Q4 & FY2018 Highlights TSX:TGZ / OTCQX:TGCDF Friday, February 22, 2019
Forward-Looking Statements All information included in this presentation, including any information as to Teranga’s future financial or operating performance and other statements that express management’s expectations or estimates of future performance, other than statements of historical fact, constitute forward-looking information or forward-looking statements within the meaning of applicable securities laws and are based on expectations, estimates and projections as of the date hereof. Forward-looking statements are included for the purpose of providing information about management’s current expectations and plans relating to the future. Wherever possible, words such as “plans”, “expects”, “scheduled”, “trends”, “indications”, “potential”, “estimates”, “predicts”, “anticipate”, “to establish”, “believe”, “intend”, “ability to”, or statements that certain actions, events or results “may”, “could”, “would”, “might”, “will”, or are "likely" to be taken, occur or be achieved, or the negative of these words or other variations thereof, have been used to identify such forward-looking information. Specific forward-looking statements include, without limitation, all disclosure regarding future results of operations, economic conditions and anticipated courses of action. Although the forward-looking statements contained herein reflect management's current beliefs and reasonable assumptions based upon information available to management as of the date hereof, Teranga cannot be certain that actual results will be consistent with such forward-looking information. Such assumptions include, among others, the ability to obtain any requisite governmental approvals, the accuracy of mineral reserve and mineral resource estimates, gold price, exchange rates, fuel and energy costs, future economic conditions, anticipated future estimates of free cash flow, and courses of action. Teranga cautions you not to place undue reliance upon any such forward-looking statements. The risks and uncertainties that may affect forward-looking statements include, among others, the inherent risks involved in exploration and development of mineral properties, including government approvals and permitting, changes in economic conditions, changes in the worldwide price of gold and other key inputs, changes in mine plans and other factors, such as project execution delays, many of which are beyond the control of Teranga. For a more comprehensive discussion of the risks faced by Teranga, and which may cause the actual financial results, performance or achievements of Teranga to be materially different from estimated future results, performance or achievements expressed or implied by forward-looking information or forward-looking statements, please refer to Teranga’s latest Annual Information Form filed with Canadian securities regulatory authorities at www.sedar.com or on Teranga’s website at www.terangagold.com. The risks described in the current Annual Information Form (filed and viewable on www.sedar.com and on Teranga’s website at www.terangagold.com) are hereby incorporated by reference herein. Teranga disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law. Nothing herein should be construed as either an offer to sell or a solicitation to buy or sell Teranga securities. All references to Teranga include its subsidiaries unless the context requires otherwise. This presentation contains references to Teranga using the words “we”, “us”, “our” and similar words and the reader is referred to using the words “you”, “your” and similar words. All dollar amounts stated are denominated in U.S. dollars unless specified otherwise. 2
Richard Young President & CEO
2018: A Year of Achievements Wahgnion Golden Hill Continuous updates – 7 press releases in 2018 Construction advancing well and in line with initial capital spend estimates Initial resource including 415,000 oz indicated Increased gold reserves by 450,000 oz resources grading 2.02 g/t Au and inferred resources of 644,000 oz at 1.68 g/t Au 1 Extended mine life to 13 years Acquired the remaining interest in Golden Hill Improved initial 5-year operating profile Entered into earn-in on adjacent property to the north Filed updated NI 43-101 T echnical Report Côte d’Ivoire Sabodala Making good progress advancing Miminvest Delivered 245,230 oz in 2018, above production properties, particularly Guitry and Dianra guidance and below cost guidance Commenced technical work at Afema Achieved third consecutive year of record production 4 Refer to Endnote (1) in Appendix
Paul Chawrun Chief Operating Officer
2018: 5% Year-Over-Year Increase in Production Three Consecutive Production Record Years of Production (koz Au) 245 233 217 214 212 207 182 131 17 2010 2011 2012 2013 2014 2015 2016 2017 2018 6
Positive Reconciliation to Reserves 26% Grade Mined Q3 2018 NI 43-101 Actual Mine Plan (2) Guidance increase in ounces mined against reserves models over 18-months 2.5g/t – 3.00g/t 2018 3.62g/t 3.14g/t …………………………………… .. due to an increase in tonnes and grade Refer to Endnote (8) in Appendix 7
Higher Fuel Prices Impact Operating Costs in 2018 Total Cash Costs* Mining Costs Milling Costs 2018 ($/oz Au) 2018 2018 ($/t mined) ($/t milled) Guidance: Guidance: Guidance: $700-$750 $2.25-$2.50 $11.00-$12.50 $721 $12.95 $660 $11.34 $2.57 $2.36 2017 2018 2017 2018 2017 2018 $13.36 $11.36 $689 $692 $2.46 $2.27 Q4 2017 Q4 2018 Q4 2017 Q4 2018 Q4 2017 Q4 2018 8 *Refer to Appendix – Non-IFRS Performance Measures
Wahgnion Construction (February 2019) Process Plant – Reagents & Thickener Area 9
Wahgnion: Shifting Focus to Operations Readiness Approaching Final Phases of Construction & Commissioning Engineering and drafting complete Civil, structural and mechanical drawings issued Steel fabrication complete and delivered to site, 25% erected 75% of equipment delivered, including SAG and ball mill shells Main camp area and essential services now finished 95% of concrete poured Construction of the tailings storage facility is near completion Resettlement of multiple families complete 2.8M+ hours worked without a Lost Time Injury Process Plant – Classification Structure, February 2019 10
Wahgnion Construction: Next Steps Focused on First Gold Pour in Q4 2019 • Prepare the commissioning schedule for plant production ramp-up to nameplate capacity following mechanical completion • Revise 2019 mine plan to feed more ore than planned in technical report to support potential for an earlier than planned commissioning • Ongoing construction of the first two resettlement sites (94 households) and community infrastructure Process Plant – CIL Tanks, February 2019 11
Navin Dyal Chief Financial Officer
Increased Gold Sales Drives 2018 Revenue 7% Revenue Revenue Increase ($ millions) ($ millions) 14% Decrease $312.6 $291.7 $88.3 $76.1 Q4 2017 Q4 2018 2017 2018 Three months ended December 31 Twelve months ended December 31 2018 2017 % Change Per ounce 2018 2017 % Change $1,232 $1,279 (4%) Average realized gold price* $1,271 $1,261 1% $1,226 $1,276 (4%) Average spot gold price $1,268 $1,257 1% $1,186 $1,241 (4%) Low $1,178 $1,151 2% $1,279 $1,303 (2%) High $1,355 $1,346 1% 13 *Refer to Non-IFRS Performance Measures in Appendix
Improved Per Ounce Costs for 2018; Beat Cost Guidance Q4 2018 2018 2017 2018 2017 2018 Guidance (Per Ounce) $950 – $1,025 Cost of sales $962 $930 $937 $961 $700 – $750 T otal cash costs* $692 $689 $660 $721 $1,000 – $1,075 $1,105 $938 $1,006 $1,024 All-in sustaining costs* Non-cash inventory movements ($107) ($78) ($66) ($81) ($50) and amortized advanced royalty costs All-in sustaining costs (excluding non-cash $950 – $1,025 $998 $860 $940 $943 inventory movements and amortized advanced royalty costs)* 14 *Refer to Non-IFRS Performance Measures in Appendix
Profit Metrics: Gross Profit and EBITDA* Gross Profit EBITDA* ($ millions) ($ millions) -53% Decrease -31% $24.1 $26.6 Decrease $16.8 $12.5 Q4 2017 Q4 2018 Q4 2017 Q4 2018 17% 18% $111.9 Increase Increase $95.3 $82.1 $69.6 2017 2018 2017 2018 15 *Refer to Non-IFRS Performance Measures in Appendix
Q4 Net Profit (Loss) Attributable to Shareholders & EPS Effected by Higher Income Taxes Net Profit Attributable to Shareholders Adjusted Net Profit Attributable to Shareholders * ($ millions) ($ millions) $5.8 $8.7 86% Adjusting for items not Decrease reflective of underlying performance: -$10.6 $1.2 1. Net losses on gold forward sales of $3.7M Q4 2017 Q4 2018 Q4 2017 Q4 2018 2. Non-cash accretion expense of $1.7M Adjusted Earnings per Share * Earnings per Share 3. Non-cash fair value (basic) (basic) changes of $0.4M 4. Impact of foreign $0.05 86% exchange on deferred Decrease taxes of $3.2M $0.08 -$0.10 $0.01 Q4 2017 Q4 2018 16 Q4 2017 Q4 2018 *Refer to Non-IFRS Performance Measures in Appendix
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