Yancoal Australia Ltd. · ASX:YAL
Yancoal Australia — Morgan Stanley Asia Pacific Summit 2022
29 slides from Yancoal Australia's conference presentation, Nov 11, 2022
Slide 1: Company presentation ASX release
YANCOAL AUSTRALIA LTD ADDRESS: Level 18, Tower 2, 201 Sussex Street, Sydney NSW 2000 PHONE: 61 2 8583 5300 FAX: 61 2 8583 5399 WEBSITE: www.yancoal.com.au 10 November 2022 For personal use only ASX Release: Company presentation Authorised for lodgement by Yancoal Disclosure Committee Investor Relati
Slide 2: Morgan Stanley Asia Pacific Summit
For personal use only Yancoal Australia Ltd Morgan Stanley Asia Pacific Summit 16-18 1 November 2022
Slide 3: Important Notice and Disclaimer
Important Notice and Disclaimer Acceptance - This presentation is issued by Yancoal Australia Limited ABN 82 111 859 119 (“Yancoal”). By accepting, accessing or reviewing this presentation, you acknowledge and agree to the terms set out in this Important Notice and Disclaimer. For personal use only
Slide 4: Important Notice and Disclaimer (Continued)
Important Notice and Disclaimer (Continued) Reserves and Resources Reporting - In this presentation, references to mineral resources (“Resources”) and ore reserves (“Reserves”) for Yancoal are compliant with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserv
Slide 5: Yancoal Overview
Yancoal Overview Map of Yancoal operations Milestones in Yancoal’s growth For personal use only 18 years of growth through prudent acquisitions 4 * Managed, not owned, by Yancoal
Slide 6: Executive Leadership Team
Executive Leadership Team For personal use only 5
Slide 7: Dual listed on ASX and HKEx – fully fungible
Dual listed on ASX and HKEx – fully fungible Summary share register 2022 Share price activity For personal use only 8.00 40.00 Shareholders * Shares % of IC 7.00 35.00 Yankuang Energy 822,157,715 62.3 6.00 30.00 5.00 25.00 Cinda International 181,474,887 13.7 4.00 20.00 Directors & Management 645,12
Slide 8: The largest coal focused company on the ASX
The largest coal focused company on the ASX • In 2022, the total Australian saleable thermal coal production is ~207Mt. Yancoal’s equity For personal use only attributable thermal coal production is about 12% of the national total. * • Attributable coal production is the third largest, after BHP and
Slide 9: Yancoal operations summary
Yancoal operations summary • An interest in 7 producing coal mines and operates 2 mines on management contracts. For personal use only • Total annual production across the 9 mines is about 70 million tonnes of ROM coal and 55 million tonnes of Saleable coal, and nearly all the saleable coal enters t
Slide 10: Coal market conditions
Coal market conditions • 6,000kCal high-energy, low-ash thermal coal prices remain • Metallurgical coal prices are trending upwards elevated due to constrained supply and global energy market with supply concerns (Canada and Australia) For personal use only dynamics. and market corrections in relati
Slide 11: Price realisation elements
Price realisation elements • The Group’s export thermal Units 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 coal is generally priced on For personal use only either an index price, an API5, 5500kCal US$/t 55 62 96 118 172 194 195 annual fixed price or on a spot price basis; and export GC Newc, 6000kCal US$/t 8
Slide 12: Product mix and sales volume split
Product mix and sales volume split • Continually assesses the coal market conditions and 1H 2022 Final destination for coal volumes managed by Yancoal Marketing* its ability to best serve the customer requirements for For personal use only Other, 0.4% Other, 0.2% thermal and metallurgical coal. Sth
Slide 13: ROM Coal Production impacted by uncontrollable events
ROM Coal Production impacted by uncontrollable events ROM Production by Asset (100% basis)* • Total ROM mined (100% basis) during 9 For personal use only (Million tonnes) Moolarben MTW HVO months to 30 September was 39.0Mt. Yarrabee Stratford Duralie Middlemount Ashton Three years of La Nina weather
Slide 14: Saleable Coal Production positioned for recovery
Saleable Coal Production positioned for recovery Attributable Saleable Production by Asset * • 2022 has been impacted by persistent and For personal use only (Million tonnes) Moolarben MTW HVO heavy rainfall, which significantly affected the Yarrabee Stratford Duralie Ashton Non-attributable open-cu
Slide 15: Unit costs fluctuate on uncontrollable elements
Unit costs fluctuate on uncontrollable elements Cash operating costs (per production tonne) • The implied operating margin increased For personal use only (A$/tonne) Cash operating costs Royalty Implied operating cash margin sharply with the higher realised coal price. 350 • 1H 2022 Cash operating c
Slide 16: Record Prices, Revenue and EBITDA
Record Prices, Revenue and EBITDA Revenue and Average realised price EBITDA and Margin For personal use only (A$ Million) | (A$/tonne) (A$ Million) | (%) Total ex-mine coal revenue Average realised coal price Operating EBITDA EBITDA Margin 7,000 350 3,500 65% 314 6,000 300 3,000 5,000 250 2,500 45%
Slide 17: Profit and Operating cashflow up sharply from prior periods
Profit and Operating cashflow up sharply from prior periods Profit / (Loss) after tax Operating cash flow For personal use only (A$ Million) (A$ Million) Profit / (Loss) after tax Operating cash flow 2,000 3,000 1,738 2,750 1,500 2,500 1,000 852 791 719 2,000 1,900 1,747 500 1,548 1,500 - 1,000 (500
Slide 18: Rapid change in debt and gearing
Rapid change in debt and gearing Annual Net Debt* and Gearing Ratio** • Net cash position since July 2022. For personal use only (A$ Million) | (%) • At 30 September 2022 the cash position Net debt, A$ mn Net gearing, % was A$3.4bn, US$1.0bn was 4,000 subsequently repaid in October, leaving 41% less
Slide 19: Dividends – Shareholders are direct beneficiaries of coal prices
Dividends – Shareholders are direct beneficiaries of coal prices Dividend payment history • The 2022 interim dividend allocation was $696 For personal use only (A$ Million) | (%) Interim Div. Final Div. Special Div. Payout ratio million, A$0.5271 per share (unfranked). 1,000 118% • Combined with the
Slide 20: The Investment case
The Investment case For personal use only Three low-cost, large-scale assets underpin the business The capability to blend and wash coal products to maximise the market opportunity Diverse customer base that continues to demonstrate appetite for Yancoal product Capacity for rapid cash accumu
Slide 21: Additional information and appendices
For personal use only Additional information and appendices 20
Slide 22: Environment, Social and Governance (ESG)
Environment, Social and Governance (ESG) • Initiating a process to assess the setting of For personal use only targets across a range of ESG activities, particularly in relation to improving energy efficiency and workforce diversity rates. • Investigating enhanced systems and processes for the manag
Slide 23: 1H 2022 - Record Revenue and EBITDA
1H 2022 - Record Revenue and EBITDA For personal use only Effective COVID-19 response and sustained safety performance $4.8 billion Revenue 8.7 TRIFR 15.5Mt Attributable Saleable $3.2 billion Operating EBITDA Production & operating margin of 65% Average realised coal sales price Cash position of $3.
Slide 24: 1H 2022 - Key Result Drivers
1H 2022 - Key Result Drivers Operating factors 1H 2022 1H 2021 Change Observations For personal use only Average realised sales price 314 94 234% Strong coal price realisation despite lag effect (A$/t) Attributable production 15.5 17.5 -11% Impacted by rain events and COVID-19 disruptions (million t
Slide 25: 1H 2022 - Financial Summary – Record Revenue and EBITDA
1H 2022 -Financial Summary – Record Revenue and EBITDA Income Statement 1H 2022 1H 2021 Change Observations ($ millions) For personal use only Realised price more impactful than lower sales Revenue * 4,776 1,775 3,001 volume Higher revenue more impactful than higher operating Operating EBITDA 3,153
Slide 26: 1H 2022 - Improved Fiscal Position
1H 2022 - Improved Fiscal Position Cashflow and 1H 2022 1H 2021 Change Observations Balance Sheet For personal use only Operating cash flow Operating cash flow notably higher than 12 months 2,750 179 1436% ($ million) ago Cash at end of period 3,383 539 528% US$801mn debt repayment made in July 2022
Slide 27: 3Q 2022 Quarterly Production Report data
3Q 2022 Quarterly Production Report data Economic ROM COAL PRODUCTION, Mt Mine type Interest 3Q 2022 2Q 2022 PP Change 3Q 2021 PCP Change 9mth 2022 9mth 2021 Change Moolarben OC / UG 95% 4.0 4.4 -9% 5.3 -25% 13.3 15.4 -14% For personal use only Mount Thorley Warkworth OC 82.90% 3.6 2.6 38% 4.7 -23%
Slide 28: 4Q 2021 Quarterly Production Report data
4Q 2021 Quarterly Production Report data Economic ROM COAL PRODUCTION, Mt Mine type Interest 4Q 2021 3Q 2021 PP Change 4Q 2020 PCP Change 2021 2020 Change Moolarben OC / UG 95% 5.0 5.3 (6%) 5.0 -% 20.4 21.7 (6%) For personal use only Mount Thorley Warkworth OC 82.90% 4.4 4.7 (6%) 4.4 -% 16.5 17.6 (6
Slide 29: For personal use only
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