Coronado Global Resources Inc. · ASX:CRN
Coronado Global Resources — HY 2022 Earnings Presentation
52 slides from Coronado Global Resources's earnings presentation, Aug 9, 2022
Slide 1: Half Year Results and Investor Presentation
ASX Announcement 9 August 2022 Half Year Results and Investor Presentation Coronado Global Resources Inc. (ASX: CRN) releases the attached: • 2022 Half Year Results Announcement; and • 2022 Half Year Results Investor Presentation – Ends – This announcement was authorised to be given to ASX by the Bo
Slide 2: 2022 Half Year Results
ASX ANNOUNCEMENT - 2022 HALF YEAR RESULTS 9 August 2022 Record half year financial results: ✓ Revenue US$1,980m, Net Income US$562m, Adjusted EBITDA US$849m, Group Average Realised Met Coal Price US$293/tonne ✓ Strong Net Cash position of US$171m and Available Liquidity of US$586m ✓ Half year divide
Slide 3: Results and Guidance
• Available liquidity of $585.6 million at 30 June 2022, comprising $485.6 million of cash (excluding restricted cash) and $100.0 million of undrawn funds under the Asset Based Loan (ABL) facility. • Sales and Production volumes lower than prior year due to wet weather impacts, geological issues and
Slide 4: Financial Performance and Capital Management
Safety results have improved year on year due to several factors, including hazard identification and critical control verification programs, effectiveness audits and enhanced training programs. Reportable rates in Australia and the U.S. remain below the relevant industry averages. New and revised h
Slide 5: Operations
Following the payment of the HY22 dividend, Coronado will have distributed $477 million in cash dividends to Shareholders in the calendar year, and $1.2 billion in cumulative dividends since listing on the ASX in October 2018. The Company also announces an offer to purchase up to $25.2 million of th
Slide 6: Sustainability
This realised price includes the $187 per metric tonne (FOR) price on domestic contracts received for FY22 U.S. volumes. The Australia average realised Met coal price per metric tonne sold, across all grades of Met coal produced from the Curragh operation, was $329.4 per metric tonne (FOB basis), up
Slide 7: Metallurgical Coal Market Outlook
METALLURGICAL COAL MARKET OUTLOOK 1 Interest in spot cargoes of Met Coal reduced significantly late in HY22 as steel production decreased globally and Australian coal supply improved. Covid-19 lockdowns in China have also led to disruptions to logistics along the steel value chain, including the sup
Slide 8: Detailed Review Reference
Mining Cost per Tonne Sold guidance for FY2022 is revised to $79.0 - $81.0 due to unforeseen events outside of our control including global inflationary pressures exceeding original budget estimates and year- to-date wet weather impacts and geological issues impacting production. Inflation levels at
Slide 9: Cautionary Notice Regarding Forward-Looking Statements
Cautionary Notice Regarding Forward–Looking Statements This report contains forward-looking statements concerning our business, operations, financial performance and condition, the coal, steel and other industries, as well as our plans, objectives and expectations for our business, operations, finan
Slide 10: Mining and Operating Costs Per Tonne Reconciliation
MINING AND OPERATING COSTS PER TONNE RECONCILIATION For the six months ended 30 June 2022 United Other / Total (In US$’000, except for volume data) Australia States Corporate Consolidated Total costs and expenses 794,901 407,125 18,837 1,220,863 Less: Selling, general and administrative expense - -
Slide 11: Realised Pricing, Adjusted EBITDA and Net Cash Reconciliation
REALISED PRICING RECONCILIATION For the six months ended 30 June 2022 (In US$’000, except for volume data) Australia United States Consolidated Total Revenues 1,183,686 796,143 1,979,829 Less: Other revenues (19,042) (3,162) (22,204) Total coal revenues 1,164,644 792,981 1,957,625 Less: Thermal coal
Slide 12: 2022 Half Year Results Presentation
2022 Half Year Results Presentation GERRY SPINDLER Managing Director and CEO GERHARD ZIEMS Group Chief Financial Officer 9 August 2022 (All units in USD and metric tonnes, unless otherwise stated)
Slide 13: Important Notices and Disclaimer
Important Notices and Disclaimer The material contained in this presentation is intended to be general background information on Coronado Global Resources (Coronado) and its activities. The information is supplied in summary form and is therefore not necessarily complete. It is not intended that it
Slide 14: Leading International Producer of Met Coal
The leading international producer of high-quality metallurgical coal, an essential element in the production of steel. 3
Slide 15: Metallurgical Coal has a Long-Term Future
Metallurgical Coal has a Long-Term Future Steel is essential in all low-carbon technologies and underpins renewable energy infrastructure future (1) Total Global Crude Steel Production (Bt) (2) Total Global Crude Steel Production Method (2) +15% 2022 2050 2.2 EAF / Other EAF / Other 1.9 31% 46% 54%
Slide 16: Safety is the Most Important Aspect
‘Safety is the most important aspect of our operations and is our number one priority’ 5
Slide 17: Health, Safety and Community
Health, Safety and Community Safety is Coronado’s #1 core value and remains our highest priority Australian Operations (TRIFR) Australian Operations (TRIR) Industry average (TRIFR) 11 9 7 5 3 1 US Operations (TRIR) 4 U.S. Operations (TRIR) Industry average (TRIR) 3 2 1 Notes: Total Recordable Injury
Slide 18: HY 2022 Summary Results
Review images HY 2022 Summary Results GERRY SPINDLER MANAGING DIRECTOR AND CEO 7
Slide 19: HY 2022 Financial Results
HY 2022 Financial Results Record Revenue, Realised Price, Net Income and Adjusted EBITDA Group Dashboard Record Group revenue of $1,980 million, up $1,179 million, or 147%, compared to HY HY 2022 Actual HY 2021 Actual Variance 2021. Revenue $1,979.8M $800.4M $1,179.4M Record Net Income of $562 m
Slide 20: HY 2022 Group Operational Performance
HY 2022 Group Operational Performance Second half of 2022 weighted production plans ROM Production (Mt) Export Volume Mix (%) 15 13.7 HY22 HY21 HY22 HY21 12.2 14.0% 9.0% 10 7.2 15.0% 5.8 Export 19.0% 5 AUS Domestic 3.3 3.5 3.1 3.0 U.S. Domestic 67.0% 76.0% 0 Curragh Buchanan Logan Group Saleable Pro
Slide 21: Share Price Performance and Dividend Yield
Share Price Performance / Dividend Yield Coronado share price and dividend payments have outperformed the market Share Price Performance vs Index (1) Dividend Yield (2) 200% 23.1% 180% 160% 140% 120% 100% +90% 80% 60% 40% 4.1% 20% 0% -10% 1.4% -20% -12% Jul21 Aug21 Sep21 Oct21 Nov21 Dec21 Jan22 Feb2
Slide 22: Financial Performance and Capital Management
Financial Performance & Capital Management GERHARD ZIEMS GROUP CHIEF FINANCIAL OFFICER
Slide 23: Capital Management
Capital Management Coronado’s capital management strategy focuses on maintaining a strong balance sheet, sustainable profits and investment flexibility through volatile price cycles, underpinned by operating safe and reliable operations that produce high-quality Met coal for our customers 1. Strong
Slide 24: Capital Management Delivery
Capital Management Delivery Restructure of our financing arrangements in the past 12 – 18 months has allowed us to take advantage of the improved markets and weather recent headwinds Revenue Adjusted EBITDA Operating Cash Flows Net Cash / (Debt) +147% +3,205% +811% +172% 1,980 849 518 171 123 385 1,
Slide 25: HY 2022 Cash Flows and Liquidity
HY 2022 Cash Flows and Liquidity ($M) Strong HY22 Free Cash Flow generation; Available liquidity of $586 million HY 2022 Free Cash Flow Generation Available Liquidity Coronado generated $518 million in 849 Operating Cash Flows and $423 million in 586 Free Cash Flow after capital expenditure and ot
Slide 26: HY 2022 Dividend and Notes Purchase Offer
HY 2022 Dividend and Notes purchase offer Coronado declares an ordinary dividend of $125.7 million (USD 7.5 cents / CDI) and commences Senior Secured Notes purchase offer of $25.2 million Q1 2021 HY 2022 HY 2022 Key Dates unaccepted Fixed Ordinary Notes purchase 9 August 2022 Dividend Dividend Dec
Slide 27: Dividend and Notes Purchase Offer Continued
HY 2022 Dividend and Notes purchase offer (continued) Payments and declarations aligned with 60% - 100% Free Cash Flow distributions policy Record HY 2022 results and strong HY 2022 liquidity underpin dividends paid and $423 million Free Cash Flow declared year-to-date. HY 2022 Free Cash Flow ge
Slide 28: FY 2022 Revised Guidance
FY 2022 Revised Guidance Coronado reiterates revised guidance metrics Metric Original FY 2022 Revised FY 2022 Saleable Production anticipated to be at Guidance Guidance the low-end of guidance. Production weighted to the second half of 2022 Saleable Production (Mt) 18.0 – 19.0 18.0 – 19.0 (low-end
Slide 29: Metallurgical Coal Markets
Update for HY Metallurgical Coal Markets HY21 Results Presentation 18 18
Slide 30: Unique Diversification Advantage
Coronado has a Unique Diversification Advantage Coronado supports Met coal customers on five continents HY 2022 Met coal product offering Customers – direct sales(5) Australia(2),(3) U.S.(4) Key Met coal export destinations 5% 7% 3% 17% Asia 29% HCC Low Vol Americas 56% PCI 39% High Vol Europe SCC 5
Slide 31: Strong HY 2022 Met Coal Price Realisations
Strong HY 2022 Met Coal Price Realisations Met coal index is falling, Thermal coal index remains elevated Metallurgical Coal Price Indices (US$/t) (1) Coronado Average Met Coal Realised Price (US$/t) (3) 700 +231% H1 2021 H1 2022 PLV HCC FOB AUS LV HCC FOB USEC +193% PLV HCC CFR China NEWC Thermal +
Slide 32: Steel Demand Outlook Remains Firm
Steel Demand Outlook Remains Firm India steel production rates anticipated to grow year-on-year due to its significant potential for urbanisation and industrialisation Annual Forecast GDP Growth Percentage (1) India Total Crude Steel Production (Mt) (2) 7.0 402.9 2022 2023 5.9 5.6 +225% 3.7 3.1 184.
Slide 33: Strong Metallurgical Coal Demand Through 2050
Strong Metallurgical Coal Demand Through 2050 Growth for seaborne Met coal is underpinned by Indian demand and blast furnace production Seaborne Met Coal Supply (Mt) Seaborne Met Coal Demand (Mt) Global seaborne Met coal demand is forecast to grow 24% to 396 million tonnes by 2050, led primarily b
Slide 34: Strategy / Growth Plans
Strategy / Growth Plans GERRY SPINDLER MANAGING DIRECTOR AND CEO 23
Slide 35: Reserves and Resources
Reserves & Resources (Mt) Coronado maintains long-life operating assets ~20 years Reserves (Mt) Resources (Mt) 1,000 2,500 822 2,119 800 2,000 600 1,500 937 400 1,000 266 197 514 200 160 137 500 264 190 159 50 55 12 0 0 Notes: Charts reflect reserves and resources as at 31 December 2021 in millions
Slide 36: Key Focus Areas for Second Half 2022 and 2023
Key focus areas for second half 2022 and 2023 As one of the largest independent producers of Met coal globally, Coronado is inherently focused on maintaining safe operations and delivering production plans Safety Production Financial/Corporate Coronado will drive a strong safety Coronado is focused
Slide 37: Growth - Australian Operations
Growth - Australian Operations ‘One Curragh Plan’ will target 13.5 Mt of production by 2025 – On Target Curagh achievements and key areas of Estimated Production Profile (Mt) focus: ✓ New management with clarity of +22% purpose and strategy 13.5 ✓ CHPP capacity to produce 13.5Mt is already in place.
Slide 38: High Wall Mining - Curragh North
High Wall Mining – Curragh North Commenced operation on 11 July 2022 The High Wall Miner (HWM) enters the coal seam directly from the pit floor. HWM can mine to a maximum depth of 400 meters and utilises a purpose-built continuous miner. The HWM system uses conveyor cars to convey the Met coal
Slide 39: Productivity Improvements from Draglines and Fleets
Productivity improvements from Draglines and converted fleets Largest pieces of critical machinery now owned and operated by Coronado directly Capital investment in box-cuts and completed planned maintenance on Draglines in HY 2022 now resulting in approximately 10% productivity improvements New
Slide 40: Growth - U.S. Operations
Growth - U.S. Operations Growth plans at our High-Quality Buchanan and Logan Met mines on track Estimated Production Profile (Mt) Buchanan: Construction of new raw coal storage +10% areas underway to increase capacity and decrease bottlenecks. 6.9 Installation of additional skips 6.3 Preparati
Slide 41: Mon Valley Development Project
Mon Valley Development Project Strategic greenfield development opportunity in Southwest Pennsylvania Located 22.5km southeast of Pittsburgh ▪ Reserves: 197 Mt of Reserves ▪ Production Capacity: >2 Mt per year ▪ Coal Quality: High-Vol HCC ▪ Transportation: Barge with alternate rail access on CSX ▪
Slide 42: Coronado 2021 Sustainability Report
Coronado 2021 Sustainability Report https://coronadoglobal.com/sustainability/ 31
Slide 43: Sustainability Actions and Commitments
Sustainability Actions and Commitments Coronado takes its Environmental, Social and Governance responsibilities seriously Zero Coronado has a directional intent to have net zero operational emissions by 2050. ‘Coronado strives to be a socially and environmentally conscious 30% Coronado commits to a
Slide 44: Buchanan Ventilation Air Methane Abatement Project
Buchanan Ventilation Air Methane (VAM) Abatement Project Project underpins Coronado 30% emission reduction target by 2030 Buchanan mine VAM project officially commenced on 27 July 2022 Project utilises the latest technology to convert fugitive methane gas emissions to carbon dioxide Project wi
Slide 45: A Pure-Play Metallurgical Coal Company
‘A pure-play metallurgical coal company ready to Curragh Mine Logan Mine embrace the next stage of growth’ Buchanan Mine 3434
Slide 46: Questions
Questions 35
Slide 47: Supplementary Information
Supplementary Information Coronado @y STEEL STARTS HERE
Slide 48: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP measures This report, which includes a discussion of results of operations, includes references to and analysis of certain non-GAAP measures (as described below), which are financial measures not recognized in accordance with U.S. GAAP. Non-GAAP financial measures are used
Slide 49: Reconciliation of Non-GAAP Measures Continued
Reconciliation of Non-GAAP measures (continued) For the six months ended For the six months ended For the six months ended For the six months ended For the six months ended Adjusted EBITDA reconciliation 30 June 2022 31 December 2021 30 June 2021 31 December 2020 30 June 2020 (US$ Thousands) Net Inc
Slide 50: Reconciliation of Non-GAAP Measures Continued
Reconciliation of Non-GAAP measures (continued) For the six months For the six months Realised Met Pricing reconciliation for the six Realised Total Pricing reconciliation ended ended Australia United States Consolidated 30 June 2022 30 June 2021 months ended 30 June 2022 (US$ Thousands, except for
Slide 51: Reconciliation of Non-GAAP Measures Continued
Reconciliation of Non-GAAP measures (continued) Mining Costs per tonne reconciliation for the six months ended 30 June 2022 Australia United States Other/Corporate Total (US$ Thousands, except for volume data) Total costs and expenses 794,901 407,125 18,837 1,220,863 Less: Selling, general and admin
Slide 52: Contacts
CONTACTS Investors: Registered Office: Andrew Mooney Coronado Global Resources Inc. Vice President Investor Relations & Communications Level 33, Central Plaza One, 345 Queen Street P: +61 458 666 639 Brisbane, QLD, Australia, 4000 E: amooney@coronadoglobal.com (GPO Box 51, Brisbane, QLD, Australia,
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