kgi - q2 production upate for f2015

A PROFITABLE FUTURE

Toronto Marketing November 12-13, 2014

A RICH HISTORY

Forward Looking Statements Cautionary Note Regarding Forward Looking Statements.

This presentation contains statements which constitute ”forward-looking statements”, including statements

regarding the plans, intentions, beliefs and current expectations of the Company with respect to the future

business activities and operating performance of the Company. The words “may”, “would”, “could”,

“should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions, as

they relate to the Company, are intended to identify such forward-looking statements. Forward-looking

statements used in this Presentation include, but may not be limited to, statements regarding the Company’s

production forecast including ounces produced and grade assumptions; the operating costs and all-in cash

cost for fiscal 2015; and exploration programs and their results. Investors are cautioned that forward-looking

statements are based on the opinions, assumptions and estimates of management considered reasonable at

the date the statements are made such as, without limitation, opinion, assumptions and estimates of

management regarding the Company’s business, its ability to increase its production capacity and decrease

its production cost. Such opinions, assumptions and estimates, are inherently subject to a variety of risks

and uncertainties and other known and unknown factors that could cause actual events or results to differ

materially from those projected in the forward-looking statements. These factors are discussed in length in

the Company's annual Management's Discussion and Analysis and Annual Information Form for the year

ended April 30, 2014. and the Company’s Management's Discussion and Analysis for the interim period

ended July 31, 2014 filed with the securities regulatory authorities in certain provinces of Canada and

available at www.sedar.com.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking

statements prove incorrect, actual results may vary materially from those described herein as intended, planned,

anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties

and factors which could cause actual results to differ materially, there may be others that cause results not to be as

anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update these

forward-looking statements except as otherwise required by applicable law.

TSX/AIM:KGI www.klgold.com 2

Company Vision

George Ogilvie, P.Eng., CEO

“Build a sustainable mining company that is

recognized as a safe and responsible intermediate

gold producer.

“We will provide exceptional stakeholder value by

delivering operational and exploration excellence

through empowering our people to act as owners.”

www.klgold.com 3 TSX/AIM:KGI

Diverse Board of Directors

New Appointments

Barry Cooper, B.Sc., MBA (Non-executive Director)

• Former head analyst with CIBC

Jeff Parr, CA, BA, MBA (Non-executive Director)

• CFO of Centerra Gold

Barry Olson, M.Sc. (Non-executive Director)

• Former Sr. VP Projects of Goldcorp

Harry Dobson, Chairman of the Board (Non-executive Director)

Dawn Whittaker, LLB (Non-executive Director)

Pamela Klessig, P.Geo (Non-executive Director)

John Thomson, CA

George Ogilvie, P.Eng


Synergistic Management Team GEORGE OGILVIE, P. Eng.

President & CEO, Director

• 25 years management, operating, and

technical expertise in the mining industry

with over 9 years of operating experience

in deep, narrow-vein gold mines (Anglo

Gold, South Africa)

• Former CEO of Rambler Metals and

Mining

JOHN THOMSON, CA

Executive VP and CFO,

Director

• More than 25 years experience in

various senior level finance positions

with companies such as PepsiCo

• Chartered Accountant who studied at

INSEAD

CHRIS STEWART, P. Eng.

VP Operations

• More than 20 years of operating

experience in Northern Ontario in various

senior-level positions. Prior to joining

KGI, was CEO of Liberty Mines Inc.

• Mining Engineering degree from Queen’s

University

Worked together

at Dynatec for

~3.5 years

Worked together at

Rambler for ~ 7 years


Investment Highlights

Located in Ontario, one of the safest and lowest risk mining jurisdictions globally

Attractive NI43-101 high grade reserve and resource profile with a long mine life

Growing annual production, declining cost base and improving unit costs

Company returning to profitability and free cash flow

Significant exploration potential with organic growth

Potential upside with a higher gold price and a weaker Canadian dollar


Financial Position

CASH C$41.4 million*

DEBT C$120 million convertible debentures

KGI.DB: 6% coupon/ $15.00 strike

C$54.5MM mature Jun/2017

KGI.DB.A: 7.5% coupon/ $13.70 strike

C$65.5MM mature Dec/2017

ROYALTY 2.5% NSR Franco Nevada Corporation

option to buyback 1% by October 31, 2016

CAPITAL STRUCTURE*

ISSUED SHARES 72,081,617

FULLY DILUTED 84,986,448

MARKET CAP ~270 Million

52 Week Performance*

HIGH C$6.19

LOW C$2.21


* Share Capital as of July 31, 2014. All other info as of October 31, 2014.

KGI Share Performance Vs Gold


(-40%)

(-20%)

30%

40%

50%

60%

70%

80%

90%

100%

110%

120%

Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14

Kirkland Lake (TSX:KGI) Gold Price (C$ / oz)

Kirkland Lake Background

KGI owns five former producing high grade

mines with historical production of ~22 Moz’s

of gold at an average head grade of 0.44 opt

(15.1 grams per tonne).

The Kirkland Lake gold camp

has been producing gold for

over 100 years.

Almost 25 Moz’s has been

produced to date, from seven

mines.

Based on grade, it is one of the

richest gold camps in the world.


Second Highest Grade Gold Mine In The World

Mine Operator Location Gold Grade Reserves

g/t 000 oz Au

Turquoise Ridge Barrick USA 17.40 6,761

Macassa Kirkland Lake Gold Canada 17.10 1,385

Pogo Gold Sumitomo Corp. USA 15.20 2,932

Gosowong Newcrest Indonesia 12.00 1,235

Moab Khotsong AngloGold Ashanti South Africa 10.00 6,126

Mponeng AngloGold Ashanti South Africa 9.98 14,569

Red Lake Gold GoldCorp Canada 9.94 2,553

TauTona AngloGold Ashanti South Africa 9.06 1,389

Kupol/Dvoinoye Kinross Russia 8.73 2,081

17.4 17.1 15.2 12.0

10.0 10.0 9.9 9.1 8.7

0.0

5.0

10.0

15.0

20.0

Gra

de g

/t

Reserve Grades


New Mine Plan With Positive Results

Old Plan Focussed on QUANTITY and TONNEAGE New Plan Focusses on QUALITY and GRADE

SIGNIFICANT

INCREASE IN

GRADE

REDUCTION

IN COSTS

CASH

FLOW

POSITIVE

• Not Dependant on a High Gold Price

• Requires Less Manpower

• Fewer Stopes

• Strict Ore/Waste Management and Dilution Control

Additional benefits of new mine plan are SIMPLIFIED PLANNING

and ability to FINANCE AT COMPANY’s DISCRETION


Reserves & Resources (Resources are Exclusive of Reserves)

RESERVES AND RESOURCES MINE WIDE COMPLEX

CATEGORY (31st DEC 2013)

TONS GRADE

(opt)

GRADE

(gpt) OUNCES

Proven 941,000 0.43 14.7 401,000

Probable 1,843,000 0.53 18.2 984,000

Total P+P 2,784,000 0.50 17.1 1,385,000

Measured 1,133,000 0.39 13.4 436,000

Indicated 3,019,000 0.54 18.5 1,619,000

Total M+I 4,152,000 0.49 16.8 2,055,000

Inferred 2,092,000 0.54 18.5 1,133,000

See Kirkland Lake news release dated April 28 2014, a copy of which has been filed on SEDAR for further particulars and full NI 43-101 disclosure including QP statement.

Based on current level of Reserves and 70% conversion of Resources (@ 200,000 oz p.a)

Macassa has a 14 year Mine Life

RESERVES AND RESOURCES SOUTH MINE COMPLEX (“SMC”)

CATEGORY (31st DEC 2013)

TONS GRADE

(opt)

GRADE

(gpt) OUNCES

Proven 328,000 0.45 15.4 147,000

Probable 1,163,000 0.57 19.5 665,000

Total P+P 1,492,000 0.54 18.5 812,000

Measured 24,000 0.30 10.3 7,000

Indicated 1,440,000 0.70 24.0 1,005,000

Total M+I 1,464,000 0.69 23.7 1,012,000

Inferred 1,205,000 0.67 23.0 808,000


South Mine Complex

• 5400L has reserve grade @ 0.57 opt (19.5 gpt)

• 5600L has reserve grade @ 0.70 opt (23.9 gpt)

• Production from 5400L and 5600L allows delineation drilling of resources, especially below 5600L

• Remains Open at Depth and Across Strike

5025 Level

P+P 89,000 Tons @ 0.44 oz/ton 39,000O Oz’s

M+I 57,000 Tons @ 0.30 oz/ton 22,000 Oz’s

5300 Level

P+P 620,000 Tons @ 0.47 oz/ton 290,000 Oz’s

M+I 220,000 Tons @ 0.30 oz/ton 86,000 Oz’s

5400 Level

P+P 481,000 Tons @ 0.57 oz/ton 274,000 Oz’s

M+I 170,000 Tons @ 0.41 oz/ton 71,000 Oz’s

5600 Level

P+P 290,000 Tons @ 0.70 oz/ton 209,000 Oz’s

M+I 220,000 Tons @ 0.55 oz/ton 122,000 Oz’s

5700 to 6600 Level

M+I 768,000 Tons @ 0.91 oz/ton

703,000 Oz’s

Original Two

Mining Horizons

Third Level

Started

May 2014

Currently in Development

for FY 2016

OPEN OPEN

OPEN

#3 S

HA

FT

#2 S

HA

FT


5025L

5300L

5400L

6600L

5600L

4750L

Q2/H1 of F2015 Production Update

Q1 F2015

38,543

93,880

0.45

Q2 F2015

38,335

92,146

0.41

H1 F2015

76,878

186,026

0.43

Ounces Sold

Tons Milled

Head Grade (opt)

• Second stope (5612) brought into production on 5400 level

• 2 Electric Hydraulic Jumbo’s fully operational

• Main ramp towards the 5600 level progressing well and is on schedule


0.34 0.31 0.30

0.26 0.29

0.45

0.39

0.34 0.37

0.34

0.47

0.51

0.39

0.43 0.41

-

0.10

0.20

0.30

0.40

0.50

0

5,000

10,000

15,000

20,000

Aug Sep Oct Nov Dec Jan Feb Mar Apr May2014

Jun Jul Aug Sep Oct

Ou

nc

es

per

To

n

Go

ld O

un

ce

s

Oz Recovered Head Grade

Monthly Production Profile Average Grade 0.41 opt

• Cut-off Grades Raised from 0.18 opt to 0.22 opt.

• Stopped Mining “Incremental Tonnage”

• Implemented Strict Ore/ Waste Segregation UG

• Increasing UG Delineation Drilling in SMC

• Employing more UG Geologists

• Assay Lab is Manned 24/7

• Restructuring Organization

• Implementing Leadership Training

• Looking to Upgrade MIS


0.37

0.40

0.37

0.32

0.41

0.37 0.31 0.33

0.37 0.39

0.41

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

-

50,000

100,000

150,000

200,000

250,000

FY2007

08 09 10 11 12 13 14 15 16 17

Ou

nc

es

per

To

n

Go

ld O

un

ce

s

Oz Recovered Guidance Head Grade

Annual Production Profile

Expectation Gap

• Guided Grades for F2015-F2017 are Based on Historic Achievements

• Calendar YTD Actual Head Grade is 0.41 opt; Fiscal YTD Actual Head Grade is 0.43 opt


F2014 & Q1 F2015 Financial Results

Financial FY2014 FY2013 Y/Y

Change Q1/14 Q4/14 Q1/15

Q1/15

vs.

Q1/14

Q1/15

vs.

Q4/14

Comments

Gold Sales

(ounces) 125,273 91,771 +37% 30,253 30,771 38,543 +27% +25%

Sold 10,903 ounces at C$1,419

up to September 30th

Average

Price ($)

(per ounce) 1,383 1,653 -16% 1,435 1,376 1,401 -2% +2%

Revenue

(000’s) 173,258 151,692 +14% 43,421 42,356 54,000 +24% +27%

H2/15 tons are expected to increase by

+10% to ~1,100 – 1,250 tpd, which will

positively impact the Cost Per Ton

Cash

Operating

Cost per

Ton

Produced

343 335 +2% 344 352 340 -1% -3% Objective is for Cost Per Ton of ≤ $300

in H2/2015

Cash

Operating

Cost per

Ounce

Produced

1,078 1,109 -3% 1,113 1,000 788 -29% -21% F2015 Objective is for Cash Cost Per

Ounce of ≤ $800

AICC per

Ounce

Produced 1,986 2,432 -18% 2,094 1,774 1,250 -40% -30% F2015 Objective is for AICC < $1,250

All amounts stated are in Canadian dollars


All-In Cash Cost (AICC) $

1,1

27

$1,3

07

$956

$1,1

56

$1,1

12

$1,0

52

$1,4

03

$1,1

87

$839

$1,0

73

$1,1

19

$836

$1,2

44

$720

$614

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000

MAY2013

JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY2014

JUN JUL

Ou

nces

C$ p

er

Ou

nce

Production Capital Development PP&E Corporate Exploration Royalties Oz Produced

Ounces Produced


• 16% Reduction in Labour Force and Cancelled Incentive Programs (e.g. home loan assistance and travel)

• Major Capital Projects (PP&E) Completed in January 2014

• Adjusted Shift Schedules


AICC Projection for F2015

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

$-

$500

$1,000

$1,500

$2,000

$2,500

FEB MAR APR MAY2014

JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR

Ou

nces

C$ p

er

ou

nce

Production Capital Development PP&E Corporate Exploration Royalties Oz Produced

Ounces Produced

$1,350

ESTIMATED


• Projection Based on Assumptions of 1,150 tpd, 0.37 opt and 96% Mill Recovery

• KGI Beginning to Generate FCF

• Fairly High Degree of Variability Remains until more High Grade Stopes come online


Expansion Capital

• Hoisting system capable of hoisting 3,600 tpd

• Mary-Anne Compartment installed in Shaft providing service cage

• Mill upgraded to handle 2,200 tpd

• Underground infrastructure and battery equipment in place for SMC


Capital Expenditures

• Project Capital was Completed in January 2014

• C$9M in Capital Development of 5400L and SMC Main Decline to

5600L Spent in FY15

0

10

20

30

40

50

60

70

80

90

100

2010 2011 2012 2013 2014 2015E 2016E 2017E

C$ M

illi

on

s

Mineral Properties PP&EESTIMATED

9.7

22.4 30.9 45.8 46.9 55.0 51.0 51.0 51.0

28.9

24.5 44.0

29.6 7.0 7.0 7.0


Exploration Potential SURFACE DRILLING • Near surface mineralization is within 2 Km’s of mill

• Mill has excess capacity of +/- 1,000 tpd

• Mineralization from 100’ to 1,000’ below surface

• Open across strike and at depth

• M&I 310,000 tons @0.34opt (11.7gpt) 104,000 oz.

• Infer. 131,000 tons @0.36opt (12.3gpt) 48,000 oz.

• 3 drills drilling to expand resource and infill drill

UG DRILLING • SMC continues to be expanded

• Multi-ounce intersections

• 3 drills turning underground

• Open in multiple directions


Outlook for F2015

Guidance Metric Q1/15 Actual Status

$800 – 850/ Oz Cash Operating Cost Per Ounce $788 Favourable

$1,250 - 1,350/ Oz AICC Per Ounce Produced $1,250 On Track

$58.0 million Sustaining CAPEX $12.0 million On Track

$200.0 million Revenue $54.0 million On Track

$50.0 - 60.0 million Cash Flow from Operations $17.0 million Favourable

$15.0 - 20.0 million Free Cash Flow Generation $5.0 million On Track



WWW.KLGOLD.COM

Suzette N Ramcharan, CPIR

Director of Investor Relations

+1-416-840-7884

Mobile: +1-647-284-5315

[email protected]

Tim Blythe / Halimah Hussain

(Blytheweigh)

Investor Relations / PR

+44-207-138-3204

[email protected]/

[email protected]

TSX /AIM: KGI

mailto:[email protected]



kgi - q2 production upate for f2015

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