Whitehaven Coal Limited · ASX:WHC
Whitehaven Coal — H1 FY2012 Earnings Presentation
35 slides from Whitehaven Coal's earnings presentation, Feb 16, 2012
Slide 1: ASX cover announcement for amended results presentation
For personal use only 16th February 2012 The Manager, Listings Australia Securities Exchange Company Announcement Office Half Year FY2012 Results Presentation (amended to correct formatting issues) Attached is a revised version of the Whitehaven Half Year FY2012 Results Presentation which was releas
Slide 2: Delivering Growth – Half Year FY2012 Results
Whitehaven Coal Limited For personal use only Delivering Growth Half Year FY 2012 Results Sydney, Australia 16 February 2012
Slide 3: Disclaimer
Disclaimer For personal use only 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 projec
Slide 4: Qualifications and Statement
Qualifications and Statement For personal use only Information in this report that relates to Coal Resources and Reserves is based on and accurately reflects reports prepared by the Competent Person named beside the respective information. All these persons are consultants for Whitehaven Coal Limite
Slide 5: First half financial highlights – FY 2012
First half financial highlights – FY 2012 For personal use only ► Net profit after tax (NPAT) of $19.9 million1 ► Underlying NPAT (excluding Significant Items) of $22.0 million, down from $32.9 million in the first half of FY 2011, due mainly to delivery of much higher tonnages of Legacy contracts i
Slide 6: First half operating highlights – FY 2012
First half operating highlights – FY 2012 For personal use only ► Total coal sales down, with more coal purchased to meet legacy contracts ► down 4% to 3.289 million tonnes (Mt) (100% basis) ► down 4% to 2.997 Mt (equity share) ► Saleable coal production increased ► up 13% to 2.464 Mt (100% basis) ►
Slide 7: First half business development highlights - FY 2012
First half business development highlights - FY 2012 For personal use only ► Increases in JORC Coal Resources and Reserves were reported in August ► Received approval from the NSW Minister for Planning for ~20 year life-of-mine operations at Werris Creek, up to 2.5 Mtpa ► Lodged Environmental Assess
Slide 8: First half cash cost up 3.6%, but EBITDA higher
First half cash cost up 3.6%, but EBITDA higher For personal use only A$/t FOB H1 - FY 2011 H1 - FY 2012 Coal Sales - 000t (equity basis, excl. purchased coal) 1,948 2,166 Average revenue - (excl. purchased coal & net of NSW royalties) 98.73 104.06 Average cash cost of sales 61.81 64.04 EBITDA per s
Slide 9: First half profitability – FY 2012
First half profitability – FY 2012 For personal use only Reported Financial Performance - A$ millions H1 - FY 2011 H1 - FY 2012 Revenue 318.3 340.4 NPAT before Significant Items 32.9 22.0 NPAT (35.1) 19.9 Earnings per share (cents per share - diluted) (7.1) 4.0 Interim dividend (cents per share - fu
Slide 10: First half cash flow – FY 2012
First half cash flow – FY 2012 For personal use only A$ millions H1 - FY 2011 H1 - FY 2012 EBITDA from own coal sales 72.0 86.7 Cash impact of coal trading (35.4) (28.8) Movement in working capital1 (19.9) (90.2) Cash generated from operations 16.7 (32.3) Interest and tax payments (34.2) (21.6) Net
Slide 11: December financial position
31 December financial position For personal use only A$ millions June 30 - 2011 December 31 – 2011 Cash 207.6 103.5 Current receivables 92.4 61.8 Other current assets 162.3 166.1 Current assets 462.3 331.4 Non-current receivables 2.7 6.4 Other non-current assets 997.4 1,089.0 Total assets 1,462.4 1,
Slide 12: First half capex – FY 2012
First half capex – FY 2012 For personal use only Capital Investment - $ million H1 – FY 2011 H1 – FY 2012 Tarrawonga 1 0.8 2.3 Werris Creek 5.2 6.6 Rocglen 1.1 0.3 Sunnyside 0.7 0.3 Gunnedah CHPP 12.6 1.6 Total Open-cuts 1 20.4 11.1 Narrabri 1, 2 54.4 38.4 New coal train 3.7 0.2 Exploration 1.5 3.1
Slide 13: Fixed price coal contracts and fixed FX status
Fixed price coal contracts and fixed FX status For personal use only ► “Legacy” thermal coal contracts of 329 thousand tonnes (Kt) remain to be delivered in the March 2012 quarter at an average price of US$66.15/t. Otherwise, US$ coal prices are only fixed for the short term ► Whitehaven has a total
Slide 14: Substantial growth from Narrabri imminent
Substantial growth from Narrabri imminent For personal use only ► Coal resources of 854 Mt in a single seam of 8-9 metres thick ► Current marketable reserves of 199.9 Mt based on extracting the bottom 4.2 metre section of the seam only ► Low ash, high energy, low sulphur PCI and thermal coals for th
Slide 15: Longwall installation starts in early March
Longwall installation starts in early March For personal use only ► CM production started in June 2010 ► Four continuous miners developing main roads and LW1 ► More than 400 Kt of saleable coal produced to date ► Longwall to be dis- assembled and taken underground in March ► First longwall coal expe
Slide 16: Underground development as at end January
Underground development as at end January For personal use only No.1 SHAFT 9 ct 14
Slide 17: Gas drainage system performing very well
For personal use only Narrabri Mine Gas Drained (m3) 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 0 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Monthly Gas Production from SIS Apr-11
Slide 18: Building an inventory of drained coal
Building an inventory of drained coal For personal use only SIS on Drainage SIS Drilled Planned SIS Completed UIS 16
Slide 19: Extension of the Tarrawonga JV has significant strategic benefits
Extension of the Tarrawonga JV has significant strategic benefits for both parties For personal use only ► Utilises coal reserves within the Boggabri Coal area which would not otherwise be mined ► Extends the existing 70:30 Tarrawonga JV reserves to allow up to 3 Mtpa for 20 years with same coal qua
Slide 20: Vickery a major strategic acquisition
Vickery a major strategic acquisition For personal use only ► 439 Mt of open cut Coal Resource, with an interim Marketable Reserve of 113.5 Mt ► Coal seams at Vickery contain a range of semi- soft coking and high quality thermal coals ► Previous coal quality analysis indicates a ~80% yield of mainly
Slide 21: Large OC reserve at Vickery with extensions to come
Large OC reserve at Vickery with extensions to come For personal use only ► 439 Mt opencut Coal Resource in the Vickery area ► Main Pit (green outline) now has 164 Mt of ROM coal at MERTON 10:1 stripping ratio, of which POTENTIAL 129 Mt is currently JORC EXTENSION Recoverable Reserve AREA ► Further
Slide 22: Rail capacity to meet Whitehaven's growth
Rail capacity to meet Whitehaven’s growth For personal use only ► Whitehaven has a long term track access agreement with ARTC which provides capacity to meet Whitehaven's planned growth ► Further track upgrades have been identified by ARTC to increase rail capacity to ~60 Mtpa from the Gunnedah Basi
Slide 23: Port capacity to meet Whitehaven growth
Port capacity to meet Whitehaven growth For personal use only WHC - PORT CAPACITY BUILDUP 16,000 14,000 12,000 New PWCS (T4) Third Party Contracts Thousand tonnes 10,000 Tarrawonga JV NCIG Stage 2F NCIG Stage 2AA 8,000 NCIG Stage 1 PWCS Contract 6,000 4,000 2,000 0 21 FY 2012 Half Year Results - Feb
Slide 24: Whitehaven is the leading coal producer and developer in the Gunnedah Basin
Whitehaven is the leading coal producer and developer in the Gunnedah Basin For personal use only 1 Large resources and reserves of high quality coal 2 High productivity mines & high yield coals provide cost and margin benefits Increasing percentage of metallurgical coal production and close to 100%
Slide 25: Low-risk open cut production base with substantial growth
Low-risk open cut production base with substantial growth from Narrabri UG and Vickery OC For personal use only ► Four OC mines with ~5.5 Mtpa1 SALEABLE PRODUCTION CAPACITY VS PORT capacity. OC growth from CAPACITY (100% BASIS) 1. 18,000 Vickery ► Saleable production capacity 16,000 expected to be ~
Slide 26: Merger with Aston - transaction overview
Merger with Aston - transaction overview For personal use only Whitehaven / Aston merger All-scrip merger of equals between Whitehaven and Aston Aston shareholders to receive 1.89 Whitehaven shares per Aston share Fully-franked special dividend of A$0.50 per Whitehaven share to existing Whiteh
Slide 27: Creates a leading independent coal company
Creates a leading independent coal company For personal use only Large scale, diversified coal producer 1 I. Leading ASX listed coal company with substantial reserve and resource base II. Solid production and profit base from five high quality, low cost producing mines Substantial growth pipeline 2
Slide 28: Overview of combined portfolio
Overview of combined portfolio For personal use only Narrabri (70%) GUNNEDAH BASIN TENEMENT HOLDINGS Sienna (100%) n Status: Producing To Narrabri (20km) n Status: Exploration Ka n Resources: 855Mt mil lar oi n Reserves: 220Mt Narrabri Mine Maules Creek Hig hw ay Dingo (70%)3 Boggabri Mine Baan Baa
Slide 29: Large-scale, diversified coal producer
Large-scale, diversified coal producer For personal use only Saleable production (Mt, 100% basis) Substantial production Includes only Whitehaven and Aston assets; excludes Boardwalk assets. 25 growth driven by: 22 Narrabri – expected to commence longwall production in April 2012 16 Maules Creek
Slide 30: Substantial growth pipeline
Substantial growth pipeline For personal use only Merged Entity is very well Exploration Pre-Feasibility Feasibility Approvals Construction Producing positioned to deliver its growth Study Study Assets plans Stable, low risk cashflows from existing open cut Merton Maules Creek Narrabri operation
Slide 31: Strategic port and rail infrastructure position
Strategic port and rail infrastructure position For personal use only Port capacity and export coal sales (Mt, 100% basis) Port capacity to meet future production with Includes only Whitehaven and Aston assets; excludes Boardwalk assets. extensive agreements in place PWCS (existing) Longer term ca
Slide 32: Significant synergies to be unlocked from merger
Significant synergies to be unlocked from merger For personal use only Ability to optimise production by leveraging larger infrastructure base Prioritise output of higher margin coals, particularly during periods of port and / or rail Port and rail infrastructure constraints sharing Stronger negotia
Slide 33: Highly regarded Board and management
Highly regarded Board and management with an established record of enhancing shareholder value For personal use only Board The Hon. Mark Vaile Mr John Conde AO Mr Tony Haggarty Mr Rick Gazzard Mr Philip Christensen Independent Independent Deputy Managing Director Independent Non- Non-Executive Chair
Slide 34: Path to delivering growth and value
Path to delivering growth and value For personal use only 1 Realise synergies from merger 2 Deliver on near term development pipeline: Maules Creek and Vickery 3 Achieve 25 Mtpa by FY2016 4 Maximise value from Boardwalk exploration portfolio 5 Platform for further consolidation in the Australian coa
Slide 35: Indicative transaction timetable
Indicative transaction timetable For personal use only 12 December 2011 Announcement of merger and Boardwalk acquisition Early March 2012 Scheme booklet despatched to Aston shareholders Early March 2012 Notice of Meeting despatched to Whitehaven shareholders Early April 2012 Aston Scheme meeting Whi