Mmg Ltd. · HKEX:1208
Mmg — Minerals and Metals Group — FY2009 Earnings Presentation
22 slides from Mmg's earnings presentation, 2010
Slide 1: 2009 Full Year Financial Results
MINERALS AND METALS GROUP 2009 FULL YEAR FINANCIAL RESULTS
Slide 2: Contents
CONTENTS > Highlights > Operational Review > Financial Review > Industry Outlook > Business Outlook
Slide 3: Highlights
HIGHLIGHTS > TRIFR decreased to 6.2 > Record copper production – 38,077 tonnes of copper cathode and 18,299 tonnes of copper metal for the period > EBITDA US$350.2 m > Major projects recommenced including Sepon copper expansion > Base metal commodity price outlook strong > MMG established as the int
Slide 4: Operational Highlights
OPERATIONAL HIGHLIGHTS > TRIFR down 5% to 6.2 > Record copper production: • Copper cathode increased at Sepon due to installation of second autoclave • Copper concentrate increased due to copper focused mine plan at Golden Grove and strong results at Rosebery > Zinc production impacted by Century pi
Slide 5: Safety and Environment
SAFETY AND ENVIRONMENT 2009 MMG Total Recordable Injury Environmental Frequency Rate 12 Month Moving Average 2009 License (total recordable injuries per million Exceedences man hours) Addressed 7.0 6.0 > All exceedences were reported 5.0 to authorities and actions 4.0 implemented 3.0 > Engineering s
Slide 6: Century
CENTURY > Pipeline failure necessitated 11 week production shutdown > Normal production guidance resuming for 2010 > Overburden cut-back continues until 2011 > Current mine life to approximately 2015 > US$5.5 m 18-month exploration program commenced in November to identify new zinc deposits 2009* Pr
Slide 7: Golden Grove
GOLDEN GROVE > 2009 mine plan targetted copper > SAG mill trunnion required unplanned maintenance > US$24 m project to expand tailings storage capacity with construction of a third Tailings Storage Facility commenced > Exploration recommenced to extend mine life 2009 Production* (total contained met
Slide 8: Rosebery
ROSEBERY > Zinc production up. > Copper, gold and silver also higher. > US$1.4 m deep exploration drilling program underway. > US$23 m raise bore drilling and ventilation shaft construction underway. 2009* Production (total contained metal) Zinc (t) 53,692 Lead (t) 15,695 Copper (t) 1,641 Gold (oz)
Slide 9: Sepon
SEPON > Record copper cathode production following installation of second autoclave > US$60.4 m copper expansion project recommenced > US$12 m second power line under construction > US$3.7 m flotation de-sliming circuit to improve pyrite recovery > Gold production higher Second autoclave on right 20
Slide 10: Financial Highlights
FINANCIAL HIGHLIGHTS > EBITDA US$350.2 m > NPAT US$180.7 m > Cash on hand $251.3 m – all cash generated, reinvested in the business > Strong production and rising commodity prices generated solid revenue > China Minmetals to pursue international expansion through ongoing investment in MMG
Slide 11: Consolidated Income Statement Summary
CONSOLIDATED INCOME STATEMENT SUMMARY US$m Total revenue 852.8 EBITDA Depreciation and amortisation (158.3) Total EBITDA 350.2 EBIT Operations 236.7 Exploration and corporate expenses (44.8) Total EBIT 191.9 Net financial expenses (22.1) Income tax benefit 10.9 NPAT 180.7
Slide 12: Operating Segments
OPERATING SEGMENTS US$m Century Sepon Golden Rosebery Grove Revenue 247.5 287.8 166.0 151.5 Other income 0.7 - - - Cost of goods sold (114.8) (93.1) (73.7) (68.3) Net FX gain / (loss) (3.2) (2.1) (4.8) (1.8) Freight expenses (26.2) (15.4) (9.8) (3.6) Other expenses (17.7) (15.9) (6.1) (3.5) EBITDA 8
Slide 13: Balance Sheet Summary
BALANCE SHEET SUMMARY US$m Consolidated Dec 09 Assets Cash 251.3 Receivables 90.0 Inventory 201.0 Tax assets 65.5 Financial and other assets 22.3 Property plant & equipment 1493.7 Total Assets 2,123.8 Liabilities Trade 143.7 Interest bearing liabilities 1101.9 Tax liabilities 59.6 Provisions 266.9 T
Slide 14: Funding Arrangements
FUNDING ARRANGEMENTS US$m Equity (Issued capital) 337.0 Consolidated bank loans Balance sheet carrying amount 1,095.0 6 months or less 10.6 6-12 months 10.6 1-2 years 21.1 2-5 years 780.5 More than 5 years 355.4 Total – Principal and Interest Cash Flow 1,178.2 Cash held 251.3 Unused bank loan facili
Slide 15: Cash Flow
CASH FLOW USD m MMG Cash Flow for the period ended 31 December 2009 1,500 1,000 500 0 337.0 1,151.3 (1,386.0) (16.0) (48.6) 37.7 355.7 (138.7) (14.1) 10.7 251.3 Share Equity Net Debt Paid to OZ Acquisition costs Tax Paid Net Funds Net Operating Capex Net Financing Foreign Exchange Closing Cash Miner
Slide 16: Funding Capacity from China Minmetals
FUNDING CAPACITY FROM CHINA MINMETALS > China Minmetals 2009 revenue 172 billion Yuan (US$24.8 billion) and profit 3.15 billion Yuan (US$461 million) > Minmetals looking for overseas acquisitions to help it grow into a globally competitive mining group > MMG will serve as an international investment
Slide 17: Outlook Positive
OUTLOOK POSITIVE > Despite rising stocks, LME prices continue to rise > Investors maintain long term bullishness in metals > MMG expects increasing demand from China from continuing fiscal stimulus to fuel good metal demand through 2010
Slide 18: Zinc – China Driving Demand
ZINC – CHINA DRIVING DEMAND LME Zinc stocks compared to LME cash price Stocks - mt US$/mt 600,000 3,000 2,800 550,000 2,600 2,400 500,000 2,200 450,000 2,000 1,800 400,000 1,600 1,400 350,000 1,200 300,000 1,000 Dec-09 May-09 Jul-09 Nov-09 Jan-10 Aug-09 Sep-09 Oct-09 Jun-09 Feb-10 > Good demand from
Slide 19: Copper – Leading the Base Metals
COPPER – LEADING THE BASE METALS LME Copper Stocks compared to LME Cash Price Stocks - mt US$/mt 600,000 8,000 7,000 500,000 6,000 400,000 5,000 300,000 4,000 200,000 3,000 May-09 Dec-09 Oct-09 Jul-09 Aug-09 Sep-09 Nov-09 Jan-10 Jun-09 Feb-10 > Copper continued to lead base metals receiving addition
Slide 20: Lead – Cash Highs
LEAD – CASH HIGHS LME Lead Stocks compared to LME Cash Price Stocks - mt US$/mt 180,000 2,950 160,000 2,700 140,000 2,450 120,000 2,200 100,000 1,950 80,000 1,700 60,000 1,450 40,000 1,200 May-09 Dec-09 Jul-09 Aug-09 Sep-09 Jan-10 Oct-09 Nov-09 Jun-09 Feb-10 > Ended the year close to its cash high >
Slide 21: Business Outlook 2010
BUSINESS OUTLOOK 2010 > Primary focus on organic growth and internal development: • Sepon copper expansion commissioned November 2010 • Sepon powerline commissioned August 2010 • Sepon de-sliming circuit commissioned August 2010 • Golden Grove TSF3 commissioned September 2010 • Rosebery ventilation
Slide 22: Minerals and Metals Group contact details
Minerals and Metals Group Level 23 / 28 Freshwater Place Southbank VIC 3006 T: +61 9288 0888 F: +61 9288 0800 www.mmgroupltd.com Media enquiries: Sally Cox Communications Manager T:+61 9288 0850 [email protected]
Minerals and Metals Group — FY2009 Earnings Presentation on 6ix