Presentation Building a Significant Diversified Mid-Cap Producer - - PDF document

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Presentation Building a Significant Diversified Mid-Cap Producer - - PDF document

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13 June 2007 Presentation Building a Significant Diversified Mid-Cap Producer Attached is a copy of a presentation to be delivered by Bruce Hooper, Exploration Manager, at the RBC Capital Markets Conference in Toronto on Wednesday 13 June. A

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13 June 2007

Presentation – Building a Significant Diversified Mid-Cap Producer

Attached is a copy of a presentation to be delivered by Bruce Hooper, Exploration Manager, at the RBC Capital Markets Conference in Toronto on Wednesday 13 June. A copy of this presentation will be posted on Perilya’s website at www. perilya.com.au. For Further Information:

Darryl Edwards Company Secretary Perilya Limited ACN 009 193 695 Phone: 61 8 6210 2018

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RBC Capital Markets Conference Toronto, June 2007 Building a significant diversified mid-cap producer

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Overview

  • launch platform for sustainable growth
  • An Australian resource company
  • The fourth largest ASX listed zinc and lead producer
  • Solid earnings foundation at Broken Hill
  • Strong balance sheet
  • Advanced development pipeline
  • Exploring at Flinders, Mount Oxide and Broken Hill
  • Evaluating M & A opportunities

Corporate Broken Hill Flinders Mount Oxide Growth

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Slide 3

Zinc production growth profile

Corporate Broken Hill Flinders Mount Oxide Growth

  • 50,000

100,000 150,000 200,000 250,000 Contained Zinc (tonnes) Broken Hill Southern Operations Reserves Broken Hill Southern Operations Resources & Upside Potosi Resource North Mine Deeps Potential Beltana

High Grade & Intermediate Ore

Potosi Upside Broken Hill

North Mine

Flinders Resource Potential

(Reliance, Aroona & Moolooloo)

2007 ~ 2015

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Financial performance

Corporate Broken Hill Flinders Mount Oxide Growth

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Company S tructure AS X : PEM

Shares on issue: 196M Options: 4.5M Market Capitalisation: A$862M

(Undiluted at $4.40 per share)

Key Shareholders:

Korea Zinc: 10.0% Barclays Global Investors: 9.7% Delta Partners: 5.6% Board & Employees: 2.7%

Corporate Broken Hill Flinders Mount Oxide Growth

Relative Share Price Performance Index (A$)

50 100 150 200 250 Jun 2006 Sep 2006 Dec 2006 Mar 2007 Jun 2007

PEM ASX/200

Geographic Analysis of Share Register (May 2007) 20 40 60 80

Australia UK North America Europe (ex UK) Asia New Zealand Unknown

Shares (m)

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Corporate Broken Hill Flinders Mount Oxide Growth

Operating Operating Projects Projects Exploration Exploration

Tampang (Cu, Au) Tampang (Cu, Au)

Mount Oxide (Cu) Mount Oxide (Cu)

Beltana (Zn) Beltana (Zn) Broken Hill (Zn, Pb, Ag) Broken Hill (Zn, Pb, Ag)

Dee Range (Cu, Zn) Dee Range (Cu, Zn)

Potosi (Zn, Pb, Ag) Potosi (Zn, Pb, Ag) North Mine Deeps (Zn, Pb, Ag) North Mine Deeps (Zn, Pb, Ag)

Flinders (Zn) Flinders (Zn)

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Broken Hill

– operations and potential

Southern Operations & North Mine

120 kt Zn 70 kt Pb 2 Moz Ag

Ave annual metal production

5 years

Mine life

1.9Mtpa

Production rate

11.6mt @ 7.3% Zn 4.8% Pb 47.7g/t Ag

Reserve

(as at 30 Jun 2006)

4.2mt @ 11.2% Zn 13.7% Pb 214g/t Ag

Resource

(as at 30 Jun 2006)

Pre-feasibility study due Sept Qtr

Project status North Mine Deeps Redevelopment

Exploration decline advanced 385m from portal

Project status

1.6mt @ 13.0% Zn 3.1% Pb 43g/t Ag

Resource

(as at 30 Jun 2006)

Potosi Exploration Decline

Operating Developing

Corporate Broken Hill Flinders Mount Oxide Growth

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Broken Hill exploration

  • targeting 10+ year mine life

5 km

North Mine Southern Operations

City

Potosi

Piesses Knob Flying Doctor Round Hill Southern Ops Extensions

Stirling Vale 1130 Smiths Sam Deeds Henry George Monarch Flat Exploration targets

Mill

Surface projection of ore bodies Perilya Broken Hill Mining Lease Existing Operations

  • A$12M exploration budget 2007/08

−

extend existing resources − identify new satellite ore bodies − major new discovery

Corporate Broken Hill Flinders Mount Oxide Investment

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Broken Hill infrastructure the foundation for growth

  • spare concentrator capacity

North Mine Deeps 0.2 – 0.4 Mt per annum North Mine Deeps 0.2 – 0.4 Mt per annum North Mine 0.1 – 0.2 Mt per annum North Mine 0.1 – 0.2 Mt per annum Southern Operations 1.9 Mt per annum Southern Operations 1.9 Mt per annum Potosi Mine 0.2 – 0.4 Mt per annum Potosi Mine 0.2 – 0.4 Mt per annum

evaluating existing

Broken Hill Concentrator

2.8 Mt Capacity

Southern Operations North Mine Potosi Mine North Mine Deeps

Corporate Broken Hill Flinders Mount Oxide Growth

Satellite open pitable deposits ?? Satellite open pitable deposits ??

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Potosi Mine

  • targeting 4mt @

10-12% zinc and 3-5% lead

Corporate Broken Hill Flinders Mount Oxide Growth

North

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S

  • uthern lodes
  • 3D predictive modelling
  • Built geological understanding of ore zones
  • Modelled blocks for untested priority

stratigraphy

  • Each large block potentially contains a

10 Mt deposit Potential 10 Mt deposits

Corporate Broken Hill Flinders Mount Oxide Growth

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Northern lodes

  • Round Hill Deeps #1 geological target

Corporate Broken Hill Flinders Mount Oxide Investment

2.3m @ 4.0% Pb/Zn 3.4m @ 7.0% Pb/Zn 3.1m @ 10.0% Pb/Zn s

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Rail line Tenements

Flinders zinc oxide proj ect

  • 4,183km2 landholding

Corporate Broken Hill Flinders Mount Oxide Growth

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Flinders zinc proj ect

  • deposit location & infrastructure
  • Currently mining Beltana
  • Base case IRR 135%
  • Cluster of deposits

Leigh Creek

Beltana Mine

Reliance Moolooloo Aristotle Aroona II Tom Thumb Aroona Sundown Wallrider

Corporate Broken Hill Flinders Mount Oxide Growth

On track loading

Rail Road 5 km Exploration targets Operation Relative scale of current resource Development targets

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Intermediate Grade Product 392kt @ ~ 30% = 110kt metal POTENTIALLY MARKETABLE

Reliance

355kt @ 29.5% Zn = 105 Kt metal

Other

235kt @ 30.2% Zn = 71 Kt metal

Stage 2

Evaluate potential of deposits along strike

Stage 3

Evaluate beneficiation Corporate Broken Hill Flinders Mount Oxide Growth

Flinders – direct shipping ore

  • separate stockpiling creates blending opportunities

Flinders 966kt @ 31% Zn = 300kt metal

Stage 1 - Beltana

376kt @ 32.6% Zn = 123 kt metal

Low Grade Product 242kt @ 21.5% = 53kt metal UNMARKETABLE High Grade Product 150kt @ 38.1% = 57kt metal MARKETABLE

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  • Major mineralised province
  • Similar style deposit to Mount

Gordon (14.9Mt @ 2.9% Cu)

  • 747km² landholding
  • 25km from Mount Gordon
  • peration

Mount Oxide

  • high grade copper proj ect

Corporate Broken Hill Flinders Mount Oxide Growth

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Slide 17 1m @ 1.6 % Cu 15m @ 1.2 % Cu Haemitite Breccia

Mount Oxide – potentially treble resource to 300kt Cu

Corporate Broken Hill Flinders Mount Oxide Growth % Cu Metal Kt Cu % Ore Tonnes 100% 112Kt 2.8% 4.0 Mt Total 67 75 3.0 2.5 Indicated 33 37 2.5 1.5 Inferred

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Corporate Broken Hill Flinders Mount Oxide Investment

? ?

>0.2% Cu >1.5% Cu

Current Resource

Mount Oxide

  • open along strike both north, south & below existing resource
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ORGANIC & NEW BUSINESS GROWTH

FLINDERS

  • High grade zinc
  • Low capital cost
  • Short lead time
  • Strong demand for

concentrate / high grade

  • re

M & A

  • Base metals
  • Diversify dual asset cash

flow

MOUNT OXIDE

  • 112kt copper resource
  • High grade copper & low

arsenic

  • 25km from Mount Gordon
  • peration

BROKEN HILL

  • Underutilised mill
  • Potosi exploration decline
  • North Mine Deeps

Pre-feasibility Study

  • Near Mine Exploration
  • Regional Exploration

$150M cash $18M debt

Corporate Broken Hill Flinders Mount Oxide Growth

COMMODITY MARKETS

  • Zinc & lead prices

underpinned by strong supply & demand fundamentals

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Perilya – investment proposition

  • Significant production profile
  • Strong balance sheet
  • Low geo-political risk
  • Near term, low capex growth opportunities
  • Strong zinc, lead and copper markets

Corporate Broken Hill Flinders Mount Oxide Growth

Zinc Price & LME Inventory Levels

150,000 300,000 450,000 600,000 750,000 Jan-05 May-05 Sep-05 Jan-06 May-06 Sep-06 Jan-07 May-07 LME Stockpiles (tonnes) 1,000 2,000 3,000 4,000 5,000 Zinc Price (US$/t)

Lead Price & LME Inventory Levels

25,000 50,000 75,000 100,000 125,000

Jan-05 May-05 Sep-05 Jan-06 May-06 Sep-06 Jan-07 May-07

LME Stockpiles (tonnes) 500 1,000 1,500 2,000 2,500 Lead Price (US$/t)

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Corporate Broken Hill Flinders Mount Oxide Growth

Cash / Market Cap

0% 10% 20% 30% 40% 50% 60% Aditya Birla Kagara Pan Aust Zinifex Sally Malay Jubilee Jabiru Perilya CBH

Source : Perilya & UBS

Perilya – significant cash holdings

Cash

6.2 14.6 75.4 88.0 150.6 251.6 289.5 834.2

  • 100

200 300 400 500 600 700 800 900 Aditya Birla Kagara Jabiru Sally Malay Perilya CBH Jubilee Zinifex

(including $200M convertible note)

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Corporate Broken Hill Flinders Mount Oxide Growth

Source : UBS PE RATIO

10.9

7.4 9.6 4.8 4.8 5.3 5.4 11.3

4.0 5.5 9.6 5.3 7.0 10.7

  • 2.0

4.0 6.0 8.0 10.0 12.0 Perilya Aditya Birla CBH Sally Malay Zinifex Kagara Jubilee

2009E 2008E

EV / EBITDA

2.5 2.9 3.1 3.2 4.2 2.2 2.9 4.3 6.3 7.6 5.8 2.8 5.7 5.9

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 Perilya Sally Malay CBH Aditya Birla Zinifex Kagara Jubilee 2009E 2008E

Perilya –low multiples vs peer group

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… … … . positioning for

sustainable growth