Endeavour Mining Plc · TSX:EDV
Endeavour Mining — Investor Presentation (October 2010)
33 slides from Endeavour Mining's investor presentation, October 2010
Slide 1: Endeavour's Growth Plan
Endeavour’s Growth Plan October, 2010 A gold company TSX‐Listed, Symbol EDV
Slide 2: Forward-looking Information
Forward‐looking Information This presentation may contain forward‐looking information relating to the future performance of Endeavour Mining. Forward‐looking information, specifically those concerning future performance, are subject to certain risks and uncertainties, and actual results may differ m
Slide 3: Company Snapshot
Company Snapshot A gold production growth company Common Shares Listed on TSX, symbol EDV Shares Outstanding: 113.3 million (159.8 million fully diluted) Market Capitalization: US$320 million Cash US$180 million Undrawn Debt Facility US$100 million L‐T Debt US$29 million, at 90% owned Yo
Slide 4: Mine and Project Locations
Mine and Project Locations • West African Focus • Operating Mine – Youga, Burkina Faso • Feasibility Stage • Agbaou, Côte d’Ivoire • Finkolo JV, Mali Mali West Mali • Priority Exploration Youga Gold Belt – • Youga Mine Resource Expansion Mali South Burkina Faso Ouaré (40 km NW of Youga) • Youga Mine
Slide 5: Endeavour is a gold mining company with a growth plan
Endeavour is a gold mining company with a growth plan CURRENTLY PRODUCING GOLD AT A RATE OF 80,000 ozs per year • Endeavour owns 90% of the Youga gold mine in Burkina Faso • Youga resource expansion program underway ORGANIC GROWTH • Agbaou Feasibility Stage project, one of the largest undeveloped go
Slide 6: Youga Mine – Burkina Faso
Youga Mine – Burkina Faso • Reserves of 5.9 million t at 2.7 g/t containing 474,000 ozs (100% basis) • Open pit operation with a 1 million tpa CIL plant with 93% gold recovery • Annual production forecast of 80,000 ozs • LOM average cash cost of $580/oz • Endeavour applied its financial and operatio
Slide 7: Youga Mine: Turn-around Key Metrics
Youga Mine: Turn‐around Key Metrics * +20% increase -29% reduction * Cash operating costs, excluding royalties ENDEAVOUR MINING 7
Slide 8: Youga Mine: Gold Production Profile
Youga Mine: Gold Production Profile 25,000 Est. production 80,000 ounces in fiscal 2010 20,000 64,879 ounces in fiscal 2009 15,000 Ounces 10,000 5,000 0 Dec/08 ‐ Mar/09 ‐ Jun/09 ‐ Sep/09 ‐ Dec/09 ‐ Mar/10 ‐ Jun/10 ‐ Sep/10 ‐ Feb/09 May/09 Aug/09 Nov/09 Feb/10 May/10 Aug/10 Nov/10 ENDEAVOUR MINING 8
Slide 9: Youga Mine: Reducing Operating Cash Costs
Youga Mine: Reducing Operating Cash Costs • Mining Costs o Contractor operating with greater efficiency o Better grade control, less dilution and loss • Plant Costs o Lower power costs with grid power vs. gensets o Solved CIL tank sanding problems o Improved supply of warehouse parts and critical sp
Slide 10: Youga Mine: Resource Expansion Program
Zergoré & A2NE • Hole YNRC-005 at A2NE: 21m of Youga Mine: Resource Expansion Program 2.0 g/t (incl. 4.0m of 5.5 g/t) • Hole YZRC-087 at Zergoré: 19m of 4.0 g/t (incl. 1m at 10.0 g/t) All resources at 0.5 g/t cut‐off referenced in Appendix 2. Measured and Indicated: 6,738,000 t @ 2.3 g/t (482,000 oz
Slide 11: Youga Gold Belt: Ouaré Zone
Youga Gold Belt: Ouaré Zone Background Ouaré Zone located 40 km NE of Youga mine Historic drilling by Ashanti on Main Zone Endeavour encountered high grade mineralization in East Zone Program Objectives Increase resource at Ouaré Main and East from 323,000 to >500,000 oz Make new discoveries at Ouar
Slide 12: Priority Exploration – Côte d'Ivoire
Priority Exploration – Côte d’Ivoire Randgold 2.4M oz Principal land package in under development eastern sedimentary basin Extension of greenstones from western Ghana Cluff 40,000 oz/yr in production In addition to Agbaou, permits granted (red) and permit applications La Mancha 50,000 oz pour
Slide 13: Agbaou Gold Project: Côte d'Ivoire
Agbaou Gold Project: Côte d’Ivoire • One of the largest undeveloped gold deposits in Côte d’Ivoire • Located ~200 km NW of Abidjan • 22 km from Newcrest’s Bonikro mine • Superior infrastructure in region • 85% Endeavour, 10% State, 5% SODEMI • Reserves 731,000 ozs (10.9M t @ 2.1g/t) • Recovery 91% •
Slide 14: Agbaou Gold Project: Site Plan
Agbaou Gold Project: Site Plan • Mining Permit application submitted Oct 2009 • Environmental & Social Impact Study Blue lines denote 20,000m approved Dec 2009 drill program • Authorization to perform preliminary work received Sept 2010 o 20,000 metre drill program being contracted (US$1.5 million b
Slide 15: Operational Summary
Operational Summary Production o Producing 80,000 ounces of gold at Youga in 2010 o Reducing operating costs Development o Securing Agbaou mining permit grant o Preliminary work program – in progress o Increasing proven ore reserves Exploration o Identifying additional mineral resource/reserves alon
Slide 16: Endeavour Mining's Objective
Endeavour Mining’s Objective • Grow into an intermediate gold producer through strategic acquisitions • Growth strategy supported by: o Management’s company building expertise o Positive operating cashflow from our Youga gold mine o Exploration programs fully funded o US$180 million of cash o Undraw
Slide 17: Size matters!
Size matters! Illustrative Investment Gains Climbing the P/NAV Rating Ladder Starting with investments in Junior producers, then combining to achieve Intermediate re‐rating Further upside from: Rising Gold price Return to P/NAV Premium Multiples “Normalized” Markets (P/NAV : +100%) Int. Producer (P/
Slide 18: Acquisition Criteria & Approach
Acquisition Criteria & Approach • Seeking gold production • Focus on quality assets • Transaction driven and financially oriented • Dynamic market with constantly evolving opportunities • Utilize our extensive industry relationships and network ENDEAVOUR MINING 18
Slide 19: Endeavour Mining's Advantage
Endeavour Mining’s Advantage • Highly skilled and motivated management team o Proven transaction and company‐building track record • As an advisor and investor, Endeavour participated in the creation and launch of several growth companies, including: Wheaton River Minerals (now Goldcorp) Silver Whea
Slide 20: Endeavour Mining's Financial & Treasury Services Team
Endeavour Mining’s Financial & Treasury Services Team • In‐house M&A, Debt and Equity Finance team complements operations • This team is integral to our success and acquisition strategy • Over the last three years: o Arranged US$4.1 billion of debt & equity finance o Advised on M&A transactions valu
Slide 21: Crew Transaction – Case Study on Agility
Crew Transaction – Case Study on Agility • Acquired a 43% interest in Crew Gold in Q1 2010 for US$134.5 million • Investment sold in September 2010 to Severstal Gold for US$215 million cash • Profit of US$80.5 million generating 124% IRR • Opportunity to exit Crew investment at a significant profit
Slide 22: Baja Transaction – Case Study on Intellectual Capital
Baja Transaction – Case Study on Intellectual Capital • Baja Mining is developing Mexico’s largest Copper/Cobalt deposit • September 2010, Endeavour closed US$858 million in debt facilities with the following lenders: Export‐Import Bank of the United States Standard Bank Plc Export Development Canad
Slide 23: Etruscan Transaction – Case Study on Mining Business Acumen
Etruscan Transaction – Case Study on Mining Business Acumen • September 2009, Etruscan Resources faced severe financial and operational difficulties • Endeavour became 55% shareholder of Etruscan investing US$43 million and purchasing a $12.6 million block • Endeavour: o Restructured Etruscan’s bank
Slide 24: Endeavour's share price is building momentum
Endeavour’s share price is building momentum CDN$3.00 CDN$2.80 CDN$2.60 CDN$2.40 CDN$2.20 CDN$2.00 CDN$1.80 CDN$1.60 CDN$1.40 CDN$1.20 Mar-2009 Jun-2009 Sep-2009 Dec-2009 Mar-2010 Jun-2010 Sep-2010 Closing share price on the Toronto Stock Exchange, Last data point: 6 Oct 2010 ENDEAVOUR MINING 24
Slide 25: Concluding Comments
Concluding Comments • A new gold production company with an aggressive growth strategy • Significant cash position and balance sheet • Attractive valuation • Strong acquisition track record • Joined the gold producer peer group o Increased research coverage, conferences and roadshows o Operating com
Slide 26: Appendix 1: Management & Directors
Appendix 1: Management & Directors Neil Woodyer – Director, CEO Mr. Woodyer was a founding partner of Endeavour in 1988. He is responsible for implementing the corporation’s strategic growth plan and co‐coordinating and directing the entire management and professional team. Mr. Woodyer has extensive
Slide 27: Appendix 1: Management & Directors
Appendix 1: Management & Directors Jorge L. Gamarci – Director Mr. Gamarci is a member of several corporate boards. He has held numerous senior executive positions during his 30 plus year banking career, including Managing Director at UBS Securities LLC, , Senior Vice President, International Treasu
Slide 28: Appendix 1: Management – Operations
Appendix 1: Management – Operations Dr. Sally Eyre – Senior Vice President, Operations Based in Endeavour’s executive office in Monaco, Dr. Eyre has over 18 years experience in the global resource sector and is responsible for the management of the corporation’s mining operations. She has a Ph.D in
Slide 29: Appendix 1: Management – Technical Services
Appendix 1: Management – Technical Services The Technical Services team provides mine and project technical analysis, financial analysis, strategic modeling and research services to the corporation. The Technical Service team is distinct from the Operations team and is focused on supporting the corp
Slide 30: Appendix 1: Management – Investment Relations
Appendix 1: Management – Investment Relations Stephen Roberts – Director, Investor Relations Mr. Roberts has over 15 years experience in the financial services industry. He began his career as an FX salesman with Bank of America, then relocated to London, U.K. in 1998 and spent 11 years at Credit Su
Slide 31: Appendix 2: Reserve & Resource Summary
Appendix 2: Reserve & Resource Summary PROJECT RESERVES RESOURCES RESOURCES Proven & Probable (M&I) Inferred Youga (90%)1 474,000 oz 709,000 oz 111,000 oz Youga Satellites 128,000 oz 62,000 oz (Nanga, Tail)2,3 Ouaré4 323,000 oz Agbaou (85%)5 731,000 oz 1,015,000 oz 272,000 oz Finkolo (40%)6,7 237,00
Slide 32: Appendix 2: Reserve & Resource Notes
Appendix 2: Reserve & Resource Notes 1 Youga Mining Study – October 2006 Update, Youga Gold Project, Burkina Faso, West Africa dated October 2006, prepared by RSG Global (Pty) Ltd. And MDM Ferroman (Pty) Ltd. Updated by Etruscan as of December 2009 (using US$700 gold price, 5% mining dilution and 97
Slide 33: Appendix 3: Endeavour's Capital Structure
Appendix 3: Endeavour’s Capital Structure As of Sept. 13, 2010 Issued Common Shares 113,266,237 EDV Options (Strike prices up to CDN$2.45) 8,794,000 at avg. strike of CDN$1.95 EET Options* (Strike prices up to CDN$2.47) 1,132,426 at avg. net strike of CDN$1.91 EDV Warrants – CDN$2.50 strike (EDV.WT.
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