Hochschild Mining plc GOLD FORUM_FINAL.… · Denver Gold Forum 2017. DISCLAIMER 2 Some statements contained in this presentation or in documents referred to in it are or may be forward-looking

Hochschild Mining plcDenver Gold Forum 2017

DISCLAIMER

2

Some statements contained in this presentation or in documents referred to in it are or may be forward-looking statements.Any forward-looking information contained in this presentation has been prepared on the basis of a number of assumptionswhich may prove to be incorrect. Accordingly, actual results may vary or differ from those expressed in such statements,depending on a variety of factors. Forward-looking statements speak only as of the date on which they are made.Hochschild Mining plc undertakes no obligation to update or revise any forward-looking statement, whether as a result ofnew information, future events or otherwise.

Past performance of the Company or its shares cannot be relied on as a guide to future performance. Nothing in thispresentation is to be construed as a profit forecast.

This presentation has been prepared solely for informational purposes and does not constitute, or form part of or containany invitation or offer to any person to underwrite, subscribe for, otherwise acquire, or dispose of any securities issued byHochschild Mining plc (or any subsidiary thereof) or advise persons to do so in any jurisdiction, nor shall it, or any part of it,form the basis of or be relied on in any connection with or act as an inducement to enter into any contract or commitmenttherefore. The information herein is only a summary, does not purport to be complete and has not been independentlyverified. No representation or warranty, either express or implied, is made as to, and no reliance may be placed for anypurpose whatsoever on the information or opinions contained in this document or on its accuracy or completeness and noliability whatsoever is accepted for any loss howsoever arising from any use of this document or its contents otherwise inconnection therewith.

This presentation has been prepared in compliance with English law and English courts will have exclusive jurisdiction overany disputes arising from or connected with this presentation.

Strong portfolio + operational experience + financial stability + exciting growth=

Shareholder value

Brownfield potential at all operations

Developing greenfield portfolio

HOCHSCHILD AT A GLANCE

3

A leading Latin American precious metal producer

+100yrs of history and +50yrs of mining

Operational Experience

Key Inmaculada flagship asset

Low cost competitive position

Strong portfolio

Growth potential

Peru Argentina Chile

Southern Peru Cluster

ArcataInmaculadaPallancata

San Jose

Volcan

Delivering 85% production growth and 50% cost reduction

CORE ASSETS: FIVE YEARS OF TRANSFORMATION

4

2012 2013 2014 2015 2016 2017e

Silver Gold

35.5

27.0

Attributable production (m oz Ag Eq)

All-in sustaining costs($/oz Ag Eq)

20.5 22.220.3

*2015-2017e using gold/silver ratio of 74x to convert gold to silver equivalent. Ratio of 60x used for 2012-2014.

37.0

21.7 18.6 17.4

12.9 11.2 12.2-12.7

2012 2013 2014 2015 2016 2017e

(H1: 17.9)

(H1: 12.0)

Strong operational track record

5

OPERATIONAL OVERVIEW

• Low-cost flagship Inmaculada mine delivering strong

cashflow

• Pallancata starting to benefit from Pablo upgrade – 2017

production forecast increased to 7.5m oz

• San Jose delivering consistent production

• Arcata aiming to maximise productivity in narrower vein

stopes and focusing on overall cost control

• Significant spare plant capacity in Peru

• H2 2017 drilling for further resources at Ares – 1,000tpd

plant available

0

500

1,000

1,500

2,000

2,500

3,000

Arcata Pallancata Ares

Pablo1,400

Current1,000

Spare600

Spare600

Current1,500

Spare1,000

67%

40%

100%

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Source: SNL

Inmaculada(H1: $651/oz)

2017 Gold all-in sustaining cost curve($/oz)

Spare plant capacity opportunities(tonnes per day)

GROWTH STRATEGY

Focus on exploration-led growth

6

Brownfield programme

Greenfield

Joint ventures

• Progressing drill-ready projects• Staking opportunities• Optimising early stage projects

• Early-stage• Earn-in JVs• Geological upside• ROIC:12-15%

• Spare capacity available• LOM increases• Capacity expansions

1

2

3

EXPLORATION: PROVING INMACULADA’S GEOLOGICAL UPSIDE

7

Additional resources and strong potential for future expansion and LOM increase

• Mine development, combined with regional geology added 10m Ag Eq resources in H1 2017

• H2 2017:

― Drilling to confirm potential of Millet & other veins

― 7,200m potential drilling to east of Inmaculada & Puquiopata

• Angela vein still open along strike

• Several satellite veins to main Angela oreshoot

3,500 3,850 4,200 5,000

INMACULADA: PLANT EXPANSION POTENTIAL

• Significant production upside

• Lower AISC

• Low capex estimates for expansion

― 4,200tpd ≈ $10m

― 5,000tpd ≈ $50m

• Initial modular construction allows relatively

simple capacity increases

• Additional resources will be required to avoid

LOM reduction

8

Production uplift

Current

Small investment required to materially increase capacity

Tonnes per day

PABLO CLOSE TO PRODUCTION

9

Pablo has opened up a new district

• Government permit expected in Q4

• Mine development largely complete –

grade better than expected

• Smooth ramp-up to 2,400 tpd expected

• Geological upside from recently

discovered Marco vein – 1moz Ag Eq

added to date

• Pablo resources 40m oz Ag Eq

• Grade up by 44% (Ag Eq) since 2015

• Ongoing drilling to convert existing

resources at Pablo into reserves

EXPLORATION: CHANGING THE PICTURE AT PALLANCATA

10

• Pablo & Pablo Pisos discovered in 2015/2016

• Grades consistently surprising to the upside

• Mapping at outcropping Cochaloma vein to south west of Pablo

Opening up a new district: reinterpreting & reinvigorating Pallancata

• Geophysics/mapping show two targets similar to Pablo:―Pallancata South―Farallon

• Both to be tested in 2018 - subject to permits

EXPLORATION: ARCATA 2017

• Geological understanding of complex dispersed vein deposit has evolved

• Significant resource & potential drilling ongoing in 2017

• Approx. 4.7m oz of Ag Eq resources discovered from conventional drilling ytd

• Long horizontal drilling started – first results due in H2

• Focused on Alexia, Macarena East, Tunels 2,3 and 4, Tres Reyes, Luisa and Marciano structures

Aiming to improve resource quality and lower long-term cost position

11

0

3,000

6,000

9,000

12,000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

(k oz Ag Eq)

Arcata’s historic production has been volatile but brownfield discoveries have often reinvigorated the mine

EXPLORATION: SAN JOSE 2017

12

• Following initial drilling - additional geophysics carried out at Aguas Vivas in North West

• Further drilling at Aguas Vivas and other targets planned for H2

• Coeur Mining land package between San Jose and Cerro Negro recently acquired

Bloque Aguas Vivas

Testing initial results at Aguas Vivas

GoldcorpCerro Negro

>7m oz Au EqAcquired 2010

C$3.6bn

Coeur land acquisition

Aiming to drill prospective geology in good geography

GREENFIELD PROGRAMME

13

Generating and advancing new greenfield opportunities

Deposit type

• Targeting skarns, epithermal veins and porphyries

Peru

• Portfolio reshuffled with promising targets generated• Five prospects selected: Fresia (drilling in 2017), Alto

Ruri, Corina, Casma, Cueva Blanca

Outside Peru

• Earn-in JVs/options from juniors with:― known districts― clear evidence of mineralisation― straightforward objectives

• Jurisdictions with geological potential, political & regulatory stability, e.g. Chile, US, Canada, Mexico

Two deals announced

• Loro (Chile)― 4km of veins similar to nearby El Penon outcrop on discovery― Evidence of emerging epithermal vein system

• Cobalt Silver District (Canada)― Alliance established with Cobalt Power Group ― Historic production of silver/cobalt in Ontario

Peru

Fresia

Alto Ruri

Corina

Casma

Cueva Blanca

Loro (Chile)

Cobalt Silver District (Ontario, Canada)

VOLCAN LONG-TERM OPTIONALITY

14

A next major gold region in Northern Chile?

Cerro Maricunga(Atacama Pacific)

Maricunga(Kinross)

Volcan

Cerro Casale(Barrick/Goldcorp)

Caspiche(Barrick/Goldcorp)

Lobo Marte (Kinross)

La Coipa (Kinross)

Relincho(Goldcorp/Teck)

El Morro(Goldcorp/Teck)

Chile

Argentina

Caserones(Pan Pacific Copper, Mitsui)

Mantoverde(Audley Capital, Orion Resource)

Candelaria(Lundin Mining, Sumitomo)

Copiapo

Gold deposit

Copper deposit

20km

• Large gold deposit in the Maricunga region in

Northern Chile

• Water rights secured

• Acquired as future strategic resource

• 9.5m oz of gold resources

• Stable mining jurisdiction

• Barrick/Goldcorp/Kinross already in area

DEBT REDUCTION PROGRAMME ON TRACK

15

• $250m gross debt repaid in 2015-2017 (ytd)

• Net debt improved from $351m in Dec 2015 to

$165m as at 30 June 2017

• Net Debt/LTM EBITDA has improved from 5.8x to

<0.6x

• Only remaining major debt: $295m 2021 Bonds

callable starting Jan 2018

― Working on refinancing alternatives

84 84 103140 145

540

434

369328 309

Jun-15 Dec-15 Jun-16 Dec-16 Jun-17

Cash

Gross debt

Net debt/EBITDA

Balance sheet progression($m)

Strong position to assess refinancing options

5.8x

2.5x

1.0x

0.57x0.56x

Interest payment reduction*($m)

3028

25

7

3

Dec-15 Dec-16 Dec 17e Dec 18e Dec-19

*P&L pre-exceptional interest payments. Dec 2017 interest payment estimate calculated using H1 2017 annualised. Dec 2018 estimate calculated assuming Jan 2018 repayment and refinancing of $295m senior notes at current available market rates.

VALUATION REMAINS COMPELLING

16

-1%-1% 0%

1% 1% 2%4%

7%10%

8%

0%

3% 3%

11%

1%

11%16%

9%

15%

5%8%

10%

6%

15%

Tahoe First Majestic Coeur Fresnillo Pan American Hecla SSR HOC

Free cashflow yield (%)2017 2018 2019

5.8 5.9 6.6 8.9 9.7

10.9 11.0 13.5

3.4 5.0

7.2 6.4 5.1

6.9 9.1

4.5 2.7 3.4 4.9

3.65.3

6.47.9

4.6

Tahoe HOC SSR Coeur Hecla Pan American Fresnillo First Majestic

EV/EBITDA (x)

2017 2018 2019

Source: BMO, “The Silver Pages”, 18 September 2017”

27.431.2 33.2 35.7

39.2 42.1

50+ 50+

22.728.2 23.8 23.5 23.6

14.2

50

16.118.8

26.9

13.425.0 26.2

17.3 19.7

27.5

SSR Fresnillo HOC Tahoe Pan American Hecla Coeur First Majestic

P/E (x)2017 2018 2019

AN ONGOING VALUE PROPOSITION

17

Production track record

Record in 2016; on course for another in 2017

Efficient cost structure

Ongoing focus on costs and capital efficiency

Brownfield growth

H2 drilling metres to be double H1

Pablo driving further growth

Geological upside proving to be material

Growth programme

Generating and advancing new opportunities

Financial strength

Debt reduction ahead of schedule; $21m of dividends since H1 2016

Hochschild Mining plcAppendix

Inmaculada San Jose Arcata Pallancata

Production*

37moz Ag Eq

Attrib

7.5

5.5

7.0

17.0

*Using gold/silver ratio of 74x to convert gold to silver equivalent**Operating expenditure amounts to $20m and capital expenditure amounts to $2m

Overall AISC guidance unchanged

19

2017 CORE ASSET GUIDANCE

Revised AISC forecast by mine

• Increase at Arcata

• Small increase at San Jose

$/oz Ag

45

35

20

25

Inmaculada San Jose Arcata Pallancata

Sustaining & development capex

$120-130m

2

3

51

5

5

Inmaculada San Jose ArcataPallancata Greenfield Personnel

Exploration

$22m**

Offset by reduction at Pallancata

Inmaculada

Original guidance

Revised guidance

9.5-10.0 9.5-10.0

San Jose

12.8-13.313.5-14.0

Pallancata

14.2-14.7

Arcata

15.3-15.8 17.0

HOC operations12.0

12.2-12.7

Peru

CORE ASSETS: INMACULADA

Hochschild’s flagship low cost operation

20

Summary Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Q1 2016

Ore production (tonnes treated) 330,393 282,959 344,199 343,247 338,630 280,530

Average grade gold (g/t) 3.80 4.33 4.26 4.09 4.42 4.05

Average grade silver (g/t) 148 135 134 132 142 121

Gold produced (koz) 38.03 41.79 41.03 42.48 45.18 34.02

Silver produced (koz) 4,219 1,239 1,220 1,318 1,396 974

Gold equivalent (koz) 57.01 58.53 57.51 60.29 64.04 45.83

P&P Reserves (m oz Au Eq)

M&I Resources (m oz Au Eq)

1.2 1.4

Inferred Resources (m oz Au Eq)

Production (H1 2017) (oz)

0.5 79,820 Au

2.6m Ag

Unit cost (H1 2017)

($/t)

AISC (H1 2017)

($/oz Au Eq)

84.8 651

• 100% owned• Located in Southern Peru Cluster• Started in 2015• 20,000 ha site• 4,400m ASL• Underground operation• Conventional/mechanised (trackless) cut-and-fill• Plant capacity: 3,850tpd• Product: 70% gold/30% silver dore

Peru

CORE ASSETS: PALLANCATA

Transitioning to the Pablo vein during H2 2017

21

Summary Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Q1 2016




Silver produced (koz) 1,475 964 317 1,030 658 615


Silver equivalent (koz) 1,912 1,252 426 1,365 903 841

P&P Reserves (m oz Ag Eq)

M&I Resources (m oz Ag Eq)

18.0 30.0

Inferred Resources (m oz Ag Eq)


53.7 2.3m Ag

8,040 Au

Unit cost (H1 2017)

($/t)

AISC (H1 2017)

($/oz Ag Eq)

106.3 10.9

• 100% owned• Located in Southern Peru Cluster• Started in 2007• 15,915 ha site• 4,600m ASL• Underground operation• Conventional/mechanised (trackless) cut-and-fill• Plant capacity: 3,000tpd• Product: 75% silver/25% gold conc

Argentina

CORE ASSETS: SAN JOSE

Strong cashflow improvement in 2016/2017

22

Summary Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Q1 2016




Silver produced (koz) 1,581 1,463 1,704 1,855 1,770 1,362


Silver equivalent (koz) 3,465 3,029 3,624 3,747 3,635 2,715



57.6 114.7



29.2 3.0m Ag

46,620 Au

Unit cost (H1 2017)

($/t)

AISC (H1 2017)

($/oz Ag Eq)

251.6 14.4

San Jose

• 51% owned. McEwen Mining has 49%• Located in Santa Cruz, Argentina• 50,491 ha site• Started in 2007• Underground operation• Conventional/mechanised (trackless) cut-and-fill• Plant capacity: 1,650tpd• Product: 50% silver/50% gold; 50% conc/50% dore

Peru

CORE ASSETS: ARCATA

Operating for +50 years and still good potential

23

Summary Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Q1 2016




Silver produced (koz) 1,138 1,165 1,669 1,705 1,592 1,377


Silver equivalent (koz) 1,427 1,471 2,101 2,174 2,013 1,724



17.7 48.1



56.1 2.3m Ag

8,040 Au

Unit cost (H1 2017)

($/t)

AISC (H1 2017)

($/oz Ag Eq)

119.7 17.6

• 100% owned• Located in Southern Peru Cluster• Started in 1964• 47,000 ha site• 4,600m ASL• Underground operation• Conventional/mechanised cut-and-fill• Plant capacity: 2,000tpd (2017: 1,500tpd)• Product: 80% silver/20% gold conc

ATTRIBUTABLE METAL RESERVES AS AT 31 DECEMBER 2016

Reserve category1 Proved and

probable (t)

Ag (g/t)

Au (g/t)

Ag (moz)

Au (koz)

Ag Eq(moz)

Arcata Proved 479,515 371 1.1 5.7 17.3 7.0Probable 811,996 327 1.1 8.5 29.7 10.7Total 1,291,511 343 1.1 14.3 47.0 17.7InmaculadaProved 3,254,366 144 3.9 15.1 412.7 45.7Probable 2,568,907 182 4.7 15.0 388.9 43.8Total 5,823,274 161 4.3 30.1 801.6 89.4PallancataProved 632,793 477 2.0 9.7 40.8 12.7Probable 371,752 331 1.4 4.0 17.2 5.2Total 1,004,545 423 1.8 13.7 58.0 18.0San Jose Proved 593,089 502 7.3 9.6 139.9 19.9Probable 333,455 401 6.6 4.3 70.4 9.5Total 926,544 465 7.1 13.9 210.4 29.4Proved 4,959,763 252 3.8 40.1 610.7 85.3Probable 4,086,111 242 3.9 31.8 506.2 69.2TOTAL 9,045,874 247 3.8 71.9 1,116.9 154.5

Note: Where reserves are attributable to a joint venture partner, reserve figures reflect the Company’s ownership only. Includes discounts for ore loss and dilution.1 Operations were audited by P&E Consulting.

24

Ore reserves and mineral resources estimatesHochschild Mining plc reports its mineral resources and reserves estimates in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves 2004 edition (“the JORC Code”). This establishesminimum standards, recommendations and guidelines for the public reporting of exploration results and mineral resources and reserves estimates. In doing so it emphasises the importance of principles of transparency, materiality andconfidence. The information on ore reserves and mineral resources were prepared by or under the supervision of Competent Persons (as defined in the JORC Code). Competent Persons are required to have sufficient relevant experience andunderstanding of the style of mineralisation, types of deposits and mining methods in the area of activity for which they are qualified as a Competent Person under the JORC Code. The Competent Person must sign off their respective estimatesof the original mineral resource and ore reserve statements for the various operations and consent to the inclusion of that information in this report, as well as the form and context in which it appears.Hochschild Mining plc employs its own Competent Person who has audited all the estimates set out in this report. Hochschild Mining Group companies are subject to a comprehensive programme of audits which aim to provide assurance inrespect of ore reserve and mineral resource estimates. These audits are conducted by Competent Persons provided by independent consultants. The frequency and depth of an audit depends on the risks and/or uncertainties associated withthat particular ore reserve and mineral resource, the overall value thereof and the time that has lapsed since the previous independent third-party audit.The JORC Code requires the use of reasonable economic assumptions. These include long-term commodity price forecasts (which, in the Group’s case, are prepared by ex-house specialists largely using estimates of future supply and demandand long-term economic outlooks).Ore reserve estimates are dynamic and are influenced by changing economic conditions, technical issues, environmental regulations and any other relevant new information and therefore these can vary from year-to-year. Mineral resourceestimates can also change and tend to be influenced mostly by new information pertaining to the understanding of the deposit and secondly the conversion to ore reserves.The estimates of ore reserves and mineral resources are shown as at 31 December 2016, unless otherwise stated. Mineral resources that are reported include those mineral resources that have been modified to produce ore reserves. Alltonnage and grade information has been rounded to reflect the relative uncertainty in the estimates; there may therefore be small differences. The prices used for the reserves calculation were: Au Price: US$1,200 per ounce and Ag Price:US$16.5 per ounce.

ATTRIBUTABLE METAL RESOURCES AS AT 31 DECEMBER 2016

Resource category Tonnes (t)

Ag (g/t)

Au (g/t)

Ag Eq(g/t)

Ag (moz)

Au (koz)

Ag Eq(moz)

ArcataMeasured 1,109,214 414 1.25 506 14.8 44.7 18.1Indicated 1,942,187 385 1.29 481 24.0 80.7 30.0Total 3,051,401 395 1.28 490 38.8 125.4 48.1Inferred 4,030,857 341 1.25 433 44.1 162.1 56.1Inmaculada1

Measured 2,977,597 178 4.83 535 17.0 462.7 51.2Indicated 2,635,187 219 5.58 632 18.6 473.0 53.6Total 5,612,784 197 5.19 581 35.6 935.7 104.8Inferred 3,165,478 133 3.37 383 13.6 343.3 39.0PallancataMeasured 1,052,621 453 1.92 596 15.3 65.1 20.2Indicated 693,465 332 1.45 439 7.4 32.4 9.8Total 1,746,086 405 1.74 534 22.7 97.5 30.0Inferred 3,637,800 357 1.37 459 41.8 160.7 53.7San JoseMeasured 840,329 564 8.20 1,171 15.2 221.6 31.6Indicated 964,641 404 6.26 867 12.5 194.1 26.9Total 1,804,970 479 7.16 1,009 27.8 415.7 58.5Inferred 529,566 404 6.40 878 6.9 109.0 14.9

25

Resource categoryTonnes

(t)Ag

(g/t)Au

(g/t)Zn (%)

Pb(%)

Cu (%)

Ag Eq(g/t)

Ag (moz)

Au (koz)Ag Eq(moz)

Zn (kt)

Pb(kt)

Cu (kt)

CrespoMeasured 5,211,058 47 0.47 - - - 82 7.9 78.6 13.7 - - -Indicated 17,298,228 38 0.40 - - - 67 21.0 222.5 37.4 - - -Total 22,509,286 40 0.42 - - - 71 28.8 301.0 51.1 - - -Inferred 775,429 46 0.57 - - - 88 1.1 14.2 2.2 - - -AzucaMeasured 190,602 244 0.77 - - - 301 1.5 4.7 1.8 - - -Indicated 6,858,594 187 0.77 - - - 243 41.2 168.8 53.7 - - -Total 7,049,197 188 0.77 - - - 245 42.7 173.5 55.5 - - -Inferred 6,946,341 170 0.89 - - - 236 37.9 199.5 52.7 - - -VolcanMeasured 105,918,000 - 0.738 - - - 55 - 2,513.1 186.0 - - -Indicated 283,763,000 - 0.698 - - - 52 - 6,368.0 471.2 - - -Total 389,681,000 - 0.709 - - - 52 - 8,882.7 657.3 - - -Inferred 41,553,000 - 0.502 - - - 37 - 670.7 49.6 - - -Other Projects1

Measured 1,393,716 69 0.02 7.12 3.10 0.39 315 3.1 0.9 14.1 99.3 43.1 5.5

Indicated 1,354,261 82 0.06 6.14 2.73 0.31 295 3.6 2.4 12.9 83.2 37.0 4.2

Total 2,747,977 76 0.04 6.64 2.92 0.35 305 6.7 3.3 27.0 182.4 80.1 9.7

Inferred 13,445,001 8 0.30 0.58 0.21 1.22 160 3.4 128.6 69.0 77.8 28.5 163.6

GRAND TOTALMeasured 118,693,138 20 0.89 0.08 0.04 0.00 88 74.8 3,391.5 336.8 99.3 43.1 5.5

Indicated 315,509,563 13 0.74 0.03 0.01 0.00 69 128.3 7,541.9 695.5 83.2 37.0 4.2

Total 434,202,700 15 0.78 0.04 0.02 0.00 74 203.1 10,934.9 1,032.3 182.4 80.1 9.7Inferred 74,083,472 62 0.75 0.10 0.04 0.22 142 148.9 1,788.0 337.3 77.8 28.5 163.6

1. Includes the Jasperoide copper project and the San Felipe zinc/silver project. The silver equivalent grade (147 g/t Ag Eq) has being calculated applying the following ratios, Cu/Ag=96.38 and Au/Ag=60

ATTRIBUTABLE METAL RESOURCES AS AT 31 DECEMBER 2016 (continued)

26

17 Cavendish Square, London, W1G 0PH,Tel: +44 (0) 20 3709 3260www.hochschildmining.com

Charlie Gordon+44 (0)20 3709 [email protected]

mailto:[email protected]

Documents

Hochschild Mining plc GOLD FORUM_FINAL.… · Denver Gold Forum 2017. DISCLAIMER 2 Some statements contained in this presentation or in documents referred to in it are or may be forward-looking