Investor Presentation - Metro Mining€¦ · Investor Presentation. Highlights 2 | ASX : MMI ......

Investor Presentation

Highlights

2 | ASX : MMI | November 2018

1 Bauxite Hills Mine in production 10 months after construction commenced – as planned

2 Production Ramping Up – 25 Vessels and >1.6 million tonnes shipped to date

3 Upgrade strategy announced – 2019 forecast production of 3.5M Wet Metric Tonnes (WMT)

4 Long life mine delivering into a strongly growing Chinese market

5 Independent Cape York bauxite producer

6 Sales underpinned by a binding 4 year offtake agreement (~50% production) with Xinfa

7 Shipments made to a range of Chinese customers

19.8%

15.5%

10.2%

6.1%9.5%

38.9%

Corporate Snapshot Share Price Performance June 2016 – November 2018

Board of Directors

Independent Chairman Stephen Everett

Managing Director & CEO Simon Finnis

Independent Non-Executive Director Philip Hennessy

Independent Non-Executive Director Lindsay Ward

Non-Executive Director Mark Sawyer

Non-Executive Director Xiaoming (Aaron) Yuan


Share Register

Greenstone

Balanced Property

BlackRock

DADI

Other Institutions

Other Shareholders

Share Price (7 November 2018) A$0.155

Shares on Issue 1,383M

Market Cap A$214.4M

Options Unlisted 31M

Cash and Receivables (30-Sept-2018) A$38.2M

Debt Facilities A$41.2M

Enterprise Value A$217.4M

Capital Structure

$0.05

$0.10

$0.15

$0.20

$0.25

$0.30

$0.35

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0

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April* May June July August September October

Mo

nth

ly M

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g (

k w

mt)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

Ship

8

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2019 Expansion & UpgradeMonthly Mining Production

*Partial Mth - Mining began 17 Apr 2018

Da

ily

Sh

ip L

oa

din

g R

ate

s

Q3 Q4

▪ Strong customer demand drives improvement and upgrade

strategy – 2019 forecast production now 3.5M (WMT).

▪ Much of existing infrastructure designed for higher operating

levels making initiatives easy to implement and low cost.

▪ Cost of A$6.8M will include

▪ Supplementing the current truck and haulage fleet.

▪ Duplicating screening capacity at the BLF.

▪ Jaw crusher to treat oversized material.

▪ Supplementing marine fleet and infrastructure.

▪ Many of these initiatives were part of the long-term Stage 2

expansion to steady state production of 6.0M WMT pa.

(subject to DFS update and Board approval)

▪ Will result in greater economies of scale, a variety of

operational benefits and lower unit costs.


Metro Mining Q3 2018 Results

Bauxite Hills Production Results

Period July August September Sept Quarter June Qtr YTD

Bauxite Mined (WMT)(‘000) 285 277 297 859 445 1,304

Bauxite Shipped(WMT)(‘000) 253 297 272 822 399 1,221

Bauxite Mined

859,000 tonnes

26 Ships for year and Counting

Cash &

Receivables

$38.2Million

Bauxite Shipped

822,000 tonnes

Revenue

$43.8 Million


Metro Mining Q3 2018 Unit CostsCosts Average

A$46 / WMT

Opportunities Identified to Reduce Costs in 2019

Higher Volumes will

have a positive impact

Month on Month

Reductions

Lower A$

Impacted Freight

Unit Operating Costs

Costs July Aug Sept Sept Qtr

Site Cost A$/WMT 24.51 24.25 22.44 23.73

Non-Site Cost

▪ Freight A$/WMT 16.60 16.99 18.42 17.34

▪ Royalties A$/WMT 6.30 5.02 4.69 5.31

TOTAL 47.42 46.26 45.54 46.38

▪ Ramp-up on schedule.

▪ Bauxite has been shipped

to 5 different Chinese

Customers.

▪ During the Quarter,

production was consistently

achieving budgeted

operating rates on a daily

basis.

▪ Transhipment activities

are performing in line

with expectations.

▪ Bauxite market penetration

increasing, sales ongoing.

▪ Production Guidance for

CY2018 is maintained.


2018 Production Guidance Update

BH1 Mining Area

Bauxite Production Guidance (WMT)

Bauxite Mined

(‘000t)

Jun ’18 Qtr Actual

Sept ’18 QtrActual

Dec ’18 QtrForecast

2018 – CYForecast

2019 – CYForecast

445 859 651 – 746 1,980 – 2,075 3,500

Bauxite Shipped

(‘000t)399 822 759 – 854 1,980 – 2,075 3,500

Stage 2

Increasing Production Profile


▪ Ramp up over 4 years reflects

development of the customer

base. Production in excess of

existing off-take will include spot

sales and/or new off-take.

▪ Expansionary capital expenditure

estimated at approximately $37M1

(NB: to be confirmed through updating the DFS).

▪ Significant unit cost improvement

at higher production rates

▪ Existing infrastructure has been built

to facilitate higher production rates

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

2018 2019 2020 2021

Stage 1

▪ Subject to Board Approval

▪ Estimated Capital costs of $37M1

1. ASX Release 15 Mar 2017

Tonnes Per

Annum

Key Statistics 1

Pro

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t O

ve

rvie

w

Ownership: Metro (100%)

Commodity Bauxite

Location: Cape York, Qld

Product Type Direct Shipping Ore

Contained Mineral: Reserves 92.2Mt1 Resources 144.8Mt1

Mine Type Surface mining

Status Operational

Op

era

tio

na

l O

ve

rvie

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First Production April 2018

Start-up Production ~2Mtpa

Steady State Production2 ~6Mtpa (year 4)

Mine Life 17 years

Operations Contract mining & transhipment

Workforce ~185 personnel

1.ASX Release 15 Mar 2017 2. subject to Board approval of expansion to stage 2

Bauxite Hills Mine SnapshotLo

ca

tio

n



Simple DSO Project◼ Operational simplicity and specialist mining and transhipment contractors means an easy to manage operation

◼ Dry season only operations negate the risk of weather impact

◼ Site location, geological setting and layout provides low operating costs

Clear vegetation &

remove overburden

Strip mine bauxite

Return overburden & replace

topsoil - then revegetate

Mottled Zone

Ironstone

DSO Bauxite Horizon (~1.75m)

Overburden (~0.5m)Min

ing

Log

istic

s

AirstripCamp Site

11 | ASX : MMI | May 2018

Bauxite is the Primary Ore of AluminiumKey Ingredient for Manufacturing Aluminium

4-6 tonnes bauxite 2 tonnes alumina 1 tonne aluminium= =

Key Bauxite Value Drivers

Grade Alumina content ranges from 30% - 65% and silica ranges from 2% - 30%

Location Proximity to buyer, supply reliability and sovereign risk

12 | ASX : MMI | May 2018

China vs ROW Primary Aluminium Capacity 2000–2017 (Mtpy)

86%84%

81%

76%74% 72%

69%

63% 62%

56%55% 52%

47% 44% 42%41% 40% 40%

25.827.2

28.6

31.233.5 35.3

37.5

41.8 44.2

45.9 49.751.6

56.562.6

67.070.4 75.3 79.4

14%3.5

16%4.2

19%5.4

24%7.4

26%8.8

28%9.7

31%11.7

37%15.4

38%16.8

44%20.0

45%22.4

48%24.6

53%30.1

56%35.3

58%38.7

59%41.7

60%44.9

60%47.9

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Pe

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ROW Al Capacity(MT) World Total Al Capacity(MT) China's Al Capacity(MT)

Source: IAI, CM Analysis

13 | ASX : MMI | May 2018

Map of China’s Major Alumina & Primary Aluminium BasesSource: CM Group

China’s top 11 primary Al

production provinces

1. Shandong

2. Xinjiang

3. Inner Mongolia

4. Henan

5. Gansu

6. Qinghai

7. Yunnan

8. Ningxia

9. Guizhou

10.Shanxi

11.Guangxi

Liaoning Province

is emerging as a

major player, with

three projects planned

or under construction

China’s Main Bauxite Concentration

China’s major

alumina producing

provinces:

1. Shandong

2. Shanxi

3. Henan,

4. Guangxi

5. Guizhou

6. Inner Mongolia

Aa Capacity >1,000 KYPY

Aa Capacity <1,000 KYPY

Al Capacity >500 KYPY

Al Capacity <500 KYPY


China Demand Outlook Remains Strong

Source: CM Group

15 | ASX : MMI | August 2018

China’s 2017 Bauxite Imports

▪ Guinea now largest

supplier to China

driven by exports from

the Chinese-controlled

SMB-WAP

▪ Australia's supply

is steadily growing, up

4.2Mt (20%) in 2017 to

25.5Mt

▪ Indonesia and

Malaysia now less

relevant

▪ Ocean freight on an

upward trend

▪ H1 2018 Bauxite imports

estimated at 40.5MtSource: China Customs, CM


Favourable Price DynamicCBIX Weighted Daily Price VS Alumina Price Index

2000

2500

3000

3500

4000

44.0

48.0

52.0

56.0

60.0

64.0

68.0

72.0

Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18

Ala

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)

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aily

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igh

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/DM

T)

AladdinyCBIX


Positive Community Relationships A “Welcome to Country Ceremony” has been held at Bauxite Hills Mine.

Major Ankamuthi family groups plus Metro’s Chair, Stephen Everett, Managing

Director, Simon Finnis and Metro employees attended.

Official Welcome Ceremony performed by Ankamuthi Elder George Williams

Current Indigenous employment is 37% (Target 20%)

Ankamuthi Elders George Williams and Richard Woosup and Metro’s Environmental heritage Support Officer Barunah “Bruno” Sagiba

Ankamuthi Elder, George Williams, is welcomed by Metro personnel


Summary – A Compelling Opportunity

1 Metro has moved from Developer to Operator

2 Production has ramped-up according to plan

3 Long-life mine supplying bauxite from a stable jurisdiction

4 Strong seaborne bauxite market to China driving positive price and demand

5 Growing exports and production rates provide ongoing value creation

6 Australia’s leading independent bauxite producer with strategic appeal

For Further Information

Contact: Simon Finnis – Chief Executive Officer & Managing Director | Chief Financial Officer – Duane Woodbury

Ph: +61 (0) 7 3009 8000 | Head Office: Lvl 2, 247 Adelaide Street, Brisbane Q 4000 | GPO Box 10955, Brisbane Q 4000


FORWARD LOOKING STATEMENT

Statements and material contained in this ASX Announcement, particularly those regarding possible or assumed future performance, production levels or rates, commodity prices, resources or potential growth of Metro

Mining Limited, industry growth or other trend projections are, or may be, forward looking statements. Such statements relate to future events and expectations and, as such, involve known and unknown risks and

uncertainties. Graphs used in this ASX Announcement (including data used in the graphs) are sourced from third parties and Metro Mining has not independently verified the information. Metro Mining is at an early

development stage and while it does not currently have an operating bauxite mine it is taking early and preliminary steps (such as but not limited to Prefeasibility studies etc.) that are intended to ultimately result in the

building and construction of an operating mine at its project areas. Although reasonable care has been taken to ensure that the facts stated in this ASX Announcement are accurate and or that the opinions expressed

are fair and reasonable, no reliance can be placed for any purpose whatsoever on the information contained in this document or on its completeness. Actual results and developments may differ materially from those

expressed or implied by these forward-looking statements depending on a variety of factors. Nothing in this ASX Announcement should be construed as either an offer to sell or a solicitation of an offer to buy or sell shares

in any jurisdiction.

COMPETENT PERSON’S STATEMENT

The information in this ASX Announcement that relates to Exploration Results is based on information compiled by Neil McLean who is a consultant to Metro Mining and a Fellow of the Australian Institute of Mining and

Metallurgy (F.AusIMM). Mr. McLean has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as

defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr. McLean consents to the inclusion in the report of the matters based on information in the

form and context in which it appears.

COMPETENT PERSON’S STATEMENT

The information in this ASX Announcement to which this statement is attached that relates to the “Metro Mining – Bauxite Hills” Reserves is based on information compiled by MEC Mining and reviewed by Edward Bolton, a

Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy. Edward Bolton is a full-time employee of MEC Mining Pty Ltd. Edward Bolton has sufficient experience that is relevant to the style

of mineralization, type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results,

Mineral Resources and Ore Reserves’. Edward Bolton consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Disclaimer

Investor Presentation - Metro Mining€¦ · Investor Presentation. Highlights 2 | ASX : MMI ......

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