New Hope Corporation Limited · ASX:NHC
New Hope — H1 2015 Earnings Presentation
46 slides from New Hope's earnings presentation, Mar 24, 2015
Slide 1: Financial Results Release Half Year Ended 31 January 2015
FINANCIAL RESULTS RELEASE Half Year Ended 31 January 2015 Presented by Shane Stephan, MD 24 March 2015
Slide 2: Disclaimer
DISCLAIMER IMPORTANT: The information in this document has been provided to you for information only by New Hope Corporation Limited (“NHC”) and is subject to change without notice. Nothing contained in this document constitutes investment, legal, tax or other advice. The information in this documen
Slide 3: Overview
OVERVIEW Mr Robert Millner, Chairman
Slide 4: Executive Summary
EXECUTIVE SUMMARY • Ongoing improvement in safety performance • 70% increase in operating cashflows for the period, equating to $26.6 million • Strong sales and production tonnages for the period • Profit after tax before non-regular items totals $34.2 million: – $19.1 million from coal mining, mark
Slide 5: Safety Performance
SAFETY PERFORMANCE Mr Shane Stephan, Managing Director EMERGENCY RESPONSE TEAM TRAINING
Slide 6: Safety Performance HY 2015
SAFETY PERFORMANCE HY 2015 • Significantly improved performance with fewer people being injured • All lag indicators improved for HFY 2015 compared to same period in 2014 – TRI’s down 58% – LTI’s down 43% – HPI’s down 70% • Concentration through i-Safe/We-Safe behavioural program 6 | 24 March 2015
Slide 7: Safety Performance: Quarterly TRIFR
SAFETY PERFORMANCE Quarterly Total Reportable Injury Frequency Rate (TRIFR) 60 50 40 30 20 10 0 TRIFR Linear (TRIFR) 7 | 24 March 2015
Slide 8: Financial Overview
FINANCIAL OVERVIEW NEW HOPE GROUP
Slide 9: Financial Overview
FINANCIAL OVERVIEW HY 2015 6 Months Ended 31 January (A$m) 2015 2014 Change % Revenue from ordinary activities 269.1 284.9 - 5.5% Earnings before interest, tax, depreciation, amortisation 75.7 64.0 + 18.3% and non regular items^ Earnings before interest, tax and non regular items^ 45.6 34.7 + 31.4%
Slide 10: Financial Overview: Earnings per Share and Dividend
FINANCIAL OVERVIEW HY 2015 6 Months Ended 31 January (cents per share) 2015 2014 Earnings per share before non regular items^ 4.1 2.7 Earnings per share (2.8) 2.7 Interim Dividend 4.0 6.0 ^ Refer to Appendix for reconciliation of non-IFRS financial information 10 | 24 March 2015
Slide 11: Group NPAT Comparison Before Non Regular Items
GROUP NPAT COMPARISON Before non regular items 11 | 24 March 2015
Slide 12: Cost Management
COST MANAGEMENT NEW HOPE GROUP
Slide 13: Cost Control
COST CONTROL • Focus on sustainable cost management and productivity initiatives across the total business • Innovate to reduce operating costs e.g. trial of Wirtgen Surface miner at Acland. The trial indicates that this machine will reduce mining costs at improved productivity levels • First half 2
Slide 14: Cost Control
COST CONTROL • Costs of sales reduced by $30.8 million or 22.9% per tonne sold. • Administration costs reduced by $2.2 million or 38.1% per tonne sold • Fuel costs savings of $5.6m, equating to 34.9% per tonne sold 14 | 24 March 2015
Slide 15: Production and Sales
PRODUCTION AND SALES NEW HOPE GROUP
Slide 16: Production & Sales Performance
PRODUCTION & SALES PERFORMANCE HY 2015 Australian Operating Results 7,000 Production Sales 6,000 Tonnes - 000's 5,000 4,000 3,000 2,000 1,000 - 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Years ended 31 July 16 | 24 March 2015
Slide 17: Production & Sales Tonnages
PRODUCTION & SALES TONNAGES HY 2015 6 Months Ended 31 January (million tonnes) 2015 2014 Change ROM Coal Processed 5.537 5.350 + 3.5% Saleable Coal Production 2.871 2.696 + 6.5% Coal Sold * 3.073 3.010 + 2.1% * Includes trade coal 17 | 24 March 2015
Slide 18: Coal Production Volumes
COAL PRODUCTION VOLUMES HY 2015 6 Months Ended 31 January (million tonnes) 2015 2014 Change New Acland 2.544 2.330 + 9.2% Jeebropilly 0.327 0.366 - 10.6% TOTAL 2.871 2.696 + 6.5% 18 | 24 March 2015
Slide 19: Coal Sales Volumes
COAL SALES VOLUMES HY 2015 6 Months Ended 31 January (million tonnes) 2015 2014 Change Export * 3.007 2.930 + 2.6% Domestic 0.066 0.080 - 17.5% TOTAL * 3.073 3.010 + 2.1% * Includes trade coal 19 | 24 March 2015
Slide 20: North Surat Projects
NORTH SURAT PROJECTS NEW HOPE GROUP
Slide 21: North Surat Projects
NORTH SURAT PROJECTS • In Dec 2014 acquired Cockatoo Coal’s 51% of North Surat Joint Venture for $25m • In Feb 2015 acquired Mitsui’s 49% of North Surat Joint Venture on similar terms • Long term strategic investment of a large tonnage of low ash open cut thermal coal 21 | 24 March 2015
Slide 22: North Surat Projects
NORTH SURAT PROJECTS • The three projects acquired from Cockatoo/Mitsui are Taroom, Collingwood and Woori • In combination with New Hope’s existing Elimatta project, the projects contain total resources of over 1 billion tonnes • In the short term, New Hope will focus on project development studies
Slide 23: North Surat Projects Resources and Reserves
NORTH SURAT PROJECTS Resources (Mt) Reserves (Mt) Project Inferred Indicated Measured Total Marketable Probable Proved Total Taroom (1) 126 149.3 158.1 433 161.7 161.7 Collingwood (1) 69 80.3 79.7 229 98.6 98.6 Woori (1) - - 84.3 84.4 40.6 40.6 Elimatta (2) 50 101 108 259 40 100 139 Total 1,005 441
Slide 24: Community and Sustainability
COMMUNITY AND SUSTAINABILITY
Slide 25: Our People: The New Hope Advantage
OUR PEOPLE The New Hope Advantage • We recruit and retain the best people for the job • Experienced Team from Equipment Operators to Senior Management • Ensure a safe and healthy workplace, incorporating well-being initiatives • Provide development and training opportunities • Program underway to al
Slide 26: Community & Social Responsibility
COMMUNITY & SOCIAL RESPONSIBILITY Working together to maintain our Social Licence to Operate • We contribute around $600,000 pa to local community projects and not-for- profit groups through our Sponsorship and Donation Program and Community Investment Fund • New Hope actively partners with, and sup
Slide 27: Community Engagement: New Acland Mine Family Support Walk
COMMUNITY ENGAGEMENT New Acland Mine Family Support Walk • Over eight hundred New Acland employees and supporters turned out in force in Oakey on 15 March to show their support for the coal mine with a Family Support Walk through the town • Employees at the mine came up with the idea for the event t
Slide 28: Revised New Acland Coal Mine Stage Project Highlights
REVISED NEW ACLAND COAL MINE STAGE 3 PROJECT Highlights • Continue the mine until approximately 2029, supporting approximately 435 operational jobs at peak, construction jobs of up to 260, plus thousands of indirect jobs • Potential expansion of the mine to 7.5 Mtpa product • Contribute almost $12 b
Slide 29: Revised New Acland Coal Mine Stage Project Progress
REVISED NEW ACLAND COAL MINE STAGE 3 PROJECT Progress Forecast Timetable: • EIS submitted January 2014 • EIS public comment period ended 3 March 2014 • Additional Information on EIS submitted Q3 2014 • Coordinator-General Report provided Q4 2014 • Environmental Authority Conditions finalised 2015 •
Slide 30: Rehabilitation: Land Management
REHABILITATION Land Management • New Hope is committed to the progressive rehabilitation of land across its operations • Rehabilitation is progressive and occurs right behind the mining activities • To date 402 Ha of land has been fully rehabilitated at Acland • Clear demonstration of the compatibil
Slide 31: Thermal Coal Markets
THERMAL COAL MARKETS NEW HOPE GROUP
Slide 32: Coal Demand: Market Context
COAL DEMAND Market Context Demand China import demand moderating, however high quality Australian Coal is still in demand Indian import demand accelerating – imports rose 28Mt (21%) surpassing Japan as the world’s second largest importer in 2014 India is expected to increase coal fired power g
Slide 33: Coal Supply: Market Context
COAL SUPPLY Market Context Supply Global thermal coal supply growth is moderating Seaborne traded coal however has a strong position in the global coal supply mix due largely to quality and supply certainty Exports of thermal coal will continue to grow from Australia due to new projects previo
Slide 34: Market Outlook
MARKET OUTLOOK • Seaborne thermal coal market supply growth has halted • China is taking action to reduce domestic supply and concurrently reduce imports of other than premium coals • Indonesian exports have plateaued in tonnage and reduced in energy equivalent terms • The future direction of the Au
Slide 35: Oil and Gas
OIL AND GAS NEW HOPE GROUP
Slide 36: Oil and Gas: Bridgeport Energy
OIL AND GAS Bridgeport Energy 6 Months Ended 31 January ($000) 2015 2014 Total Revenue 6,867 6,999 Earnings Before Interest Tax Depreciation (561) 2,479 Amortisation and non regular items Profit Before Tax (after non regular items) (57,741) 1,514 Less Income Tax Benefit (expense) 15,846 (153) Less P
Slide 37: Oil and Gas: Bridgeport Energy Group Production and Revenue
OIL AND GAS Bridgeport Energy Group Production and Revenue 16,000 1,400 34/000 1,200 — 12,000 ~ a 1,000 g 2 10,000 s =] + 800 s 2 8,000 < z | 600 3 +S 6,000 3 E 5 & 4,000 f 400 2,000 + 200 Ang-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-i5 mam Production (bbls) —m-Revenue (A$'000) NEW HOPE GROUP 37 | 24 Marc
Slide 38: Port Operations
PORT OPERATIONS NEW HOPE GROUP
Slide 39: QBH - Port Operations
QBH - PORT OPERATIONS • QBH exported 3.6Mt for the half year • QBH remains essentially a demurrage free port • QBH management and staff maintained the strong safety performance, this year delivering over 2 years Lost Time Injury (LTI) free • Strong focus on cost control through productivity improvem
Slide 40: Outlook
OUTLOOK NEW HOPE GROUP
Slide 41: Strategic Vision: Our Points of Focus
STRATEGIC VISION Our points of focus A commitment to meet or exceed our legal, financial, safety and environmental obligations; and the expectations of our shareholders Retain a high calibre team with the right culture Deliver safe, efficient and cost effective production outcomes Achieve an
Slide 42: Appendix
APPENDIX NEW HOPE GROUP
Slide 43: Reconciliation of Non-IFRS Financial Information
RECONCILIATION OF NON-IFRS FINANCIAL INFORMATION 6 Months Ended 31 January (A$m) 2015 2014 Net profit / (loss) after tax (23.139) 22.663 Income Tax expense / (benefit) 2.449 10.967 Petroleum Resource Rent Tax expense / (benefit) (0.816) 1.020 Profit before income tax (26.404) 34.650 Non regular item
Slide 44: Reconciliation of Net Profit After Tax Before and After Non Regular Items
RECONCILIATION OF NET PROFIT AFTER TAX BEFORE AND AFTER NON REGULAR ITEMS Marketing Treasury 6 Months Ended 31 January Coal Oil and and and Total (A$m) Mining Gas Logistics Investment 2015 Net profit/(loss) after tax 3.524 (41.079) 15.569 (1.153) (23.139) Non regular items after tax Gain on disposal
Slide 45: Reconciliation of Non-IFRS Financial Information
RECONCILIATION OF NON-IFRS FINANCIAL INFORMATION 6 Months Ended 31 January 2015 2014 Basic earnings per share (cents) (before non regular items) 4.1 2.7 Disposal of Dart Energy Limited shares 0.1 - Impairment of oil producing and exploration assets (4.4) - Impairment of goodwill (0.5) - Impairment o
Slide 46: newhopegroup.com.au
newhopegroup.com.au