Gold Investment Symposium 2012 - Jake Klein - Evolution Mining

The Revitalisation

of the Australian Gold Industry

Gold Investment Symposium – 23 October 2012

Jake Klein – Executive Chairman

Disclaimer

This presentation has been prepared by Evolution Mining Limited (“Evolution Mining”) and consists of slides

for a presentation concerning the company. By reviewing/attending this presentation, you acknowledge and

agree the following.

This presentation includes forward-looking statements. Forward-looking statements inherently involve

subjective judgement and analysis and are subject to a number of risks, uncertainties, contingencies and

other factors, many of which are outside the control of, and may be unknown to, Evolution Mining. As such,

actual results or performance may vary materially from those expressed or implied by forward-looking

statements. The types of factors that could cause such variation in actual results or performance include

(without limitation) commodity prices, operational problems and general economic conditions. Given these

factors, undue reliance should not be placed on forward-looking statements, which speak only as at the date

of this presentation. Subject to any continuing obligations under applicable law or any relevant stock

exchange listing rules, Evolution Mining does not undertake any obligation to publicly update or revise any

forward-looking statements contained in this presentation, including (without limitation) where Evolution

Mining’s expectations change in relation to such statements and where there is a change in events,

conditions or circumstances providing the basis for any such statement.

No representation or warranty, express or implied, is made as to the accuracy, completeness, reliability,

fairness or correctness of the information contained in this presentation. To the maximum extent permitted

by law, Evolution Mining and its related bodies corporate and affiliates, and each of their respective directors,

officers, employees, agents and representatives, disclaim any liability or responsibility for loss or damage

arising from or in connection with the use of the information contained in this presentation.

Corporate Information

ASX Code EVN

Index S&P ASX200

Shares 707.9M

Last Price 1 A$2.00ps

Market Capitalisation A$1.4B

Daily Turnover 2 A$3.0M

Cash 3 A$142.0M

Debt 3 A$31.5M

Forward Sales 3 224,177oz at

A$1,573/oz

Major Shareholder Newcrest 33%

1. As at 16 Oct 2012

2. 3 month average as at 16 Oct 2012

3. As at 30 June 2012.

Who we are

Cracow Gold Plant, Queensland

Mt Carlton

Cracow

Pajingo

Edna May

Mt Rawdon

4th Largest ASX Listed Gold Mining Company

1

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

Sp

ot

Go

ld P

rice (

US

$/o

z)

Gold

Still in a gold bull market

2

Source: World Gold Council

Central Banks Buying Gold

-25

-20

-15

-10

-5

0

5

10

15

20

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

20

11

H1 2

012

Millio

n O

un

ces

Central Bank - Net Gold Purchases There has been

widespread buying by

Central Banks

2012 YTD purchases

total 8.5Moz by 17

countries including:

Turkey 3.2Moz

Russia 1.7Moz

Philippines 1.1Moz

Kazakhstan 0.7Moz

Mexico 0.6Moz

See footnotes at end of presentation

3

Central Bank Holdings

See footnotes at end of presentation

Top 10 Central Banks

hold 760M ounces of

gold worth US$1.3T

All Central Banks

combined hold just

over 1B ounces of

gold worth US$1.8T

Australia ranks 36th

with 2.6M ounces

0

50

100

150

200

250

300

United S

tate

s

Ge

rma

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IMF

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Fra

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itze

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ssia

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s

Ind

ia

EC

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ite

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Spain

Mill

ion O

unces

Top 20 Central Bank Gold Holdings

Denotes those Central Banks with

<10% of Reserves held in gold

4

Gold ETF Holdings

Total amount of gold

currently held by gold ETFs

is about 83M ounces – or

about US$150B

So US$150B invested on

the basis that the gold price

will rise – ETFs don’t pay

dividends

$500

$700

$900

$1,100

$1,300

$1,500

$1,700

$1,900

$2,100

10

20

30

40

50

60

70

80

90

Total ETF Holdings (Moz) Price (US$/oz)

Total ETF Gold Holdings

and Gold Price

Source: Macquarie Bank

5

Gold shares have underperformed

Camp construction

Investor frustration is palpable

6

+244%

+82%

-

50

100

150

200

250

300

350

400

HUI Gold Index (rebased) Gold Price (rebased)

Source: World Gold Council

What is weighing gold stocks down?

Resource Nationalism

Failure to Meet Guidance

Capital Blowouts

7

Venezuela: Five mining

companies seeking

compensation through

World Bank’s arbitration

court following

nationalisations

Peru: Construction

halted at largest mine

due to government

review and social unrest

Ecuador: Political

obstacles and windfall tax

discourage foreign

investment in mining

Bolivia: Nationalisation

of various natural

resources assets

Argentina: New government

rule reduces time limit to

cash-in earnings from 360 to

30 days. Controls on imports

have also been tightened

Ghana: Raise in tariffs on

mines and introduction of

windfall tax halting project

expansions Guinea: New law gives

government a 35% stake.

threat of nationalisation

Mali: Recent military coup

creating political uncertainty

Zambia: Increased royalties

on copper and precious

metals

Indonesia: Proposed

new legislation limits

foreign ownership of

mines to 49%, and ban

on export of unprocessed

raw mineral products.

Philippines: New

royalties and taxes being

imposed on mining

companies

Mongolia: Drafting

investment law to restrict

foreign ownership.

Kyrgyzstan:

Parliamentary motion

calling for government to

increase stake in one of

its largest gold mines

Guatemala: Proposal for

40% state ownership of

mining projects

DRC: Plans to revise

mining code, raise taxes

and increase stake in

mining projects

Resource Nationalism

South Africa: Windfall tax

proposed + ongoing dialogue

to nationalise mining industry

8

USA: Worst ranked

nation for mining permit

delays. Recently

proposed a tax on royalty

gains

Brazil: Govt. seeking to have

minerals beneficiated in-

country

Poland: Imposing new

steep export levies

Countries where nationalisation practises are taking place

Countries ranking in bottom 10 for political risk – Behre Dolbear survey 2012

Access to capital

Camp construction Capital has been cheap and easy

Precious Metals Mining Equity Financings

Source: CIBC World Markets

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

2009 2010 2011 2012 YTD

US

$ b

illio

ns

TSX ASX

9

The new normal

• Will be more accurately priced

• Australia to be re-rated favourably Political Risk

• Key focus

• Capital less freely available and more expensive

Capital Discipline

• More focus on returning money to shareholders Dividends

• Will be more difficult and expensive to fund single asset companies Consolidation

10

Where do you want to be?

315%

143%

37%

Global Senior Producers: Barrick Gold Corp., Newmont Mining Corp., Newcrest Mining Ltd., Goldcorp Inc., AngloGold Ashanti Ltd. and Gold Fields Ltd. Global Mid-tier Producers: Evolution Mining, Semafo Inc., Randgold Resources Ltd., IAMGOLD Corp., African Barrick Gold PLC, Teranga Gold Corp., Avocet Mining PLC, Avion Gold Corp., Perseus Mining Ltd. and Resolute Mining Ltd. Global Developers: Keegan Resources Inc., Ampella Mining Ltd., Orezone Gold Corp., Banro Corp., Chalice Gold Mines Ltd. and Volta Resources Inc.

Last 5 years relative price performance

-

100

200

300

400

500

600

700

800

900

Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12Global Senior Producers Global Mid-tier Producers Gold Price

Ind

ex

ed

Mid-tier producers have

delivered best returns

11

Source: Credit Suisse

Australian Gold Sector

Single asset company (majority foreign assets)

Multiple asset company (majority foreign assets)

Single asset company (majority Australian assets)

Multiple asset company (majority Australian assets)

Ma

rket

Ca

p (

$M

)

As at 12 Oct 2012

21,298

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

New

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Ala

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Evolu

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Gold

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Un

ity

Gold

Ro

ad

12


Ma

rket

Ca

p (

$M

)

Single asset company (majority foreign assets)

Multiple asset company (majority foreign assets)

Single asset company (majority Australian assets)

Multiple asset company (majority Australian assets)

21,298

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

New

cre

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Regis

Ala

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Evolu

tio

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/In

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Unity

Gold

Ro

ad

13

As at 12 Oct 2012 Change is required and is coming

$0

$200

$400

$600

$800

$1,000

2001 2003 2005 2007 2009 2011

Average Australian Cash Operating Costs

A$713/oz

A$332/oz

$A/oz

Source: Deutsche Bank, Intierra

Australia - Cost Inflation

Labour 30%

Services 24% Power 12%

Diesel 9%

Consumables 25%

Global Gold – Cost Split

Australian gold miners have

been price takers for skilled

labour and mining services

Compounded by strengthening

currency

14


China 13%

Australia 9%

United States 8%

Russia 8%

South Africa 7%

Peru 7%

Indonesia 4%

Canada 4%

Ghana 3%

Other 37%

Source: Thomson Reuters GFMS, World Gold Council

Australia is the second

largest gold producing

country in the world

Stable regulatory

framework

High quality workforce

Only one major gold

mining company

15

A Perfect Storm?

Strengthening gold price?

Depreciating currency?

Exploration technology and innovation

Vibrant mid-tier companies emerging

16

Australia can

regain its

status as a

premier gold

investment

destination

Australia’s newest mid-tier producer

All assets 100% owned

Excellent exploration potential

3.3Mozeq Ore Reserves

7.0Mozeq Mineral Resources

Defined growth profile

Evolution FY13 Production Outlook

370koz – 410koz AuEq 17


Evolution created 2 November 2011

Dec Q 2011 – 89,812oz at A$698/oz

Mar Q 2012 – 84,122oz at A$809/oz

Jun Q 2012 – 97,149oz at A$762oz

Notes:

Production represents total production i.e. assumes 100% asset ownership at all dates. Ownership interest in Cracow increased from 30% to 100% on 2 November 2011, 100% of Mt Rawdon

acquired 2 November 2011, and 100% of Pajingo acquired 18 October 2011.

Cash costs are before royalties and after silver credits.

FY2012 total production of 346,979oz – within guidance

FY2012 average cash cost of A$771/oz – below guidance

18


FY12 Corporate Highlights – merger delivers as planned

Strong underlying profit result of A$63 million (for partial year ownership)

Operations deliver record underlying EBITDA* of A$225 million

Investment of A$244 million in operational predictability and growth

Strong balance sheet maintained with cash of A$141.8 million

* Site EBITDA is before all corporate administration costs, non-recurring items and exploration expenses

$74M

$65M

$45M $41M

0

20,000

40,000

60,000

80,000

Mt Rawdon Cracow Edna May Pajingo

EBITDA (A$k)

33% 29% 20% 18%

Contribution to site EBITDA

19

Cracow Consistent production – operating since 2004

Produced 102,565oz at a cash cost of A$678/oz

in FY2012

FY2013 outlook of 90,000 – 100,000oz at a

cash cost of A$780 – A$820/oz

Mine Type Underground

Minerals Gold and silver

Mineralisation type Low-sulphidation epithermal

Throughput 550ktpa

Average grade 6g/t gold

Recovery 93%

FY2013 production

outlook 90,000 – 100,000oz

FY2013 cash cost

outlook A$780 – A$820/oz

Mine Life 5 years

Ore Reserves 0.24Moz gold

Mineral Resources 0.77Moz gold

101,724oz 102,565oz

0

20,000

40,000

60,000

80,000

100,000

120,000

FY2011A FY2012A FY2013F

Pro

du

cti

on

(o

z)

Production ounces Guidance Range

90,000-100,000oz

20

45,889oz

75,747oz

0

20,000

40,000

60,000

80,000

100,000

FY2011A FY2012A FY2013F

Pro

du

cti

on

(o

z)


85,000-90,000oz

Pajingo Field has produced 2.6Moz since 1996 – and

excellent, demonstrable exploration upside

remains

Produced 75,747oz at a cash cost of

A$780/oz in FY2012; a 165% increase on

FY2011

FY2013 outlook of 85,000 – 90,000oz at a

cash cost of A$730 – $780/oz

Mine Type Open pit and underground

Minerals Gold

Mineralisation type Low-sulphidation epithermal

Throughput 650ktpa

Average grade 6.2g/t UG and 3.6g/t OP

Recovery 95%

FY2013 production

outlook 85,000 – 90,000oz

FY2013 cash cost

outlook A$730 – A$780/oz

Mine Life 5 years


Mineral Resources 0.89Moz gold (excl. Twin

Hills)

21

65,593oz 73,264oz

0

20,000

40,000

60,000

80,000

100,000

FY2011A FY2012A FY2013F

Pro

du

cti

on

(o

z)


75,000-80,000oz

Turnaround underway; focus on reducing costs

Produced 73,264oz at a cash cost of A$949/oz

in FY2012

FY2013 outlook of 75,000 – 80,000oz at a cash

cost of A$840 – A$890/oz

Studies to increase plant throughput to over

3Mtpa via secondary crushing completed – with

positive results Edna May Crushing Circuit

Mine Type Open pit


Mineralisation type Reef structures and gold

stockwork

Throughput 2.6Mtpa

Average grade 1.0g/t gold

Recovery 90%

FY2013 production

outlook 75,000 – 80,000oz

FY2013 cash cost

outlook A$840-A$890/oz

Mine Life 9 years



Edna May

22

89,636oz 95,403oz

0

20,000

40,000

60,000

80,000

100,000

120,000

FY2011A FY2012A FY2013F

Pro

du

cti

on

(o

z)


95,000-110,000oz

Mt Rawdon Consistent production

Produced 95,403oz at a cash cost of

A$684/oz in FY2012

FY2013 outlook of 95,000 – 110,000oz at

a cash cost of A$600 – A$660/oz

Higher production in FY2013 due to

access to higher grade ore sources

Mine Type Open pit


Mineralisation type Volcanic hosted

Throughput 3.5Mtpa

Average grade 1.0g/t gold

Recovery 90%

FY2013 production

outlook 95,000 – 110,000oz

FY2013 cash cost

outlook A$600-A$660/oz

Mine Life 8 years



23

High quality new project

Key growth project – commissioning on

schedule for December quarter

Mt Carlton to be the lowest cost mine in

the portfolio in FY2014

Greenfields development – discovered in

2006

Significant exploration upside

Mt Carlton

10

Stage Construction

Mine Type Open pit

Minerals Gold, silver and copper

Mineralisation type High-sulphidation epithermal

Throughput 800,000tpa

Average grade V2 open pit – 3.7g/t gold eq.

FY2013 ramp-up

production outlook 25,000 – 30,000ozeq payable

Mine Life 12 years

Ore Reserves 1.2Moz gold equivalent

Mineral Resources 2.2Moz gold equivalent

24

Exploration and Discovery

Five projects in multi-million ounce gold provinces

Strategic landholding = 6,800km2

Within the highly prospective Yilgarn Craton (WA), Drummond and Bowen

Basins (Qld)

Actively pursuing regional consolidation opportunities to leverage off existing

infrastructure

Technical expertise, critical mass and financial capacity to deliver exploration

success

Exploration strategy to deliver sustainable growth, extend mine life and

concurrently explore transformational targets

FY2013 exploration budget of A$28 million

>100,000m drilling planned

25

Meaningful Growth

• Challenging debt and equity markets

• World-class understanding of Asia Pacific region

• Key competitive advantage

• Aggressive exploration – funded through strong balance sheet and cash flow

• A$28 million committed in FY2013

26

Australian gold producer – alternate

investment opportunity

Operational predictability – delivering

to promise

Financial strength

Proven management team

Delivering meaningful growth

Right place, right time – new Australian mid-tier gold producer

We Say, We Do, We Deliver

Globally Competitive

27

Footnotes

Slide title: Central Banks Buying Gold – page 3

Data are taken from the International Monetary Fund's International Financial Statistics (IFS) and other sources where

applicable. The data does not include all gold holders: other countries are known to hold gold but they do not report their

holdings publicly. Data includes holdings by IMF and BIS. The purchase of 454 tonnes of gold by China, announced in April

2009 took place over a six-year period from 2003 - 2009. Assumed purchased evenly over this period. Where the World Gold

Council knows of movements that are not reported to the IMF or misprints, changes have been made to the data.

Slide title: Central Bank Holdings – page 4

Data are taken from the International Monetary Fund's International Financial Statistics (IFS), October 2012 edition, and other

sources where applicable. IFS data are two months in arrears, so holdings are as of August 2012 for most countries, July 2012

or earlier for late reporters.

Total includes holdings by IMF and BIS. Total does not include all gold holders: countries which have not reported their gold

holdings to the IMF are not included. The data has been adjusted by the World Gold Council where it knows of movements that

are not reported to the IMF or misprints.

The percentage share held in gold of total foreign reserves, as calculated by the World Gold Council. The value of gold holdings

is calculated using the end of month London pm fix gold price published daily by the LBMA. In August the end of month gold

price was $1648.5. Data for the value of other reserves are taken from IFS, table ‘Total Reserves minus Gold’.

28

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Gold Investment Symposium 2012 - Jake Klein - Evolution Mining

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