Stillwater Mining CompanyStillwater Mining Company

Stillwater Mining CompanyStillwater Mining Company

JP Morgan Small Cap ConferenceJP Morgan Small Cap ConferencePhiladelphia, PAPhiladelphia, PA

February 15February 15--16, 200616, 2006

Francis R. McAllisterFrancis R. McAllisterChairman and Chief Executive OfficerChairman and Chief Executive Officer

Forward Looking StatementForward Looking Statement

Some statements contained in this presentation are forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, therefore, involve uncertainties or risks that could cause actual results to differ materially. Additional information regarding factors which could cause results to differ materially is found in the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K.

The Company intends that the forward-looking statements contained herein be subjected to the above-mentioned statutory safe harbors. Investors are cautioned not to put undue reliance on forward-looking statements. The Company disclaims any obligation to update forward-looking statements.

LocationLocation

OperationsOperations

PGM ProductionPGM Production

5042237

492

12532

428

15624

405

164165

375

385

175

200

440

0

200

400

600

800

1,000

1,200

2001 2002 2003 2004 2005e

Stillwater Mine East Boulder Mine Recycling Pd Inventory

000 oz

Financial PerformanceFinancial Performance

99

54

10896

55

$368

$586

$385

$309

$353$467

$480$408

$454$554

0

50

100

150

200

2001 2002 2003* 2004 9/30/2005

-5 0

5 0

1 5 0

2 5 0

3 5 0

4 5 0

5 5 0

6 5 0

7 5 0

Combined Pd Pt average market price $/ozCombined Realized Pd Pt price $/oz mine production

EBITDA

* before impairment charge and other non-cash and transaction expenses

$ millions

2005 Operations Focus2005 Operations Focus

•• Continue to Advance Safety SystemsContinue to Advance Safety Systems•• Increase Developed StateIncrease Developed State•• Introduce Selective Mining MethodsIntroduce Selective Mining Methods•• Increase Production LevelsIncrease Production Levels•• Reduce CostsReduce Costs

Financial CapacityFinancial Capacity

•• At September 30, 2005At September 30, 2005–– Cash and cash investments Cash and cash investments –– $137.3 $137.3

millionmillion–– Drawn from Credit Facility Drawn from Credit Facility -- $116.6 $116.6

millionmillion–– Access to undrawn revolving credit Access to undrawn revolving credit --

$25.9 million$25.9 million•• Pd InventoryPd Inventory

–– Balance of 172,970 oz at Sept. 30 Balance of 172,970 oz at Sept. 30 expected to sell 440,000 oz in 2005expected to sell 440,000 oz in 2005

•• Net working capital $206.1 millionNet working capital $206.1 million

Palladium and Platinum Price Spread Palladium and Platinum Price Spread January 2004 to February 2006January 2004 to February 2006

500

550

600

650

700

750

800

850Ja

n-04

Feb-

04

Mar

-04

Apr-0

4

May

-04

Jun-

04

Jul-0

4

Aug-

04

Sep-

04

Oct

-04

Nov-

04

Dec-

04

Jan-

05

Feb-

05

Mar

-05

Apr-0

5

May

-05

Jul-0

5

Aug-

05

Aug-

05

Sep-

05

Oct

-05

Nov-

05

Jan-

06

Feb-

06

$ per oz

2005 Palladium Usage2005 Palladium Usage20066,950

7007,650

4,0001,8001,200

800300190

8,290

3006000

360

20077,000

8007,800

4,0002,0001,200

800300190

8,490

300000

300

20056,700

5007,200

4,0001,6001,200

800300190

8,090

260440

00

700

ProductionProductionCatalyst (scrap)Catalyst (scrap)TotalTotal

DemandDemandCatalystCatalystJewelryJewelryElectronicsElectronicsDentalDentalChemicalChemicalOtherOtherTotalTotal

StockStockRussiaRussiaStillwaterStillwaterUSDLAUSDLAAutoAutoTotalTotal

Surplus/DeficitSurplus/Deficit (140) (280) (390)

Source: Company estimates and various industry reports

Existing Palladium UsageExisting Palladium Usage

Auto Industry PGM PurchasesAuto Industry PGM Purchases

Source: Johnson Matthey Platinum 2004

Palladium Palladium -- In the MarketIn the Market

Hermes Purse Shaeffer Pen

S.T. Dupont

Watches

Palladium Palladium -- RediscoveredRediscovered•• Vintage Palladium Ads Vintage Palladium Ads –– 19401940’’ss

““Palladium Palladium –– The other white metalThe other white metal””•• Modern Jeweler, August 2005Modern Jeweler, August 2005

Professional JewelerProfessional Jeweler•• 12 articles to promote and educate palladium jewelry 12 articles to promote and educate palladium jewelry

manufacturing beginning in October 2005manufacturing beginning in October 2005

PalladiumPalladium –– UsageUsage

2003 2004 2005 2006

Mine Production (000 oz) 6,048 6,500 6,700 6,950

% of Production consumed 1% 11% 19% 26%

China Jewelry Demand

Pd O

unce

s ('0

00)

0200400600800

1000120014001600180020002200

2003 2004 2005 2006

Constant Growth Forecast Projections

PalladiumPalladium –– China Jewelry DemandChina Jewelry Demand

Jewelry Demand (000 oz)Jewelry Demand (000 oz)

2003 2004 2005 2006

Gold 6,500 7,200 7,250 7,300

Platinum 1,350 1,110 1,130 1,160

Palladium 55 710 1,200 1,300

Company estimates and various industry reportsCompany estimates and various industry reports

Why Palladium JewelryWhy Palladium Jewelry•• Easy to work withEasy to work with•• Strong, toughStrong, tough•• Lighter, allows larger Lighter, allows larger

jewelry piecesjewelry pieces•• NonNon--allergenicallergenic•• Exclusive and stylishExclusive and stylish

PalladiumPalladium –– Weight/Price AdvantageWeight/Price Advantage

•• An equivalent sized palladium jewelry An equivalent sized palladium jewelry article would be lighter by:article would be lighter by:–– 44%44%-- 45% than platinum 45% than platinum –– 35%35%-- 38% than 18 carat white gold38% than 18 carat white gold

•• An equivalent sized palladium jewelry An equivalent sized palladium jewelry article costs:article costs:–– 22% of 950 platinum, 22% of 950 platinum, –– 54%54%-- 57% of 18 carat white gold57% of 18 carat white gold

PalladiumPalladium –– MarginMargin

Jewelry Retailer Margins in ChinaPd 950 24K 18K Pt950

Retail Price $20.69 $15.89 $21.69 $32.31

Profit 13.00 1.78 7.24 3.75

Margin 62.8% 11.2% 33.4% 11.6%

Retailer (w/o labor charge)

Units: Dollars/Gram

WhyWhyStillwater Mining CompanyStillwater Mining Company

•• Highest grade PGM deposit in western worldHighest grade PGM deposit in western world•• Substantial palladium sourceSubstantial palladium source•• Palladium demand growth storyPalladium demand growth story•• Controlling shareholder in PGM businessControlling shareholder in PGM business•• Significant upside potentialSignificant upside potential

–– Increase recycling activitiesIncrease recycling activities–– Expand operationsExpand operations

•• Strong sales contract positionStrong sales contract position•• Experienced management teamExperienced management team•• Focused environmental/safety positionFocused environmental/safety position

ADDITIONAL SLIDESADDITIONAL SLIDES

2005 2005 –– First Nine Months First Nine Months Operating PerformanceOperating Performance

•• Net Loss $10.9 million or $0.12 per shareNet Loss $10.9 million or $0.12 per share•• Combined avg. realized price for mine Combined avg. realized price for mine

production $467 per oz.production $467 per oz.•• PGM mine production PGM mine production -- 411,000 oz at $321 411,000 oz at $321

per ounceper ounce–– 317,000 oz. palladium317,000 oz. palladium–– 94,000 oz. platinum94,000 oz. platinum

•• Stillwater Mine production 288,000 oz. Stillwater Mine production 288,000 oz. Total cash cost $310 per oz.Total cash cost $310 per oz.

•• East Boulder Mine production 123,000 oz. East Boulder Mine production 123,000 oz. Total cash cost $349 per oz.Total cash cost $349 per oz.

ResultsResults

29.8

65.8

31.7-10.9

$467

$368

$586

$385$309

$353

$480$408$454$554

-200

20406080

100120

2001 2002 2003* 2004 9/30/2005 -5 0

5 0

1 5 0

2 5 0

3 5 0

4 5 0

5 5 0

6 5 0

7 5 0

Combined Pd Pt average market price $/ozCombined Realized Pd Pt price $/oz mine production

* before impairment charge and other non-cash and transaction expenses

Income$ millions

Existing Sales ContractExisting Sales Contract

•• 3 primary customers 3 primary customers –– Ford, GM, MitsubishiFord, GM, MitsubishiPalladium Platinum

% Production Average Price % Production Average PriceFloor

2005 100% $355 80% $425

2006-2007 100% $339-$344 80%-70% $425

2008 80% $385 70% $425

2009 80% $380 70% $425

2010 80% $375 70% $425

Ceiling2005 31% $702 16% $856

2006 29% $721 16% $856

2007 17% $975 14% $850

2008-2010 20% $975 14% $850

2005 Operating Plan2005 Operating Plan

•• PGM mine production PGM mine production –– 550,000 550,000 ––570,00 oz.570,00 oz.–– 385,000 oz. 385,000 oz. –– Stillwater Mine avg. 1,900 tons/dayStillwater Mine avg. 1,900 tons/day–– 175,000 oz 175,000 oz –– East Boulder Mine avg. 1,375 East Boulder Mine avg. 1,375

tons/daytons/day

•• Total Cash costs Total Cash costs -- $315 $315 -- $320 per oz$320 per oz–– Stillwater Mine Stillwater Mine -- $300 per oz.$300 per oz.–– East Boulder Mine East Boulder Mine -- $350 per oz.$350 per oz.

•• Recycling Recycling –– 200,000oz. of PGMs200,000oz. of PGMs•• Inventory sales Inventory sales –– 440,000 oz. Palladium440,000 oz. Palladium

•• Capital expenditures Capital expenditures -- $100 m$100 m–– $60 m $60 m –– Stillwater MineStillwater Mine–– $40 m $40 m –– East Boulder MineEast Boulder Mine

Selective Mining Selective Mining -- 2005 2005 EffortsEfforts

•• Stillwater: Stillwater: –– 34,700 feet of primary development, 34,700 feet of primary development,

including 19,500 feet of FWLincluding 19,500 feet of FWL–– 465,000 feet of diamond drilling465,000 feet of diamond drilling

•• East Boulder: East Boulder: –– 16,849 of primary development, 16,849 of primary development,

including 11,500 feet of FWLincluding 11,500 feet of FWL–– 165,000 feet of diamond drilling 165,000 feet of diamond drilling

•• Capitalized Development cost of $62.3 Capitalized Development cost of $62.3 millionmillion

Selective MiningSelective Mining•• BenefitsBenefits

–– Increased ounces producedIncreased ounces produced–– Increased mining recovery of depositIncreased mining recovery of deposit–– Decreased secondary development Decreased secondary development

requirementrequirement

•• OpportunitiesOpportunities–– Adding ramp and fill mining to Upper West Adding ramp and fill mining to Upper West

at Stillwaterat Stillwater–– Increased convention (slusher) mining in Increased convention (slusher) mining in

OffOff--Shaft area at Stillwater (including Alimak Shaft area at Stillwater (including Alimak mining)mining)

–– Increasing ramp and fill at East BoulderIncreasing ramp and fill at East Boulder–– Adding conventional mining at East BoulderAdding conventional mining at East Boulder