new 2014 h1 results h1 result.pdf · 2014. 8. 25. · 13 财务业绩financial highlight disclaimer...

2014 H1 Results

财务业绩 Financial HighlightDisclaimer

Disclaimer

The material in this presentation does not constitute any proposals concerning the subscription or sales of

the Stocks of Zijin Mining Group Co., Ltd. (“Zijin” or “the Group”), any invitation for the subscription or offer

of the Stocks of the Group, or any basis or reliance of any contract or promise.

This presentation includes forward-looking statements. Such forward-looking statements are based on

numerous assumptions regarding Zijin’s present and future business strategies and the environment in which

Zijin will operate in the future. It involves known and unknown risks, uncertainties and other uncontrollable

factors which may cause the actual results, performance or achievements of Zijin, to be materially different

from any future results, performance or achievements expressed or implied by such forward-looking

statements. These forward-looking statements speak only as of the date of this presentation.

3


Contents

1. 2014 H1 Results Review

2. Project Construction, Exploration，Investment, Environmental Protection and Safety

3.2014 Targets and H2 Management Measures

4


2014 H1 Financial Results

Items 2014/6/30 2013/6/30(%)YOY

Revenue (RMB 000)23,986,054 25,987,634 -7.70

Total Profit (RMB 000)1,849,820 2,084,368 -11.25

Attributable Net Profit

(RMB 000)1,109,402 1,098,050 1.03

Operating Cash Flow

(RMB 000) 1,763,961 2,037,135 -13.41

EPS-Basic

(RMB Per Share）0.051 0.05 2.00

5


2014 H1 Financial Figures

Items 2014/6/30 2013/12/31（%）

Comparison

Total Assets (RMB 000) 73,994,006 66,898,389 10.61

Attributable Net Assets

(RMB 000)27,069,238 27,612,258 -1.97

Net Asset Value Per Share

(RMB/Share)1.253 1.272 -1.49

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Disclaimer2014 H1 Total Profit Change Factors

SalesVolume

UnitPrice

Impair-ment

Expenses Loss from

RefiningSector

OperatingTax &

Others

20142014 H1

TotalProfit

(RMB 00,000,000)

Note: The data are comparison between 2014 and 2013

2013 H1TotalProfit

Product prices declined dramatically

in 2014 H1, gold and copper dropped

15.2% and 8.3% respectively,

resulting in a yoy decrease of RMB

1.191B in total profit, yet Zijin

achieved a yoy increase of 1.03% in

attributable net profit due to:

•Increase in production has partially

offset the negative impact on profit

caused by decreased metal prices，increased profit by RMB 405M

•Loss from refining sector reduced

substantially, increased profit by RMB

396M

•Financial and other expenses saved

RMB 174M

•Effective cost control raised profit by

RMB 2.087B

Results Highlight

UnitCost

7


2014 H1 Sales Revenue and Gross Margin Analysis

Structure of Revenue Structure of Gross Margin

8


2014 H1 Production

Items 2014/6/30 2013/6/30（％）YOY

Gold (Kg) 59,656 55,664 7.17

Mined gold (kg) 15,612 14,724 6.03

Gold（kg） 44,044 40,940 7.58

Copper (t) 181,321 158,843 14.15

Mined copper (t) 70,437 61,695 14.17

Copper (t) 110,884 97,149 14.14

Zinc (t) 139,263 117,354 18.67

Mined Zinc (t) 46,440 36,827 26.10

Zinc (t) 92,823 80,527 15.27

Lead (t) 5,099 4,350 17.22

Silver (kg) 134,822 146,590 -8.03

Iron Ore（0000 t） 124.51 97.88 27.21

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财务业绩 Financial HighlightDisclaimer2014 H1 Cost

(Unit Sales Cost) 2014/6/30 2013/6/30（%）YOY

Mined Gold （RMB/g) 149.33 146 2.28

Gold (RMB/g) 257.13 299.77 -14.22

Mined Silver (RMB/g) 1.58 1.56 1.28

Mined Copper (RMB/t) 17,305 18,246 -5.16

Copper (RMB/t) 42,298 48,146 -12.15

Mined Zinc (RMB/t) 3,256 3,370 -3.38

Zinc (RMB/t) 12,733 12,619 0.90

Iron Ore (RMB/t) 197 228 -13.60

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2014 H1 Gross Margin

Product 2014/6/30(%) 2013/6/30(%) % Points

Mined Gold 37.69 48.06 -10.37

Gold 0.55 -1.13 1.68

Mined Silver 35.79 52.96 -17.17

Mined Copper 52.02 55.78 -3.76

Copper -0.78 -3.92 3.14

Mined Zinc 56.89 55.52 1.37

Zinc 0.68 2.46 -1.78

Iron Ore 63.83 66.06 -2.23

Total 16.19 17.23 -1.04

Total (Excluding Refined Products) 49.66 51.63 -1.97

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2014 H1 Gross Margin

Total

（Exclud

ing

Refined P

roduc

ts

）

Total

Iron O

re

Mined Zinc

Mined Copper

Mined Silver

Mined Gold

2014 H1 2013 H1

Total

（Exclud

ing

Refined P

roduc

ts

）

Total

Iron O

re

Mined Zinc

Mined Copper

Mined Silver

Mined Gold48.06%

51.63%

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2014 H1 Cost Analysis

Total Gross Margin excluding refined products is 49.66%, a yoydecrease of 0.95 percentage point

Total Gross Margin is 16.19%,a yoy decrease of 1.04 percentage points, the main reason is metal prices dropped dramatically in 2014 H1 over the same period in 2013 H1

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2014 H1 Peer Comparison

Source: H1 reports

USD/CNY=6.15

Peer Comparison on Results

Results show as of 13 August, Zijin ranked 2nd in revenue, 3rd in net profit

311.19

217.10

239.86

110.70 106.40

33.83 49.20

37.52

-11.07 17.22 11.09

17.84 4.92 4.31

-1.23 8.00

-50.00

0.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

Barrick

Newmont

Zijin

Goldcorp

Kinross

Eldorado

Yamana

Randgold

营业收入 Revenue 归母净利润 Attributable Net Profit

(RMB 00,000,000)

Note：P/E ratios here are based on H1 or Q1 net profits of the listed companies above and their closing prices on 11 August.

Peer Comparison on P/E Ratio

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Major Gold Mines - Zijinshan Gold and Copper Mine

2014 H1

2013 H1

(%)YOY

Mined Gold (kg) 5,021 5,240 -4.18

Copper (t) 18,597 14,078 32.1

Net Profit(RMB0000 ) 54,612 70,329 -22.35

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Major Gold Mines - Jilin Hunchun Gold and Copper Mine

2014 H1

2013 H1

(%)YOY

Mined Gold (kg) 967 895 8.0

Copper (t) 4,088 3,753 8.9

Net Profit (RMB0000 ) -4,239 15,376 -127.6%

Note: This negative net profit resulted from disposals of equities and creditors’ rights.

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Major Gold Mines - Guizhou Shuiyindong Gold Mine

2014 H1

2013 H1

（%）YOY

Mined Gold (kg) 881 1,108 -20.5

Net Profit (RMB0000) 751 6,958 -89.21

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财务业绩 Financial HighlightDisclaimerOverseas Gold Mines - Norton Gold Fields

2014

H1

2013

H1

（%）

YOY

Attributable Gold

Production (kg) 2,517 2,660 -5.4

Net Profit(A$000 ) 2,441 773 216%

Cash cost decreased from A$1239/oz at

the end of 2012 to A$996/oz in 2014 H1

Offered to takeover Bullabulling Gold

Limited (ASX:BAB), aiming to possess

mineral resources of 3.75 million ounces

(117t) of gold; As of 30 June, 41.35% of

BAB shareholders accepted the offer (over

50% now); the offering will expire on 18,

August

Mineral resource has increased

substantially, and gold reserve has

maintained above 1M oz

As the exchange gain due to stronger AUS$ offset the combined effects of decrease in profit,

reduction of tax benefits and increase of impairment loss and administrative expenses, net profit

after tax increased

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Overseas Gold Mines - ZGC in Tajikistan

ZGC produced 772.23 kg of gold in the first half of 2014, 4.51% increase over

the same period last year. It is a major gold producer and tax payer in Tajikistan

Having invested around RMB 1.377 billion for technical upgrading, including a

10000t/d mineral processing system, which is scheduled to start trials in

August. After completion of the upgrading project, the gold productivity of ZGC

will be increased by 3.5t per year

Based on incomplete statistics, donation has exceeded 2 million USD over the

years for local medical care, education, disaster relief and social welfare

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Major Copper Mines

Xinjiang Ashele

Copper Mine

2014 H1 2013 H1 （%）YOY

Copper (t) 16,968 16,211 4.7

Zinc (t) 6,593 4,343 51.8

Silver (kg) 10,168 13,004 -21.8

Net Profit (RMB 0000) 32,172 39,325 -18.19

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Major Copper Mines

2014 H1 2013 H1(%)YOY

Copper (t) 15,416 13,430 14.8

Net Profit (RMB0000 ) 20,380 21,389 -4.72

Qinghai Deerni Copper Mine

Heilongjiang Duobaoshan

Copper Mine

2014H1

2013H1

(%)YOY

Copper (t) 13,031 11,401 14.3

Net Profit (RMB 0000) 9,663 14,509 -33.4

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Other Major Facilities

2014 H1

2013 H1

(%)YOY

Copper (t) 107,000 93,440 14.5

Silver (kg) 46,169 58,233 -20.7

Net Profit (RMB 0000) -6,982 -26,093 -73.2

Zijin Copper

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2014 H1 2013 H1（%）YOY

Mined Gold (kg) 1,220 250 387.6

Net Profit (RMB0000) 454 -300.22

Turned Loss to Profit

Longnan ZiJin

Longnan Zijin accomplished a dramatic increase in gold production in 2014 H1 due to:

Heap leaching production system started in March, ahead of schedule

New floatation mill overfulfilledproduction target

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2014 H1

2013 H1

(%)YOY

Zinc (t) 92,823 80,527 15.3

Net Profit (RMB 0000) -6,566 -4,208 -56.04

Bayannaoer Zinc Smelter

Wulatehouqi Zijin2014 H1

2013 H1

(%)YOY

Zinc (t) 21,088 17,179 22.8

Net Profit (RMB 0000) 6,063 10,507 -42.3

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Contents

2014 H1 Results Review

Project Construction, Exploration，Investment, Environmental Protection and Safety

2014 Targets and H2 Management Measures

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财务业绩 Financial HighlightDisclaimerMajor Project Construction

Capex on project construction has reached RMB 1.6 Billion with a full year

budget of RMB 4 billion

Major Construction Program in H1: Hunchun Zijin 10000t/d waste utilization

program, Wuhou Zijin Sanguikou Lead and Zinc mine, Russia Tuwa Lead and Zinc

Mine, ZGC Jilao 10000t/d mineral processing system, kirghizia Zuoan Gold Mine

2500t/d mineral processing system; these programs are expected to start operation

in 2014 H2

Major Construction Program in H2: Zijinshan Luoboling Copper and Molybdenum

Mine, Zijinshan Copper Mine’s new flotation plant, Ashele Copper Mine deeper

exploration program, Nanwenhe Tungsten Mine’s technical improvement program,

Guizhou Shuiyindong thermal pre-oxidation project, etc.

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Exploration Progress

Completed borehole surveying of 125,000m, hole exploration of 4,000m, trenching exploration of 17,000sqm, investing a total of RMB 119M for geological exploration

New reserves explored in 2013

• 60.5t of Gold

• 402,000t of Copper

• 1.91Mt of Lead & Zinc

• 32,000t of Molybdenum

• 21,000t of Tungsten

• 216t of Silver

• 23.48Mt of Iron Ore

• 244 Mining Rights with 3,766 sqkm

• 246 Exploration Rights with 846 sqkm

As of 30 June, 2014

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External Investment

Obtained 25.27% stake of NKWE Platinum Limited, which is a company listed in ASX, through conversion of convertible bonds, additional offering and third-party equity purchase, where total investment reached around A$22M, gaining attributable mineral resources of 4.35 Moz (around 135t) of 3PGE+Au

Platinoid resources are rare in China and South Africa is a vital supplying field for Platinoid metals in the world. The acquisition of NKWE allows Zijin to take control of an important piece of platinoidresource in South Africa. This is an important opportunity for Zijinto enter into the mining sector in Africa with great strategic significance.

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Spent RMB 700 M to acquire 70% stake of Kunyu Mining, which owns five gold mines that possess mineral resources of 56.92t of gold with an average grade of 4.3g/t. These gold mines could possibly form a giant gold mine field together with Zijin’s Luyuangou Gold Mine with synergy


External Investment

Acquired 10% stake of Makeng Iron Mine, thus reached a cumulative stake of 41.5%

Acquired 100% stake of Zijinshe Silver Mine of Jiuxin Company

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Overseas Mining Fund H Share Buyback

Capital Market Operation

Sprott International

Mining Fund has put the

respective advantages of

the mining company and

the fund management

company into good use

while investing, and

achieved great results in

the first half of 2014,

yielding 17.3%

Bought back a total of

54,302,000 H shares in

the first half of 2014. Zijin

plans to continue H share

buyback in the second

half when opportunities

arise.

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Environmental Protection & Safety

Seven facilities, including Zijinshan Gold and Copper Mine, Wuping Zijin, Longnan Zijin, WuhouZijin, Tongling Zijin, Xinjiang Jinbao and Fuyun Jinshan, are selected as the fourth batch of green mining pilot unit under the National Land and Resources Department. Together with GuizhouZijin and Xinjiang Ashele, the company possesses 9 national green pilot units

Enhanced and improved environmental protection and safety by strengthening assessment of production safety and hazard management

Deerni Tailings Pond 阿舍勒尾矿库Zijinshan Gold and Copper Mine

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Contents

2014 H1 Results Review

Project Construction, Exploration，Investment, Environmental Protection and Safety

2014 Targets and H2 Management Measures

32


2014 Targets

2014 Targets 2013 Production%YOY

Mined Gold (t) 34 32 6.25

Mined Copper (t) 140,000 125,060 11.95

Mined Silver (t) 160 154 3.90

Mined Lead and Zinc

(t)160,000 80,898 97.78

Iron ore (t) 2,750,000 2,610,099 5.36

Gold (t) 60 77 -22.08

Silver (t) 150 174 -13.79

Copper (t） 220,000 207,732 5.91

Zinc (t) 200,000 181,312 10.31

Production of mined zinc has jumped 26.1% during 2014 H1, full year productionvolume is expected to be over 100,000t, making Zijinthe 3rd largest producer of mined zinc in the PRC.

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2014 H2 Management Measures

Accomplish Operation Targets

Establish Competitive Edge in

Environmental Protection & Safety

Propel Development Strategy of Internationalization,Upsizing and Securitization

Achieve strategic cost reduction

Ensure progress on major projects

Monitor market movement, hedge

against price volatility and boost

sales price and profitability

Enhance control on financial risk,

centralize financial management and

enlarge economic benefits

Committed to environmental

protection and safety

Optimize asset structure

Implement both M&A and Exploration

Reinforce marketization Mechanism

for talents

Thank you

new 2014 h1 results h1 result.pdf · 2014. 8. 25. · 13 财务业绩financial highlight disclaimer...

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