For personal use only 7 August 2007 Manager Announcements - PDF document

For personal use only 7 August 2007 Manager Announcements Companies Announcements Office Australian Stock Exchange Limited 10 th Floor, 20 Bond Street SYDNEY NSW 2000 By e-lodgment Dear Sir/Madam MANAGING DIRECTOR’S PRESENTATION – DIGGERS & DEALERS 2007 Please see attached presentation to be made at the Diggers & Dealers Mining Forum, Kalgoorlie by the Company’s Managing Director, Mr Peter Harold. Yours sincerely, SALLY MALAY MINING LIMITED TREVOR ETON Chief Financial Officer & Company Secretary Contact Details: Sally Malay Mining Limited ABN: 47 095 792 288 Level 9, Sally Malay House 553 Hay Street PERTH WA 6000 Ph: 61-8-9225-0999 www.sallymalay.com

For personal use only

FORWARD LOOKING STATEMENTS For personal use only This presentation contains “forward-looking statements”. Such forward-looking statements include, without limitation: • estimates of future earnings, the sensitivity of earnings to metal prices and foreign exchange rate movements; • estimates of future metal production and sales; • estimates of future cash flows, the sensitivity of cash flows to metals prices and foreign exchange rate movements; • statements regarding future debt repayments; • estimates of future capital expenditures; • estimates of reserves and statements regarding future exploration results and the replacement of reserves; and • statements regarding modifications to the Company’s hedge position. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, as well as political and operational risks in the countries and states in which we operate or sell product to, and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Company’s Annual Reports, as well as the Company’s other filings. The Company does not undertake any obligation to release publicly any revisions to any “forward- looking statement” to reflect events or circumstances after the date of this presentation, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.

2007 Milestone Year For personal use only • Group production hits 13,225t Ni • Discovery of Deacon Orebody >58,000t Ni • Repaid all Senior & Subordinated Debt • Extended Sally Malay mine life • Copernicus Feasibility Study released • Net Profit forecast of ~ A$90 million • Maiden dividend anticipated • Inclusion in S&P/ASX 200 Index

Sally Malay Overview August 2006 August 2007 % Change Nickel Price (US$/t) $27,600 $30,000 9% For personal use only Share Price 1.21 3.85 218% Market Capitalisation $220M $700M 218% Nickel Production (Equity) 9,500 12,000 26% Bank Debt (A$) $32M NIL - EBITDA (A$) $65M ~$180M 177% NPAT (A$) $16M $90-100M 460% EPS (cents per share) 10 48 380% Cash (A$) $31M $120M 287% Dividend - Maiden - Well Funded Robust Cash Position Increased Resource Base Strong Margins Sustainable Profits Quality & Diversity of Assets

Corporate • $3 million IPO in Sept 2001 at $0.20 Started Feb 2001: Initial Market Cap $12M • For personal use only Shares on Issue: 186.4 million • 8.2 million (various strikes) Unlisted Options: • $3.63 - $4.80 (July 2007) Trading Range: • ~$700M-$1B (fully diluted) Market Cap: • ~5,300 (as at June 2007) Shareholders: • ~$140M cash Liquid Assets: • Nil Senior Debt: • ~$13M Finance Leases: • Board: – Chairman Chris de Guingand – Managing Director Peter Harold – Non-exec Directors Chris Langdon John Rowe Brian Phillips

Share Price - Major Milestones Upgraded New Massive Deacon Sulphides at Senior & Resource $6.00 Sally Malay Subordinated 58,000t Ni Winner Upgrade Debt Repaid 6,140t Ni For personal use only $5.00 Initial Deacon Resource 42,000t Ni Sally Malay Share Price $4.00 Half Yearly 06 (A$ per share) Profit $32M Deacon Discovery $3.00 Winner Mine Approval 05/06 Profit $15.9M $2.00 $1.00 $0.00 6 7 7 6 7 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 t y t r y s s e a r u u a b M g u g m u r 1 u e b A A v e 1 o 1 F N 1 1

Production On the Way to 20,000tpa Sally Malay Group Nickel Production (100% Basis) ( Sally Malay Project - Nickel in Concentrate, Lanfranchi Project - Nickel in Ore) For personal use only Schimtz Ext 25000 Deacon 20000 Tonnes Nickel Winner 15000 Helmut Sth 10000 Copernicus 5000 Sally Malay 0 2004/05 2005/06 2006/07 2007/08 2008/09 Forecast Target ssumptions Financial Year Winner from Oct 2007 *Revised Targets 30 June 2007 eacon from Nov 2007 opernicus from Q2 2008 (assumes open pit early 2008)

Production On the Way to 20,000tpa Sally Malay Group Nickel Production (Equity Basis) ( Sally Malay Project - Nickel in Concentrate, Lanfranchi Project - Nickel in Ore) For personal use only Schimtz Ext 25000 Deacon 20000 Tonnes Nickel Winner 15000 Helmut Sth 10000 Copernicus 5000 Sally Malay 0 2004/05 2005/06 2006/07 2007/08 2008/09 Forecast Target ssumptions inner from Oct 2007 (75%) Financial Year eacon from Nov 2007 (75%) *Revised Targets 30 June 2007 opernicus from Q2 2008 (assumes open pit early 2008) – (60%)

Two Production Centres in WA For personal use only

Fill the Sally Malay Mill +1.0 Million tpa For personal use only

Fill the Sally Malay Mill +1.0 Million tpa “CHAMPAGNE CONCENTRATE” For personal use only • 8-9% Ni • 4-5% Cu • 0.5-1.0% Co • Fe:MgO ratio 80:1 • No penalties LOGISTICS • Shipped via Wyndham • 100,000 tonnes/year • Offtake with Jinchuan • Monthly shipments • Paid 100% in 7 days

Production Increasing Multiple Ore Sources - Sally Malay For personal use only - Copernicus Sally Malay Nickel Production ( Nickel in Concentrate) 12000 10000 8000 6000 4000 2000 0 2004/05 2005/06 2006/07 2007/08 2008/09 Forecast Target Financial Year Sally Malay Copernicus * Revised Targets 30 June 2007

Fill the Sally Malay Mill +1.0 Million tpa SALLY MALAY OREBODY Initial Resource For personal use only • 3.74Mt @ 1.74% Ni for 65,000t Ni Initial Reserve • 3.4Mt @ 1.56% Ni for 53,000t Ni Production to 30 June 07 • 1.9Mt @ 1.22% Ni for 23,200t Ni Current Reserve • 2.8Mt @ 1.32% Ni for 37,000t Ni Reserve increase of 7,000t Ni Increase in Mine Life

Fill the Sally Malay Mill +1.0 Million tpa SALLY MALAY OREBODY POSSIBLE EXTENSIONS For personal use only THE DEEPS Potential to add significant Nickel Previous owner estimates: • Anglo American 80,000t Ni • Normandy Poseidon 40,000t Ni Non-JORC Resource • 1.63Mt @ 1.65% Ni = 27,000t Ni • Calculated by MRT Feb 1996 • +3 years of additional mining Deep Drilling • Drilling off decline • Timing – late 2007

Fill the Sally Malay Mill +1.0 Million tpa NEW MASSIVE SULPHIDE MINERALISATION • Two zones of significant mineralization For personal use only • Untested contact position Results • 17.7m @ 1.98%Ni, 0.22%Cu, 0.10%Co • 8.58m @ 1.17%Ni, 0.50%Cu, 0.06%Co Location • ~300m below surface • ~150m from Sally Malay orebody • ~60m from Decline development Exploration • Drilling ongoing

Fill the Sally Malay Mill +1.0 Million tpa COPERNICUS Resource • 852kt at 1.24% Ni for 10,600t Ni OPEN PIT For personal use only Feasibility • Open Pit & Underground • 784kt at 1.1% Ni for 8,500t Ni • NPV range of $10-100M Development Schedule • Q3/Q4 2007 - approvals COPERNICUS • Q1 2008 - Commence Open Pit MINERALISATION • Q2 2008 – treat ore • Q4 2008 – decision on UG Deeps Exploration • EM Targets • more drilling this year POTENTIAL EXTENSION

Fill the Sally Malay Mill +1.0 Million tpa THE PANTON FACTOR For personal use only Resource • Global 14.3Mt @ 5.2g/t PGM g/t • Hi Grade 10.1Mt @ 6.1g/t PGM g/t JV • SMY to spend up to $750,000 • 2 stage Feasibility Study • Mining, metallurgy, offtake • 50% of 1 st 1.5Mt high grade ore Concept • Up to 400ktpa spare mill capacity • Established infrastructure • PGM concentrate to Jinchuan or 3 rd party

Two Production Centres in WA For personal use only

Fill the Nickel West Kambalda Mill +350,000tpa LANFRANCHI PROJECT Geology For personal use only Elongated lenses Along Ultramafic-Basalt contact Historic Production (previous owner) 3.1Mt at 3.2% Ni = 98,450t Ni Schmitz 783,500t at 4.6% Ni Skinner 297,800t at 4.9% Ni Lanfranchi 1.4Mt at 2.3% Ni Exploration upside Down dip & plunge all orebodies New orebodies – ie. Deacon EM targets Northern Tramways Dome

Fill the Nickel West Kambalda Mill +350,000tpa For personal use only