05 14 2014 baml presentation v final to post

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  • Bank of America Merrill Lynch 2014 Global Metals, Mining and Steel Conference | May 14, 2014 Gary Goldberg | President and CEO
  • Cautionary Statement May 14, 2014 Newmont Mining Corporation Slide 2 Cautionary statement regarding forward looking statements, including outlook: This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbor created by such sections and other applicable laws. Such forward-looking statements may include, without limitation: (i) estimates of future production and sales; (ii) estimates of future costs applicable to sales and All-in sustaining costs; (iii) estimates of future consolidated and attributable capital expenditures; (iv) plans and expectations relating to future saving or reductions in costs and expenditures and related improvements or optimizations; (v) expectations regarding decisions regarding future exploration or development projects and the development, growth and exploration potential of the projects; (vi) expectations regarding future dividend payments; (vii) expectations regarding future debt repayment, project funding, cash retention, attributable free cash flow and financial flexibility; and (viii) expectations regarding the closing of proposed transactions, portfolio optimization and asset sales, including, without limitation, the sale of Jundee. Forward-looking statements often include words such as "anticipates," "estimates," "expects," "projects," "intends," "plans," "believes" and words and terms of similar substance in connection with discussions of future operating or financial performance. Estimates or expectations of future events or results are based upon certain assumptions, which may prove to be incorrect. Such assumptions, include, but are not limited to: (i) there being no significant change to current geotechnical, metallurgical, hydrological and other physical conditions; (ii) permitting, development, operations and expansion of the Companys projects being consistent with current expectations and mine plans, including, without limitation, receipt of acceptable export permits and approvals; (iii) political developments in any jurisdiction in which the Company operates being consistent with its current expectations; (iv) certain exchange rate assumptions for the Australian dollar to the U.S. dollar, as well as other the exchange rates being approximately consistent with current levels; (v) certain price assumptions for gold, copper and oil; (vi) prices for key supplies being approximately consistent with current levels; and (vii) the accuracy of our current mineral reserve and mineral resource estimates. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, such statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by the forward-looking statements. Such risks include, but are not limited to, gold and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, political and operational risks, community relations, conflict resolution and outcome of projects or oppositions and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Companys 2013 Annual Report on Form 10-K, filed on February 21, 2014, with the Securities and Exchange Commission, as well as the Companys other SEC filings. The Company does not undertake any obligation to release publicly revisions to any forward-looking statement, including, without limitation, outlook, to reflect events or circumstances after the date of this presentation, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. Investors should not assume that any lack of update to a previously issued forward-looking statement constitutes a reaffirmation of that statement. Continued reliance on forward-looking statements is at investors' own risk.
  • Overview
  • Maintaining safe and efficient operations Carlin welding shop, Nevada 0.46 0.49 0.49 0.40 0.50 0.47 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 May 14, 2014 Newmont Mining Corporation Slide 4 Newmont total injury rate* by quarter * Total Recordable Accident Frequency Rate per 200,000 hours worked
  • Why Newmont? Strong asset portfolio Stable production base Sharp focus on core competencies Continuous cost improvement Clear capital allocation priorities Prospective development options Head frame for Turf Vent Shaft, Nevada May 14, 2014 Newmont Mining Corporation Slide 5
  • Delivering on our commitments Improving the business On track to save $600 $700M by 20161 Improved guidance in Africa Strengthening the portfolio Optimized organic growth pipeline Turf Vent Shaft on budget and schedule Maintaining financial flexibility Lowered capex while preserving options Reduced interest expense guidance Akyem gold pour, Ghana May 14, 2014 Newmont Mining Corporation Slide 6
  • 1,165 1,210 Q1 2013 Q1 2014 Trajectory of lower costs Attributable gold production (Koz) Gold production up 4% 1,121 1,034 Q1 2013 Q1 2014 Gold all-in sustaining costs (AISC)2 ($/oz) May 14, 2014 Newmont Mining Corporation Slide 7 All-in sustaining costs down 8%
  • Q1 2013 Q1 2014 Sustaining capital Development capital Consolidated capital expenditures ($M) Capital spending down 54% Sustaining capital down 27% versus Q1 2013 2014 development capital primarily for Turf Vent Shaft Akyem delivered on time and on budget Phoenix Copper Leach delivered on time and on budget 235 510 May 14, 2014 Newmont Mining Corporation Slide 8
  • Step change in performance at Tanami Tanami underground, Australia May 14, 2014 Newmont Mining Corporation Slide 9 Tanami Q1 2014 versus Q1 2013 43% reduction in AISC 40% increase in gold production 20% increase in ore tonnes mined 32% improvement in grade through optimized mine plans
  • Optimizing operations and plans in Africa Subika underground project, Ghana Africa Q1 2014 outlook improvements 13% reduction in AISC Improved cost and production outlook at Ahafo Akyem delivers 120 Koz at AISC of $361/oz in Q1 2014 Optimizing expansion plans May 14, 2014 Newmont Mining Corporation Slide 10
  • Positioned to maximize value May 14, 2014 Newmont Mining Corporation Slide 11 Repay debt Develop projects Pay dividend4 Retain cash Increase debt repayment Fund additional projects Increase dividend Repay debt Retain cash Review options at lower prices $1,300 $1,400$1,200 ~$1B cumulative free cash flow generated for each $100 increase in gold price ~$1.5B attributable free cash flow3 2014 2016
  • MaintainDe-risk (e.g., Conga) Improve value (e.g., Tanami, Ahafo) Close or divest (e.g., Midas) Earning the right to grow All assets and opportunities must: Create value (NPV, ROCE) Improve mine life Lower position on cost curve Represent acceptable risk Risk Value Portfolio Approach High Low HighLow May 14, 2014 Newmont Mining Corporation Slide 12
  • Merian Project Capital costs $0.90B $1.0B (100%) Production 400 500 Koz per year* Gold AISC: $800 $950/oz* Gold Reserves of 4.2 Moz** Government has 25% earn-in rights Emerging district in Suriname * Average for first five years of production ** Merian Reserves presented at 100% as of December 31, 2013 Merian exploration camp, Suriname May 14, 2014 Newmont Mining Corporation Slide 13
  • Investment pipeline with optionality Long Canyon (Nevada) Investment decision in 2015 Estimating ~150Koz/year (Phase 1)* Ahafo Mill Expansion (Ghana) Investment decision in 2015 Estimating ~200 Koz/year* Subika Underground (Ghana) Investment decision in late 2015 or early 2016 Estimating ~200 Koz/year* Exploration drilling at Long Canyon Slide 14Newmont Mining CorporationMay 14, 2014 * Average for first five years of production
  • Maqui Maqui Subika Underground Federation (Tanami) Exodus Long CanyonBull Moose Exploration focused on near-mine options 15 May 14, 2014 Newmont Mining Corporation Slide 15
  • Boddington, Australia Vision for the future Positioned to capture benefits of economic recovery, demand growth Portfolio of longer-life, lower-cost assets Steady production profile Ongoing cost and capital discipline Investment grade balance sheet and financial flexibility Stronger growth pipeline Compelling shareholder value Twin Creeks, Nevada May 14, 2014 Newmont Mining Corporation Slide 16
  • Questions
  • Appendix