An Australian Mid Cap Global gold miner Growing Against the Tide - - PowerPoint PPT Presentation

An Australian Mid Cap Global gold miner – Growing Against the Tide

Annual General Meeting - November 2018

ASX Listing Rule 5.23 Disclosures, foreign estimates, foreign exchange conversion and forward looking statements

ASX Listing Rule 5.23 Disclosures The Mineral Resources information in this report is extracted from the report entitled “Pogo JORC Resource” dated 16 October 2018 available at www.nsrltd.com and www.asx.com. Northern Star confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of Mineral Resources or Ore Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. Northern Star confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement. The information on Mineral Resources other than Pogo in this report is extracted from the report entitled ‘"Reserve & Resource Update and Corporate Outlook’ dated 2 August 2018 and is available to view on Northern Star Resources Limited’s website (https://www.nsrltd.com/) and the ASX (www.asx.com.au). Northern Star confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of estimates of Mineral Resources or Ore Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. Northern Star confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement. Limitation on information relating to the Pogo mine reserves, and SMM Pogo and SC Pogo All information in this presentation in relation to SMM Pogo and SC Pogo, and the Pogo mine – except resources but including historical production, mineral reserves, historic costs and other historical financial information and life of mine plans – has been sourced from Sumitomo Metal Mining Co., Ltd. and Sumitomo Corporation (together, "Sumitomo"), and their related bodies corporate (including SMM Pogo and SC Pogo). Additionally, all FY2019 guidance in relation to the Pogo mine in this presentation has been based on this information. Northern Star has conducted legal due diligence in relation to the Transaction, but has not independently verified all such information, and no representation or warranty, express or implied, is made as to its fairness, accuracy, correctness, completeness or adequacy of any information relating to the Pogo mine or SMM Pogo and SC Pogo. Neither Sumitomo nor SMM Pogo and SC Pogo have prepared this presentation, nor have Sumitomo or SMM Pogo and SC Pogo authorised its release. Foreign Estimate Note and Cautionary Statement - mineral reserves for the Pogo mine The information in this presentation that relates to the mineral reserves of the Pogo mine has been extracted from the ASX announcement titled “Northern Star Acquires Pogo Gold Mine in Alaska” released to ASX on 30 August 2018. A copy of this announcement is available at https://www.nsrltd.com/investor-media/news/ or www.asx.com.au. Such information was originally extracted from SMM Pogo’s internal report entitled "End-of-Year 2017 Resource and Reserve Report" dated 29 March 2018, which sets out the mineral resources and mineral reserves of the Pogo mine as at 31 December 2017. The mineral reserves estimates for the Pogo mine in this report have been prepared using the Canadian NI 43-101 Standards, but such estimates are not fully compliant with those standards. Accordingly, the mineral reserves estimates for the Pogo mine are not, and do not purport to be, compliant with the JORC Code and are therefore classified as "foreign estimates" under the ASX Listing Rules. A Competent Person under the JORC Code has not yet done sufficient work to classify such foreign estimates as Ore Reserves in accordance with the JORC Code, however Northern Star notes the similarity of the Canadian NI 43-101 Standards and the JORC Code. It is uncertain that following evaluation and/or further possible exploration work that these foreign estimates will be able to be reported as Ore Reserves in accordance with the JORC Code. For details as to the reliability of the mineral reserve estimates for the Pogo mine included in this presentation and the other information required to be included pursuant to ASX Listing Rule 5.12 in respect of those estimates, refer to the ASX announcement titled “Northern Star Acquires Pogo Gold Mine in Alaska” released to ASX on 30 August 2018. Forward looking statements Northern Star Resources Limited has prepared this announcement based on information available to it. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this announcement. To the maximum extent permitted by law, none of Northern Star Resources Limited, its directors, employees or agents, advisers, nor any other person accepts any liability, including, without limitation, any liability arising from fault or negligence on the part of any of them or any other person, for any loss arising from the use of this announcement or its contents or otherwise arising in connection with it. This announcement is not an offer, invitation, solicitation or other recommendation with respect to the subscription for, purchase or sale of any security, and neither this announcement nor anything in it shall form the basis of any contract or commitment whatsoever. This announcement may contain forward looking statements that are subject to risk factors associated with gold exploration, mining and production businesses. It is believed that the expectations reflected in these statements are reasonable but they may be affected by a variety of variables and changes in underlying assumptions which could cause actual results or trends to differ materially, including but not limited to price fluctuations, actual demand, currency fluctuations, drilling and production results, Reserve estimations, loss of market, industry competition, environmental risks, physical risks, legislative, fiscal and regulatory changes, economic and financial market conditions in various countries and regions, political risks, project delay or advancement, approvals and cost estimates. Effect of rounding A number of figures, amounts, percentages, estimates, calculations of value and fractions in this presentation are subject to the effect of rounding. Accordingly, the actual calculation of these figures may differ from the figures set out in this presentation.

* Currency conversions have been converted at a currency of AUD/USD conversion rate of A$0.75

2

Paulsens

3Moz Gold Camp

Tanami Project

+5Moz Gold Camp

Jundee

10Moz Gold Camp

Kalgoorlie Operations

19Moz Gold Camp

USA (Alaska) Pogo Mine (100%)

+8Moz Gold Camp

AUSTRALIA

ASX 100, top 25 global gold producer with mines in Western Australia and North America; 850koz- 900koz per annum at an AISC of A$1,050/oz – A$1,150/oz (US$787- US$862/oz)* Market cap is A$5.2B, with a sector-leading balance sheet; A$277M cash & equivalents and no debt NST’s manages a simplified business with a strong growth outlook; production set to grow to 875kozpa† in FY2019 with 3 Tier-1 assets in Tier-1 locations Track record of fully-franked dividends since 2012 with a stated dividend policy of paying out 6% of revenue Governed by the adage “a business first and a mining company second”

Introduction – An Australian listed gold miner with global scale

† Midpoint of FY2019 Guidance

3

FY2018 – Key Highlights

Record Net Profit*

• f A$194M

3

Financial Performance

4

Operational Performance Enviroment & Social

Group EBITDA* A$443M up 4% on pcp EPS* of 32.1¢ up 2% on pcp Full year dividend up 11%. Taking total payments to 9.5¢ per share Jundee & Kalgoorlie Ops both achieved 300kozpa run rate Record production run rate of 184koz achieved in 4Q18 Reserves increased to 4Moz and Resources to 15.9Moz † Acquisition and integration of the South Kalgoorlie Operations A$865M contribution into the Australian Economy 50% reduction in LTIFR to 0.9 vs sector avg of 2.7 19% Female participation, well above industry average Expanded our Indigenous Ranger program across all

• perations

* From continuing operations †Refer to Listing Rule 5.23 Disclosure on page 2

FY2018 - Strong operational performance

NST has organically grown production and EBITDA at its world class operations in FY2018 Gold Sold at both the Jundee and Kalgoorlie Operations combined increased by 21% Combined EBITDA increased by 15% to A$486M FY2018 gold sold 570,110oz at an AISC of A$1,029/oz (US$771/oz*)(1) Jundee operations: 284,745oz sold at AISC of A$870/oz (US$652/oz*)(1) Kalgoorlie operations: 261,589oz sold at AISC of A$1,174/oz (US$880/oz*)(1)

(1) This information is extracted from the ASX announcement on 18 July 2018 June Quarterly Activities Report and is available to view at www.nsrltd.com. or www.asx.com.au

Up 21% Up 15% Up 9%

5

Organic growth - the key to our superior returns

NST has been able to consistently grow production, resource and reserve life on a per share basis for its Shareholders since 2010 and has been our key focus for the past 4 years FY2018 Reserves increased to 4Moz and Resources to 20.5Moz with further Reserve growth potential in FY2019 with an increase in Measured and Indicated Resources to 11.7Moz in the latest statement(1) June 2018 Quarter production delivered +600kozpa run-rate six months early to schedule(2)

6

(1) Includes Resources from the recently announced Pogo Gold Mine Transaction; refer to Listing Rule 5.23 Disclosure on page 2 (2) Refer to 18 July 2018 ASX announcement

0.94 Mozs 1.4 Mozs 2.2 Mozs 6.2 Mozs 8.9 Mozs 9.2 Mozs 10.2 Mozs 15.9 Mozs 20.5Mozs 45 1.2 Mozs 1.5 Mozs 2Moz 3.5 Mozs 4 Mozs 4 Mozs 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 10,000 15,000 20,000 25,000

MY 10 MY 11 MY 12 MY 13 MY 14 MY 15 MY 16 MY 17 MY 18 Pogo Addition '000 Ounces

'000 Ounces

NST Resource and Reserve Growth

Measured Indicated Inferred Reserves

$10 $444 $5,240 ($280) 1,000 2,000 3,000 4,000 5,000 6,000 Starting Market Cap (30/6/10) Equity Issued Dividend Paid Current Market Cap 14/11/18 A$M

Organic and Inorganic growth - delivering returns to Shareholders

This strategy of balancing organic growth with well executed M+A has generated over A$5B of value for Shareholders since NST’s first acquisition in 2010 and <10% of this value uplift has been from equity raised NST has achieved this through operational excellence, investing heavily into exploration, growing production, cutting costs, technically/financially disciplined M+A and returning substantial dividends to Shareholders

7

A$5B of value added through executing

• rganic and inorganic growth strategies

$1,306 $4,389 ($186) $60 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 Starting Market Cap (30/6/15) Dividend Paid/Declared Equity Issued Market Cap 30/06/18 A$M

8

A$3.2B of value added through executing

• rganic and inorganic growth strategies

For the past 3 financial years the team at Northern Star have generated over A$3.2B of value for Shareholders, delivered a Total Shareholder Return of 242%, Average Return on Equity of 35% pa, Average Return on Invested Capital of 31% pa and fully franked dividends increased by 133% NST has also increased its Reserve base by 166% and Resource base by 79% over this period

Past three financial year value proposition - delivering returns

Northern Star acquired the high grade Pogo Underground Gold Mine (“Pogo”), located in Alaska, USA, for ~A$3472 million during the Sep-2018 quarter Acquisition immediately transforms Northern Star into a ~900kozpa global gold producer with three Tier-1 assets all in Tier-1 jurisdictions (Australia, USA and Canada) Strongly aligns to Northern Star’s stated and consistent acquisition criteria Pogo is a world-class 8Moz gold endowment3 that has produced approximately 3.8Moz at an average grade of 13.6gpt over the past 12 years at an average of ~300,000ozpa Pogo has a JORC Resource of 4.15Moz5 at 14.7gpt and a reserve of 760,000oz at 11.9gpt4 (the third highest reserve grade in North America), equating to an acquisition price of US$63/oz5 Pogo adds 250,000-260,000oz to FY2019 production at an AISC of US$880/oz (~A$1,175/oz*) and lifts group gold production to 850,000-900,000oz at an AISC of A$1,050-1,150/oz (US$787-862/oz*)1, making Northern Star the second largest gold producer listed on the ASX Pogo has several parallels to Jundee when it was acquired in 2014, providing opportunity to leverage the Company’s underground expertise to optimise the mine and target life extensions Transaction closed on 28 September 2018, however financial benefit of the asset was from 1 July 2018 Transaction funded from existing cash and proceeds of a completed A$175 million placement Immediately accretive to Northern Star on a range of key metrics

Pogo Gold Mine - Transaction Summary and Benefits

9

Pogo Site Layout Pogo Mine Design

1.Refer to ASX announcement titled “Pogo JORC Resource” dated 16 October 2018 available at www.nsrltd.com & www.asx.com; 2. Purchase price of A$347 million calculated using an AUD:USD exchange rate

• f 0.75. 3. Calculated on the basis of Pogo's current resources and reserves and past production. 4. Refer to Foreign Estimate Footnote on page 2. 5. Calculated on the basis of Pogo JORC 2012 Resource;

refer to 16 October 2018 ASX announcement and Listing Rule 5.23 disclosure on page 2..

2.8 g/t 3.4 g/t NST Post Transaction +20% 15.9Moz 20.0Moz NST Post Transaction +26% 3.8 g/t 4.1 g/t NST Post Transaction 4.0Moz 4.8Moz NST Post Transaction

Proforma Transaction Impact on Northern Star

10

Accretive to Northern Star’s group production, reserves, resources and gold grades

Reserves (Moz)(1) Reserve Grade (Au g/t)(1) Resources (Moz)(1) Resource Grade (Au g/t)(1) FY19 Gold Production (koz)(2) FY19 AISC (A$)(2) Cash Balance (A$) EV / EBITDA (x)(3)

1. Refer to Cautionary Statements on page 3. 2. Post transaction represents the mid-point of FY2019 guidance for NST per 30 August 2018 ASX announcement at www.nsrltd.com. 3. Based on NST FY2018A EBITDA and Pogo CY2017A EBITDA

+19% +7% +41% +2%

• 41%

620koz 875koz NST Post Transaction

Lower multiple = accretion for NST Shareholders

8.7x 2.2x Northern Star Multiple Implied Pogo Transaction Multiple 443M 263M NST Post Transaction 1,075/oz 1,100/oz NST Post Transaction

Australia 7 USA 5 Canada 5 Ghana 3 South Africa 2 Russia 3 Mexico 2 Argentina 3 Tanzania 2 PNG 2 Mali 1 Peru 2 Suriname 2 Burkina Faso 1 Brazil 2 Dominican 1 DRC 1

1 2 3 4 5 6 7 8 9 10 20 30 40 50 60 70 80 90 100 Number of +300kozpa mines (bubble size = combined production) Fraser Institute Index (Overall Investment Attractiveness)

Consistent with strategy: Tier-1 assets, Tier-1 locations

Globally there are only 17 mines producing over 300kozpa in Tier-1 mining jurisdictions (Australia, US and Canada); production is declining in these regions due to a lack of discoveries and significant reserve depletion NST has two mines that will shortly join that list of assets that produce at this rate; Jundee and Kalgoorlie Pogo has the potential to be a third +300kozpa producing asset in the Northern Star portfolio that operates within a Tier-1 jurisdiction

Tier-1 mining jurisdictions

Source: Investec, SNL

Jundee Operations Kalgoorlie Operations Pogo Gold Mine

11

Pogo operating and financial performance – past 5 years

12

Gold Production (koz) and AISC (US$/oz) Recoveries (% Au)

An established history of consistent high grade gold production at a competitive AISC

Throughput (kt) and Grade (Au g/t)* Operating Cost Breakdown (US$/oz) Capital Expenditure (US$M) Pre-Tax Free Cash Flow (US$M)

337 342 281 269 271 718 764 870 849 882 100 200 300 400 500 600 700 800 900 1000 50 100 150 200 250 300 350 400 2013 2014 2015 2016 2017 AISC (US$/oz) Production (koz) 90.2% 89.0% 87.7% 86.1% 88.1% 2013 2014 2015 2016 2017 217 143 54 97 102 2013 2014 2015 2016 2017 16 28 16 9 15 32 22 34 11 17 48 50 50 20 32 2013 2014 2015 2016 2017 Sustaining Capital Non-Sustaining Capital

Source: Pogo management reports

626 620 737 758 771 2013 2014 2015 2016 2017 Mining Milling Maintenance Admin 863 877 841 854 884 13.5 13.6 11.9 11.3 10.8 2 4 6 8 10 12 14 16 100 200 300 400 500 600 700 800 900 1,000 2013 2014 2015 2016 2017 Grade (g/t Au) Throughput (kt) * All graphs are presented in standard metric units (g/t, tonnes) unless otherwise stated.

Pogo is in the World-Class Tintina Mineral Belt

Pogo provides Northern Star exposure to a prolific gold mineral belt with a long history of gold production The Tintina Mineral Belt stretches across much of interior Alaska, through the southwestern Yukon The region hosts significant gold deposits as well as copper, lead, zinc, silver and tungsten deposits Over 50Moz of gold mineralisation has been defined in the region in the past 20 years alone

13

Note: Project data on map represents resource endowment1, sourced from company disclosures.

Tonnes Grade Ounces

(‘000) (g/t) (‘000)

Proven 1,046 13.0 439 Probable 944 10.6 322 TOTAL 1,990 11.9 760 Tonnes Grade Ounces

(‘000) (g/t) (‘000)

Indicated 3,316 15.7 1,674 Inferred 5,477 14.1 2,476 TOTAL 8,763 14.7 4,150

MINERAL RESERVES

at 31 December 20171

MINERAL RESOURCES

at 30 June 20181

Mineral Resources have now been re-estimated and stated under JORC 2012 guidelines

1) Numbers may vary due to rounding; refer to Listing Rule 5.23 disclosures (Resources) and foreign estimates note (reserves) on page 2

Pogo resources and reserves

14

1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 2004 FEASIBILITY 2010 2011 2012 2013 2014 2015 2016 2017

OUNCES Year End reserve Year End resource (Exclusive of reserve)

Historical resources and reserves

Resource and reserve growth potential

A significant amount of mineralisation is present outside of the current Pogo Resources, there is also considerable mineralisation inside the current Resources that hasn’t made it into reserves During FY19 NST will look to invest A$15-20M in exploration/drilling to bring more gold into the mine plan

Open Open

15

507 4,267 4.3g/t 4.1g/t 2 4 6 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500

Acquisition Resources & Reserves July 2014 Current Resources & Reserves Aug 2018

Reserve Grade g/t 000' Ounces

Jundee Historical Resource & Reserve Position*

223,727 284,745 $1,008 $870 $860 $880 $900 $920 $940 $960 $980 $1,000 $1,020 50,000 100,000 150,000 200,000 250,000 300,000 FY15 FY18 AISC A$/oz Ounces

Jundee Historical Gold Sold (koz)

Jundee Parallels - Case Study

NST has identified similarities between Pogo & Jundee, which sets up the value creation template for Pogo

Northern Star has a proven track record of extending mine lives, improving production and cost metrics and optimising underground assets The success at Jundee and Kalgoorlie

• perations lay the template for the approach to

Pogo Pogo is an ideal fit for Northern Star’s acquisition and operating model The Jundee Integration team will be the same team to integrate Pogo NST’s proven senior corporate management and operational team are already assisting the highly skilled existing Pogo management and workforce

A Jundee Analogue?

Demonstrated Ability to Extend Life at Underground Gold Mines

742% increase in Resources and Reserves Production 27% Up Costs down 14%

* Resources are inclusive of Reserves

16

• Effective risk management
• Water, carbon, temperature, energy
• 19% FY18 female participation

above industry average

Environmental, Social and Governance Values

• Zero significant incidents or regulator fines
• Portfolio of assets in good standing

Environmental Compliance

• Well established and compliant
• Long-term teams

Management System

• Zero stakeholder complaints
• Expanded Company Ranger Program
• Board-level ESG and Safety Committee
• Senior reporting structure

Governance Diversity

• Inaugural sustainability report FY17
• Sustainability survey (CDP and DJSI)

Transparency

SUSTAINABILITY

Stakeholder Engagement Climate Change

• Modern Slavery Act ready

Human Rights

17

Northern Star investing in its people – a strategic advantage

NST is investing A$50M over the next 10 years to continue expanding our specialist underground mining, geology and processing capability Key areas of investment include training, education, research and implementation of the latest technologies Our commitment to improve productivities and reduce unit costs is culturally imbedded and our capability is scalable to prepare for growth This commitment will place Northern Star in a strategic position to optimise the value of assets as more mines transition from open pit to underground in the future NST has a sector leading safety performance with LTIFR at 0.9 (industry LTIFR of 2.7) and TRIFR at 3.2 (industry TRIFR is 9.6) Safety is a core value of the Company

18

The Northern Star Five-Year Plan

Objective: To increase shareholder value by maintaining our industry-leading financial returns while growing free cashflow Method: Capitalise on and expand our specialist underground mining and exploration teams Utilise our exceptional balance sheet and funding capability Grow production, inventory and free cashflow by acquiring and investing in Tier-1 assets in Tier-1 jurisdictions The team has in-built capacity to oversee production in-excess of 1Mozpa, Reserves

• f 10-15Moz and Resources of 30-50Moz

Ensure margins remain at ~50% on AISC, retaining NST’s position in the lowest-cost quartile globally Maintain our licence to operate by investing in, and earning the respect of, the communities in which we live and work Conclusion: This combination is unique. It is Northern Star’s key point of difference among its global peer group. Collectively, these attributes maximise our ability to meet the objective.

19

Northern Star Resources

An Australian Mid Cap Global gold miner – Growing Against the Tide

Contact Details: Luke Gleeson – Investor Relations +61 8 6188 2100 Email – info@nsrltd.com Website – www.nsrltd.com

20