Nordgold: Low Cost Producer with Excellent Growth Pipeline Nikolai - PowerPoint PPT Presentation

Nordgold: Low Cost Producer with Excellent Growth Pipeline Nikolai Zelenski, CEO / NORD LI (LSE) March 2016

Disclaimer Information contained in this presentation concerns industry in which the Group operates may differ officers or any other person accepts any liability Nord Gold N.V., a company organized and existing materially from those described in or suggested by whatsoever for any loss howsoever arising from under the laws of Netherlands (the “Company”, and the forward-looking statements contained in these any use of the contents of this presentation or together with its subsidiaries, the “Group”), and is materials. In addition, even if the Group’s results of otherwise arising in connection therewith. for general information purposes only. The opinions operations, financial condition, liquidity, prospects, presented herein are based on general information growth, strategies and the development of the The presentation and the information contained gathered at the time of writing and are subject to industry in which the Group operates are consistent herein does not constitute or form a part of any change without notice. The Company relies on with the forward-looking statements contained in offer or solicitation to purchase or subscribe for information obtained from sources believed to be these materials, those results or developments securities in the United States. The securities of the reliable but does not guarantee its accuracy or may not be indicative of results or developments in Company have not been, and will not be, completeness. future periods. The Company does not intend to registered under the US Securities Act of 1933, as amended (the “Securities Act”) . Accordingly, the update these statements to reflect events and These materials may contain forward-looking circumstances occurring after the date hereof or to securities of the Company may not be offered or statements regarding future events or the future reflect the occurrence of unanticipated events. sold in the United States except pursuant to an financial performance of the Group. One can Many factors could cause the actual results to differ exemption from, or in a transaction not subject to, identify forward looking statements by terms such materially from those contained in forward-looking the registration requirements of the Securities Act. as “expect”, “believe”, “estimate”, “anticipate”, statements of the Company, including, among The Company does not intend to conduct a public “intend”, “will”, “could”, “may”, or “might”, the others, general economic conditions, the offering of any securities in the United States negative of such terms or other similar competitive environment, risks associated with expressions. These forward-looking statements operating in the states where the Group operates, include matters that are not historical facts and changes in the world [gold] market, as well as statements regarding the Group’s intentions, many other risks specifically related to the Group beliefs or current expectations concerning, among and its operations. No reliance may be placed for other things, the Company’s results of operations, any purposes whatsoever on the information financial condition, liquidity, prospects, growth, contained in this presentation or on its strategies, and the industry in which the Group completeness, accuracy or fairness. operates. By their nature, forward-looking The information in this presentation is subject to statements involve risks and uncertainties, verification, completion and change. Accordingly, because they relate to events and depend on no representation or warranty, express or implied, circumstances that may or may not occur in the is made or given by or on behalf of the Company or future. The Company cautions you that forward- any of its shareholders, directors, officers or looking statements are not guarantees of future employees or any other person as to the accuracy, performance and that the Groups’ actual results of completeness or fairness of the information or operations, financial condition, liquidity, prospects, opinions contained in these materials. None of the growth, strategies and the development of the Company nor any of its shareholders, directors, 2

Nordgold: Diversified Asset Base Across Four Continents Neryungri Buryatzoloto 84 koz 113 koz Gross 230E+ koz Pistol Bay Bouly Bissa Berezitovy Montagne d’Or 120E+ koz 235 koz 125 koz Suzdal Aprelkovo 75 koz 20 koz Taparko 83 koz 2015 Revenue by Geography Operating Mines Lefa 214 koz Developing Assets Burkina Faso Russia Exploration Assets 33% Kazakhstan 37% Exploration Areas Guinea 8% 23% Actual production in 2015 3

Nordgold – a Premium Gold Mining Company Low Cost Producer High Quality Pipeline   All-in sustaining costs Two compelling projects for 2015 at US$793/oz in construction phase   Strong Free Cash Flow Several prospective projects in generation FS and PEA/exploration phase Premium Gold Mining Company Proven Track Record of Delivering  Track record of surpassing production and cost guidance  Bissa mine was constructed ahead of time and budget 4

Nordgold is a LOW COST Producer Compared to Peers • H1 2015 Nordgold’s AISC was US$722/oz (down 20% YoY) - one of the lowest compared to peers • FY2015 Nordgold AISC was US$793/oz (down 10% YoY) • US$158.1m Free Cash Flow achieved in 2015 while investing in construction of Bouly mine H1 2015 All-In Sustaining Cost, US$/oz Au Eq. 1 400 1 200 1 000 722 800 Nordgold 600 400 200 Gold production, koz 0 0 5 000 10 000 15 000 5

Strong Cash Flow in Challenging Market Environment • Nordgold Operating Cash Flow (OCF) increased despite the falling gold price as a result of higher output and lower costs • Meaningful positive Free Cash Flow (FCF) generation due to strong OCF and low maintenance capex $ million 450 1 400 300 $ million US$418m US$258m 1 200 US$238 US$329m US$311m 1 000 200 300 US$181 US$158 US$158m 800 600 100 150 US$63m 400 200 0 0 0 2013 2014 2015 2013 2014 2015 $/oz FCF Capex OCF Gold price Nordgold Consistently Generates Free Cash Flow 6

Proven Strategy in a Lower Price Environment Reduce Leverage Positive Free Cash Pay Dividends to Continuation of Flow Generation at All Through Effective Debt Objectives Shareholders Growth Operating Mines Management  Comprehensive cost  Total FY2014  Feasibility Study at  Reduced cost of debt reduction program in dividend at Bouly completed in and improved liquidity USc10.31/GDR Q2 2015. place at all mines and debt profile through  FY2015 AISC of  FY 2015 dividend Construction refinancing in 2014 ongoing  Net debt on 31.12.2015 US$793/oz, a 10% at USc15.61/GDR Achievements  Pilot stage operation improvement YoY  Share buyback reduced to US$584.0m,  8 out of 9 mines were at Gross ongoing, cash position at programme is construction will start US$361.7m ongoing, new FCF positive in 2015, in 2016  Net debt/ LTM EBITDA FY 2015 consolidated program approved  Montagne d’Or FS FCF reached by the Board as of the end of 2015 US$158.1m started in Q4 2015 was 1.1x ♦ Proceed with Bouly ♦ Continue to generate ♦ Continue to efficiently ♦ Maintain dividend and Gross efficiencies manage leverage with payout ratio (30% of construction target level Net debt/ 2016 Strategy net profit attributable ♦ Positive FCF generation ♦ Continue to invest in LTM EBITDA in the to shareholders) at all mines range 0.5-1.0x the pipeline 7

Proven Track Record of DELIVERING on Promises Delivered Exceeded Target Parameter Promised Delivered Project Target? Expectations? Consolidated ✓ ✓ 2013 Production 770 - 850 koz Au 924 koz Au Operations ✓ ✓ Production 870 - 920 koz Au (1) 985 koz Au 2014 ON OPERATING ✓ ✓ AISC US$1,050 - 1,100 / oz (1) US$887 / oz BUSINESS ✓ - Production 925 - 985 koz Au 950 koz Au 2015 ✓ ✓ AISC US$850-900/oz US$793/oz Commercial Production Mid-2013 / January 2013 / ✓ ✓ Bissa Mine & Mine Construction 18 months 15 months ON PROJECT ✓ - DEVELOPMENT Capital Expenditure c. US$250 mln US$250 mln Bissa payback period = 21 months ✓ ✓ 2013 Production 100 koz Au 254 koz Au ✓ ✓ 2013 TCC US$700 / oz US$468 / oz (1) Initial target announced on 24 th February 2014 8

Robust Pipeline to Underpin Future Growth Construction Phase Development Phase Advanced Exploration Early Exploration FS completed Established resources Significant drilling performed Potential resource identified In engineering or construction FS completed or underway Established resources Target delineation Pilot production at Gross Scoping/PEA completed or underway Pistol Bay Montagne d’Or Goengo Production in 1-2 years Prognoz (1) Production in 6-8 years Production in 2-5 years Production in 3-5 years Canada Burkina Faso Onot-Kitoy French Guiana Russia Bouly 1.3 Moz reserves Russia 3.5 Moz resources Burkina Faso Ronguen Zhanok Yimiougou Uryakh Burkina Faso Russia Zinigma Burkina Faso Gross Russia Kolbachi 4.5 Moz reserves Burkina Faso 8.8 Moz resources Kangarse Russia Russia Yeou Lefa Nerchinsk Burkina Faso Corridor Burkina Faso Russia Guinea Satellite Standalone Nordgold Pipeline is Robust and Balanced with Early Stage and Advanced Projects (1) JV with a partner (50/50) 9