Slide 1: SunCoke Energy, Inc. Q2 2019 Earnings Conference Call
SunCoke Energy, Inc. Q2 2019 Earnings Conference Call
Slide 2: Forward-Looking Statements
Forward-Looking Statements 2 This slide presentation should be reviewed in conjunction with the Second Quarter 2019 earnings release of SunCoke Energy, Inc. (SunCoke) and conference call held on July 30, 2019 at 10:30 a.m. ET. Except for statements of historical fact, information contained in this p
Slide 3: Q2 2019 Highlights
Q2 2019 Highlights 3 Completed Simplification Transaction with overwhelmingly favorable support from SXC shareholders Achieved solid operating performance despite record flooding and adverse weather conditions Delivered Q2 ‘19 Adjusted EBITDA of $63.1M; ended quarter with ample liquidity posit
Slide 4: Q2 2019 Financial Performance
Q2 2019 Financial Performance 4 Q2 2019 Earnings Review Q2 ‘19 EPS of $0.03, down $0.03 from ($/share) ($ in millions) Diluted EPS Adj. EBITDA(1) the prior year quarter • Mainly driven by higher depreciation expense and Simplification Transaction costs(3) partially offset by loss from equity method
Slide 5: Adjusted EBITDA – Q2 '18 to Q2 '19
Adjusted EBITDA(1) – Q2 ‘18 to Q2 ‘19 5 Q2 ‘19 performance driven by strong Domestic Coke operations offset by lower CMT volumes ($ in millions) $2.9 ($7.9) $67.3 $0.8 $63.1 • ($8.6M) – Lower CMT volumes (Excludes deferred revenue of $5.5M) • $0.5M – Increased KRT and Lake Terminal transloading reve
Slide 6: Domestic Coke Business Summary
Domestic Coke Business Summary 6 Strong Q2 ‘19 cokemaking performance supports FY 2019 outlook Domestic Coke Performance Delivered Adj. EBITDA/ton(1) of ~$55 (Coke Production, Kt) vs. ~$53 in Q2 ‘18 $58/ton • Increased production despite adverse $53/ton $55/ton $49/ton $50/ton weather conditions • M
Slide 7: Logistics Business Summary
Logistics Business Summary 7 Lower throughput volumes at CMT impacting Q2 ’19 results Logistics Performance Delivered Q2 ‘19 Adj. EBITDA of $11.8M (Tons Handled, Kt) • Solid throughput volumes at domestic terminals $19.7M $21.0M $18.3M Convent contributed $8.5M to Q2 ‘19 Adj. $12.7M $11.8M EBITDA 6,
Slide 8: Q2 2019 Liquidity
Q2 2019 Liquidity 8 Maintain strong consolidated liquidity of >$360M; continued objective to strengthen balance sheet (Consolidated) Q2 ’19 Consolidated Total Debt $852M Revolver Availability: Gross Leverage(1) 3.14x $261M $143.9 $0.3 ($ in millions) ($31.1) ($7.1) ($1.0) ($2.8) $102.2 • Elevated in
Slide 9: 2019 Key Initiatives
2019 Key Initiatives 9 Deliver Operations Excellence and Optimize Asset Base • Drive strong operational and safety performance while optimizing asset utilization • Successfully execute on capital plan Complete last phase of oven rebuilds at Indiana Harbor • Complete 57 planned B-battery oven rebuild
Slide 10: Questions
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Slide 11: Appendix
SunCoke Energy”
Slide 12: Definitions
Definitions 12 Adjusted EBITDA represents earnings before interest, loss (gain) on extinguishment of debt, taxes, depreciation and amortization (“EBITDA”), adjusted for impairments, loss on extinguishment of debt, changes to our contingent consideration liability related to our acquisition of CMT, l
Slide 13: Reconciliation to Adjusted EBITDA
Reconciliation to Adjusted EBITDA 13 ($ in millions) Q1 '18 Q2 '18 Q3 '18 Q4 '18 FY '18 Q1 '19 Q2 '19 YTD '19 Net Income $ 13.0 $ 11.4 $ 17.1 $ 5.5 $ 47.0 $ 12.2 $ 3.3 $ 15.5 Depreciation and amortization expense 32.9 32.0 35.4 41.3 141.6 37.2 37.0 74.2 Loss on extinguishment of debt 0.3 - - - 0.3 -
Slide 14: Adjusted EBITDA and Adjusted EBITDA per ton
Adjusted EBITDA and Adjusted EBITDA per ton 14 Reconciliation of Segment Adjusted EBITDA and Adjusted EBITDA per Ton Domestic Corporate ($ in millions, except per ton data) Coke Brazil Coke Logistics and Other(1) Consolidated Q2 2019 Adjusted EBITDA $56.3 $4.3 $11.8 ($9.3) $63.1 Sales Volume (thousa
Slide 15: Balance Sheet & Debt Metrics
Balance Sheet & Debt Metrics 15 As of 6/30/2019 SXC ($ in millions) Consolidated Cash $ 102 Available Revolver Capacity 261 Total Liquidity $ 363 Gross Debt (Long and Short-term) $ 852 Net Debt (Total Debt less Cash) $ 750 FY 2019 Adj. EBITDA(1) $ 271 Gross Debt / FY 2019 Adj. EBITDA 3.14x Net Debt
Slide 16: 2019 Guidance Summary
2019 Guidance Summary 16 Guidance remains unchanged from February 2019 announcement 2018 2019 Metric Results Guidance Adjusted EBITDA(1) Consolidated $263.2M $266M - $276M Attrib. to SXC $181.2M $226M - $232M Total Capital Expenditures(2) $97.1M $110M - $120M IHO Oven Rebuilds $33.6M $40M - $48M GCO
Slide 17: 2019 Capital Expenditures
2019 Capital Expenditures 17 2019 CapEx Overview ($ in millions) Low High Ongoing $64 $66 IHO Oven Rebuilds 40 48 Total Ongoing CapEx(1) $104 $114 Environmental Project (Gas Sharing)(2)(3) 6 6 Total CapEx $110 $120 1) At the midpoint of the range 2019 ongoing CapEX includes approximately $104M in on
Slide 18: 2019 Guidance Reconciliation
2019 Guidance Reconciliation 18 ($ in millions) Low High Net Income $40 $47 Depreciation and amortization expense 150 145 Interest expense, net 65 65 Income tax expense 6 14 Simplification Transaction costs(1) 5 5 Adjusted EBITDA (Consolidated) $266 $276 Adjusted EBITDA attributable to noncontrollin
Slide 19: Thermal Coal Export Profitability
Thermal Coal Export Profitability 19 API2 and Newcastle benchmarks remain suppressed during Q2 ‘19 Thermal Coal Mine Netback – Rotterdam $2 $0 Q2 ‘19 API2 benchmark $55 pricing of ~$55/ton ($22) • Premiums to API2 offered on ($3) shipments into Egypt, South America and Asia ($22) $10 • 2020 API2 for
Slide 20: Pro Forma SXC FCF/Share
Pro Forma SXC FCF/Share 20 ($ in millions, except per share amounts) 2019E Net Income $ 44 Depreciation and amoritization expense 148 Interest expense, net 65 Income tax expense 10 Simplification Transaction costs(1) 5 Adjusted EBITDA(2) $ 271 Cost synergies 1 Adjusted EBITDA - Pro Forma $ 272 Cash
Slide 21: SunCoke Energy
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