[PPT] - 1 INTERIM CONSOLIDATED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE PowerPoint Presentation

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INTERIM CONSOLIDATED RESULTS

FOR THE SIX MONTHS ENDED 30 JUNE 2018

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PRESENTED BY DANIE PRETORIUS, CEO ANDRE VAN DEVENTER, CFO

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AGENDA

Commodity

Business overview Who we are Operational overview Financial overview In Closing

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WHO WE ARE

Started in 1986,

listed on JSE in 2012

Design, manufacture,
perate and maintain

boring technology

Operations in 23 countries

in Africa, South America, Europe and Asia

Motivated by tailor-made

solutions, that in turn support our diversifjcation strategy

Trusted partner to

blue-chip and mid-size mining companies

A technology company that

challenges the status quo

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BUSINESS OVERVIEW

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TECHNOLOGY STRATEGY Client Challenges

Safety
Increased costs
Productivity

decline

Net present

value hurdles

Accessibility

to ore bodies

Innovative tailor made drilling solutions

Non-Blasting environment

Mobile Tunnel Borer
Blind Shaft Boring System
Horizontal Raise Boring
Automation/Autonomous drilling
Geotechnical

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REVENUE GEOGRAPHIC DIVERSIFICATION

Central and North America Africa Other Countries

11% 14%

2017 H1 2017 H2

11%

2018 H1

South America

45% 41%

2017 H1 2017 H2

42%

2018 H1

44% 45%

2017 H1 2017 H2

34%

2018 H1

0% 0%

2017 H1 2017 H2

13%

2018 H1

Current Operations New Operations

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REVENUE MINING ACTIVITY DIVERSIFICATION

Production Capital Exploration d ti

95%

Capital C

4%

1%

2017 H1

Production Capital Exploration d ti

94% 5%

1%

2018 H1

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REVENUE COMMODITY DIVERSIFICATION

79

23%

Cu

29Cu

Cu Cu Cu Cu Cu u Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu Cu u

35%

Copper

16%

Platinum

1%

14%

Gold Iron Ore

Diamonds

Silver / Lead / Zinc Other

Other r 4%

Commodity

4%

1%

2018 H1

79

37%

29

32%

Copper

fE fE fE f Fe

26Fe

F fE E f

26 6

9%

Platinum

78

4%

30

12%

Gold Iron Ore Diamonds Silver / Lead / Zinc Other

Other

Othe

r 4%

Commodity

d

2%

Chrome C 0%

2017 H1

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REVENUE BUSINESS SECTOR DIVERSIFICATION

Hydroelectricity

Mining Sector

Civil & Construction

94%

H d

5%

C

<1% Hydroelectricity

Mining Sector

Civil & Construction

99%

H d

<1%

C

0%

2018 H1 2017 H1

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OPERATIONAL REVIEW

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LOST TIME INJURY FREQUENCY RATE

1.0

0.5

0.0

1.5

2.0

2.5

3.0

LTIFR

2.31 1.62

2018 2017

Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 13

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FINANCIAL OVERVIEW

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HIGHLIGHTS FOR THE PERIOD

Revenue growth in USD terms
New geographies added in current reporting period
Improvement in cash conversion ratio
Suffjcient cash for growth opportunities
Healthy pipeline

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HEADLINE EARNINGS PER SHARE

HEPS (ZARc)

2018 H1 2017 H2 2017 H1 20 40 60 80 100 120 2017 H2

HEPS (USDc)

2018 H1 2017 H1 2017 H2 2 4 6 8 10 12

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PIPELINE (USD ‘ MILLION)

2018

Awarded Awaiting adjudication Enquiry received/ possible lead

2019 2020 2021

And Beyond

50 100 150 200

Total

101.9 61.9 61.0 133.4

2019 2020 2021

and Beyond

2018

358.2 Million

Total 2018 2019 2020 2021 and Beyond

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COMMITTED ORDERS (USD ‘ MILLION)

Coal

0.3

Diamonds

0.9 2.2

Copper

Cu

29Cu

Cu Cu Cu Cu Cu u Cu Cu Cu

10.3 0.4

2018 2019 2020

2021 and beyond

Total

61.4 11.6 0.3 41.1

2019 2020 2021

and Beyond

2018

114.4 Million

Total

Chrome

1.9

Cr

24Cr

Cr r Cr Cr Cr Cr Cr Cr

1.6

Hydroelectric

0.2

Gold

Au

79

Au Au Au Au Au Au u Au Au Au Au u A

12.8 8.1 2.9 0.3

Platinum

Pt

78

Pt Pt Pt Pt t Pt t Pt Pt Pt Pt Pt Pt Pt Pt P

1.0 0.3

Polymetallic

Polymetal

16.5 10.8 0.3

Platinum

0.1

C

Water

H

0.8

Lithium

0.2

Other

0.2

Zinc

7.0 13.1

30

4.9

47

Silver

0.8 0.7

Iron Ore

7.6 0.2

Nickel

Ni

28

0.9 3.8 3.7

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EARNINGS BEFORE INTEREST TAX DEPRECIATION AMORTISATION (USD ‘ MILLION)

EBITDA (USD’m)

2018 H1 6 8 10 12 14 16 18 2017 H2 2017 H2 2017 H1 2017 H1 2018 H1

Revenue (USD’m)

2018 H1 10 20 30 40 50 60 70 2017 H2 2017 H2 2017 H1 2017 H1 2018 H1 2

24.5%

2018 H1

16.5 15.9 15.1 67.4 60.5 60.9

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ARPOR SUMMARY PER ANNUM

2018H1 2017 2016 2015 2014 2013 2012 Total Raise bore rigs 128 107 105 98 94 88 88 Utilization % 68% 69% 73% 70% 75% 77% 71% ARPOR* (USD) 109 953 110 937 111 040 120 819 118 215 117 047 108 847 Total Slim rigs 34 34 33 48 45 74 64 Utilization % 69% 77% 55% 35% 54% 54% 51% ARPOR* (USD) 63 802 63 597 74 280 96 761 58 525 50 740 34 293

* Average Revenue Per Operating Rig per month

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PROFIT AFTER TAX (USD ‘ MILLION)

2018 H1 2 4 6 8 10 12 14 2017 H2 2017 H2 2017 H1 2017 H1 2018 H1

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STATEMENT OF FINANCIAL POSITION

2018H1 2017 Comment USD 'million USD 'million Assets Total non-current assets 143.8 133.2

Continued investment in plant and equipment - USD 7.1 million

Total current assets 96.3 103.7

Working capital ratio fairly fmat compared to 2017

Total assets 240.1 236.9 Equity Equity 152.1 153.0 Non-controlling interest 8.5 8.3 Total equity 160.6 161.3 Liabilities Total non-current liabilities 45.9 47.1

Gearing ratio moved from 2.4% to 10.9%

Total current liabilities 33.6 28.5

Current ratio healthy at 2.86

Total liabilities 79.5 75.6 Total equity and liabilities 240.1 236.9 22

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STATEMENT OF COMPREHENSIVE INCOME

2018H1 2017H1 2017 USD 'million USD 'million USD 'million Revenue 67.4 60.5 121.4 Cost of sales (43.5) (37.7) (76.8) Gross profjt 23.9 22.8 44.6 Other operating income 2.0 1.2 3.7 Other operating expenses (13.0) (11.9) (23.4) Operating profjt 12.9 12.1 24.9 Investment revenue 0.6 0.4 0.5 Finance costs (1.5) (1.0) (2.9) Share of profjt from equity accounted investment (0.0) (0.0) (0.0) Profjt before taxation 12.0 11.5 22.6 Taxation (2.3) (1.5) (5.1) Profjt for the year 9.7 10.0 17.5 Explanation\Comment Revenue Revenue increased slightly due to additional revenue from new subsidiary Cost of Sales Cost of sales increased in line with increased revenue - fairly fmat gross profjt percentage Profjt for the year Lower utilisation rates and currency effect of the

ther operating currencies

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IMPACT OF CURRENCY ON PROFIT BEFORE TAXATION

Costs Revenue

0% 20% 40% 60% 80% 100%

Costs

USD Other Operating Currencies

55% 45% 78% 22%

USD’ million Negative impact on profjt before taxation (1.14)

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2018H1 2017H1

Comment

USD 'million USD 'million Net cash from operating activities 8.7 9.2 Cash conversion ratio increased from 1.04 to 1.10 Net cash from investing activities (14.3) (6.3) Acquisition of Subsidiary Net cash from fjnancing activities (4.3) 14.0 Total cash movement for the period (9.9) 16.9 Cash at the beginning of the period 40.3 20.4 Effect of exchange rate movement on cash balances (2.0) 0.4 Total cash at the end of the period 28.4 37.7 Suffjcient cash for future growth opportunities

STATEMENT OF CASH FLOWS

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REVENUE WATERFALL BREAKDOWN (USD ‘ MILLION)

Revenue 2017 H1 60.5 Foreign exchange movements 1.7 Fleet expansion 6.1 Fleet mix & utilization (0.9) Revenue 2018 H1 67.4

(USD’m)

2017H1 Forex Fleet expansion Fleet mix & utilization 2018H1 20

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40 60 80 100 120 Fleet mix &

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WORKING CAPITAL BREAKDOWN (USD ‘ MILLION)

Working Capital Breakdown 2018H1 2017 Movement Inventory 24.5 23.9 (0.6) Trade and Other Receivables 43.2 38.2 (5.0) Trade and Other Payables 20.2 20.1 0.1 27

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BALANCE SHEET RATIOS

2018H1 2017H1 2017 Return on Capital Employed (EBITDA) 15.5% 14.7% 15.3% Working Capital Ratio (Days) 128.8 135.9 126.3 Gearing Ratio (Net of Cash) 10.9% 5.9% 2.4% 28

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CASH FLOW WATERFALL (USD ‘ MILLION)

2018H1 Cash at beginning of period 40.2 Cash from operation activities 8.7 Net acquisition of property, plant & equipment (4.9) Dividends paid (3.1) Issue of share capital (9.3) Acquisition of subsidiary (1.2) Other (2.8) Cash at end of period 28.4

(USD’m)

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5
10
15

10 15 20 25 30 35 40

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CAPITAL SPEND

Plant and Machinery 97% Motor Vehicles 2% IT Equipment 1% Expansion

95.7%

Sustainable

4.3%

2018H1

7.1 million

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IN CLOSING

Solid pipeline
Stable order book
Opportunities with technology
Mobile Tunnel Borer
Blind Shaft Boring System
94% of income from production

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This document has been compiled from information provided by the Directors of Master Drilling Group Limited (“Master Drilling”, “Master Drilling Group” or the “Company”) and from publicly available sources, and involves elements of subjective judgment and analysis, which may or may not be correct, and have not been independently verifjed. Accordingly, Master Drilling and its Advisors accept no responsibility for the correctness

r otherwise of the content set out herein and no representation or warranty, express or implied, is being made
r given as to the accuracy or completeness of the information set out herein. The information contained in this

document is subject to completion, revision, verifjcation and amendment without prior notice and without liability to compensate or reimburse any party. No representation or warranty, express or implied is, or will be, given by Master Drilling or its Directors, Partners, Employees or Advisors or any other person as to the accuracy, completeness or fairness of this document and, so far as permitted by law and except in the case of fraud by the party concerned, no responsibility or liability whatsoever is accepted for the accuracy or suffjciency thereof or for any errors, omissions or misstatements negligent or otherwise relating thereto. Master Drilling shall only be bound by those particular representations and warranties set forth in defjnitive written transaction documents, when and if such transaction documents are executed and subject to such restrictions and limitations as may be contained therein. This document may include certain statements, estimates, targets, forecasts and projections provided by Master Drilling. Such statements, estimates, targets, forecasts and projections refmect signifjcant assumptions and subjective judgments and analysis by Master Drilling’s management concerning anticipated future events which may or may not prove to be correct and there can be no assurance that any estimates, targets, forecasts or projections are attainable or will be realised. Nothing contained in this document is, or shall be relied upon as, a promise or representation, whether as to the past or the future. Accordingly, (subject as aforesaid) neither Master Drilling nor its Directors, Partners, Employees or Advisors nor any other person, shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying

n any statement in or omission from this document and any such liability is expressly disclaimed. In particular,

but without limitation, no representation or warranty is given as to the achievement or reasonableness of, and no reliance should be placed on, any estimates, targets, forecasts or projections contained in this document (or otherwise provided by or on behalf of Master Drilling with respect to the subject matter of this document). In all cases, interested parties should conduct their own investigation and analysis of Master Drilling and the information contained in this document before making any decisions. This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of an offer to purchase or subscribe for, any securities of the Company or any other entity, nor shall the information contained in this document or the fact of its distribution form the basis of, or be relied upon in connection with, or act as any inducement to enter into, any contract or investment decision in relation thereto. The document is not an offer of securities in the United States. The securities of the Company have not been and will not be registered under the US Securities Act of 1933, as amended (the “US Securities Act”), and may not be offered or sold in the United States absent registration under, or an exemption from the registration requirements of, the US Securities Act. The distribution

f this document may be restricted by law and persons into whose possession the Information comes should

inform themselves about and observe any relevant restrictions. This document is not intended to provide, and should not be relied upon for, or as, accounting, legal, tax advice or investment recommendations. You should consult your tax, legal, accounting or other professional advisors about the issues presented in the Information. This presentation and the documents provided with this presentation are confjdential and may not be disclosed to any third party without the prior written consent of Master Drilling.

DISCLAIMER

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CORPORATE INFORMATION

MASTER DRILLING GROUP LIMITED Registration number: 2011/008265/06 Incorporated in the Republic of South Africa JSE share code: MDI ISIN: ZAE000171948 REGISTERED AND CORPORATE OFFICE 4 Bosman Street PO Box 902 Fochville, 2515 South Africa DIRECTORS Executive Daniël (Danie) Coenraad Pretorius Chief executive offjcer and founder André Jean van Deventer Financial director and chief fjnancial offjcer Barend Jacobus (Koos) Jordaan Executive director Gareth (Gary) Robert Sheppard # Chief operating offjcer Non-executive Hendrik (Hennie) Roux van der Merwe Chairman and independent non-executive Akhter Alli Deshmukh Independent non-executive Andries Willem Brink Independent non-executive Octavia Matshidiso Matloa Independent non-executive Shane Trevor Ferguson Non-executive Fred George (Eddie) Dixon Alternate director

# Resident in Peru

COMPANY SECRETARY Andrew Beaven 6 Dwars Street Krugersdorp 1739 South Africa PO Box 158, Krugersdorp, 1740 South Africa JSE SPONSOR Investec Bank Limited (Registration number: 1969/004763/06) 100 Grayston Drive, Sandown Sandton, 2196 South Africa INDEPENDENT AUDITORS Grant Thornton Johannesburg Partnership South African member of Grant Thornton International Limited 52 Corlett Drive Illovo 2196 South Africa SHARE TRANSFER SECRETARIES Computershare Investor Services Proprietary Limited (Registration number: 2004/003647/07) Rosebank Towers, 15 Biermann Avenue, Rosebank, South Africa

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CORPORATE INFORMATION

INVESTOR RELATIONS CONTACTS Monica Ambrosi Instinctif Partners Telephone: +27 11 050 7506 Mobile: +27 83 307 8286 E-mail: MasterDrilling@instinctif.com GENERAL E-MAIL QUERIES info@masterdrilling.com Master Drilling website www.masterdrilling.com Company Secretarial E-mail Companysecretary@masterdrilling.com Master Drilling posts information that is important to investors on the main page of its website at www.masterdrilling.com and under the “investors” tab

n the main page. The information is updated regularly and investors should

visit the website to obtain important information about Master Drilling.

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