JSE  Mining Indaba  Educational  Seminar ‐.   By  Peter MajorThe 2014 African Mining Indaba.  Cape Town  RSA 

3  February  2014

CADIZ CORPORATE SOLUTIONS

Peter Major:Fund Manager & AnalystCadiz Corporate Solutions 

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Shareholders ‐ In The Mining & Resources Sector

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How on earth did I end up here?

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Resources Have Had A Bad 6 Years.

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INDI  Has ‘Stolen The Show’ These Past 5 Years.

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The Bad:     Sa Mining Industry.    Who’s In Charge?  

Management?   Workers?   Unions?   Government?                      And Shareholders?

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Policy Certainty?   What’s That?But there are some certainties in South Africa .  Unfortunately ‐many are bad!

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Management,  Unions,  Government,  Labour, Suppliers  Vs   Shareholders

And Now We Have  AMCU  VS  NUM.

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EXCELLENCETAKES A LIFETIME OF PREPARATION

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SA’S Mining Index Has Beaten The S&p 500 Over The Past 52 Years

This Index has returned an average 13.3%pa in US$ since 1960

Source: INet 9

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:  SA INFLATION    A Rand IN 1982 IS WORTH 7c TODAY.

How governments ruin economies.   Through ‘bad’ management, printing money & more!

SOURCE: INET 10

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In The 1940’s – 60’s & 1990’s South Africa’s Gold Mines Kept  Costs < CPI

Since 2003 +16% pa cost increases in Gold ‘and’ Platinum mines have been the norm.

SOURCE: INET 11

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Platinum  n  Rand/OzNice constant revenue  pa increase.

SOURCE: INET 12

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Never Has The RESI Fallen To Far So Fast  Realtive To The INDI

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Earnings Drive And Hold Up Share Prices

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Never Before Have The Resi’s $ Earnings Fallen So Hard – So Fast

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ALSI 40 = $690 bn                 RESI 10 = $170 bn  

:   South Africa’s Main Indices ‐ THE ALSI 40 & THE RESI 10

Always a great Rand Hedge.                                                                                  25 Jan 2014

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South African Mineral Production ‐ 2013 E

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CADIZ Corporate Solutions 6 February 2014

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International & South Africa’s Mining Industries

There are no ‘bad’ jobs in mining.        1973  Major begins mining and earns $21 a day.

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In The 1990’s It Was All About  ‘Stock Picking’ To Perform.

Source: INET 20

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Africa’s Dot Com ‘Millionaire Into Billionaire’:  Mark Shuttleworth

$530 m in the SA Mining & All Share Indices in 2001 increased to >$1.5 billion by 2005

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But In The 2000’s It Was  ‘Macro’  Ie  Sector & Asset Allocation

Buying  the Indices  instead of  ‘stock picking’.

Source: INET 22

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.    CADIZ CORPORATE SOLUTIONS6 000 abandoned mines in South Africa

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Mechanization  Isn’t  ‘Always’  The Answer To  Increasing ProductivityNorth Idaho, 2012.   Modernizing ‘Processes’ Is As Important As Machines.

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African Commodity Instruments Available To Invest In

1. Equities:  70 mining & resources African companies listed on JSE  

(+200 African Resource companies on other exchanges)

2. Futures: On African Mining Indices, Shares, Commodities

3. Exchange Traded Funds: Metals and Indices. Local and Overseas (Resi, GSCI, FCRB)

4. Derivatives: Warrants, Options, Single Stock Futures, ETF’s, Other

5. Gold, Platinum, Copper:   ETF,  Kruger Rands, Bullion, Coins

6. Unit trusts: +10 local Mining & Resources funds (many more on 

other  exchanges)

7. Private funds: Numerous,  All types (local and overseas)

8. Mines! Operating. Control the Mine

9. Abandoned mines:  6 000 in South Africa alone! All commodities

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150 Years of mining in  South Africa. Beginning in 1852 – Okiep Copper Company First PGM production in SA began in 1927.

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Western Deep Levels in 2012. 4 km deep.  Shaft sinking 1957.  Producing since 1962.

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People consume more each year – ‘and’ multiply! 

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Most PGM production still comes from highly labor intensive, underground mines.

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Words Are Words   Promises Are Promises   Explanations Are Explanations

But only PERFORMANCE is Reality!    1981  (8 years later)  ‐ earning $200 a day.

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This document is confidential and is issued for the information of the addressee and of clients of Cadiz Holdings Limited Reg. No.1997/007258/06 and its subsidiaries ("Cadiz") only. It is subject to copyright and may not be reproduced in whole or in partwithout the written permission of Cadiz. The information, opinions and recommendations contained herein are and must beconstrued solely as statements of opinion and not statements of fact. No warranty, expressed or implied, as to the accuracy,timeliness, completeness, merchantability or fitness for any particular purpose of any such recommendation or information isgiven or made by Cadiz in any form or manner whatsoever. Each recommendation or opinion must be weighed solely as onefactor in any investment or other decision made by or on behalf of any user of the information contained herein and such usermust accordingly make its own study and evaluation of each strategy/security that it may consider purchasing, holding or sellingand should appoint its own investment or financial or other advisors to assist the user in reaching any decision. Cadiz will acceptno responsibility of whatsoever nature in respect of any statement, opinion, recommendation or information contained in thisdocument. This document is based on historical information, and provides no guarantee of future performance.

DISCLAIMER

Contact Information

JOHANNESBURG OFFICE

Physical Address:

31 West StreetLower HoughtonJohannesburg2198South Africa

T +27 11 853 8000

CAPE TOWN OFFICE

Physical Address:

Ground Floor, Fernwood HouseThe Oval1 Oakdale RoadNewlands, 7700South Africa

Robbie GonsalvesHead: Corporate SolutionsT +27 21 657 8476M +27 82 452 7275F +27 21 657 8308E robbie.gonsalves@cadiz.co.za

CADIZ CORPORATE SOLUTIONS

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Introduction:   Peter Major – Cadiz – Cape Town,  South Africa:  SPEAKER

• Mining  Consultant and Analyst ‐ Cadiz Corporate Solutions      2006 – 2012• CIO,  Fund Manager,  Analyst  ‐ HBD Asset Management            2001 – 2005

• Senior Fund Manager and Analyst – Nedcor Investment Bank    1991 – 2001• Gold Analyst – Allan Gray Investment Counsel                               1989 – 1991

• Consultant , Marketing Manager ‐ EIMCO Mining Machinery     1985 – 1988

• Came to South Africa – Harmony  Gold Mine, MBA (UCT)         1982 – 1984

• BSc Mining Engineering   ‐Montana School of Mines                    1977 – 1981• Began mining in Kellogg  Idaho, Montana, Alaska, Canada           1972 – 1981

• Born in Vancouver, BC.  Moved to Kellogg , Idaho in 1961           1955 ‐ 1972

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