The largest non state-owned and second largest coal ... · 3 Blackgold International Holdings...
Transcript of The largest non state-owned and second largest coal ... · 3 Blackgold International Holdings...
ASX: BGG
www.blackgoldglobal.net
Mines and Money Hong Kong Presentation
March 2013
The largest non state-owned and
second largest coal producer in
Chongqing, China by coal reserves
Blackgold International
Holdings Limited
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Important notice
This notice applies to this presentation and any information provided in relation to or in connection with the information contained in it.
All references to dollars, cents or $ in this presentation are to Australian currency, unless otherwise stated. References to “Blackgold” or “Company” are references to Blackgold International Holdings Limited or its applicable subsidiaries.
This presentation contains information in summary form and is for information purposes only. It has been prepared without taking into account the investment objectives, financial circumstances, taxation position or particular needs of investors. Some of the information is based on publicly available sources and information provided to the Company, has not been independently verified or may not be complete. It should be read in conjunction with the Company’s other continuous and periodic disclosure announcements lodged with Australian Securities Exchange, which are available at www.asx.com.au.
Forward-looking statements
This presentation contains forward-looking statements which involve a number of risks and uncertainties.
Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward looking statements. Such risks include, but are not limited to coal price volatility, currency fluctuations, production performance, increased production costs and variances in coal specifications or recovery rates from those assumed in mining plans, project delay or advancement, environmental risks, approvals and cost estimates, as well as political and operational risks, shipping risks and governmental regulation and judicial outcomes.
The Company does not undertake any obligation to release publicly any revisions to any forward looking statement to reflect events or circumstances after the date of this presentation or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.
Competent Person’s Statement
The information in this presentation that relates to Coal Reserves is based on information compiled by Tony Cameron, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy and a senior associate of Behre Dolbear Asia. Tony Cameron has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Tony Cameron consents to the reporting of this information in the form and context in which it appears.
The information in this presentation that relates to Coal Resources is based on information compiled by Dr. Tony Guo, a Competent Person who is a Registered Professional Geoscientist of the Professional Engineers and Geoscientists of the Province of British Columbia, Canada with the License #31257. He is a senior associate of Behre Dolbear Asia. He has extensive experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being under taken. He qualifies as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Dr. Guo consents to the reporting of this information in the form and context in which it appears.
Unless otherwise stated, all Mineral Resources figures reported represent estimates at January 2013. Rounding, conforming to the JORC Code, may cause some computational discrepancies.
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Blackgold International Holdings
Company Highlights
Largest non-state owned and second largest coal producer in Chongqing by coal reserves
Vertically integrated operations from coal mining and sourcing, transportation and storage to
sales and marketing
Own and operate four thermal coal mines with total JORC Compliant proved reserves of 65.3Mt
and probable reserves of 37.0Mt for a total of 102.3Mt1
Own logistics platform provided by private loading port, stockpile coal storage facilities, and our
own fleet of hollow-hull barges transporting coal on the Yangtze River
FY2012 total coal production of 1.2Mt, with 2.4Mt expected for FY2013
66.5% CAGR in NPAT from AUD14.5m in FY2010 to AUD40.2m in FY2012
Excellent safety track record – accredited Class 1 / 2 mines with zero fatal injuries or accidents
Well positioned as regional consolidator to capitalize on PRC coal industry consolidation
Listed on the ASX since February 2011, constituent stock of ASX All Ordinaries Index
Planning for dual primary listing in Hong Kong2
Notes:
1. Behre Dolbear Independent Technical Report, as announced on March 18, 2013
2. Subject to regulatory, shareholders approvals as well as market conditions
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FY2012 Financial Results
Continued growth momentum from production ramp-up
Summarized Financial Results (AUD ‘000) FY2012 FY2011 % Change
Total Coal Production (‘000 tonnes) 1,198 944 27%
Total Trading and Agent Commission Sales (‘000 tonnes) 958 384 149%
Revenue (AUD ‘000) 88,544 77,561 14%
EBITDA (AUD ‘000) 48,008 32,298 49%
NPAT (AUD ‘000) 40,234 22,872 76%
EPS (AUD cents) 4.52 2.75 64%
Cash Flow from Operations 35,748 30,444 17%
Financial Position FY2012 FY2011 % Change
Total Assets (AUD ‘000) 215,362 108,720 98%
Total Debt (AUD ‘000) 59,512 14,650 306%
Cash and Cash Equivalents (AUD ‘000) 26,563 11,746 126%
Net Debt (AUD ‘000) 32,949 2,904 NA
Gearing Ratio (%) 49% 18% NA
Total Equity (AUD ‘000) 120,508 79,839 51%
Note:
1. Financial year end at 31 October
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Investment Highlights
Experienced management team with proven execution track record
Vertically integrated operations covering entire coal supply value chain
Well positioned as coal sector consolidator in Chongqing region
Solid execution track record with significant production growth pipeline
Strategically located coal mines with logistical advantages and long mine lives 1
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Our Coal Mining Assets
Strategically located with logistical advantages and long mine lives
All four mines connected to the Yangtze River
system at short hauling distances to loading ports
Coal loaded onto barges and shipped to
customers by river on timely basis
Cost-efficient transportation of coal by river over
rail (60% less on a tonne per kilometer basis)
River barging not subject to capacity allocation
constraints faced by railway
Caotang Mine
Proved reserves 21.1Mt
Probable reserves 3.4Mt
Mine life 17.6 yrs
Distance to port 7 km
Baolong Mine
Proved reserves 29.8Mt
Probable reserves 26.4Mt
Mine life 32.7 yrs
Distance to port 0 km
Heiwan Mine
Proved reserves 2.2Mt
Probable reserves 0.5Mt
Mine life 5.2 yrs
Distance to port 23 km
Changhong Mine
Proved reserves 12.3Mt
Probable reserves 6.8Mt
Mine life 20.7 yrs
Distance to port 32 km
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Solid Execution Track Record
Significant growth through production ramp-up and acquisitions
2011: Acquired Baolong Mine (exploration license) and Changhong Mine (mining license)
2012: Completed technical upgrade at Changhong Mine and commenced trial production
2013: Changhong Mine commenced commercial production, Baolong Mine production expected in second half
2014E: Organic growth primarily driven by production ramp-up in Changhong and Baolong Mines
Historical and Projected Coal Production (Mt)
630 740 948
1,200 1,350 103 204
250
300 450
500
800 400
1,000
0
1,000
2,000
3,000
4,000
2010 2011 2012 2013E 2014E
Caotang Heiwan Changhong Baolong
733 944
1,198
2,400
3,600
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Vertically Integrated Operations
Covering the entire coal supply value chain
Coal sourced from self-production or third
party producers and traders
Own and operate fleet of nine hollow-hull
barges with load capacity of 40,000 tonnes
Private loading port and stockpile coal
storage facilities near our mines
Rights to use seven coal loading ports along
the Yangtze River
Our logistics reach extends from Sichuan
province to Shanghai covering a total of
2,800 km and eight provinces and directly
administered municipalities
Guaranteed and stable transportation
support for our coal products
Sales to end users directly at mine gate or
loading port, or blended coal sales through
our trading arm
Coal Production and
Sourcing
Transportation and
Storage Sales and Marketing
Stockpile Storage at Logistics Hub and Ports
Customers (Coal Traders
and End Users)
Coal Mining
(Self production)
Coal Sourcing (Third Party Coal Producers and Traders)
Transportation by Barges
Storage, Washing,
Blending and Loading onto
Barges
Mining Fees
(Subcontractors)
Ex-Mine Sales
(Sales at Mine Gate or Loading Port)
Coal Trading and
Blended Coal Sales
Caotang Mine
Heiwan Mine
Changhong Mine
Baolong Mine
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Well Positioned as Coal Sector Consolidator in Chongqing
Capitalize on government driven opportunities
Potential acquisition targets Current Blackgold mines
Baolong Mine
PRC government-driven coal sector consolidation
provides acquisition opportunities
National and local directives require smaller coal
mines to either cease production or be acquired by
larger groups
We are well positioned as regional consolidator
given our status as a listed company, safety track
record, and financial resources
Successfully made two coal mine acquisitions and
integrated into our group’s operations
Continue to focus on making acquisition of mines
situated close to the Yangtze River in the
Chongqing region
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Experienced Management Team
Proven track record and strong execution capabilities
PENG Yuguo James TONG OU Jun YAO Wenming ZHU Zongxiao LIM Teck Meng
Experienced
management
team
Founder, CEO
and Executive
Director
Chairman and
Non Executive
Director
Executive
Director Chief Geologist
Deputy General
Manager
Financial
Controller
12 years+ in coal
mining and sales
operations
management
12 years+ in
venture capital
investment
20 years+ in coal
mining, trading
and logistics
31 years+ in coal
exploration and
mining
operations
17 years+ in coal
mining and
trading
15 years+ in
accounting and
finance
20 Years of Industry Experience on Average
Proven
execution
track record
Extensive experience in coal production, coal trading, blended coal sales and logistics operations
Successfully completed acquisition and integration of coal mines in Chongqing
Delivered on production ramp-up
Significantly enhanced corporate governance and investor relations since IPO
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Our Growth Strategies
Acquire additional coal mines in the Chongqing region and further expand and upgrade existing mining operations to increase production capacity
Further investment to increase barging capacity, access to additional loading ports, and stockpile coal storage facilities for storage and blending
Increase investment in mechanization of production process to improve productivity and occupational safety
Plan to build a coal-washing facility at our logistics hub, and expand our logistics hub to handle higher coal throughput
To import coal into China using our import license and expand trading activities
Acquisitions and
capacity
expansion
Coal washing
facility and
expand logistics
hub
Enhance
productivity and
safety
Strengthen
logistics
operations
Strategic
relationship with
international
producers
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Appendix A
JORC Compliant Coal Reserves and Raw Coal Quality
Notes:
1. Independent Technical Review report by Behre Dolbear Asia, Inc., as announced on the ASX on 18 March 2013.
2. The Company noted there is a discrepancy in the amount of JORC compliant reserves estimated by Behre Dolbear with that indicated in the most recent estimates by Al Maynard & Associates Pty Ltd
(“AM&A”) as announced on 22 February 2013. For details regarding the discrepancy, please refer to the announcement dated 18 March 2013.
JORC Code Compliant Reserves as of 1 January 2013
Mine Proved
(Mt)
Probable
(Mt)
Total
(Mt)
Annual Design
Tonnage (Mt)
Estimated Mine Life
(years)
Caotang 21.1 3.4 24.5 1.5 17.6
Heiwan 2.2 0.5 2.6 0.6 5.2
Baolong 29.8 26.4 56.2 1.8 32.7
Changhong 12.3 6.8 19.0 0.9 20.7
Total 65.3 37.0 102.3 4.8
Average Undiluted Raw Coal Quality of the Reserves as of 1 January 2013
Mine Moisture
(%) ad
Ash
(%) ad
Volatile Matter
(%) ad
FC
(%) ad
Sulphur
(%) ad
CV (kcal/kg)
ar
Caotang 0.63 33.53 7.07 59.32 0.47 4,965
Heiwan 0.76 26.53 6.92 65.56 0.74 5,630
Baolong 0.58 28.39 6.87 62.39 0.57 5,494
Changhong 0.49 18.02 8.89 67.40 2.64 6,788
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Blackgold International Holdings Limited
12th floor, No.18,Mianhua Street, Yuzhong
District, Chongqing, 400011, PRC
James Chi Ho Tong, Chairman
Tel: +86 (23) 63778222
Fax: +86 (23) 63777154
Mobile: +86 13917552318
E-mail: [email protected]
ASX: BGG
www.blackgoldglobal.net
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