Whitehaven Coal Limited · ASX:WHC
Whitehaven Coal — FY2013 Earnings Presentation
31 slides from Whitehaven Coal's earnings presentation, Aug 27, 2013
Slide 1: Full Year 2013 Results
Whitehaven Coal Limited Full Year 2013 Results Sydney, Australia 27 August 2013
Slide 2: Disclaimer
Disclaimer Statements contained in this material, particularly those regarding the possible or assumed future performance, costs, dividends, returns, production levels or rates, prices, reserves, potential growth of Whitehaven Coal Limited, industry growth or other trend projections and any estimate
Slide 3: 2013 Full Year Results
2013 Full Year Results Financials Operations & Safety Corporate Development Maules Creek Outlook Full Year 2013 Results 3
Slide 4: FY 2013 financial highlights
FY 2013 financial highlights Net loss after tax (NLAT) of $82.2 million Underlying NLAT (excluding Significant Items) of $60.7 million Underlying EBITDA of $18.6 million Cash outflow from operations of $16.2 million Net cash outflow of $403.1 million largely driven from the acquisition of Coalworks
Slide 5: FY 2013 profitability
FY 2013 profitability Reported Financial Performance - A$ millions FY 2013 FY 2012 Revenue 622.2 618.1 NPAT/(Loss) before Significant Items (60.7) 57.8 NPAT/(Loss) (82.2) 62.5 Earnings per share (cents per share - diluted) (8.4) 10.9 Final dividend (cents per share - fully franked) - 3.0 Underlying
Slide 6: FY 2013 cash cost – tale of two halves
FY 2013 cash cost – tale of two halves H1 H2 FY 2013 FY2013 FY 2013 The combined business experienced higher first half costs from pit layout changes around Tarrawonga and mine Coal Sales (equity basis, excl. '000t 2,639 3,355(3) 5,994 scheduling issues at Werris Creek and purchased coal) Rocglen. A
Slide 7: FY 2013 cash flow
FY 2013 cash flow A$ millions FY 2013 FY 2012 EBITDA from own coal sales 15.2 148.5 Cash impact of significant items in operating cashflows (4.9) (34.4) Movement in working capital (1) (26.5) (111.6) Cash used in operations (16.2) 2.5 Cash paid in respect of transaction costs (3.5) (57.5) Interest a
Slide 8: FY 2013 balance sheet – ready for Maules Creek
FY 2013 balance sheet – ready for Maules Creek A$ millions June 30 - 2013 June 30 - 2012 Cash 110.5 513.6 Current receivables 87.3 70.2 Other current assets 155.8 158.3 Current assets 353.6 742.1 Non-current receivables 37.8 15.5 Other non-current assets 3,790.4 3,585.7 Total assets 4,181.8 4,343.3
Slide 9: FY 2013 capex
FY 2013 capex Capital Investment - $ million 2013 2012 Tarrawonga 1 4.4 1.6 Werris Creek 44.1 9.4 Rocglen 1.1 0.9 Sunnyside 0.2 0.3 Gunnedah CHPP 2.3 2.8 Total Open-cuts 1 52.1 15.0 Narrabri (including capitalised development costs) 1 134.3 181.3 Maules Creek 1 61.4 20.2 New coal train - - Vickery 7
Slide 10: Hedging status
Hedging status Whitehaven has a total FX fixed position of US$67.5m at an average exchange rate of 0.9725 US$:A$ as at 30 June 2013 Post 30 June 2013, additional hedging has been undertaken to cover fixed price - fixed volume sales contracts that have been completed FY2014 FY2014 TOTAL 1H 2H '000t U
Slide 11: FY 2013 operating highlights
FY 2013 operating highlights Improved safety and environmental performance at Whitehaven's operations Record ROM production rates from the existing open-cuts of 5.4 Mt Continued focus on Werris Creek ramp-up to 2.5 Mt Cost reductions in place at Tarrawonga, Rocglen & Werris Creek following detailed
Slide 12: FY 2013 safety performance
FY 2013 - safety performance Increased focus on safety across the operations is starting to produce positive results The TRIFR and LTIFR for Whitehaven in FY 2013 fell below the NSW coal industry averages for FY 2012 of 19.54 and 5.25 respectively The performance at Narrabri is extremely pleasing fo
Slide 13: FY 2013 coal sales – new record
FY 2013 coal sales – new record Equity Basis – 000t FY 2013 FY 2012 Change Gunnedah Operations 3,583 3,865 -7% Werris Creek 1,510 1,407 7% Narrabri 2,330 261 794% Whitehaven Total 7,423 5,532 34% 100% Basis – 000t FY 2013 FY 2012 Change Gunnedah Operations 4,078 4,361 -6% Werris Creek 1,510 1,407 7%
Slide 14: FY 2013 saleable coal production
FY 2013 - saleable coal production Equity Basis – 000t FY 2013 FY 2012 Change Gunnedah Operations 2,656 2,662 0% Werris Creek 1,547 1,343 15% Narrabri 2,426 270 799% Whitehaven Total 6,630 4,275 55% 100% Basis – 000t FY 2013 FY 2012 Change Gunnedah Operations 3,181 3,170 0% Werris Creek 1,547 1,343
Slide 15: FY 2013 Narrabri milestones - Tier 1 mine
FY 2013 Narrabri milestones - Tier 1 mine Oct 12 Longwall commissioned CHPP mechanical completion and commenced trials of PCI into Narrabri Saleable Coal Production Oct 12 COREX markets by Half Year (100% basis, 000's t) Sufficient mine development in advance facilitates the reduction 3000 Feb 13 in
Slide 16: Narrabri mining panel 2
Narrabri mining panel 2 Full Year 2013 Results 16
Slide 17: FY 2013 corporate development
FY 2013 corporate development Received federal approval for Maules Creek - to produce 13 Mtpa with railing of first coal expected in first quarter CY2015 Completion of the succession planning of Managing Director including the broadening of the executive team Tarrawonga project received approval fro
Slide 18: Gunnedah Basin assets
Gunnedah Basin assets (A) Maules Creek (75%) • Reserves to support ~ 30 years • Permitted & Planned : 13 Mtpa ROM • SSCC and high energy thermal (B) Narrabri (70%) • Reserves to support ~ 25 years • Permitted : 8 Mtpa ROM • Planned : 6 Mtpa ROM • PCI & low ash thermal coals (C) Tarrawonga (70%) • Re
Slide 19: Experienced team is delivering
Experienced team is delivering Paul Flynn Previously CEO & MD of the Tinkler group and prior to that was managing partner in the Sydney office for Ernst & (Managing Director) Young and a member of its Oceania executive team. Jamie Frankcombe More than 33 years’ experience in open cut and underground
Slide 20: Infrastructure positioning
Infrastructure positioning Port Capacity v Saleable Production 25,000 22 Sufficient port capacity secured for Maules 21 Creek ramp-up. 20,000 20 19 18 17 FY 2014 take-or-pay on port capacity is ~ 15 7Mt. Overall take-or-pay in FY2014 is 15,000 expected to be ~ $3/t 12 11 10,000 Whitehaven will apply
Slide 21: Maules Creek - Tier 1 open cut project
Maules Creek - Tier 1 open cut project Formal approval received in July 2013. High quality resource which can be mined at relatively low cost. Situated 17km from the main railway line 380km from the Newcastle port Well understood and attractive geological setting Multiple shallow coal seams with no
Slide 22: Maules Creek - project schedule
Maules Creek - project schedule Site Access Rail Construction CHPP Construction Box Cut First Coal to Trains 14 months to first coal railed Production to 6Mtpa ROM Production to 13Mtpa ROM CY Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2013 2014 2015 2016 Full Year 2013 Results 22
Slide 23: Outlook - production growth
Outlook - production growth Saleable Production by Mine 25,000 22 The combination of the existing 20,000 open cut mines and Narrabri is 18 expected to reach 11 Mtpa saleable production in FY2014. 15 000's tonnes 15,000 The development of Maules 11 10,000 Creek open cut mine is 8 expected to increase
Slide 24: Coal in world energy consumption
Coal in world energy consumption Coal is forecast to maintain its share (28%) of total world energy World Energy Consumption by Fuel Type consumption in the period to 2030 (Quadrillion Btu) despite strong growth from a low base 800 from other sources (renewables) 700 600 500 In absolute terms coal c
Slide 25: Coal price outlook
Coal price outlook Global Thermal Coal Market 2010 2011 2012 2013e 2014e 2015e The short term outlook for coal Global Power Generation TWhr 20,940 21,455 21,970 22,484 22,999 23,514 prices remains subdued as the YoY growth % 4% 2% 2% 2% 2% 2% markets for most coal types remains Coal-fired power (maj
Slide 26: Financial performance outlook
Financial performance outlook Narrabri to sell at least 650kt of PCI in FY 2014 All Narrabri coal production for FY2014 at Newcastle benchmark specification Opportunity exists to ramp-up of PCI component at Narrabri significantly by FY 2015 FY 2014 FOB costs expected to decline from 2H FY 2013 costs
Slide 27: Focus for FY 2014 and beyond
Focus for FY 2014 and beyond Creating the premium ASX listed independent coal company Whitehaven will focus on continuous improvement in safety and environmental performance across all of its operations Narrabri production will continue to grow and achieve 6 Mtpa ROM production run rate Mobilisation
Slide 28: Thank you
Thank you www.whitehavencoal.com.au
Slide 29: Appendices
Appendices Full Year 2013 Results 29
Slide 30: Reconciliation - NPAT to Operating EBITDA
Reconciliation - NPAT to Operating EBITDA A$ millions FY 2013 FY 2012 Movement % Net profit/(loss) for the period attributable to members (82.2) 62.5 -231% Add back: Significant items after tax (1) 21.5 (4.8) -552% Net profit/(loss) before significant items (60.7) 57.8 -205% Profit/(loss) before net
Slide 31: Significant Items
Significant Items A$ millions FY 2013 FY 2012 Included within the balances presented on the face of the Consolidated Interim Statement of Comprehensive Income: Operating Expenses: Suspension of mining activities and office closures (25.8) - Operating Expenses: Loss on coal trading for legacy contrac