Slide 1: Fourth Quarter 2018 Results
Fourth Quarter 2018 Results February 21, 2019 PRELIMINARY | SUBJECT TO FURTHER REVIEW AND EVALUATION These materials may not be used or relied upon for any purpose other than as specifically contemplated by a written agreement with Credit Suisse AG or its Affiliates (hereafter “Credit Suisse”).
Slide 2: Forward looking statements
W ar r ior Met Coal Page 1 Forward looking statements These slides contain, and the Company’s officers and representatives may from time to time make, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Ac
Slide 3: 2018 Achievements
W ar r ior Met Coal Page 2 2018 Achievements 1 Record high operational performance, including full year production of 7.7mst and sales of 7.6mst, both record highs for Warrior ✓ 2 Operated ahead of schedule on production ramp up, enabling increased 2018 guidance targets ✓ 3 Generated Adjusted EBITDA
Slide 4: Warrior Delivered on its Commitments for 2018…
W ar r ior Met Coal Page 3 Warrior Delivered on its Commitments for 2018… Actual Guidance(1) Coal Sales 7.6 Mst 7.1 – 7.5 Mst ✓ Coal Production 7.7 Mst 7.1 – 7.5 Mst ✓ Cash Cost of Sales (Free-on-Board Port)* $93.76 per St $89 - $95 per St ✓ Capital Expenditures $101.6mm $100 - $120mm ✓ S,G&A $36.6m
Slide 5: Key Metrics for Q4 2018 vs. Q4 2017
W ar r ior Met Coal Page 4 Key Metrics for Q4 2018 vs. Q4 2017 Q4 2018 Q4 2017 % Change Tons produced (in 000s Short tons 1,889 Tons produced (in 000s St) 1,573 20% (“St”)) Tons sold (in 000s St) 1,971 Tons sold (in 000s St) 1,355 45% Gross price realization (1) 93% Gross price realization (1) 101%
Slide 6: Key Metrics for 2018 vs. 2017
W ar r ior Met Coal Page 5 Key Metrics for 2018 vs. 2017 FY 2018 FY 2017 % Change Tons produced (in 000s St) 7,735 Tons produced (in 000s St) 6,714 15% Tons sold (in 000s St) 7,640 Tons sold (in 000s St) 6,527 17% Gross price realization (1) 97% Gross price realization (1) 96% 1% Average net selling
Slide 7: Leverage and Liquidity Analysis
W ar r ior Met Coal Page 6 Leverage and Liquidity Analysis Financial Metrics ($MM except ratios) Leverage (for the year ended December 31, 2018) Adjusted EBITDA* $601.0 Consolidated Net Debt* (1) $270.2 Net Leverage Ratio* 0.45x Liquidity (as of December 31, 2018) Cash and Cash Equivalents $205.6 As
Slide 8: Generated Significant Free Cash Flow on Strong Conversion of Adjusted EBITDA Margins
W ar r ior Met Coal Page 7 Generated Significant Free Cash Flow on Strong Conversion of Adjusted EBITDA Margins Adjusted EBITDA Margin*(1) ($ in millions) FCF Conversion*(2) 71% 79% 77% 83% 65% 76% 60.0% 51.3% 50.0% 44.8% 43.6% 39.9% 40.0% 36.0% 34.4% 30.0% 20.0% 10.0% 0.0% Q4 2017 Q1 2018 Q2 2018 Q
Slide 9: Production Growth Continued in 2018
W ar r ior Met Coal Page 8 Production Growth Continued in 2018 Tons Produced (thousand short tons) Longwall 1 - - 3 - - 2 1 moves 2,098 2,000 1,909 1,929 1,889 1,819 1,800 496 1,614 1,620 1,573 517 596 464 1,600 582 1,400 454 480 400 1,200 1,000 800 1,602 1,392 1,425 1,333 600 1,160 1,173 1,237 1,14
Slide 10: Looking Forward: 2019 Full Year Guidance
W ar r ior Met Coal Page 9 Looking Forward: 2019 Full Year Guidance • Continue to Maximize Shareholder Value in 2019 • Coal sales of 7.1 – 7.6 million St • Coal production of 7.1 – 7.6 million St • Cash cost of sales (free-on-board port)* of $89 - $95 per St • Capital expenditures of $100 - $120 mil
Slide 11: Breaking Down Warrior's Capital Expenditures
W ar r ior Met Coal Page 10 Breaking Down Warrior’s Capital Expenditures 2018 Actual vs. Guidance 2019 Guidance ($mm) 2018A Guidance ($mm) Low High Production (Mst) 7.7 7.1 - 7.5 Production (Mst) 7.1 7.6 Capex Capex Sustaining(1) $69 $70 - $83 Sustaining(1) $70 $87 Discretionary(2) $33 $30 - $37 Dis
Slide 12: Warrior Remains Committed to its Stated Financial Policies
W ar r ior Met Coal Page 11 Warrior Remains Committed to its Stated Financial Policies ◼ Generated $458 million of free cash flow* in 2018 with 76% free cash flow Strong Cash conversion(1) Conversion ◼ High price realizations, low cash costs, clean balance sheet, and large net operating loss balance
Slide 13: World-Class Blue Creek Project Provides Warrior with High-Return Option for Growth
W ar r ior Met Coal Page 12 World-Class Blue Creek Project Provides Warrior with High-Return Option for Growth Significant Growth Potential ◼ One of the few remaining untapped premium quality High Vol A coal reserves in the U.S., trading currently at premium prices ◼ Would provide a portfolio of Pre
Slide 14: Recent High Vol A Pricing Dynamics Make Blue Creek Even More Compelling
W ar r ior Met Coal Page 13 Recent High Vol A Pricing Dynamics Make Blue Creek Even More Compelling $350 U.S. High Vol A Price Premium / (Discount) U.S. Low Vol Aus Premium Low Vol Current 8% (1)% 1 Month 6% (0)% $300 1 Year 6% (3)% 2 Years 3% (6)% ($ / Short Ton) $250 $200 $ 183 $ 181 $ 169 $150 $1
Slide 15: Appendix
W ar r ior Met Coal Page 14 Appendix
Slide 16: Appendix
W ar r ior Met Coal Page 15 Appendix For the three months ended For the three months ended December 31, 2018 (Unaudited) December 31, 2017 (Unaudited) Short Tons Metric Tons Short Tons Metric Tons Tons sold (in 000s) 1,971 1,788 1,355 1,229 Tons produced (in 000s) 1,889 1,714 1,573 1,427 Gross price
Slide 17: Appendix
W ar r ior Met Coal Page 16 Appendix For the year ended For the year ended December 31, 2018 (Unaudited) December 31, 2017 (Unaudited) Short Tons Metric Tons Short Tons Metric Tons Tons sold (in 000s) 7,640 6,931 6,527 5,921 Tons produced (in 000s) 7,735 7,017 6,714 6,091 Gross price realization (1)
Slide 18: Non-GAAP Financial Measures: Adjusted EBITDA Reconciliation
W ar r ior Met Coal Page 17 Appendix Non-GAAP Financial Measures Reconciliation of Adjusted EBITDA to Amounts Reported Under U.S. GAAP For the three months ended For the year ended December 31, (Unaudited) December 31, (in thousands) 2018 2017 2018 2017 Net income $ 374,190 $ 97,156 $ 696,787 $ 455,
Slide 19: Non-GAAP Financial Measures: Free Cash Flow Reconciliation
W ar r ior Met Coal Page 18 Appendix Non-GAAP Financial Measures Reconciliation of Free Cash Flow to Amounts Reported Under U.S. GAAP For the three months ended For the year ended December 31, (Unaudited) December 31, (in thousands) 2018 2017 2018 2017 Net cash provided by operating activities $ 130
Slide 20: Non-GAAP Financial Measures: Adjusted Net Income Reconciliation
W ar r ior Met Coal Page 19 Appendix Non-GAAP Financial Measures Reconciliation of Adjusted Net Income to Amounts Reported Under U.S. GAAP For the three months ended For the year ended December 31, (Unaudited) December 31, (in thousands) 2018 2017 2018 2017 Net income $ 374,190 $ 97,156 $ 696,787 $
Slide 21: Non-GAAP Financial Measures: Cash Cost of Sales Reconciliation
W ar r ior Met Coal Page 20 Appendix Non-GAAP Financial Measures Reconciliation of Cash Cost of Sales (Free-On-Board Port) to Cost of Sales Reported Under U.S. GAAP For the three months ended For the year ended December 31, (Unaudited) December 31, 2018 2017 2018 2017 Cost of sales $ 180,238 $ 136,6