Volcan Compania Minera S.A.A. Class A · BVL:VOLCAAC1
Volcan Compania Minera S.A.A. Class A — Investor Presentation (November 2024)
32 slides from Volcan Compania Minera S.A.A. Class A's investor presentation, November 2024
Slide 1: Volcan Compañía Minera Corporate Presentation
Volcan Compañía Minera Corporate Presentation November 2024 0
Slide 2: Disclaimer
Disclaimer Some statements contained in this presentation or in documents referring to this presentation may contain inaccuracies. No reliance for any purpose whatsoever may be placed on the information or opinions contained in this presentation or on the completeness of this presentation. Volcan Co
Slide 3: Schedule
Schedule 1 Overview 2 ESG 3 Operations 4 Growth Strategy 5 Romina Project 6 Financials 2
Slide 4: Volcan Overview
Volcan Overview Volcan is a Leading Producer of Zinc, Silver and Lead 2023 Sales (USD MM) Gold 3% Peru1 Globally 2 2° Zinc Producer 9° Zinc Producer Silver 33% 1° Lead Producer 10° Lead Producer 883 48% Zinc 2° Silver Producer 11° Silver Producer 13% Copper 3% Lead • Operations in most prospective p
Slide 5: Stock Market Highlights
Stock Market Highlights Class A Shares1: Full voting rights Shares outstanding: 1,633,414,553 557 shareholders Stock Market Listings Lima Since 1956 Madrid (Latibex) Since 2000 Class B Shares 2 : Div. premium of 5% over Class A Santiago Since 2007 Shares outstanding: 2,443,157,622 11,826 shareholder
Slide 6: Mining Operations
Mining Operations Production San Cristóbal Animón Reserves and Resources 1 Andaychagua Alpamarca Ticlio Oxides 1 Reserves and Resources as of Dec/23. 5
Slide 7: General Strategy
General Strategy Operational Excellence Focus in Mining Strengthening & Growth Driving operational excellence, Boosting shareholder value by Develop the potential of our ensuring high safety and centering our strategy on our current units, brownfield and environmental standards, and mining core busi
Slide 8: Schedule
Schedule 1 Overview 2 ESG 3 Operations 4 Growth Strategy 5 Romina Project 6 Financials 7
Slide 9: Occupational health and safety management
Occupational health and safety management Occupational Health and Safety Objectives Promote safe work environments through comprehensive management of hazards and risks, establishing controls, management tools, Main and verification actions that ensure the implementation of a Safety Culture objectiv
Slide 10: Occupational health and safety management
Occupational health and safety management Results of Security Management 42 10 9 7 6 14 5 4 Culture 3 Change 3 3 3 04 begins 2 1 1 1 1 1 0 0 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Recognition for Security Management 2020 2021 2022 2023 Honora
Slide 11: Environmental Sustainability
Environmental Sustainability Environmental Sustainability Framework Objectives Strategic Environmental Pillar Improve the Company’s Environmental Performance through effective management of environmental risks, Primary allowing for the elimination, minimization and mitigation of impacts on water, la
Slide 12: Environmental Sustainability
Environmental Sustainability Strategic Milestones Development Specific Strategies Milestones in development • Development of water management plans Milestones developed Hydraulic aligned with ICMM Plan 2024 - 2026 Management • Treatment system optimization goals • Environmental sustainability framew
Slide 13: Community Relations
Community Relations Community Community Key Social Strengthening Tax-funded Projects Engagement Development Programs Local Economy Projects including the 36 communities in the USD 5.7MM allocated Educational, health, and Contracts with 13 Chancay Municipal Sports economic development influence area
Slide 14: Corporate Governance and Compliance
Corporate Governance and Compliance Corporate governance Risk areas covered by Compliance Programme Milestones developed • Establishment of the Board of Directors, composed of 7 ANTI-CORRUPTION AND BRIBERY CONFLICTS OF INTEREST FRAUD AWARENESS members who meet monthly • Approval of the Board of Dire
Slide 15: Schedule
Schedule 1 Overview 2 SSOMAC 3 Operations 4 Growth Strategy 5 Romina Project 6 Financials 14
Slide 16: Mining operations production
Mining operations production Consolidated Production Production by Metal (%) 2023 Thousand FMT 242 230-240 221 225 Gold Zinc 3% Silver 29% Silver MM Oz 2021 2022 2023 2024e* 15 14 15 13-14 53% Zinc 4% Copper 11% Thousand FMT 61 50-55 Lead 55 55 2021 2022 2023 2024e* Lead Production by Unit (%) 2023
Slide 17: Production Cost
Production Cost Annual Production Unit Cost1 Production cost 2024e (USD/TMT) By area USD 464 MM By element -6% 18% Mine/Pit Labor 54.0 -4% Plant 55% 26% Supplies 52.3 50.7 Administrative and Services 48-51 others Energy Maintenance 20% 45% 17% 8% 11% 2021 2022 2023 2024e * 1Note: Unit Cost includes
Slide 18: Cost-saving Initiatives: Volcan Avanza Program
Cost-saving Initiatives: Volcan Avanza Program Volcan Avanza Main cost-saving initiatives with the greatest impact on Program 2024 operations Savings 2024 USD 31.8M • Optimization of DDH drilling costs in San Cristobal-Carahuacra and Andaychagua. • Optimization of transportation costs for Energy Con
Slide 19: Investments
Investments Total Volcan investments Sustaining Capex - 2024e (USD MM) Support & Others 224 ElectricalInfraestructure in Units 2% Local Exploration 177 5% 8% 168 165-170 Mine & Infraestructure 21% 45% Development 19% 17 11 14-18 3 Plants & TailingsFacilities 2021 2022 2023 2024e* Sustaining Growth K
Slide 20: Schedule
Schedule 1 Overview 2 SSOMAC 3 Operations 4 Growth Strategy 5 Romina Project 6 Financials 19
Slide 21: Growth Strategy
Growth Strategy Growth in current operations Brownfield & projects Greenfield M&A Opportunities • Develop advanced exploration projects with • Develop project portfolio with the • Develop new targets in our concessions • Evaluate acquisitions of mines in short-term operation possibilities possibilit
Slide 22: Exploration Strategies
Exploration Strategies 2025 Exploration Program • Total program 146 km of diamond drilling with an investment of USD 21M. • 73% for reserve conversion in current operations (106 km) • 8% for Brownfield exploration (11 km) • 19% for growth, distributed as 15% for advanced Project Reserve Gains 73% de
Slide 23: Schedule
Schedule 1 Overview 2 SSOMAC 3 Operations 4 Growth Strategy 5 Romina Project 6 Financials 22
Slide 24: Romina Project Overview
Romina Project Overview To Animón (public Alpamarca Project highlights road) • Polymetallic deposit that includes zinc, lead, silver, and copper mineralization plant & TSF throughout Access road • Open pit and underground mine • Total Resources of 11.9 mm of MT @5.1% Zn, 2.8% Pb, 1.3 oz/t Ag, SR: 2.
Slide 25: Romina Project Impact
Romina Project Impact Production 20.2% 49 Increase Life of FMT 000 Zinc Cost Efficiencies Mine 242 232 229 + 13 years • Higher quality rock allows large-scale extraction methods. 2023 2024e 2027e • It requires only one main pumping Current Operations Romina system • Ventilation demand is centralized
Slide 26: Romina Project status
Romina Project status • Alpamarca plant refurbishment • LT & SE Roberto Letts Tunnel • Mine development • LT UG ramp • 3 km Road Romina - Alpamarca • Roberto Letts tunnel portal • Platforms and gateways • Waste dump construction • Mine ramp portal and subestation • PTARI gateway • PTARI equipment in
Slide 27: Schedule
Schedule 1 Overview 2 SSOMAC 3 Operations 4 Growth Strategy 5 Romina Project 6 Financials 26
Slide 28: Price Evolution & Revenues
Price Evolution & Revenues 25.2 28.4 3,485 21.8 23.4 Silver USD / Oz 3,005 Zinc USD / T 2,779 2,649 9,315 9,331 Copper 2021 2022 2023 2024e 2021 2022 2023 2024e 8,815 8,483 USD / T 2,205 2,389 2,153 2,137 2,110 1,943 2021 2022 2023 2024e USD / Oz Gold 1,802 Lead 1,800 USD / T 2021 2022 2023 2024e 20
Slide 29: EBITDA & Cash balance
EBITDA & Cash balance EBITDA (USD MM) 45.3% Prices (2023 vs 2024e) 389 395-410 4.9% Zinc 21.3% Silver 299 277 Commercial Terms (2023 vs 2024e) 48.4% 2021 2022 2023 2024e* Cash Balance Bridge as of Sep/24 YTD (USD MM) EBITDA Bridge Cash Balance FCFFO +USD 85.6 MM 250.0 USD 101.1 MM 200.0 32.7 15.1 as
Slide 30: Financial Optimization
Financial Optimization New Debt Maturity Profile (USD MM) Improved Cost Management Commercial Terms Efficiencies Outstanding Debt • USD 68 MM of Senior Notes 2026 • USD 297 MM of Senior Secured Notes 2030 48% Increase Unit costs down by 4% • USD 344 MM of Senior Secured Loan (2023 vs 2024e) (2023 vs
Slide 31: Bonds and Credit Ratings
Bonds and Credit Ratings International Bonds outstanding • USD 68 MM of 4.375% Senior Notes Volcan due 2026 • USD 297 MM of 8.75% Senior Secured Notes due 2030 B- Top investors in Volcan Notes Caa1 • Alliance Bernstein • Fidelity • Man As a result of the refinancing process, Volcan received credit •
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