CREATING A PREMIER AFRICAN GOLD PRODUCER Corporate Presentation December 2016 0
Disclaimer & Forward Looking Statements Cash cost per ounce and all-in sustaining cash cost per ounce are non-GAAP market prices of mining consumables, possible variations in ore reserves, performance measures with no standard meaning under IFRS. This grade or recovery rates; failure of plant, equipment or processes to operate presentation contains “forward -looking statements” including but not as anticipated; accidents, labour disputes, title disputes, claims and limited to, statements with respect to Endeavour’s plans and operating limitations on insurance coverage and other risks of the mining industry; performance, the estimation of mineral reserves and resources, the timing delays in the completion of development or construction activities, changes and amount of estimated future production, costs of future production, in national and local government regulation of mining operations, tax rules future capital expenditures, and the success of exploration activities. and regulations, and political and economic developments in countries in Generally, these forward-looking statements can be identified by the use of which Endeavour operates. Although Endeavour has attempted to identify forward-looking terminology such as “expects”, “expected”, “budgeted”, important factors that could cause actual results to differ materially from “forecasts” and “anticipates” . Forward-looking statements, while based on those contained in forward-looking statements, there may be other factors management’s best estimates and assumptions, are subject to risks and that cause results not to be as anticipated, estimated or intended. There uncertainties that may cause actual results to be materially different from can be no assurance that such statements will prove to be accurate, as those expressed or implied by such forward-looking statements, including actual results and future events could differ materially from those but not limited to: risks related to the successful integration of acquisitions; anticipated in such statements. Accordingly, readers should not place risks related to international operations; risks related to general economic undue reliance on forward-looking statements. Please refer to Endeavour’s conditions and credit availability, actual results of current exploration most recent Annual Information Form filed under its profile at activities, unanticipated reclamation expenses; changes in project www.sedar.com for further information respecting the risks affecting parameters as plans continue to be refined; fluctuations in prices of metals Endeavour and its business. including gold; fluctuations in foreign currency exchange rates, increases in Adriaan “ Attie ” Roux, Pr.Sci.Nat , Endeavour’s Chief Operating Officer, is a Qualified Person under NI 43 -101, and has reviewed and approved the technical information in this presentation. CREATING A PREMIER AFRICAN GOLD PRODUCER 1
Endeavour Mining Overview Immediate Cashflow from 5 producing mines at low AISC – 2015 production: 517 koz – 2016E production: 575-610 koz – 2015 AISC: US$922/oz – 2016E AISC: US$870 - 920/oz Near-Term Growth from 2 attractive projects – Houndé Project construction started in April 2016, first gold pour expected in Q4-2017 – Ity CIL Project feasibility study demonstrated potential for Ity to become another flagship asset Long-Term Upside from Exploration – Strategic review outlined potential to find 10-15Moz over the next 5 years at a discover cost of <$15/oz – Potential to significantly extend mine lives to beyond 10 years CREATING A PREMIER AFRICAN GOLD PRODUCER 2
Company Profile Share Price Performance Ticker TSX:EDV 7,000,000 30 Volume (shares) EDV share price, C$ Shares in Issue 93.4 m Fully Diluted 95.8 m 6,000,000 25 Share price C$23.26 Market cap US$1,655m 5,000,000 20 Net Debt US$14m 4,000,000 15 3,000,000 10 2,000,000 5 1,000,000 0 0 January-16 February-16 March-16 April-16 May-16 June-16 July-16 August-16 September-16 October-16 November-16 As of November 7 th 2016 Current shareholder distribution and geographic mix Board Members Michael Beckett Sebastien de Montessus Livia Mahler Retail Chairman, Non-executive Director CEO & President & Director Non-executive Director Institutional 7% 63% Naguib Sawiris Wayne McManus Olivier Colom Non-executive Director Non-executive Director Non-executive Director La Mancha 29% Ian Cockerill Ian Henderson Non-executive Director Non-executive Director Management 1% 3 CREATING A PREMIER AFRICAN GOLD PRODUCER
Hands-on Management Model MANAGEMENT FOCUS LEAN EXECUTIVE MANAGEMENT TEAM Sebastien de Montessus CEO & President & Director Safety First Adriaan “Attie” Roux Vincent Benoit COO EVP CFO & Corporate Development Lean and Cash flow Efficient driven Operations Patrick Bouisset Jeremy Langford EVP Exploration & Growth EVP Construction Services Hands-On Management Morgan Carroll Henri de Joux EVP Corporate Finance & General Counsel EVP People & Public Affairs CREATING A PREMIER AFRICAN GOLD PRODUCER 4
CLEAR PATH TO BUILD A +900KOZ PRODUCER AT ≤ $800/OZ AISC +900koz Strategic Milestones Ity for 2018-2020 $1,137 CIL + 900 koz ANNUAL PRODUCTION 575-610koz $1,010 ≤ 800$/ oz 517koz ALL IN CASH COST 462koz $922 10+ year 317koz $870-920 MINE LIFE IN OUR CORE ASSETS 220koz <$800 167koz 83koz 2016 2010 2011 2012 2013 2014 2015 2016 6+6 2017 2018 2019 Youga, Burkina Faso Nzema, Ghana Tabakoto, Mali Agbaou, Côte d'Ivoire Ity (Heap Leach), Côte d'Ivoire Karma, Burkina Faso (incl. pre-production) Houndé, Burkina Faso Ity (CIL), Côte d'Ivoire Group AISC Assumes Ity construction starts H1-2017 and first gold production in 2019 with Heap Leach operation ending once CIL starts CREATING A PREMIER AFRICAN GOLD PRODUCER 5
STRATEGIC OBJECTIVE Create a Premier African Gold Producer with Low-cost and Long Life Mines 4 Strategic Levers 1 2 3 4 OPERATIONAL PROJECT UNLOCK PORTFOLIO & BALANCE EXCELLENCE DEVELOPMENT EXPLORATION VALUE SHEET MANAGEMENT Benchmark of West-African Producers AISC, $/oz 1,100 Gold Fields 1,050 1,000 IAMGOLD Golden Star Teranga 950 Endeavour 2015A Endeavour 900 2016E Perseus AngloGold Ashanti Kinross 850 Endeavour Nordgold (output of 800 Resolute strategic exploration review) 750 Newcrest Newmont 700 Randgold 650 Semafo Bubble size represents production 600 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Average mine life, years Source: UBS Research, based on 2015A only West-Africa production. Mine life excludes expansion and development projects such as Kinross’ Tasiast Phase 2 and Resolute’s UG project CREATING A PREMIER AFRICAN GOLD PRODUCER 6
OPERATIONAL EXCELLENCE 1 Proven track record of operating in West-Africa 1) Increased Production 2) Decreased All-in Sustaining Costs Production, on a 100% basis in koz AISC, in US$/oz $1,137/oz 575-610koz 517koz 466koz $1,010/oz $922/oz 324koz $870-920/oz 2013A 2014A 2015A 2016 Guidance 2013A 2014A 2015A 2016 Guidance 3) Increased Cash Generation 4) Low Lost Time Injury Frequency Rate Free cash flow before tax, WC & financing costs, in US$m (realized gold price) Lost Time Injury Frequency Rate (Number of LTIs in the Period X 1,000,000)/ (Total man hours worked for the period) $135m 1.73 $85m 0.76 0.73 $35m $28m 0.27 HI : US$1,150/oz US$1,392/oz US$1,264/oz US$1,157/oz H2: US$1,250/oz 2013A 2014A 2015A 2016 Guidance 2013 2014 2015 First 9-months 2016 Excludes Agbaou, Houndé and Karma capex CREATING A PREMIER AFRICAN GOLD PRODUCER 7
OPERATIONAL EXCELLENCE 1 Group level performance in line with full year guidance First 9 months 2016 Q3- 2016 Comment of 2016 Guidance Q3: +6% over Q2-2016 Production 146koz 416koz 575 - 610koz Growth acceleration expected in Q4 (incl Karma) Production on track to be within guidance Continued decrease achieved in Q3 with success of cost reduction programs All-in Sustaining Costs $898/oz $896/oz $870-920/oz Low AISC trend expected to continue in Q4 Strong cash generation in Q3 Free Cash Flow (before tax, WC , Q4 to benefit from stronger production and $41m $100m $135m 1 start of Karma commercial production financing costs, Houndé and Karma) Well on-track to meet Cash Flow guidance Net Debt Decreased from a net debt position of $14m n/a $242m at the end of September 2015 (end of period) 1 Based on H1 realized gold price of $1,225/oz and $1,250/oz for H2 CREATING A PREMIER AFRICAN GOLD PRODUCER 8
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