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John A. McCluskeyPresident and Chief Executive Officer
Annual Meeting of ShareholdersJune 3, 2015
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Cautionary NotesCautionary Notes
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.
Certain statements in this presentation are “forward-looking statements”, including within the meaning of the United States Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact included in this presentation, including without limitation statements regarding forecast gold production, gold grades, recoveries, waste-to-ore ratios, total cash costs, potential mineralization and reserves, exploration results, and future plans and objectives of Alamos, are forward-looking statements based on forecasts of future operational or financial results, estimates of amounts not yet determinable and assumptions of management that involve various risks and uncertainties. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects” or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “estimates” or “intends”, or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be “forward-looking statements.” Alamos cautions that forward-looking information involves known and unknown risks, uncertainties and other factors that may cause Alamos's actual results, performance or achievements to be materially different from those expressed or implied by such information, including, but not limited to, gold and silver price volatility; fluctuations in foreign exchange rates and interest rates; the impact of any hedging activities; discrepancies between actual and estimated production, between actual and estimated reserves and resources or between actual and estimated metallurgical recoveries; costs of production; capital expenditure requirements; the costs and timing of construction and development of new deposits; and the success of exploration and permitting activities. In addition, the factors described or referred to in the section entitled “Risk Factors” in Alamos' Annual Information Form for the year ended December 31, 2014, which is available on the SEDAR website at www.sedar.com, should be reviewed in conjunction with the information found in this presentation. Although Alamos has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in forward-looking information, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate or that management’s expectations or estimates of future developments, circumstances or results will materialize. Accordingly, readers should not place undue reliance on forward-looking information.
Note to U.S. Investors
Alamos prepares its disclosure in accordance with the requirements of securities laws in effect in Canada, which differ from the requirements of U.S. securities laws. Terms relating to mineral resources in this presentation are defined in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects under the guidelines set out in the Canadian Institute of Mining, Metallurgy, and Petroleum Standards on Mineral Resources and Mineral Reserves. The United States Securities and Exchange Commission (the “SEC”) permits mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. Alamos may use certain terms, such as “measured mineral resources”, “indicated mineral resources”, “inferred mineral resources” and “probable mineral reserves” that the SEC does not recognize (these terms may be used in this presentation and are included in the public filings of Alamos, which have been filed with the SEC and the securities commissions or similar authorities in Canada).
Cautionary non-GAAP Measures and Additional GAAP Measures
Note that for purposes of this section, GAAP refers to IFRS. The Company believes that investors use certain non-GAAP and additional GAAP measures as indicators to assess gold mining companies. They are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared with GAAP.
Additional GAAP measures that are presented on the face of the Company’s consolidated statements of comprehensive income include “Mine operating costs”, “Earnings from mine operations” and “Earnings from operations”. These measures are intended to provide an indication of the Company’s mine and operating performance. “Cash flow from operating activities before changes in non-cash working capital” is a non-GAAP performance measure that could provide an indication of the Company’s ability to generate cash flows from operations, and is calculated by adding back the change in non-cash working capital to “Cash provided by (used in) operating activities” as presented on the Company’s consolidated statements of cash flows. “Free cash flow” is a non-GAAP performance measure that is calculated as cash flows from operations net of cash flows invested in mineral property, plant and equipment and exploration and evaluation assets as presented on the Company’s consolidated statements of cash flows and that would provide an indication of the Company’s ability to generate cash flows from its mineral projects. Return on Equity is defined as Earnings from Continuing Operations divided by the average Total Equity for the current and previous year. “Mining cost per tonne of ore” and “Cost per tonne of ore” are non-GAAP performance measures that could provide an indication of the mining and processing efficiency and effectiveness of the mine. These measures are calculated by dividing the relevant mining and processing costs and total costs by the tonnes of ore processed in the period. “Cost per tonne of ore” is usually affected by operating efficiencies and waste-to-ore ratios in the period. “Cash operating costs per ounce”, “total cash costs per ounce” and “all-in sustaining costs per ounce” as used in this analysis are non-GAAP terms typically used by gold mining companies to assess the level of gross margin available to the Company by subtracting these costs from the unit price realized during the period. These non-GAAP terms are also used to assess the ability of a mining company to generate cash flow from operations. There may be some variation in the method of computation of these metrics as determined by the Company compared with other mining companies. In this context, “cash operating costs per ounce” reflects the cash operating costs allocated from in-process and dore inventory associated with ounces of gold sold in the period. “Cash operating costs per ounce” may vary from one period to another due to operating efficiencies, waste-to-ore ratios, grade of ore processed and gold recovery rates in the period. “Total cash costs per ounce” includes “cash operating costs per ounce” plus applicable royalties. Cash operating costs per ounce and total cash costs per ounce are exclusive of exploration costs. “All-in sustaining costs per ounce” include total cash costs, exploration, corporate and administrative, share based compensation and sustaining capital costs. Non-GAAP and additional GAAP measures do not have a standardized meaning prescribed under IFRS and therefore may not be comparable to similar measures presented by other companies. For a reconciliation of non-GAAP and GAAP measures, please refer to Alamos’ Managements’ Discussion and Analysis as presented on SEDAR and the Company’s website.
All figures in US$ unless otherwise indicated.
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1 Please refer to Cautionary Notes on non‐GAAP Measures and Additional GAAP Measures.2 As of May 5, 2015.
Strong Platform for Delivering Long Term Value
STABLE PRODUCTION STRONG BALANCE SHEET LOW‐COST GROWTH
$350m in free cash flow1 generated to date
$350m cash & marketable securities2
Fully funded development pipeline
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1 Five year average ending 2014, including only gold producers over the full five year time frame.Source: Capital IQ. See our disclosure on Non‐GAAP measures on page 2 of this presentation. .
Long Term Track Record of Delivering Shareholder Value
10.9% 10.7% 10.7%
5.3%3.4%
0.1%
‐0.3% ‐0.6% ‐0.7% ‐1.0%‐3.4%
‐6.6%‐7.9%
‐18.6%‐20
‐15
‐10
‐5
0
5
10
15
SMF AGI CG NEM ELD G YRI BTO IMG NGD AEM ABX AUQ K
Return on Equity ‐ Five Year Average1
Acquired Surface Rights at Cerro Pelon & La Yaqui
5Please refer to Cautionary Notes on non‐GAAP Measures and Additional GAAP Measures.
2014 Achievements
Low‐cost production growth starting from La Yaqui in Q4 2016 & Cerro Pelon in 2017
Average production: ~33k oz/yr
Total cash costs: $490 oz
Modest initial capital: $21m
2015 exploration budget $5.3m
6Please refer to Cautionary Notes on non‐GAAP Measures and Additional GAAP Measures.
2014 Achievements
Transitioned to Underground Mining at San Carlos
2015 budget 9.5 g/t Au
Secured significant source of high grade mill feed
Initial mill production October 2014
2015 exploration budget $5.7m
Operating Data 2014A 2014E Guidance
Production oz Au 140,500 150,000 ‐ 170,000Cash Operating Costs1 US$/oz $639 $630‐670Total Cash Costs1 US$/oz $703 $700‐740All‐in Sustaining Costs1 US$/oz $1,022 $960‐1,000
Combined Gold Recovery % 65% 75%Combined Throughput tpd 17,200 17,700Average Grade – Heap Leach Ore g/t Au 0.98 0.85Average Grade – Mill Ore g/t Au 6.52 5.3Waste‐to‐Ore Ratio 0.63:1 0.84:1
71 Please refer to Cautionary Notes on non‐GAAP Measures and Additional GAAP Measures.
2014 Achievements
Achieved 2014 Cost Guidance
• Total cash costs $703/oz at low end of range of guidance• Leach pad continues to perform well – grades stacked 15% above budget• Deferred leach pad production recovered in Q1 2015• Mill commissioning issues expected to be resolved H1 2015
81 See year end 2014 mineral reserve and resource press release dated March 31, 2015, and press release dated June 28, 2012 on Turkey PFS and Çamyurt initial mineral resource estimate.
2014 Achievements
Ağı Dağı EIA Approved
Advanced Turkish development pipeline
Low‐cost production growth
Çamyurt 62% higher grade; significant upside to 2012 PFS1
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2015 Achievements
Record Health & Safety Performance at Mulatos
Two million man hours without a lost time accident surpassed April 2015
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2015 Achievements
Low Cost Production Growth Starting Q4 2016
• Total cash costs 7% below full year guidance• Heap leach grades stacked 15% above annual budget
• Mill improvements on track for stronger high grade production in H2 2015• Recoveries expected to increase to 75% and mill throughput >550 tpd in H2 • ~42kt of high grade stockpiles at end of April 2015
1 Please refer to Cautionary Notes on non‐GAAP Measures and Additional GAAP Measures.
Operating Data Q1 2015A 2015E Guidance
Production oz Au 38,000 150,000 ‐ 170,000Cash Operating Costs1 US$/oz $728 $800Total Cash Costs1 US$/oz $805 $865All‐in Sustaining Costs1 US$/oz $1,115 $1,100
Combined Gold Recovery % 72% 74%Combined Throughput tpd 17,500 17,850Average Grade – Heap Leach Ore g/t Au 0.92 0.80Average Grade – Mill Ore g/t Au 10.37 9.5Waste‐to‐Ore Ratio 0.61:1 1.27:1
Solid Q1 2015 Results
11Please refer to Cautionary Notes on non‐GAAP Measures and Additional GAAP Measures.
2015 Achievements
Significant Progress in Turkey
Forestry fees recently reduced
New Turkish mining law & royalty supportive of sustainable industry
Ağı Dağı EIA reinstated
Kirazlı EIA reinstated
Attractive tax incentives in place
Low‐cost, low capital intensity production growth
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2015 Achievements
Merger with AuRico Gold
Building a Stronger Platform for Growth
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Combined annual production potential > 700k oz Note: For Alamos, see year end 2014 mineral reserve and resource press release dated March 31, 2015. For AuRico, refer to www.auricogold.com/operations/reserves‐and‐resources..
Producing Assets in Top Mining JurisdictionsProducing Assets in Top Mining Jurisdictions
Strong Development PipelineStrong Development Pipeline
ExplorationExploration
• Young‐Davidson (Canada): Flagship long‐life underground gold mine• Mulatos (Mexico): Flagship open pit, heap leach operation• El Chanate (Mexico): Stable open pit, heap leach operation
• Kirazlı, Ağı Dağı & Çamyurt (Turkey): Advanced stage, low cost, open pit, heap leach development projects
• Esperanza (Mexico): Low cost, open pit, heap leach development project• Lynn Lake (Canada): Advanced high‐grade open pit gold project
• Quartz Mountain (USA): large inferred mineral resource• Orion (Mexico): 50% ownership with Minera Frisco S.A. de C.V.
Alamos + AuRico Merger: Solid Platform for Growth
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• High quality, diversified gold production from three North American mines• Two flagship, long‐life mines in Young‐Davidson and Mulatos
• Leading intermediate gold producer with a robust growth profile and diversified asset base• Enhanced capital markets attractiveness• Increased trading liquidity
• Strong combined balance sheet with increased financial flexibility• Superior cash flow growth profile• Significant synergies
• Significant unlocked value in Kemess project• Diversified royalty revenues• Strong management team
• Extensive portfolio of low cost development stage assets in safe jurisdictions that can be advanced in a disciplined manner
• Combination of two complementary and highly experienced teams• Significant open pit, heap leach and underground mining expertise
Diversifiedproduction
Leading growth profile
Significant re‐rating potential
Strong financial position
Complementary management teams
Exposure toSpinCo
Alamos + AuRico Merger: Benefits to All Shareholders
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Alamos + AuRico Merger: Best In Class Portfolio
MULATOS
2015E Au Production 150‐170k oz
2015E Au Cash Costs (1) US$800/oz
2P Au Reserves 1.7MM oz
Total Au Resources 4.8MM oz
EL CHANATE
2015E Au Production 65‐75k oz
2015E Au Cash Costs US$675‐775/oz
2P Au Reserves 0.6MM oz
Total Au Resources 0.7MM oz
QUARTZ MOUNTAIN
Stage AdvancedExploration
Total Au Resources 2.8MM oz
YOUNG‐DAVIDSON
2015E Au Production 160‐180k oz
2015E Au Cash Costs US$675‐775/oz
2P Au Reserves 3.8MM oz
Total Au Resources 5.6MM oz
AĞI DAĞI
Stage Permitting
Est. Annual Production 143k oz
Est. Cash Costs US$611/oz
Total Au Resources 1.9MM oz
Producing Assets
Exploration / Development Assets
TorontoHead Office
ESPERANZA
Stage Permitting
Est. Annual Production +100k oz
Est. Cash Costs ~US$500/oz
Total Au Resources 1.1MM oz
KIRAZLI
Stage Permitting
Est. Annual Production 99k oz
Est. Cash Costs US$515/oz
Total Au Resources 0.9MM oz
ÇAMYURT
Stage Resource Dev.
Total Au Resources 0.6MM oz
LYNN LAKE JV (25%)(2)
Stage Feasibility
Est. Annual Production 145k oz
Est. Cash Costs US$530/oz
Att. Au Resources 1.2MM oz
ORION JV (50%)
Stage Exploration
Att. Au Resources 0.1MM oz
Note: For Alamos, see year end 2014 mineral reserve and resource press release dated March 31, 2015. For AuRico, refer to www.auricogold.com/operations/reserves‐and‐resources.(1) Exclusive of royalties. (2) Option to earn an additional 35% interest in the project.
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Alamos + AuRico Merger: Larger, Diversified Portfolio in Safe Political Jurisdictions
Source: Company disclosure and analyst estimates.(1) Adjusted for 1.5% NSR royalty on Young‐Davidson transferred to SpinCo.
Canada50%
Mexico33%
Turkey17%
Pro Forma Asset Breakdown (1)Pro Forma Asset Breakdown (1)
Consensus NPV by GeographyConsensus NPV by Geography
Production77%
Development23%
Consensus NPV by StageConsensus NPV by Stage
• Mid‐tier gold producer with strong, low‐cost growth profile
• Robust balance sheet – fully funded development pipeline
• Long term track record of delivering shareholder value
• Catalysts
Q2 2014: Acquired surface rights at La Yaqui & Cerro Pelon
Q3 2014: Transitioned to underground mining at San Carlos
Q2 2015: Ağı Dağı EIA approval reinstated
Q2 2015: Kirazlı EIA approval reinstated
• June 24 2015: AuRico Gold merger shareholder vote
• Mid‐2015: Closing of merger with AuRico Gold
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Alamos – Investment Case
Scott K. Parsons, CFAVP, Investor Relations416.368.9932 x 439