Inca One Corporate Presentation
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Transcript of Inca One Corporate Presentation
Nov, 2011
- M A Y 2 0 1 4 -
TSX-V: IO
www.incaone.com
Disclaimer
This presentation includes forward-looking statements which are not historical facts but instead address future events and conditions
which by their very nature, involve inherent risks and uncertainties. Such information can generally be identified by the use of
forward-looking wording such as “may”, “expect”, “estimate”, “anticipate”, “intend”, “believe” and “continue” or the negative thereof or
similar variations. Forward-looking information in this presentation includes, but is not limited to, intended acquisitions, upgrades and
production at milling facilities, financing plans, use of proceeds and estimated net income. Actual results in each case could differ
materially from those currently anticipated in such statements due to factors such as: (i) fluctuation of mineral prices and exchange
rates; (ii) change in market conditions: (III) the fact that the Company has based many of its projections on information disclosed by
Dynacor Gold Mines Inc. (TSX:DNG, a company that the Company has in part based its business model on), and the Company’s
development and factors affecting it may be very different from those relevant to Dynacor, (iv) availability and quality of mill feed, (v)
regulatory and political developments and (vi) the Company has limited operating experience with its Chala Plant mill and future
operational results may not be accurately predicted based on this limited test milling information to date. Our forward-looking
information is based on the beliefs, expectations and opinions of management on the date the statements are made and we do not
assume any obligation to update forward-looking information, whether as a result of new information, future events or otherwise, other
than as required by applicable law.
Future-Oriented Financial Information
In addition this presentation contains future-oriented financial information (“FOFI”). The purpose of the FOFI is to provide prospective
investors with information pertaining to the Company’s longer term objectives. Readers should be cautioned that information may not
be appropriate for other purposes.
Currency
Unless otherwise indicated, all dollar values herein are in Canadian dollars.
.
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Directors & Advisory Board
Edward Kelly, BBA, President & CEO / Director
+20 years of management experience in sales, marketing and business development working in both private and public companies, +10 years working experience with Canadian public companies, Turn-around specialist who has rescued several private ventures, with corporate restructuring increasing sales by over 110% in 3 years, +3 years working in Peru.
George Moen, B.Com. Chief Operating Officer
Founder of Sandwich Tree & grew +100 locations across Canada, Former President of Blenz Coffee & grew the business to over 100 locations internationally, Co-Founder & serial entrepreneur of many successful businesses, including Rapid Time Networks, and High Output Business Networking.
Sharon Muzzin, CA, Chief Financial Officer
Ms. Muzzin has been a Senior Consultant of Malaspina Consultants Inc. since September 2005. She has over 25 years of experience providing management services to both private and public entities including several public companies in the mining industry. She is a Chartered Accountant.
Phu Van Bui, P.Geo.,Director
Mr. Bui is the principal geologist at Azalea GeoServices and a registered professional geoscientist with APEGBC. Since 2004, he has been engaged in base and precious-metal exploration and development projects in Alaska, Australia, Northern Canada, and Eastern Europe
George Young, Chief Metallurgist, Advisory Board
Metallurgist and a mining lawyer, with significant experience in mining development In Latin America. +35 years of experience in the industry, serving previously as VP and Director of International Royalty Corp., President of MAG Silver Corp, General Counsel Bond International Gold.
Paul Matysek, M.Sc. P.Geo, Advisory Board
Former President & CEO of Potash One where he successfully transacted the company for $454M to K+S Canada. Founder & CEO of Energy Metals Corp., where he helped grow from a market cap of $10M to its acquisition for $1.8BExecutive capacity for several exploration & development companies including First Quantum Minerals, First Majestic, Energy Metals & Lithium One.
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Other Directors
Gunther Roehlig, Director
Oliver Foeste, Director
Thomas Henricksen, Director & Chief
Geologist Peru
Robert McMorran, Director
James L. Harris, LLB, Corp Secretary
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Mission Statement
To establish ourselves as a brand by providing superior service to the
small scale gold mining sector, by strengthening business relations
with all stake holders.
Our Vision is to become the leader in the custom processor of gold ore
in Peru, through acquiring, upgrading, and increasing production at
existing milling facilities thereby providing attractive returns on capital
to investors and excellent opportunity for share price growth.
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Short Term Objectives
TSX-V: IO
- Secure mill feed and upgrade Chala Plant mill to 100 TPD
- Establish US$9.8 million/year initial net cash flow rate at 100 TPD
- Ramp up production to 100 TPD in calendar 2014
- Sign a LOI on one additional existing mill in a strategic location in Peru
- Strengthen management team in Peru
- Solidify key relationships for gold material supply with small scale mining community leaders
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Long Term Objectives
- Raise $15M in equity/debt financing to increase capacity at Chala Plant and
Future Plants 2 & 3 to 100TPD, as well secure mill feed taking company wide
operations to 300TPD
- Continue the growth profile by acquiring & upgrading 4 producing toll
milling facilities within 5 years and increase production to over 1000 TPD
- Eventually, with increasing milling capacity, become the small-scale miner’s
company of choice for legal, environmental, and technical guidance for
partnerships and guaranteed gold ore supply to the company
- Become the “processor of choice” by offering long lasting and reliable
relationships, superior service and conditions which emulate North American
standards
- Become the “investment of choice” for Peruvian pension funds
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Share Structure
As of May 20th, 2014
Issued & Outstanding 63.5 M
Warrants 13.0 M
Options 3.9 M
Fully Diluted 80.4 M
Cash $ 5.0 M
Marketable Securities $ 1.3 M
Market Cap $10.5 M
52 Week Range $0.065 - $0.175
Ownership- Management 17.5%
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The Business Opportunity
Peru Formalization
- Government of Peru was losing tax and royalty revenues from small mines exporting
“under the radar screen”
- Recently instituted “formalization” process requires all mines to process materials
through a recognized permitted mill facility. Inca One has identified mills to acquire
whose owners cannot navigate the permitting process
- Many “small miners” have been identified and have applied for “formalization”, and
will need to ship their materials to an approved mill, presenting an outstanding
opportunity for Inca One’s shareholders
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Strategic Locations for Mill Acquisitions
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**Internal Numbers
Provided by Ministry of
Energy and Mines of
Peru**
Region Number of Mines
1. Arequipa 13,709
2. Ayacucho 7,969
3. Puno 6,130
4. Apurimac 5,846
5. La Libertad 5,203
6. Piura 2,128
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5
1
2 4
3
Top 6 Regions For Mines
Applying for Formalization
- Toll milling of high grade gold material is quite lucrative.
- Many sub-standard mills are in place that are in need of
upgrading, a task usually best suited to expatriates, and which
otherwise represent a low capital investment relative to the
upside from the cash flow.
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New
Government
Formalizes &
Regulates the
Artisanal Mining
Sector
New Mining Laws
in Force Since
April 2012
Improves
Working
Conditions
Environmental
Protection
Increases
Government Tax
Revenues.
Reported $500
Million
Increased
Demand for
Legally
Compliant
Processing
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A Window of OpportunityNew Mining Policy
Presents Opportunity
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- Newly acquired processing plant
- Current operating capacity is 25 TPD,
- Upgrades underway to improve processing efficiency and to increase capacity to
50 TPD; can be permitted for up to 350 TPD
- 620km south of Lima, Peru in the mining intensive region of Chala
- Provides capacity for immediate cash flow & growth, irrespective of gold
prices. 42 acres of land provides ample opportunity for growth
Chala Processing Plant
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Chala Plant Metallurgy
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- Mill feed is “easy and clean”
- Simple crushing, coarse grinding, vat leaching and CIL
processing produces ~90-92% recovery and allows flexible
scheduling options
- Any high grade tailings can be stored separately in the tailings
pond for later re-processing for Inca One’s account
At present, Inca One will be producing a loaded
activated carbon. However, Inca One is currently
reviewing the cost-benefit of producing and selling
Dore.
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Chala Plant Mill Feed
- Local and regional small miners consistently produce material grading in excess of 1 ounce of gold per tonne
- Processing terms are expected to provide Inca One a minimum $265/tonne of gross margin per tonne processed at the mill when ore grades average 0.8 ounces per tonne
- Inca One intends to become the “processor of choice” by offering superior service and conditions which emulate to North American standards
- Reduce payment to mill feed suppliers from 20 days to within hours with onsite and expanded professional testing procedures of mill feed
- Offer additional services such as technical (geology) and legal (formalization process) in return for off take contracts
- Help increase their production through modern mining methods creating increased production
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Chala Plant Performance Model
$-
$0.25
$0.50
$0.75
$1.00
$1.25
$1.50
$1.75
50 tpd 100 tpd 200 tpd 350 tpd
$0.22*
$0.44*
$0.87*
$1.53*
Sh
are
Pri
ce
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Projection based on publicly disclosed information from a Peruvian gold
milling company:
- $265 Gross Margin per tonne processed
- $814 Market Cap per tonne milled **
$97M MKT CAP
$55M MKT CAP
$28M MKT CAP
$14M MKT CAP
*Based on existing number of shares outstanding
** Extrapolated from September 30th, 2013 year to date results
*** These measures may not be comparable with those of other toll milling corporations
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Projected Net Income Per Year
$-
$50
$100
$150
$200
$250
$300
$0
$10
$20
$30
$40
$50
$60
$70
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Mil
lio
ns
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Based on publicly disclosed information from a Peruvian gold milling company including a
gross margin of $265/tonne processed and market cap of $814/tonne milled *
81 TPD 275 TPD 475 TPD 675 TPD 888 TPD 1,000 TPDTOTAL
*Based on existing share structure
**These measures may not be comparable with those of other toll milling corporations
Projected Net Income (Before depreciation and interest) Market
Cap(Million)
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We Peru
- World’s 6th largest producer of
gold
- World’s 2nd largest producer of
silver
- World’s 3rd largest producer of
copper and zinc
- Mining provides 64% of the
nation's exports
- US$53B investment expected
over the next decade
- Only country in South America
serious about formalizing small
scale mining sector
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Ideal Framework
Mining companies may legally
continue to work for up to 2 years,
while they perform the necessary
studies and paperwork to be
granted a Small Miners Permit for
up to 350 tons per day.
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Contact
Head Office
1125 - 595 Howe Street
Vancouver, British Columbia
Canada, V6C 2T5
Tel: (604) 568-4877
Fax: (604) 569-1604
Peru Office
Dos de Mayo 516 Office 308
Miraflores, Lima 18 - Peru
Tel: (+51) 1 221 9849
Investor Relations
Kin Communications
Suite 100-736 Granville St.
Vancouver, British Columbia
Canada V6Z 1G3
Tel: (604) 684-6730
TF: 1-866-684-6730