MGX RESOURCES LIMITED — AGM Information 2013

Nov 12, 2013

Annual General Meeting

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Disclaimer

This Document is Confidential and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person, or published, in whole or in part, for any purpose without prior written approval from Mount Gibson Iron Limited.

This Document is not a Prospectus nor an Offer to Subscribe for Shares.

Mount Gibson Iron Limited and its subsidiaries (ASX:MGX, “ MGX ”) makes no representations or warranty (express or implied) as to the accuracy, reliability or completeness of this document. MGX and its respective directors, employees, agents and consultants shall have no liability (including liability to any person by reason of negligence or negligent misstatement) for any statements, opinions, information or matters (expressed or implied) arising out of, or contained in or derived from, or for any omissions from this document, except liability under statute that cannot be excluded.

This document contains reference to certain forecasts, projections, intentions, expectations and plans of MGX, which may or may not be achieved. They are based on certain assumptions which may not be met or on which views may differ.

The performance and operations of MGX may be influenced by a number of factors, uncertainties and contingencies many of which are outside the control of MGX and its directors.

No representation or warranty (expressed or implied) is made by MGX or any of its respective directors, officers, employees, advisers or agents that any forecasts, projections, intentions, expectations or plans set out in this document will be achieved, either totally or partially, or that any particular rate of return will be achieved.

Investments in shares in MGX is considered highly speculative.

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Our Business

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Koolan Island Mine

• Premium DSO lump and fines

• Ramping up to 4 Mtpa by end 2014

• • Long life asset with dedicated shiploader Mid West Region

• Tallering Peak, Extension Hill & Geraldton Port facilities

• Tallering Peak Mine Extension Hill Mine • • Mine life extended Low cost 3 Mtpa to mid 2014 operation

• • • Targeting ~2.5 Mt High potential DSO sales in near-mine and FY2014 regional exploration targets

Upgrades to Geraldton port and rail infrastructure have doubled MGX export capacity from the Mid West to 6Mtpa

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FY2013 in Review

Strong

• Record ore sales of 8.8 Mwmt, up 68%

• Cash increased 28% to $376m at 30 June 2013

• Record sales revenue of $852.9m, up 32%

operating

• Net profit after tax of $157.3m

• Net operating cash flow up 220% to $179.7m

and financial

performance

• Fully franked full year payout 4.0 cps maintained

• • $130m in dividends paid since Sept 2011

• Minimal debt

• Increased total Ore Reserves to 45Mt @ 62.1%Fe*

Key underlying achievements

• Completed executive team rebuild

• Achieved permanent ongoing savings of ~$50m per annum

• Optimised and implemented detailed Koolan Island ramp-up plan to 4 Mtpa

• Reduced Koolan Island unit mining costs to ~$8/t moved in Sept Qtr 2013, ~$6/t lower

• than in Sept Qtr 2012

• Commenced Acacia East pit development at Koolan Island

• Ramped-up Extension Hill sales and logistics chain to maximum capacity

• Extended Tallering Peak life by a year, T1 defined and developed in under 18 months

• Rejuvenated exploration strategy and increased landholding by ~70% to 630 sqkm

Sales profile and growth strategy

Ore sales history and indicative outlook

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Actual Forecast
Stage Two
8 growth
Stage One
growth
6
Ore Sales
(Mwmt)
4
2
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year to 30 June
FY'14 guidance 9.0 - 9.5 Mt Ext. Hill Koolan Is. Tallering Pk.
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*Forecast ore sales are indicative only, and include all products except lower grade ore from Extension Hill stockpiles, which totalled 1.9Mt at 30 Sept 2013 with a further 2.4Mt to be stockpiled over the mine life. Actual future sales remain subject to future mine performance, continuous optimisation, exploration success and general market factors.

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High potential to extend in the Mid West

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N
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• Extension Hill South DSO targets located 1-3km from existing crusher, with known mineralisation

• Initial drilling approval received for Extension Hill South in late September

• Iron Hill prospect drilling to commence this quarter

• Field’s Find located 60km north of Extension Hill, drilling commenced late October

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3km
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Field’s
Find
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Koolan Island - a quality asset with upside

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1km
West End
exploration
N
targets
Main Pit
8
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Positive outlook for FY2014

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In the short term…

• ore inventories at Chinese ports remain low and have not recovered from destocking in 2012

• Chinese steel mill production remains at historic highs

• Chinese economic growth is forecast to remain healthy at ~7% pa on a larger base

• potential for substantial short term destocking is limited

And in the long term…

• the outlook for underlying iron ore demand growth remains healthy

• planned supply side increases historically take much longer and deliver smaller volume increases than originally proposed

• the Australian dollar is expected to continue to soften towards a long term average of ≤US$0.90

• MGX will benefit from comparatively stronger A$ iron ore prices and lower A$ costs

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Off to a strong start in FY2014

• Cash increased to $420m at 30 Sept

Robust

• Group ore sales increased to 2.6 Mwmt

• Koolan sales increased to 1.1 Mwmt

Sept Quarter

• Mid West sales of 1.5 Mwmt

• On track to achieve 9.0 – 9.5 Mwmt in FY14

performance

• Healthy Chinese growth outlook

• Platts iron ore price @ ~US$130/t CFR (62%Fe)

• AUD @ US$0.95 with potential to ease

Summary

• One of Australia's best performing mid-tier iron ore miners with multiple operations in Western Australia

• Exporting 9.0-9.5 million tonnes of quality iron ore to China in FY2014

• Strong operating cashflows and balance sheet

• Current market capitalisation of ~A$1 billion

• Established transport infrastructure and long term customer contracts

• Exploration upside and disciplined growth strategy

• Experienced management team with demonstrated capacity to:

• Optimise and drive operations to extract maximum value

• Reduce costs and eliminate inefficiencies

• Bring on new deposits in quick time

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Thank you Thank You

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Supplementary information

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275
Relative share price performance
ASX listed iron ore companies
250
Mount Gibson Iron
225
200
175
25 June 2013
S&P/ASX 200 Resources
150 index at a 4 year low
125
100
75
50
Jun-13 Jul-13 Aug-13 Sep-13 Oct-13
Mount Gibson Iron Peer A Peer B Peer C Peer D Peer E
Source: IRESS.
Note: Market data as at 12 November 2013.
Share price (indexed to 100)
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Supplementary information Appendix – Reserves and Resources

Mineral Resources and Ore Reserves at 30 June 2013

Koolan Island
	Tonnes	Fe	SiO2	Al2O3	P
	millions	%	%	%	%
Mineral Resources above 50% Fe
Measured	8.4	59.7	12.72	1.14	0.02
Indicated	44.6	64.5	6.21	0.77	0.01
Inferred	15.4	60.7	12.15	0.60	0.01
Total	68.5	63.0	8.35	0.78	0.01
Ore Reserves, above 50% Fe
Proved	4.2	59.5	14.18	0.37	0.01
Probable	26.0	64.8	5.70	0.82	0.01
Total	30.2	64.0	6.89	0.76	0.01
Extension Hill
	Tonnes	Fe	SiO2	Al2O3	P
	millions	%	%	%	%
Mineral Resources above 50% Fe
Measured Indicated	10.5 4.1	58.0 58.1	6.50 9.06	2.24 1.61	0.06 0.07
Inferred	0.3	52.9	10.71	5.46	0.05
Total	14.8	57.9	7.28	2.12	0.06
Ore Reserves, above 50% Fe
Proved Probable Total Tallering Peak	9.7 3.1 12.8 Tonnes millions	58.1 58.9 58.3 Fe %	6.54 8.92 7.12 SiO2 %	2.18 1.23 1.96 Al2O3 %	0.06 0.06 0.06 P %
Mineral Resources above 50% Fe
Measured	2.0	60.0	5.53	3.27	0.04
Indicated	3.1	57.9	10.12	2.40	0.05
Inferred	0.3	54.7	15.56	2.99	0.05
Total	5.4	58.5	8.72	2.76	0.04
Ore Reserves, above 50% Fe
Proved	0.5	59.8	6.39	2.91	0.05
Probable	1.6	58.1	10.93	1.88	0.04
Total	2.1	58.5	9.81	2.14	0.04
NOTE: Discrepancies may appear due to rounding.		Mineral Resources are reported inclusive of Ore
Reserves.

Total Group Mineral Resources and Ore Reserves at 30 June 2013

Total Group Mineral	Resources	and Ore	Reserves at 30 June	Reserves at 30 June	2013
(above 50% Fe)	Tonnes millions	Fe %	SiO2 %	Al2O3 %	P %
Mineral Resources	88.6	61.9	8.19	1.12	0.02
Ore Reserves	45.2	62.1	7.09	1.16	0.03
NOTE: Discrepancies may appear due to rounding. Mineral			Resources are	reported inclusive of
Ore Reserves.

Attributions

The information in this report that relates to Exploration Results is based on information compiled by Gregory Hudson, who is a member of the Australian Institute of Geoscientists. Gregory Hudson is an employee of Mount Gibson Iron Limited group, and has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration and to the activity he is undertaking, to qualify as a Competent Person as defined in the December 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Gregory Hudson has consented to the inclusion of the matters in this report based on his information in the form and context in which it appears.

The information in this report relating to Mineral Resources is based on information compiled by Elizabeth Haren, who is a member and Chartered Professional of the Australasian Institute of Mining and Metallurgy. Elizabeth Haren has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Elizabeth Haren consents to the inclusion in the report of the matters based on her information in the form and context in which it appears. Elizabeth Haren was a full-time employee of, and is a consultant to Mount Gibson Mining Limited. The Mineral Resource estimate complies with recommendations in the Australian Code for Reporting of Mineral Resources and Ore Reserves (2012) by the Joint Ore Reserves Committee (JORC). Therefore it is suitable for public reporting.

The information in this report relating to Ore Reserves is based on information compiled by Weifeng Li, who is a member of the Australasian Institute of Mining and Metallurgy. Weifeng Li has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Weifeng Li consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Weifeng Li is a consultant to Mount Gibson Mining Limited.

Refer ASX release 21 October 2013 for full details of Mineral Resources and Ore Reserves.

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