Peabody Energy Corporation · NYSE:BTU
Peabody Energy — Dahlman Rose Global Metals, Mining & Materials Conference 2010
28 slides from Peabody Energy's conference presentation, Nov 17, 2010
Slide 1: Dahlman Rose Global Metals, Mining & Materials Conference
1 1 Dahlman Rose Global Metals, Mining & Materials Conference November 17, 2010 Christina Morrow Vice President Investor Relations Exhibit 99.1
Slide 2: Statement on Forward-Looking Information
2 Statement on Forward-Looking Information Some of the following information contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, and is intended to come within the safe-harbor protecti
Slide 3: Peabody Energy: Catalysts for Growth
3 Peabody Energy: Catalysts for Growth U.S. Largest producer in lowest cost, highest growth regions Expanding margins via strong contracting, stable costs Extending PRB reach into Eastern U.S. and Asia Australia Expanding platform via organic growth Asia Advancing projects in China, Mongolia, India
Slide 4: Strong Results, Outstanding Outlook
4 2006 2007 2008 2009 2010 EBITDA 909.7 969.7 1846.9 1290.1 1850 50 Year-to-date September 2010 results: Australia EBITDA doubles to $670 million U.S. EBITDA grows 14% to $854 million Operating cash flows reach record $884 million Adjusted diluted EPS increases 48% Substantial liquidity to fund grow
Slide 5: Peabody's Margins Outperform U.S. Peers
5 Peabody's Margins Outperform U.S. Peers Source: Gross margin data obtained from publicly filed documents for the period ending Sept. 30, 2010. Australian exports levered to rising international demand and pricing Cost management and productivity enhancements drive continued margin expansion YTD Gr
Slide 6: Early Stages of Coal's Supercycle
Early Stages of Coal's Supercycle
Slide 7: Major New Global Build Out of Coal Generation Under Way
7 Major New Global Build Out of Coal Generation Under Way Source: Platts Worldwide Power Plant Database; EIA International Energy Outlook 2010 and Peabody analysis. Growth of global coal-based generation (billion kilowatt hours) based on 2007 - 2035 EIA data. Generation Demand Driven by Asia and Gro
Slide 8: Global Met Coal Use Forecast to Rise
8 8 Global Met Coal Use Forecast to Rise 400 Million Tonnes by 2015 Expected Global Steel Production And Met Coal Demand Source: World Steel Association; third party data and Peabody analysis. Global steel production expected to rise nearly two-thirds by 2020 Bulk of market share growth in China and
Slide 9: China and India Lead Long-Term Coal Demand Growth
9 9 U.S. growth presented in short tons. Source: World Energy Outlook 2009, International Energy Agency; Annual Energy Outlook Forecasts, Energy Information Administration; Peabody analysis. China and India Lead Long-Term Coal Demand Growth +690 +2,210 +150 +50 +110 +380 Developing Asia Represents 9
Slide 10: Near- and Mid-Term Pacific Markets Outstanding for Coal
Near- and Mid-Term Pacific Markets Outstanding for Coal
Slide 11: Seaborne Thermal Coal Market Short Next Five Years
11 11 Seaborne Thermal Coal Market Short Next Five Years; Implies Strong Pricing Driver 2010 2011 2012 2013 2014 2015 Atlantic 0 6 19 29 35 37 Other Pacific 0 5 17 30 50 60 China 0 2 4 6 8 13 India 0 20 40 60 80 90 Expected Increase in Seaborne Thermal Demand 2010 - 2015 India 125%-175% China 5%-25%
Slide 12: Seaborne Met Coal Market Fundamentally Short
12 12 2015 Australia 37 Mongolia 14 Other Pacific 15 Russia 5 Seaborne Met Coal Market Fundamentally Short 2015 Brazil 20 India 14 China 15 Europe 4 South Korea 6 Japan 4 Other 2 Expected Increase in Seaborne Met Demand 2010 - 2015 Expected Increase in Seaborne Met Supply 2010 - 2015 30-40 ~10 ~10 0
Slide 13: China Dependent on Imports to Balance Supply / Demand
13 China Dependent on Imports to Balance Supply / Demand Shortfall Driving Net Imports Reliance Dramatic, sustained demand growth Consolidation, rising domestic costs Lack of premier coking coal Supply growth distant from load Growing coastal steel mills and power plants ~600 MTPA of coastal coal mo
Slide 14: Ongoing Reliance on Coal Imports by China
14 2003 2004 2005 2006 2007 2008 2009 2010 Est. 2011 Est. Imports -83.124 -67.963 -45.548 -24.988 -2.087 -4.449 69.6 107.7 115 34.6 29.8 0 Data based on industry reports; 2010 reflects Jan. - Sept. annualized and Oct. - Dec. Peabody estimate. China Net Coal Imports 135 - 140 The Result: Ongoing Reli
Slide 15: India Likely to be World's Fastest Growing Coal Importer
15 2009 2010 2011 2012 2013 2014 2015 Met 28 36 38 43 45 47 52 Met Thermal Range 5 8 12 18 20 25 Thermal 50 68 88 100 120 140 150 Forecast Thermal Range 15 20 25 30 45 50 India Likely to be World's Fastest Growing Coal Importer Data and estimates based on industry reports and Peabody analysis. Units
Slide 16: Expanding Australia Platform: Targeting Sales Up to 40 MTPA by 2014
16 2009 2010 2014-15 Seaborne Thermal 9.6 11.5 15 0.5 2 Expanding Australia Platform: Targeting Sales Up to 40 MTPA by 2014 Tons in Millions 2009 2010 2014-15 Seaborne Met 7 9.5 12 1 3 11.5 - 12.5 15.0 - 17.0 9.6 9.5 - 10.0 12.0 - 15.0 6.9 Met Coal Sales Estimates Seaborne Thermal Coal Sales Estimat
Slide 17: Significant Progress in Peabody's Australia Project Pipeline
Significant Progress in Peabody's Australia Project Pipeline Met Seaborne Thermal Metropolitan 1 MT HCC, $70 million Burton 2 - 3 MT HCC Millennium 2 - 3 MT SHCC/PCI Denham/Goonyella Corridor 5 - 6 MT HQHCC Wilpinjong 2 - 3 MT, $90 million Wambo 3 - 4 MT Thermal/PCI 17 Short tons in millions. Dollar
Slide 18: Leading Trading Operations Add Significant Value
18 Leading Trading Operations Add Significant Value Growing, profitable global trading and brokerage operations Continued expansion with new offices Best use of financial products and physical asset base Pipeline of market intelligence 2003 2004 2005 2006 2007 2008 2009 Domestic EBITDA 45.828 34.781
Slide 19: Peabody Advancing Robust China Project Pipeline
19 20 MTPA Open-Cut JV Project 15 MTPA Open-Cut JV Project 12 MTPA Open-Cut JV Fueling Coal-to- Chemicals Project 15 MTPA Open- Cut JV Fueling Clean Coal Project Beijing Tianjin Shanghai Xinjiang Inner Mongolia Guangdong Hong Kong Fujian Zhejiang 15 MTPA Open-Cut JV Project Long-term Initiative Mid-
Slide 20: Peabody Positioning to Serve Fastest Growing Import Nation
20 Peabody Positioning to Serve Fastest Growing Import Nation Peabody Positioning Met coal from Australia operations Thermal coal via COALTRADE Exploring long-term coal supplies and other strategic ventures with Coal India Source: Platts. Major Coastal Plant Build Out to Access Import Coal
Slide 21: Peabody Best Positioned in Fastest Growing U.S. Regions
Peabody Best Positioned in Fastest Growing U.S. Regions
Slide 22: U.S. Coal Demand On Pace for Recovery in 2010
22 U.S. Coal Demand On Pace for 60 - 80 Million Ton Recovery in 2010 Source: Energy Information Administration; MSHA; National Mining Association and other third-party sources. 2009 vs. 2010 Expected Demand 2009 2010 East 1062 1062 Electric Generation 31 Gas Back to Coal 10 U.S. Exports 20 Other 10
Slide 23: U.S. Contracting Strategy Matches Shape of Economic Recovery
23 U.S. Contracting Strategy Matches Shape of Economic Recovery U.S. Contracting Strategy Guarded approach near term ~90% priced for 2011 Significant leverage to market upside long term 2012: 35% to 45% available to price 2013: ~85% available to price
Slide 24: SPRB and Illinois Basin: Majority of U.S. Coal Demand Growth
24 SPRB and Illinois Basin: Majority of U.S. Coal Demand Growth PRB Advantage Low end of cost curve Primary source for new plants Asian export potential Illinois Basin Advantage Lower cost than Appalachia Major source for new plants CAPP to Experience Significant Decline Constraints driven by safety
Slide 25: Peabody's Catalysts for Growth & Shareholder Value Upside
Peabody's Catalysts for Growth & Shareholder Value Upside
Slide 26: Peabody Energy: Catalysts for Growth
26 26 Peabody Energy: Catalysts for Growth Bear Run Mine Expanding Production Multiple PRB Export Opportunities in Development Expanding Australia Seaborne Met, Thermal Volumes Metropolitan, Wilpinjong and Burton Construction Commenced Multiple JVs and Large Project Pipeline in China Pursuing Mongol
Slide 27: Peabody Energy: The Only Global Pure-Play Coal Investment
27 Peabody Energy: The Only Global Pure-Play Coal Investment Coal long-term supercycle is in the early stages BTU: Unique assets, market position and prospects Best access to fastest growing global markets #1 in lowest cost and fastest growing U.S. regions Significant catalysts for growth and increa
Slide 28: Dahlman Rose Global Metals, Mining & Materials Conference
28 28 Dahlman Rose Global Metals, Mining & Materials Conference November 17, 2010 Christina Morrow Vice President Investor Relations
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