Slide 1: Full Year Results FY23
Full Year Results FY23 24 August 2023 Authorised for release by the Board of Whitehaven Coal Limited Investor contact Media contact Kylie FitzGerald Michael van Maanen +61 2 8222 1155, +61 401 895 894 +61 2 8222 1171, +61 412 500 351 kfitzgerald@whitehavencoal.com.au mvanmaanen@whitehavencoal.com.au
Slide 2: Contents and Disclosure
Contents Disclosure FORWARD LOOKING STATEMENTS 1. Whitehaven Coal’s 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, in
Slide 3: FY23 highlights
FY23 highlights 13% improvement in Strong underlying 18.2Mt ROM Record demand for high-CV coal production impacted by $4.0b EBITDA and TRIFR1 to 4.7 and underpinning record flooding events, labour ZERO environmental realised coal price shortages and constraints at $2.7b NPAT enforcement actions Maul
Slide 4: Whitehaven Coal's markets and products
Whitehaven Coal’s markets and products
Slide 5: Premium products delivered into premium markets
Premium products delivered into premium markets Europe 2 16.3M tonnes managed sales volumes in FY231 Other2 Europe 5% 1% Malaysia 7% 1 12 Japan Korea 1 4 Korea 9% - 2 Taiwan Japan 63% Taiwan Malaysia - 1 1 Vietnam 15% Indonesia 1 1 1 New Caledonia 2 2 Metallurgical Coal Customers Japan, Taiwan & Sou
Slide 6: Producing the highest quality seaborne thermal coal
Producing the highest quality seaborne thermal coal Whitehaven’s average delivered NCV of ~61001 kcal & 10% Ash for total thermal coal exports in FY23 Percentage of thermal coal exports by quality – FY23 15M 199M 138M 45M 64M 73M 543M Total tonnes exported FY23 quality outcomes1 100% • In FY23, 80%
Slide 7: Our coal is efficient when combusted
Our coal is efficient when combusted Relative to other coals, less Whitehaven coal is required to produce the same amount of energy Comparative coal feed rates (%)1 • The required feed rate for all reference coals to deliver the same power output is higher than that of Whitehaven coal • Higher feed
Slide 8: Our coal is lower in emissions
Our coal is lower in emissions Demand for high quality, high-CV, low ash coal is increasing in efforts to reduce CO2-e emissions Coal-fired power plants – GHG emissions per MWh sent out1 • Whitehaven’s thermal coal is used in high-efficiency, low emissions (HELE) electricity generation including 42%
Slide 9: Providing energy security for our customers
Providing energy security for our customers Our coal produces lower emissions and provides energy security for our customer countries Contribution to baseload electricity from Whitehaven managed coal supplied into Japan, South Korea & Taiwan (JKT) Japan South Korea Taiwan Whitehaven’s coal produces
Slide 10: With reliable energy required for transition, strong demand is forecast
With reliable energy required for transition, strong demand is forecast Forecast demand curves for seaborne thermal coal to 2040 1400 • We consider several external demand forecasts 1200 • Commodity Insights forecast 1000 seaborne thermal coal demand to grow to ~1200Mt by 2040 with 800 thermal coal
Slide 11: A significant supply gap is forecast for HCV coal
A significant supply gap is forecast for HCV coal Commodity Insights forecast seaborne supply & demand for High CV coal (>5850 NCV) 400 • Commodity Insights studied 350 HCV supply and demand taking into account limited expansion 300 139Mt projects in the pipeline Million tonnes 250 • With several la
Slide 12: A substantial supply gap is also expected for HCC
A substantial supply gap is also expected for HCC Global supply / demand for HCC will impact economic development and the energy transition 300 • Metallurgical coal is essential for 74Mt the global energy transition plan 250 as well as developing countries’ infrastructure growth 200 Million tonnes •
Slide 13: FY23 external factors impacting Whitehaven
FY23 external factors impacting Whitehaven Supply & demand Record gC NEWC Weather events Labour constraints factors prices • Severe weather / flooding and cost inflation • HCV coal in high demand • WHC’s achieved thermal impacted our assets in • Ongoing labour for baseload supply coal price of US$30
Slide 14: FY23 Results – overview and operations
FY23 Results – overview and operations
Slide 15: Excellent safety and environmental performance
Excellent safety and environmental performance Whitehaven recorded a TRIFR for employees Whitehaven received ZERO environmental and contractors of 4.7 for FY23, a 13% enforceable actions in FY23, a significant improvement on FY22 improvement on recent years 25 12 Environmental enforceable actions RO
Slide 16: Highly engaged people and communities
Highly engaged people and communities Approx. 75% 10.5% 17.3% 5% increase in of 2,750-strong of workforce identify female employee workforce engagement workforce based in as Aboriginal and/or participation in our scores to 6.6 out of 10 local communities Torres Strait Islander workforce up from 15.3
Slide 17: FY23 financial highlights
FY23 financial highlights Sought-after coal products and record Returning capital prices underpin record earnings to shareholders Achieved coal price1 NPAT Final franked dividend2 A$445 / tonne $2.7 billion 42 cents to be paid 15 September 2023 Revenue Cash generated by operations Total returns to s
Slide 18: ROM waterfall
ROM waterfall M tonne (0.2) (0.6) (1.0) 1.7 (1.2) (0.4) Primarily Strong Impacted by AHS and Largest Geotechnical localised performance localised congestion longwall move slip at Werris flooding from Narrabri flooding that related since Narrabri Creek cutting off cut off access constraints commenced
Slide 19: Maules Creek
Maules Creek Impacted by H1 flooding / weather, labour shortages and AHS constraints Managed ROM coal production (Mt) • FY23 ROM production of 9.6Mt, 15% below FY22 due to: – localised flooding cutting off mine access for 24 days in H1 Guidance range 9.6 10.1 – 11.2Mt – labour shortages – congestion
Slide 20: Narrabri
Narrabri Solid H1 production with successful rehand of longwall into 200 series Managed ROM coal production (Mt) • ROM production 5.3Mt, up 9% on FY22 Guidance range 6.0 – 6.7Mt • Consistent ROM production delivered 5.3 strong H1 results 1.7 • Largest longwall move including H2 7.3 rehanding of equi
Slide 21: Narrabri – life of mine plan
Narrabri – life of mine plan 200 series of panels expected to provide improved geological stability • Move to shallow ground expected to provide improved mining conditions for LW203 • Ramping up in Q1 to deliver expected solid production in FY24 • No longwall move required in FY24 • Cut & flit suppl
Slide 22: Gunnedah open cuts
Gunnedah open cuts Wet weather and geotechnical slip impacted production Managed ROM coal production (Mt) • FY23 ROM production 3.4Mt, 15% below FY22 but in line with guidance • Tarrawonga coal being washed hard to optimise coal quality and portfolio blending 3.4 • Werris Creek production consistent
Slide 23: Operational performance
Operational performance Key initiatives underway to improve operational performance LIFT Business Improvement program – Labour initiatives – delivering results through: Leadership, Improvement, Fundamentals, Teamwork • Broadened recruitment reach – national advertising, school • LIFT Team in place &
Slide 24: Early mining at Vickery – low risk, low capital
Early mining at Vickery – low risk, low capital Utilising surplus processing and supply chain capacity to deliver HCV thermal A low capex ($150m) project • Project announced April 2023 • Works commenced in June 2023 quarter • First coal expected around mid CY2024 VEP Early Yellow area is a Mining 20
Slide 25: FY23 Results – financials
FY23 Results – financials
Slide 26: Financial history
Financial history Record earnings and cash generation Revenue ($m) EBITDA ($m) NPAT (before significant items) ($m) FY23 6,064.7 FY23 3,985.6 FY23 2,668.1 FY22 4,920.1 FY22 3,060.1 FY22 1,952.0 FY21 1,557.0 FY21 204.5 FY21 (87.3) FY20 1,721.6 FY20 306.0 FY20 30.0 FY19 2,487.9 FY19 1,001.2 FY19 564.9
Slide 27: EBITDA margin
EBITDA margin Record pricing and a quality focused strategy delivered exceptional results FY23 FY22 Coal sales (equity basis, excluding purchased coal Mt 12.7 14.2 and coal reservation sales) Average revenue (excluding purchased coal, A$/t 413 300 coal reservation sales & after applicable royalties)
Slide 28: FY23 EBITDA vs FY22
FY23 EBITDA vs FY22 $m (315) 431 (238) 46 1,002 FX FY23 FY22 AUD:USD 0.67 0.73 Achieved Prices FY23 FY22 Thermal (US$/t) 305 239 3,986 Metallurgical (US$/t) 261 232 Overall (A$/t) 445 325 3,060 FY22 Price (net of royalty) FX Sales Volume Costs Other FY23 28
Slide 29: Realised pricing at record levels in FY23
Realised pricing at record levels in FY23 WHC’s realised WHC’s thermal coal price premium WHC’s overall realised thermal coal price (US$/t) / discount to gC NEWC (%) coal price (A$/t) FY23 US$305 FY23 1% FY23 A$445 FY22 239 -4% FY22 FY22 325 FY21 68 -14% FY21 FY21 95 FY20 66 FY20 2% FY20 104 FY19 10
Slide 30: FY23 Unit costs $A/t vs FY22
FY23 Unit costs $A/t vs FY22 $/t 7 5 4 3 103 84 FY22 Impact of flooding NCIG accelerated debt Maules Creek Other (incl. diesel & FY23 amortisation operational constraints labour) Cyclical / seasonal Inflationary cost pressures 30
Slide 31: $241m of capital expenditure in FY23
$241m of capital expenditure in FY23 FY23 Capital Expenditure ($m) Includes • Open cuts – fleet overhauls, sustaining capex ($58m) • Narrabri – sustaining capex ($37m) Operations 154 • Narrabri 200 Series mains development ($39m) • Narrabri 200 Series precinct / CHPP upgrade ($20m) • Full scale Vick
Slide 32: Healthy cash generation with $2.65b net cash at year end
Healthy cash generation with $2.65b net cash at year end $m (307) (1,586) (77) 0 3,584 Includes: • Buy-back $948.9m1 (incl completion of initial 10% buy-back) 2,652 • $366.5m for FY22 final dividend and $272.3m for FY23 1,038 interim dividend 1 30-Jun-22 Net cash from operating Investing Returns to
Slide 33: Utilisation of $2.65 billion net cash
Utilisation of $2.65 billion net cash Net cash retained for income tax, dividends, buy-backs and growth $m (889) (337) 2,652 1,426 Net cash at 30 June 2023 FY23 income tax payable in FY24 FY23 final dividend Net cash after income tax and capital returns 33
Slide 34: Net cash and liquidity
Net cash and liquidity $m 30 Jun 2023 30 Jun 2022 • Disciplined capital allocation framework in place Cash on hand 2,775.5 1,215.5 ECA1 (38.7) (48.2) • Continued strong cash generation expected, underpinned by demand for Finance leases (87.3) (135.5) high quality coal and tight supply Capitalised up
Slide 35: Capital allocation framework
Capital allocation framework Capital used to build balance sheet strength and provide returns to shareholders Operating cash flows 1 2 3 Currently targeting Maintain & optimise Retain cash / maintain Return to shareholders ~20%-50% NPAT payout ratio for distributions operations balance sheet strengt
Slide 36: We aim to return 20% to 50% of NPAT to shareholders
We aim to return 20% to 50% of NPAT to share- holders through dividends and buy-backs Capital returned to Capital allocated to Payout ratio shareholders ($m) shareholders ($m) (% of NPAT1) • The share buy-back 2 3 has reduced issued FY23 1,587.7 FY23 609.4 723.6 1,333.0 50% share capital entitled to
Slide 37: FY24 market outlook and guidance
FY24 market outlook and guidance
Slide 38: FY24 market outlook
FY24 market outlook The outlook is positive with strong market dynamics • Customers’ focus on energy security Forward price curves for gC NEWC and PLV HCC US$/t1 and longer supply contract terms expected to continue $400 • Resilience of gC NEWC through $350 seasonally lower demand period is $300 pos
Slide 39: FY24 guidance
FY24 guidance FY23 FY24 Key elements Comments actual Guidance Managed ROM Coal Production Mt 18.2 18.7 – 20.7 Maules Creek Mt 9.6 10.1 – 11.2 AHS development to continue in FY24 Narrabri Mt 5.3 6.0 – 6.7 Gunnedah Open Cuts Mt 3.4 2.6 – 2.8 Werris Creek reaches end of mine life during H2 Managed Coal
Slide 40: FY24 capital expenditure guidance
FY24 capital expenditure guidance Capex uplift reflects investments in Narrabri 200 Series and early mining of Vickery FY24 Expected Capital Expenditure ($m) Includes • Open cuts fleet overhauls, sustaining capex (~$70m – $85m) • Narrabri sustaining capex (~$45m – $65m) Operations 185 – 250 • Narrab
Slide 41: Narrabri – investment in 200 & 300 series panels
Narrabri – investment in 200 & 300 series panels Developing the 200 series and Stage 3 requires a multi-year capex spend 200 series panels Stage 3 Extension Project – 300 series panels • 200 series expected to provide improved geological stability • Extends approved LOM from 2031 to 2044 • Annual pr
Slide 42: Narrabri – bring forward the longwall replacement
Narrabri – it is sensible to bring forward the longwall replacement to deliver early benefits Two longwalls operating sequentially maintains production during longwall moves 42
Slide 43: Whitehaven's FY24 focus areas
Whitehaven’s FY24 focus areas Operational reliability and cost management are key priority areas • Safety and environmental management • Deliver FY24 guidance • Operational reliability and consistency • Cost management while optimising quality • Responding and adapting to government policy changes –
Slide 44: Thank you
Thank you
Slide 45: Appendices
Appendices
Slide 46: Gunnedah Basin and expanding to Bowen Basin
Gunnedah Basin and expanding to Bowen Basin Whitehaven is the largest independent producer of high-CV coal in Australia Indicative product Ash range, % Strip ratio quality, kCal/kg1 Early Vickery >6400 6-10% ~9:1 Maules Creek ~6300-6400 6-10% ~6:1 Tarrawonga ~6300-6400 6-11% ~11:1 Narrabri ~5800-590
Slide 47: Thermal coal prices (US$/t)
Thermal coal prices (US$/t)1 Stock building and a mild Northern Hemisphere winter has resulted in lower spot demand and price moderation ahead of expected upward price pressure for gC NEWC $500 Russia invades Stock building, Russian • Prices have retreated from record Ukraine sanctions, restructurin
Slide 48: Metallurgical coal prices (US$/t)
Metallurgical coal prices (US$/t)1 China’s reopening to Australian coal continues to support prices $700 • Steel demand and met coal $600 pricing remains dictated by China market conditions $500 • However, growing Indian coal $400 demand will increasingly influence market dynamics $300 • India’s str
Slide 49: Asia demand for met coal forecast to grow by 33%
Asia demand for met coal forecast to grow by 33% over the next 3 decades due to Indian industrialisation Asia seaborne demand for metallurgical coal Asia seaborne demand by metallurgical coal type 350 Million Tonnes Million Tonnes 240 HCC 300 PCI 200 Pakistan SSCC 250 Malaysia 191 Taiwan 160 200 Vie
Slide 50: FY23 ROM coal production and sales
FY23 ROM coal production and sales Whitehaven managed ROM coal production (Mt) Whitehaven managed sales of coal produced (Mt) 23.2 20.0 20.7 20.6 20.0 17.8 17.8 17.6 18.2 16.0 11.7 9.3 10.7 7.9 12.7 11.2 9.6 9.6 9.6 7.3 6.4 5.7 6.1 6.2 4.8 4.5 4.6 5.3 4.1 5.3 5.1 5.0 3.9 3.8 4.0 3.4 3.7 3.6 3.3 3.4
Slide 51: Our portfolio of assets provides growth options
Our portfolio of assets provides growth options Long-life existing assets coupled with growth projects of highly sought after products 2023 2024 2025 2026 2027 2028 2029 2030 2040 Production1 & LOM Werris Current production Werris Creek mining Creek ~1.5 Mtpa to conclude in H2 FY24 Current productio
Slide 52: Profit and Loss
Profit and Loss $m FY23 FY22 Revenue 6,064.7 4,920.1 Other income 7.6 7.1 Operating expenses (911.1) (764.3) Coal purchases (317.9) (308.0) Rail, port, marketing and royalties (807.2) (746.2) Admin and other expenses (including net FX gain) (50.5) (48.6) EBITDA 3,985.6 3,060.1 Depreciation & amortis
Slide 53: Costs
Costs Unit cost calculation The unit cost can be calculated off the face of the P&L. It includes operating FY23 Costs expenses, selling & distribution expenses, administration expenses (net of sundry revenues) and share-based payment expenses. Logistics, Coal purchases, royalties, depreciation & amo
Slide 54: D&A and net finance income/(expense)
D&A and net finance income/(expense) FY23 FY22 Drivers Depreciation & amortisation $226.0m $238.9m Reflects decrease in ROM production at open cuts vs pcp D&A per tonne (sales of own coal) $17/t $17/t Net finance income/(expense) $41.9m ($55.3m) Interest earned on cash balance partly offset by commi
Slide 55: Focused on Scope 1 and 2 emissions, TCFD reporting and ISSB Standards
• Scope 1 emissions arise primarily from Focused on Scope 1 and 2 emissions, Narrabri fugitive emissions and Maules Creek diesel consumption TCFD reporting and ISSB Standards – Improved reporting accuracy for Maules Creek since FY21 through use of site specific fugitive emissions (versus NGER defaul
Slide 56: Scope 1 emissions by source
Scope 1 emissions by source Our Scope 1 emissions are predominantly fugitive emissions from Narrabri and diesel from Maules Creek Scope 1 emissions by facility1 FY23 Scope 1 emissions by source1 FY22 FY23 0.4% Other 787 k tonnes CO2e 520 33% 67% Diesel Fugitive consumption emissions 266 258 67 73 47
Slide 57: Safeguard Mechanism Reform commenced 1 July-23
Safeguard Mechanism Reform commenced 1 July-23 • Scope 1 emissions from Whitehaven’s Narrabri underground mine and Maules Creek open cut mine are covered by the Safeguard Mechanism • Financial impact of scheme on • Production variables for the coal sector based on a single production Whitehaven will
Slide 58: Local community sentiment towards Whitehaven has improved
Local community sentiment towards Whitehaven has improved to its highest level yet Overall positivity has increased significantly. Among those aware of Whitehaven, slightly over half are positive (51%), up from 44% in 2022. Only 18% have a negative opinion, compared to 21% last year. 60 50 40 NET %
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