New Hope Corporation Limited · ASX:NHC
New Hope — Coaltrans Conference (August 2009)
15 slides from New Hope's conference presentation, Aug 17, 2009
Slide 1: A Producers View: Navigating through difficult markets and managing coal industry volatility
For personal use only Robert Neale, New Hope Corporation Limited A Producers View: Navigating through difficult markets and managing the current coal industry volatility August 2009
Slide 2: Disclaimer
For personal use only Disclaimer IMPORTANT: The information in this document has been provided to you for information only by New Hope Corporation Limited (“NHC”) and is subject to change without notice. Nothing contained in this document constitutes investment, legal, tax or other advice. The infor
Slide 3: Introductory Comments
For personal use only Introductory Comments $/tonne 250.00 In 2007, I introduced a paper Newcastle Spot Price (US $’s/Tonne) with the following comments: 200.00 “May you live in interesting times” – Old Chinese Curse and 150.00 2009 2007 “The future ain’t what it used to be” – Yogi Berra 100.00 The
Slide 4: How is this Relevant to Today's Presentation?
For personal use only How is this Relevant to Today’s Presentation? Are the business success factors discussed in 2007 still relevant in the very different, difficult and volatile international coal markets of today? z The thermal coal market has undergone the largest boom and bust price cycle in
Slide 5: Some Key Elements of Current NHC Strategy
For personal use only Some Key Elements of Current NHC Strategy Constantly improve base business, position NHC for ongoing growth, and drive projects up the value curve. Complete current expansion projects on time and within budget. z New Acland Expansion to 4.8 MTPA z QBH Port Stockyard Expansi
Slide 6: NHC Corporate Reinvention Phases
For personal use only NHC Corporate Reinvention Phases (D) Arro “Elective - Not Reactionary Re-Invention” Acl w Acq and u Exp isition ans ions * Corporate Re-Invention (C) Sol d (G) NH Acq Adar C uire o d1 200 Gro Next wth 00% QB H 9 Pha se Corporate Re-Invention (B) (F) Growth Dar New ling Do Sol d
Slide 7: NHC Corporate Growth Drivers
For personal use only NHC Corporate Growth Drivers s? isition Risk Assessments CHANGE CATALYSTS TRANSFORMATIONAL A c qu s usines to manage unexpected GLOBAL ECONOMICS ted B events Commodity Prices Rela lopme nt ev e nD Supply – Demand Issues C o nversio Operational n International Markets Carbo itio
Slide 8: Key Business Success Factors
For personal use only Key Business Success Factors Re-Invention Corporate Re-invention Triggers Annual Strategy Defines the “what” & “why” Update e.g. Market Relationships Corporate Risk Management S Objectives U C Organisational Federalist Model C Industry & Structure Govt Trends E S Relevant Exper
Slide 9: Commodity Cycles Influence Market Difficulties & Volatility
For personal use only Commodity Cycles Influence Market Difficulties & Volatility Commodity businesses are generally governed by the cyclic variations in supply and demand. Industry volatility is a function of these cycles. Over Supply Excess Demand NHC (past year) Coal Volumes Down Up Coal Prices D
Slide 10: Market is not necessarily Difficult, but it is Challenging
For personal use only Market is not necessarily Difficult, but it is Challenging Supply – Demand variations drive different issues from both buyer and producer perspectives. z Producers have had boom times for past few years, and life has been relatively easy. z People have conveniently forgotten
Slide 11: Australia's Thermal Coal Exports
For personal use only Australia’s Thermal Coal Exports 7,000 6,000 5,000 Japan 000t 4,000 Australian Korea 000t Thermal Coal Exports India 000t (000t) Taiwan 000t 3,000 China 000t 2,000 1,000 0 1-Jan-09 1-Apr-09 1-Apr-07 1-Apr-08 1-Jan-07 1-Jul-07 1-Oct-07 1-Jan-08 1-Jul-08 1-Oct-07 Source: Barlow J
Slide 12: Some NHC Navigational Aids for Difficult Markets
For personal use only Some NHC Navigational Aids for Difficult Markets NHC commenced locking up coal volumes 2 years ago. z Broaden and grow Chinese market share out of NHC Growth while still increasing Japanese market volumes. z Volume can have much greater impact than price on corporate bottom l
Slide 13: Have NHC Strategies been Successful? I believe so!
For personal use only Have NHC Strategies been Successful? I believe so! Year Ended July 31 2005 2006 2007 2008 2009 Operations NPAT ($’s M) 53.1 68.7 69.3 90.7 125 – 150 Production (MTPA) 3.7 3.7 3.8 4.4 5.14 Sales (MTPA) 3.5 3.8 3.7 4.5 4.97 Market Cap ($’s M) * 1,000 1,026 1,722 3,792 4,241 ASX T
Slide 14: NHC Points of Distinction
For personal use only NHC Points of Distinction Independent owner – operator with a Federalist Organisation. Well experienced with over 50 years of operations. “Hands on” management with experiential “scar” tissue. History of delivering or exceeding expectations. Ongoing market positioning
Slide 15: Thank you
For personal use only Robert Neale, New Hope Corporation Limited Thank you August 2009