Yancoal Australia Ltd. · ASX:YAL
Yancoal Australia — H1 2023 Earnings Presentation
29 slides from Yancoal Australia's earnings presentation, Aug 16, 2023
Slide 1: Yancoal Australia 1H 2023 Financial Result
Yancoal Australia 1H 2023 Financial Result 16 August 2023 Yancoal Australia Ltd Investor Relations Contact: Brendan Fitzpatrick, GM Investor Relations - Brendan.Fitzpatrick@yancoal.com Level 18, Tower 2, 201 Sussex Street, Media Relations Contact: Matthew Gerber, GM Corporate Affairs - Matthew.Gerbe
Slide 2: 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 3: 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 4: 1H 2023 Key Numbers
1H 2023 Key Numbers $4.0 billion Revenue 44% improvement in TRIFR rate to 4.4 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.) $278/t Average Realise
Slide 5: Safety Performance
Safety Performance YAL Sites 12 month rolling TRIFR and LTIFR • TRIFR reduction demonstrates the effectiveness of the programs in place, 10 and the active engagement of the 9 workforce. 8 7 • Significant improvement in the LTIFR rate. • In 2023, Yancoal continued its “Safe Way 6 5 Every Day” program
Slide 6: Environment, Social and Governance (ESG)
Environment, Social and Governance (ESG) • Published Yancoal’s 5th ESG Report • Established a dedicated team to develop the Yancoal Sustainability Strategy • Signed three Aboriginal Cultural Heritage Conservation Agreements over 770 hectares at MTW, providing permanent protection • Implemented fuel
Slide 7: 1H 2023 Operational Performance
1H 2023 Operational Performance Operating factors 1H 2023 1H 2022 Change Observations ROM coal production, (Mt) 26.0 25.8 1% Production uplift in 2Q 2023 over 1Q, and further Saleable coal production, (Mt) 18.6 20.8 (11%) production gains targeted in 3Q and 4Q. Attributable coal production, (Mt) * 1
Slide 8: Thermal and Metallurgical Coal Market Conditions
Thermal and Metallurgical Coal Market Conditions Thermal benchmarks & YAL Average thermal coal sale price (US$/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 9: Thermal and Metallurgical Coal Market Conditions
Thermal and Metallurgical Coal Market Conditions Met. coal benchmarks & YAL Average met. coal sale price (US$/t)* • The relative price ratios between the 700 thermal coal and metallurgical coal indices 600 that Yancoal utilises are now substantially consistent with prior years. Also, Chinese 500 dom
Slide 10: Product Mix and Sales Volume Split
Product Mix and Sales Volume Split 1H 2023 Final destination for coal volumes managed by Yancoal Marketing* • Yancoal responded to market conditions in 1H Europe, 0% Other, 1% 2023 and rebalanced its customer base, Sth East Asia, 1% China, 24% resuming coal exports to China as trade flows Australia,
Slide 11: The largest coal focused company on the ASX
The largest coal focused company on the ASX • In 2022, the total Australian saleable thermal coal production is ~207Mt. Yancoal’s equity attributable thermal coal production is about 12% of the national total. * • Attributable coal production is the third largest, after BHP and Glencore. • Three lar
Slide 12: ROM Coal Production
ROM Coal Production ROM Production by Asset (100% basis)* (Million tonnes) • Total ROM mined (100% basis) was 26Mt, Moolarben Mt Thorley Warkworth an increase of 5% from 2H 2022. This Hunter Vally Operations Yarrabee Stratford Duralie Middlemount included a 32% uplift in 2Q 2023 over 1Q Ashton 2023
Slide 13: Saleable Coal Production
Saleable Coal Production Attributable Saleable Production by Asset * • Saleable coal production also increased (Million tonnes) Moolarben Yarrabee MTW Stratford Duralie HVO Ashton from the 2H 2023 with production rising at Non-attributable the three large open-cut mines. 30 • Through the first six m
Slide 14: Cash Operating Costs
Cash Operating Costs Cash operating costs (per product tonne) (A$/tonne) • Increase in cash operating costs to A$109/tonne was consistent with 2H Raw materials Employee benefits Transportation 2022. Contracting 120 Other • Lower production volumes combined with the production recovery program 3 4 10
Slide 15: Operating Cash Margin
Operating Cash Margin Operating cash margin components (per product tonne) • Coal prices retreated from 2022 levels in response to international energy market (A$/tonne) Cash operating costs Royalty Implied operating cash margin conditions yet are robust compared to past years. 500 450 • Royalties w
Slide 16: 2023 Operational expectations
2023 Operational expectations Operating component 2023 Expectation As mining inventory rebuilds and productivity rates improve over coming quarters, production Attributable saleable coal levels should increase towards the levels experienced in prior years. production 2023 attributable saleable produ
Slide 17: 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 18: 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$/t 7,000 500 4,000 66% 65% 451 450 3,500 57% 6,000 400 3,000 5,000 350 46% 314 2,500 278 300 4,000 25
Slide 19: Profit and Operating Cashflow
Profit and Operating Cashflow Profit / (Loss) after tax Operating cash flow (A$ 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 20: 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 $300 million. 24% 2,000
Slide 21: Dividend
Dividend Dividends (A$ Million) • 2023 Interim dividend allocation is $489 million, A$0.3700/share (fully franked). Interim Div. Final Div. Special Div. 1,000 • The ~A$1.23/share 2022 Total dividend was a 900 20% dividend yield on the A$6.06/share year end 800 270 share price. 700 • Franking credits
Slide 22: Appendices and Additional Information
Appendices and Additional Information 22
Slide 23: Executive Leadership Team
Executive Leadership Team 23
Slide 24: Yancoal Overview
Yancoal Overview Map of Yancoal operations Milestones in Yancoal’s growth 18 years of growth through prudent acquisitions 24 * Managed, not owned, by Yancoal
Slide 25: Yancoal operations summary
Yancoal operations summary • An interest in 7 producing coal mines and operates 2 mines on management contracts. • Total annual production across the 9 mines is about 70 million tonnes of ROM coal and 55 million tonnes of saleable coal, and nearly all the saleable coal enters the export market. Moun
Slide 26: Stratford Renewable Energy Hub
Stratford Renewable Energy Hub • Renewable energy hub could provide an excellent opportunity for the beneficial re-use of land and support the energy market transition. • Feasibility study is underway, and concept remains subject to permitting requirements and relevant approval processes. • Central
Slide 27: Yancoal market capitalisation and daily turnover
Yancoal market capitalisation and daily turnover A$/sh ASX - A$/sh and Shares traded ADT mn • 1.32 billion shares for an approximate market 7.50 14.00 capitalisation of A$6.7 billion. 7.00 6.50 12.00 • 84% of shares held on ASX and 16% of shares held on 6.00 10.00 HKEx. 5.50 8.00 • Shares are fully
Slide 28: Dual listed on ASX and HKEx – shares fully fungible
Dual listed on ASX and HKEx – shares fully fungible Summary share register 12 Month Share price activity 8.00 45.00 Shareholders * Shares % of IC 7.00 40.00 Yankuang Energy 822,157,715 62.26 6.00 35.00 30.00 HKD/Share 5.00 Cinda International 181,474,887 13.74 A$/share 25.00 4.00 20.00 Directors & M
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