Lubelski Wegiel Bogdanka Sa · GPW:LWB
Lubelski Wegiel Bogdanka Sa — LW Bogdanka — H1 2017 Earnings Presentation
37 slides from Lubelski Wegiel Bogdanka Sa's earnings presentation, 2017
Slide 1: Presentation of results the LW Bogdanka Group Q2, IH 2017
Presentation of results the LW Bogdanka Group Q2, IH 2017 We are part of a modern capital group involved in raw materials and energy operations
Slide 2: The Management Board of LW Bogdanka SA
The Management Board of LW Bogdanka SA Krzysztof Szlaga President of the Management Board Stanisław Misterek Adam Partyka Sławomir Karlikowski Marcin Kapkowski Vice-President of the Vice-President of the Vice-President of the Vice-President of the Management Board, Management Board, Management Board
Slide 3: Agenda
Agenda Situation on the coal market and key operating data Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Performance of the plan in Q2, IH 2017 Appendices – Financial information 3
Slide 4: In the second quarter slight decline in global coal prices with a rise in domestic prices
In the second quarter slight decline in global coal prices with a rise in prices of thermal coal on the domestic market
Slide 5: Slight decreases in coal prices on the global market in Q2 2017 vs. Q1 2017
Situation on the coal market and key operating data Slight decreases in coal prices on the global market in Q2 2017 vs. Q1 2017 CIF ARA coal prices USD 77/tonne - the average annual coal price (CIF ARA) in Q2 2017, i.e. +57% 130,0 compared to Q2 2016 (USD 49/tonne) and +28% to annual average in 20
Slide 6: Increase in domestic coal prices in Q2 2017 by approx. 2% vs. Q1 2017
Situation on the coal market and key operating data Increase in domestic coal prices in Q2 2017 by approx. 2% vs. Q1 2017 13,0 12,5 12,0 11,5 11,0 Thermal coal prices 10,5 in Q2 2017, the average price of thermal coal for commercial power plants was PLN 9.10 per GJ – up by 1.9% compared to 10,0 Q1
Slide 7: Decrease in inventories and extraction, sales at the same level, increase in thermal coal prices
Situation on the coal market and key operating data Decrease in inventories and extraction, sales at the same level, increase in thermal coal prices in Poland in Q2 2017 compared to Q2 2016 PERFORMANCE OF POLISH COMPANIES*: Thermal coal: Q2 2016 Q2 2017 Change IH 2016 IH 2017 Change Extraction (mill
Slide 8: Drop in extraction and stocks of thermal coal in Polish mines, sales at the same level
Situation on the coal market and key operating data Drop in extraction and stocks of thermal coal in Polish mines, sales at the same level Thermal coal production, domestic sales Thermal coal imports and exports and inventories (million tonnes)* (million tonnes)* 27,0 25,1 3,2 3,2 24,2 23,9 2,9 2,0
Slide 9: We keep a very strong position on the coal market – 26.2% of share
Situation on the coal market and key operating data We keep a very strong position on the coal market – 26.2% of share in sales to commercial power plants 26,2% 25,4% 24,9% 22,5% 19,8% 19,3% 18,0% 16,6% 15,9% 14,8% 14,4% 13,9% 14,2% 13,7% 10,4% 9,9% 2010 2011 2012 2013 2014 2015 2016 IH 2017 Share o
Slide 10: Higher production and sales in LW Bogdanka S.A
Situation on the coal market and key operating data Higher production and sales in LW Bogdanka S.A Q2 2016 Q2 2017 Change IH 2016 IH 2017 Change Gross production (’000 3,187 3,128 -1.9% 6,920 6,757 -2.4% tonnes) Net production (’000 tonnes) 1,950 2,136 9.5% 4,285 4,558 6.4% New workings (by length)
Slide 11: Coal yield at a level of 68.3% in Q2 2017
Situation on the coal market and key operating data Coal yield at a level of 68.3% in Q2 2017 100,0% 90,0% 80,0% 70,0% 60,0% 50,0% 40,0% IQ IIQ IIIQ IVQ IQ IIQ IIIQ IVQ IQ IIQ IIIQ IVQ IQ IIQ IIIQ IVQ IQ IIQ IIIQ IVQ IQ IIQ IIIQ IVQ IQ IIQ 2011 2012 2013 2014 2015 2016 2017 Średnia Annualroczna aver
Slide 12: Agenda
Agenda Situation on the coal market and key operating data Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Performance of the plan in Q2, IH 2017 Appendices – Financial information 12
Slide 13: Good operating and financial results, cost efficiency
Good operating and financial results, cost efficiency
Slide 14: We achieved good operating results – increase of production and sales
Financial highlights of the LW Bogdanka Group in Q2, IH 2017 We achieved good operating results – increase of production and sales Item Unit IIQ 2016 IIQ 2017 Change IH 2016 IH 2017 Change Parametry techniczno – operacyjne ’000 Gross production 3,187 3,128 -1.9% 6,920 6,757 -2.4% tonnes ’000 Net pro
Slide 15: Higher coal sold and lower unit production cost – increase in EBITDA in Q2 2017
Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Higher amount of coal sold and a lower unit production cost – increase in EBITDA in Q2 2017 compared to Q2 2016 Q2 2017 [PLN million] Q2 2016 Q2 2017 Change increase in EBITDA by PLN 34.8 million (33.5%) increase in the volume of coal
Slide 16: Higher coal sold and lower unit production cost – increase in EBITDA in IH 2017
Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Higher amount of coal sold and a lower unit production cost – increase in EBITDA in IH 2017 compared to IH 2016 IH 2017 [PLN million] IH 2016 IH 2017 Change increase in EBITDA by PLN 41.2 million (14.9%) increase in the volume of coal
Slide 17: Increase in production by 9.5% in Q2 2017 and decrease of costs by type by 0.6%
Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Increase in production by 9.5% in Q2 2017 and decrease of costs by type by 0.6% Item [PLN ‘000] IIQ 2016 IIQ 2017 Zmiana IH 2016 IH 2017 Zmiana Net production [’000 tonnes] 1,950 2,136 9.5% 4,285 4,558 6.4% Coal sales [’000 tonnes] 2,195 2
Slide 18: Cost reduction brings further results – production higher by 6.4% in IH 2017
Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Cost reduction brings further results – production higher by 6.4% in IH 2017 compared to IH 2016 and a decrease in costs by type by 1.0% Total costs by type for IH 2017 – PLN 841.3 million – drop in relation to IH 2016 by 1.0%, i.e. by PLN
Slide 19: Provisions at the LW Bogdanka Group
Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Provisions at the LW Bogdanka Group Item 31.12.2016 30.06.2017 Change [PLN ’000] Employee provisions 266,981 304,242 14.0% Liabilities under local property 32,456 37,560 15.7% tax Mine decommissioning and 117,423 117,420 0.0% land reclamat
Slide 20: Change in provisions at the LW Bogdanka Group
Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Change in provisions at the LW Bogdanka Group Item Change Change Change Change Change Change [PLN ’000] Q2 2016 Q2 2017 IH 2016 IH 2017 Employee provisions 15,494 28,153 81.7% 9,230 37,261 303.7% Liabilities under local 2,125 2,337 10.0% 4
Slide 21: Agenda
Agenda Situation on the coal market and key operating data Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Performance of the plan in Q2, IH 2017 Appendices – Financial information 21
Slide 22: In Q2 2017, the production was in line with the assumed plan – 2.1 million tonnes
In Q2 2017, the production was in line with the assumed plan – 2.1 million tonnes
Slide 23: We completed the production plan of 2.1 million tonnes in Q2 2017
Performance of the plan in Q2, IH 2017 We completed the production plan assuming 2.1 million tonnes in Q2 2017 – increase over Q2 2016 by 9.5% PRODUCTION 10,0 approx. 9,0 - 9,2 plan 9,0 8,5 8,4 8,0 7,8 6,0 5,8 According to the adopted Strategy, the Company assumes production of approximately 9.0 m
Slide 24: The use of CAPEX in IH 2017 and plan for 2017 - in line with Strategy
Performance of the plan in Q2, IH 2017 The use of CAPEX in IH 2017 and plan for 2017 - in line with Strategy Realization of plan Realization of plan Item [PLN ‘000] Plan for 2017 IH 2017 IH 2017 [%] New excavations and upgrades of existing 289,659 124,991 43.2% ones Maintenance of machinery 40,243 9
Slide 25: Summary
Summary Q2 2017 saw a drop in international coal prices compared to Q1 2017 (-5%). On the domestic market thermal coal prices increased by almost 2% in comparison to Q1 2017. In Q2 2017 the Company performed the production plan at a level of more than 2.1 million tonnes and sales plan at a level clo
Slide 26: Thank you
Thank you Contact: Lubelski Węgiel Bogdanka SA Bogdanka, 21-013 Puchaczów Tel. +48 81 462 51 00 bogdanka@lw.com.pl Investor relations Tel. +48 81 462 55 44 Tel. +48 81 462 50 29 Fax +48 81 462 54 26 ri@lw.com.pl 26
Slide 27: Agenda
Agenda Situation on the coal market and key operating data Financial highlights of the LW Bogdanka Group in Q2, IH 2017 Performance of the plan in Q2, IH 2017 Appendices – Financial information 27
Slide 28: EBITDA presentation differences between the LW Bogdanka Group and Enea Wydobycie
Appendices – Financial information EBITDA presentation differences between the LW Bogdanka Group and Enea Wydobycie Q2 2017 [PLN milion] 4,3 0,2 138,8 142,9 EBITDA GK LWB dane statutowe Różnica w Difference insposobie ujęcia recognition of amortyzacji depreciation/ Pozostałe korekty prezentacyjne Ot
Slide 29: Changes in provisions at LW Bogdanka Capital Group and their impact on financial result
Appendices – Financial information Changes in provisions at LW Bogdanka Capital Group and their impact on financial result Change Impact on Change Impact on Item [PLN ’000] in provisions financial result in provisions financial result in Q2 2016 in Q2 2016 in Q2 2017 in Q2 2017 Employee provisions 1
Slide 30: Changes in provisions at LW Bogdanka Capital Group and their impact on financial result
Appendices – Financial information Changes in provisions at LW Bogdanka Capital Group and their impact on financial result including: Change Change reflected Item Change reflected in provisions Change reflected in Change reflected only in balance [PLN ’000] Change reflected in only in balance in Q2
Slide 31: Changes in provisions at LW Bogdanka Capital Group and their impact on financial result
Appendices – Financial information Changes in provisions at LW Bogdanka Capital Group and their impact on financial result including: Change Change reflected Item Change reflected in provisions Change reflected in Change reflected only in balance [PLN ’000] Change reflected in only in balance in IH
Slide 32: The Consolidated Income Statement of LW Bogdanka Group
Appendices – Financial information The Consolidated Income Statement of LW Bogdanka Group Item [PLN ’000] Q2 2016 Q2 2017 Change IH 2016 IH 2017 Change Revenue 428,376 436,920 2.0% 848,945 902,086 6.3% Cost of products, merchandise and materials sold, distribution 420,654 379,163 -9.9% 762,607 754,9
Slide 33: Statement of Financial Position of LW Bogdanka Capital Group
Appendices – Financial information Statement of Financial Position of LW Bogdanka Capital Group Item [PLN ’000] 31.12.2016 30.06.2017 Non-current assets, including: 2,929,788 2,886,612 Cash and cash equivalents 111,218 112,197 Current assets, including: 870,501 694,958 Cash and cash equivalents 541,
Slide 34: Cash flow GK LW Bogdanka
Appendices – Financial information Cash flow GK LW Bogdanka Item [PLN ’000] IH 2016 IH 2017 Net cash flows on operating activities 317,885 198,466 Cash inflow from operating activities 324,972 218,204 Interest received 3,556 (272) Income tax paid (10,643) (19,466) Net cash flows on investing activit
Slide 35: Sales structure at LW Bogdanka Capital Group
Appendices – Financial information Sales structure at LW Bogdanka Capital Group Item [PLN ’000] Q2 2016 Share [%] Q2 2017 Share [%] Coal sales 414,632 96.8% 426,165 97.5% Other activities 10,602 2.5% 6,987 1.6% Sales of merchandise and materials 3,142 0.7% 3,768 0.9% Total revenue 428,376 100.0% 436
Slide 36: Disclaimer
Disclaimer This presentation (the “Presentation”) has been prepared by LW Bogdanka S.A. (the “Company”). The information contained in the Presentation has been compiled and prepared with due care, based on facts and data taken from sources believed by the Company to be reliable, in particular based
Slide 37: Thank you for your attention
Thank you for your attention We are part of a modern capital group involved in raw materials and energy operations