Metro Mining Limited · ASX:MMI
Metro Mining — Noosa Mining Conference 2017
31 slides from Metro Mining's conference presentation, Jul 20, 2017
Slide 1: Noosa Mining
Noosa Mining 20 July 2017 1 ASX:MMI
Slide 2: Important Notice
Important Notice No reliance: To the maximum extent permitted by law, the information contained in this presentation is Mr McLean consents to the inclusion in this presentation of the matters based on information in the form given without any liability whatsoever being accepted by Metro Mining Limit
Slide 3: Investment Highlights
Investment Highlights 1 Proven Board & management team focused on shareholder value 2 Fully financed to first production 3 Transformational growth in China’s seaborne bauxite demand driven by fundamentals 4 Simple DSO project well located in Cape York with significant competitive advantage 5 Compell
Slide 4: Equity Raising Overview
Equity Raising Overview Two tranche placement (Placement)to raise $38 million1 Tranche 1 to raise $33.9 million with 251.0 million new Metro shares (New Shares) to be issued under Offer Structure & Size Metro’s existing placement capacity Tranche 2 to raise $4.1 million with 30.5 million New S
Slide 5: Sources & Uses to First Production
Sources & Uses to First Production Sources1 Amount Uses1 Amount Equity Raising $38.0m Remaining Capital Costs (Including truck haulage fleet) $38.0m Debt Financing Package2 $40.0m Drilling (exploration & grade control) $4.0m Cash on Hand (30-June-2017) $15.3m Financial Assurance & Environmental Cost
Slide 6: Corporate Snapshot
Corporate Snapshot Capital Structure (Post-Equity Raising) Share Price Share Price (14-July-17) $0.175 $0.18 $0.16 Shares on Issue 1,285.5M $0.14 Market Cap $224.9M $0.12 $0.10 Options Unlisted 11.7M $0.08 Cash (30-June-2017 Post Equity) $51.4M $0.06 $0.04 BUY (Jul-17) Unsecured Debt (30-June-17) $1
Slide 7: Recent Achievements & Value Platform
Recent Achievements & Value Platform ▪ Metro has completed several value adding milestones in 2017 to be primed for near term production 1 4 Binding Sales Agreement ✓ ✓ Doubled reserves for 7Mt over 4 years & Developed LOI for 2.5Mt over 3 years Acquired Gulf Gained infrastructure Customer Bas
Slide 8: Key Achievements
Key Achievements ▪ New Management Team and shift of focus to Bauxite Hills has delivered shareholder returns of 485% and overseen growth in Market Cap from $9M to ~$190M Debt $38M Financing & Equity Raise 0.18 6Mtpa BFS EA’s Granted Native Title complete Agreement 0.16 0.14 Greenstone Reserve Financ
Slide 9: Bauxite Hills Mine Snapshot
Bauxite Hills Mine Snapshot Location Key Statistics 1 Ownership: Metro (100%) Location: Cape York, Qld Project Overview Commodity Bauxite Product Type Direct Shipping Ore Mine Type Surface mining Contained mineral: • Reserves 92.2Mt* • Resources 144.8Mt* Status EA Granted, ML Pending Construction H2
Slide 10: Simple DSO Project
Simple DSO Project Operational simplicity and specialist mining and transhipment contractors enables easy to manage operations Proven, well known operator TSA to be transhipment contractor and will supply all vessels Existing infrastructure provides numerous development advantage Mining Clear
Slide 11: Low Logistics Costs
Low Logistics Costs Metro’s low cost shipping is a sustainable cost advantage to China relative to competing bauxite producers 11. | ASX : MMI | Equity Raising Investor Presentation | 17 July 2017
Slide 12: Compelling Economics
Compelling Economics * Compelling project economics provide attractive investment upside 3 High Margin Low Capex Avg. LOM OPEX1,2 vs. Avg. LOM Price Received (CIF) CAPEX vs. Avg. LOM EBITDA ~43% margin Payback within 1.7 years $61/WMT $73m $145m Expansion $37m $35/WMT Capital Initial Capex 3 $
Slide 13: Strong Cost Curve Positioning
Strong Cost Curve Positioning 2nd quartile cost curve positioning provides attractive long term competitive advantage China Seaborne Bauxite Supply Cost Curve 2019 – Value-in-use Adjusted US$/Dmt (CFR) 1St Quartile 2nd Quartile 3rd Quartile 4th Quartile US$/DMT 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.
Slide 14: Construction Team
Construction Team Brisbane / Mackay / Gladstone Queensland Feasibility & engineering Civil works Owner’s team project Haul Roads construction management Queensland North Queensland operations Piling works Camp management Marine installation Marine infrastructure Brisbane ma
Slide 15: Early Construction Underway
Early Construction Underway Bauxite Hills Village New camp under construction Installation planned for Nov 2017 Existing camp used during construction Barge Load-Out Facility TSA appointed as marine infrastructure manager Fabrication of piles completed and due for August 2017 arrival Con
Slide 16: Rapid Pathway to Production
Rapid Pathway to Production Early works now underway with first production scheduled for April 2018 9 months to Production (estimate) 2017 2018 May June July Aug Sept Oct Nov Dec Jan Feb Mar April Financing Piles & Steel Fabrication Camp Refurbishment Tug & Barge Mobilisation Civil Works ▪ Barge L
Slide 17: Structural Change in China
Structural Change in China China’s seaborne bauxite imports are forecast to grow from ~50mtpa in 2015 to ~150mtpa by 2030 Chinese Aluminium Production & Growing Seaborne Bauxite Demand Declining Chinese Bauxite Reserve Life Years 50.0 60 Imported Alumina as Bauxite Imported Bauxite 53 Domestic Bau
Slide 18: Positive Bauxite Price Outlook
Positive Bauxite Price Outlook Bauxite has experienced relatively steady and positive price growth since the GFC with growing Chinese demand to support longer term price growth CM Group historic CBIX price & forecast USD$/DMT CFR 80.0 CM Group CBIX BFS Group CM Assumption CBIX Forecast 70.0 60.0 5
Slide 19: Summary – A Compelling Investment
Summary – A Compelling Investment 1 Metro has significant advantages and is backed by leading partners 2 Strong seaborne bauxite fundamentals in China drive positive outlook 3 Recent achievements have delivered platform for value creation 4 Compelling metrics provides significant share price upside
Slide 20: Background Slides
Background Slides 28. | ASX : MMI |Investor Presentation | 20 July 2017
Slide 21: Board of Directors
Board of Directors Stephen Everett Chemical engineer with 40+ years experience in the resources and construction industries both in Australia and overseas Chairman Formerly Chair of BeMaX Resources, Australian Solomons Gold, JMS Civil &Mining & IronRidge Resources Mining executive with +30 yea
Slide 22: Proven Management Team
Proven Management Team ▪ Metro’s Board & management have collectively been involved in the development and operation of over 30 mines globally ▪ Significant bauxite knowledge and expertise, focused on Cape York bauxite operations and product marketing into China ▪ Strategy is to develop and operate
Slide 23: Supportive Partners
Supportive Partners Metro and Bauxite Hills Mine has attractive strong support from leading product partners and financial investors Product Quality & Demand Economics & Financial Returns China’s 2nd largest bauxite importer 20% cornerstone shareholder 4 year binding off-take for 7Mt Balance
Slide 24: BFS Summary
BFS Summary Bankable Feasibility Study Highlights* ▪ Completed by MEC Mining in March 2017 ▪ 6Mtpa steady state (initial 2Mtpa) ▪ Contract mining and transhipment ▪ 8 months per year dry season operation (April to Nov) ▪ 5 month construction period Key Results and Assumptions 1 Description Result As
Slide 25: BFS Capital Cost Estimates
BFS Capital Cost Estimates* Capital Cost Item Amount Capital Cost Item Amount Initial Capital Expansion Capital (in years 2 and 3) Integrated Truck dump and Site establishment and haul A$3.1M screens and upgraded haul A$13.9M roads roads Key infrastructure including BLF A$25.8M Transhipment upgrades
Slide 26: BFS Operating Cost Estimates
BFS Operating Cost Estimates* Operating Cost Item BFS LOM Average Mining, haulage and operation of BLF1 A$7.07/t Transhipment activities A$6.71/t Site and administrative costs A$2.65/t Total Operating Costs (ex-royalties and ocean freight) A$16.42/t Royalties A$6.57/t Ocean Freight A$11.71/t Total O
Slide 27: Reserves & Resources
Reserves & Resources* Bauxite Hills – DSO Mineral Resource &Ore Reserve Estimates DSO Bauxite Qualities (Dry Basis) Area Category DSO2 Tonnes (Mt)1 Total Al2O3 (%) Total SiO2 BH1 & BH6 Measured Resource 54.7 50.0 11.9 BH1, BH2 & BH6 Indicated Resource 66.4 49.2 14.5 BH1 & BH6 Inferred Resource 23.7
Slide 28: Key Market End Users & Off-take
Key Market End Users & Off-take * Summary of Xinfa Off-take Binding off-take secured (Xinfa), China’s 2nd largest private bauxite importer. Term 4 years Agreement covers ~50% of first 4 years production with market linked pricing. Total Tonnage 7Mt Lubei LOI (non-binding) for 0.5-1.0mt pa for a
Slide 29: Attractive Debt Facility
Attractive Debt Facility Debt Financing Secured to Underpin Project Construction Quantum $40m Sprott Resource Lending Providers Ingatatus AG (a related party of Balanced Property) Term ~3 years Security Yes Coupon Low Flexible drawdown schedule Repayment Schedule No principal repayme
Slide 30: Bauxite Market Update
Bauxite Market Update Five (5) alumina refineries planned in China with a potential stage 1 capacity of 8-10Mtpa which could increase imported bauxite into China by 20-25Mtpa These planned refineries support the view that new refineries will be built in coastal locations to take advantage of the
Slide 31: For Further Information
For Further Information Contact: Simon Finnis – Chief Executive Officer & Managing Director Finance & Business Development – Duane Woodbury Ph: +61 (0) 7 3009 8000 Head Office: Lvl 2, 247 Adelaide Street, Brisbane Q 4000 GPO Box 10955, Brisbane Q 4000