International Capital Markets...2019/08/05 · Feb 2016 Yanfolila Gold Project DFS (US$1,250 AU)...
Transcript of International Capital Markets...2019/08/05 · Feb 2016 Yanfolila Gold Project DFS (US$1,250 AU)...
CORPORATE PRESENTATION
August 2019 Corporate Presentation
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DISCLAIMER
These presentation slides have been prepared by, and are the sole responsibility of, the directors of Hummingbird Resources plc (“Hummingbird Resources” or the
“Company”). Those directors have taken all reasonable care to ensure that the facts stated herein are true to the best of their knowledge, information and belief. The
information in this document is subject to updating, revision and amendment. This document neither constitutes nor forms nor should be constructed as constituting or
forming part of any offer or invitation to sell or any solicitation of any offer to purchase or to subscribe for any securities in Hummingbird Resources or any other body
corporate or an invitation or inducement to engage in investment activity under section 21 of the UK Financial Services and Markets Act 2000 nor shall it or any part of
it form the basis of or be relied on in connection with any contract therefore. This document does not constitute an invitation to effect any transaction with
Hummingbird Resources nor to make use of any services provided by Hummingbird Resources. No reliance may be placed for any purpose whatsoever on the
information contained in this document nor on assumptions made as to its completeness. No representation or warranty, express or implied, is given by Hummingbird
Resources, any of its subsidiaries or any of its respective advisers, officers, employees or agents, as to the accuracy, fairness or completeness of the information or
opinions contained in this document or expressed in the presentation and, no liability is accepted for any such information or opinions (which should not be relied
upon) or for any loss howsoever arising, directly or indirectly, from any use of this document or its contents or information expressed in the presentation.
The information and opinions contained in this document and the presentation are provided as the date of this document and the presentation and are subject to
change without notice.
This presentation contains forward-looking statements that are based on Hummingbird Resources’ current expectations and estimates. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated
events or results implied or expressed in such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made and
Hummingbird Resources disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or
otherwise. Forward-looking statements are not guarantees of future performance and, accordingly, undue reliance should not be put on such statements due to the
inherent uncertainty therein.
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A MULTI-ASSET AFRICAN GOLD PRODUCERMALI
Yanfolila Gold Mine
Bamako Office
Monrovia office
Dugbe Gold Project
• A producer with significant gold inventory of over 6Moz across two projects in West Africa
- Guidance of 110-125Koz gold production in 2019
• Significant stake in growing exploration firm
• Experienced team with a track record of delivery
• Strong in-country relations with two pro-mining governments
WITH STRATEGIC FRAMEWORK TO DELIVER VALUE & GROWTH
LIBERIA
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THE STORY TO DATE
2005
Founded
by Dan
Betts to
explore in
Liberia
2014
Dugbe
Resource
grows to
4.2Moz Au
Feb 2016
Yanfolila Gold
Project DFS
(US$1,250 AU)
NPV=US$162m
IRR=60%
2010
Listed on
AIM with
812koz Au
Resource:
Dugbe
2014
Acquisition of
Yanfolila Gold
Project from
Gold Fields for
US$20m
June 2016
US$76m
equity raised
to fund
construction
M&A opportunities, greenfield & brownfield exploration and growing production
Jul 2018
Exploration
drilling begins
at Yanfolila
across a
number of
deposits to
target LoM
increase
April 2018
Commercial
production
begins
A DISTINCTIVE & FOCUSED JOURNEY FROM EXPLORERS TO PRODUCERS
Dec 2017
First gold
pour at
Yanfolila
Gold
Mine
Oct 2017
Plant and TSF
construction
complete
2019
110,000 –
125,000 oz
forecast in
2019
May-July
2019
2nd Ball
Mill
complete
& MDA at
Dugbe
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GROW VALUE
Cash flow generation
Capital allocation
discipline
M&A
Balance sheet
strength
HIGH MARGIN GOLD COMPANY FOCUSED ON SHAREHOLDER VALUE
STRATEGIC FRAMEWORK TO DELIVER VALUE & GROWTH
PRODUCE
110-125Koz 2019
guidance
High margin
production
EXPLORE
Disciplined investment
in brownfield and
greenfield targets
Conversion of
Resources to Reserves
DEVELOP
Proven on time and on
budget developers
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SEASONED MANAGEMENT & ADVISORS WITH A WEALTH OF EXPLORATION, DEVELOPMENT & OPERATIONAL EXPERIENCE
SENIOR MANAGEMENT & COMMITTEES
SENIOR VP PROJECT DELIVERY
SENIOR MANAGEMENT
Sa idou IdéGM, F inance & Admin
2 0 y r s ’ e x p e r i e n c e i n c l s e n i o r
p o s i t i o n s a t R e s o l u t e , G l e n c o r e &
A v o c e t . S u p e r b j u r i s d i c t i o n
k n o w l e d g e & r e l a t i o n s
Ber t MonroHead Bus iness Deve lopment
J o i n e d 2 0 0 9 , P r e v i o u s l y a N o n -
E x e c D i r e c t o r
o f C o r a G o l d & 8 y e a r s a s H e a d o f
B D
Shaun BunnSen ior VP P ro ject De l ivery
O v e r 3 0 y r s ’ e x p e r i e n c e i n
e x p l o r a t i o n , m i n i n g , p r o c e s s i n g &
p r o j e c t d e v e l o p m e n t a c r o s s A f r i c a
Wayne Galea
VP EPCMO v e r 3 0 y r s ’ e x p e r i e n c e f o r l e a d i n g
e n g i n e e r i n g c o m p a n i e s , i n c l u d i n g
A M E C , B a t e m a n & S i g n e t
Dan Betts
CEOTom Hil l
F inance Director
Murray Pate rsonVP Geo logy
O v e r 2 0 y r s ’ e x p e r i e n c e a s a
m i n e , m i n e r a l r e s o u r c e &
e x p l o r a t i o n g e o l o g i s t
Kate Harcourt
CHAIREdward B ickham
ENVIRONMENT, SOCIAL &
GOVERNANCE COMMITTEE
Kate Harcourt
E rn ie Nut terNon -Ex e c u t i v e
D i r ec to r
Dav id Lun t
CHAIRAt t ie Roux
Non -Ex e c u t i v e
D i r ec to r
TECHNICAL ADVISORY
COMMITTEE
John Meneghin i
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CAPITAL STRUCTURECOMPETITVE VALUATION & STRONG ANALYST COVERAGE
AT A GLANCE: AIM:HUM
Market Cap (at 06.08.19) US$ 106M
Cash balance (at 30.06.19) US$ 8M
Debt repaid during Q2 US$ 5M
Debt total at end Q2 US$ 51M
Ordinary shares in issue 353,688,201
S I G N I F I C A N T S H A R E H O L D E R S
C A N A C C O R D G E N U I T Y M I R A B A U D
B R O K E R C O V E R A G E
Sustainable
Capital
12%
Gold Fields
6.2%Odey
6%
Majedie
5.4%
Aberdeen
Standard
5%
Management
3.2%
M&G 6.4%Jupiter
3%
Other
57%
C E N K O S
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UNDERVALUED AGAINST OUR PEERS
PEER COMPARISON
Source: Thomson Reuters and Canaccord Genuity LimitedNote: prices as at 07/08/19
nm
0.20x
0.40x
0.60x
0.80x
1.00x
1.20x
P/NAV
$-
$100
$200
$300
$400
$500
$600
EV/Resource ($/oz)
MALI’S NEWEST GOLD PRODUCER
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THE YANFOLILA GOLD MINE
• Built on time and on budget
• High grade deposit: Pre-production Reserve base
of 710koz at 3.14 g/t and over 2Moz Resource
• Carbon-in-leach process plant with current
blended ore throughput capacity of up to 1.4
Mtpa
• Significant scope to increase Reserve base and
Life of Mine through on-going near mine
exploration
• High local workforce rates & local training
programmes ongoing
MALI’S NEWEST GOLD MINE
25% WOMEN PLANT OPERATORS
95% LOCAL WORKFORCE
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Q2 2019 PERFORMANCE
• Q2 2019 production of 27,466 oz , 15% increase from
last quarter
• AISC of US$998/oz, 23% decrease on last quarter
• Average mill grade of 2.86g/t
• Full year guidance of 110-125Koz
• Second ball mill completed on time and budget
WITH QUARTERLY PRODUCTION FIGURES TO DATE
9981,297
1,677
1,006
Q2 2019Q1 2019Q4 2018Q3 2018
Quarterly AISC (US$/oz)
27,46623,807
17,895
22,206
Q2 2019Q1 2019Q4 2018Q3 2018
Quarterly Gold Production (oz)
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INCREASING PLANT THROUGHPUT TO FACILITATE ANTICIPATED RESERVE GROWTH
SECOND BALL MILL
• Construction successfully completed within Q2 2019 on time
and budget
• To increase plant throughput from 1.24Mtpa to 1.4Mtpa based
on a blend of ore types
• When operating at 100% fresh ore, the throughput capacity
will increase from 1Mtpa to 1.24Mtpa and 1.24Mtpa to
1.4Mtpa for blend of ore
• The preferential choice when considering the alternative
option of installing a tertiary crusher, per the DFS
DEVELOP & EXPLORE: YANFOLILA
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KOMANA EAST & WEST RESERVES & RESOURCES
KOMANA WEST PIT
CURRENT GOLD INVENTORY
Category Tonnes (t) Grade (g/t) Gold (oz)
Pre-production Reserve 7,039,000 3.14 709,800
Total Mineral Inventory * 27,952,200 2.23 2,005,300
*Including non-JORC compliant figures at 31 March 2019
KOMANA EAST PIT
SIGNIFICANT RESOURCES TARGETED FOR RESERVE CONVERSION
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YANFOLILA MINE LIFE UPSIDE
Over 1Moz of Indicated and Inferred Resources
outside the current mine plan. Historical
Resource to Reserves conversion rate of 55%
Exploration Programme to convert significant
Resources to Reserves
1. Gonka: High grade Inferred deposit situated 5km from the plant
2. Komana East & West: Underground potential not currently in Reserves
3. Sanioumale East & West: Currently only oxide ore in the mine plan
Guirin West
EXCELLENT
DRILL RESULTS:
Komana West:
11.45m @ 8.6g/t
25.75m @ 2.95g/t
Gonka:
15m @ 16.03g/t
20.05m @ 4.63g/t
For full results visit the
news page on our
website
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ESTABLISHING A DOMINANT POSITION CLOSE TO THE YANFOLILA GOLD MINE
CORA GOLD: MALI EXPLORATION
Sanankoro:
17m @ 5.43g/t
11m @ 5.24g/t
DRILL RESULTS
• Hummingbird is a significant shareholder
• IPO October 2017(AIM:CORA.L)
• Focused on two regions: Mali and Senegal, West Africa
• Proven team with comprehensive track record, incl.
<8Moz of discoveries across 7 different African gold
projects
• Exploring in Mali region with potential routes for early
processing of ore
• Sanankoro Gold discovery potential for a 1-2Moz
standalone gold mine
• Tekeledougou discovery located 8km from Yanfolila
process plantTekeledougou:
56m @ 2.2g/t
17m @ 6.8g/t60m @ 0.7g/t
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LIBERIA
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OPTIONALITY AND SCALE TO DRIVE PORTFOLIO GROWTH
DUGBE GOLD PROJECT: LIBERIA
DUGBE
• Liberia’s largest gold deposit of 4.2Moz
• Mineral Development Agreement (‘MDA’) passed into
law by Government of the Republic of Liberia in Q2 2019
• Situated just 70km from Greenville deep water port and
accessible by road
• Attractive economics
• Long Life of Mine @ 20 years
• High annual production forecast of 125Koz gold
• Strategy to now look towards taking the next steps at
Dugbe in the best interests of all stakeholders.
DISCOVERING & OPERATING IN LIBERIA
• Dugbe Shear zone a highly attractive mining region
• Pro-mining government
• Mining law based on Australian mining regulation
• Favourable fiscal regime: expected 3% royalty &
25% basic tax rate
• Mining contributes to 10% of economic growth
• Liberia remains democratic since political stability
was restored in 2003
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A LARGE-SCALE RESOURCE WITH STRONG ECONOMICS
THE DUGBE GOLD PROJECT
• 4.2Moz gold @ 1.4g/t
• 2,355km² of ground within Mineral Development
Agreement (MDA) for 25 years, with over 140 targets
• PEA at US$1,300 gold with IRR of 29% & NPV (10%) of
US$186m
DUGBE F RESOURCE• 1.76Moz @ 1.28 g/t Inferred
TUZON RESOURCE• 2.47Moz, including:
- 2.03Moz @ 1.51 g/t Indicated- 0.44Moz @ 1.32 g/t Inferred- plus 15% better grade – PEA, was based on 1.3g/t
• Shallow folding ore body• Low Strip ratio • Resource open at depth
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BEST IN CLASS – RESPONSIBLE MINING
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BUILDING A LASTING LEGACY & MAKING A SUSTAINABLE CONTRIBUTION TO OUR LOCAL COMMUNITIES
RESPONSIBLE MINING
A TARGETED, YEAR-ROUND PROGRAMME TO ENHANCE
LOCAL LIVING. IN 2018 WE:
• Pay the salaries of 12 local teachers
• Established additional market gardens to create alternative
livelihoods and generate an income for local women, with
ability to employ 50+ people per garden
• Established further soap-making enterprises to benefit 10 local
communities and 300 women
• Invested in initiatives to provide clean drinking water across
villages local to Yanfolila
• Run on-going training programmes between UK-qualified
doctors and local nurses on essential medical techniques,
such as new-born resuscitation
• Built a brand new health centre in local village of Bougoudale,
to benefit population of approx. 5,000
• Established poultry projects across 4 villages, to contribute to
youth employment and socio-economic development
SUMMARY
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• Strong future cash flow from Yanfolila Gold Mine
• Significant gold inventory, with total 6.2Moz in
West Africa
• Large scope to increase LoM at Yanfolila
through increased plant throughput & nearby
exploration campaign
• Additional Mali exposure through investment in
Cora Gold
• Positioned for further growth through M&A
• Backed by strong institutional shareholders
• Team with proven track record
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A COLLECTION OF SINGLE MINE ORIGIN PURE GOLD COINS, ORIGINATING FROM YANFOLILA, ON SALE NOW
THE “HUMMINGBIRD 1OZ” COIN
Collectable coins representing HUM's
industry, journey and company values:
Explore; Develop; Mine; Produce;
Community; and Conserve
Priced based on the spot gold price at
the time of purchase
Minted at Betts Metals, HUM CEO Dan
Betts’ family 260 year old gold refining
and trading company in Birmingham1oz pure gold coin
www.bettsinvestments.co.uk
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BOARD OF DIRECTORS
Russel l KingNon-Execut ive Chairman
• Senior Independent Non-Exec of Aggreko
Plc
• Former Chief Strategy Officer at Anglo
American & member of the Executive
Committee for 8 yrs
• Former Senior Advisor to RBC on Metals &
Mining
Dan BettsCEO• Founded Hummingbird in 2005
• Developed the business from a private
explorer to a listed company with 6Moz+ gold
• 18 years’ previous experience in metals
industry
• Former Management Consultant at
Accenture in 2000
Att ie RouxNon-Execut ive Di rector
• 42 years operational , technical and
executive experience
• Former COO of Endeavour Mining
• Chairman of the TAC
Ernie NutterNon-Execut ive Di rector
• Mining analyst formerly with Capital Group
• Former Director and Managing Director of
RBC Capital Markets
• Former Chairman of RBC Dominion Securities
• BSc Geology
SHAUN BUNN
SENIOR VP PROJECT DELIVERY
David Straker-SmithNon-Execut ive Di rector
• Director of London-based investment
research and advisory firm, CrossBorder
Capital Ltd
• Director of New Vision Management Ltd and
Nomad Energy UK Ltd
• Former positions at ING Barings Securities Ltd
and Gerrard & National Holdings Plc
Tom Hi l lF inance Di rector
• Former Senior Manager within BDO
LLP’s natural resources department
• Metallurgy, Economics &
Management Oxford university
graduate
• 12 years’ experience in the resource
sector
Stephen BettsNon-Execut ive Di rector
• Over 40 years’ experience in trading
with gold and related businesses in
developing countries
• Chairman of the Stephen Betts group
of companies
• Established several businesses in West
Africa during his career
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Hummingbird Resources Plc
hum_gold
@HUM_gold
Hummingbird Resources Plc
+44 (0)20 7409 6660
www.hummingbirdresources.co.uk