MMX: CREATING CHOICES IN SEABORNE IRON ORE SUPPLY. Rio de Janeiro January 2012

Transcription

1 MMX: CREATING CHOICES IN SEABORNE IRON ORE SUPPLY Rio de Janeiro January 2012

2 1 A UNIQUE STORY

3 3 INGREDIENTS FOR A SUCCESSFUL IRON ORE BUSINESS Guaranteed Logistics Competitive Cost Structure Owned Sudeste Superport at 50 Mtpy, expandable to 100 Mtpy, provides gateway to seaborne markets. Integrated infrastructure, with the existing MRS railway providing an efficient link between mine and port Strong Resource Base SRK certification: 3.1 billion tons of mineral resources, and further mineral potential of up to 1.4 billion tons Solid Financial Position Strong balance sheet and project fundamentals to attract competitive funding Current operations provide strong FCF Operational Track Record Experienced management team with implementation and operational expertise. Installed Capacity of 10 Mtpy (Serra Azul and Corumbá sites) Secured Offtake 64% of future production already committed through long-term contracts.

4 THE ONLY ONE OF ITS KIND MMX Uniqueness Production committed to important global consumers China and South Korea through long-term contracts Brownfield start up Expanding beyond 50 Mtpy in Brazil and Chile, through fully integrated systems: own deep water Chinamax enabled superports and pipelines Unique port location and strong balance sheet leverage significant value creation through consolidation of stranded iron ore resources in the Southeast of Brazil Strong cash generation Proven track record delivering value to shareholders Chile System Sudeste System Serra Azul Unit Bom Sucesso Unit Corumbá System Sudeste Superport Location

5 FINANCIAL HIGHLIGHTS EBITDA (R$ million) Sales (million ton) Q10 2Q11 3Q11* 0.0 3Q10 2Q11 3Q11 *excluding non recurent itens MI ME Net Profit (R$ million) Debt profile % (243.2) 3Q10 2Q11 3Q11 50% 0% 54% 63% 73% 46% 37% 27% 3Q10 2Q11 3Q11 Short Term Long Term

6 2 SUDESTE SYSTEM

7 UNIQUE INTEGRATED LOGISTICS Since Iron ore is a bulk commodity, an integrated logistic (mine railway port) is the key factor for a successful operation Mine Railway Superport Offtakers (Shareholders) Long-Term contract (20 years) to trade iron ore. SK will take-off part of the Sudeste System yearly production equivalent to its participation in MMX Capital (14%). Serra Azul unit is near to the MRS railway - 10 km from the mine, a distance currently traversed by trucks. MMX has a long term contract with MRS railway, which connects the mine with the CSN s Itaguaí port and to the Sudeste Superport. Sudeste Superport is located in Itaguaí and will have 50Mtpy iron ore shipping capacity. The Superport will have a depth of 20 meters, enough to handle Capesize vessels. Long-Term contract (20 years). Wisco will off-take at least 50% of MMX Sudeste production. SK and Wisco will together offtake 64% of total production

8 Iron ore Quadrangle QUADRILÁTERO FERRÍFERO

9 RAILWAY Railway access conecting MRS to the Sudeste Superport

10 SERRA AZUL Growth through consolidation while leveraging existing infrastructure

11 SERRA AZUL Serra Azul Unit Expansion Project Pit New Beneficiation Plant, transmission line and water pipelines, Stockyard and Loading Terminal

12 Serra Azul Expansion Beneficiation Plant

13 Sudeste Superport Location

14 Nautical Access Offshore Tunnel Stockyard 06 Stockyard 32 Sudeste Superport Artistic View Railway Access

15 SUDESTE SUPERPORT Overview Highlights 50 mtpy capacity, expandable to 100 mtpy Capesizes handling Loading: 2 ship loaders of 25 Mtpy each Fully funded (BNDES) Start-up forecast: 1Q13 100% of equipment already ordered Licensing for 100 Mtpy underway Sudeste Superport - Itaguaí

16 SUDESTE SUPERPORT Overview Highlights Tunnel: Meeting of the two excavation fronts as of September 2011 EIA-RIMA for 100 Mtpy filed with Inea in September Licensed to 50 Mtpy Navy Approval to 100 Mtpy Sudeste Superport - Itaguaí

17 Sudeste Superport Railway access

18 Sudeste Superport Stockyard Elevation 6 m

19 Sudeste Superport Car Dumpers Elevation 6 m

20 Sudeste Superport Mariquita Hill

21 Sudeste Superport Stockyard Elevation 32 m

22 11 m 20.5 m Sudeste Superport Tunnel entrance

23 Sudeste Superport Tunnel exit

24 Superporto Sudeste Offshore Structure - Bridge Bridge 450 m

25 Superporto Sudeste Offshore Structure Bridge and Pier Pier 766 m Bridge 250 m

26 Superporto Sudeste Offshore Structure Ilha da Madeira

27 SUDESTE SUPERPORT CAPEX and Funding CAPEX Funding: BNDES FINAME - PSI Total Amount: R$ mm Actual Forecast Interest Rate per Year: 4.50% 1,276 Amortization: 8 years Grace Period: 2 years Funding: BNDES FINEM Total Amount: R$ mm Interest Rate per Year: TJLP % Amortization: 10 years to 2013 Grace Period: 2 years Requested Supplementary Funding : R$ 552 million

28 SUDESTE SUPERPORT Construction schedule Preliminary License Construction LIcense Funding BNDES FINAME-PSI ANTAQ License Funding BNDES FINEM Civil Construction: 1S09 2S09 1S10 2S10 1S11 2S11 1S12 2S12 1S13 Stockyard 06 Stockyard 32 Tunnel Offshore Road-rail access Equipment sett up: Car dumpers Shiploader Stacker reclaimer Belt conveyor

29 Investor Relations Guilherme Escalhão CEO and CFO Camila Anker Manager Rafaela Gunzburger Analyst Beatriz Yoshinaga - Analyst Tel / 6338 ri@mmx.com.br