Whitehaven Coal Limited · ASX:WHC
Whitehaven Coal — BMO Capital Markets 26th Global Metals and Mining Conference 2017
30 slides from Whitehaven Coal's conference presentation, February 2017
Slide 1: Whitehaven Coal Limited
Whitehaven Coal Limited Australia’s Leading High Quality Coal Company BMO CAPITAL MARKETS 26TH GLOBAL METALS AND MINING CONFERENCE MIAMI, UNITED STATES 26 FEBRUARY – 1 MARCH 2017
Slide 2: Disclosure
Disclosure STATEMENTS CONTAINED IN THIS MATERIAL, PARTICULARLY THOSE REGARDING THE POSSIBLE OR ASSUMED FUTURE PERFORMANCE, COSTS, DIVIDENDS, RETURNS, PRODUCTION LEVELS OR RATES, PRICES, RESERVES, POTENTIAL GROWTH OF WHITEHAVEN COAL LIMITED, INDUSTRY GROWTH OR OTHER TREND PROJECTIONS AND ANY ESTIMATE
Slide 3: Agenda
Agenda – Who We Are – Operational Performance – Financial Performance – Outlook for Coal Use – Outlook for Whitehaven – Appendices 3 // BMO GLOBAL METALS AND MINING CONFERENCE 2017
Slide 4: Who We Are
Who We Are AUSTRALIA’S LARGEST INDEPENDENT COAL MINER (ASX CODE: WHC) PRODUCING PREMIUM COALS FOR THE ASIAN SEABORNE MARKET − Lowest cost quartile coal miner − Producer of premium quality thermal and metallurgical coals − Long life, low cost tier one mines with world class reserves − Profitable at c
Slide 5: Whitehaven Snapshot
Whitehaven Snapshot PRODUCER OF HIGH QUALITY COAL SOLD TO PREMIUM ASIAN SEABORNE MARKET ASX Code: WHC Costs – 1,026 million shares on issue with 7,000 – Unit costs reduced to A$56/t in H1 FY17, in the shareholders lowest cost quartile – Market Cap A$2.9 billion (US$2.2B) – Trading over 175 million s
Slide 6: Where We Mine
Where We Mine Maules Creek (75%) Tier One Mine – Reserves ~ 40 years, Permitted & Planned 13Mtpa – SSCC, PCI and high energy thermal Narrabri (70%) Tier One Mine – Reserves ~ 25 years, Permitted 11Mtpa, Planned >8Mtpa – PCI & low ash thermal Werris Creek (100%) – Reserves ~ 8 years, Permitted 2.5Mtp
Slide 7: Where We Sell Our Coal
Where We Sell Our Coal SALES GROWING IN NEW ASIA MARKETS Thermal Coal Sales H1 FY2017 Managed Coal Sales by Type 100% 5% 2% 4% Japan 80% Taiwan 9% Korea 60% Other Asia 20% 16% 16% 7% Malaysia 40% 10% Americas 53% 61% 68% 20% 63% Other 27% 22% 16% 0% FY2015 FY2016 H1 FY2017 Metallurgical Coal Sales H
Slide 8: Operational Performance
Operational Performance
Slide 9: Safety Performance
Safety Performance SAFETY PROGRAMMES ARE DELIVERING IMPROVED OUTCOMES – Whitehaven recorded its lowest TRIFR Whitehaven Coal Group - TRIFR (12 Month Rolling Average Recordable Injuries per million hours worked) of 7.2 at the end of December 30 – The ongoing focus on Whitehaven’s 25 “Safehaven Rules”
Slide 10: Production Profile
Production Profile MINE PRODUCTION CONTINUING TO GROW Whitehaven Saleable Coal Production (100%, Mt) – Production has quadrupled in five years 25.0 – Production guidance for FY2017 recently confirmed in the range of 21Mt to 22Mt 20.0 – Stable production from the smaller open cuts supported by strong
Slide 11: Maules Creek Growth and Product Mix
Maules Creek Growth and Product Mix SALES OF METALLURGICAL COAL INCREASING FASTER THAN EXPECTED Maules Creek Saleable Product Mix (Mt) – High margin metallurgical coal production (SSCC) 10.0 is forecast to reach 32% of the total from the mine in FY2017 8.0 – With thermal coal sales running at an ann
Slide 12: Narrabri
Narrabri CONSISTENT PRODUCTION BETWEEN 7MTPA AND 8MTPA Narrabri ROM Coal Production (Mt) – Production guidance for FY2017 in the range of 9.0 7.5Mt and 7.8Mt ROM coal 8.0 – The face widening project is on schedule with the 7.0 first 400 metre wide panel due to commence 6.0 production in April 2017 5
Slide 13: Indicative Timetable for Vickery
Indicative Timetable for Vickery INCREASES WHITEHAVEN’S MANAGED PRODUCTION TO OVER 30MTPA WHEN FULLY RAMPED June 2017 EIS lodged for the commencement of the approval process CY2018 Formation of JV H1 CY2019 Project approved by all the relevant Government authorities H1 CY2019 Board makes final inves
Slide 14: Financial Performance
Financial Performance
Slide 15: Financial Highlights
Financial Highlights CAPTURING THE BENEFITS OF HIGHER COAL PRICES H1 H1 Profit and loss Comment FY2017 FY2016 Net profit after tax ($’m) 157.5 7.8 – 19% NPAT margin EBITDA ($’m) 324.8 106.4 – Up 205% on pcp Cash generated from operations ($’m) 263.6 118.3 – Up 123% on pcp Unit cost per tonne 56 58 –
Slide 16: Costs and Margins
Costs and Margins HIGHER COAL PRICES FLOWING THROUGH TO MARGINS AND CASH FLOW Whitehaven's ASP and Costs ($/t) – Costs of A$56/t excluding NSW 100 Government royalties were in line with guidance for the year – The sharp increase in the margin was 80 due to a combination of higher coal prices and the
Slide 17: Outlook for Coal Use
Outlook for Coal Use
Slide 18: IEA Medium Term Forecasts
IEA Medium Term Forecasts COAL DEMAND CONTINUES GROWING Global Thermal Coal Demand (Mtce) – Global coal demand is forecast to grow through 5000 to 2021 based on recent IEA forecasts 4800 – Coal demand in Asian nations (excluding 4600 China) continues to be strong with an additional 4400 244Mtce (283
Slide 19: Coal Fired Plant Efficiency Improving
Coal Fired Plant Efficiency Improving DEPLOYMENT OF HELE TECHNOLOGY IMPROVES EFFICIENCY OF THE FLEET Average Coal Fired Plant Efficiency (%) – Deployment of HELE plants in Japan and 42.0 Germany is reflected in the high average efficiency of the plants Japan 40.0 – Deployment of HELE plants in China
Slide 20: Coal - Pathway to Lower Carbon Emissions
Coal - Pathway to Lower Carbon Emissions UTILISING HIGH QUALITY COALS IN MORE EFFICIENT HELE POWER STATIONS LOWERS EMISSIONS Emissions by Technology (tCO2/MWh) – Converted from lignite and black coal fired 1.6 subcritical power stations to black coal fired USC plants reduces CO2 emissions 1.4 signif
Slide 21: Examples from Australia and China
Examples from Australia and China THE TALE OF TWO POWER STATIONS – Waigaoqiao No3 power station in China began operating in 2008 utilising USC boiler technology • Two 1000MW units producing 2000MW operating at 46.5% efficiency producing 11.7Mtpa CO2, employing 265 people – Yallourn power station in
Slide 22: Outlook for Whitehaven
Outlook for Whitehaven
Slide 23: Thermal Coal Market
Thermal Coal Market SEABORNE MARKET REBALANCED IN 2016 AND CONTINUES TO GROW STRONGLY Thermal Coal Demand Growth in Whitehaven's – Global production cuts rebalanced the Key Markets (Mt) thermal coal market during 2016 600 – The combination of production cuts and 500 growing demand for higher quality
Slide 24: Whitehaven’s Production Growth
Whitehaven’s Production Growth MAULES CREEK RAMP UP AND WIDER FACE AT NARRABRI CONTRIBUTING TO GROWTH Saleable Coal Production (100%, Mt) – Ramping up of production from 25.00 Maules Creek continues and the wider face at Narrabri contributes 20.00 from H2 FY2017 – Increased production higher quality
Slide 25: Embedded Growth Opportunities
Embedded Growth Opportunities WHITEHAVEN HAS MANY OPTIONS TO GROW SHAREHOLDER VALUE – Increase the approval limit at Maules Creek from 13Mtpa ROM to 15+Mtpa ROM – Extend the longwall panels into the south area at Narrabri, increasing LOM and annual production – Seek opportunities to increase the foo
Slide 26: Targets for 2017
Targets for 2017 FOCUSSED ON GROWING PRODUCTION SAFELY AND DEBT REDUCTION Operations − Continue improving safety performance − Deliver saleable coal production guidance in the range of 21Mt to 22Mt (100% basis) − Deliver the face widening project at Narrabri and commence mining in the initial 400m w
Slide 27: Whitehaven Coal
www.whitehavencoal.com.au >» WHITEHAVEN COAL WHITEHAVEN
Slide 28: Appendices
Appendices
Slide 29: Resources
Resources Note: See Competent Person Statement on Slide 2 29 // BMO GLOBAL METALS AND MINING CONFERENCE 2017
Slide 30: Reserves
Reserves Note: See Competent Person Statement on Slide 2 30 // BMO GLOBAL METALS AND MINING CONFERENCE 2017
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