Warrior Met Coal, Inc. · NYSE:HCC
Warrior Met Coal — Q1 2019 Earnings Presentation
16 slides from Warrior Met Coal's earnings presentation, May 1, 2019
Slide 1: First Quarter 2019 Results
First Quarter 2019 Results May 1, 2019 PRELIMINARY | SUBJECT TO FURTHER REVIEW AND EVALUATION These materials may not be used or relied upon for any purpose other than as specifically contemplated by a written agreement with Credit Suisse AG or its Affiliates (hereafter “Credit Suisse”).
Slide 2: Forward looking statements
W ar r ior Met Coal Page 1 Forward looking statements These slides contain, and the officers and representatives of Warrior Met Coal, Inc. (the “Company”) may from time to time make, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 2
Slide 3: 2019 Achievements
W ar r ior Met Coal Page 2 2019 Achievements 1 Recorded best-ever quarterly production volume of 2.3 million short tons (“St”) ✓ 2 Consummated restricted payment offer to permit up to $299 million in shareholder returns and consummated concurrent tender offer ✓ 3 Declared a special cash dividend of
Slide 4: Key Metrics for Q1 2019 vs. Q1 2018
W ar r ior Met Coal Page 3 Key Metrics for Q1 2019 vs. Q1 2018 Q1 2019 Q1 2018 % Change Tons produced (in 000s St) 2,298 Tons produced (in 000s St) 2,098 10% Tons sold (in 000s St) 2,096 Tons sold (in 000s St) 2,116 (1)% Gross price realization (1) 98% Gross price realization (1) 99% (1)% Average ne
Slide 5: Leverage and Liquidity Analysis
W ar r ior Met Coal Page 4 Leverage and Liquidity Analysis Financial Metrics ($MM except ratios) Leverage (for the trailing twelve months ended March 31, 2019) Adjusted EBITDA* $565.6 Consolidated Net Debt* (1) $190.7 Net Leverage Ratio* 0.34x Liquidity (as of March 31, 2019) Cash and Cash Equivalen
Slide 6: Generated Significant Free Cash Flow on Strong Conversion of Adjusted EBITDA Margins
W ar r ior Met Coal Page 5 Generated Significant Free Cash Flow* on Strong Conversion of Adjusted EBITDA* Margins(1) Adjusted EBITDA Margin*(1) FCF Conversion*(2) 79% 77% 83% 65% 53% 67% 60.0% 51.3% 50.0% 47.9% 44.8% 42.4% 39.9% 40.0% 34.4% 30.0% 20.0% 10.0% 0.0% Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2
Slide 7: Production Growth Continued in 2019
W ar r ior Met Coal Page 6 Production Growth Continued in 2019 Tons Produced (thousand short tons) Longwall moves - - 2 1 1 2,500 2,298 2,098 1,889 2,000 1,929 1,819 520 496 596 464 1,500 582 1,000 1,778 1,602 1,333 1,425 1,237 500 – Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 No. 7 Mine No. 4 Mine 1 sh
Slide 8: Looking Forward: 2019 Full Year Guidance
W ar r ior Met Coal Page 7 Looking Forward: 2019 Full Year Guidance • Continue to Maximize Shareholder Value in 2019 • Coal sales of 7.1 – 7.6 million St • Coal production of 7.1 – 7.6 million St • Cash cost of sales (free-on-board port)* of $89 - $95 per St • Capital expenditures of $100 - $120 mil
Slide 9: World-Class Blue Creek Project Provides Warrior with High-Return Option for Growth
W ar r ior Met Coal Page 8 World-Class Blue Creek Project Provides Warrior with High-Return Option for Growth ◼ One of the few remaining untapped premium quality High Significant Growth Potential Vol A coal reserves in the U.S., trading currently at premium prices ◼ Would provide a portfolio of Prem
Slide 10: Recent High Vol A Pricing Dynamics Make Blue Creek Even More Compelling
W ar r ior Met Coal Page 9 Recent High Vol A Pricing Dynamics Make Blue Creek Even More Compelling $350 U.S. High Vol A Price Premium / (Discount) U.S. Low Vol Aus Premium Low Vol Current 8% (1)% 1 Month 6% (0)% $300 1 Year 6% (3)% 2 Years 3% (6)% ($ / Short Ton) $250 $200 $ 183 $ 181 $ 169 $150 $10
Slide 11: Appendix
W ar r ior Met Coal Page 10 Appendix
Slide 12: Appendix
W ar r ior Met Coal Page 11 Appendix For the three months ended For the three months ended March 31, 2019 (Unaudited) March 31, 2018 (Unaudited) Short Tons Metric Tons Short Tons Metric Tons Tons sold (in 000s) 2,096 1,901 2,116 1,920 Tons produced (in 000s) 2,298 2,084 2,098 1,904 Gross price reali
Slide 13: Non-GAAP Financial Measures: Adjusted EBITDA Reconciliation
W ar r ior Met Coal Page 12 Appendix Non-GAAP Financial Measures Reconciliation of Adjusted EBITDA to Amounts Reported Under U.S. GAAP For the three months ended March 31, (Unaudited) (in thousands) 2019 2018 Net income $ 110,447 $ 178,694 Interest expense, net 8,592 8,560 Income tax expense 27,984
Slide 14: Non-GAAP Financial Measures: Free Cash Flow Reconciliation
W ar r ior Met Coal Page 13 Appendix Non-GAAP Financial Measures Reconciliation of Free Cash Flow to Amounts Reported Under U.S. GAAP For the three months ended March 31, (Unaudited) (in thousands) 2019 2018 Net cash provided by operating activities $ 126,408 $ 193,738 Purchases of property, plant a
Slide 15: Non-GAAP Financial Measures: Adjusted Net Income Reconciliation
W ar r ior Met Coal Page 14 Appendix Non-GAAP Financial Measures Reconciliation of Adjusted Net Income to Amounts Reported Under U.S. GAAP For the three months ended March 31, (Unaudited) (in thousands) 2019 2018 Net income $ 110,447 $ 178,694 Transaction and other expenses, net of tax - 3,288 Loss
Slide 16: Non-GAAP Financial Measures
W ar r ior Met Coal Page 15 Appendix Non-GAAP Financial Measures