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Contents. Eastern Goldfields, Inc. Symbol: EGDD. Investor Presentation. By Zenith Premier Limited. August 2006. Contents. Contents. Page. Executive Summary 1-5 Market Capitalization of Junior African Gold Companies6-7 Gold Price8

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Eastern Goldfields, Inc.

Symbol: EGDD

Investor Presentation


Zenith Premier Limited

August 2006




Executive Summary1-5

Market Capitalization of Junior African Gold Companies6-7

Gold Price8

US Dollar v. South African Rand9

EGI Price & Volume10

EGI Website11

Executive Summary


Name: Eastern Goldfields, Inc. (; Symbol “EGDD”

Pre-Funding New Issue Post-Funding



Free Trading1,495,2331,495,233


Original Shareholders


Free Trading 945,511 945,511


Other Shareholders


Free Trading2,649,2563,049,256


Pre-Funding 8,456,247

Post-Funding400,000 ??8,856,247

No. of Shareholders: Approximately 100

Current Price: $5.50 USD $5.00 Bid – $6.40 Offer

Capitalization: $46.51 Million US Dollars



Executive Summary - Continued


  • 1st Financing raised $3 Million gross in August 2005 for working capital and drilling to further substantiate resources and reserves, which it achieved successfully (see News Release 2 – January 2006)

  • 2nd Financing up to $2 Million in Autumn 2006 via 400,000 (?) new issue stock to be used as follows:

    Lily Mine

    • Phase 3 drilling (7,500 metres)$700,000

    • RC Drilling – East extension$ 50,000

    • Underground feasibility study$185,000$ 935,000

      Regional Exploration (including Worcester)

    • Target identification, ground survey, trench sampling

      RC drilling (1,500 metres)$ 735,000

      Corporate Compliance

    • Legal, audit, finance fees, etc.$ 330,000




Executive Summary - Continued

  • Management with a proven track record of successful mining in this environment backed by international consultants; financial, legal, geological and engineering

    • Board of Directors: Mike McChesney (President & CEO); Willo Stear (Chief Technical Officer); Tamer Muftizade (CFO); Robert McDermott (Non-Executive), Maurice Emery (Non-Executive)

    • SEC Auditors (Mendoza Berger & Company) and Legal Council (Carmine J. Bua) engaged in the United States (SEC) and auditors (KPMG) engaged in South Africa

  • All legal structures including Black Economic Empowerment (Lomshiyo Investments) satisfying the 2004 South African Mining Law in place

  • Short term aim in 2006 is to become listed on Small Cap NASDAQ. This will expose the company to a broader institutional audience and a much larger shareholder base

  • London AIM Listing is being considered for 2007

  • Probability of acquisitions in the future to add significant value to the Group

  • Currently in a very strong market sector with Gold Price showing definite signs of strength

  • The Group has no debt

  • EGI only recently quoted on the public market and its value not yet fully established within the financial community


Executive Summary - Continued

The Bottom Line:

The 50% increase in the gold price from $420 to $630 over the last year reflects the following profitability expectations on a full production basis:

MineProductionCostsRevenueCash ProfitTimescale

Lily Mine30,000 oz$320$630 $7.9 MFrom Mid-2007

Worcester Mine20,000 oz$320$630 $4.6 MFrom Mid-2008

Total50,000 oz$12.5M

Note: Lily Mine cash profit is calculated after allowing 15% BEE profit allocation and Worcester Mine is calculated after allowing 26% BEE profit allocation

Eastern Goldfields’ short term target is to become a junior gold company that produces 100,000 oz of gold annually within 3 years. It is on the way to achieving half its target with production at its Lily and Worcester mines, and, through an aggressive exploration programme on its own land claims EGI management is confident to achieve its 100,000 oz. production goal.


Executive Summary - Continued

Eastern Goldfields is currently capitalized at only $46.51 Million.

At the projected profitability and positive outlook for Gold, it is not difficult to see that Eastern Goldfields has the potential to be capitalized at significantly higher levels than its current trading value.

P/E’s for Junior Gold Mines producing up to 100,000 oz per year vary between 20 and 50 depending upon individual company circumstances (resources and reserves, management, geography, etc.) – with the industry average at 26.

On a comparable basis, EGI is still extremely undervalued compared to its peers (see page 6). The main criteria for valuing gold companies are production, reserves, resources, exploration potential, location and management.

Companies with a similar composition to EGI are trading at between $130 to $200 million. Therefore, with an increase in production, resources, reserves and a more senior US listing added to a potential AIM listing will give EGI the momentum and exposure to take its market capitalization of $46 Million nearer to its peers.



Junior African Gold Companies



Gold Price (Jan ’05 – Current)

Since EGI went public, it has benefited by the 50% increase in the gold price


US Dollar v. South African Rand

EGI’s revenues are based on US Dollar spot gold and its production costs are in Rands. The 20% rand devaluation in the last year has also benefited EGI.


EGI Price & Volume


$ 5.50

$ 617.80



  • Gold Price

  • Rand Price

  • Increase in resources and reserves post initial drilling

  • Good management + BEE + Licenses

  • Profits & Revenues currently being achieved

  • OTCBB & Small Cap

  • AIM Listing

  • Road Shows, Coferences and Conventions

  • Tight Float


  • Subscription Procedure


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