Hallador Energy Company · NASDAQ:HNRG
Hallador Energy — Investor Presentation (May 2018)
21 slides from Hallador Energy's investor presentation, May 24, 2018
Slide 1: 2018 Overview
2018 OVERVIEW [= Wednesday, May 23rd Hallador:
Slide 2: Sunrise Coal's
Sunrise Coal’s HALLADOR ENERGY COMPANY PB
Slide 3: Board of Directors
Board of Directors VALLADOR ENERGY COMPANY i
Slide 4: Hallador: We Mine
Hallador: We Mine In 2017, Hallador accomplished the following results: *Eamings/Share $1.08 * Dividends /Share $16 * Capital Investment $28.6 MM "Debt Repayment $36.6 MM In the 40 months between purchasing Vectren Fuels (the Oaktown mines) and year-end 2017: # We have utilized our free cash flow to
Slide 5: Overview & Ownership Structure
Overview & Ownership Structure Hallador Stock Performance! Ppp tiatador tnersy Company tschnge NASOAQ Petr zt ‘Shares Outstanding: 30.0 milion Price: $2.38 A ‘Market Capitalization: $221 milion A ise Value: $421 milion SUNRSECOAL SUNRISEENERGY = HOURGLASS ree Apt he ee i Qa a tegen ‘er cttw
Slide 6: Carlisle Mine and Oaktown Mine
‘ce WHE HOLE MIE CARLISLE MINE OAKTOWN MINE HALLADOR ENERGY COMPANY
Slide 7: Selected Financial Data
S ] d December 31 c (e Cc ie (in thousands, except per share data) F ° ° l 2017 16 01 201 a C a Current Assets $71,637 $82,750 $66,615 $ 84,409 $40,170 D a ta Long-Term & Other Assets 446,556 448,573 478,875 495,176 219,029 Total Assets 518,193 531,323 545,490 579,585 259,199 Curent Liabilities (Exc
Slide 8: Free Cash Flow Generation
Free Cash Flow Generation Repaid ($ 1 48 M M ) Hallador continues to maintain a strong Of Debt in 40 Months financial profile and has demonstrated its commitment to delever the balance sheet $350 ™ Since 2008, the Company has consistently generated free cash $306 flow and has committed to allocating
Slide 9: Operational Expertise Has Significantly Improved Cash Costs
Operational Expertise Has Siguificandy Improved Cash Costs = Capital Investments Have Help ( Drive Costs Lowe {i) Elevator installation liii) Wash plant improve m drove productivi HALLADOR ENERGY COMPANY
Slide 10: A Commitment To Safety
A Commitment ‘To Safety Hallador is committed to safety and works closely with the Mine Safety and Health Administration (“MSHA”) to ensure that its 765 non-union employees are working in the safest possible conditions at all times. HALLADOR ENERGY COMPANY Recognized Leader in Coal Mine Safety Top M
Slide 11: Controlled Reserves
Controlled Reserves*: Total Reserves’: 2017 Tons Sold: : Production Capacity: 10.9MM AE 3 Hallador Controlled Reserves exclude 35.8MM of controlled reserves and Total Reserves exclude 35.8MM of controlle uncontrolled reserves for Bulldog Mine (unassigned); Hai into. an agreement in October 2017 to s
Slide 12: Favorable Contract Position Provides Strong Cash Flow Visibility
Favorable Contract Position Provides Strong Cash Flow Visibility 20.9MM tons Projected Coal Sales contracted for next five years (2018-2022). At a pace of 7MM tons per year, thisindicates : : 9 (> 6 of our sales are contracted. . Full Year 2018 Full Year 2019 Full Year 2020 = Committed Tons = Uncomm
Slide 13: Stable Customer Base Provides Foundation For Future Contracts
Stable Customer Base Provides Foundation For Future Contracts The strength of Hallador’s customers, () () ) coupled with the company’s low costs and transportation advantages, creates 9 logical, long-t b for f d Lee ato el lere ics ™ Hallador services low cost, emission compliant plants designed to
Slide 14: Consistent Base Demand Through Low Costs
Consistent Base Demand Through Low Costs Hallador utilizes its low operating costs to displace higher cost / lower quality producers anchors 7MM ton annual production levels and creates negotiating leverage amongst a diminished competitive landscape (as disadvantaged tons come offline) Low Cash Cost
Slide 15: Transportation Advantages
DOT Sty, 08 wena Win, null! in \ ~ s ae emery Hallador’s close proximity to customers + flexible transportation options = Transportation Advantages ow” yw” Indian polis a aww" = Sx \\) nit THO yyynnt ttt yt Re S= \ (1) Close Proximity: Most sales travel less than 90 miles = a \ tee (2) Flexible Tran
Slide 16: Quality Advantages Increase Opportunities
Quality Advantages Increase Opportunities « Oaktown has the highest BTU’s in the state (IN) whereas the rest of the state averages 10,700 — 11,300 « Oaktown has low chlorine - less than 0.1% « Oaktown has low arsenic needed for SCR’s HALLADOR ENERGY COMPANY
Slide 17: New Transport Option Expands Customer Base
New ‘Transport Option Expands Customer Base Hallador’s New Princeton Loop is Operating and Shipping Coal to New Customers on the NS Railroad. = Began shipping coal in May of 2018 = ~3.0MM tons of annual capacity on the NS ™ Provides access to 100% of Indiana in-state rail coal demand = The Princeton
Slide 18: Trump Administration Promotes Coal
‘Trump Administration Promotes Coal January 2018 eliminated a policy dictating how certain major sources of hazardous air pollutants are regulated. Under the new interpretation, “major sources” can be reclassed as “area sources,” which are subject to different standards when their emissions reach an
Slide 19: Small Investment, Big Upside
Small Investment, Big Upside February 2018, we capitalized Hourglass Sands, LLC with $8MM in capital = Our goal is to take advantage of the oil and gas industry’s trend toward using locally sourced frac sand, with what we believe is the only permitted frac sand mine in the State of Colorado. = Hourg
Slide 20: Substantial DJ Basin Transportation Advantage
Substantial DJ Basin” , ‘Transportation Advantage - HALLADOR ENERGY COMPANY
Slide 21: Slide 21