wildcat silver corporate presentation
TRANSCRIPT
TSX:WS
Investor Presentation
January 2013
TSX:WS
Cautionary Statements
Cautionary Note Regarding Forward-Looking Information Certain information contained in this presentation constitutes forward-looking statements. All statements, other than statements of historical facts, are forward looking statements, including information concerning the Company's plans for its mineral property in Arizona. Forward-looking statements are often, but not always, identified by the use of words such as may, will, seek, anticipate, believe, plan, estimate, budget, schedule, forecast, project, expect, intend, or similar expressions. The forward-looking statements are based on a number of assumptions which, while considered reasonable by the Company, are subject to risks and uncertainties. In addition to the assumptions herein, these assumptions include the assumptions described in the Company's management's discussion and analysis for its year ended December 31, 2011 ("MD&A"). The Company cautions readers that forward-looking statements involve and are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to differ materially from those expressed in or implied by such forward-looking statements and forward-looking statements are not guarantees of future results, performance or achievement. These risks, uncertainties and factors include general business, economic, competitive, political, regulatory and social uncertainties; actual results of exploration activities and economic evaluations; fluctuations in currency exchange rates; changes in project parameters; changes in costs, including labour, infrastructure, operating and production costs; future prices of silver and other minerals; variations of mineral grade or recovery rates; operating or technical difficulties in connection with exploration, development or mining activities, including the failure of plant, equipment or processes to operate as anticipated; delays in completion of exploration, development or construction activities; changes in government legislation and regulation; the ability to maintain and renew existing licenses and permits or obtain required licenses and permits in a timely manner; the ability to obtain financing on acceptable terms in a timely manner; contests over title to properties; employee relations and shortages of skilled personnel and contractors; the speculative nature of, and the risks involved in, the exploration, development and mining business; and the factors discussed in the section entitled "Risks and Uncertainties" in the MD&A. Although the Company has attempted to identify important risks, uncertainties and other factors that could cause actual performance, achievements, actions, events, results or conditions to differ materially from those expressed in or implied by the forward-looking information, there may be other risks, uncertainties and other factors that cause performance, achievements, actions, events, results or conditions to differ from those anticipated, estimated or intended. Unless otherwise indicated, forward-looking statements contained herein are as of the date hereof and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable law. About Reserves and Resources This presentation uses the terms measured, indicated and inferred resources as a relative measure of the level of confidence in the resource estimate. Readers are cautioned that: (a) mineral resources are not economic mineral reserves; (b) the economic viability of resources that are not mineral reserves has not been demonstrated; and (c) it should not be assumed that further work on the stated resources will lead to mineral reserves that can be mined economically. In addition, inferred resources are considered too geologically speculative to have any economic considerations applied to them. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies or economic studies except for certain preliminary economic assessments. Readers should also refer to the Company's Annual Information Form for the year ended December 31, 2011 and other continuous disclosure documents available at www.sedar.com, which is subject to the qualifications and notes set forth therein. All Dollars are United States Dollars. All project metrics are shown on a 100%-ownership basis. All tonnes are metric tonnes.
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About Hermosa
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Hermosa Land Ownership
Stable, low risk jurisdiction
Located in Santa Cruz County, Arizona
80 km SE from Tucson, AZ
Near existing infrastructure
Power, water, highways, labour
Proposed Pit Outline M&I resource of 236M oz Ag
Inferred resource of 79M oz Ag
Patented claims (154 acres)
Unpatented claims (6,000 acres)
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Large and Growing Silver Resource Base
315M oz
2012 total resource base
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-25
25
75
125
175
225
275
325
2007 2010 2012
36.2M
84.9M
53.6M
Hermosa Silver Resource (Moz)
Measured & Indicated Resource
Inferred Resource
~6x
235.6M
79.0M
487% 2012 total resource base
from 2007
551% 2012 measured & indicated resource
from 2010
75% of total
*
* Does not include Sulfide zone of 4M oz Ag (3.8M tonnes of 30.84 g/t Ag)
*
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Total resource project comparison
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0
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Nav
idad
Pit
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Co
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Her
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Mav
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Can
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Juan
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Ber
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San
Agu
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Dia
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Pro
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Par
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Silv
erti
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Hermosa is one of the 10 largest undeveloped primary silver deposits*
Total global silver resource (Moz)
* Includes only projects with recent 43-101 compliant resource estimates
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Upper Silver Zone
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Recognized Upper Silver Zone in early 2012
Hosts a total resource of 155 million ounces at average grade of 27.5 g/t
Occurs as disseminations in the overlying volcanics
Previously considered as overburden
Silver/gold-only zone amenable to standard cyanidation and Merrill Crowe recovery
Silver recoveries of up to 52%
Metallurgical testwork continues to optimize silver recoveries
Zone remains open in all directions for expansion
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Hermosa Cross Section: A – A’
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A
A’
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Cross sections: B – B’
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B
B’
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Resource Block Model
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Section N167400 East-West view looking North
N
Grades are in opt
(In Feet)
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Resource Block Model
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Section E1075500 North-South view looking West
N
Grades are in opt
(In Feet)
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New Simplified Process Flow Sheet
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Crushing
Manto Oxide Stockpile
Ag/Au Doré
MANTO OXIDE ZONE
UPPER SILVER ZONE
Cyanide Leaching
Upper Silver Stockpile
Grinding
Cyanide Destruct
Simplified process using proven technology
Calcining
Merrill Crowe Silver Recovery Refinery
Leach Tails to Tailings Storage Facility or Potential Zn Flotation and/or Magnetic Separation
Solids Flow Stream
Solution Flow Stream
Legend
Cyanide Recovery
Copper Sulfide Precipitate
Average recoveries in PEA:
Silver (manto) – 82%
Gold (manto) – 90%
Silver (upper silver) – 40%
Gold (upper silver) – 90%
Metallurgical test work continues to optimize upper silver zone and manto oxide recoveries
Metallurgical test work continues for by-product
recoveries
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Initial Pilot Plant Tests Completed
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Pilot plant test work completed by Hazen • Completed in August 2012 • Processed approx. six tonnes of ore
(Manto and Upper Silver Zone)
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2012 Hermosa Project PEA
1.Net of by-product credits based on gold price of $1,525/oz Au, and copper price of $3.50/lb Cu
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2010 PEA 2012 PEA
6M oz
2.5x increase
Expected average annual silver production (first five years)
Production Metrics
Mining Rate 5.44 M tpa
Annual Ag Production (first 5 yrs) 15.5 M oz Ag
Average Ag Cash Costs1 (first 5 years) $8.29 per oz
Mine life 16 years
15M oz
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Production comparison – Developing Projects
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Escobal Navidad Hermosa Malku Khota Juanicipio Pitarilla Cordero Corani La Preciosa Rock Creek Saucito Fuwan Santa Ana San Luis
Source: Company Disclosure & Technical Reports for average LOM Production, Hermosa 2012 PEA
Estimated average annual silver production (Moz)
Guatemala Mexico Peru Peru Mexico Mexico Peru Mexico USA Bolivia Argentina Mexico USA China
First five years
average
LOM Average
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2012 Hermosa Project PEA Capital Costs
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Initial CAPEX1
Mining Equipment $29M
Mine Pre-development $31M
Process Plant & Tailings $269M
General Site & Ancillary Facilities $43M
Gas & Power Supply $43M
EPCM $51M
Owner’s Costs $38M
Other $27M
Sub-total $531M
Contingency $96M
TOTAL CAPEX $627M
Mining equipment
Mine pre-development
Process plant & tailings
General site & ancillary
facilities
Gas and power supply
EPCM
Owner's costs
Other
Contingency
1. Metrics on a 100%-basis
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2012 Hermosa Project PEA Economic Highlights
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Project Economics Base Case1 Spot Case 2
After-tax NPV (0%) $1.027B $1.586B
After-tax NPV (5%) $658M $1.048B
After-tax NPV (7.5%) $528M $860M
After-tax IRR 31.9% 43.4%
Project Payback 1.7 years 1.4 years
Silver Price ($/oz) $28.75 $34.60
Gold Price ($/oz) $1,525 $1,773
Copper Price ($/lb) $3.50 $3.73
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
-10% 0% +10%
After-tax NPV (5%) – Base Case
1. Base case is based on 60/40 pricing which is the weighted average of 60% of the three-year historical prices and 40% of two-year forward market prices.
2. Spot case is based on spot prices.
Change in Silver Price
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Site view – PEA pit outline
LOOKING SOUTHEAST
Tailings Storage Area
Road Access
Facilities and Plant Site
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PROPOSED OPEN PIT Strip Ratio 2.8:1
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WS SSO OK USA HL CDM THO MAG FVI EDR GPR AXR
Significantly Undervalued
Market Capitalization per ounce (C$ per ounce)(1)
1. Includes ounces across all categories (reserves, measured and indicated and inferred ounces) divided into market capitalization. Market cap valued as at December 5, 2012. Resource as reported by each Company in most recently completed reserve and resource statements
2. In US Dollars
Wildcat represents a significant value proposition
(2)
Average $5.39
$0.40/oz
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Producers
Non-Producers
Acquisition Value ~$1.62/oz
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Future Exploration Potential
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Completed airborne electromagnetic survey of the entire claim block
Surface sampling and geophysics has identified eleven new high potential targets on unpatented claims
Provides targets for continued exploration outside the currently defined resource.
Wildcat Silver Corp. Hermosa Project
High Potential Exploration Targets
High Potential Exploration
Targets
Approx. Pit Outline
N
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Scorecard & Milestones
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Completed expanded drill program
Conducted airborne EM survey , identified new drill targets on full claim block
Increased total resource significantly, upgraded inferred resource
Completed pilot plant
Completed PEA demonstrating expanded productive capacity
Optimize silver recoveries (upper silver zone and manto oxide zone) Underway
Optimize by-product recoveries for additional project value Underway
Complete pre-feasibility study Mid-2013
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APPENDIX
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November 12, 2012
Wildcat trades on TSX WS
Issued and outstanding 132.6M
Options 7.0M
Fully diluted 139.6M
Share price (recent) C$0.86
Market cap ~C$125M
Average volume (50 days) 200,000 shares
52 week high/low $2.34/$0.68
Mgmnt/insider ownership ~30%
Capital Structure
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Board of Directors
Experienced Board in creating shareholder value
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Richard W. Warke Chairman & CEO
Founder of the Augusta group of companies which include Augusta Resource Corporation (Executive Chairman), Wildcat Silver Corporation (Chairman and CEO), Riva Gold Corp (Chairman and CEO) and Plata Latina Minerals Corporation (Director). He was also the founder and Chairman of Ventana Gold Corp which was acquired for $1.5 billion. Richard has more than 25 years of experience in corporate finance and marketing in the global resource industry, and has been involved in raising over $1 billion dollars in equity for resource companies. Although his endeavours have primarily involved mineral resource operations, he has also been involved with oil and gas, forestry, technology and manufacturing operations.
Gil Clausen Vice Chairman
More than 25 years executive, finance, development and operations experience in the mining industry; currently President, CEO and Director of Augusta Resource Corporation, Director of Jaguar Mining Inc. and Chairman of Plata Latina Minerals Corporation. Gil is a P.Eng. and holds B.Sc. and M.Sc. degrees in Mining Engineering from Queen’s University and is a graduate of the Queen’s executive business program.
R. Stuart Angus Director
Independent business advisor, past partner and head of global mining group at Fasken Martineau. Chairman of Nevsun Resources Ltd., Director of SouthGobi and previously Director of Ventana Gold.
John R. Brodie Director
Formerly a partner at KPMG LLP, elected a fellow for distinguished service to the profession by the Institute of Chartered Accountants of British Columbia. Director of Western Coal and Silver Standard.
Donald B. Clark Director
35 years experience in the finance industry; sits on the Board for two other natural resource companies including Augusta Resource Corporation and previously Ventana Gold.
Robert P. Wares Director
Professional geologist with more than 25 years experience in mineral exploration and research; Executive VP, COO and Founding Director of Osisko.
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Management
Experienced management with solid track record of success
Richard W. Warke Chairman & CEO
Founder of the Augusta group of companies which include Augusta Resource Corporation (Executive Chairman), Wildcat Silver Corporation (Chairman and CEO), Riva Gold Corp (Chairman and CEO) and Plata Latina Minerals Corporation (Director). He was also the founder and Chairman of Ventana Gold Corp which was acquired for $1.5 billion. Richard has more than 25 years of experience in corporate finance and marketing in the global resource industry, and has been involved in raising over $1 billion dollars in equity for resource companies.
Donald R. Taylor President & COO
30 years of successful mineral exploration experience on more than five continents in base and precious metals, taking projects from exploration to mine development; was previously at Doe Run Resources and BHP Minerals; has Bachelor of Science degree in Geology from Southeast Missouri State University and a MSc from University of Missouri at Rolla; Licensed Professional Geologist in several states and QP as defined by NI 43-101.
Paul J. Ireland Chief Financial Officer
Extensive financial experience in mining and forestry; Chartered Accountant; was previously also CFO of Ventana Gold Corp.
William J. Pennstrom, Jr. Vice President, Technical Services
35+ years experience in the management and engineering aspects of mineral processing; holds a Bachelor of Science degree in Metallurgical Engineering and a Masters of Arts degree in Business Management; QP in Process Metallurgy as defined under NI 43-101
Charles J. Magolske Vice President, Corporate Development
25 years experience in marketing, operations management, business management, joint ventures and acquisitions in both domestic and international venues; degrees in Law, Business and Engineering (Professional Engineer); also VP of Corporate Development for Augusta Resource Corporation.
Gregory F. Lucero Vice President, Sustainable Development
More than 20 years of management experience in both the public and private sector, as well as an extensive background in the executive government working for local, state, and federal elected officials; holds a Bachelor of Arts degree in Political Science from the University of Arizona.
Letitia Cornacchia Vice President, Investor Relations & Corporate Comm.
More than ten years experience in finance and investor relations; holds Bachelor of Commerce degree in Finance from the University of British Columbia and is a CFA charterholder; also VP of Investor Relations and Corporate Communications for Augusta Resource Corporation, Riva Gold Corporation and previously Ventana Gold Corp.
Purni Parikh Vice President, Corporate Secretary
More than 22 years experience in business administration including more than 17 years experience with public companies in the areas of communications, investor relations and legal administration; also Corporate Secretary for Augusta Resource Corporation and previously Ventana Gold Corp.
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2012 Resource Estimate
NI 43-101 Resource Estimate* dated August 2012
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Zone Type Tonnes (000)
Ag (g/t)
Au (g/t)
Mn (%)
Zn (%)
Cu (%)
Contained Silver Ounces (000s)
Measured Mineral Resource*
Manto Oxide 36,744 66.64 0.09 7.12 1.81 0.07 78,725 Upper Silver Mixed 57,038 29.64 0.07 0.85 0.12 0.02 54,360
Total Measured 93,782 44.14 0.07 3.31 0.78 0.04 133,085
Indicated Mineral Resource*
Manto Oxide 39,713 41.52 0.06 5.69 1.66 0.06 53,008 Upper Silver Mixed 60,685 25.36 0.06 0.95 0.16 0.02 49,481
Total Indicated 100,398 31.75 0.06 2.83 0.75 0.04 102,489
Measured and Indicated Mineral Resource*
Manto Oxide 76,457 53.59 0.07 6.38 1.73 0.06 131,733 Upper Silver Mixed 117,722 27.44 0.06 0.90 0.14 0.02 103,841
Total Measured & Indicated 194,180 37.73 0.07 3.06 0.77 0.04 235,574
Inferred Mineral Resource*
Zone Type Tonnes (000)
Ag (g/t)
Au (g/t)
Mn (%)
Zn (%)
Cu (%)
Contained Silver Ounces (000s)
Manto Oxide 21,747 39.56 0.06 7.03 2.79 0.10 27,662 Upper Silver Mixed 57,764 27.65 0.06 0.85 0.17 0.02 51,346
Total Inferred 79,510 30.91 0.06 2.54 0.89 0.04 79,008
• The mineral resource is constrained within a Whittle optimized pit shell based on the following metal prices and recoveries: (Metal/Price/Recovery): Silver/$25.76 per oz/90%; Manganese/$0.60 per lb/95%; Zinc/$0.93 per lb/80%; Copper/$3.21 per lb/90%). The mineral resource is based on processing costs of US$27.55/tonne for the Manto Zone. The Upper Silver Zone mineral resource is tabulated using a silver cut-off grade of 8.57 g/t. Previous mineral resources did not include a resource for gold as no metallurgical test work had been completed to prove its recovery or economic viability. As a result of recent test work the expected recovery included in the above table has been used and gold has been included in the total mineral resource.
This resource does not include the sulfide mineral resource of 4M oz Ag (3.8M tonnes of 30.84 g/t Ag)
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Head Office 400-837 West Hastings St Vancouver, BC V6C 3N6
tel (604) 484-3597
Investor Relations Letitia Cornacchia
tel (416) 860-6310 [email protected]