Alpha Metallurgical Resources, Inc. · NYSE:AMR
Alpha Metallurgical Resources — Investor Presentation (June 2022)
26 slides from Alpha Metallurgical Resources's investor presentation, June 2022
Slide 1: Investor Presentation
Investor Presentation June 2022
Slide 2: Forward Looking Statements
Forward Looking Statements This document includes forward-looking statements. These forward-looking statements are based on Alpha's expectations and beliefs concerning future events and involve risks and uncertainties that may cause actual results to differ materially from current expectations. Thes
Slide 3: Table of Contents
Table of Contents Vision, Execution & Leadership 4 Company Overview – Alpha Advantages 9 Operations and Financial Update 14 Market Analysis – Macro Environment Remains Positive 18 Conclusion: Alpha Well-Positioned for the Future 21 Appendix 23 3
Slide 4: Vision, Execution & Leadership
Vision, Execution & Leadership
Slide 5: Alpha Investment Thesis
Alpha Investment Thesis Investment Highlights •1 Largest and Most Quality Diverse Metallurgical Coal Producer in U.S. •2 Portfolio of Long-Lived Metallurgical Mines and Substantial Organic Reserve Growth Opportunities •3 Operational Excellence: Cost Control, Safety, Environmental •4 Advantaged Sales
Slide 6: Pathway to a Pure Metallurgical Coal Portfolio
Pathway to a Pure Metallurgical Coal Portfolio Metallurgical Coal Shipments Expected to Account for More than 90% of the Total Volume by 2023 Met 14% 18% 48% 55% 61% 83% 90% 94% Thermal 86% 82% 52% 45% 39% 17% 10% (1) Based on midpoint of guidance. 6% (2) Targeted goal. 2016 2017 2018 2019 2020 2021
Slide 7: Cost-Efficient, Well-Managed and Robust Operating Portfolio
Cost-Efficient, Well-Managed and Robust Operating Portfolio Note: Production, reserves, resources and list of mines as of 12/31/21. * Contractor mine ** Surface mine 7
Slide 8: Experienced Leadership Team Streamlining Decision-Making
Experienced Leadership Team Streamlining Decision-Making 8
Slide 9: Company Overview – Alpha Advantages
Company Overview – Alpha Advantages
Slide 10: Alpha Snapshot
Alpha Snapshot (1) NYSE: AMR (1) Metrics as of 12/31/21 unless otherwise noted. (4) Measured in tons. (2) Alpha Natural Resources, Inc. founded in 2003. (5) See map on slide 13 for specific countries. (3) See slide 7 for list of mines and preparation plants. (6) Since 2016. 10
Slide 11: Alpha Advantages – Most Diverse Domestic Metallurgical Producer
Alpha Advantages – Most Diverse Domestic Metallurgical Producer Largest Domestic Met Producer (1)(2) Well-Balanced Met Quality Mix (2) 0 LV 14% HVA 35% 13.9 million tons MV 24% Alpha’s 2021 Met Shipments HVB 27% In Millions of tons 13.9 Diversified Revenue Mix (2) 7.0 6.9 6.3 Domestic 24% 2.2 Alpha
Slide 12: Strong Safety and Environmental Performance Continues
Strong Safety and Environmental Performance Continues Non-Fatal Days Lost (NFDL) Violations Per Inspection Day (VPID) 3.0 0.6 National National 2.5 Average 0.5 Average 2.45 0.49 2.0 0.4 1.5 0.3 0.56 0.59 0.53 1.0 2.07 2.18 0.2 1.71 0.5 0.1 0.0 0.0 2019 2020 2021 2019 2020 2021 - Maintained 99.9% wat
Slide 13: Alpha Advantages – Largest Domestic Met Producer & Exporter
Alpha Advantages – Largest Domestic Met Producer & Exporter DTA provides a platform for extensive worldwide exports Port of Hampton Roads (Newport News, Virginia) 65% Owned by Alpha (35% by Arch) 22 million tons of capacity (14.3 million attributable to Alpha) 1.7 million tons of ground stor
Slide 14: Operations and Financial Update
Operations and Financial Update
Slide 15: Multi-Faceted Shareholder Value Creation Program
Multi-Faceted Shareholder Value Creation Program Debt Elimination • Eliminated term loan balance on June 3, 2022, with over $550mm paid since 3Q21 Share Repurchase • $600mm program in place with ~$126mm executed as of 6/3/22 Dividend Program • Fixed cash dividend of $1.50 per share annually, with $0
Slide 16: 2022 Capital Expenditures – Investing in Alpha’s Future
2022 Capital Expenditures – Investing in Alpha’s Future $250.0 $175 million* $200.0 expected 2022 capex $55 Million* $150.0 Project Investment In millions $100.0 $120 Million* Maintenance $50.0 Capex $81.9 $192.4 $154.0 $83.3 $0.0 2018A 2019A 2020A 2021A 2022E* *Midpoint of Guidance 16
Slide 17: 2022 Anticipated Capex Investment Projects
2022 Anticipated Capex Investment Projects Alpha’s 2022 Capital Expenditures guidance includes roughly $120 million* in maintenance capital, increased due to inflationary pressure on labor and supplies, and another approximately $55 million* for special investment projects to enhance our portfolio.
Slide 18: Market Analysis – Macro Environment Remains Positive
Market Analysis – Macro Environment Remains Positive
Slide 19: Met Pricing Strength Continues into 2022
Met Pricing Strength Continues into 2022 Metallurgical Coal Indices $790.00 $690.00 $590.00 $490.00 $ / metric ton $390.00 $290.00 $190.00 $90.00 US High Vol A US High Vol B US Low Volatile Premium Low Vol HCC Sources: Bloomberg and Platts 19
Slide 20: Global Steel Demand Growth Expected to Continue
Global Steel Demand Growth Expected to Continue Global Steel Demand Projected Crude Steel Production 1,900 in India through 2050 1,881 380 1,850 1,840 +2% 360 1,834 340 320 300 1,800 In 000s of metric tons In 000s of metric tons 280 1,775 260 +5% CAGR 240 1,750 220 200 180 1,700 160 140 120 100 1,65
Slide 21: Conclusion: Alpha Well-Positioned for the Future
Conclusion: Alpha Well-Positioned for the Future
Slide 22: Conclusion: Alpha Plans to Harvest Benefits of Disciplined Planning
Conclusion: Alpha Plans to Harvest Benefits of Disciplined Planning Elimination of long-term debt and significant reduction of legacy liabilities that provides 1 the opportunity to return significant capital • Dramatic reduction in long-term debt and legacy liabilities, including early prepayments a
Slide 23: Appendix
LPHA METALLURGICAL RESOURCES Appendix
Slide 24: 2022 Guidance (as of May 5, 2022)
2022 Guidance (as of May 5, 2022) Shipments (million tons) Low High Metallurgical 14.0 15.0 Non-Metallurgical By-Product 0.8 1.2 Met Segment 14.8 16.2 All Other 0.6 0.8 Total Shipments 15.4 17.0 Committed / Priced Volumes(1)(2)(3) % Committed Average Price ($/ton) Metallurgical – Domestic $189.22 Me
Slide 25: Federal Net Operating Losses (NOL) and Usage Limitations
Federal Net Operating Losses (NOL) and Usage Limitations US $ millions Year Estimated Gross Estimated NOL Year Generated Expires NOL Carryforward at Deduction Available 12/31/2021 for Utilization in 2022 2015(1) 2035 $ 1,008.0 $ 1.0 2017(1) 2037 270.0 18.7 2019(2) N/A 79.5 79.5 2020(2) N/A 185.9 185
Slide 26: Cash-Related Outflows Expected to Materially Decrease After 2022
Cash-Related Outflows Expected to Materially Decrease After 2022 Cash Outlays (US$ millions) 2022 2023 2024 2025 Acquisition Related Obligations $6.6 $ -- $ -- $ -- Contingent Revenue Obligations (1) 29.4 5.1 -- -- Reorganization & Transaction-related Cash Outlays $36.0 $5.1 $-- $-- Asset Retirement
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