Click to edit Master title style · 2019. 6. 20. · TSX:KGI 10 klgold.com Q2/16 Financial Results...
Transcript of Click to edit Master title style · 2019. 6. 20. · TSX:KGI 10 klgold.com Q2/16 Financial Results...
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TSX:KGI 1 klgold.com
TSX:KGI
GROWTH VALUE
A Focused Gold
Producer
Q2 2016 Earnings Call and Webcast
August 5, 2016
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TSX:KGI 2 klgold.comTSX:KGI klgold.com2
Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements.
Statements made in the Company’s handouts and as part of the corporate presentation contain statements which
constitute ”forward-looking statements”, including statements regarding the plans, intentions, beliefs and current
expectations of the Company with respect to the future business activities and operating performance of the Company. The
words “may”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar
expressions, as they relate to the Company, are intended to identify such forward-looking statements. Forward-looking
statements used in this presentation include, but may not be limited to; statements regarding the Company’s
guidance metrics for 2016 including, gold production, head grade, cash operating costs, AISC, and capital
expenditures; the exploration programs and associated budgets with respect to the Kirkland Lake Camp and East
Timmins Assets and the results and timing thereof, the medium to long-term strategy and potential of the
Company to continue to grow by way of organic growth and/or through various strategic transactions, including
mergers and acquisitions; increased throughput at the Holt and Taylor mines, and Company’s ability to further
reduce costs through various efficiency projects across the operations and the timing thereof.
With respect to the forward-looking information of Kirkland Lake Gold, concerning gold resources and reserves of the Kirkland Lake properties and
the East Timmins properties, the development of such properties are subject to various key assumptions described in the Annual Information Forms
and Technical Reports of both Kirkland Lake Gold and St Andrew Goldfields Ltd. referred to herein and as filed on the SEDAR profiles of both
companies at www.sedar.com and on the Company’s website at www.klgold.com.
Investors are cautioned that forward-looking statements are based on the opinions, assumptions and estimates of management considered
reasonable at the date the statements are made such as, without limitation, opinion, assumptions and estimates of management regarding the
Company’s business, its ability to increase its production capacity and decrease its production cost. Such opinions, assumptions and estimates, are
inherently subject to a variety of risks and uncertainties and other known and unknown factors that could cause actual events or results to differ
materially from those projected in the forward-looking statements. These factors are discussed in length in the Company's annual Management's
Discussion and Analysis for the interim period ended June 30, 2016, and Annual Information Form for the year ended December 31, 2015 filed with
the securities regulatory authorities in certain provinces of Canada and available at www.sedar.com.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove
incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or
expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to
differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend,
and does not assume any obligation, to update these forward-looking statements except as otherwise required by applicable law.
http://www.sedar.com/http://www.klgold.com/http://www.sedar.com/
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TSX:KGI 3 klgold.com
2016 Second Quarter Earnings Call
For the 3 and 6 month period ending June 30, 2016 (Q2/16)
Non-GAAP Measures
• Average Realized Price Per Ounce of Gold Sold
• Cash Operating Cost Per Tonne
• Cash Operating Cost Per Ounce Sold
• All-in Sustaining Costs per Ounce Sold
• Free Cash Flow
Change in Year End
Changed from April 30th to a calendar year end as
of January 1, 2016.
Comparative period for reporting purposes:
Q2/16 is compared to Q1/SY15
(covers the three month period from May 1 to
July 31, 2015)
Conversion CalculationsShort Tons Metric Tonnes
Troy Ounce Grams per Tonne
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TSX:KGI 4 klgold.com
Management In Attendance
Anthony (Tony) Makuch President & CEO
Perry Ing, CPA-CA, CFA CFO
Chris Stewart, P.Eng VP Operations
Doug Cater, P.Geo VP Exploration
Suzette N Ramcharan, CPIR Director, Investor
Relations
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TSX:KGI 5 klgold.com
Q2 and H1 2016 Production Highlights
Q2/16Three months ended
June 30, 2016
H1/16Six months ended
June 30, 2016
Ounces Produced 68,338 130,613
Ounces Sold 72,144 141,153
Production derived from the Macassa Mine Complex, and the Holt-Holloway
and Taylor mines.
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TSX:KGI 6 klgold.com
Q2 and H1 2016 Financial Highlights
Q2/16Three months ended
June 30, 2016
H1/16Six months ended
June 30, 2016
Average Realized Price of Gold
Sold1 (US$/Oz)$1,271 $1,211
Operating Cost Per Ounce Sold1
(US$/Oz)$641 $667
AISC Per Ounce Sold1 (US$/Oz) $990 $925
Based on total production expenses of C$81.7M C$159.5M
Free Cash Flow1 C$31.9M C$57.3M
Based on cash flow from operations of C$53.0M C$96.7M
1 non-GAAP Measures
Average realized price per ounce sold of C$1,638 in Q2/16 and C$1,611 for H1/16
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TSX:KGI 7 klgold.com
Q2 and H1 2016 Highlights
Meet guidance
Improve productivity and lower costs
across all of the operations
Become more aggressive in our
exploration efforts
Our focus for the remainder of
2016 is to:
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TSX:KGI 8 klgold.com
Q2/16 Financial Results
COSTS
Operating Expenses C$62 M
Amortization & Depletion C$15 M
Royalty C$5 M
Total Production Expenses C$82 M
Operating Cost Per Tonne1 C$208/tonne
Operating Cost Per Ounce1US$667/Oz
AISC Per Ounce1 US$990/Oz
For the three month period ending June 30, 2016
1 non-GAAP Measures
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TSX:KGI 9 klgold.com
Q2/16 Financial Results
PROFITABILITY
Gross Profits C$36 M
G&A Expense C$6.4 M
Exploration Expense C$4.1 M
Finance Expense C$5.6 M
Net Income C$26.3 M
Earnings Per Share $0.12
Effective Tax Rate 37%
For the three month period ending June 30, 2016
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TSX:KGI 10 klgold.com
Q2/16 Financial Results
CASH FLOW
Free Cash Flow1 C$39.1 M
Cash Balance C$157.5 M
Flow-through Financing
(closed subsequent to quarter end)~C$15M
Cash Balance including Flow-through raise ~C$170M
For the three month period ending June 30, 2016
1 non-GAAP Measures
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TSX:KGI 11 klgold.com
Year-to-date Results Against Guidance
Guidance Guidance Metrics H1/16 Results
270 – 290 koz’sProduction (Ounces)
130.6 koz’s
7.7Grade (g/t)
8.2
US$600 – US$650Operating Cost 1
(Per Ounce Sold) US$667
C$120 MCapital Expenditures
(millions)C$35.5 M
US$1,000 – US$1,050AISC 1 (Per Ounce Sold)
US$925
1 non-GAAP Measures
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TSX:KGI 12 klgold.com
Highlights of Operational Performance
Q2/16(period ending June 30, 2016)
Q1/SY15(period ending July 31, 2015)
Cost per tonne (C$) $208/tonne $407/tonne
Cost per Ounce1 (US$/ Oz
Sold)US$ 641/Oz US$ 678/Oz
Capital Expenditures (C$) $21.0M $10.9M
AISC1 (US$/ Oz Sold) US$ 990/Oz US$ 956/Oz
ST2G battery powered Scooptram
1 non-GAAP Measures
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TSX:KGI 13 klgold.com
Macassa Mine Complex
Tonnes MilledGrade(g/t)
Ounces Produced
Cost/tonne
Macassa Mine Complex 89,436 13.8 38,215 -
Low Grade Stockpiles 13,616 1.8 714 -
TOTAL MACASSA PRODUCTION 103,052 12.2 38,929 C$302
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TSX:KGI 14 klgold.com
Holt-Holloway & Taylor Mines
Tonnes MilledGrade(g/t)
Ounces Produced
Cost/tonne
Holt 97,738 4.4 12,862 C$125
Holloway 40,295 4.1 4,826 C$174
Taylor 51,994 7.1 11,408 C$125
Taylor – Low Grade Stockpile 4,566 2.3 313 -
TOTAL PRODUCTION 194,052 5.0 29,409 C$135
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TSX:KGI 15 klgold.com
Long Section Views of Holt-Holloway and Taylor
150m
Surface
Bourgois ClaimShoot Zone
Bulk Sample
#1
1004 Lens
1006-1 Lens
1008-1 Lens
1008-2 Lens
100m
250m
350m 1006-2 Lens
500m
View looking north
OPEN
Underexplored Area
HOLT MINE
Production derived from Zone 4 and Zone 6
HOLLOWAY MINE
Production derived from Smoke Deep and
Blacktop
TAYLOR MINE
Production derived from
1004 East Lens
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TSX:KGI 16 klgold.com
2016 Production Guidance
Guidance of
270 – 290 kOzs
H1/16 Production
130,613 Ounces
The Company is on track to meet its production guidance for 2016
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TSX:KGI 17 klgold.com
Kirkland Lake Camp – Exploration Programs
Kirkland
Minerals
Underground Drilling (testing the SMC further to east and south and the ‘04 Break mineralization above the 3400’ Level)
Surface Drilling (testing the SMC extension along strike, the Main Break at depth and the Amalgamated Break)
SMC Drilling
’04 Break Drilling
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TSX:KGI 18 klgold.com
SMC Drill Results from 5300’ Level
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TSX:KGI 19 klgold.com
4250’ Level Drilling on the ‘04 Break Mineralization
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TSX:KGI 20 klgold.com
Holloway Property – Long Section
Deep ThunderZone
Lightning Zone
Canamax Zone
Smoke Zone
Holloway North 2016 Exploration target
Black Top Zone
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TSX:KGI 21 klgold.com
Taylor Property – Long Section
West Porphyry Zone (WPZ)
Indicated 248 koz
1.63M tonnes @ 4.7 g/t
Inferred 251 koz
1.86M tonnes @ 4.2 g/t
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TSX:KGI 22 klgold.com
Exploration Programs For Remainder of 2016
Kirkland Lake Camp
~ 68,000 metres of planned
drilling
~ 9 drills (6 on surface and 3 underground)
• SMC along strike
• Main Break at depth
• Amalgamated Break
Porcupine-Destor Fault Zone
~ 56,000 metres of planned
drilling
~ 5 drills (4 on surface and 1 underground)
• Holt-Holloway and Taylor
• Following up on other targets along the
120km land package
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TSX:KGI 23 klgold.com
A Mid-Tier Gold Producer
LEADERSHIP
PRODUCTION
PROFITABLE LOW COST
SUSTAINABLE, LONG TERM, PRODUCTION
ORGANIC GROWTH AND EXPLORATION
POTENTIAL
• 2016 targeted gold production 270-290k Ozs
• Cash costs
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TSX:KGI 24 klgold.com
www.klgold.com
Suzette N Ramcharan, CPIR
Director of Investor Relations
+1-647-361-0200
Mobile: +1-647-284-5315
TSX:KGI
mailto:[email protected]