Dynacor's (TSX:DNG) (OTC:DNGDF) June 2014 corporate presentation.

1. INVESTOR
PRESENTATION
June
-­‐
2014

2.
Forward
Looking
Statements
This
presentation
contains
certain
forward-­‐looking
statements
regarding
operational
information,
future
exploration
and
development
plans
and
anticipated
future
production.
Words
such
as,
potential”,
“building”
“inferred”,
“if”,
“will”,
“expect”,
“forecast”,
“estimate”,
“consider”,
“may”,
“possible”
and
similar
expressions
have
been
used
to
identify
these
forward-­‐looking
statements.
These
statements
are
management’s
current
beliefs
and
are
based
on
information
currently
available
to
management.
Forward-­‐looking
statements
involve
significant
risk
and
uncertainties.
A
number
of
factors
could
cause
actual
results
to
differ
materially
from
the
results
discussed
in
the
forward-­‐looking
statements
including,
but
not
limited
to,
changes
in
general
economic,
political
and
market
conditions
and
other
risk
factors.
Although
the
forward-­‐
looking
statements
contained
herein
are
based
upon
what
management
believes
to
be
reasonable
assumptions,
management
cannot
assure
that
actual
results
will
be
consistent
with
these
forward-­‐looking
statements.
Investors
should
not
place
under
reliance
forward-­‐looking
statements.
Forward-­‐looking
statements
and
other
information
contained
herein
concerning
the
metals
and
mining
industry
and
Dynacor’s
general
expectations
concerning
the
industry
are
based
on
estimates
prepared
by
management
using
data
from
publicly
available
industry
sources
as
well
as
from
private
sources,
industry
analysis
and
on
assumptions
based
on
data
and
knowledge
of
the
this
industry
which
the
Company
believes
to
be
reasonable.
However,
this
data
is
inherently
imprecise.
While
Dynacor
is
not
aware
of
any
misstatements
regarding
any
industry
data
presented
herein,
the
industry
involves
risks
and
uncertainties
and
is
subject
to
change
based
on
various
factors.
There
is
no
certainty
the
projections
will
be
met.
2014-­‐06-­‐05
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3. A
Gold
Performer
Only
36
million
shares
outstanding
High-­‐Reward
Home
Run
Potential
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A
non-­‐dilutive
business
model
The
key
to
$1.00
eps

4. A
Non-­‐Dilutive
Strategy
§ An
industrialized-­‐type
gold
company
with
low
risk
business
model
in
Peru
§ Operating
in
Peru
for
almost
twenty
years;
well
acclimatized
to
its
customs
and
politics
§ Gold
and
silver
production
via
ore-­‐processing
operation
–
CASH
FLOW
GENERATOR
§ Self
finances
exploration
campaigns
§ 36.3
million
shares
outstanding
§ Net
income
of
$9.1
million
in
fiscal
2013
($0.25
earnings
per
share)
§ $17.8
million
working
capital
as
of
March
31,
2014
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5. Operations
§ Ore-­‐Processing
§ Huanca:
Producing
§ Chala:
Emerging
Producer
§ Exploration
§ Flagship
Project:
Tumipampa
§ Greenfield
Projects:
Anta
and
Casaden
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5
PERU

6. Operating
Areas
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S
E
W
N
Zoom
Huanca
1
Producer:
250
tpd
Chala
2
Emerging
Producer:
Awaiting
plant
permit
on
new
300
-­‐600
tpd
mill
Tumipampa
3
Exploration:
Underground
high-­‐
grade
gold
drilling;
surface
drilling
on
disseminated
zone
Lima
DRIVING
0
HOURS
30
HOURS

7. Objectives
§ Short-­‐term
(12
months):
§ Produce
80,000
ounces
on
annual
basis
§ Continue
cross-­‐cut
to
750
meters
§ Underground
drilling
(Manto
Dorado,
Veta
Rosa,
Veta
Tumi)
§ Geophysical,
geochemical
and
surface
drilling
(Disseminated
Breccia
zone)
§ Begin
exploration
campaign
on
Anta
(Ag)
§ Long-­‐term
(12-­‐36
months)
§ Increase
ore-­‐processing
capacity
to
600
tpd
(Chala)
§ Maximize
shareholder
value
via
direct
production
at
Tumipampa
§ To
be
the
leading
ore-­‐processing
company
in
Peru
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8. Delivering
Over
Time:
Huanca
0
20,000
40,000
60,000
80,000
100,000
120,000
2010
2011
2012
2013
43,743
74,568
104,994
112,114
33,525
46,025
61,264
76,883
Operational
Performance
(2010-­‐2013)
Sales
($000)
Gold
Production
(oz)
(000)
Sold
76,883
ounces
with
an
average
grade
of
1.04
oz/tonne
(32.34
g/t
Au)
in
2013
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9. Production
Estimate
With
New
Mill
Expansion:
Chala
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
300
TPD
(0.90
OZ/T
AU)
450
TPD
(0.82
OZ/T
AU)
600
TPD
(0.75
OZ/T
AU)
86,000
118,000
144,000
Gold
ounces
Annual
Production
Estimate
Chala
2014-­‐06-­‐05
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10. Solid
Operational
Execution
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25,000
45,000
52,000
66,000
70,000
33,525
46,025
61,264
76,883
Gold
Production
2010
Guidance
2010
Actual
2011
Guidance
2011
Actual
2012
Guidance
2012
Actual
2013
Guidance
2013
Actual
2014
???

11. Actual
Cash
Flow
and
Earnings
Per
Share
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GOLD
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2011
2012
2013
$0.13
$0.26
$0.29
$0.09
$0.21
$0.25
Cash
Flow/Share
Earnings/Share

12. Earnings
Scenario
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300TPD
450TPD
600TPD
900TPD
1200TPD
86,000
Au
oz/yr
118,000
Au
oz/yr
144,000
Au
oz/yr
216,000
Au
oz/yr
288,000
Au
oz/yr
0.29
EPS
0.39
EPS
$0.48
EPS
$0.71
EPS
$0.95
EPS
Planned
Development
Potential
Future
Development
NET
PROFIT/OZ
NET
PROFIT
MARGIN
$118-­‐126
8-­‐11%
$10.3
MILLION
$0.29
EPS
$14.3
MILLION
$0.39
EPS
$17.2
MILLION
$0.48
EPS
$25.9
MILLION
$0.71
EPS
$34.5
MILLION
$0.95
EPS
Earnings
per
share
forecast
based
on:
36
million
o/s
|
$120
per
ounce
net
profit
Range
over
last
2
years
2012-­‐2013
36
M
shares

13. Tumipampa:
High
Grade
Gold
Project:
§ Ongoing
cross-­‐cut
and
underground
drill
program
§ Surface
exploration
and
drilling
on
disseminated
breccia
zone
§ Surrounded
by
six
senior
miners
in
south
central
Peru
§ Released
drill
results
of
115.7
g/t
(3.7
ounces)
Au
in
December
2013
§ Auto-­‐financed
exploration
model
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14. 2014-­‐2015
Exploration
Campaign:
Tumipampa
§ Exploration
budget
of
$4.5
million
§ Excavate
420m
cross-­‐cut
to
Rosa/A/Tumi
veins
§ Drill
12
holes
(2000m)
in
the
cross-­‐cut
§ Drill
6
holes
(1800m)
in
the
disseminated
zone
§ Geophysical
studies
of
disseminated
zone
§ Geochemical
and
mapping
of
disseminated
zone
2014-­‐06-­‐05
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15. Tumipampa:
Project
Location
2014-­‐06-­‐05
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LIMA
CUZCO
Cuzco
Region
Apurimac
Region
Arequipa
Region
“La
Yegua”
Cu/Au
project
Joint
Venture
with
Japan
(JOGMEC)
Drilling
campaign
underway
“Cotobambas”
404Mt,
0.42%
Cu
“Los
Chancas”
355Mt,
0.62%
Cu
$1.2B
projected
development
budget
Dynacor
“Tumipampa”
Advancing
High-­‐Grade
Gold
zone
“Las
Bambas”
1.7Bt,
0.60%
Cu
SOLD
FOR
$6B
TO
CHINA/
04/14
“Constancia”
277Mt,
0.43%
Cu
Acquired
March/11
$520M
($0.10/lb
Cu)
“Haquira”
569Mt,
0.64%
Cu
Acquired
Oct/10
$460M
($0.06/lb
Cu)
• HIGH-­‐GRADE
GOLD
DEPOSIT
• ADJACENT
TO
TUMIPAMPA’S
SW
BORDER
• MINED
BY
LOCALS
FOR
OVER
10
YEARS
• AVERAGE
GRADE
OF
1/OUNCE
TONNE
• ORCOPAMPA
/
BUENAVENTURA
• HIGH-­‐GRADE
GOLD/SILVER
VEIN
DEPOSIT
• 2.1
MILLION
OZ
AU
/
19.8
MILLION
OZ
AG
• EXHIBITS
SIMILAR
CHARACTERISTICS
TO
TUMIPAMPA’S
HIGH-­‐GRADE
VEIN
STRUCTURE
0
km
200
km
$8
billion
in
development
and
3.6
billion
tons
of
ore
surround
Tumipampa

16. Tumipampa:
Project
Display
Model
1
VEIN
A
VEIN
B
VEIN
2007
VEIN
SAN
PEDRO
VEIN
BRECCIA
BRECCIA
Tumipampa
River
Poctococha
Lagoon
Balsacocha
Lagoon
Patacocha
Lagoon
ROSA
VEIN
Skarn
(E)
Cu-­‐Au
Skarn
(W)
Cu-­‐Au
Gold
veins
Disseminated
gold
Zone
4
Old
Spanish
gold-­‐rich
tailings
Cross-­‐cut
tunnel
location
0
1
km
Ø
15
gold
veins
discovered
to
date
Ø
Ancient
drifts
from
Spanish
colonial
period
Ø
2
old
stock
piles
discovered
by
Tumipampa
River
Ø Project
consists
of
three
types
of
gold
mineralization:
Skarn,
Gold
Veins
and
Disseminated
Gold
associated
with
Breccias
Zone
3
Zone
2
Zone
1
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17. 2014-­‐06-­‐05
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GOLD
MINES
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VETATUMI
VETA
ROSA
HDD 11
HDD 07
HDD09
HDD10
HDD08
4200
4250
4300
4350 CRUCERO 330NW
MANTO DORADO
Continuación de Crucero 330NW
PROY HDD
PROY HDD
PROY HDD
PROY HDD
HDD08-13- IM (463,00 m)
HDD18
4400
4450
HDD 21
TCD 06
0 100
GAL 190E
CH 125
PROY HDD
PROY HDD
Future drill targets
HDD-­‐2013
HDD Ancho (m) Au (g/t) Ag(oz/t) Cu (%)
HDD01-350-IM 1.56 14.67 0.24 0.51
HDD02-350-IM 1.10 115.66 0.52 3.03
HDD03-350-IM 1.42 23.73 0.25 0.19
HDD04-350-IM 0.60 7.25 0.10 0.42
HDD05-350-IM 1.91 0.99 0.07 0.01
HDD06-350-IM 1.10 0.37 0.09 0.10
HDD07-350-IM 1.20 3.08 0.17 0.32
HDD08-350-IM 1.00 17.28 0.25 2.68
HDD08-350-IM 1.50 14.31 0.69 9.57
HDD08-350-IM 0.50 122.00 1.02 6.59
HDD09-350-IM 1.70 7.09 0.09 0.46
Tumipampa:
Cross
Section
of
Underground
Works

18. Tumipampa:
Ongoing
Drilling
and
Cross-­‐cutting
§ Drilled
1753
meters
in
2nd
half
of
2013
§ Excavated
a
300
meter
(978
foot)
cross-­‐cut
measuring
3
meter
(11.0
feet)
wide
X
2.5
meter
(8.0
feet)
high
in
the
Manto
Dorado
in
2013
§ Conducted
a
1,064
ha
geophysical
study
including
a
magnetic
and
induced
polarization
survey
in
2011
§ Collected
1,300
geochemical
samples
§ Drilled
a
total
of
14,060
meters
at
Tumipampa
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19. Financial
Overview
As
at
December
31,
2013,
the
Company’s
working
capital
amounted
to
$17.4M
Dynacor
Gold
Mines:
A
self-­‐financed
gold
company:
operating
an
ore-­‐processing
business
to
generate
gold
sales
that
fund
the
exploration
of
high-­‐reward
mineral
properties.
”Dynacor
Gold
Mines
is
NOT
a
diluting
asset.”
2014-­‐06-­‐05
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20. Three
Year
Overview
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21. Senior
Management
Experienced
and
well-­‐balanced
team
with
expertise
in:
ü Geology/Exploration
ü Metallurgy
ü Custom
milling
ü Business
management
ü Finance
ü Marketing
Since
the
inception
of
Dynacor
Gold
Mines
Inc.
in
the
fall
of
2007,
the
management
team
has
remained
focused
on
a
disciplined
capital
structure,
via
generating
cash
flow
from
its
ore-­‐
processing
division,
to
unlock
the
greater
shareholder
value
through
the
exploration
of
its
100%
owned
Tumipampa
advanced
gold
exploration
project.
Management
strives
to
avoid
dilution
of
its
shareholders
by
repeated
financings
that
typify
the
junior
gold
exploration
sector.
JEAN
MARTINEAU,
PRESIDENT
AND
CEO
• 20
YEARS
EXPERIENCE
IN
THE
RESOURCE
INDUSTRY
IN
CANADA
AND
SOUTH
AMERICA
• FORMER
DIRECTOR
OF
WESDOME
GOLD
MINES
1999
–
2007
LEONARD
TEOLI,
VICE
PRESIDENT
AND
CFO
• 20
YEARS
EXPERIENCE
IN
ACCOUNTING
AND
FINANCE
EXECUTIVE
• FORMER
CFO
OF
DIA
BRAS
EXPLORATION
2003-­‐2008
• STARTED
CAREER
WITH
PRICE
WATHERHOUSE
1987
–
1996
• MEMBER
OF
THE
CANADIAN
INSTITUTE
OF
CHARTERED
ACCOUNTANTS
SINCE
1990
JORGE
LUIS
CARDENAS,
GENERAL
MANAGER
ORE-­‐PROCESSING
• MINING
ENGINEER
AND
METALLURGIST
• MORE
THAN
20
YEARS
EXPERIENCE
IN
MINING
(18
YEARS
WITH
DYNACOR)
ALONSO
SANCHEZ,
CHIEF
GEOLOGIST
• 15
YEARS
EXPERIENCE
AS
A
MINE
AND
EXPLORATION
GEOLOGIST
(EXPERT
OF
PERUVIAN
GEOLOGY)
• FORMER
GEOLOGIST
OF
PUBLICLY
LISTED
COMPANY
BUENAVENTURA
S.A.A
FROM
1995-­‐2006
• EXPERT
IN
EPITHERMAL
GOLD,
SILVER,
TIN,
TUNGSTEN,
POLYMETALLIC
DEPOSITS
AND
SKARNS
IN
PERU
2014-­‐06-­‐05
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22. Head
Office
625,
boul.
René-­‐Lévesque
Ouest
Suite
1105
Montréal,
(Québec)
H3B
1R2
(514)
393.9000
Dale
Nejmeldeen
Investor
Relations
(604)
492.0099
www.dynacorgold.com
2014-­‐06-­‐05
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MINES
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