Suncoke Energy, Inc. · NYSE:SXC
Suncoke Energy — Q2 2015 Earnings Presentation
22 slides from Suncoke Energy's earnings presentation, Jul 21, 2015
Slide 1: SunCoke Energy, Inc. Q2 2015 Earnings, M&A Announcement
SunCoke Energy, Inc. Q2 2015 Earnings, M&A Announcement Conference Call July 21, 2015
Slide 2: Forward-Looking Statements
Forward-Looking Statements TM This slide presentation should be reviewed in conjunction with the Second Quarter 2015 earnings release of SunCoke Energy, Inc. (SXC) and the conference call held on July 21, 2015 at 10:00 a.m. ET. Some of the information included in this presentation constitutes “forwa
Slide 3: Management Perspective
Management Perspective TM Delivered operating results in line with calendar year targets Significantly increased dividend, raising quarterly rate 100% SXCP’s highly accretive Convent Marine Terminal acquisition expected to substantially grow distributions into 50/50 IDR splits Reached agreem
Slide 4: Q2 '15 Overview
Q2 ‘15 Overview TM Q2 2015 Earnings Overview Consol. Adj. EBITDA excluding one-time, ($ in millions) Consolidated Earnings per Share ($/share) non-cash items(2) down ~$10M vs. Q2 ‘14 Adj. EBITDA(1) (diluted) • Pull forward in timing of planned ($0.21) maintenance outage at Granite City ($0.27) • Und
Slide 5: Adjusted EBITDA – Q2 '14 to Q2 '15
(1) Adjusted EBITDA – Q2 ‘14 to Q2 ‘15 TM Consol. Adj. EBITDA, excluding one-time non-cash charges, down ~$10M ($ in millions) $56.3 (2) ($4.5) ($4.1) $46.0 ($4.0) ($1.3) ($0.9) (4) $12.6 • ($4.6M) – Indiana Harbor $60.8 cost under-recovery, net $33.4 • ($1.1M) – Corp. & Other • $0.2M – Internationa
Slide 6: Domestic Coke Business Summary
Domestic Coke Business Summary TM Below target improvement at Indiana Harbor and Granite City outage impacted Q2 results; however, reaffirm full year guidance Domestic Coke Production and Adjusted EBITDA Per Ton(1) Continued ramp-up of (Production in thousands of tons, $ in per ton amounts) $67/ton
Slide 7: Liquidity Position
Liquidity Position TM Strong cash position and revolver capacity provide significant financial flexibility Attributable to SXCP $32.5 ($14.2) $201.7 ($4.9) ($9.6) $26.4 • ($8.8M) – Ongoing $165.4 • ($5.4M) – Environmental & Expansion $12.6 ($6.5) $98.9 SXCP revolver $91.8 availability: $250M • $13.1
Slide 8: Strategic Updates
STRATEGIC UPDATES SXC Q2 2015 Earnings and M&A Announcements Call 7
Slide 9: SXCP's Convent Marine Terminal Acquisition
SXCP’s Convent Marine Terminal Acquisition TM SunCoke Energy Partners to acquire premier Illinois Basin coal export terminal for $412M Asset Overview Acquisition Highlights • Large, efficient, well-capitalized Gulf Coast Provides excellent fit with long-term growth strategy & export terminal in Co
Slide 10: Significant CF Generation From Convent Acquisition
Significant CF Generation From Convent Acquisition TM Convent acquisition highlights value of GP structure, generating estimated $16M of incremental cash flow to SXC in 2016 Pro-Forma w/ Pro-Forma w/ Standalone Standalone(3) Convent(2) Convent(2) 2013 2014 2015E 2016E GP / IDRS(1) $1.2M $2.6M ~$6M ~
Slide 11: Executing Capital Allocation Strategy
Executing Capital Allocation Strategy TM Leveraging GP/LP structure and executing balanced capital allocation strategy Raised SXC dividend 100% to $0.15 per share, reflecting strategy to distribute significant portion of free cash flow • As we transition to pure-play GP, primary capital allocation s
Slide 12: SXC Investment Thesis
SXC Investment Thesis TM Execution against long-term growth strategy and capital allocation initiatives has reinforced SXC’s strong investment thesis Recent Value-Enhancing Actions Stable, Long-term Business Model SXCP’s highly accretive Convent Marine Terminal acquisition expected to substantiall
Slide 13: Questions
QUESTIONS SXC Q2 2015 Earnings and M&A Announcements Call 12
Slide 14: Investor Relations
Investor Relations 630-824-1907 www.suncoke.com
Slide 15: Appendix
APPENDIX SXC Q2 2015 Earnings and M&A Announcements Call 14
Slide 16: Definitions
Definitions TM Adjusted EBITDA represents earnings before interest, taxes, depreciation, depletion and amortization (“EBITDA”) adjusted for impairments, coal rationalization costs, sales discounts, and interest, taxes, depreciation and amortization attributable to our equity method investment. Prior
Slide 17: Consolidated Guidance Summary
Consolidated Guidance Summary TM Reaffirm Full Year 2015 Adjusted EBITDA Guidance; Updated Cash Taxes and Capital Expenditures Guidance Metric 2015 Guidance Adjusted EBITDA(1) Consolidated $190 – $210 million Attributable to SXC $115 – $130 million Capital Expenditures ~$80 million Was ~$90 million
Slide 18: Reconciliation to Adjusted EBITDA
Reconciliation to Adjusted EBITDA TM ($ in millions) Q2 '15 Q1 '15 FY '14 Q4 '14 Q3 '14 Q2 '14 Q1 '14 Net cash provided by Operating activities $65.5 $11.1 $112.3 $53.9 $33.1 $36.6 ($11.3) Depreciation, depletion and amortization expense 26.4 23.8 106.3 25.9 22.8 28.6 29.0 Loss on extinguishment of
Slide 19: Reconciliation of Segment Adjusted EBITDA and Adjusted EBITDA per ton
Reconciliation of Segment Adjusted EBITDA and Adjusted EBITDA per ton TM Reconciliation of Segment Adjusted EBITDA and Adjusted EBITDA per Ton Corporate, Domestic India Legacy Costs ($ in millions, except per ton data) Coke Brazil Coke Coke (1) Coal Mining Coal Logistics and Other Consolidated Q2 20
Slide 20: 2015E Guidance Reconciliation
2015E Guidance Reconciliation TM 2015E 2015E ($ in millions) Low High Net Income $21 $38 Income tax expense/(benefit) 5 10 Interest expense, net 66 64 Depreciation, depletion and amortization expense 94 94 Non recurring coal rationalization costs 1 1 Adjustment to unconsolidated affiliate earnings(1
Slide 21: Balance Sheet & Debt Metrics
Balance Sheet & Debt Metrics TM (1) As of 6/30/2015 Balance SXC Attributable Attributable Consolidated to SXCP ($ in millions) to SXC Cash $ 202 $ 99 $ 103 Revolver Capacity 398 250 149 Total Liquidity 600 349 251 Total Debt (Long and Short-term) 699 597 102 Net Debt (Total Debt less Cash) 497 498 (
Slide 22: Capital Expenditures
Capital Expenditures TM 2015 Expected CapEx ($ in millions) SXC SXCP(1) Consolidated Ongoing(2) $31 $20 $51 Expansion 7 0 7 Environmental Project 0 22 22 Total CapEx (Consolidated) $38 $42 $80 (1) Represents SXCP capex on 100% basis, including Granite City. (2) Consolidated includes approximately $4