Metarock : Half Year Results Presentation

1H FY2022 Results

onlyMetarock Group Limited (ACN 142 490 579)

useersonalTony Caruso, Managing Director Brett Maff, Chief Financial Officer

28 February 2022

Metarock Executive Summary

		•	Established Metarock as a specialised, diversified underground mining services group with the
			transformational acquisition of hard rock mining specialist, PYBAR Mining Services
	1H FY2022 Highlights	•	Strong HY financial performance from the coal contracting business
only	•	Metarock's forward order book has grown from $1.1 billion to $1.9 billion
		•	Group revenue is on track to triple over an 18-month period from work already contracted
		•	Delivered revenue of $180 million (up 62% vs PCP)
	1H FY2022 Results	•	Normalised EBITDA* of $16.6 million before one-off impacts representing a normalised EBITDA
			margin of 9.2%

• Cook Colliery Mining Services Agreement executed for 4 + 2 years at $70 million per annum average revenue

	Recent Contract Wins
use	•	PYBAR secured Maxwell Drifts Project commencing in FY2023 delivering approximately $55 to $65
	million revenue over 12 months
		•	FY2022 guidance revised down but maintaining a significant step up in FY2023:

•	FY2022 revenue guidance $450-480 million, normalised EBITDA guidance $37-43 million*.
Updated Guidance	Previously $475-510 million and $48-54 million respectively
•	Revised guidance reflects the impact of delays in Crinum production and the early
		transitional performance of PYBAR

• FY2023 revenue $700-750 million and EBITDA $80-95 million
• • Reflects full year contribution from existing mine operations contracts and PYBAR

ersonal*Excludes one-off Crinum delay, recovery costs and PYBAR acquisition costs - see slide 19

FY23 PYBAR Contribution and Mine

Operations Ramp Up

FY2022 HALF YEAR HIGHLIGHTS | METAROCK 2

Outlook - Metarock Strategy in Action

Mine operations and the diversification into hard rock mining delivers strong growth and a higher margin business

Mine Operations

Coal Contracting

Hard Rock Contracting

only
	Revenue Split
	Guidance ($m)
	Employee Numbers		130 → 378		950 → 1150	1100 → 1220
	(Fr	m - To)
use		• Mine Operations strategy allows us to operate mines			• Operating for 28 years, with long standing tier one
		in our own right	• Operating for 25 years, with long standing tier one clients	clients with average relationships lasting 7+ years
	D	scription	• Underpinned by Crinum Mine and Cook Colliery Mine	with average relationships lasting 10+ years	• Contracts tied to production and development
		operations contracts	• Contracts tied to production activities	activities
				• Long term, repeatable revenue with increased	• Leading share of underground coal contracting market	• Diversified commodity exposures across copper,
					margins			lead, zinc and gold
	Brands
ersonal		•	Coal assets will continue to change hands with many	• Contractors play a strategic role in owners assets	• Contractors play a strategic role in new
	Focus
		new owners needing to outsource underground	supporting production, providing cost flexibility and	development and production, providing cost
					operating capability	lowering operating costs	flexibility and lowering operating costs
					Dave Sykes • Joined Mastermyne in April 2012, appointed	Paul Green	• Joined Mastermyne in March 2020, appointed	Nick Woolrych
					CEO of Mine Operations in November 2021		CEO of Coal Contracting in November 2021
					• David began his career in the UK performing		• Paul was well known to the Mastermyne	• Joined PYBAR in August 2014,
					various operational and statutory roles. He		business through a close association over		appointed CEO in March 2021
	Pe		ple		has worked in senior management positions		many years. Paul has over 25 years' experience	•	Nick is a mining engineer with over
			across a number of underground coal		in operational management in roles at
							20 years' experience in the mining
					operations including Moranbah North,		Gordonstone Coal, Illawarra Coal and Ensham		industry in operational, project
					Dartbrook and Central Colliery in roles		Coal. He has also worked in strategic		development, commercial and
					including Mine Manager and SSE/General		development and organisational change roles		investment roles across a range of
					Manager		across the Australian coal mining industry		commodities and geographies
								FY2022 HALF YEAR HIGHLIGHTS | METAROCK	3

Crinum Mine Update

The accident has had a profound impact on our business and our people

•

only•

•

•

•

Underground accident occurred on 14 September 2021 fatally injuring our colleague Graham Dawson

We have remained in close contact with Graham's family and continue to support our people and the families affected by the accident

The staged restart process has focused on ensuring we are assessing the risks so that the project is recommencing safely and efficiently

All work is being carried out with the approval of the resources regulator

Sojitz Blue (mine owner) remains supportive and continues to work closely with the company

use•

•

•

ersonal•

•

•

We are making decisions that will accelerate our production along with investing in additional equipment to recover our schedule

Schedule now has first coal being delivered in the 4th quarter of FY2022 and progressively ramping up to full operations (three panels) by the 1st quarter of FY2023

The fall of ground occurred in the underground access tunnels, impacting a small localised area, which is distinctly different from the underground mining area

The accident has delayed first coal by approximately 20 weeks with an impact of ~$7 million

The ~$7m is made up of direct costs incurred in H1. The remaining H2 costs have been reflected in revised guidance numbers for FY2022

We are looking forward to a bright future on this project, with a material contribution to earnings

FY2022 HALF YEAR HIGHLIGHTS | METAROCK 4

Transformational acquisition - PYBAR

Increasing confidence in PYBAR's business and culture and its alignment with our broader values and direction

	Strategic Rationale Confirmed
	•	Highly complementary with MYE's core business of underground mining and expedites our diversification strategy	✓
	•	Exposure to a broad suite of commodities with immediate scale and a national footprint	✓
	•	1,100+ highly skilled hard-rock employees with a strong position in the east coast market and long term	✓
		relationships with Tier 1 clients such as Glencore (Mt Isa) and Newcrest (Cadia).
	•	Fully exploiting growth potential through accessing the resources of a public company
only	•	Historically been a capital constrained private company	✓
•	Clients overcoming hesitation in dealing with a private company enabling access to larger, longer term
use		contracts with Tier 1 clients.
•	Malabar contract win is a major vote of confidence from our customers in the new larger business
Purchase price $47 million equity and deferred cash consideration
	•
		•	$23.5m equity on completion	✓
		•	Remaining $23.5 paid over two cash payments (first $11.75m paid on completion)
		•	$5 million of the remaining deferred cash consideration to be converted to equity with balance paid in
			November 2022
	•	$50 million of assumed equipment finance
		•	Provides us with a suite of specialised hard-rock equipment	✓
		•	OEM backed equipment finance for a fleet that is hired to the client

• Post acquisition equipment valuation has seen a $13 million balance sheet uplift from $56 million to 69 million

ersonal	Fits well with MYE's track record of acquiring and reinvigorating private businesses	✓
	•
	•	Increasing confidence in PYBAR's business and culture and its alignment with our broader values and direction
	•	Strong pipeline underpinned by unprecedented strength in the underlying global fundamentals of hard rock	✓
		minerals
	•	H1 results reflect the normal ups and downs of a mining contracting business

*Includes equipment valuation depreciation uplift (non-cash)

		PYBAR	PYBAR Target
		Guidance	Metrics
		FY2023	FY2024
	Revenue	$280m - $300m	$330m - $350m
	EBITDA	$31m - $34m	$38m - $40m
	EBITA*	$3m - $6m	$11m - $13m
	Remaining
Equipment Finance	~$33m	~$16m
Position after Debt	(34% reduction of	(68% reduction of
	Servicing and	debt)	debt)
utilising Free Cash
	Previous Metarock Acquisition Wilson Mining -
35		Revenue Growth $M
30
25
20
15
10
5
0
FY2020	FY2021	FY2022

FY2022 HALF YEAR HIGHLIGHTS | METAROCK 5