Slide 1: Ramaco Resources 2nd Quarter 2022 Investor Presentation
August 2022 Ramaco Resources 2nd Quarter 2022 Investor Presentation
Slide 2: Disclaimer
Disclaimer Forward Looking Statements: The information in this presentation includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)
Slide 3: Key Investment Highlights
KY RAMACO RESOURCES Key Investment Highlights 2
Slide 4: Ramaco overview
Ramaco overview Ramaco is a low-cost, “pure play” metallurgical coal company. We are a key supplier to the North American and international steel industry. Historically, we have sold almost no coal to power plants, though most of our coal can be used by utilities to help ease current global power sh
Slide 5: Investment highlights
Investment highlights Ramaco has built a low-cost met coal platform, with minimal AROs, net debt and legacy liabilities, a meaningful dividend, and one of the strongest growth pipelines in the industry. We generated record 2021 Adjusted EBITDA and net income and easily topped that figure in the firs
Slide 6: 1H22 financial highlights
1H22 financial highlights • Net income was $75 million (diluted EPS of $1.66) and Adjusted EBITDA was $122 million for the first half of 2022. Net income and Adjusted EBITDA were 88% and 56% higher than our full-year 2021 respective results. Key Metrics Change 2Q Change Change 2Q22 1Q22 Vs.1Q 2Q21 Y
Slide 7: Medium-term potential to roughly triple production
Medium-term potential to roughly triple production Ramaco annual production (in millions of tons) 6.5 The Company now anticipates reaching its long-term goal of achieving over 4 million tons of production for the full-year 2023. 5.5 Furthermore, the Company anticipates growing production to almo
Slide 8: Clear path to getting to ~6.5 mtpa of production
Clear path to getting to ~6.5 mtpa of production • We are now anticipating reaching 6.5 million tons of production by 2025, up from 5.0 million tons previously. We are increasing our 2022 growth capital expectation by $25 million, which is on top of the $45 million in 2022 growth capital that we had
Slide 9: Low cash costs; Meaningful 2022 production growth
Low cash costs; Meaningful 2022 production growth Met coal cash costs ($/short ton FOB mine) (1) $110 $100 We managed to keep our costs $90 among the industry’s lowest in 2021. $80 Despite industry-wide inflationary $70 pressures, such as higher sales- $60 related costs, we are committed to $50 st
Slide 10: Ramaco has an extremely strong balance sheet
Ramaco has an extremely strong balance sheet Adjusted Net Debt (Cash) / EBITDA (1) 1.5x Ramaco is in the strong position of 1.0x having a conservative balance sheet, with 0.3x Adjusted net debt to 0.5x EBITDA(1). 0.0x (0.5x) Management is committed to Peer 1 Peer 2 Ramaco Peer 3 Peer 4 Peer 5 Pe
Slide 11: Operations + Met Coal Market Overview
Operations + Met Coal Market Overview 10
Slide 12: Met coal asset portfolio with competitive advantages
Met coal asset portfolio with competitive advantages Central Appalachian operations Elk Creek Berwind Knox Creek ─ 20+ year reserve life in relatively thick coal ─ 20+ year reserve life in relatively thick ─ Production at Mid Vol Big Creek mine seams at deep mines and attractive ratios at coal
Slide 13: Metallurgical quality breakdown
Metallurgical quality breakdown Growth is focused to create a long-term, high value portfolio with almost 80% of 2025 production expected to be higher quality Low Vol., Mid Vol., and High Vol. A coal. 2022 Production Outlook (1) 2025 Production Outlook (1) Thermal Semi-Soft Thermal Mid-Vol Low-Vol 1
Slide 14: U.S. met coal spot prices up >20% from this time last year
U.S. met coal spot prices up >20% from this time last year U.S. Met Coal Spot Price (1) As of August 4, 2022, U.S. High Vol $500 A met coal spot prices are $245 per $400 metric ton FOB port, up >20% YoY. This is despite the recent pullback $300 on the back of global economic $200 concerns, in part
Slide 15: Domestic steel market remains well above historical averages
Domestic steel market remains well above historical averages U.S. Steel Prices (1) $2,500 As of August 4, 2022, despite a recent decline from peak levels, U.S. $2,000 hot rolled steel prices have fallen $1,500 over 40% since the beginning of the year, largely on the back of global $1,000 economic
Slide 16: Supply rationalization accelerates
Supply rationalization accelerates Supply underinvestment and lack of funding continues, and is likely to get worse: Met coal capex is estimated to have fallen over 75% below peak 2012 levels in 2021. Overall global mining capex is estimated to have fallen Global Met Coal Capex (1) almost 60% belo
Slide 17: Safety, Environmental, and ESG Commitment
Safety, Environmental, and ESG Commitment 16
Slide 18: Strong ESG commitment
Strong ESG commitment ESG principles are core to our strategy. Almost all of our coal last year was ultimately used to produce primary steel, which is a crucial component of the 2021 bipartisan Infrastructure Bill, including the large-scale production of energy transition windmills and modern electr
Slide 19: Environmental, Health & Safety
Environmental, Health & Safety • 2021 was the company’s safest year on record. • Ramaco is committed to complying with both regulatory as well as its own high standards for environmental and employee health and safety requirements. Ramaco believes that all accidents and occupational 2021 was Ramaco’
Slide 20: Appendix
KY RAMACO RESOURCES Appendix 19
Slide 21: 2022 Guidance
2022 Guidance (In thousands, except per ton amounts and percentages) 2022 Guidance 2021 Company Production (tons) Elk Creek Mining Complex 2,050 - 2,150 1,981 Berwind Mining Complex 500 - 600 181 Knox Creek Mining Complex (a) 250 - 350 62 Total 2,800 - 3,100 2,224 Sales Mix (b) Metallurgical 2,450 -
Slide 22: Reconciliation of non-GAAP measures
Reconciliation of non-GAAP measures Adjusted EBITDA is used as a supplemental non-GAAP financial measure by management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies. We believe Adjusted EBITDA is useful because it allows us to more
Slide 23: Ramaco Resources, Inc.
Ramaco Resources, Inc. 250 West Main Street, Suite 1800 Lexington, Kentucky 40507 INVESTOR RELATIONS: info@ramacocoal.com 859-244-7455