mineral resources limited - amazon s3 · • approval of exploration licenses on philippine iron...
TRANSCRIPT
![Page 1: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/1.jpg)
Page 1
MineralResourcesLimited
An integrated supplier of goods and services to the Resources Sector
2007 Interim Results
“A Successful First Six Months”February 22, 2007
Peter Wade, Managing DirectorBruce Goulds, Chief Financial Officer
![Page 2: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/2.jpg)
Page 2
Consolidated Group StructureConsolidated Group Structure
Mineral Resources LimitedACN 118 549 910
“An integrated supplier of goods and services to the Resource sector”
![Page 3: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/3.jpg)
Page 3
Board and ManagementBoard and Management
![Page 4: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/4.jpg)
Page 4
About Mineral Resources LimitedAbout Mineral Resources Limited
• Leading integrated mining services and processing company
• Formed through the consolidation of 3 associated, long established and successful operations
• PIHA – manufacturing and contracting business involved in construction of pipelines and site infrastructure formed in 1993
• CSI – successful contract crushing company with a build, own, operate business model formed in 1995
• PMI – minerals processing company operating in NW of WA and commencing in the Philippines formed in 1996
![Page 5: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/5.jpg)
Page 5
AgendaAgenda
11 HighlightsHighlights
2 Financial Results and Analysis
3 Operational Review
4 Outlook
![Page 6: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/6.jpg)
Page 6
Highlights Highlights -- OperationalOperational
• Full integration of three subsidiaries into ASX listed company
• Successful commissioning and operation of Nammuldi iron ore contract crushing plant
• Annual 280,000 tonne manganese sales contract formalised with CITIC
• Maintenance of world best practice HSE results
• Approval of exploration licenses on Philippine iron sands tenements
• Upgrade of polyethylene fittings manufacturing facility
![Page 7: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/7.jpg)
Page 7Nammuldi Iron Ore Operation
![Page 8: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/8.jpg)
Page 8
Highlights Highlights -- FinancialFinancial
• Strong earnings growth
• Interim normalised 6 month NPAT of $8.014 million – on target for annualised 17% increase over Prospectus forecast
• Debt to Equity ratio 17.7% with strong cash generation
• Interest cover 15 times
• Balance sheet strength to support growth targets
![Page 9: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/9.jpg)
Page 9
Highlights Highlights –– FinancialFinancial
16.8%6,8608,014NPAT8.3%17,27418,712EBITDA
20.7%60,34572,819Revenue
Variance
%
Prospectus half-year 2006/07
Actual half-year 2006/07
Comparison of Actual V Prospectus Forecast
The actual half year result is compared to 50% of the 2006/07 Prospectus forecast issued at the time of the Company’s listing
![Page 10: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/10.jpg)
Page 10
World Best Practice HSE World Best Practice HSE PerformancePerformance
0
4
8
12
16
20
Lost Time Injury Frequency Ratio
(LTIFR)
PMI CSI PIHA MineralResources
IndustryAverage
LTIFR = Number of Lost Time Injuries
Number of Hours Worked x 1,000,000
![Page 11: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/11.jpg)
Page 11
Australian Mineral ExportsAustralian Mineral Exports
Abare Australian Commodities December 2006
![Page 12: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/12.jpg)
Page 12
ChinaChina’’s Iron Ore Consumptions Iron Ore Consumptionand Importsand Imports
Abare Australian Commodities 13-4
![Page 13: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/13.jpg)
Page 13
World Zinc Price and StocksWorld Zinc Price and Stocks
Abare Australian Commodities 13-4
![Page 14: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/14.jpg)
Page 14
AgendaAgenda
1 Highlights
2 Financial Results and Analysis
3 Operational Review
4 Outlook
![Page 15: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/15.jpg)
Page 15
Financial PerformanceFinancial Performance
72.8Revenue
6.78EPS (cents) [half year]
25.7%EBITDA / Revenue
8.0NPAT
3.5Tax Expense
11.5PBT
0.8Interest
12.3EBIT
6.4Depreciation
18.7EBITDA
* 6 months to December ‘06
$AUD millions
*Results exclude share based payment expense of $0.692 million
![Page 16: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/16.jpg)
Page 16
Balance Sheet Strength to Facilitate Balance Sheet Strength to Facilitate GrowthGrowth
2.0Recommended fully franked dividend for record on 9 March ’07 and payable on 30 March ‘07
December 2006
17.7%Debt : Equity
1.2Actual special interim fully franked dividend (cents per share) paid Nov ‘06
15Interest Cover (times) [EBIT / Interest]
24.9%ROE % [NPAT (annualised) / Total Equity]
32.6%ROFE % [EBIT (annualised) / Funds Employed]
(1.4)75.877.2Funds Employed
(66.0%)22.1(11.4)(33.5)Net Debt (inc. cash balances)
47.1%20.664.343.7Net Assets
(4.5%)3.6(76.3)(79.9)Total Liabilities
13.8%17.0140.6123.6Total Assets
% Change$ ChangeDecember 2006June 2006$AUD millions
![Page 17: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/17.jpg)
Page 17
Strong Operational CashflowsStrong Operational Cashflows
19.6Total Increase in Cash
5.9Financing Cashflow
6 months to December ‘06
$AUD millions
13.7Net Operating and Investing Cashflow
(0.6)Working Capital and Other
(0.8)Net Interest Payments
(3.6)CAPEX (net)
18.7EBITDA
![Page 18: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/18.jpg)
Page 18
Revenue PerformanceRevenue Performance
0
20
40
60
80
100
120
140
$mill
ion
FY 2003 FY 2004 FY 2005 FY 2006 Prospectus2007
FY 2007Forecast
Actual Forecast
![Page 19: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/19.jpg)
Page 19
EBITDA PerformanceEBITDA Performance
0
5
10
1520
25
30
3540
$ m
illio
n
FY 2003 FY 2004 FY 2005 FY 2006 Prospectus
2007
FY 2007
Forecast
Actual Forecast
![Page 20: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/20.jpg)
Page 20
AgendaAgenda
1 Highlights
2 Financial Results and Analysis
3 Operational Review
4 Outlook
![Page 21: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/21.jpg)
Page 21
Business ModelBusiness ModelCore Business + Market Opportunities + Focus Areas = Success in Outcomes
•Safety recognition
•Increased
–NPAT–ROFE–EPS
•Reduced gearing
•Corporate Reputation
=
•HSE performance
•Margins and profitability
•Cost control
•Client relationships
•Risk management
•Quality staffing
•Shareholder support
+
•Contract crushing
•Mineral processing
•Infrastructure and mining sector service
•Acquisitions+
Integrated supplier of goods and services to the resources sector
![Page 22: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/22.jpg)
Page 22
Operational Review of Operational Review of Interim 6 month PerformanceInterim 6 month Performance
• Subsidiary businesses performing above forecast targets
• Successful consolidation of subsidiary companies into Mineral Resources Limited
• Margin improvements across services supply chain
• Business climate for resources and mineral processing continuing strong
• Strong growth in project pipeline
• Client relationships support corporate objective of ‘contractor of choice’ to the resources services sector
• Potential acquisition targets identified
![Page 23: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/23.jpg)
Page 23
Review of Contracting Services Review of Contracting Services OperationsOperations
• Strong 6 month project pipeline
• Market leader in niche contracting markets of pipelining, polyethylene fittings manufacture and mine site infrastructure and services installation
• Targeting longer term maintenance support contracts
• Significant short term pipeline and pipelining opportunities being negotiated
• Workshop facilities and construction fleet upgraded to meet anticipated demand requirements
![Page 24: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/24.jpg)
Page 24PIHA Workshop Bibra Lake
![Page 25: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/25.jpg)
Page 25PIHA Telfer Project
![Page 26: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/26.jpg)
Page 26PIHA Lining Contract Brunei
![Page 27: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/27.jpg)
Page 27PIHA Cable Laying
![Page 28: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/28.jpg)
Page 28
Review of Contract Crushing Review of Contract Crushing OperationsOperations
• All existing sites performing above client expectations for HSE and production targets
• Nammuldi iron ore operation achieving results in excess of 25% above target tonnage
• Confirmed focus on personnel safety and plant maintenance as key drivers for performance and reputation
• Cost management controls contributing to strong financial performance
• Priority focus by management on staff recruitment and training
• Upgrading of workshop facilities storage and layout to capture process improvements
![Page 29: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/29.jpg)
Page 29Nammuldi Iron Ore Operation
![Page 30: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/30.jpg)
Page 30Construction of Gold Crushing Plant
![Page 31: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/31.jpg)
Page 31CSI Workshop Kwinana
![Page 32: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/32.jpg)
Page 32
Review of Processing OperationsReview of Processing Operations
• Manganese processing plant Woodie Woodie upgraded to improve grade quality and increase plant production by 10%
• Focussed preliminary planning for development of iron sands project in Philippines
– Formalisation of exploration leases on 8 tenements (44,000 hectares)– Additional lease areas identified– Program for confirmation drilling under development– 500,000 tonne per annum pilot process plant to be established
• Negotiation of processing rights for reject non-ferrous mineral stockpiles commenced
![Page 33: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/33.jpg)
Page 33Woodie Woodie Manganese Operation
![Page 34: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/34.jpg)
Page 34Loading Manganese for Export, Port Hedland
![Page 35: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/35.jpg)
Page 35
AgendaAgenda
1 Highlights
2 Financial Results & Analysis
3 Operational Review
4 Outlook
![Page 36: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/36.jpg)
Page 36
Outlook Outlook -- MarketMarket• Continuing strong global demand for commodities
• ‘China story’ to remain expansive in the long term
• Brownfield and greenfield iron ore upgrades being fast tracked
• Cost pressures and supply side constraints promote outsourcing culture
• National infrastructure improvements and upgrades foreshadowed by Government – water, power, environment
• Significant junior mining company production activity planned
• Strengthening manganese prices
![Page 37: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/37.jpg)
Page 37
Average Annual Growth in Minerals Average Annual Growth in Minerals Consumption, 2005Consumption, 2005--1111
Abare Research Report 07.3
![Page 38: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/38.jpg)
Page 38
Outlook Outlook -- OperationalOperational
• Continuing focus on HSE quality performance to maintain world best practice
• Commencement of processing plant for iron sands in Philippines
• Formalisation of local opportunistic mineral processing contracts within Australia
• Achievement of increased tonnages from existing contract crushing opportunities
![Page 39: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/39.jpg)
Page 39
Outlook Outlook -- CorporateCorporate
• FY2007 results on target for NPAT in excess of $16 million (excluding share based payments)
• Balance sheet capable of supporting significant additional projects and acquisition initiatives
• Dividend payout ratio of 50% confirmed by Board as long term commitment
• Continuation of skills training and labour procurement strategies utilising local and overseas labour sources
![Page 40: Mineral Resources Limited - Amazon S3 · • Approval of exploration licenses on Philippine iron sands tenements • Upgrade of polyethylene fittings manufacturing facility. ... and](https://reader036.vdocument.in/reader036/viewer/2022062602/5e848ba85136e465454481d2/html5/thumbnails/40.jpg)
Page 40
Outlook Outlook –– Business StrategyBusiness Strategy
• Maintain core business focus
• Add value to clients and shareholders
• Develop high quality Board, management and operating team
• Grow business as measured by profitability, reputation and shareprice
• Acquisition of complementary, earnings accretive business operations
• Implement geographic and commodity diversification strategies