Peabody Energy Corporation · NYSE:BTU
Peabody Energy — Debt Investor Presentation (April 2016)
37 slides from Peabody Energy's debt investor presentation, Apr 13, 2016
Slide 1: Lender Overview March 2016
Lender Overview March 2016 Exhibit 99.7
Slide 2: Lender Overview Topics
Lender Overview March 2016 Introductions Peabody Overview Historical Financial Performance Review of Current Liquidity DIP Forecast/Objectives Appendix Topics Peabody’s North Antelope Rochelle Mine is the world’s largest and most productive coal mine. Production totaled 109 million tons in 2015, or
Slide 3: Executive Summary
Executive Summary Business segment performance in key markets shows strength despite unprecedented market pressures Prior debt and hedging actions against extreme down-cycle conditions placed unsustainable burden on company despite significant cost, portfolio and overhead improvements Sustainable mi
Slide 4: Peabody the World's Largest Private Sector Coal Company
Peabody the World’s Largest Private Sector Coal Company Major Positions in Core Regions of PRB, ILB and Australia Additional sales and trading offices in London, Beijing, New Delhi and Newcastle
Slide 5: Coal to Continue to be Fundamental Part of Energy Mix
Coal to Continue to be Fundamental Part of Energy Mix for Many Decades to Come Source: Wood Mackenzie. Renewables Natural Gas Oil Nuclear Hydro Coal 2000 2035P 2015P Most third party projections show that coal will be a substantial source of electricity and essential ingredient in steel making Conti
Slide 6: Peabody Holds Unmatched Asset Base
Peabody Holds Unmatched Asset Base 26 active operations in U.S. and Australia 6.3 billion tons of coal reserves 2 billion tons of unassigned reserves 30 year reserve- to-production ratio 690 million ton sales backlog 500,000 acres of surface lands Assets offer geographic and product diversity Source
Slide 7: Peabody's PRB Position is Unsurpassed
Peabody’s PRB Position is Unsurpassed Peabody Leads in Size, Productivity and Margins Source: Peabody Energy 2015 10-K Filing; Company data. Peabody largest producer and reserve holder in PRB 139 million tons shipped to ~100 facilities in more than 25 states Nearly 3 billion tons of reserves represe
Slide 8: Peabody Maintaining Industry-Leading PRB Gross Margins
Peabody Maintaining Industry-Leading PRB Gross Margins Source: Industry reports. Gross margins calculated for 2014 / 2015. Peabody historic PRB gross margins more than 70% above peer average Driven by contracting strategies, strategic reserve investments and cost reductions Leveraging previous inves
Slide 9: Illinois Basin Portfolio Well Positioned
Illinois Basin Portfolio Well Positioned: Anchored by Key Mines Operations Well Capitalized From Previous Investments Source: Peabody Energy 2015 10-K Filing. Operations strategically located to serve local customer base 21 million tons shipped in 2015 Major emphasis on Indiana sub-region Bear Run M
Slide 10: Peabody Australian Platform Offers Long-Term Strategic Advantage
Peabody Australian Platform Offers Long-Term Strategic Advantage Competitive advantage with mines close to ports; Near high-growth regions Platform benefits from quality, location, lower AUD and costs Among leading producers of seaborne metallurgical coal Peabody is largest seaborne low-vol PCI supp
Slide 11: Peabody Sets New Company Record for Global Safety Performance
Peabody Sets New Company Record for Global Safety Performance Global Incidence Rate 13% Better Than 2014 Peabody’s 2015 global incidence rate of 1.25 reflects improvement at both surface and underground mines Continuing to invest in safety programs across the platform Safety A Way of Life Management
Slide 12: Focus on Business Priorities
Focus on Business Priorities
Slide 13: Notable 2015 Achievements
Against Brutal Industry Backdrop, Peabody Has Notable 2015 Achievements Achieved record global safety performance Improved unit costs even with lower volumes Reduced costs by 5% in U.S. Improved Australian costs 24% to lowest level for this platform Average gross margins of 26% across 4 of 5 segment
Slide 14: 2016 Core Priorities Build On Previous Successes
2016 Core Priorities Build On Previous Successes Across Organization Peabody benefits from unmatched asset base, strong underlying performance, strategic position of mines Core Priorities Drive Continuous Improvement in Safety, Productivity and Costs Preserve Liquidity and Reduce Debt Shape Portfoli
Slide 15: Financial Update
Financial Update North Antelope Rochelle Mine
Slide 16: Depressed Markets Pressure Earnings Despite Strong Operating Performance
Depressed Markets Pressure Earnings Despite Strong Operating Performance 2015 Adjusted EBITDA 2014 Adjusted EBITDA U.S. Mining $937 $1,083 Australian Mining $175 $113 Hedging $(437) $(50) SG&A $(176) $(227) Other $(64) $(105) Adjusted EBITDA $435 $814 Australian Mining increases $62 million over pri
Slide 17: Liquidity as of February 29, 2016
Liquidity as of February 29, 2016 The Company is assuming total LC / cash collateral requirements of $1.03B by the end of 1Q16.
Slide 18: U.S. Reclamation Bonding
As of February 29, 2016, Peabody had approximately $1.4B of uncollateralized corporate guarantees (i.e., self-bonds), as well as $310M of surety bonds outstanding to secure its U.S. reclamation obligations. U.S. Reclamation Bonding
Slide 19: DIP Financing
DIP Financing
Slide 20: DIP Budget – Key Assumptions
DIP Budget – Key Assumptions The committed tons assumptions below represent the amounts assumed for purposes of the DIP Budget. Although 2016 U.S. production is fully committed in the 150Mt to 160Mt range, run rates during the 1st Quarter have been below the committed levels. PCI includes the result
Slide 21: DIP Budget – Summary Projections
DIP Budget – Summary Projections The increase in capital expenditures in 2017 is primarily related to mine life extensions in Australia.
Slide 22: Peabody Energy Benefits from Multiple Strengths and Improvement Initiatives
Peabody Energy Benefits from Multiple Strengths and Improvement Initiatives
Slide 23: Appendix
S| ENERGY —— Appendix Peahony Rawhide Mine
Slide 24: Disclaimer
Disclaimer Peabody or its affiliates and representatives make no representation or warranty, express or implied, as to any matter reflected in or relating to this presentation. Certain statements and information in this presentation are forward-looking in nature and based on numerous assumptions tha
Slide 25: Powder River Basin: Largest Producer and Reserve Holder
Powder River Basin: Peabody the Largest Producer and Reserve Holder 2015 2014 Number of Mines 3 3 Sales Volumes 138.8 142.6 Revenues per Ton $13.45 $13.49 Costs per Ton $9.97 $9.92 Margin per Ton $3.48 $3.57 Gross Margin (%) 26% 26% Gross Margin ($) $483.0 $509.1 Reserves 2.960 billion tons Surface
Slide 26: Illinois Basin Overview
Illinois Basin Overview 2015 2014 Number of Mines 10 9 Sales Volumes 21.2 25.0 Revenues per Ton $46.18 $47.99 Costs per Ton $33.49 $35.70 Margin per Ton $12.69 $12.29 Gross Margin (%) 27% 26% Gross Margin ($) $269.0 $307.3 Reserves 1.99 billion tons Surface and underground mining methods 2015 sales
Slide 27: Western U.S. Mines Serve Local Customers
Western U.S. Mines Serve Local Customers, Many With Long-Term Contracts 2015 2014 Number of Mines 3 4 Sales Volumes 17.9 23.8 Revenues per Ton $38.09 $37.90 Costs per Ton $27.78 $26.69 Margin per Ton $10.31 $11.21 Gross Margin (%) 27% 30% Gross Margin ($) $184.5 $266.8 Reserves 526 million tons Surf
Slide 28: Australian Met Mines Provide Coking Coal and PCI
Australian Met Mines Provide Coking Coal and PCI to Asian Steel Markets 2015 2014 Number of Mines 7 7 Sales Volumes 15.7 17.2 Revenues per Ton $75.04 $93.81 Costs per Ton $76.20 $102.60 Margin per Ton $(1.16) $(8.79) Gross Margin (%) (2%) (9%) Gross Margin ($) $(18.2) $(151.2) Reserves 599 million t
Slide 29: Australian Thermal Mines Provide Thermal Coal
Australian Thermal Mines Provide Thermal Coal to Asian Generating Plants 2015 2014 Number of Mines 3 3 Sales Volumes 20.1 21.0 Revenues per Ton $41.00 $50.46 Costs per Ton $31.36 $37.87 Margin per Ton $9.64 $12.59 Gross Margin (%) 24% 25% Gross Margin ($) $193.8 $264.4 Reserves 262 million tons Surf
Slide 30: Aggressive SG&A and CapEx Reductions in Recent Years
Aggressive SG&A and CapEx Reductions in Recent Years Selling & Administrative Expenses Capital Expenditures Source: Peabody Energy 2015 and 2014 10-K filings. Values in millions. SG&A Lowest Levels in Nearly a Decade; Capex Lowest Since IPO
Slide 31: Reclaimed Mining Lands Sustain Farmland, Wildlife and Communities
Reclaimed Mining Lands Sustain Farmland, Wildlife and Communities Extensive planning required in advance of mining activity Contemporaneous land restoration ensures smallest active area for mining operations Peabody has pioneered agricultural practices to return mined land to highly productive farml
Slide 32: Lender Overview March 2016
Lender Overview March 2016 Peabody SI ENERGY
Slide 33: Overview of DIP Budget April 12, 2016
Overview of DIP Budget April 12, 2016
Slide 34: Disclaimer
Disclaimer Peabody or its affiliates and representatives make no representation or warranty, express or implied, as to any matter reflected in or relating to this presentation. Certain statements and information in this presentation are forward-looking in nature and based on numerous assumptions tha
Slide 35: DIP Budget – Summary Projections – 2016
DIP Budget – Summary Projections – 2016 5 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 2016 ($ Millions) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec FY Operational EBITDAR (Excl. Restructuring / Hedging) 39 $ 28 $ 26 $ 15 $ 28 $ 24 $ 34 $ 29 $ 30 $ 33 $ 35 $ 45 $ 367 $ Working Cap
Slide 36: DIP Budget – Summary Projections – 2017
DIP Budget – Summary Projections – 2017 36 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 ($ Millions) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec FY Operational EBITDAR (Excl. Restructuring / Hedging) 32 $ 24 $ 19 $ 24 $ 32 $ 28 $ 33 $ 31 $ 29 $ 28 $ 30 $ (2) $ 308 $ Working C
Slide 37: DIP Budget – 13 Week Cash Flow Forecast
DIP Budget – 13 Week Cash Flow Forecast 37 Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9 Week 10 Week 11 Week 12 Week 13 Total ($ in millions) 4/22 4/29 5/6 5/13 5/20
Peabody Energy — Debt Investor Presentation (April 2016) on 6ix