Peabody Energy Corporation · NYSE:BTU
Peabody Energy — Debt Investor Presentation (November 2020)
32 slides from Peabody Energy's debt investor presentation, Nov 9, 2020
Slide 1: Discussion Materials October 14, 2020
Discussion Materials October 14, 2020 Exhibit 99.1
Slide 2: Legal Disclaimer
Legal Disclaimer Important Information This presentation is strictly confidential and has been prepared by Peabody Energy Corporation (“Peabody” or the “Company”) solely for informational purposes. Recipients of this presentation may not reproduce, disclose or otherwise redistribute, in whole or in
Slide 3: Table of Contents
Table of Contents Executive Summary Situation Overview Overview of the Wilpinjong Drop-Down Business Update & Financial Forecast Proposed Transaction Appendix
Slide 4: I. Executive Summary
I.Executive Summary
Slide 5: Executive Summary
Executive Summary Peabody Energy Corporation (“Peabody” or the “Company”) is seeking to enter into a Transaction Support Agreement (“TSA”) with its Revolving Credit Facility (“RCF”) Lenders, holders of Senior Secured Notes due 2022 (the “2022 Notes”), and sureties that will extend maturity runway, r
Slide 6: II. Situation Overview
II.Situation Overview
Slide 7: Company Overview
Company Overview ($ and tons in millions) Operating performance Revenue ($mm) Adjusted ebitda ($mm) Peabody is a leading global coal miner, with interests in 18 mining operations across the U.S. and Australia Peabody has 4.1 billion tons of proven and probable coal reserves, with thermal and metallu
Slide 8: Portfolio Review
Portfolio Review Asset Map Reserve Summary in million short tons H:\! GRAPHICS\! MAPS\Map Projects\Griffin Over\2020-07-28\Peabody US Assets.ai, Peabody AUS Assets.ai 1 1 Peabody’s share of production and reserves, and coal quality metrics are presented on a consolidated basis for Wambo Open-Cut and
Slide 9: Capitalization Table
Capitalization Table ($ in millions) Peabody was levered at ~2.2x Net Debt / LTM Adj. EBITDA (on a book basis) and had ~$860 million of liquidity at the end of Q3’20 During Q3’20, the Company posted $53.2 million in additional letters of credit and a AU$50 million bank guarantee to sureties and othe
Slide 10: Situation Overview and Q2'20 Update
Situation Overview and Q2’20 Update Peabody’s second quarter 2020 was marked by challenging seaborne and domestic market conditions that materially weighed on results and exacerbated issues of declining liquidity, increasing leverage, and refinancing risk with stressed securities prices Peabody repo
Slide 11: Summary of Near-Term Challenges
Summary of Near-Term Challenges The global economic disruption from the COVID-19 pandemic has increased Peabody’s near-term financial challenges, including (i) tightening financial maintenance covenant headroom, (ii) the maturity of $459 million principal amount of Notes in 2022, and (iii) decreasin
Slide 12: III. Overview of the Wilpinjong Drop-Down
III.Overview of the Wilpinjong Drop-Down
Slide 13: "New" Corporate Structure
“New” Corporate Structure On August 4, 2020, using baskets in the Credit Agreement and Indentures, Peabody designated the Wilpinjong mine and its related legal entities as unrestricted subsidiaries to enhance the Company’s financial flexibility and create a path for a potential debt-for-debt exchang
Slide 14: Overview of Wilpinjong
Overview of Wilpinjong ($ in millions) Mine Overview Wilpinjong is a leading thermal coal surface mine with historical and projected stable cash flows and low-cost operations, located in New South Wales, Australia Highly-efficient dozer/casting and truck and shovel operation among the largest coal m
Slide 15: Australian Thermal Coal Cost Curve
Australian Thermal Coal Cost Curve Wilpinjong is a premier seaborne thermal coal mine (with significant domestic sales) currently positioned in the 1st decile of the Australian thermal coal cost curve Australian Thermal Coal Cost Curve — Total Cash (USD/st, includes transportation costs) Wilpinjong
Slide 16: Wilpinjong — Mining Equipment
Wilpinjong — Mining Equipment Type Description Count Major HME CAT 6060 Excavator 1 Liebherr 9400 Excavator 1 Liebherr 9350 Excavator 4 CAT994H Loaders 2 MT4400 Haul Trucks 6 CAT793 Haul Trucks 5 CAT789 Haul Trucks 19 CAT-D11 Dozers (Prim Dozer Push) 12 Atlas Copco (D65) Hammer Drill 2 Atlas Copco R
Slide 17: Wilpinjong — Financial Summary
Wilpinjong — Financial Summary ($ in millions) The tables below summarize Wilpinjong’s pro forma financials over the last four fiscal quarters Financials adjusted pro forma for the management services agreement with Peabody and related costs Pro Forma & Other Adjustments include realized exchange ra
Slide 18: IV. Business Update & Financial Forecast
IV.Business Update & Financial Forecast
Slide 19: Global Customer Base
Global Customer Base Note: The Company attributes revenue to individual regions based on the location of the physical delivery of the coal. Revenue breakdown for FY’19. Peabody serves a broad global customer base and generates nearly half of its revenue from outside of the U.S.
Slide 20: Supply and Demand Dynamics — COVID-19 Impact
Supply and Demand Dynamics — COVID-19 Impact China net importer of steel for first time in 11 years in June; Heightened import restriction risk weighing on market Slower economic activity in India suppresses coal demand, total coal imports down ~30Mt August YTD Indonesia thermal coal exports down 27
Slide 21: Key Operating Initiatives
Key Operating Initiatives The global market uncertainty requires Peabody to further improve its operating performance, ensuring it has a scalable cost structure. Key initiatives include: Progressing cost repositioning program to counter impacts of reduced demand / low pricing Reduced ~25% of workfor
Slide 22: ESG Approach
ESG Approach Commitment to environmental, social and governance (“ESG”) practices underpins activities and shapes long-term strategy, with an ESG approach centered on: Minimizing the environmental footprint of our operations Begin with a deep appreciation and understanding for land and communities w
Slide 23: Financial Forecast — RemainCo
Financial Forecast — RemainCo (Tons and $ in millions) Note:Q3’20 financials include Wilpinjong’s results prior to its designation as an unrestricted subsidiary (July 2020). 2020 PRB pricing and 2020–2024 Midwest pricing reflect weighted-average pricing across all mines/products in the PRB and Midwe
Slide 24: Financial Forecast — U-Sub
Financial Forecast — U-Sub ($ in millions) Wilpinjong is projected to generate positive free cash flow through FY’24 and has the ability to support structurally senior debt issued at the unrestricted subsidiary level in an exchange for existing Peabody debt Q3’20E projections reflect preliminary res
Slide 25: V. Proposed Transaction
V.Proposed Transaction
Slide 26: Pro Forma Corporate Structure
Pro Forma Corporate Structure Peabody Energy Corporation Peabody Investments Corp. Peabody Investments (Gibraltar) Limited Peabody Energy (Gibraltar) Limited Peabody Australia Holdco Pty Ltd Peabody International (Gibraltar) Limited Peabody Holland B.V. Peabody Energy Australia Pty Ltd Peabody Energ
Slide 27: Sources & Uses and Pro Forma Capitalization
Sources & Uses and Pro Forma Capitalization Selected Commentary Participating RCF Lenders exchange the current $540 million1 of RCF commitments for $175 million of New Structurally Senior Term Loans and $319 million of RCF commitments with an extended 2025 maturity $459 million of 2022 Notes exchang
Slide 28: Projected Pro Forma Financials
Projected Pro Forma Financials ($ in millions) RemainCo EBITDA includes management fees and tax sharing payments from Wilpinjong. Wilpinjong EBITDA is net of management fees and “Other” cash flows includes tax sharing payments to RemainCo. Assumes the ARS and RCF facilities are paid down to provide
Slide 29: VI. Appendix
VI.Appendix
Slide 30: Reconciliation of Non-GAAP Financial Measures (Unaudited)
Reconciliation of Non-GAAP Financial Measures (Unaudited)
Slide 31: Reconciliation of Non-GAAP Financial Measures (Unaudited) (cont'd)
Reconciliation of Non-GAAP Financial Measures (Unaudited) (cont’d)
Slide 32: Reconciliation of Non-GAAP Financial Measures (Unaudited) (cont'd)
Reconciliation of Non-GAAP Financial Measures (Unaudited) (cont’d)
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