Peabody Energy Corporation · NYSE:BTU
Peabody Energy — 6th Annual Jefferies Global Industrial and A&D Conference (August 2011)
26 slides from Peabody Energy's conference presentation, Aug 10, 2011
Slide 1: 6th Annual Jefferies Global Industrial and A&D Conference
6th Annual Jefferies Global Industrial and A&D Conference Vic Svec Senior Vice President Investor Relations & Corporate Communications August 10, 2011 Exhibit 99.1
Slide 2: Statement on Forward-Looking Information
Statement on Forward-Looking Information 2 Some of the following information contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, and is intended to come within the safe-harbor protecti
Slide 3: Peabody Energy: The Only Global Pure-Play Coal Investment
Peabody Energy: The Only Global Pure-Play Coal Investment World Coal: Long-term supercycle in early stages BTU: Unique assets, position and prospects Significant leverage to high-growth Asian markets #1 in fastest growing U.S. regions Major catalysts for growth and increased shareholder value 3
Slide 4: 2011: Targeting Significant Growth
2011: Targeting Significant Growth Second quarter 2011 increases: Revenues +21% EBITDA +32% EPS +61% Liquidity of $2.7 billion Targeting 2011 EBITDA of $2.3 - $2.5 billion Targeting 2011 EPS of $4.20 to $4.60 4 Peabody EBITDA $ in Millions EPS is adjusted diluted EPS from continuing operations. Liqu
Slide 5: Early Stages of Coal Supercycle
Early Stages of Coal Supercycle
Slide 6: Coal: Entering the Early Stages of a Long-Term Supercycle
Coal: Entering the Early Stages of a Long-Term Supercycle 6 Coal: The World's Fastest Growing Fuel for Past Decade Source: BP Statistical Review of World Energy, June 2011. Coal +48% Growth in Major Energy Forms (2000 - 2010) Natural Gas +31% Oil +13% Hydro +29% Nuclear +7%
Slide 7: Coal's Primary Customer Base - Generation - Growing Dramatically
Coal's Primary Customer Base - Generation - Growing Dramatically Source: Platts Worldwide Power Plant Database and Peabody analysis. Expected Generation Growth Driven by Asia New Coal-Fueled Generation 2011 - 2015 (GW) China 250 India 75 Other Asia 27 USA 8 Others 16 Asia represents 90% of expected
Slide 8: Seaborne Thermal Coal: Demand Expected to Outpace Supply
Seaborne Thermal Coal: Demand Expected to Outpace Supply 8 Expected Increase in Seaborne Thermal Demand 2010 - 2015 India China Other Pacific Atlantic Expected Increase in Seaborne Thermal Supply 2010 - 2015 Australia Indonesia Russia S. Africa Colombia Other Source: Peabody analysis. 2010 2015 2010
Slide 9: Global Metallurgical Coal Use Forecast to Rise ~550 Million Tonnes by 2020
Global Metallurgical Coal Use Forecast to Rise ~550 Million Tonnes by 2020 Global steel production expected to rise nearly 60% by 2020 Bulk of market share growth in China and India Trend highlights structural shortage of premium coking coal 9 Expected Global Steel Production and Met Coal Demand Sou
Slide 10: Atlantic Australia Expected to Supply Majority of Global Met Coal Increase
Atlantic Australia Expected to Supply Majority of Global Met Coal Increase 10 Expected Increase in Seaborne Met Demand 2010 - 2015 Expected Increase in Seaborne Met Supply 2010 - 2015 Source: Peabody analysis. 65 - 75 Brazil India China Europe South Korea Japan 85 - 95 Australia Mongolia Other Pacif
Slide 11: Expected U.S. Coal Demand Change 2010 - 2015
Expected U.S. Coal Demand Change 2010 - 2015 (Tons in Millions) 60-70 45-55 (45-55) Estimates based on Peabody analysis and industry reports. Includes exports. CAPP Challenged by Permitting, Geology, Safety, Cost Structure CAPP ILB SPRB ILB Fastest Growing Region; PRB Growing To East and Far East PR
Slide 12: Peabody Well Positioned to Serve High-Growth Markets
Peabody Well Positioned to Serve High-Growth Markets
Slide 13: Current Seaborne Market Fundamentals Remain Strong
13 Current Seaborne Market Fundamentals Remain Strong China Electricity generation up 14% YTD Steel production up 10% YTD Coal import increases for four consecutive months; June imports up 14% YOY Government encouraging imports, considering VAT tax removal India Electricity generation up 8% YTD Ther
Slide 14: Seaborne Coal Pricing Trending Upward
Seaborne Coal Pricing Trending Upward 14 Newcastle Thermal Coal Source: Third party pricing data as of August 2, 2011. Unpriced positions as of July 19, 2011 earnings release. Pricing shown in dollars per metric ton. Benchmark Met Coal Prices Unpriced Position 2011: 2 - 3 million tons 2012 and beyon
Slide 15: U.S. Coal Demand Likely to See Modest Rebound in 2011
U.S. Coal Demand Likely to See Modest Rebound in 2011 Opportunities: Increasing coal exports out of East, West and Gulf coasts Summer stockpile draws higher than average Challenges: Muted GDP growth ~10 MT added coal-to-gas switching affecting CAPP Coal plants still running below historical capacity
Slide 16: BTU Targeting Multiple Growth Projects
BTU Targeting Multiple Growth Projects
Slide 17: Peabody Energy: Multiple Growth Catalysts to Serve Asian Demand
Country Country Project Pipeline Australia Organic expansion and acquisition opportunities China Multiple joint venture initiatives Indonesia Long-term sourcing agreements India Evaluating strategic ventures Mongolia Exploration and joint venture initiatives United States Mine expansions and export
Slide 18: Peabody Expanding Australia Production to Serve Rising Demand
Peabody Expanding Australia Production to Serve Rising Demand 18 ~8.0 15.0 - 17.0 12.0 - 15.0 27.0 35.0 - 40.0 Tons in Millions Actual results may differ from forecast. Statement on forward-looking information detailed on slide 2. 8.3 Australia Platform Grows to 35 - 40 Million Tons Per Year by 2014
Slide 19: Peabody's Australian Growth Projects Target Exports
Project S/U Quality Add'l Volume First Coal Full Production Metallurgical Coal Projects Metallurgical Coal Projects Metallurgical Coal Projects Metallurgical Coal Projects Metallurgical Coal Projects Metallurgical Coal Projects Burton S HCC 1 - 2 Late 2012 2014 Metropolitan U HCC 1 Late 2013 2014 -
Slide 20: Peabody Advancing Offer to Buy Macarthur Coal in Australia
Peabody Advancing Offer to Buy Macarthur Coal in Australia 20 World's Largest Seaborne Low-Vol PCI Producer Peabody and ArcelorMittal launch 60/40 joint venture to purchase Macarthur Coal (ASX: MCC) Offer of A$15.50 per share plus dividend of up to A$0.16 per share Takeover requires 50.01% Joint ven
Slide 21: Pursuing Development of Xinjiang Mine and Tavan Tolgoi
Pursuing development of 50 million ton-per-year mine in Xinjiang Province Xinjiang: May be world's fastest growing coal region 100 million tons of production in 2010; may reach 1 billion tons per year by ~2025 Government supportive Committed to accelerate coal reserve allocations Urumqi Ulan Baataar
Slide 22: BTU Advancing Multiple Projects in U.S.
BTU Advancing Multiple Projects in U.S. Bear Run Growing to ~8 MT in 2012 Wild Boar In production, rising to ~2 MT in 2011 Gateway North Expanding ~40% to 4.5 MT in several years El Segundo Adding 1+ MT in 2011 PRB Adding ultra-class trucks; Modest volume growth in 2011 West Coast Exports Developing
Slide 23: Peabody Secures Major Long-Term Agreement for PRB Exports to Asia
Peabody Secures Major Long-Term Agreement for PRB Exports to Asia Seaborne subbituminous volumes expected to rise 75% by 2015 Peabody access: Up to 24 MTPY Ultimate port capacity of 48 MTPY of coal; 54 MTPY of all commodities Permitting under way by SSA for deep-draft site in Cherry Point, Wash. Est
Slide 24: Major Pipeline of Growth Projects
China GreenGen Mongolia Initiatives Wambo UG Exp. Wambo O/C Exp. New PRB Leases NARM Conveyor Indonesia Sourcing Denham/ Goonyella Corridor School Creek Sage Creek Millennium Expansion Burton Expansion Wilpinjong Prep Jakarta Beijing Twentymile Prep NARM Blending Facility Gateway North United States
Slide 25: BTU: Significant Upside to Shareholder Value
BTU: Significant Upside to Shareholder Value A return to historical multiples represents significant upside Valuation growth driven by: Global expansion High-quality asset base Earnings leverage to rising seaborne prices Strong track record Current valuation ignores supercycle and prices BTU at late
Slide 26: 6th Annual Jefferies Global Industrial and A&D Conference
6th Annual Jefferies Global Industrial and A&D Conference Vic Svec Senior Vice President Investor Relations & Corporate Communications August 10, 2011
Peabody Energy — 6th Annual Jefferies Global Industrial and A&D Conference (August 2011) on 6ix