CORPORATE PRESENTATION. December 2015

Transcription

1 CORPORATE PRESENTATION December

2 LA MANCHA IS A PRIVATE MINING COMPANY HOLDINGS IN LEADING AUSTRALIAN AND AFRICAN GOLD COMPANIES 30% holding The Sawiris family s 1 st investment in mining and vehicle for future growth Head office: Luxembourg Management: Paris 2015 attr. Prod 1 : koz 31% holding Ticker: TSX:EDV Market cap 2 : US$289m Mines & Projects: Production 4 : 580koz AISC 6 : US$ /oz Reserves: 4.8Moz M+I+I Resources 8 : 10.9Moz Ticker: ASX: EVN Market cap 3 : A$2.13B Mines: 7 Production 5 : koz AISC 7 : US$ /oz Reserves: 5.2Moz M+I+I Resources 8 : 12.7Moz 1 Based on estimates published by Evolution Mining and Endeavour Mining, after closing of the Endeavour deal in beginning of November As at December 11 th As at December 14 th Expected production as published by Endeavour in the Press Release published on September 21st 5 As published by Evolution for year ended June Based on pro-forma forecast for AISC converted into US$/oz with the exchange rate of 1.4AUD/USD 8 Resources inclusive of reserves, on an attributable basis 2

3 LA MANCHA S INVESTMENT APPROACH AMBITION TO CREATE A LEADING NATURAL RESOURCE COMPANY Our Approach of the Gold Industry Enter at an attractive valuation and consider special situation (distressed, consolidation, ) Quality assets (> 150 koz + low AISC < 900 $/oz + good visibility >8 years), capacity to operating world-wide Hands-on, opportunistic, and flexible management approach Capacity to have at least a relative control (ie min 30/40% without paying premium) or the full control Growth driven by improving quality of portfolio and size to re-rate Long Term shareholder Aggressive Exploration Invest in projects Asset potential unlocked Asset Turn-around De-risk Attractive Entry Point Junior Mining Company Strategy Implementation Optimize Production Create regional leader Long-term growth-focused investor 3

4 LA MANCHA S SUCCESS STORY DOUBLED THE GROUP S PRODUCTION IN 3 YEARS Asset Turn-Around: August Production shown on a 100% basis AUSTRALIA Purchased remaining 49% of Frog s Leg mine Built Mungari mill Commissioned White Foil Mine Mine life extended by 3y 67koz AISC of US$1,232/oz 105koz +140% in production -42% in AISC 147koz ~ 160koz AISC of US$720/oz 2012A 2013A 2014A 2015E IVORY COAST Obtained majority (55%) Optimized operation +50% in production -36% in AISC Ambitious exploration program leading to 4Moz resource ~ 80 Positive PFS for CIL project 40 AISC of US$1,101/oz AISC of US$700/oz 2012A 2013A 2014A 2015E SUDAN Maintained production level despite lower grades Exploration prolonged mine life by 2 years Stabilized ~ A 2013A 2014A 2015E 4

5 TRANSACTIONS UNDERTAKEN IN 2015 REPOSITIONS LA MANCHA AS A LEADING PRIVATE INVESTOR The transactions undertaken have allowed us to fasttrack our objective of reaching mid-tier status We are now well positioned to capture growth opportunities in both Australian and Africa X 1.7 Partnerships Transactions undertaken in 2015 Strategy decision: Dec. 14 Deal announced: April 15 SUDAN Opportunistic sale for US$100m Although Hassaï had significant growth potential, the cash received allowed us to immediately capture growth opportunities Removes geopolitical overhang and project development risk ~ koz AUSTRALIA Vend-in for 31% of Evolution Mining (EVN:ASX) X 2 Asset turn-around Africa (Endeavour att. share) Strategy decision: Feb. 15 Deal announced: April 15 Clear path to +800kozpa in Asutralia Diversifies risk across 7 mines Better positions us to capture growth Our assets benefit from mid-tier valuation ~250koz 117koz Côte d Ivoire Australia Sudan Côte d Ivoire Australia Sudan Australia (Evolution att. Share) Strategy decision: June 15 Deal announced: Sept 15 IVORY COAST Vend-in for 30% of Endeavour Mining (EDV:TSX) Clear path to +800kozpa in West-Africa Well positions us to capture re-rating potential of EDV Diversifies risk across 5 mines and 2 projects Greater leverage to upswing in the gold cycle Brings construction expertise to Ity mine E 2016E Production Attributable to La Mancha, in kozpa 5

6 Doray Medusa Silver Lake Troy La Mancha Saracen Beadell Perseus Kingsgate Cowal Resolute Regis St Barbara Evolution Oceana Gold Northern Star Evolution & La Mancha Evolution, Cowal & La Mancha Newcrest Avocet La Mancha - Ity Newcrest Perseus Teranga SEMAFO Golden Star Resolute IAMGOLD Endeavour Kinross Nord Gold Endeavour PF (2015) Gold Fields Endeavour PF (2018) AngloGold Ashanti Newmont Randgold CREATING LEADERS IN AUSTRALIA AND AFRICA Evolution Mining in Australia Endeavour Mining in Africa Australian Sector, 2014A production in kozpa African Sector, 2014A Production, in kozpa Cowal Purchase 810 2,944 Project Development: Ity CIL and Hounde Merger with La Mancha Australia / Evolution Merger: La Mancha CI / Endeavour

7 ALLIANCES WITH LA MANCHA ARE VERY WELL PERCEIVED BY THE MARKET Evolution Mining: Relative performance of +63% Relative performance since Strategic Alliance announcement Endeavour Mining: Relative performance of +15% Relative performance since Strategic Alliance announcement Market cap : A$2.1B +71% 115 Market cap : C$400m +12% Market cap : C$230 +8% 100 Market cap : A$560m 100-3% 50 Apr 15 May 15 Jun 15 Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Evolution ASX gold peers Spot gold (A$) 85 Sep-15 Oct-15 Oct-15 Oct-15 Nov-15 Nov-15 Dec-15 Endeavour Selected gold peers Gold price (US$/oz) Source IRESS of 11 December Australian peer index includes Newcrest, Northern Star, Independence, Regis and OceanaGold, St Barbara, Saracen, Resolute, Kingsgate, Silver Lake, Medusa and Focus Source: FactSet as of 11 December African gold peers include Randgold, Centamin, Acacia, B2Gold, Nord Gold, IAMGOLD, SEMAFO, Resolute, Golden Star, Teranga Gold, Perseus, Hummingbird, Aureus, Asanko and Amara. 7

8 LA MANCHA S STRATEGY GOING FORWARD AMBITION TO CREATE A LEADING NATURAL RESOURCE INVESTMENT VEHICLE La Mancha investment structure Our ambition is to create a leading Natural Resource investment vehicle focused in Africa and Australia With Endeavour Mining (TSX:EDV), our strategy is to improve portfolio structure (prod, CC and mine life) through: Internal Growth Ity (> 150 koz) + Houndé (> 200 koz) External Growth: strong pipe in West Africa Exploration: not activated on the past few years With Evolution Mining (ASX:EVN), our strategy is to pursue development through a team sized for growth with an excellent track-record Clear consolidator in Australia & Asia Contemplating gold project in Australia but also other metals (coppers, zinc, ) La Mancha is also contemplating possible acquisition in Base metals, Oil and Gas Geographic Area: Africa and Australia Gold Oil & Gas La Mancha Investment Vehicle Base Metals Gold Gold Base Metals, Oil and Gas Area Australia, Africa Africa Asset Stage Producing, development, exploration Main focus is to quickly become a producer Gold investments Asset quality Funding Exit strategy Supportive equity raises of EDV and EVN, and debt Long life, low cost production Fresh equity from shareholder and partnerships 30-40% long-term holder of leading regional player Investments in Base Metals, Oil and Gas 8

9 LA MANCHA MANAGEMENT TEAM Naguib Sawiris, Chairman Naguib Sawiris is a reknown Egyptian businessmen Executive Management Team Sebastien de MONTESSUS PRESIDENT AND CEO Head of Areva Mining Group prior to La Mancha Business graduate from ESCP in Paris Through the Orascom Group, the Sawiris family is present across various sectors and businesses, ranging from construction and fertilisers to real estate and telecommunications 1998: Naguib Sawiris created, with France Télécom, Mobinil, the n1 mobile operator in Egypt. Mr. Sawiris then created and developed Orascom Telecom which became in just a few years one of the largest telecom groups worldwide, with 83million subscribers by the end of 2012 Early 2011: Orascom Telecom merged with Vimplecom to create the 6 th largest mobile operator worldwide with 186million subscribers. Mr. Sawiris sold his stake in Vimplecom in mid Vincent BENOIT EXECUTIVE VICE-PRESIDENT, STRATEGY & BUSINESS DEVELOPMENT 20+ years of M&A and Investor Relation experience in the energy, telecoms, and IT services sectors Graduated from ESC Business School and is a Chartered Accountant Amr EL ADAWY CHIEF-FINANCIAL OFFICER 20 years of experience in Finance and Management in telecoms and retail sectors Holds a Finance Management and Accounting degree from CNAM Paris Patrick BOUISSET EXECUTIVE VICE-PRESIDENT, EXPLORATION & NEW VENTURES 30+ years of experience in exploration in O&G and mining Holds a master degree in Geology from Orleans University, and graduated from ESEM and ENSPM November 12 th 2012: Orascom World Investment, Mr. Sawiris s holding company, finalised the acquisition of La Mancha for CAD500 million ( 385 million) 9

10 LEADING PRIVATE GOLD INVESTOR PORTFOLIO OVERVIEW (Post-combinations) (Attributable share) Asset profile Location Australia West-Africa - Ownership 31% 30% - Mines 7 mines 5 mines + 2 projects 12 mines + 2 projects Reserves, Moz M+I+I Resources 1, Moz Production, koz ~ 430 AISC, US$/oz ~ ~ 800 Market Data 4,5 Market Cap, US$m US$1,546m (share price A$1.46) US$289m (share price C$0.69) US$566m Net debt, US$m US$349m US$161m Enterprise Value, US$m US$1,895m US$449m Strategic Alliance Commitment to fund growth, US$m $78m (A$112m) Equity placement US$75m In-principle, $35mln paid US$153m Shareholder profile Long-term strategic partner - Board seats 2 members 2 members 2 Equity lock-up 2 years 2 years 2 Vend-In 100% of Mungari operation 55% of Ity + US$63m of cash 6 All remaining assets Financials (H , precombinations) Revenue, US$m US$240m US$307m EBITDA, US$m Pro forma annual number ~USD 440mln US$98m N/A for period 1 Inclusive of reserves, on an attributable basis 2 As published by Evolution for year ended June 2016, AISC converted into US$/oz with the exchange rate of 1.4AUD/USD 3 Based on pro-forma forecast for EVN : As at December 14 th 2015 based on an exchange rate of 1.38AUD/USD 5 EDV : As at December 11 th 2015, based on an exchange rate of 1.37CAD/USD 6 The US$63 million cash investment by La Mancha is inclusive of an expected US$25 million of attributable cash held in SMI (representing 55% of an anticipated US$45 million cash balance at closing), with the balance being invested into the La Mancha subsidiary being sold to Endeavour. 7 EVN :As published by Evolution for H12015, converted into US$/oz with the exchange rate of 1.4AUD/USD 10

11 AUSTRALIA 31% holding of Evolution Mining 11

12 AUSTRALIA ASSET OPTIMIZATION AND TURN-AROUND Issues at the time of privatization (2012) No control of processing schedule as Frog s Leg was dependant on tollmilling Very expensive toll-processing costs at A$60/t Only a small production with 51% ownership of the Frog s Leg underground gold mine White Foil open-pit gold not in production as it needed a mill on-site Key developments Consolidated ownership of Frog s Leg through the acquisition of Alacer s 49% interest (for A$141m) Successfully re-started the White Foil open-pit gold mine Constructed the $110m 1.5mtpa Mungari CIL processing facility Alacer transaction and Mungari mill both funded out of cashflows and a A$183m debt facility (no equity required) Mine life extensions at Frog s Leg White Foil resource expanded from 0.5Moz to 1.9Moz with a positive scoping study for White Foil Underground Accomplishments as of today (2015) 100% ownership of all operations Mungari Mill built on time, on budget and running above nameplate capacity at 1.7mtpa (vs. 1.5mtpa) Milling costs for Frog s Leg reduced to $20/t (from $60/t) Rapid pay-down of debt facility from cashflows leaving balance of $124m at 30 June 2015 Opportunity to leverage ownership of mill to develop and / or consolidate regional deposits Exploration potential as limited exploration on the prospective tenement package to date Key metrics Production (attributable) 67koz x 2.2 Production Key metrics 150koz Reserves (attributable) 0.5Moz x 1.6 Reserves 0.8Moz Resources (attributable) 1.0Moz x 2.7 Resources 2.7Moz 12

13 OVERVIEW OF EVOLUTION Description of strategic alliance La Mancha has entered into a binding agreement to contribute 100% of La Mancha s Australian operation into Evolution in exchange for 31% of the enlarged entity. Transaction closed on August 24 th Both companies have a shared vision of creating a leading Australian player by capturing growth opportunities La Mancha is supportive of Evolution s growth plans, as proven by it s A$112m equity placement to help fund the Cowal acquisition of A$752m 1, which was successfully completed on July 24 th La Mancha has 2 seats on Evolution s board, and a 2-year equity lock-up La Mancha is highly supportive of Evolution s management style, led its CEO, Jake Klein Market Data Listing: ASX: EVN Share price as at December 14, 2015 in A$ in US$ ( ) Shares outstanding 1,461 m 1,461 m Market capitalisation A$ 2,133 m US$ 1,549 m ( ) Cash & cash equivalents A$ (48.2) m US$ (35) m (+) Debt (mrq) A$ 530 m US$ 385 m Enterprise value A$ 2614 m US$ 1895 m Assuming an exchange rate of 1.38 AUD/USD Formation of a leading Australian gold producer Main Shareholders (as of Oct 2015) Evolution La Mancha Australia Cowal Combined New Group Annual Production (koz) Reserves (Moz) Resources (Moz) Main shareholders La Mancha Holding 31.0% Van Eck 12.9% Ruffer LIp 2.9% Investec Asset Management Ltd 1.1% Vanguard Group Inc 1.0% 1 Including stamp duty and transaction costs) 13

14 DIVERSIFIED AUSTRALIAN PORTFOLIO Production Profile Cowal La Mancha Evolution 770koz koz 347koz 393koz 428koz 400koz 128 Townsville Pajingo Mt Carlton Mt Rawdon Cracow Brisbane 415 La Mancha Australia Edna May Cowal Sydney Annual production for year June to June, kozpa Cowal La Mancha Australia Pajingo Cracow Mt Rawdon Mt Carlton Edna May Total Ownership 100% 100% 100% 100% 100% 100% 100% 100% Gold Reserves (Moz) Gold Resources (Moz) FY2015A Au Production (Koz) * * FY2015A AISC (AU$/oz) ,020 1,180-1,260 1,080-1, ,225-1, ,060 FY2015A AISC 1 (US$/oz) FY2016E Au Production (Koz) * * As published by Evolution for year ended June 2016, AISC converted into US$/oz with the exchange rate of 1.4AUD/USD Source: Company information Note: Production is shown on 100% basis. Resources are shown inclusive of reserves and are shown on a 100% basis. Mine life based on current reserves 14

15 WEST AFRICA 30% holding of Endeavour Mining 15

16 LA MANCHA COTE D IVOIRE ASSET OPTIMIZATION AND TURN-AROUND Issues at the time of privatization (2012) 45.9% minority stake +20 years of existence but only 2 years of mine life based on reserves Operation not optimized and underperforming Strong exploration potential but: No resources identified No studies done to prove economic viability of potential Key developments Majority control obtained by increasing ownership to 55% Negotiation of a new technical agreement and mining convention New management put in place Record historic production achieved in of ~80koz Exploration has increased resources from 0.7Moz to 3.4Moz resources (+460%) Positive PFS study completed Accomplishments as of today (2015) Heap Leach production increased by 50% with costs reductions Increased production to +150/200 kozpa in 2018 with a +10 year mine life with CIL plant construction Resources up x6 in 3 years, targeting +2Moz in reserves and +4Moz in Resources by end of 2015 Huge exploration potential in a still underexplored area DFS expected to be completed by early 2016 Construction expected to start by 2016 with first gold pour in early 2018 Key metrics Key metrics Production 54koz x 1.5 Production 80koz Reserves 0.3Moz x 7 Reserves 1.7Moz (+2Moz target by year end) Resources 0.7Moz x 6 Resources 3.4Moz (+4Moz target by year end) 16

17 OVERVIEW OF ENDEAVOUR Shared vision of creating leading producer La Mancha has entered into a binding agreement to contribute La Mancha s 55% stake in the Ivorian Ity mine and US$63m 1 in cash in exchange for 30% of the enlarged entity. The transaction is expected to close in early November 1 $75m in-principle commitment by La Mancha to fund future growth La Mancha has 2 seats on Endeavour s board and a 2-year equity lock-up Sebastien de Montessus will become President of Endeavour upon closing and will be Neil Woodyer s, current EDV CEO, successor within 24 months of closing. Market Data Listing: TSX: EDV Share price as at December 11 th 2015 ( ) Shares outstanding anticipated at closing CAD USD m 590 m Market capitalisation C$ 391 m US$ 288 m (+) Net Debt C$220 m US$ 161 m Enterprise value C$ 611 m US$ 419 m Formation of a leading African gold producer Main Shareholders Endeavour La Mancha (Ity mine) Combined New Group Impact of adding Ity Main shareholders 5 La Mancha Holding 30.0% Production 2015E (koz) % AISC 2015E US$/oz % Reserves 3 (Moz) % Resources 4 (Moz) % Van Eck 5.3% Ruffer Ltd 4.5% Fidelity Management 1.4% Oppenheimer 1.1% 1 The US$63 million cash investment by La Mancha is inclusive of an expected US$25 million of attributable cash held in SMI (representing 55% of an anticipated US$45 million cash balance at closing), with the balance being invested into the La Mancha subsidiary being sold to Endeavour. 2 Based on pro-forma forecast for On an attributable basis 4 Inclusive of reserves, on an attributable basis 5 Anticipated at closing and based on holdings as of October

18 ENDEAVOUR MINING POST-MERGER : A WEST AFRICAN LEADER Production Profile Ounces 800,000 $/oz $1,100 West African footprint : 5 mines and 2 projects Mauritania 600, , , A Youga Nzema Agbaou Tabakoto Houndé Ity (Heap Leach) Ity (CIL) Group AISC $1,000 $900 $800 $700 $600 Senegal Gambia Guinea-Bissau Tabakoto Mine Guinea Mali Burkina Faso Houndé project Youga Mine Sierra Cote Ghana Leone d Ivoire Ity Mine Liberia Togo Agbaou Mine Nzema Mine Abidjan Accra Niger Benin Agbaou Nzema Tabakoto Youga Houndé Ity Ity CIL Total Ownership 85% 90% 80% 90% 90% 55% 55% - Gold Reserves (Moz) Gold Resources 1 (Moz) FY2015E Au Production 2 (Koz) FY2015E AISC (US$/oz) ,000-1, , , Source: Company information, Mine life based on current reserves 1 M+I+I Resources are shown inclusive of reserves and are shown on a 100% basis 2 Production is on a 100% basis 3 Based on pro-forma forecast for

19 SIGNIFICANT FOCUS IN CÔTE D IVOIRE MAJORITY OF PRODUCTION FOR COMBINED ENTITY Positive impact for La Mancha s Ity Gold Mine With the bulk of production based in Côte d Ivoire, Ity will benefit from strong shareholder support Ity mine to benefit from synergies with Agbaou mine Strong balance sheet to continue exploration and develop the CIL project Most Large gold footprint deposits in in a West highly Africa prospective are located and in the unexplored belt country Largest land holding and yet very low findings 35% % of Birimian Endownment found, Moz 110Moz 33Moz Endeavour s Construction Services team to contribute to the completion of feasibility study and construction plan 22% 19% 12Moz 8Moz 12Moz 11% 10% Endeavour s Agbaou mine Cote d Ivoire Burkina Faso Ghana Guinea Mali Endeavour s Agbaou mine is a low cost operation with significant exploration potential Endeavour acquired the project in 2010 La Mancha is leading explorer in Côte d Ivoire In US$m for Source : SNL reports Following exploration programs, completion of an updated FS, and on-time and under-budget project construction, the Agbaou mine started commercial production in Currently producing gold at a rate of +150koz/yr at an AISC/oz of $619 1 La Mancha Newcrest Amara Randgold Perseus Resolute Endeavour Taurus Gold Gryphon 1 Actual AISC/oz during Q2/

20 e koz OVERVIEW OF THE ITY MINE IN CÔTE D IVOIRE Asset overview 55% interest with remaining 40% held by Côte d Ivoire (State and SODEMI) and Didier Drogba group (5%) Ity has produced over 1Moz since 1991 Successful exploration has generated the CIL project, with a positive 2.0mtpa PFS published in 2014 DFS expected to be completed in early 2016 on the basis of increased resources and a 3.0mtpa plant Ity Mine site plan Asset overview Ity Gold Mine (100% basis) Heap Leach CIL Project 2 Stage In production DFS underway Production start date e Mine type Open Pit Open Pit Mill type 950ktpa HL 3.0mtpa CIL Upfront capital (US$M) n/a Approx. $300 Production 2015e: 88koz +120koz/yr AISC/oz (HL: H1 2015) US$696 <US$725 P+P Reserves 173koz 1.4Moz M&I Resources 1 2.9Moz Inferred Resources 0.5Moz Heap Leach - historical production (100% basis) Sawiris owned Mineral Resources inclusive of Reserves (100% basis) 2 Parameters currently being evaluated in the DFS 20

21 Project IRR OVERVIEW OF THE HOUNDE PROJECT IN BURKINA FASO Asset overview Located 250 km southwest of the capital city Ouagadougou 90% interest with remaining 10% held by the government of Burkina Faso DFS completed and Fully permitted Construction and financing decision to be taken in early 2016 Houndé gold operations Asset overview Houndé Gold Mine (100% basis) Stage Production start date Mine type Mill type CIL Project Received mining permit in Feb e Open Pit 3.0mtpa CIL Upfront capital (US$M) Approx. $325 Production AISC/oz (at US$1,250/oz) P+P Reserves M&I Resources 1 Inferred Resources 190koz/yr <US$ Moz 2.5Moz 0.3Moz Peer Project-Status, R&R and IRRs at $1,300/oz 70% 60% 50% Yaramoko (Roxgold) Karma (True Gold) 40% 30% 20% 10% 0% Bombore (Orezone) Yanfolila (Hummingbird) Yaoure (Amara) Esaase (Asanko) Ity CIL Houndé New Liberty (Aureus) Fekola 2 (B2Gold) Asanko Phase 1 (Asanko) Otjikoto 3 (B2Gold) 1 Mineral Resources inclusive of Reserves (100% basis) 2 Otjikoto IRR at $1,350/oz and pre-tax 3 Fekola IRR is pre-tax 21

22 THANKS About La Mancha Group La Mancha is a privately-held gold investment company held by the Sawiris Family. Under the Sawiris family ownership, La Mancha s assets were optimized, increasing annual production from 117,000 ounces in 2012 to 216,000 ounces in In 2015, the asset portfolio was restructured to position the company to capture growth opportunities in both Australia and Africa. In Australia, La Mancha now owns a 31% interest in Evolution Mining, a leading pure-australian gold miner. In Africa, after completion of the envisaged transaction, La Mancha will own a 30% interest in Endeavour Mining, a leading Africa-focused gold miner. For more information, please visit 22