Whitehaven Coal Limited · ASX:WHC
Whitehaven Coal — Shareholder Meeting (October 2014)
30 slides from Whitehaven Coal's shareholder meeting presentation, Oct 28, 2014
Slide 1: Whitehaven Coal Limited AGM 2014
Whitehaven Coal Limited AGM 2014 A year of delivering on targets Sydney, Australia 28 October 2014
Slide 2: Disclaimer
Disclaimer 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 projections and any estimate
Slide 3: Agenda
Agenda Coal and its future Financial Highlights Community Contribution Target Delivery Safety Sales and Production Narrabri Maules Creek Vickery & Production Growth Conclusion FY2014 AGM 3
Slide 4: Our goal: Australia's premier ASX listed coal company
Our goal Creating Australia’s premier ASX listed coal company 4
Slide 5: Coal in today's world
Coal in today’s world Coal is the power energizing the world Our energy needs in perspective: In just one day... @ wm @ Global lati will increase by 85,000+ 1,100,000 21 0 000 People will move to cities People open ’ in China and India an internet account a Te A million an metric wy 225,000 tons = 9
Slide 6: Coal's growing role in global energy
Coal’s growing role in global energy Nearly 3.5 billion people in the world have limited or no access to electricity Coal is the lowest cost source of electricity for many countries around the world World Demand for Coal (Mtce) 8000.0 BP expects world coal demand to increase by 1.5Bt from 7000.0 201
Slide 7: The case of India
The case of India In India more than 700 million people lack access to modern power for lighting, cooking, water pumping and other productive purposes Sources of electricity by 2030 in India • Wind & Solar 8% • Nuclear, Hydro & Biomass 29% • Coal 63% The cost of solar electricity is estimated to be
Slide 8: Improving technology
Improving technology New technology is reducing carbon emissions from coal fired plants 8
Slide 9: CCS is "commercial"
CCS is “commercial” SaskPower, a large Canadian power generation company has just brought online the world’s first commercial CCS facility in Canada The plant will capture 100% of SO2 and 90% of CO2 emissions and provide power for 100,000 homes CCS can deliver a future for coal fired power stations
Slide 10: Australian political support
Australian political support “Energy is what sustains prosperity and coal is the world’s principle energy source and it will be for many decades to come” and “Coal is good for humanity, coal is good for prosperity, coal is an essential part of our economic future, here in Australia and right around
Slide 11: Where we operate
Where we operate Maules Creek (75%) • Reserves to support ~ 30 years • Permitted & Planned : 13 Mtpa ROM • SSCC, PCI and high energy thermal Narrabri North (70%) • Reserves to support ~ 25 years • Permitted : 8 Mtpa ROM • Planned : 6 Mtpa ROM • PCI & low ash thermal coals Tarrawonga (70%) • Reserves
Slide 12: Community contribution
Community contribution Whitehaven currently employs over 655 people with 74% living in the region around its operating mines Wages paid to employees in the region were over $80 million in FY2014 and will increase in FY2015 First phase recruitment for Maules Creek has been completed with over 1,800 a
Slide 13: Aboriginal engagement
Aboriginal engagement Whitehaven has developed an Aboriginal Engagement Strategy to build on and enhance relationships with the Aboriginal community in which it operates During FY2014 Whitehaven employed a dedicated Aboriginal Community Relations Officer At the Maules Creek project the company worke
Slide 14: Delivering on targets
Delivering on targets TARGETS FY2014 OUTCOME Improve safety performance at all operations Lowest group TRIFR rate in 5 years Ensure current operations are performing to Record production at three mines plan Reduce costs Fully absorbed costs declined by 9% for the year Overcome quality issues in Narr
Slide 15: Safety performance
Safety performance Introduction of Whitehaven’s “Safehaven Rules” during the year is delivering improved safety performance as evidenced by a 30% decline in the TRIFR and a 40% reduction in the LTIFR from the previous year Achieved lowest group wide TRIFR rate for 5 years of 14.06 below the NSW aver
Slide 16: Financial highlights for FY2014
Financial highlights for FY2014 Headlines FY2014 FY2013 Comment EBITDA before significant 90.4 17.1 Significant improvement from previous year items ($’m) Increase in line with EBITDA growth and reduced coal Operating cash flow ($’m) 108.6 (32.3) purchases Average unit cost per tonne Significa
Slide 17: Costs are falling
Costs are falling H2 H1 FY2014 FY2014 (1) FY2014 FY2013 (1) (2) Average revenue per tonne was flat with coal price reduction offset by weakening in the A$ Coal Sales (equity basis, excl. purchased '000t 3,913 4,302 8,215 5,994 (3) coal) Average revenue (excl. purchased coal & net $A/t 77 81 79 79 (3
Slide 18: Sales destination – premium markets
Sales destination – premium markets Thermal Coal Sales 2014 Japan and Korea are key markets for Whitehaven coal 8% 8% Thermal coal sales in FY2014 were 8.9Mt (100% basis) Japan including purchased coal with most sold into the premium 47% Korea Asian markets China 37% Other Metallurgical coal sales t
Slide 19: Record saleable coal production
Record saleable coal production Excellent performance at Narrabri increased Whitehaven’s managed production by 26% to 10.3Mt for the year The open cut mines also performed strongly as Werris Creek and Tarrawonga set new records Whitehaven Managed Coal Production (000's t) 12,000 10,000 8,000 6,000 4
Slide 20: Narrabri performing strongly
Narrabri performing strongly Tier 1 World Class Mine Narrabri Saleable Coal Production (000's t) 6,000 Record ROM and saleable coal production of 5.7Mt and 5.2Mt respectively for FY2014 5,000 Productivity of about 17,000tpmpy (ROM basis) achieved in FY2014 placing the mine amongst 4,000 the most pro
Slide 21: Narrabri beyond FY2015
Narrabri beyond FY2015 Top Coal Caving assessment has been completed and is inferior to the introduction of a wider longwall panel face Increased panel lengths will lead to less changeouts in the future, usually only one in each year Wider panel face (400 metres) - Increases annual productivity of m
Slide 22: Maules Creek construction 75% complete
Maules Creek construction 75% complete All major elements of the Tier 1 world class mine either ahead or on schedule % Complete at 24 Oct 14 Area Contractor Rail Leighton 82% Bulk Earthworks Ditchfield 72% CHPP Design, Supply Sedgman 100% CHPP Erect Downer 48% Water Supply Stripes 100% Power Supply
Slide 23: Project "S" curve
Project “S” curve Whitehaven expects to have spent about $610 million at the time of the first coal shipments from Maules Creek Revenue will begin for coal sales from January 2015, several months before construction activity is completed Commissioning of the remaining mine infrastructure will contin
Slide 24: Maules Creek mining
Maules Creek mining Whitehaven will owner operate the Mining mine with first phase of staff and Model operator recruitment completed, mining commenced Low cost funding secured for new ultra class mining equipment via an Funding & operating lease. Mining equipment Equipment sufficient for an operatin
Slide 25: Maules Creek – Mine infrastructure
Maules Creek – Mine infrastructure 25
Slide 26: Maules Creek – Mine infrastructure
Maules Creek – Mine infrastructure Train loadout bin and stockyard Sleepers and rail line ready for laying 26
Slide 27: Vickery approval
Vickery approval Approval granted by NSW Government in September Vickery Project Key Elements Details Location About 25kms north of Gunnedah Resources and Reserves Reserves of 204Mt contained within a Resource of 508Mt Whitehaven 100%. Will consider the formation of a Joint Venture by Ownership sell
Slide 28: Investment proposition – low cost growth
Investment proposition – low cost growth Saleable Coal Production by Mine (Mt) Production is expected to more than 25.0 double by FY2018 as Maules Creek 125% Growth ramps up to its full capacity 20.0 Saleable production in FY2015 is 15.0 expected to be about 14Mt on a 110% Growth 100% basis (include
Slide 29: Targets for FY2015
Targets for FY2015 Aiming for ongoing improvement in safety performance at all operations Ensuring construction of Maules Creek remains ahead of schedule and under budget Developing long term markets and sales contracts for all Maules Creek production Recruiting and training the workforce to operate
Slide 30: Thank you
Thank you www.whitehavencoal.com.au