mmx novembro 2013 - ingles - vfinal
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MMX: CREATING CHOICES IN SEABORNE IRON
ORE SUPPLY
Rio de Janeiro | November 2013
This presentation relating to MMX Mineração e Metálicos S.A. (“MMX”) includes “forward-looking statements”, as that term is defined in the
Private Securities Litigation Reform Act of 1995, in Section 27A of the Securities Act of 1933 and Section 21E of the U.S. Securities
Exchange Act of 1934. All statements other than statements of historical facts are statements that could be deemed forward-looking
statements and are often characterized by the use of words such as “projects”, “expects”, “anticipates”, “intends”, “plans”, “believes”,
“estimates”, “may”, “will”, or “intends”, or by discussions or comments about our objectives, strategy, plans or intentions and results of
operations. Forward-looking statements include projections regarding our operating capacity, operating expenditures, capital expenditures
and start-up dates.
By their nature, these forward-looking statements involve numerous assumptions, uncertainties and opportunities, both general and
specific. The risk exists that these statements may not be fulfilled or, even if they are fulfilled, the results or developments described in
such statements may not be indicative of results or developments in future periods. We caution participants of this presentation not to
place undue reliance on these forward-looking statements as a number of factors could cause future results to differ materially from these
statements.
Forward-looking statements may be influenced in particular by factors such as the ability to obtain all required regulatory approvals on a
timely basis or at all, exploration for mineral resources and reserves, difficulty in converting geological resources into mineral reserves,
and changes in economic, political and regulatory conditions. We caution that the foregoing list is not exhaustive. When relying on
forward-looking statements to make decisions, investors should carefully consider these factors as well as other uncertainties and events.
MMX does not undertake to update our forward-looking statements unless required by law. This presentation is neither an offer to sell
(which can only be made pursuant to definitive offering documents) nor a solicitation of an offer to buy any securities in the United States,
or any other jurisdiction. The securities referred to herein have not been registered in any jurisdiction, and in particular, will not be
registered under the U.S. Securities Act of 1933, as amended, or any applicable state securities laws and may not be offered or sold in the
United States absent registration or an applicable exemption from such registration requirements.
This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part
without MMX’s prior written consent.
DISCLAIMER
MMX INTRODUCTION
1
MMXM3: SOLID CONTROLLING SHAREHOLDERS
Superporto Sudeste
MMX Corumbá Mineração MMX Sudeste
100% 100% 94,52%
5,48% EBX
4
Controlling Shareholders
59,3%
Wisco
10,5%
SK Networks
8,8%
Outros
21,4%
Serra Azul
Bom Sucesso
HIGH QUALITY MINING ASSETS IN TRADITIONAL
MINING DISTRICTS
5
Sudeste System Serra Azul Unit
Bom Sucesso Unit
Corumbá System
Sudeste Superport
Two operating systems: Serra Azul and Corumbá;
Current Capacity: approximately 7 Mtpy;
Mining rights in traditional iron ore districts: Brazil (Minas Gerais and Mato Grosso do Sul);
Production committed with strategic consumers – China and South Korea – through long-term contracts;
Brownfield start up in Brazil;
Expanding up to around 40 Mtpy in Brazil, under revision, through fully integrated systems: Private port;
Strategic port location.
INGREDIENTS FOR A SUCCESSFUL IRON ORE
BUSINESS
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Resource Base SRK and Coffey Mining certifications (Serra Azul, Pau de Vinho e Bom Sucesso): 3,6 billion tons of mineral resources. Reserves of 1 billion tons in Serra Azul.
Competitive Production Cost
Structure
Low stripping ratio Competitive scale – New beneficiation plant Energy supply contract with MPX Infrastructure with integrated logistics
Guaranteed Logistics
Sudeste Superport at 50 Mtpy, expandable to 100 Mtpy, provides gateway to seaborne markets Long Term Railway Contract with MRS
Secured Off-take
64% of future production already committed through long-term contracts
Operational Track Record
Experience management team with implementation and operational expertise Current Capacity of 8 Mtpy (Serra Azul and Corumbá sites)
Definitive agreements executed by the Company with Trafigura and Mubadala;
Sale of all shares in Minera MMX de Chile S.A. to Inversiones Cooper Mining S.A.
Hiring of financial advisors to evaluate business opportunities;
New certification of mineral resources (SRK and Coffey Mining) totaling 3.6 billion tons considering Serra Azul Unit, Mina Pau de Vinho and Bom Sucesso;
Conclusion of the contracting of supplementary long term funding for the Sudeste Superport with BNDES, in the sum of R$ 935 million;
Renewal of the lease contracts for mineral rights with the CEFAR, extending the terms of validity from 2021 to 2034;
Arrival of 2 Ship Loaders in the Sudeste Superport ;
Conclusion of the capital increase in the amount of R$ 1.4 billion;
BNDES approves eligibility for a long term financing for Serra Azul;
Conclusion of the offshore civil works at the Sudeste Superport;
Issuance of debentures at the amount of R$ 600 million;
November 2013
January 2012
A LOT HAS BEEN DELIVERED
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FINANCIAL HIGHLIGHTS
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204 237 284
0
50
100
150
200
250
300
2Q12 1Q13 2Q13
Net Revenue (R$ million)
113 140
186
0
50
100
150
200
2Q12 1Q13 2Q13
Gross Profit (R$ million)
7 3
41 3.6%
1.3%
14.6%
0%
4%
8%
12%
16%
0
10
20
30
40
50
2Q12 1Q13 2Q13
Adjusted EBITDA (R$ million)
Adjusted EBITDA
EBITDA Margin
SUDESTE SYSTEM
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SERRA AZUL UNIT
2.1
UNIQUE INTEGRATED LOGISTICS
Since Iron ore is a bulk commodity, an integrated logistic (mine railway port) is the key factor for a successful operation
Mine Superport Railway
Serra Azul unit is near to the MRS railway - 10 km from the mine, a distance currently traversed by trucks.
MMX has a long term contract with MRS railway, which connects the mine with the CSN’s port and the Sudeste Superport, both located in Itaguaí.
Sudeste Superport will have 50Mtpy iron ore shipping capacity. The Superport will have a depth of 20 meters, enough to handle Capesize vessels.
Offtakers (Shareholders)
Long-Term contract (20 years) to trade iron ore. SK will take-off part of the Sudeste System yearly production equivalent to its participation in MMX Capital (14%).
Long-Term contract (20 years). Wisco will off-take at least 50% of MMX Sudeste production.
SK and Wisco will together offtake 64% of total production
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QUADRILÁTERO FERRÍFERO Iron ore Quadrangle
RAILWAY
Railway access connecting MRS to the Sudeste Superport
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Contract signed on December 28th 2011;
Long term contract through 2026;
Provides for a volume of up to 36 million tons of iron ore per year.
MRS CONTRACT
MMX signed a long term contract for railway services
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SERRA AZUL
Expansion project with integrated logistic and pellet feed iron ore
Highlights
Production target: 29 Mtpy under revision;
64% of production already committed through long-term contracts;
997.4 million tons of reserves already secured by SRK.
Execution Update
Beginning of construction of Serra Azul Unit expansion;
Construction license issued in April, 2012;
Expected Quality – Ouro Preto pilot plant test work
Fe: 66,65% P: 0,025% AL2O3: 0,54%
SiO2: 3,23% Mn: 0,018% LOI: 0,75%
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SERRA AZUL
Growth through consolidation while leveraging existing infrastructure
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SERRA AZUL
Serra Azul Unit Expansion Project
New Beneficiation Plant, transmission line and water pipelines, Stockyard and Loading Terminal
Cava
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Serra Azul Expansion
Beneficiation Plant
Earthwork
SERRA AZUL
1 Pump House, Sump and Thickeners
2 Construction Site
1 1
3 Beneficiation
2
3
4 Grinding
4
5 Substation
6 Grinding
7 Piles
8 Primary Crusher
5 6
7
8
9 Primary Crusher
10 Water Storage Tank
11 Construction Site and Warehouse
12 Water Storage Tank Inc.
9 10
11
12
13 Main Access
14 Administrative Buildings
15 Maintenance Workshop
13 14
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SUDESTE SUPERPORT
2.2
Sudeste Superport
Location
Nautical Access
Offshore
Stockyard 32
Stockyard 06
Railway Access
Sudeste Superport
Artistic View
SUDESTE SUPERPORT
Overview
Licensed to 50 Mtpy, expandable to 100 Mtpy;
Licensing for 100 Mtpy underway, public;
Hearing held on May, 2012;
Navy Approval to 100 Mtpy;
Loading: 2 ship loaders of 25 Mtpy each;
Construction works for the tunnel and offshore infrastructure completed;
Fully funded (BNDES).
Definitive agreements executed with Trafigura and Mubadala to sell 65% of the Sudeste Superport
Sudeste Superport - Itaguaí
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USIMINAS AGREEMENT
SRK resources audit : 805 million tons;
Significant synergies with current mining operations at Serra Azul;
13.5% of production at Pau de Vinho will be delivered to Usiminas;
MMX will be responsible for the licensing, CAPEX and operation for 30 years.
Volumes:
■ 12 Mpta
80% Take-or-Pay;
Usiminas can renew the contract in 2016 for 1 to 5 years.
Pau de Vinho Joint Mining
Sudeste Superport Handling
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Sudeste Superport
Road&Railway Access
Sudeste Superport
Road&Railway Access
Sudeste Superport
Stockyard Elevation 6 m
Road Access
Car Dumpers
Car Dumpers Control Room
Stacker Reclaimer Infrastructure
Stockyard 32
Stockyard 6
Stacker Reclaimer Rolling Way
Sudeste Superport
Stockyard Elevation 6 m
Sudeste Superport
Car Dumpers
Train Positioners
Control Room of Car Dumpers
Sudeste Superport
Car Dumpers
Sudeste Superport
Stockyard Elevation 32 m 30
Sudeste Superport
Tunnel entrance
Electric Substation Infrastructure
Tunnel Entrance
Transfer House Structure
32
Sudeste Superport
Tunnel
33 33
Sudeste Superport
Tunnel Exit
34 34
Sudeste Superport
Offshore Structure
35
Sudeste Superport
Plataform and
Substation Structure
Electric Substation Building
Plataform
Superporto Sudeste
Estrutura Offshore
Bridge 270 m
Bridge 430 m
Pier 766 m
Sudeste Superport
Offshore Structure
37
Superporto Sudeste
Estrutura Offshore
37
Sudeste Superport
Ship Loaders
CORUMBÁ
3
CORUMBÁ
Highlights
Current Capacity: 2.1 Mtpy;
Long-term contracts signed with local and
international barge operators;
SRK audit resources report: 192 million
tons plus a potential of an additional 123
million tons.
39
Investor Relations | MMX
Carlos Gonzalez, CEO and IRO
Adriana Marques, Manager
Phone: + 55 21 2163-6197
+ 55 21 2163-6338
E-mail: [email protected]