Salungano Group Limited · JSE:SLG
Salungano — Wescoal Holdings — Investor Presentation (January 2018)
29 slides from Salungano's investor presentation, Jan 22, 2018
Slide 1: Vanggatfontein Colliery
VANGGATFONTEIN COLLIERY 22 JANUARY 2018
Slide 2: Important Notice
IMPORTANT NOTICE This document has been prepared by Wescoal Holdings Limited (the “Company”). For the purposes of this notice, the presentation that follows (the “Presentation”) shall mean and include the slides that follow, the oral presentation of the slides by the Company, any question-and-answer
Slide 3: Contents
CONTENTS 1 Keaton Integration 2 Delmas footprint 3 Vanggatfontein operation, highlights and financial review 4 Moabsvelden reserve and resources 5 Moabsvelden status update 6 Wescoal group financial review 7 Looking ahead 3 3|
Slide 4: Keaton Integration
KEATON INTEGRATION KEATON ACQUISITION VALUE PROPOSITION • Diversify asset and shareholder bases • Economies of scale and synergies • Expand Group resources project pipeline • Balance sheet and free cash generation KEATON INTEGRATION PROGRAMME IS PROGRESSING WELL • The redeployment process is on trac
Slide 5: Delmas Footprint
DELMAS FOOTPRINT WESCOAL a —— >. yi ~~ X a “Ss, 5|
Slide 6: Site Layout
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW SITE LAYOUT VG4 pit 6|
Slide 7: Highlights
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW HIGHLIGHTS Safety Performance Regulatory status Resources and Reserves LOM block plan ROM to product flow Overview of 5 seam plant Overview of ESKOM plant Performance Moabsvelden Resources 7|
Slide 8: Safety Performance - LTIFR
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW SAFETY PERFORMANCE - LTIFR 0.46 0.23 0.00 1HFY17 2HFY17 1HFY18 FATALITY FREE SINCE INCEPTION 8|
Slide 9: Regulatory Status
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW REGULATORY STATUS • All licensing requirements to operate Vanggatfontein mine are in place • Rehabilitation provisions and closure liabilities have been updated as per the new DMR guidelines • We have submitted applications for amendments to
Slide 10: Coal Resource Estimate - March 2017
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW COAL RESOURCE ESTIMATE - 31 MARCH 2017 COAL RESOURCE (MTIS) (AD)α MTIS RAW COAL QUALITIES (AD) TOTAL RD IM ASH VM FC CV TS DAFVOL INFERRED INDICATED MEASURED COAL (g/cc) (%) (%) (%) (%) (MJ/kg) (%) (%) RESOURCE 5 Seam - 2.3 2.7 4.9 1.59 4.3 3
Slide 11: Coal Reserve Estimate - March 2017
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW COAL RESERVE ESTIMATE - 31 MARCH 2017 ROM COAL RESERVE (AR) ROM COAL RESERVE QUALITIES (AD) TOTAL ROM CV RD IM AS VM FC TS DAFVOL PROBABLE PROVED COAL (MJ/k (g/cc) (%) (%) (%) (%) (%) (%) RESERVE g) 5 Seam 0.6 1.1 1.7 1.59 4.3 31.1 22.1 42.4
Slide 12: LOM Block Plan
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW LOM BLOCK PLAN 12 |
Slide 13: ROM to Product Flow
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW ROM TO PRODUCT FLOW 13 |
Slide 14: 5 Seam Plant Process Flow Diagram
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW 5 SEAM PLANT PROCESS FLOW DIAGRAM 14 |
Slide 15: Eskom Plant Process Flow Diagram
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW ESKOM PLANT PROCESS FLOW DIAGRAM 15 |
Slide 16: Performance
VANGGATFONTEIN OPERATION, HIGHLIGHTS AND FINANCIAL REVIEW PERFORMANCE 1HFY18 2HFY17 1HFY17 ROM (kt) 1 561 1 577 1 185 Revenue (Rm) 561 523 580 EBITDA (Rm) 90 99 91 Number of employees 543 559 542 (including contractors) 16 |
Slide 17: Moabsvelden Resources: Coal Resource Estimate - March 2017
MOABSVELDEN RESOURCES COAL RESOURCE ESTIMATE - 31 MARCH 2017 COAL RESOURCE (MTIS) (AD)α RAW COAL QUALITIES (AD) CV DAFV TOTAL COAL RD IM ASH VM FC TS INFERRED INDICATED MEASURED (MJ/k OL RESOURCE (g/cc) (%) (%) (%) (%) (%) g) (%) 5 Seam - - 2.8 2.8 1.72 4.3 40.0 22.8 32.9 16.6 0.99 40.9 4 Seam - - 2
Slide 18: Wescoal Group Financial Review
WESCOAL GROUP FINANCIAL REVIEW
Slide 19: Group Financial Highlights
GROUP FINANCIAL HIGHLIGHTS September September Increase/ 2017 2016 (decrease) Mining ROM production t’000 3,132 1,567 ▲100% Revenue Rm 1,610 1,039 ▲55% Gross Profit Rm 267 188 ▲42% Non-recurring costs* Rm 3.3 90.8 ▼96% Operating profit Rm 161 101 ▲59% Total comprehensive income Rm 88 62 ▲42% EPS** c
Slide 20: Headline Earnings Per Share - 5 Year Track Record
HEADLINE EARNINGS PER SHARE – 5 YEAR TRACK RECORD HEPS cps 35 30 27.1 27.8 26.7* 25 * 20.2 20 15.2 15.4 15.2 15 12.2 11.4 11.3 10 6.9 5.1 5 0 2013 2014 2015 2016 2017 September 2017 September 2017 Half year Full year Normalised • Excluding additional 125 million BEE shares issued and interest earned
Slide 21: Revenue - 5 Year Track Record
REVENUE - 5 YEAR TRACK RECORD REVENUE Rm 2 500 2 118.0 2 000 1 674.4 1 589.9 1 610.1 1 500 1 147.4 1 039.0 1 000 898.0 676.9 758.0 466.0 500 351.0 0 2013 2014 205 2016 2017 September 2017 Full year Half year • Keaton Energy’s Revenue included in September 2017 amounts to R321m 21 |
Slide 22: Operating Profit Excluding Profit on Sale of PPE - 5 Year Track Record
OPERATING PROFIT EXCLUDING PROFIT ON SALE OF PPE - 5 YEAR TRACK RECORD OPERATING PROFIT Rm 200 160.9 150 122.7 101.0 100.9 100 48.0 45.2 45.5 50 27.2 22.0 17.0 19.0 0 2013 2014 2015 2016 2017 September 2017 Full year Half year 22 |
Slide 23: Strong Cash Flow Generation Maintained
STRONG CASH FLOW GENERATION MAINTAINED CASH FLOW FROM OPERATION Rm 300 254 250 240 PERFORMANCE 206 • Strong cash generation on the back of improved underlying profitability 200 • Cash generated from operations applied: 129 › Capex - R37m 150 98 › Debt reduction - R82m 85 95 88 100 › Dividends - R12m
Slide 24: Segmental Report
SEGMENTAL REPORT Trading Mining Other Total R000 R000 R000 R000 30 September 2017 Total segment revenue 593,078 1,062,579 50,410 1,706,067 Inter-segment revenue - (45,627) (50,320) (95,947) External revenues 593,078 1,016,952 90 1,610,120 Operational EBITDA 31,573 250,365 (7,771) 274,167 Profit from
Slide 25: Statement of Financial Position
STATEMENT OF FINANCIAL POSITION Reviewed Unaudited September 2017 September 2016 NOTES: R000 R000 Non-current assets 2 128 454 629 216 • Substantially strengthened position as a result of the acquisition of Keaton: Property, plant and equipment 1,932,639 504,108 › Mineral Assets R 754 million Invest
Slide 26: Statement of Financial Position
STATEMENT OF FINANCIAL POSITION Reviewed Unaudited NOTES: September 2017 September 2016 R000 R000 • Effects of Keaton acquisition: Total shareholders’ funds 951,677 428,459 › Non-current debt R 162 million Non-current liabilities › Rehabilitation R 267 million Interest bearing loans 177,048 77,039 ›
Slide 27: Looking Ahead - Vanggatfontein and Moabsvelden
LOOKING AHEAD – VANGGATFONTEIN AND MOABSVELDEN • Consolidation of consultants • Different product mix to optimize yield • Evaluation of under ground operations at Vanggatfontein • Re-evaluation of Moabsvelden design • Reduction of fixed cost overheads and standardisation across the group 27 |
Slide 28: Mineral Resource and Reserves - Sep17
MINERAL RESOURCE AND RESERVES – SEP17 (PRODUCTION DEPLETION ADJUSTED) Measured Indicated Inferred Total Resource Resource Resource Resource (Mt) (Mt) (Mt) (Mt) Operating Elandspruit 19.7 - - 19.7 Intibane 1.7 - - 1.7 Khanyisa 7.0 0.4 0.2 7.6 Vanggatfontein 85.4 21.4 - 106.8 Total 113.8 21.8 0.2 135.
Slide 29: Questions?
WESCOAL QUESTIONS?
Wescoal Holdings — Investor Presentation (January 2018) on 6ix