Yancoal Australia Ltd. · ASX:YAL
Yancoal Australia — Investor Presentation (November 2023)
34 slides from Yancoal Australia's investor presentation, Nov 14, 2023
Slide 1: ASX Release: Company Presentation
YANCOAL AUSTRALIA LTD ADDRESS: Level 18, Tower 2, 201 Sussex Street, Sydney NSW 2000 PHONE: 61 2 8583 5300 FAX: 61 2 8583 5399 WEBSITE: www.yancoal.com.au 13 November 2023 ASX Release: Company Presentation Authorised for lodgement by Yancoal Disclosure Comittee Investor Relations Contact: Brendan Fi
Slide 2: Morgan Stanley Asia Summit
Yancoal Australia Ltd Morgan Stanley Asia Summit 15-16 November 2023 1
Slide 3: Important Notice and Disclaimer
Important Notice and Disclaimer Acceptance - This presentation is issued by Yancoal Australia Limited ABN 82 111 859 119 (“Yancoal”). By accepting, accessing or reviewing this presentation, you acknowledge and agree to the terms set out in this Important Notice and Disclaimer. Summary of information
Slide 4: Important Notice and Disclaimer (Continued)
Important Notice and Disclaimer (Continued) Reserves and Resources Reporting - In this presentation, references to mineral resources (“Resources”) and ore reserves (“Reserves”) for Yancoal are compliant with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserv
Slide 5: Yancoal Overview
Yancoal Overview Map of Yancoal operations Milestones in Yancoal’s growth Almost 20 years of growth through prudent acquisitions 4 * Managed, not owned, by Yancoal
Slide 6: Executive Leadership Team
Executive Leadership Team CHAIR OF THE EXECUTIVE COMMITTEE (CEC) MR NING YUE Mr Yue was appointed Executive Director, Co-Vice Chairman and CEC of Yancoai in September 2023. Mr Yue is @ senior engineer who graduated trom China University of Mining and ‘Technology, and has more than 20 years of experi
Slide 7: Yancoal market capitalisation and daily turnover
Yancoal market capitalisation and daily turnover A$/sh ASX - A$/sh and Shares traded ADT mn • 1.32 billion shares for an approximate market 7.50 14.00 capitalisation of A$6.6 billion. 7.00 • 51% of shares held on HKEX and 49% of shares held 12.00 6.50 6.00 10.00 on ASX. 5.50 • Shares are fully fungi
Slide 8: Dual listed on ASX and HKEx – shares fully fungible
Dual listed on ASX and HKEx – shares fully fungible Summary share register 12 Month Share price activity 8.00 40.00 Shareholders * Shares % of IC 7.00 35.00 Yankuang Energy 822,157,715 62.26 6.00 30.00 5.00 25.00 HKD/Share Cinda International 166,000,017 12.57 A$/share 4.00 20.00 Directors & Managem
Slide 9: Yancoal operations summary
Yancoal operations summary • An interest in 7 producing coal mines and operates 2 mines on management contracts. • Total annual production across the 9 mines is about 70 million tonnes of ROM coal and 55 million tonnes of saleable coal, and nearly all the saleable coal enters the export market. Moun
Slide 10: Yancoal has the third largest coal production profile in Australia
The largest coal focused company on the ASX • In 2023, the total Australian saleable thermal coal production is ~251Mt. Yancoal’s equity attributable thermal coal production is about 13% of the national total. * • Attributable coal production is the third largest, after BHP and Glencore. • Three lar
Slide 11: Thermal and Metallurgical Coal Market Conditions
Thermal and Metallurgical Coal Market Conditions Thermal benchmarks & YAL Average thermal coal sale price (US$/t)* • According to the International Energy Agency (IEA), 500 the global coal demand reached an all-time high in 450 2022, exceeding 8.3 billion tonnes. 400 • The IEA saw 1.5% demand growth
Slide 12: Thermal and Metallurgical Coal Market Conditions
Thermal and Metallurgical Coal Market Conditions Met. coal benchmarks & YAL Average met. coal sale price (US$/t)* • Relative price ratios between thermal coal and 700 metallurgical coal indices that Yancoal utilises 600 are now substantially consistent with prior years. 500 • Metallurgical coal mark
Slide 13: Price realisation elements
Price realisation elements • The Group’s export thermal Units 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 coal is generally priced on either an index price, an API5, 5500kCal US$/t 172 194 195 141 125 102 88 annual fixed price or on a spot price basis; and export GC Newc, 6000kCal US$/t 264 372 421 381 242 1
Slide 14: Sales volume and sales revenue split
Sales volume and sales revenue split Revenue split defined in the notes to the consolidated financial statements Europe, 0% Australia, 1% Vietnam, 4% 1H 2023 Japan, 32% Taiwan, 20% South Korea, 18% China, 15% Thailand, 5% India, 2% Balance, 2% Australia, 1% Vietnam, 8% 2H 2022 Japan, 29% Taiwan, 22%
Slide 15: ROM Coal Production
ROM Coal Production ROM Production by Asset (100% basis)* (Million tonnes) • Total ROM mined (100% basis) of 26Mt, in Moolarben Mt Thorley Warkworth 1H 2023 was 5% up from 2H 2022. Hunter Vally Operations Yarrabee Stratford Duralie Middlemount • 16.1Mt in 3Q 2023 was a further 24% Ashton uplift over
Slide 16: Saleable Coal Production
Saleable Coal Production Attributable Saleable Production by Asset * • Through the first six months of 2023 there (Million tonnes) Moolarben MTW HVO Yarrabee Ashton Stratford Duralie was a determined focus on rebuilding Guidance mining inventory depleted during the past 45 two years. 40 38.3 35.6 36
Slide 17: Cash Operating Costs
Cash Operating Costs Cash operating costs (per product tonne) (A$/tonne) • A$109/tonne cash operating costs in 1H 2023 vs 2023 guidance of $92-102/tonne. • Lower production volumes combined Raw materials Employee benefits Transportation with the production recovery program Contracting Other 120 expe
Slide 18: Operating Cash Margin
Operating Cash Margin Operating cash margin components (per product tonne) • Coal prices retreated from 2022 levels in response to international energy market (A$/tonne) Cash operating costs Royalty Implied operating cash margin conditions yet are robust compared to past years. 500 450 • Royalties w
Slide 19: 2023 Operational expectations
2023 Operational expectations Operating component 2023 Expectation As mining inventory rebuilds and productivity rates improve, production levels should Attributable saleable coal increase towards the levels experienced in prior years. production 2023 attributable saleable production of 31-36 millio
Slide 20: Prices, Revenue and EBITDA
Prices, Revenue and EBITDA Revenue and Average realised price Operating EBITDA and Margin (A$ Million) | (A$/tonne) (A$ Million) | (%) Operating EBITDA EBITDA Margin Revenue Average selling price, A$/t 7,000 500 4,000 66% 65% 451 450 3,500 57% 6,000 400 3,000 5,000 350 46% 314 2,500 278 300 4,000 25
Slide 21: Profit and Operating Cashflow
Profit and Operating Cashflow Profit / (Loss) after tax Operating cash flow (A$ Million) (A$ Million) Profit / (Loss) after tax Operating cash flow 2,000 4,000 1,848 3,778 1,738 3,500 1,500 3,000 2,750 973 2,500 1,000 920 2,000 1,721 500 1,500 1,000 - (129) 500 179 89 (500) - 1H 2021 2H 2021 1H 2022
Slide 22: Debt and Gearing
Debt and Gearing Annual Net Debt and Gearing Ratio* (A$ Million) | (%) • Repaid US$333 million of debt ahead of schedule in March 2023. Combined with Net debt Net gearing, % US$2.76 billion repaid since late 2021 4,000 40% means finance cost savings in 2023 will 3,000 exceed $300 million. 24% 2,000
Slide 23: Dividends
Dividend Dividends (A$ Million) • 2023 Interim dividend allocation is $489 million, A$0.3700/share (fully franked). Interim Div. Final Div. Special Div. Franked dividends 1,000 • The ~A$1.23/share 2022 Total dividend was a 900 20% dividend yield on the A$6.06/share year end 800 270 share price. 700
Slide 24: Appendices and Additional Information
Appendices and Additional Information 23
Slide 25: 1H 2023 Key Numbers
1H 2023 Key Numbers $4.0 billion Revenue The TRIFR incident rate declined by 44% in 1H 2023 17% decrease on 1H 2022 performance 26.0Mt ROM production (100%) $1.8 billion Operating EBITDA 18.6Mt Saleable production (100%) & EBITDA margin of 46% 14.4Mt Saleable production (attrib.) $278/t Average Real
Slide 26: Safety Performance
Safety Performance YAL Sites 12 month rolling TRIFR and LTIFR • TRIFR reduction demonstrates the effectiveness of the programs in place, 10 and the active engagement of the 9 workforce. 8 7 • Significant improvement in the LTIFR rate. • In 2023, Yancoal continued its “Safe Way 6 5 Every Day” program
Slide 27: Environment, Social and Governance (ESG)
Environment, Social and Governance (ESG) • Published Yancoal’s 5th ESG Report • Established a dedicated team to develop the Yancoal Sustainability Strategy • Signed three Aboriginal Cultural Heritage Conservation Agreements over 770 hectares at MTW, providing permanent protection • Implemented fuel
Slide 28: Stratford Renewable Energy Hub
Stratford Renewable Energy Hub • Renewable energy hub could provide an excellent opportunity for the beneficial re-use of land and support the energy market transition. • Feasibility study is underway, and concept remains subject to permitting requirements and relevant approval processes. • Central
Slide 29: 1H 2023 Operational Performance
1H 2023 Operational Performance Operating factors 1H 2023 1H 2022 Change Observations ROM coal production, (Mt) 26.0 25.8 1% Production uplift in 2Q 2023 over 1Q, and further Saleable coal production, (Mt) 18.6 20.8 (11%) production gains targeted in 3Q and 4Q. Attributable coal production, (Mt) * 1
Slide 30: 1H 2023 Financial Performance
1H 2023 Financial Performance Income Statement 1H 2023 1H 2022 Change Observations ($ millions) Revenue 3,976 4,776 (800) Lower realised sale price versus 1H 2022 Operating EBITDA 1,821 3,153 (1,332) Incremental costs associated with the recovery plans Operating EBIT 1,410 2,733 (1,323) D&A consiste
Slide 31: 1Q 2023 Production and Sales data
1Q 2023 Production and Sales data ROM COAL PRODUCTION, Mt Mine type Economic Interest 1Q 2023 4Q 2022 PP Change 1Q 2022 PCP Change 3mth 2023 3mth 2022 Change Moolarben OC / UG 95% 3.1 3.6 (14%) 4.9 (37%) 3.1 4.9 (37%) Mount Thorley Warkworth OC 82.90% 3.3 3.2 3% 3 10% 3.3 3 10% Hunter Valley Operati
Slide 32: 2Q 2023 Production and Sales data
2Q 2023 Production and Sales data ROM COAL PRODUCTION, Mt Mine type Economic Interest 2Q 2023 1Q 2023 PP Change 2Q 2022 PCP Change 6mth 2023 6mth 2022 Change Moolarben OC / UG 95% 6.0 3.1 94% 4.4 36% 9.1 9.3 (2%) Mount Thorley Warkworth OC 82.90% 4.3 3.3 30% 2.6 65% 7.6 5.6 36% Hunter Valley Operati
Slide 33: 3Q 2023 Production and Sales data
3Q 2023 Production and Sales data ROM COAL PRODUCTION, Mt Mine type Economic Interest 3Q 2023 2Q 2023 PP Change 3Q 2022 PCP Change 9mth 2023 9mth 2022 Change Moolarben OC / UG 95% 5.3 6.0 (12%) 4.0 33% 14.4 13.3 8% Mount Thorley Warkworth OC 82.90% 4.5 4.3 5% 3.6 25% 12.1 9.2 32% Hunter Valley Opera
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