Mineral Resources Limited · ASX:MIN
Mineral Resources — FY2007 Earnings Presentation
42 slides from Mineral Resources's earnings presentation, Aug 23, 2007
Slide 1: Mineral Resources Limited FY 2007 Results
For personal use only Mineral Resources Limited An integrated supplier of goods and services to the Resources Sector FY 2007 Results “Growing Strongly” Peter Wade, Managing Director August, 2007 Bruce Goulds, Chief Financial Officer Page 1
Slide 2: Consolidated Group Structure
For personal use only Consolidated Group Structure Mineral Resources Limited ACN 118 549 910 “An integrated supplier of goods and services to the Resource sector” Page 2
Slide 3: Board and Management
For personal use only Board and Management * * Non-Executive Director - Additional Appointment Pending Page 3
Slide 4: About Mineral Resources Limited
For personal use only About Mineral Resources Limited • Listed on the ASX in July, 2007 (ASX: MIN) • Formed through the consolidation of 3 associated, long established and successful operations into integrated mining services and processing company • PIHA – manufacturing and contracting business inv
Slide 5: Agenda
For personal use only Agenda 1 Highlights 2 Financial Results and Analysis 3 Operational Review 4 Outlook Page 5
Slide 6: Highlights - Operational
For personal use only Highlights - Operational • Consolidation of listed entity with successful integration of Board and management • Maintenance of world best practice HSE results • Improved manganese market demand and sales price • Engagement of drilling contractors for sampling on Philippine iron
Slide 7: Export of Blended Iron Ore Product
For personal use only Export of Blended Iron Ore Product Page 7
Slide 8: Highlights – Financial
Highlights – Financial FY 2007 For personal use only • NPAT of $20.167 million – an increase of 96% over FY 2006 and 47% ahead of Prospectus forecasts • Strong growth in manganese prices over last 6 months • Debt to Equity ratio 11.7% with strong cash generation • Interest cover 18 times • 50% divid
Slide 9: Financial Comparison: Actual Performance Year on Year
Financial Comparison Actual Performance For personal use only Year on Year FY 2007 FY 2006 Variance % Actual Actual Revenue 148.8 105.9 40.5% EBITDA 37.8 23.0 64.3% NPAT 20.2 10.3 96.1% Page 9
Slide 10: Financial Comparison: Prospectus Forecast
Financial Comparison Prospectus Forecast For personal use only FY 2007 FY 2007 Variance Actual Prospectus % Forecast Revenue 148.8 120.7 23.3% EBITDA 37.8 34.5 9.6% NPAT 20.2 13.7 47.4% Page 10
Slide 11: World Best Practice HSE Performance
World Best Practice HSE For personal use only Performance July, 2007 Number of Lost Time Injuries LTIFR = Number of Hours Worked x 1,000,000 20 16 Lost Time Injury 12 Frequency Ratio (LTIFR) 8 4 0 PMI CSI PIHA Mineral Resources Industry Average Page 11
Slide 12: Agenda
For personal use only Agenda 1 Highlights 2 Financial Results and Analysis 3 Operational Review 4 Outlook Page 12
Slide 13: Financial Performance
For personal use only Financial Performance $AUD millions FY 2007 Revenue 148.8 EBITDA 37.8 Depreciation 10.7 EBIT 27.1 Interest 1.5 PBT 25.6 Tax Expense 5.4 NPAT 20.2 EBITDA / Revenue 25.4% EPS (cents) 16.9 Page 13
Slide 14: Balance Sheet Strength to Facilitate Growth
Balance Sheet Strength to Facilitate For personal use only Growth $AUD millions June 2006 June 2007 $ Change % Change Total Assets 123.6 157.7 34.1 13.8% Total Liabilities (79.9) (82.0) 2.1 (4.5%) Net Assets 43.7 75.7 32.0 47.1% Net Debt (inc. cash balances) (33.5) (8.8) 24.7 (66.0%) Funds Employed
Slide 15: Strong Operational Cashflows
For personal use only Strong Operational Cashflows $AUD millions 12 months to June 2007 EBITDA 37.9 CAPEX (net) (11.0) Net Interest Payments (1.5) Working Capital and Other (6.3) Net Operating and Investing Cashflow 19.1 Financing Cashflow 1.6 Total Increase in Cash 20.7 Page 15
Slide 16: Revenue Performance
For personal use only Revenue Performance 160 140 120 100 $million 80 60 40 20 0 FY 2003 FY 2004 FY 2005 FY 2006 Prospectus FY 2007 2007 Actual Page 16
Slide 17: EBITDA Performance
For personal use only EBITDA Performance 40 35 30 25 $ million 20 15 10 5 0 FY 2003 FY 2004 FY 2005 FY 2006 Prospectus FY 2007 2007 Actual Page 17
Slide 18: Agenda
For personal use only Agenda 1 Highlights 2 Financial Results and Analysis 3 Operational Review 4 Outlook Page 18
Slide 19: Operational Review of FY2007 Performance
Operational Review of FY2007 Performance For personal use only • Successful consolidation of privately owned companies into ASX listed MIN • Processing operation expanding business opportunities supported by increased manganese demand and sales prices • Contracting and crushing operations performing
Slide 20: Review of Contracting Services Operations
Review of Contracting Services Operations For personal use only • Market leader in niche contracting markets of pipelining, polyethylene fittings manufacture and mine site infrastructure and services installation • Overseas contracts for pipelining, fittings and poly welding operations awarded – New
Slide 21: Trenching Machine
For personal use only Trenching Machine Page 21
Slide 22: Tailings Dam Pipework
For personal use only Tailins Dam Pipework Page 22
Slide 23: Pipe Laying Operation
For personal use only Pipe Laying Operation Page 23
Slide 24: Review of Contract Crushing Operations
Review of Contract Crushing Operations For personal use only • All existing sites achieving world best practice for HSE • All production targets for clients have been met • Plant and equipment inventory supports project opportunities • Confirmed focus on personnel safety and plant maintenance as key
Slide 25: Site Construction Work
For personal use only Site Construction Work Page 25
Slide 26: Gyratory Crusher Installation
For personal use only Gyratory Crusher Installation Page 26
Slide 27: Secondary Crusher Feed
For personal use only Secondary Crusher Feed Page 27
Slide 28: Review of Processing Operations
For personal use only Review of Processing Operations • Manganese processing plant at Woodie Woodie continued to achieve target throughput. • 280,000 tonne per annum manganese fines contract with CITIC formalised in January, 2007 and initial shipments were achieved • Strong AUD /USD forex and increa
Slide 29: Blended Iron Ore Stockpiles
For personal use only Blended Iron Ore Stockpiles Page 29
Slide 30: Manganese Product in Stockpile
For personal use only Manganese Product in Stockpile Page 30
Slide 31: Manganese for Export at Port Hedland
For personal use only Manganese for Export at Port Hedland Page 31
Slide 32: Agenda
For personal use only Agenda 1 Highlights 2 Financial Results & Analysis 3 Operational Review 4 Outlook Page 32
Slide 33: Outlook - Market
For personal use only Outlook - Market • Strengthening demand and pricing for manganese has continued; demand expected to remain strong for next quarter • Continuing strong global demand for commodities albeit with some price weakness for selected metals • ‘China story’ to remain expansive in the lo
Slide 34: Abare Research Report 07.3
For personal use only Abare Research Report 07.3 Page 34
Slide 35: Abare Australian Commodities March
For personal use only Abare Australian Commodities March 07 Page 35
Slide 36: China's Iron Ore Consumption and Imports
China’s Iron Ore Consumption and Imports For personal use only 800 700 600 500 Mt 400 300 200 100 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 consumption imports Abare Australian Commodities March 07 Page 36
Slide 37: Australian Iron Ore Exports
For personal use only Australian Iron Ore Exports 350 330 310 290 270 Mt 250 230 210 190 170 150 2005 2006 2007e 2008e 2009e Source: Abare March 2007 Page 37
Slide 38: Outlook - Operational
For personal use only Outlook - Operational • Continuing focus on HSE quality performance to maintain world best practice • Presentation of sampling results for iron sands tenements in Philippines • Increased production of manganese at Woodie Woodie operation. • Export of residual blended iron ore p
Slide 39: Outlook - Corporate
For personal use only Outlook - Corporate • Additional Non-Executive Director to be added to the Board • Balance sheet capable of supporting significant additional projects and acquisition initiatives • Dividend payout ratio of 50% confirmed by Board as long term commitment • Continuation of skills
Slide 40: Outlook – Business Strategy
For personal use only Outlook – Business Strategy • Maintain core business focus • Add value to clients and shareholders and maintain strong client relationships • Strengthen Board, management and operating team • Grow business as measured by earnings per share, client listing and company reputation
Slide 41: Business Model
For personal use only Business Model Core Business Integrated supplier of goods + and services to the resources sector + Market Opportunities Focus Areas Contract crushing HSE performance Mineral processing Margins and Infrastructure and profitability mining sector Cost control services Client relat
Slide 42: Our People
For personal use only Our People Page 42