Endeavour Mining Plc · TSX:EDV
Endeavour Mining — Canaccord Genuity Global Resources Conference 2012
36 slides from Endeavour Mining's conference presentation, Oct 16, 2012
Slide 1: A Gold Producer Delivering Growth
David Laing EVP Technical Services Canaccord Genuity Global Resources Conference October 16, 2012 A GOLD PRODUCER DELIVERING GROWTH 1
Slide 2: Forward-looking Statements
Forward-looking Statements This presentation contains "forward-looking statements" including but not limited to, statements with respect to Endeavour’s and Avion’s plans and operating performance, the estimation of mineral reserves and resources, the timing and amount of estimated future production,
Slide 3: What is Endeavour Mining?
What is Endeavour Mining? • A rapidly growing, diversified west African gold producer with three operating mines and a fourth under construction • Current production of 300,000 ozs/yr, expanding to 450,000 oz/yr through internal growth • Experienced operating, mine-building and exploration teams • L
Slide 4: Gold Producer With Track Record
Gold Producer With Track Record Nzema, Ghana Operating Mines Youga, Burkina Faso Tabakoto, Mali Mine in Construction Agbaou, Côte d’Ivoire Houndé, Burkina Faso Kofi, Mali Resource Development Nzema Sulphides, Ghana Ouarê, Burkina Faso Pro forma 2012 $46 million Exploration 2011* – 268,490 ozs Pro fo
Slide 5: Nzema Gold Mine, Ghana
Nzema Gold Mine, Ghana Nzema Gold Mine Resources • M&I: 48.329Mt @ 1.30 g/t for 2.064Moz (incl. of Reserves, • Inferred: 17.725Mt @ 1.1 g/t for 100%) 0.652Moz Reserves (100%) 14.603Mt @ 2.0 g/t for 0.964Moz Strip Ratio 3 to 1 Processing Rate 1.6 to 2.1Mtpa Gravity/CIL plant Met. Recovery 91% to 75%
Slide 6: Youga Gold Mine, Burkina Faso
Youga Gold Mine, Burkina Faso Youga Gold Mine Youga & Youga Satellites (within 4 km) Resources (incl. of • M&I: 18.373Mt @ 1.6g/t for 0.928Moz Reserves, 100%) • Inferred: 4.673Mt @ 1.3g/t for 0.193Moz Reserves (100%) 7.308Mt @ 1.9g/t for 0.448Moz Strip Ratio 4.6 to 1 Met. Recovery 94% Mining Method
Slide 7: Tabakoto Gold Mine, Mali
Tabakoto Gold Mine, Mali Tabakoto (UG), Segala (UG) & Djambaye Open Pit Mine 360km west of Bamako in western Mali, Location adjacent to border with Senegal Segala: M&I: 3.40, 4.44, 532,191 Ownership 80% Endeavour, 20% Republic of Mali Inf: 1.70, 3.87, 229,583 Resources (incl. of • M&I: 1.115Mozs (83
Slide 8: Mill Expansion at Tabakoto
Mill Expansion at Tabakoto 2,000 to 4,000 tonnes per day at a cost of ~$15 million to complete 4,000 tpd Sag Mill Installation New Leach & CIL Tanks New Electrical Building New Thickener A GOLD PRODUCER DELIVERING GROWTH 8
Slide 9: Resource / Reserve Development Tabakoto
Resource / Reserve Development 4.55 g/t Au/22.0 m Tabakoto 4.90 g/t Au/13.8 m 4.89 g/t Au/26.7 m • Tabakoto – all zones open at depth • 31 mineralized structures identified 12.49 g/t Au/24.4 m • Bulk of reserves on six structures with 28.67 g/t Au/15.9 m opportunity to add resources and reserves in
Slide 10: Resource / Reserve Development Segala
Resource / Reserve Development Segala • 5km from Tabakoto • Represents 55% of underground resources • Decline development has recommenced • Decline from the bottom of the Segala pit • Segala Main is open at depth and west along strike Segala Underground Mine Planned Development Looking East A GOLD P
Slide 11: Endeavour's Next Mine: Agbaou Gold Project
Endeavour’s Next Mine: Agbaou Gold Project • Project parameters: Agbaou Site Plan • 85% Endeavour / 15% Côte d’Ivoire government • Open pit with up to 1.6Mtpa CIL plant and 92.5% recovery • Contract mining • 8 year mine life producing 103,000 ozs/yr from current reserves • Development cost of $159 m
Slide 12: Key Development Project Houndé – Vindaloo Deposit
Key Development Project Houndé – Vindaloo Deposit (90% Effective Ownership) • Current Resources: • 893,000 ozs M&I (13.4 Mt at 2.07 g/t) and • 712,000 ozs Inferred (10.7 Mt at 2.07 g/t) • Demonstrated open pit potential • Preliminary metallurgical testwork indicates gold recovery averaging 93% • Ong
Slide 13: Key Exploration Assets: Kofi Project
Key Exploration Assets Kofi Project (75% Effective Ownership) Kofi • Kofi property ~360km by road west Bamako, Mali’s capital city • Southern boundary of Kofi is 5 km from Tabakoto • Comprised of 8 exploration licenses (total area of ~435 km2) and 1 mineral concession of ~45 km2 • Target-Rich Mining
Slide 14: Endeavour's Exploration Investment in Exploration
Endeavour’s Exploration Investment in Exploration West African Birimian and Archean Greenstone • 2012 pro forma budget: $46 million 275,000 metres of drilling (proforma) • Focused on near-mine targets Tabakoto • Three PEAs by year-end: • Houndé • Nzema Sulphides • Ouaré • Land position of 11,800km2
Slide 15: Accra Operations Hub
Accra Operations Hub Operations Accra, Ghana • COO’s office • Operations management • Group procurement / supply chain • Exploration • HR • CSR program management Nzema Gold Mine Youga Gold Mine Tabakoto Gold Mine Agbaou Gold Project Ghana Burkina Faso Mali Côte d’Ivoire A GOLD PRODUCER DELIVERING G
Slide 16: Pro Forma Gold Production Profile
Pro Forma Gold Production Profile Gold Production (ozs) • Clear organic growth path to >450,000 ozs p.a. Based on Endeavour Management forecasts (100% basis) A GOLD PRODUCER DELIVERING GROWTH 16
Slide 17: Mine Margins – Cash flow Generation
Mine Margins – Cash flow Generation Mine Basis Annual Gold Cash Cost Royalties Annual Cash Production per Ounce (at $1,600 gold Margin (Ounces,100% price) (at $1,600 gold basis) price) 2012e guidance Nzema (mid range) 107,000 $690* 5% $85 million 2012e guidance Youga (mid range) 87,500 $665 5% $75 m
Slide 18: Market Positioning – 2014E Production
Market Positioning – 2014E Production1 • Forecasted to be one of the largest African junior gold producers by 2014 as well as one of the largest junior gold producers on the TSX (rivaling producers such as AuRico and New Gold) Junior Gold Producer Universe (2014E Sourced from Canaccord Genuity)1 481
Slide 19: Financial Strength to Deliver Growth
Financial Strength to Deliver Growth • Endeavour is fully funded for: • Agbaou mine construction • Tabakoto mill expansion • Development programs • Endeavour’s financial strength includes: • Pro forma Cash: $50 million (as of June 30, 2012) • Pro forma Cash margin (2012E): ~$220 million • Corporate
Slide 20: Building to 450,000 Ounces and Beyond
Building to 450,000 Ounces and Beyond Production growth from 300,000 ozs/yr to 450,000 ozs/yr • Complete Tabakoto mill expansion • Continue Segala development at Tabakoto to bring second underground mine on-line • Agbaou commissioning early 2014 And beyond • Four advanced stage projects to choose fr
Slide 21: Appendices
Appendices • Company Profile • Resources and Reserves • Avion Transaction Terms • Avion Transaction Market Positioning • Management • Capital Structure • Hedge Details • Q2 Highlights • Cash Flow
Slide 22: Endeavour Company Profile – Pre Avion Acquisition
Appendix: Endeavour Company Profile – Pre Avion Acquisition Share Price (October 4, 2012) Balance Sheet CDN$2.35 Cash & Marketable Securities (June 30, 2012) $144m Recent Share Price Includes $100m drawn of the $200m credit facility AUD$2.19 Market Cap. (basic) $575m Cash Margin, 2012e (at $1,600/oz
Slide 23: Pro Forma Mineral Reserves
Appendix: Pro Forma Mineral Reserves Reserves Proven Probable Proven & Probable Gold Mine / Project Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces Price Mt g/t Mt g/t Mt g/t US$/oz Nzema1,2,3,4- Total 11.938 2.0 770,000 2.664 2.3 193,000 14.603 2.0 964,000 US$900 Attributable - 90% 693,
Slide 24: Pro Forma Mineral Resources
Appendix: Pro Forma Mineral Resources Resources (including reserves) Lower Measured Indicated Measured & Indicated Inferred cutoff Mine / Project Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces Mt Au g/t Mt Au g/t Mt Au g/t Mt Au g/t Au g/t Nzema1,2,3,4 - Total 31.658
Slide 25: Notes to Pro Forma Mineral Resource and Reserve Tables
Appendix Notes to Pro Forma Mineral Resource and Reserve Tables a Effective dates are as follows: Nzema & Youga – December 31, 2011, Ouare – June 16 2009, Agbaou – May 25, 2012, Finkolo – June 10, 2010, Tabakoto – January 1, 2012, Kofi – December 21, 2011, Houndé – December 19, 2011 1 Technical Repo
Slide 26: Key Transaction Terms
Appendix: Key Transaction Terms Proposed Transaction • 0.365 Endeavour shares for every Avion share • Exchangeable share option, may provide eligible Avion shareholders deferral of Canadian tax Offer: • Avion stock options to be varied to become exercisable on the same 0.365 exchange ratio • Offer t
Slide 27: Market Positioning – Market Capitalization
Appendix: Market Positioning – Market Capitalization1 • As compared to its junior African and TSX/TSX-V junior gold producer peers, Endeavour’s pro forma market capitalization is well positioned for an significant re-rating Junior Gold Producer Universe (2014E Sourced from Canaccord Genuity)1 $4,823
Slide 28: Market Positioning – P/NAV
Appendix: Market Positioning – P/NAV1 • According to Canaccord Genuity Research, pro forma Endeavour also has significant valuation upside on a P/NAV multiple basis Junior Gold Producer Universe (2014E Sourced from Canaccord Genuity)1 1.03x 0.90x 0.90x 0.89x 0.86x 0.84x 0.83x 0.78x 0.77x 0.73x 0.73x
Slide 29: Market Positioning – P/CF
Appendix: Market Positioning – P/CF1 • According to Canaccord Genuity Research, pro forma Endeavour would trade at a significant discount to other TSX/TSX-V junior gold producers on a P/CF multiple basis Junior Gold Producer Universe (2014E Sourced from Canaccord Genuity)1 14.91x Median (Upper 2/3)
Slide 30: Endeavour Management
Appendix: Endeavour Management Michael Beckett Neil Woodyer Attie Roux Non Exec Chairman CEO COO • Significant mining knowledge • Founder of Endeavour, over • Built / commissioned Nzema 30 years experience in natural processing plant • Served on Boards of Consolidated resources Gold Fields, Gold Fie
Slide 31: Endeavour Share Capital
Appendix: Endeavour Share Capital (As of August 7, 2012) Issued Shares 245,091,769 Options Strike price Strike Price Range (CDN$) Average (CDN$) 0.01 1.94 1.92 7,600,890 2.04 2.47 2.34 1,087,220 2.64 2.95 2.67 7,980,000 7.19 44.96 15.49 714,826 Warrants Symbol Expiry Strike price EDV.WT.A Feb 4 2014
Slide 32: Pro Forma Capital Structure
Appendix: Pro Forma Capital Structure (Pro Forma using Issued Shares, Options and Warrants as of August 7, 2012) Issued Shares 406,980,891 Options Strike price Strike Price Range (CDN$) Average (CDN$) 0.01 2.00 1.68 17,914,914 2.04 2.47 2.36 1,233,220 2.64 2.95 2.70 8,969,606 3.70 4.68 4.50 2,320,85
Slide 33: Gold Hedging Details
Appendix: Gold Hedging Details Nzema Annualized Hedge Book Profile1 Year Strike Price Hedged Ozs 2012 $1,061.75 10,000 2013 $1,061.75 10,000 2014 $1,061.75 32,000 2015 $1,061.75 32,000 2016 $1,061.75 32,000 Total 116,000 Tabakoto Annualized Call Options Program Profile2 Year Average Strike Price Ozs
Slide 34: Endeavour Q2/2012 Financial Highlights
Appendix: Endeavour Q2/2012 Financial Highlights Q2/2012 Q1/2012 Total 3 months 3 months 6 months Gold production (ounces) 50,728 51,963 102,691 Gold sold (ounces) 52,415 47,559 99,974 Total cash cost per oz produced $641 $7161 $6791 Total cash cost per oz sold $719 $7111 $7151 US$ US$ US$ Millions
Slide 35: Cash Flows from Mine Operations (Qtr)
Appendix: Cash Flows from Mine Operations (Qtr) 50 $47.6 million US$M 45 40 35 30 Adjusted to include $8.5 million for March production with cash proceeds received in early April 25 20 15 10 5 0 2010 2011 Q2/2012 • Q2/2012 cash flows from mine operations of $47.6 million, which is net of an adjustme
Slide 36: Contact
David Laing EVP Technical Services [email protected] +1 604 609 6133 Marla Gale VP Investor Relations [email protected] +1 604 609 6117 A GOLD PRODUCER DELIVERING GROWTH 36
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