Antofagasta plc Bank of America 2020 Global Metals, Mining and Steel Conference Iván Arriagada Chief Executive Officer 12 - 14 May 2020
Cautionary statement This presentation has been prepared by Antofagasta plc. By reviewing and/or attending this presentation you agree to the following conditions: This presentation contains forward-looking statements. All statements other than historical facts are forward-looking statements. Examples of forward- looking statements include those regarding the Group's strategy, plans, objectives or future operating or financial performance; reserve and resource estimates; commodity demand and trends in commodity prices; growth opportunities; and any assumptions underlying or relating to any of the foregoing. Words such as “intend”, “aim”, “project”, “anticipate”, “estimate”, “plan”, “believe”, “expect”, “may”, “should”, “will”, “continue” and similar expressions identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that are beyond the Group’s control. Given these risks, uncertainties and assumptions, actual results could differ materially from any future results expressed or implied by these forward-looking statements, which apply only as of the date of this presentation. Important factors that could cause actual results to differ from those in the forward-looking statements include: global economic conditions; demand, supply and prices for copper; long-term commodity price assumptions, as they materially affect the timing and feasibility of future projects and developments; trends in the copper mining industry and conditions of the international copper markets; the effect of currency exchange rates on commodity prices and operating costs; the availability and costs associated with mining inputs and labour; operating or technical difficulties in connection with mining or development activities; employee relations; litigation; and actions and activities of governmental authorities, including changes in laws, regulations or taxation. Except as required by applicable law, rule or regulation, the Group does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Certain statistical and other information about Antofagasta plc included in this presentation is sourced from publicly available third party sources. Such information presents the views of those third parties and may not necessarily correspond to the views held by Antofagasta plc. This presentation is for information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy shares in Antofagasta plc or any other securities in any jurisdiction. Further it does not constitute a recommendation by Antofagasta plc or any other person to buy or sell shares in Antofagasta plc or any other securities. Past performance cannot be relied on as a guide to future performance. 2
Strategic Framework Developing Mining for a Better Future People Safety and Sustainability Competitiveness Developing mining for a better future Growth Innovation 3
COVID-19 Update Maintaining a safe and healthy environment Health of our people and local communities Sustaining operational continuity ▪ All sites have kept operating Implemented health measures and strict ▪ Operations workforce at site reduced by one-third. 25-30% of protocols, including: workforce teleworking successfully ▪ Social distancing and pandemic PPE ▪ Sales and shipments unaffected ▪ Preventative controls over symptoms ▪ Lower mine movement and maintenance, gradually being ▪ Dedicated air and road transport for shift changes recovered ▪ High health risk people working from home ▪ With no shutdown we expect limited impact on copper production in 2020 Launched a $6 million community fund to: ▪ Lower end of original guidance 725-755,000 tonnes of copper ▪ Buy medical equipment and supplies ▪ Los Pelambres Expansion project on precautionary care and ▪ Sterilise public spaces and providing basic supplies to people maintenance for a maximum of 120 days in lockdown ▪ Provide financial support to SMEs and local suppliers 4
Sustainability is central to everything we have and will achieve Economic Social Transparency and People Environment Performance Development Corporate Governance Zero fatalities Long term approach Shared development, not Environmental Risk appetite defined mitigating impacts management model Safety and health model High quality and long- Risk management life assets Relationship models: Use of renewable energy Labour relations Ethics committee ‘Somos Choapa’ and Value over volume Sea water use Diversity and inclusion Group values ‘ Diálogos para el Disciplined capital GHG emissions target Desarrollo’ Flexitime schemes allocation Shareholder returns 5
Improving operating discipline 2019 record safety and production performance Copper production (kt) Safety performance Lower end of 725-755 770 725 range 709 704 2.00 630 1.61 1.57 1.53 1.01 0.60 2 Q1 Q1 1 0 1 0 0 194kt 189kt 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Lost Time Injury Frequency Rate (LTIFR) 1 Fatalities 1 Number of accidents with lost time during the year per million hours worked 6
2020 guidance Net cash cost ($/lb) Guidance 1,3 1.29 1.25 1.22 1.20 Copper production (kt) Guidance 1,2 Lower end of 725-755 770 725 range 704 130 Antucoya & 120 140 2017 2018 2019 2020E 132 Zaldívar 277 Capital Expenditure ($bn) 248 245 Centinela 228 Guidance 4 Less than $1.3 1.1 0.9 0.9 363 358 355 Los Pelambres 334 2017 2018 2019 2020E 2017 2018 2019 2020E 1 Includes each operation at mid-point of guidance range and Zaldívar on a 50% basis 2 Revised 22 April. Copper production is expected to be at the lower end of the original 725-755,000 tonnes guidance, assuming no shutdowns are required 3 Revised 22 April down by 10c/lb, assuming revised production guidance is achieved and the Chilean peso averages 800 pesos to the US dollar for the year 4 Revised 22 April from original guidance of $1.5 billion 7
Strong balance sheet Cash / (debt) and Net debt/EBITDA ratio Long term structured debt $ million and times ▪ Strong balance sheet maintained over many years Cash 0.18x 0.27x 0.23x 4,000 ▪ Debt includes $388m of subordinated shareholder 2,511 loans as at March 2020. When excluded, company´s 2,252 2,193 1,898 financial position is net cash 2,000 ▪ Los Pelambres Expansion project 100% financed by $1.3 billion unsecured corporate loan 0 (197) (456) (563) (596) Cost and Competitiveness Programme (1,919) (2,167) (2,159) (2,319) (2,000) (575) (542) (598) (388) ▪ Expanding beyond the original target for this year of (2,494) (2,707) (2,709) (2,757) $100 million through increased savings and efficiency (4,000) Debt ▪ 2017 2018 2019 Q1 2020 Reviewing our cash flow and our expenditure to further preserve our financial strength Cash Debt Sub Debt Net Debt Net debt/EBITDA 8
Sustainability performance Economic growth not possible without social value creation and environmental care CO 2 emissions intensity (tCO 2 e/tCu) 2 Committed to climate change mitigation 3.87 3.67 ▪ 100% of Mining Division’s power from renewable sources from 3.33 3.10 2022 following new contracts at Los Pelambres, Centinela and Antucoya, reducing Group energy costs by 10% to 20% ▪ Target of 3% reduction of forecast GHG by 2022 (300,000 t CO 2 ) Water and tailings 1 2016 2017 2018 2019 ▪ 46% of water consumed comes from the sea ▪ 85% of water at Los Pelambres is recirculated Water consumption (Mm 3 ) ▪ Currently building a desalination plant at Los Pelambres ▪ Thickened tailings at Centinela 67.2 65.8 60.8 55.4 36.9 36.5 From mitigating impacts to shared development 32.6 28.9 ▪ “ Somos Choapa ” and “ Dialogos para el Desarrollo” programmes 30.4 29.2 ▪ Antofagasta Region public-private Mining Cluster 28.2 26.5 ▪ Prioritising local suppliers and employment 2016 2017 2018 2019 ▪ Regional development Continental water Sea water 1 For more information about Antofagasta’s approach to tailings management please see page 19 of this presentation 2 Tonnes of CO 2 equivalent per tonne of copper produced (Scope 1 and 2 emissions) 9
Drought in Central Chile Context ▪ 2019, driest year of a 10-year drought in Choapa Valley ▪ Low rain and snow fall so low recharge of aquifers ▪ Surface and underground water availability affected Water use at Los Pelambres ▪ 85% of water used is recirculated ▪ 15% is from the mine, surface and underground ▪ Water use has been reduced further by: ⁻ Tight pipeline leakage maintenance ⁻ Covering water storage ponds ⁻ Less use of the dust suppression system Engagement with authorities and communities ▪ Working with authorities and communities to find ways to alleviate impact of water shortage in the short, medium and long term ▪ Prioritising water for human consumption ▪ Pumping water into the Choapa river from underground ▪ Minimising water losses by thorough maintenance of canals and waterways ▪ Providing food, and moving livestock to less water stressed areas 10
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