29 slides from Bathurst Resources's shareholder meeting presentation, Dec 2, 2016
Slide 1: AGM Presentation
For personal use only AGM Presentation December 2016
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by and issued by Bathurst Resources Limited (“Bathurst”) to assist it in informing interested parties about the Company and its progress. It should not be considered as an offer or For personal use only invitation to subscribe for or purchase any securi
Slide 3: Overview of Bathurst Resources
Overview of Bathurst Resources Bathurst Resources is a leading domestic thermal coal producer with significant upside For personal use only opportunities in metallurgical coal Capital Structure Share Price Performance BRL Volume Traded (m) $0.15 40.0 BRL Share Price (A$) Share price (28-Nov-16) 0.06
Slide 4: FY16 Highlights
FY16 Highlights Bathurst has delivered on its FY16 strategy across operations, safety performance and financial outcomes as well as expanding via acquisition at a low point in the cycle For personal use only Ongoing training Reduced average Record production of under Health and cash cost of mining 4
Slide 5: FY16 Key Profit Metrics
FY16 Key Profit Metrics In FY16 the Company has improved on its historical performances to deliver an adjusted For personal use only EBIDTA of NZ$11.8m, an increase of 140% year on year Production Cash Costs1 500 140 Production (kt) 400 120 300 Cash Cost (NZ$/t) 100 200 100 80 Productivity 0 7,000 6
Slide 6: Metallurgical Coal Market
Metallurgical Coal Market Cautiously Optimistic For personal use only Coking Coal Price in FY2016 250 200 Coal Price (US$/t) • Current spike in spot pricing 150 inconsistent with longer 100 term consensus 50 • Bathurst planning to support - profitable and sustainable CY16 operations at the bottom of
Slide 7: Strategic Pillars
Strategic Pillars For personal use only Creating Shareholder Value Grow the South Island Entry into the North Entry into the Export Domestic thermal Island domestic market market thermal market √ √ √ • Currently a leading market • Stockton acquisition • Qualification trials on the North participant
Slide 8: Leading Presence in New Zealand
Leading Presence in New Zealand Bathurst has established itself as the preeminent coal producer in New Zealand For personal use only Rotowaro (100%)1 Buller 2 Production (FY18) 700 kt Development asset Margin NZ$25-35/t Auckland Maramarua Resource 18.6 Mt Rotowaro Reserve 2.5 Mt Stockton Buller Casc
Slide 9: Takitimu Mine & Southland Footprint
Takitimu Mine & Southland Footprint Developed mine producing thermal coal for domestic industrial use Takitimu For personal use only Production (FY16) 303 kt Resource 3.7 Mt Reserve 1.6 Mt • Well established mine with significant resources in adjacent blocks • Mining to progress North into the Black
Slide 10: Canterbury
Canterbury Provides thermal coal for domestic industrial use and in close proximity to end users For personal use only Canterbury Production (FY16) 62 kt Resource 5.3 Mt Reserve 0.2 Mt • Developing mine on track to produce 100kt in FY2017 and 150kt in FY2018 • Growing industrial coal use in the Cant
Slide 11: Buller Coal Project
Buller Coal Project High quality export metallurgical coal resource • Significant resource on the For personal use only Denniston Plateau • Cascade and Escarpment mines on care and maintenance • Review underway to assess production in current (volatile) market conditions • Future blending opportunit
Slide 12: Asset Acquisition
For personal use only Asset Acquisition
Slide 13: Background to Transaction
Background to Transaction Following the approval of Solid Energy’s DOCA in September 2015, Bathurst signalled its For personal use only intention to participate in the asset sale process in November 2015 Solid Energy Sale Process Relevant Solid Energy Asset Locations Legend • Solid Energy is the lar
Slide 14: Strategic Rationale
Strategic Rationale The combination of the Solid Energy assets acquired with Bathurst’s existing Buller For personal use only Plateau assets could unlock material synergies for the Company Strategic Rationale & Benefits Asset Location • Stockton accelerates Bathurst’s entry into the export market wi
Slide 15: Inherent Complexity
Inherent Complexity The transaction presented a number of complex issues requiring navigation For personal use only Key Issues Solutions Identified 1. Vendor requirement for funding certainty Major shareholder support 2. Challenging operating environment Experienced due diligence team 3. Transac
Slide 16: Pro Forma Bathurst Resources
Pro Forma Bathurst Resources A successful transaction will have a material impact on Bathurst’s production profile, as For personal use only well as its resource and reserve base Pro Forma Production (100%)1 Pro Forma Resources (100%)1 2,500 250 200 Resources (Mt) 150 2,000 100 50 Production (Iktpa)
Slide 17: Overview of Phoenix Coal
Overview of Phoenix Coal Bathurst Resources together with Talley’s Group have formed a joint venture, Phoenix For personal use only Coal Limited (Phoenix Coal), to acquire select North and South Island assets from Solid Energy Talley’s Group Overview Phoenix Coal Overview • Talley’s Group, establish
Slide 18: Phoenix Coal Funding Sources & Uses
Phoenix Coal Funding Sources & Uses Phoenix Coal will acquire the Rotowaro, Maramarua, and Stockton mines for an upfront For personal use only cash consideration of NZ$46m funded through equity commitments from Bathurst and Talley’s, and a bank debt facility provided by BNZ Selected Asset Considerat
Slide 19: Bathurst Resources Funding Sources & Uses
Bathurst Resources Funding Sources & Uses Bathurst will fund its ~NZ$26m equity contribution to Phoenix Coal through a For personal use only combination of RCPS, Convertible Notes, and Bond issuance Funding Instrument Overview1 Bathurst Resources Sources of Funds Sources Commitment2 • Placement of r
Slide 20: Capital Raising Pricing
Capital Raising Pricing Slippage in the process timetable coincident with a rally in the metallurgical coal price For personal use only has reduced the discount/premium to which the instruments were originally priced $0.07 220.0 28-Oct-16: Execution of SPA; Hard Coking Coal Quarterly Benchmark Price
Slide 21: Sale & Purchase Conditions
Sale & Purchase Conditions Phoenix Coal’s sale and purchase agreement is conditional on, among other things, OIO For personal use only approval. This is expected to occur between end Q1 2017 and Q2 2017 Sale & Purchase Conditions Key Process Milestones2 • Approval by the New Zealand Key Event Date O
Slide 22: Rotowaro Overview
Rotowaro Overview Rotowaro is an open cut mine located in the Waikato region of New Zealand producing a For personal use only high-quality, low-ash thermal coal for the domestic market Snapshot Location • Status: production; O/C; domestic thermal coal (high-quality low- ash) • Location: 9km West of
Slide 23: Maramarua Overview
Maramarua Overview Maramarua is an open cut mine located in the Waikato region of New Zealand producing For personal use only a low-ash thermal coal for the domestic market Snapshot Location • Status: production; O/C; thermal coal (low-ash) • Location: 45km North of Huntly, Waikato, New Zealand • Op
Slide 24: Stockton Overview
Stockton Overview Stockton is an open cut mine located on the West Coast of New Zealand producing a low- For personal use only ash metallurgical coal for export Snapshot Location • Status: Production; O/C; export metallurgical coal (low-ash) • Location: 25km North of Westport, West Coast, New Zealan
Slide 25: Appendices
For personal use only APPENDICES
Slide 26: Appendix Board of Directors
Appendix 1 Board of Directors For personal use only Toko Kapea Non-Executive Chairman Commercial lawyer and company director Richard Tacon Executive Director & CEO Over 32 years coal mining operations experience Russell Middleton Non-Executive Director Strong financial background in mining and const
Slide 27: Appendix Director Profiles
Appendix 2 Director Profiles Toko Kapea – Non-executive Chairman Toko is a Wellington based commercial lawyer, consultant and director. He is a director of Tuia Group Limited and a partner in Tuia Legal. Toko has For personal use only worked at Chapman Tripp and in legal roles in-house at Meridian E
Slide 28: Appendix Executive Management Team
Appendix 3 Executive Management Team For personal use only Jason Hungerford Alison Brown Chief Financial Officer General Counsel Fiona Bartier Craig Pilcher General Manager, General Manager, HSEC Operations 28
Slide 29: Competent Person Statements
Competent Person Statements Bathurst Resources Competent Person Statement The information on this report that relates to mineral resources for Deep Creek and the mineral reserves for Escarpment Expor t and Whareatea West is based on information compiled by For personal use only Sue Bonham-Carter who