SANDFIRE RESOURCES LIMITED — Interim / Quarterly Report 2021

Feb 24, 2021

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December 2020 Half Year Financial Results Presentation

25 February 2021

Access this presentation by clicking here or on the Sandfire website www.sandfire.com.au

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Important Information and Disclaimer Important Information and Disclaimer

This presentation has been prepared by Sandfire Resources Ltd ( Sandfire or the Company ) and contains information about Sandfire current at the date of this presentation. The presentation is in summary form, has not been independently verified and does not purport to be all inclusive or complete. The Company is not responsible for providing updated information and assumes no responsibility to do so. Recipients should conduct their own investigations and perform their own analysis in order to satisfy themselves as to the accuracy and completeness of the information, statements and opinions contained in this presentation.

This presentation is for information purposes only. Neither this presentation nor the information contained in it constitutes an offer, invitation, solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction and may not be distributed in any jurisdiction except in accordance with the legal requirements applicable in such jurisdiction. Recipients should inform themselves of the restrictions that apply in their own jurisdiction. A failure to do so may result in a violation of securities laws in such jurisdiction.

This presentation does not constitute investment advice and has been prepared without taking into account the recipient's investment objectives, financial circumstances or particular needs and the opinions and recommendations in this presentation are not intended to represent recommendations of particular investments to particular persons. Recipients should seek professional advice when deciding if an investment is appropriate. All securities transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments.

To the fullest extent permitted by law, Sandfire, its related bodies corporate, and each of their officers, employees, agents and advisers expressly disclaim, to the maximum extent permitted by law, all liabilities (however caused, including negligence) in respect of, make no representation or warranty, express or implied, as to the currency, accuracy, reliability or completeness of any information, statements, opinions, estimates, forecasts or other representations contained in this presentation. No responsibility for any errors or omissions from this presentation arising out of negligence or otherwise is accepted.

Certain statistical and other information included in this presentation is sourced from publicly available third party sources and has not been independently verified.

All figures are expressed in Australian dollars unless otherwise stated. USD/AUD currency conversion 0.70 unless otherwise stated.

This presentation should be read in conjunction with Sandfire’s December 2020 Half-Year Financial Report and accompanying notes, released today, 25 February 2021.

This presentation is authorised for market release by Sandfire’s Managing Director and CEO, Mr Karl Simich. Forward-Looking Statements

This presentation may include forward-looking statements. Forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions which are outside the control of Sandfire. There is continuing uncertainty as to the full impact of COVID-19 on Sandfire’s business, the Australian economy, share markets and the economies in which Sandfire conducts business. Given the high degree of uncertainty surrounding the extent and duration of the COVID-19 pandemic, it is not currently possible to assess the full impact of COVID-19 on Sandfire’s business or the price of Sandfire securities. Actual values, results or events may be materially different to those expressed or implied in this presentation. Given these uncertainties, recipients are cautioned not to place reliance on forwardlooking statements. Any forward-looking statements in this presentation speak only at the date of issue of this presentation. Subject to any continuing obligations under applicable law and the ASX Listing Rules, Sandfire does not undertake any obligation to update or revise any information or any of the forward-looking statements in this presentation or any changes in events, conditions or circumstances on which any such forward-looking statement is based.

The Expansion Case to 5.2Mtpa referred to in this presentation, where it relates to A4 and other prospects, is based on preliminary resource drilling, technical and economic assessments. Drilling and associated study work at A4 is currently insufficient to support estimation of Ore Reserves or to provide assurance of an economic Expansion Case for the Motheo Production Hub.

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Execute delivery

Strategy Creating value through opportunity

Sustainable production Accelerate discovery Align and empower our people Optimise capital structure

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• DeGrussa copper production: 35,790t of contained copper and 21,343oz of contained gold at C1 US$0.72/lb; pleasing safety performance:

• FY2021 guidance: positioning for upper end of guidance 67-70kt of contained copper and 36-40koz of contained gold, at C1 US$0.85-$0.90/lb

• Old Highway Gold Prospect resource drilling well advanced – studies continue on transition to gold production at DeGrussa leveraging existing infrastructure

Highlights

1HFY2021

• :

• 5.2Mtpa Motheo Copper-Silver Production Hub concept emerging

• Board approval for initial 3.2Mtpa operation at T3 , development commenced Q3FY2021 with 12.5-year mine life at ~30ktpa Cu and 1.2Mozpa Ag

• Maiden 100kt Cu Inferred Mineral Resource for A4 deposit with strong growth potential highlighted by post-resource high-grade intercepts of up to 16% Cu

• Exceptional exploration upside within dominant 26,650km[2] ground-holding in Botswana and Namibia

• Black Butte Copper Project, USA – Enhancements to Feasibility Study underway; maiden Ore Reserve for the Johnny Lee Deposit; updated Inferred Mineral Resource for the Lowry Deposit; new near-mine exploration programs underway

• Strong $335.8M cash holding and no debt at 31 December 2020 (excluding lease liabilities)

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Copper│ Emerging Market Deficit Driven by Multiple Factors

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DeGrussa Operations │FY2021 YTD Production
93.4% Cu
recovery
Copper
production:
35,790t Cu
21,343oz Au
contained
48.4% Au
recovery
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DeGrussa Operations │FY2021 YTD Production

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DeGrussa Operations

1HFY2021 Headline Financial Results

$355.6M

Record sales revenue

$192.1M

Group EBITDA

$60.1M

Net profit after tax attributable to equity holders ($87.1M D&A)

$335.8M Cash and equivalents ($44.6M increase)

$137.8M Cash flow from operating activities ($28.7M increase)

8cps Fully-franked Interim Dividend (EPS 34.1cps)

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1HFY2021 │Group Segment Contribution to EBITDA

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Feasibility studies, drilling and
permitting
Exploration drive
across global
jurisdictions
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1HFY2021 │Group EBITDA – 1HFY2020 to 1HFY2021

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Higher copper
concentrate Strong cost Exploration Strong cost
holding control and drive across control
(January 2021 increased FX global
Increase in sales), lower rate jurisdictions
copper price, ROM stocks
despite carry
over of sales
into 2H
FY2021
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Financial Position

1HFY2021

• Maintaining strong financial position for growth

• Group cash holding increased to $335.8M

• Increased inventory with 4 shipments completed in January 2021

• Financial investments $81.9M

• Current tax receivable $23.8M (received January 2021) and payable $21.8M (expect Q4 CY2021)

• Debt free balance sheet (excluding lease liabilities) positions for financing flexibility in project development

Cash and equivalents

($44.6M increase)

$972.6M Total assets

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($78.5M increase)
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$806.1M Net assets

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($55.8M increase)
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● Continued returns to shareholders

• Maintaining dividend stream from profitable DeGrussa Operations

• 8.0cps interim dividend for FY2021:

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8cps
Fully-franked Interim
Dividend
(EPS 34.1cps)
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• Fully franked

Dividends

1HFY2021

  - Record date 3 March 2021

  - Payment date 17 March 2021

• Optimised capital structure to drive dividend payments in conjunction with:

• Project development

• Funding mix

• Exploration and expansion capital expenditure

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1HFY2021 │ Cash Generation and Investment

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Summary and Outlook

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Strong foundations – high-margin production and cash-flow, strong debt-free balance sheet

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New long-life production hub being developed in Botswana with development of T3 (Motheo) commenced in Q3 FY2021

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Highly prospective global exploration portfolio to drive organic growth

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A capable and focused international exploration, development and mining operations team

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A strong platform for long-term valuecreation in a rising copper market

Sandfire is well on the path to completing its transformation from a single-mine company operating in Australia into a diversified and sustainable mining company

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Competent Person’s Statements

T3 Ore Reserve

The information in this report that relates to Open Pit Ore Reserves, is based on information compiled by Mr Jake Fitzsimons who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Fitzsimons is employed by Orelogy Consulting Pty Ltd and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Fitzsimons consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

DeGrussa and Monty Ore Reserve

The information in this report that relates to Ore Reserves is based on information compiled by Mr Neil Hastings who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Hastings is a permanent employee of Sandfire and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Hastings consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

DeGrussa, Monty, T3 and A4 Mineral Resource

The information in this report that relates to Mineral Resources is based on information compiled by Mr Callum Browne who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Browne is a permanent employee of Sandfire and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Browne consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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December 2020 Half Year Financial Results Presentation

25 February 2021

Contact Details

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Level 2, 10 Kings Park Road, West Perth WA 6005 Australia PO BOX 1495, WEST PERTH WA 6872 AUSTRALIA +61 8 6430 3800 +61 8 6430 3849 www.sandfire.com.au

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