African Barrick Gold Company Presentation September 2014 Important - PowerPoint PPT Presentation

African Barrick Gold Company Presentation September 2014

Important Notice This presentation includes “forward-looking statements” that express or imply expectations of future events or results. Forward-looking statements are statements that are not historical facts. These statements include, without limitation, financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future production, operations, costs, projects, and statements regarding future performance. Forward-looking statements are generally identified by the words “plans,” “expects,” “anticipates,” “believes,” “intends,” “estimates” and other similar expressions. All forward-looking statements involve a number of risks, uncertainties and other factors, many of which are beyond the control of ABG, which could cause actual results and developments to differ materially from those expressed in, or implied by, the forward-looking statements contained in this presentation. Factors that could cause or contribute to differences between the actual results, performance and achievements of ABG include, but are not limited to, changes or developments in political, economic or business conditions or national or local legislation or regulation in countries in which ABG conducts - or may in the future conduct - business, industry trends, competition, fluctuations in the spot and forward price of gold or certain other commodity prices (such as copper and diesel), currency fluctuations (including the US dollar, South African rand, Kenyan shilling and Tanzanian shilling exchange rates), ABG’s ability to successfully integrate acquisitions, ABG’s ability to recover its reserves or develop new reserves, including its ability to convert its resources into reserves and its mineral potential into resources or reserves, and to process its mineral reserves successfully and in a timely manner, ABG’s ability to complete land acquisitions required to support its mining activities, operational or technical difficulties which may occur in the context of mining activities, delays and technical challenges associated with the completion of projects, risk of trespass, theft and vandalism, changes in ABG’s business strategy including, ABG’s further implementation of operational reviews, as well as risks and hazards associated with the business of mineral exploration, development, mining and production and risks and factors affecting the gold mining industry in general. Although ABG’s management believes that the expectations reflected in such forward-looking statements are reasonable, ABG cannot give assurances that such statements will prove to be correct. Accordingly, investors should not place reliance on forward-looking statements contained in this presentation. Any forward- looking statements in this presentation only reflect information available at the time of preparation. Subject to the requirements of the Disclosure and Transparency Rules and the Listing Rules or applicable law, ABG explicitly disclaims any obligation or undertaking publicly to update or revise any forward-looking statements in this presentation, whether as a result of new information, future events or otherwise. Nothing in this presentation should be construed as a profit forecast or estimate and no statement made should be interpreted to mean that ABG’s profits or earnings per share for any future period will necessarily match or exceed the historical published profits or earnings per share of ABG. Mineral reserves and mineral resources estimates contained in this presentation have been calculated as at 31 December 2013 in accordance with National Instrument 43-101 as required by Canadian securities regulatory authorities, unless otherwise stated. Canadian Institute of Mining, Metallurgy and Petroleum (CIM) definitions were followed for mineral reserves and resources. The figures stated are estimates and no assurances whatsoever can be given that the indicated quantities of metal will be produced. In addition, totals stated may not add up due to rounding. For more information regarding the nature of reserves and resources estimates and relevant CIM definitions, please see page 90 of ABG’s 2013 Annual Report and Accounts. You are reminded that you have received this presentation subject to the disclaimer and important notices contained herein and on the basis that you are a person to whom this presentation may be lawfully made and delivered in accordance with the laws of the jurisdiction in which you are located. You may not and are not authorised to: (i) reproduce or publish this presentation; or (ii) distribute, disclose or pass on this presentation to any other person, in whole or in part, by any medium or in any form, whether electronically or otherwise. ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF THIS PRESENTATION IN WHOLE OR IN PART IS UNAUTHORISED. FAILURE TO COMPLY WITH THIS NOTICE MAY RESULT IN A VIOLATION OF APPLICABLE SECURITIES LAWS. BY ACCEPTING THIS PRESENTATION, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. 1

Contents 1. Background 2 2. Operational Overview 7 3. Financial Review 13 4. Investment Proposition 18 5. Appendix 20 2

Where We Operate Ticker: ABG Listing: London Stock Exchange (FTSE 250) Dar es Salaam Stock Exchange Market Cap: $1.6 billion Major Shareholders: Barrick, M&G, Franklin Templeton, L&G, Blackrock, Wellington 3

Overview  Strong production base in Tanzania with a high quality, high grade reserve base ‒ Guiding for production in excess of 700koz in 2014  Continuing improvement in cost base with seven successive quarters of reductions in AISC ‒ Reduced AISC from $1,709/oz in Q3 2012 to $1,105/oz in Q2 2014  Free cash flow positive in Q2 2014 - cash position of $270 million as at 30 June 2014 – First quarter of positive cash flow since 2012  Delivering quarter on quarter operational improvements across the portfolio High quality asset base – delivery on operational turnaround key to cash flow generation 4

Continued Consistent Reduction in Costs Evolution of Cash Cost and All I n Sustaining Cost (US$/ ounce sold) 2,000 Cash cost / ounce AISC / ounce 1,709 1,600 1,675 1,577 1,404 (US$/oz) 1,200 1,270 1,100 1,175 1,162 1,131 1,105 to 1,012 1,175 958 893 800 862 740 790 774 756 749 to 728 790 400 0 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 FY14e 5

Continuing to Deliver on Stated Targets and Expansions Milestone Achieved  Quarter on quarter reduction in AISC  Grade improvement at Bulyanhulu  CIL Expansion moved into commissioning phase  Board approval of Upper East Project  Reduction in outstanding indirect tax receivables  First production from CIL Expansion  Group net cash generation Consistent step up in Bulyanhulu development rates Q3 2014 First ore from Bulyanhulu Upper East Q3 2014 Board approval of Gokona Underground Q4 2014 Achievement of US$185 million of cost savings Q4 2014 First ore from Gokona Underground Q1 2015 6

Contents 1. H1 2014 Highlights 2 2. Operational Overview 7 3. Financial Review 13 4. Investment Proposition 18 5. Appendix 20 7

Asset Overview - Bulyanhulu 2014 Key I nitiatives Progress   Accelerate development and improve access Grade increased by 9% over H1 13, developing to higher grade stopes Deep West to increase this further   Reduce amount of equipment in operation in Parked up 3 jumbos and now delivering order to improve productivity increased development metres   Commission CIL Expansion through Q2, First gold produced in Q2 adding 40kozpa at AISC of less than $800/oz 8

Asset Overview - North Mara 2014 Key I nitiatives Progress   Complete study into mining Gokona Cut 3 via an Study on track for Q4 Board approval, underground operation development of exploration portal underway   Reduce number of high cost international International employees reduced by 36% year employees on year   Improve maintenance practices to reduce costs Condition based monitoring and a smaller fleet and improve availabilities reduced maintenance costs by 10% YoY 9

Asset Overview - Buzwagi 2014 Key I nitiatives Progress   Optimise crusher and mill performance to Mill performance behind plan due to mill re- exceed nameplate capacity lines and gearbox issues, both resolved in Q2   Reduce levels of inventory and improve US$6m reduction in operating supplies during planning processes H1   Improve power mix of the mine to continue to Optimisation of power mix ongoing, expect reduce reliance on diesel generated power improvements in H2 post gearbox resolution 10

Outlook Cash Costs (US$ per ounce sold) Production (koz) 750 1,000 Cash Costs per Ounce Sold (US$/oz) 700+ 941 900 700 Ounces (000’s) 800 650 827 740-790 642 775 626 700 600 600 550 500 500 2012 2013 2014E 2012 2013 2014E All I n Sustaining Cost (US$ per ounce sold) Capital Expenditures (US$ Million) 400 1,750 AIS C per Ounce Sold (US$/oz) Expansion, Expansion, 117 1,500 1,585 50 US/$ million 300 Expansion, Cap Dev't, 1,362 1,250 50 120 Cap Dev't, 1,100-1,175 200 172 Cap Dev’t 1,000 125-135 Sustaining, 100 750 186 Sustaining, Sustaining, 112 80-90 500 - 2012 2013 2014E 2012 2013 2014E 11

CSR Initiatives - Screening of the World Cup 12

Contents 1. H1 2014 Highlights 2 2. Operational Overview 7 3. Financial Review 13 4. Investment Proposition 18 5. Appendix 20 13