Peabody Energy Corporation · NYSE:BTU
Peabody Energy — Credit Suisse Energy Summit 2018
27 slides from Peabody Energy's conference presentation, Feb 13, 2018
Slide 1: Credit Suisse Energy Summit
Credit Suisse Energy Summit Amy Schwetz Executive Vice President and Chief Financial Officer February 13, 2018
Slide 2: Statement on Forward-Looking Information
Statement on Forward-Looking Information This presentation contains forward-looking statements within the meaning of the securities laws. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words or variation of
Slide 3: Peabody: World's Largest Private-Sector Coal Company
Peabody: World’s Largest Private-Sector Coal Company We’re the Leading Global Pure-Play Coal Investment, and we have significant scale… high-quality assets and people… and diversity in geography and products Our Financial Approach Return Cash to Invest Shareholders Maintain Wisely Generate Financial
Slide 4: Peabody: Who We Are; Where We Operate
Peabody: Who We Are; Where We Operate 23 operations 5.6 billion $5.9 billion In U.S. and Australia Tons of Reserves 2017 Revenues ~7,100 25+ countries Employees Served by Peabody Globally Operations Note: Revenues as of Dec. 31, 2017. Operations, reserves and countries served as of Dec. 31, 2016. He
Slide 5: What We Offer as a Leading Coal Company
What We Offer as a Leading Coal Company 200 2016 Mining Tons Sold 2017 Adjusted EBITDA (in millions) by Mining Segment 180 ($ in millions) 160 U.S. Thermal 140 U.S. Met Australian Thermal PRB Asia-Pacific Met $370.5 120 $382.2 Asia-Pacific Thermal 100 80 Midwestern 60 U.S. $174.4 40 Australian Weste
Slide 6: Active Fourth Quarter Underpins Year of Substantial Achievement
Active Fourth Quarter Underpins Year of Substantial Achievement Relists on NYSE, increases share price 79% Recent 2018 Actions Increases revenues 18% from prior year Reports highest Adjusted EBITDA in 5 years Simplifies capital structure as Increases liquidity to $1.24 billion preferred shares conve
Slide 7: Mining Operations
Mining Operations Operations at Peabody’s North Antelope Rochelle Mine in Wyoming 7
Slide 8: Peabody Offers Top-Tier International Thermal Business with Substantial Margins
Peabody Offers Top-Tier International Thermal Business with Substantial Margins • Australian Thermal Australian Thermal Segment Adjusted EBITDA Margins leads company in full-year Adjusted EBITDA margins 40% 38% $100 Average Newcastle • Targeting 2018 volumes of $90 35% Thermal Pricing 11.5 – 12.5 mi
Slide 9: Australian Seaborne Metallurgical Portfolio Represents Marked Improvement
Australian Seaborne Metallurgical Portfolio Represents Marked Improvement; Further Strengthening Platform • Substantial steps taken to Improvement in Australian Metallurgical Adjusted EBITDA Margins improve platform, including: – Improved efficiencies, lower costs 40% through owner-operator conversi
Slide 10: U.S. Mining Segment Represents Significant Scale, Stable Operating Performance
U.S. Mining Segment Represents Significant Scale, Stable Operating Performance e U.S. platform delivers 2017 average margins of 25% © PRB position anchored by world’s largest coal mine — North Antelope Rochelle — PRB mining complex serves scores of customers in nearly half of states in U.S. @ Illino
Slide 11: Peabody PRB Strategy Focused on Returns
Peabody PRB Strategy Focused on Returns Operates three of four most Adjusted EBITDA Margin productive mines in U.S. of PRB Producers (2014 – 1H 2017 Avg.) 30% Produces from more than dozen pits in PRB 25% Ability 25% – to move people, equipment and contracts 21% – 20% Cost profile can vary up to $6
Slide 12: Geographic and Product Diversity Targeted to Deliver Maximum Value
Geographic and Product Diversity Targeted to Deliver Maximum Value for Shareholders Adj. EBITDA Contributions Led by 3 Different U.S. provides solid revenue Mining Segments in Past 6 Quarters visibility; Australia offers (dollars in millions) $200 substantial earnings strength during mid-to-high par
Slide 13: Industry Fundamentals
Industry Fundamentals Coal railed from Peabody’s El Segundo Mine in New Mexico 13
Slide 14: Industry Update: Seaborne Coal Pricing Remains Elevated
Industry Update: Seaborne Coal Pricing Remains Elevated on Firm Asia-Pacific Demand and Supply Tightness Seaborne Thermal Coal Seaborne Metallurgical Coal Global seaborne demand Global steel production increases 3% in 2017 rises 5% through year end over prior year Chinese met imports India demand do
Slide 15: Industry Update: U.S. 2017 PRB Generation Rises
Industry Update: U.S. 2017 PRB Generation Rises as Total Stockpiles Decline and Exports Increase Natural gas prices largest Fuel Generation Change determinant of coal demand for Full-Year 2017 10% PRB demand up 16 million 5% Total Electricity 5% Consumption tons in 2017 PRB 0% – 2017 total coal gene
Slide 16: U.S., Australia Advance Pro-Energy Economy
U.S., Australia Advance Pro-Energy Economy; Recognize Importance of Coal in Energy Mix U.S. EPA proposes repeal Previous U.S. Announcements of Clean Power Plan Perry study and proposed FERC Repeal of “Stream Protection Rule” grid resiliency pricing rule Office of Natural Resources represent first st
Slide 17: Financial Approach
Financial Approach 17
Slide 18: Peabody Exceeds Deleveraging and Liquidity Targets
Peabody Exceeds Deleveraging and Liquidity Targets; Deliberately Pursuing Financial Approach Liquidity Deleveraging Shareholder Returns Liquidity totals Completes debt Q4 repurchases $1.24 billion repayments of total $107 million at year end $500 million Executes $176 Restricted cash Benefits includ
Slide 19: BTU Continues to Deliberately Pursue Stated Financial Approach
BTU Continues to Deliberately Pursue Stated Financial Approach; Begins 2018 Focused on Core Priorities Focus on safety, productivity and margin maximization from operational platform Reduce unit costs, improve coal’s competitiveness against natural gas and take actions to preserve coal plants from p
Slide 20: Appendix
APPENDIX North Antelope Rochelle Mine Loadout Facility 20
Slide 21: A Leading Voice in Advocating for Sustainable Mining, Energy Access and Clean Coal
Peabody A Leading Voice in Advocating for Sustainable Mining, Energy Access and Clean Coal Technologies Investment Principles for Best-in-Class Coal Companies designed to provide distinguishing elements to help investment community make portfolio decisions Operate safely Sustainable Maximize resourc
Slide 22: Full-Year Adjusted EBITDA Margins Average 30% Across Mining Segments
Full-Year Adjusted EBITDA Margins Average 30% Across Mining Segments Australian thermal leads Adjusted Q4 Full Year Adjusted EBITDA margins, EBITDA Margins 2017 2017 Australian met leads in total 2017 contributions of $525 Aus. Thermal 38% 38% million Australian platform expands Aus. Met 39% 34% ave
Slide 23: Appendix: 2018 Targets
Appendix: 2018 Targets Sales Volumes (Short Tons in millions) Capital Expenditures $275 – $325 million PRB 115 - 125 ILB 18 - 19 SG&A Expense ~$150 million Western 13 - 14 Total U.S. 146 - 158 Interest Expense $143 – $153 million Aus. Metallurgical1 11.0 - 12.0 Cost Sensitivities4 Aus. Export Therma
Slide 24: Appendix: 2018 Targets
Appendix: 2018 Targets 1 Metallurgical coal sales volumes may range from approximately 55%-65% PCI and approximately 35%-45% coking coal (including semi-hard and semi-soft coking coals). Approximately 30% of seaborne coking coal sales may be priced on a spot basis, with the remainder linked to an in
Slide 25: Appendix: Reconciliation of Non-GAAP Measures
Appendix: Reconciliation of Non-GAAP Measures 2017 2016 2017 2017 2016 Successor Predecessor Successor Predecessor Combined Predecessor Quarter Ended Year Ended April 2 through January 1 through December 31 December 31 April 1 December 31 (In Millions) Tons Sold Powder River Basin Mining Operations
Slide 26: Appendix: Reconciliation of Non-GAAP Measures
Appendix: Reconciliation of Non-GAAP Measures 2017 2016 2017 2017 2016 Successor Predecessor Successor Predecessor Combined Predecessor Quarter Ended April 2 through January 1 Year Ended December 31 December 31 through April 1 December 31 (In Millions, Except Per Ton Data) Reconciliation of Non-GAAP
Slide 27: Appendix: Reconciliation of Non-GAAP Measures
Appendix: Reconciliation of Non-GAAP Measures Predecessor Year Ended December 31, 2016 2015 2014 2013 2012 Tons Sold (In Millions) Powder River Basin Mining Operations 113.1 138.8 142.6 135.2 140.3 (1) Adjusted EBITDA is a non-GAAP Midwestern U.S. Mining Operations 18.3 21.2 25.0 26.3 27.4 measure d