Slide 1: Bathurst Resources Limited
BATHURST RESOURCES LIMITED New Zealand’s leading coal group Investor presentations – September 2019
Slide 2: Disclosure
DISCLOSURE General disclaimer This presentation contains forward-looking statements. Forward-looking statements often include words such as “anticipate”, “expect”, “intend”, “plan”, “believe”, “guidance” or similar words in connection with discussions of future operating or financial performance, th
Slide 3: NZ's Leading Coal Producer and Exporter
NZ’S LEADING COAL PRODUCER AND EXPORTER Quick facts Domestic Operations 5 operating mines – 3 via a 65% Corporate offices owned joint venture Mine in care & maintenance Maramarua Markets Export and domestic Distribution centre Production under management FY20 2.2Mt Export Revenue by market FY20 60%
Slide 4: Capital Management
CAPITAL MANAGEMENT Capital structure Substantial shareholders 31 August 2019 Currency Value Share price AUD 10.5¢ Market cap AUD $179m Borrowings1 (excl. leases) USD $7.9m Cash incl. restricted deposits NZD $43.5m Capital initiatives Initiative Price per share Cost On-market share buy-back2 AU 12.8¢
Slide 5: Key Results
KEY RESULTS Investments in two key Record EBITDA – $106.6m growth projects 14% New capital initiatives in Receipt of innovation share buy-backs award Record NPAT $45.0 million Maiden dividend $39.5 million announced Financial figures noted above are based on 30 June 2019 audited financial statements
Slide 6: High Standards in HSEC
HIGH STANDARDS IN HSEC Zero major environment incidents; 18 minor incidents • Life of mine integration plans commenced at all sites. BRL TRIFR1 = 8.0 • Four lost time injuries. 40.0 BRL TRIFR 1 = 8.0 • >3,200 hours of risk management training. 30.0 • >85,000 risk tools used. 20.0 Zero occupational h
Slide 7: Key Financials: Strong Performance
KEY FINANCIALS: STRONG PERFORMANCE A general uplift in results reflect a full 12 months of BT Mining (pcp 10 months). A stable domestic business with long-term contracts, and an export segment that operates at low cost to take full advantage of export coal price uplifts, show that Bathurst is a repe
Slide 8: FY20 EBITDA Guidance $78.4m
FY20 EBITDA GUIDANCE $78.4M • The export segment is the Measure Export North Island South Bathurst Prior period key driver in the decrease (Stockton) domestic Island equity share actuals in forecast FY20 EBITDA domestic FY20 FY19 from FY19. EBITDA1 $69.9m $39.2m $7.5m $78.4m $106.6m • The budget for
Slide 9: Capital Guidance
CAPITAL GUIDANCE • Financing cashflows will be FY20 key projects over $500k North Island South Island Corporate domestic domestic consistent to FY19, with the exception of the repayment Componentry spend on yellow $5.7m $1.4m - of the USD bonds (face goods Crown Mountain $3.9m value USD $7.9m) in Fe
Slide 10: Strategic Focus
STRATEGIC FOCUS The role of coal in the industrial world continues to be an important contributor to the both developed and developing economies. There is no replacement for coal when it comes to steel making; likewise there is currently no other financially viable energy source in the South Island,
Slide 11: LMCH Case Update
LMCH1 CASE UPDATE Background • On 20 August 2018 the High Court found in favour of LMCH regarding a disputed USD $40m performance payment under the Buller project Sale and Purchase Agreement (SPA) of 2010. • An appeal was lodged to the Court of Appeal against the finding of a number of grounds. • We
Slide 12: Export - Stockton (65% BRL)
EXPORT - STOCKTON (65% BRL1) Stockton is an open cut mine producing a low-ash metallurgical coal for export Sales (FY20) 1.2Mt Unit Cost (FOB) (FY20) $107/tonne EBITDA $69.9m Crown rehab indemnity $46.4m Resource 68.2Mt Reserve 9.3Mt Infrastructure • 1.8Mtpa CHPP • 2.5km aerial ropeway • 2.2Mtpa rai
Slide 13: Export Market Update
EXPORT MARKET UPDATE Coking coal market undergoing a price correction following a period of high raw material prices • Chinese steel production has been strong despite the uncertainty of US / China Trade war. • Chinese port restrictions and quotas on seaborne coal continues to impact demand out of C
Slide 14: Our Export Coal & Market Strategy
OUR EXPORT COAL & MARKET STRATEGY Our coal • Very low ash content. characteristics • Almost all vitrinite. • Blend improver. Value in use focus Our coal is marketed on a ‘Value In Use’ basis to maximise value to customers and price. Diversification Diversified geographic markets, end products, prici
Slide 15: Stockton Organic Growth Project (65% BRL)
STOCKTON ORGANIC GROWTH PROJECT (65% BRL ) 1 A natural southern extension of Stockton • Development of open cut pits within the Upper Waimangaroa permit, incorporating comparable coal within the BRL Buller exploration permit. • High value resource which enables blending to maintain coking coal expor
Slide 16: Buller Export Growth Project (100% BRL)
BULLER EXPORT GROWTH PROJECT (100% BRL) The combination of the Stockton assets with Bathurst’s existing Buller Plateau assets will unlock material synergies Item With Without Synergies Synergies CHPP nil $100m Access to Rail $6m $50m Rail loadout nil $25m Water $3m $3m treatment Workshops etc $1m $1
Slide 17: Domestic: High Quality, Low Ash Coal
DOMESTIC: HIGH QUALITY, LOW ASH COAL Our open cut mines produce high-quality, low-ash coal for the local steel market and food and other processing industries. Key info North Island 1 South Island Sales (FY20) 800kt 312kt EBITDA2 (FY20) $39.2m $7.5m Crown rehab indemnity $15.1m n/a Resource 12.1Mt 1
Slide 18: Domestic Growth Project - Ruawaro (65% BRL)
DOMESTIC GROWTH PROJECT - RUAWARO (65% BRL ) 1 • Development of an open cut mine within the Ruawaro permit 40698 adjacent to current Rotowaro operations. • Utilise existing infrastructure to access the established customer base. • Project prefeasibility continues to be advanced, with economic evalua
Slide 19: Canadian Growth Project: Crown Mountain
CANADIAN GROWTH PROJECT: CROWN MOUNTAIN Crown Mountain is a joint venture with Jameson Resources Limited Key project information Detail JV structure assuming all investment Location Mature mining region in British Columbia with well established transport infrastructure. stages reached Economics1 Low
Slide 20: Bathurst/Crown Mountain Strategic Fit
BATHURST/CROWN MOUNTAIN STRATEGIC FIT Context of Bathurst’s current operations Domestic • There is no real opportunity for growth in the domestic thermal market. • Demand is relatively stable, and Bathurst already holds a market dominant position. • There is one steel plant on the North Island which
Slide 21: Sustained Long Term Company Growth
SUSTAINED LONG TERM COMPANY GROWTH Graph assumptions: BRL production tonnes (100% basis) by market • Assumes the Buller Project, Stockton organic growth project, Ruawaro, and Crown Mountain coming online. • New projects would potentially add to forecast production levels. • Domestic business continu
Slide 22: Appendix: Resources
APPENDIX: RESOURCES 2018 2017 2018 2017 2018 2017 2018 2017 Bathurst Measured Measured Indicated Indicated Inferred Inferred Total Total Area Mineral Change (Mt) Change (Mt) Change (Mt) Change (Mt) Resource Resource Resource Resource Resource Resource Resource Resource Ownership (Mt) (Mt) (Mt) (Mt)
Slide 23: Appendix: Coal Reserves (ROM) Tonnes
APPENDIX: COAL RESERVES (ROM) TONNES Bathurst Proved (Mt) Probable (Mt) Total (Mt) ROM Coal Mineral Area 2018 2017 Change 2018 2017 Change 2018 2017 Change Ownership Escarpment Domestic (11, 13, 16 & 18) 100% 0.2 0.2 0.0 0.1 0.1 0.0 0.3 0.3 0.0 Escarpment Export (11,13, 16 & 18) 100% 2.3 2.3 0.0 0.5
Slide 24: Appendix: Marketable Coal Reserve Tonnes
APPENDIX: MARKETABLE COAL RESERVE TONNES Bathurst Proved (Mt) Probable (Mt) Total (Mt) Product Coal Mineral Area 2018 2017 Change 2018 2017 Change 2018 2017 Change Ownership Escarpment Domestic (11, 13, 16 & 18) 100% 0.2 0.2 0.0 0.1 0.1 0.0 0.3 0.3 0.0 Escarpment Export (11,13, 16 & 18) 100% 1.9 1.9
Slide 25: Competent Persons Statement
COMPETENT PERSONS STATEMENT Bathurst Resources Competent Person Statement The information on this report that relates to mineral resources for Deep Creek and the mineral reserves for Escarpment Export, Stockton, Upper Waimangaroa and Whareatea West is based on information compiled by Sue Bonham-Cart