mandalay resources corp. may 2014 investor presentation
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MAY 2014
DELIVERING
VALUE AND GROWTH
This presentation contains "forward-looking statements" within the meaning of applicable securities laws, including statements relating to life of
mine production plans and exploration plans and the growth and strategy of Mandalay. Readers are cautioned not to place undue reliance on
forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on,
among other things, that exploration results at Cerro Bayo, Costerfield, and La Quebrada may not meet management’s expectations, that Cerro
Bayo and Costerfield capital, production and operating cost results may not meet current plans, that reclamation costs associated with
Mandalay’s Furioso property may exceed current estimates, and changes in commodity prices and general market and economic conditions.
The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. Although Mandalay has
attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-
looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be
no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Quality Control and Assurance
Quality control and assurance programs are implemented in line with the standards of National Instrument 43-101.
The exploration program at Costerfield is supervised by Chris Gregory (Member, Australian Institute of Geoscientists accredited Chartered
Professional (Mining)), General Manager of Australasian Business Development for Mandalay and a Qualified Person as defined under National
Instrument 43-101. Mr. Gregory regularly visits Costerfield, supervises the collection and interpretation of scientific and technical information
contained in this presentation.
The exploration programs on the Cerro Bayo and La Quebrada projects are supervised by Ronald Luethe (Member: American Institute of
Professional Geologists and an Idaho Registered Professional Geologist), General Manager of Mandalay Chile Ltda. and a Qualified Person as
defined under National Instrument 43-101. Mr. Luethe visits the Cerro Bayo and La Quebrada projects often, supervises the collection and
interpretation of scientific and technical information contained in this presentation.
Dr. Mark Sander (Member: AusIMM), President of Mandalay, has visited the Costerfield, Cerro Bayo, and La Quebrada projects several times
during 2010, 2011, 2012 and 2013 and has supervised the preparation of this presentation. He has also visited the Challacollo project in 2013
and 2014.
All currency references in US$ unless otherwise indicated
Forward-looking Statements
2
Vision
3
To create exceptional shareholder value through the acquisition of undervalued assets that
can rapidly become cash generative, self fund exploration, establish and maintain high
operating margins and return cash to shareholders within a planned period of time.
Mandalay is committed to operating safely and in an environmentally responsible manner,
while developing a high level of community and employee engagement.
Locations and Tradeflows
4
5
Strategy: Rapid Value Generation and Returns
Entry Strategy:
Acquire high-quality assets at a low cost
relative to ultimate value
Apply management’s extensive operational
and exploration expertise to turn around, grow
and/or develop the assets
Focus on cash returns to shareholders and
prudent use of leverage
Operationally, Mandalay is focused on:
High-margin projects where the Company can
achieve rapid production ramp-ups from
restarts, turn around situations or late-stage
development
Early cash flow to fund exploration, growth and
operational improvements
Building critical mass through acquisition
Capital strategy: Reduce dilution and return
cash to shareholders
Announced dividend policy, currently paying
annualized dividend of 6% of gross revenue(2)
NCIB: Repurchasing up to 5% of the Company
from operational cash flow over 1 year
Dividend Declarations ($CAD MM)
5
Strategy: Rapid Value Generation and Returns
20.6
92.2
171.8 166.9
38.1
2010 2011 2012 2013 2014 (Q1)
Increase Revenues ($MM)
1.7
32.0
79.9 67.7
16.0
2010 2011 2012 2013 2014 (Q1)
Generate Cash (EBITDA - $MM (1))
Focus and Results
$0
$5
$10
$15
$20
2010 2011 2012 2013 2014
C$
MM
$3.2
Dividend Declarations (C$ MM)
$10.9
$4.6
(1) The Company defines EBITDA as earnings before interest, taxes and non cash charges/ (income). EBITDA is presented because the Company
believes it is a useful indicator of relative operating performance. EBITDA should not be considered by an investor as an alternative to net income
or cash flow as determined in accordance with IFRS.
(2) Annual cash dividend paid quarterly, based on 6% of the Company’s trailing quarter’s gross revenue and the future cash requirements of the Company.
Mandalay Q1 2014 Financial Performance
6
Mandalay Q1 2014 Operational Performance
Q1, 2014 2013YE Q1, 2013 2012YE
Saleable Silver oz produced 743,569 3,145,537 611,441 2,911,595
Saleable Gold oz produced 13,195 50,240 10,635 35,125
Saleable Antimony t produced 858 3,275 766 2,481
Q1, 2014 2013YE Q1, 2013 2012YE
Net Cash/All-in Cost/oz Ag at Cerro Bayo, $ 5.81 / 11.31 6.84 / 12.07 8.96 / 14.06 5.67 / 10.70
Net Cash/All-in Cost/oz Au Eq. at
Costerfield, $
800 / 1,052 819 / 1,062 948 / 1,177 1,112 /
1,304
EBITDA, $ million 16.0 67.7 19.8 79.9
Net Income, $ million 5.7 29.4 10.9 41.7
Cash and cash equiv. – (Pending) $ million 70.0 33.5 26.6 17.3
Discovery-fuelled Organic Growth
7
Significant M&I Resource Growth (1,2,3,4)
P&P Reserve Growth (1,2,3,4)
0
20,000,000
40,000,000
60,000,000
2010 2011 2012 2013
Ag (cont. oz)
0
200,000
400,000
600,000
2010 2011 2012 2013
Au (cont. oz)
0
10,000
20,000
30,000
40,000
2010 2011 2012 2013
Sb (cont. t)
1 Source: Cerro Bayo - Roscoe Postle Associates, March 2014, documented in an independent NI 43-101 report filed March 28, 2014
2 Source: Costerfield - SRK Consulting (Australia), March 2014, documented in an independent NI 43-101 report filed March 28, 2014
3 Source: Challacollo – Roscoe Postle Associates, Jan. 30, 2014, in a report filed Feb. 7, 2014
4 Source: La Quebrada – Independent Technical Report filed 16-Aug-2012
0
200
400
600
2012 2013
Cu (MMlbs)
14,000,000
15,000,000
16,000,000
17,000,000
18,000,000
19,000,000
2011 2012 2013
Ag (cont. oz)
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
2011 2012 2013
Au (cont. oz)
0
10,000
20,000
2011 2012 2013
Sb (cont. t)
Total Reserves: 31-December-2013 Ag
(cont. oz)
Au
(cont. oz)
Sb
(cont. t)
Mandalay Proven Reserves 4,705,000 61,000 3,000
Mandalay Probable Reserves 13,197,000 240,000 12,000
Mandalay P&P Reserves 17,902,000 301,000 15,000
Production Growth 2014E
8
$8-$9 million $6-$7
million
$3-$4 million
Capital Expenditure(PP&E)
Capital Development
Capitalized Exploration
1.3 million
2.9 million
3.1 million 3.0 - 3.2 million
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
2011 2012 2013 2014E
Silver (oz)
12,244
17,089
21,482
23,000– 27,000
0
5,000
10,000
15,000
20,000
25,000
30,000
2011 2012 2013 2014E
Gold (oz)
6,678
18,036
28,758
37,000– 43,000
0
10,000
20,000
30,000
40,000
50,000
2011 2012 2013 2014E
Gold (oz)
Costerfield Budget and Production (2014E)
Cerro Bayo Budget and Production (2014E)
$11-$12 million
$13-$14 million
$4-$5 million
Capital Expenditure(PP&E)
Capital Development
Capitalized Exploration
1,576
2,481
3,275 3,000 –
3,300
0
500
1,000
1,500
2,000
2,500
3,000
3,500
2011 2012 2013 2014E
Antimony (Sb)
Challacollo Budget (2014E)
$7 - $8 million
Feasibility &Exploration
(1) Exercise price: C$0.255 - C$1.13; Expiry date: Dec 7, 2014 - Mar 24, 2019 (2) Exercise price: C$0.31 - C$0.465; Expiry date: Nov 30, 2014 (3) Assuming C$1 = 0.911709 $US (4) As of November 5, 2013, the directors and executive officers of the Corporation, as a group, beneficially owned, or controlled or directed, directly or indirectly, approximately
173,783,259 Common Shares, representing approximately 53.76% of the outstanding Common Shares
Capital Structure and Ownership
9
Major Shareholders(4)
Holders % Shares (Million)
West Face Capital 40.3% 136.9
Plinian + Management 10.5% 35.8
Sprott Asset Management 9.9% 33.5
Silver Standard 3.5% 12.0
Arcourt (Byrne) 3.4% 11.7
Baker Steel 3.3% 11.1
Shares, options, and warrants as at March 31, 2014 Millions
(Except Share Price Information)
Share price (Apr. 29, 2014 - close) (C$) 0.95/shr
Shares Outstanding 340.1
Options(1) 19.9
Warrants(2) 15.9
Fully Diluted Shares Outstanding 376.2
Market Capitalization (C$) 323.1
Cash and Cash Equivalents (Pending) 70.0
Total Debt (Pending) 50.0
Total Enterprise Value(3) 274.6
Funding Growth
10
Capital Requirements
2014 2015E 2016E
Cerro Bayo Growth Cerro Bayo Mine Expansion
(1,200 – 1,400 tpd):
$9 million
None None
Costerfield Growth -
(Cuffley)
Cuffley Lode Development:
$15 million
None None
Challacollo Challacollo Feasibility:
$6 million
Challacollo Permit & Build:
$15 million
Challacollo Build:
$60 million
Sustaining -
Costerfield & Cerro Bayo
Sustaining Capital:
$15 million
Sustaining Capital:
$15 million
Sustaining Capital:
$15 million
Yearly Capital
Requirements
$45 million $30 million $75 million
Total Capital Requirements (2014E – 2016E): ~$150 million
Sources of Funding
2014 – 2016
Starting Cash + Gold Exchangeable Financing Proceeds: $70 million
Uncommitted Operational Cash Flow (after Interest, Dividend, Tax, and Exploration) (2014E-2016E): $135 million(1)
Warrant Exercise (2014): $5 million
Total Cash Generation (estimated, not including asset sales): ~$210 million
Cash Headroom through Completion of Challocollo Development & 2016E: ~$60 million
(1) At metal prices: $1,300 Au; $21 Ag
11
$50 Million, Five Year 5.875% Gold Exchangeable Financing The Company must repay $50 million or SPDR Gold Share equivalent of approximately
32,000 oz of gold after five years, whichever has greater value
The Company has the option to increase the financing to $65 million before May 12, 2014
5.875% annual coupon = $2.94 million interest cost per year
Exchangeable at lender’s option for SPDR Gold Shares at a price of $149.99 per share
(currently equivalent to a gold price of approximately $1,556/oz) – represents 20%
premium to April 29 gold price of $1,297/oz
Sinking fund of SPDR Gold Shares to be established in quarterly instalments over last
two years of term
Redeemable by Company (i) after three years if the closing price of the SPDR ETFs
exceeds 130% of the then prevailing exchange price or (ii) if 15% or less of the original
principal amount remains outstanding
Secured by first ranking pledge over Costerfield
12
Management Track Record: Execution, Value Creation
Company History and Milestones
2009 Q4 2010 2011 2012 2013 2014
Financial/
Corporate
• Acquired
Costerfield
gold-antimony
mine for
Mandalay
stock
• Listed on TSX
main board from
TSX-V
• Raised $23
million for
purchase and
restart of Cerro
Bayo silver-gold
mine
• Announced
Normal Course
Issuer Bid
(“NCIB”) to buy
back 5% of
Company’s
shares
• Completed
Substantial Issuer
Bid; reduced FD
share count by 8%
• Completed and
Renewed NCIB
• Paid $3.2 million in
dividends
• Extended credit
facility by $10
million
• NCIB renewed
• Paying $10.9
million in
dividends
(2013 est.)
• Completed
Challacollo
acquisition
• $50 million gold
exchangeable
financing
Operational • Began
Production at
Costerfield
(Dec 2009)
• Began
production at
Cerro Bayo
(Sept 2010)
• Began milling &
shipping at Cerro
Bayo (Jan 2011)
• Increased
production at
both projects
• Doubled silver
reserves, boosted
gold reserves 85%
• Reached design
production at both
operations
• Extended
Costerfield mine
life to 4 years
• Began ramp up at
Cerro Bayo to
1,400 tpd
• Cerro Bayo ramp
up completed:
Q1 2014
• Initiated
Challacollo
feasibility study
(1) Peer group includes: Endeavour Silver, First Majestic Mines, Fortuna Silver, McEwen Mining, and Primero Mining
Share prices as at April 5, 2014
50
100
150
200
250
300
350
400
450
500
550In
dex (
Au
gu
st
3,
2009 =
100)
Mandalay Resources Peers(1) Gold Silver S&P/TSX Composite Index S&P/TSX Global Mining Index
Mandalay: 251%
(total return)
Peers: 150%
Silver: 38%
Gold: 34%
TSX Composite: 31%
TSX Mining: -11%
Q4 2009 - New Management Team
(Mills, Sander & Swarup)
Cerro Bayo Silver-Gold Mine
13
Land package 23,096 hectares
Ownership 100%
2013 silver production 3,145,537 oz
2013 gold production 21,482 oz
2014E silver production 3.0 – 3.2 Moz
2014E gold production 23,000 – 27,000 oz
Current throughput / Goal 1,400 tpd
P&P Reserves 2.5 Mt @ 224 g/t Ag; 2.2 g/t Au
Plant recoveries (Q1 2014) Ag: 91.0%, Au: 87.25%
2013A Cash costs/oz Ag
net Au credits / Q1 2014
$6.84 / $5.81
2014 Planned Exploration
Budget $3 – 4 million
Cerro Bayo Operating Performance
14
$0
$20
$40
$60
$80
0
20,000
40,000
60,000
80,000
100,000
120,000
Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-2013 Q4-2013
$/
Ton
ne
Ton
ne
s P
er Q
ua
rter
Mining Rate and Unit Cost
t Mined Cost/ t Mined
$0
$20
$40
$60
0
20,000
40,000
60,000
80,000
100,000
120,000
Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13
$/
Ton
ne
Ton
ne
s P
er
Qu
arte
r
Processing Rate and Unit Cost
t Processed Cost/ t Processed
$0
$5
$10
$15
$20
0
200,000
400,000
600,000
800,000
1,000,000
Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13
$/
oz
Ag
Ne
t B
ypro
du
ct
Ou
nce
s Si
lve
r P
er
Qu
arte
r
Saleable Silver Produced & Unit Cost
Ag oz Cost/ oz Ag net Au
15
Cerro Bayo District: Target-rich Land Package
NI43-101 Reserve-Resource veins
2013 Infill and Step-Out Drilling
2012 New infill from 2011 Blue Sky successes
2013 Scheduled Blue Sky drill targets
2013- Field work to prep for 2014 drilling
Lucia
Chatito Sb Anomaly
Roadside
Brillantes
Cerro
Viento
Aquila
Sinter Hill
Laguna Verde
High level, Madre-
Aquila-Meseta
Cerro Bayo
Guanaco
Esperanza
Sb Anomaly
Marcela Roadside
Cerro
Viento
Brillantes
Coigues
LAGUNA VERDE
Emerging Extensions and New Veins Under Laguna Verde
Veins with Reserves
Surface Trace
Veins with Reserves
Underground Trace
Target Extensions
Under Laguna Verde
Reported Drill
Intercepts
16
Cerro Bayo M&I Resource Growth Net of Depletion
17 1 Source: Cerro Bayo - Roscoe Postle Associates, March 2014, documented in an independent NI 43-101 report filed March 28, 2014
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
2010 2011 2012 2013
OZS
Ag
END OF YEAR MEASURED PLUS INDICATED RESOURCES
Cerro Bayo M+I Resource Additions vs Depletion (Ag Ozs)
CUMULATIVE DEPLETION Dagny Fabiola Delia NW
Delia SE Marcela Sur Yasna Coyita
Dalila Bianca Trinidad Raul
2.4 X
Net
Add
Cerro Bayo Resources (1) Resource
(t)
Ag
Grade
(g/t)
Ag
(cont. oz)
Au
Grade
(g/t)
Au
(cont. oz)
Measured Resources 411,000 423 5,596,000 3.6 48,000
Indicated Resources 1,633,000 308 16,172,000 3.2 167,000
M&I Resources 2,044,000 331 21,768,000 3.3 214,000
Inferred Resources 433,000 400 5,580,000 3.3 46,000
Cerro Bayo
Reserves (1)
Ore
(t)
Ag
Grade
(g/t)
Ag
(cont. oz)
Au
Grade
(g/t)
Au
(cont.
oz)
Proven Reserves 516,000 283 4,705,000 2.5 41,000
Probable Reserves 1,967,000 209 13,197,000 2.1 134,000
P&P Reserves 2,483,000 224 17,901,000 2.2 174,000
Costerfield Gold-Antimony Mine: Overview
18
2014 Planned Exploration
Budget $4 – 5 million
Land package 1,293 hectares
Ownership 100%
2013 gold production 28,758 oz
2013 antimony production 3,275 t
2014E gold production 37,000 – 43,000 oz
2014E antimony production 3,000 – 3,300 t
Current throughput 400 tpd
P&P Reserves 420,000 tonnes @ 9.2 g/t Au; 3.6% Sb
Plant recoveries (Q1 2014) Au: 90.75%, Sb: 94.18%
2013A Cash cost/oz Au Eq. / Q1 2014 $819 / $800
Costerfield Operating Performance
19
$0
$100
$200
$300
$400
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
Q4-09(Dec.only)
Q2-10 Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13
AU
D/
Ton
ne
Ton
nes
Pe
r Q
uar
ter
Mining Rate and Unit Cost
t Mined Cost/ t Mined
$0
$20
$40
$60
$80
$100
$120
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Q4-09(Dec.only)
Q2-10 Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13
AU
D/
Ton
ne
Ton
ne
s P
er
Qu
arte
r
Processing Rate and Unit Cost
t Processed Cost/ t Processed
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Q4-09(Dec.only)
Q2-10 Q4-10 Q2-11 Q4-11 Q2-12 Q4-12 Q2-13 Q4-13
USD
/ O
z A
u E
q.
Ou
nce
s P
er
Qu
arte
r
Au Equivalent Production and Cost
Oz Au Eq. Cost/ Au Eq. Oz
20
Costerfield – Long Section
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
2009 2010 2011 2012 2013
OZ
Au
Eq.
END OF YEAR MEASURED PLUS INDICATED RESOURCES
Costerfield M+I Resource Additions vs Depletion (AuEq Ozs)
CUMULATIVE DEPLETION Augusta Brunswick Cuffley
21
Costerfield M&I Resource Growth Net of Depletion
Costerfield
Resources (1)
Resource
(t)
Sb
Grade
(%)
Sb
(cont. t)
Au
Grade
(g/t)
Au
(cont. oz)
Measured 191,000 4.3% 8,000 8.4 51,000
Indicated 605,000 3.7% 22,000 9.6 187,000
M&I 796,000 4.1% 32,000 9.3 238,000
Inferred 569,000 3.8% 22,000 7.4 135,000
Costerfield
Reserves (1)
Ore
(t)
Sb
Grade
(%)
Sb
(cont. t)
Au
Grade
(g/t)
Au
(cont. oz)
Proven 71,000 4.4% 3,000 8.3 20,000
Probable 350,000 3.4% 12,000 9.4 106,000
P&P 420,000 3.6% 15,000 9.2 126,000
1 Source: Costerfield - SRK Consulting (Australia), March 2014, documented in an independent NI 43-101 report filed March 28, 2014
3.8 X
Net
Add
Challacollo Silver-Gold Project: Overview
22
Land package 4,000 hectares
Ownership 100%
Location 130 km SE of Iquique, Chile
Mineralization Epithermal, oxidized Ag-Au
Elevation approx. 1,500 metres ASL
Resource Indicated: 1 mt @ 242 g/t Ag;
Inferred: 4 mt @193 g/t Ag
23
Plan funded from cash flow
• 12 mo Feasibility Study: $7 – $8 million
Environmental, community, cultural baselines for permitting
Drill 8,000 m for infilling existing Inferred Resource and extensions
Resource update
Metallurgical testing– crushing, grinding, agitation leach
Mine design, plant design
Capital and operating costing
Financial case and conversion to reserves
• Permitting
Submission of EIA Q1, 2015
Receipt of permits – goal EOY 2015
• Build
12 months build (est.) in 2016
• Production
First production – Goal: Q1 2017
Challacollo Development Plan
24
Lolon Vein
1 Source Challacollo: NI 43-101 Technical Report on the Challacollo Silver-Gold Project, Region 1, Chile. Effective date January 30, 2014.
Filed on SEDAR February 7, 2014.
Challacollo Resources (3) Resource
(t) Au Grade
(g/t)
Ag Grade
(g/t)
Au
(cont. oz)
Ag
(cont. oz) Measured Resources - - - - - Indicated Resources 1,030,000 0.4 242 13,000 8,000,000 M&I Resources 1,030,000 0.4 242 13,000 8,000,000 Inferred Resources 3,900,000 0.3 193 40,000 24,300,000
25
Peer Comparison: Production, Cost, Financials
2013A Production 2013A Financials
Ag
(oz)
Au
(oz)
Other Ag Eq (oz)
(Au + Ag)
Revenue
($MM)
EBITDA
($MM)
EBITDA Margin
(%)
Mandalay Resources 3,145,537 50,240 3,275 t Sb 5,886,848 166.9 67.7 40.6
Endeavour Silver 6,813,069 75,578 - 10,936,931 276.8 100.0 36.1
First Majestic Mines 10,641,465 10,040 16,000 t Pb+Zn 11,189,291 251.3 70.1 27.9
Fortuna Silver 4,631,264 21,242 19,000 t Pb+Zn 5,790,319 137.4 41.9 30.5
McEwen Mining 3,135,468 79,158 - 7,454,70 45.98 - -
Primero Mining 6,050,000 111,983 - 12,160,276 200.3 87.3 43.6
P+P Reserves Market Comparables
Ag
(oz)
Au
(oz)
Other Reserve Grade
Ag Eq (g/t)
(Au + Ag)
Market
Capitalization FD
(C$MM)
2013 EPS
Last 12M
Dividend
Paid/Share
Mandalay Resources 17,902,000 301,000 15,000t Sb 568 357.4 $0.09 $0.03429
Endeavour Silver 11,603,200 139,400 - 270 551.7 ($0.90) $0
First Majestic Mines 108,627,132 - - 174 1,289.3 ($0.33) $0
Fortuna Silver 36,300,000 235,900 - 229 562.2 ($0.15) $0
McEwen Mining 14,724,500 200,606 - 899 793.1 ($0.50) $0
Primero Mining 64,814,000 2,243,000 - 146 1,019.4 ($0.04) $0
Source: Company reports and Bloomberg
Market capitalization as at April 29, 2014
Ag Eq oz converted at 55/1 Au/Ag. Metal prices: Ag price of $28.92 and Au price of $1,578
26
Peer Comparison: Production, Cost, Financials
0
100
200
300
400
500
600
700
800
900
1000
P+P Reserve Grade FullyDiluted Ag Eq (g/t)
Mandalay Resources
Endeavour Silver
First Majestic Silver
Fortuna Silver
McEwen Mining
Primero Mining
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2013 EBITDA Margin
$0
$5
$10
$15
$20
$25
$30
$35
Fully Loaded 2013 CashCost/Ag Eq oz
$0
$20
$40
$60
$80
$100
$120
Market Cap per 2014EAg Eq Production (oz)
$0.000
$0.010
$0.020
$0.030
$0.040
Last 12M Dividend Paidper Share
$0
$5
$10
$15
$20
$25
$30
$35
Market Cap per P+PReserves (Ag Eq oz)
Market capitalization as at April 29, 2014
Ag Eq oz converted at 55/1 Au/Ag
Metal prices: Ag price of $28.92 and Au price of $1,578
Second highest grade
reserves
(Ag Eq oz)
Second highest EBITDA
margin
Lowest fully loaded cost
(Ag Eq oz)
Second lowest market
cap per estimated annual
production of Ag Eq oz
Second lowest market
cap per P+P reserves oz
Highest dividend paid per
share
27
Investment Proposition Execution-focused management with track record of acquisition, operational and exploration success,
growth and value generation
High-quality, cash flowing asset portfolio with major exploration upside and full project pipeline
Strong balance sheet, Challacollo development and capital programs funded
Rapid increase in production and margins through low-capex organic growth and operational
efficiencies
Returning cash to shareholders and reducing dilution – share buyback program in place
Company dividend policy based on 6% trailing revenues
Continued growth through further acquisitions
MAY 2014
DELIVERING
VALUE AND GROWTH
For more information, please contact:
Greg DiTomaso
Tel: 647.260.1566
Email: g.ditomaso@mandalayresources.com
Company Website: www.mandalayresources.com
Twitter: @MandalayAuAg
29
Management and Board of Directors
Senior Management
Board of Directors
Brad Mills, CEO and
Executive Director
Former CEO Lonmin
plc, over 30 years of
experience in Copper,
Gold, PGMs
Mark Sander, President
28 years of experience in
exploration, strategy and
operating improvements
Sanjay Swarup, CFO
and Executive Director
Former Lonmin plc, over
20 years of industry
experience
Belinda Labatte,
Corporate Secretary
Over 10 years of
experience in capital
markets and investment
banking
Braam Jonker,
Chairman
Peter R. Jones,
Independent Director
Tony Griffin,
Independent Director
Robert Doyle,
Independent Director
Dominic Duffy, COO
Mining Engineer with
extensive technical and
operational management
experience
Numbers may differ slightly from source documents due to rounding
30
Mandalay Reserves
Cerro Bayo Reserves (1) Ore
(t)
Ag Grade
(g/t)
Ag
(cont. oz)
Au Grade
(g/t)
Au
(cont. oz)
Proven Reserves 516,000 283 4,705,000 2.5 41,000
Probable Reserves 1,967,000 209 13,197,000 2.1 134,000
P&P Reserves 2,483,000 224 17,901,000 2.2 174,000
Costerfield Reserves (2) Ore
(t)
Sb Grade
(%)
Sb
(cont. t)
Au Grade
(g/t)
Au
(cont. oz)
Proven Reserves 71,000 4.4 3,000 8.3 20,000
Probable Reserves 350,000 3.4 12,000 9.4 106,000
P&P Reserves 420,000 3.6 15,000 9.2 126,000
TOTAL RESERVES:
31-December-2013
Ag
(cont. oz)
Au
(cont. oz)
Sb
(cont. t)
Mandalay Proven Reserves 4,705,000 61,000 3,000
Mandalay Probable Reserves 13,197,000 240,000 12,000
Mandalay P&P Reserves 17,902,000 301,000 15,000
1 Source: Roscoe Postle Associates, March 2014 documented in an independent NI 43-101 report filed March 28, 2014
2 Source: SRK Consulting (Australia), March 2014, documented in an independent NI 43-101 report filed March 28, 2014
31
Mandalay Resources
Cerro Bayo Resources (1) Resource
(t)
Ag Grade
(g/t)
Ag
(cont. oz)
Au Grade
(g/t)
Au
(cont. oz)
Measured Resources 411,000 423 5,596,000 3.6 48,000
Indicated Resources 1,633,000 308 16,172,000 3.2 167,000
M&I Resources 2,044,000 331 21,768,000 3.3 214,000
Inferred Resources 433,000 400 5,580,000 3.3 46,000
Costerfield Resources (2) Resource
(t) Sb Grade
(%)
Sb
(cont. t)
Au Grade
(g/t)
Au
(cont. oz)
Measured Resources 191,000 4.3% 8,000 8.4 51,000
Indicated Resources 605,000 3.7% 22,000 9.6 187,000
M&I Resources 796,000 4.1% 32,000 9.3 238,000
Inferred Resources 569,000 3.8% 22 ,000 7.4 135,000
TOTAL RESOURCES Ag
(cont. oz) Au
(cont. oz) Sb
(cont. t) Cu
(cont. lb)
Measured Resources 5,596,000 99,000 8,000 0
Indicated Resources 35,372,000 367,000 22,000 459,000,000
M&I Resources 40,968,000 465,000 32,000 459,000,000
Inferred Resources 30,280,000 221,000 22,000 13,000,000
1 Source: Cerro Bayo - Roscoe Postle Associates, March 2014 documented in an independent NI 43-101 report filed March 28, 2014
2 Source: Costerfield - SRK Consulting (Australia), March 2014, documented in an independent NI 43-101 report filed March 28, 2014
La Quebrada Resources (4) Resource
(t) Cu Grade
(%)
Cu
(cont. lb)
Ag Grade
(g/t)
Ag
(cont. oz) Measured Resources 0 0 0 0 0
Indicated Resources 34,800,000 0.6% 459,000,000 10 11,200,000
M&I Resources 34,800,000 0.6% 459,000,000 10 11,200,000
Inferred Resources 1,000,000 0.6% 13,000,000 11 400,000
Challacollo Resources (3) Resource
(t) Au Grade
(g/t)
Ag Grade
(g/t)
Au
(cont. oz)
Ag
(cont. oz) Measured Resources - - - - - Indicated Resources 1,030,000 0.4 242 13,000 8,000,000 M&I Resources 1,030,000 0.4 242 13,000 8,000,000 Inferred Resources 3,900,000 0.3 193 40,000 24,300,000
3 Source: Challacollo – Roscoe Postle Associates, Jan, 30, 2014, in a report filed February 7, 2014.
4 Source: La Quebrada – Independent Technical Report filed 16-Aug-2012.
Significant Resource Increase Net of Depletion in 2013
Measured and Indicated
• Contained Sb increased by 52%
• Contained Au increased by 31%
• Contained Ag increased by 18%
Inferred
• Contained Ag increased by 811%
• Contained Au increased by 26%
• Contained Sb increased by 13%
Source of Additions
• Infilling Cuffley and N-lode
• Acquiring Challacollo
• Expanding Marcela etc.
Source of Additions
• Acquiring Challacollo
• Fabiola and Yasna extensions
31
33
Safety, Health, Environment and Community
Safety & Health Environment & Community Employees
ACTIONS
• Spending on S&H (including
safety training) tripled in last
two years
• Focus on line management
safety leadership, systems and
behaviours
• Improved S&H safety
processes & compliance
• Implementation of DuPont
safety system in 2013 at both
operations
• Extensive training and
equipping of mine rescue team
at Cerro Bayo
• Spent over 200% more in 2012
on environment & community
projects as compared to 2011
• Commitment to local purchases
& payrolls
• Development of new water &
mine waste solutions at
Costerfield
• Closure works completion at
Furioso Mine Site
• Supplying various workshops for
local community at Cerro Bayo
• University scholarships for local
school leavers at Cerro Bayo
• Employee selection process
improved
• Focus on local hires including
management positions
• Increased hours of training in 2012
by +80% as compared to 2011
• High level executive coaching for leadership team
RESULTS
• Consolidated lost time injury
frequency rate approximately
halved
• Improved return to work
performance
• Maintained high levels of
attendance at mine sites
• More prosperous local
communities
• Reduced impacted land area
• Zero incidences of unpermitted
discharge at both operations
• 3 year collective contract signed
with Cerro Bayo union in 2012
• Increased presence of local hires
among workforce and supervisors
• Reduced employee turnover at mine
sites
• More productive employees, leading
to lower unit costs
Metal Price Update
34 Source: Metal Bulletin
1,0001,1001,2001,3001,4001,5001,6001,7001,800
01
/De
c/1
30
5/D
ec/
13
09
/De
c/1
31
3/D
ec/
13
17
/De
c/1
32
1/D
ec/
13
25
/De
c/1
32
9/D
ec/
13
02
/Jan
/14
06
/Jan
/14
10
/Jan
/14
14
/Jan
/14
18
/Jan
/14
22
/Jan
/14
26
/Jan
/14
30
/Jan
/14
03
/Feb
/14
07
/Feb
/14
11
/Feb
/14
15
/Feb
/14
19
/Feb
/14
23
/Feb
/14
27
/Feb
/14
03
/Mar
/14
07
/Mar
/14
11
/Mar
/14
15
/Mar
/14
19
/Mar
/14
23
/Mar
/14
27
/Mar
/14
31
/Mar
/14
04
/Ap
r/1
4
Au
pri
ce U
SD/o
z
GOLD PRICE - DAILY SPOT LME
Actual Au-Price LME USD
15.00
20.00
25.00
30.00
35.00
40.00
01
/De
c/1
30
5/D
ec/
13
09
/De
c/1
31
3/D
ec/
13
17
/De
c/1
32
1/D
ec/
13
25
/De
c/1
32
9/D
ec/
13
02
/Jan
/14
06
/Jan
/14
10
/Jan
/14
14
/Jan
/14
18
/Jan
/14
22
/Jan
/14
26
/Jan
/14
30
/Jan
/14
03
/Feb
/14
07
/Feb
/14
11
/Feb
/14
15
/Feb
/14
19
/Feb
/14
23
/Feb
/14
27
/Feb
/14
03
/Mar
/14
07
/Mar
/14
11
/Mar
/14
15
/Mar
/14
19
/Mar
/14
23
/Mar
/14
27
/Mar
/14
31
/Mar
/14
04
/Ap
r/1
4
Ag
pri
ce U
SD/o
z
SILVER PRICE - DAILY SPOT LME
Actual Ag-Price LME USD
9,000
10,000
11,000
12,000
13,000
14,000
01
/De
c/1
30
5/D
ec/
13
09
/De
c/1
31
3/D
ec/
13
17
/De
c/1
32
1/D
ec/
13
25
/De
c/1
32
9/D
ec/
13
02
/Jan
/14
06
/Jan
/14
10
/Jan
/14
14
/Jan
/14
18
/Jan
/14
22
/Jan
/14
26
/Jan
/14
30
/Jan
/14
03
/Feb
/14
07
/Feb
/14
11
/Feb
/14
15
/Feb
/14
19
/Feb
/14
23
/Feb
/14
27
/Feb
/14
03
/Mar
/14
07
/Mar
/14
11
/Mar
/14
15
/Mar
/14
19
/Mar
/14
23
/Mar
/14
27
/Mar
/14
31
/Mar
/14
04
/Ap
r/1
4
Sb p
rice
USD
/t
ANTIMONY PRICE - DAILY ROTTERDAM WAREHOUSE
Actual Sb-Price Market USD
2.70
2.90
3.10
3.30
3.50
3.70
01
/De
c/1
30
5/D
ec/
13
09
/De
c/1
31
3/D
ec/
13
17
/De
c/1
32
1/D
ec/
13
25
/De
c/1
32
9/D
ec/
13
02
/Jan
/14
06
/Jan
/14
10
/Jan
/14
14
/Jan
/14
18
/Jan
/14
22
/Jan
/14
26
/Jan
/14
30
/Jan
/14
03
/Feb
/14
07
/Feb
/14
11
/Feb
/14
15
/Feb
/14
19
/Feb
/14
23
/Feb
/14
27
/Feb
/14
03
/Mar
/14
07
/Mar
/14
11
/Mar
/14
15
/Mar
/14
19
/Mar
/14
23
/Mar
/14
27
/Mar
/14
31
/Mar
/14
04
/Ap
r/1
4
CU
pri
ce U
SD/l
b
COPPER PRICE - DAILY SPOT LME
Actual Cu-Price LME USD
Antimony Facts
35
140,000 t/y global market
• Sold either as metal ingots or various grades of antimony oxides and trioxides
• Primary use as fire retardant in fabrics and plastics (trioxides)
• Relatively minor uses in electronics, with possible new uses in development, e.g.
in batteries
• Ingredient of lead alloys as hardener (antimony metal)
• Consumption growth in line with global GDP growth
Market dominated and prices set by China
• Declining Chinese mine production as reserves depleted and environmental
controls strengthened, closing marginal mines
• Chinese beginning to invest in mines outside China
• Two dominant Chinese smelters, only one of which recovers Au
Gold Equivalent Ounces Calculation
36
***Au Eq. oz produced is calculated by multiplying the saleable quantities of Au, Ag, and Sb in the period by the respective average market prices of the commodities in the period,
adding the three amounts to get a “total contained value based on market price”, and then dividing that total contained value by the average market price of Au in the period.
Average Au price in the period is the average of the monthly LME PM fix, average Sb price is the average of the monthly high and low Rotterdam warehouse prices, and average
Ag price is the average of the monthly London Broker’s silver spot price, all reported in www.metalbulletin.com. The monthly commodity prices are calculated as the average of the
daily prices, with holiday and weekend day prices carried forward from the last business day.
Au Eg. oz for each of the low range and high range guidance is calculated by multiplying (i) total Au oz by an assumed US$1,600/oz Au price, (ii) total Ag oz by an assumed
US$32.00/oz Ag price and (iii) total Sb tonnes times an assumed US$12,000/t Sb price, then, in each case, dividing by the assumed US$1,600/oz Au price.
Silver Equivalent Ounces Calculation Ag Eq oz converted at 54/1 Au/Ag at metal prices: Ag price of $28.92 and Au price of $1,578.00
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