Suncoke Energy, Inc. · NYSE:SXC
Suncoke Energy — J.P. Morgan Global High Yield & Leveraged Finance Conference 2012
31 slides from Suncoke Energy's conference presentation, Feb 28, 2012
Slide 1: J.P. Morgan Global High Yield & Leveraged Finance Conference
J.P. Morgan Global High Yield & Leveraged Finance Conference February 28, 2012 Exhibit 99.1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Some of the information included in this presentation contains “forward-looking statements” (as defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended). Such forward-looking statements are based on man
Slide 3: SunCoke Introduction
SunCoke Introduction • Revenue of $1.5 billion • Adjusted EBITDA 2011 Adjusted EBITDA (1) (excluding Corporate Segment) (1) For a definition of Adjusted EBITDA, please see the appendix. Largest independent producer of metallurgical coke in the Americas with nearly 50 years experience ~85% of Adjuste
Slide 4: The Leading Independent Cokemaker
The Leading Independent Cokemaker 5.9 million tons of capacity with new Middletown, Ohio facility – Six cokemaking facilities; five in U.S. and one in Brazil – More than doubled capacity since 2005 Proven ability to permit, develop, construct and start up new facilities and work internationally Indu
Slide 5: 2011 Overview
$227 $141 2011 Overview 2011 Net Income (1) of $60.6 million, EPS of $0.87, and Adjusted EBITDA (2) of $140.5 million ($ in millions) (1) Attributable to shareholders (2) For a definition of Adjusted EBITDA and reconciliation of Adjusted EBITDA to net income and operating income, please see the appe
Slide 6: Cash Flow Update
Cash Flow Update Summary Cash Flow ($ in millions, except where indicated) For Year Ended December 31, 2011 For Year Ended December 31, 2010 • Working capital change reflects higher coal and coke inventory in • Expect to decline in first half 2012 • Solid year end liquidity position with $128 millio
Slide 7: SunCoke's Value Proposition
Provide an assured supply of coke to steelmakers Larger, stronger coke for improved blast furnace performance Demonstrated sustained 30% turndown; higher turndown on temporary basis High quality coke with cheaper coal blends – Burn loss vs. by-product Capital preservation and lower capacity cost per
Slide 8: SunCoke's Heat Recovery Oven vs. By-Product Oven
SunCoke’s Heat Recovery Oven vs. By-Product Oven SunCoke’s technology is the industry’s environmental standard and provides many advantages over the traditional cokemaking process
Slide 9: SunCoke's Contract Proposition
SunCoke’s Contract Proposition Plant Production and Environmental Compliance Permits and Approvals Engineering, Procurement & Construction Capital Funding and Ownership Reliable, High-Quality Coke Supply Deliver coke to customers through a competitive turnkey solution, which produces a consistent st
Slide 10: Focused Growth Strategy
Focused Growth Strategy Expand domestic coal production from current reserves and improve efficiency of existing mines We believe SunCoke Energy is uniquely positioned for continued investment and earnings growth Continue to grow our cokemaking businesses in the U.S. and Canada; reserving portion of
Slide 11: SunCoke's U.S. and Canada Market Position: Coke Imports
SunCoke's U.S. and Canada Market Position North American Coke Imports SunCoke believes it has the opportunity to displace higher cost coke imports (Tons in millions) Source: CRU, The Annual Outlook for Metallurgical Coke 2011. (1) Represents SunCoke’s domestic cokemaking capacity weighted by the num
Slide 12: SunCoke's U.S. and Canada Market Position: Pricing vs. Chinese Imports
SunCoke's U.S. and Canada Market Position SunCoke Domestic Coke pricing is competitive versus Chinese imports in the event the 40% tariff on exports is reduced or removed Source: CRU, The Annual Outlook for Metallurgical Coke 2011 ; Company estimates. (1) Chinese coke production costs net of by-prod
Slide 13: SunCoke's U.S. and Canada Market Position: Replacing Aging Batteries
SunCoke’s U.S. and Canada Market Position Replace aging coke batteries operated by integrated steel producers Integrated Steel Producers 60% SunCoke 18% DTE 5% Other Merchant & Foundry 7% Imports 10% U.S. & Canada Coke Supply Source: CRU, The Annual Outlook for Metallurgical Coke 2011. Source: CRU,
Slide 14: Coke Rate and Blast Furnace Coke Demand
Ee) 50 40 a0 20 wo 51 2010 Coke Rate 48 Bae bait st eh 2015E Coke Rat 2 800 Ibsithm 20 2 19 vow «2» 9 ww 2006 2007 2008 2009-2010 20LLE 2012 20:3 2014 2015E Blast “urnece Coke Demand ~——=BF/BOF Crude Steel Production
Slide 15: India Steel Opportunity
x SunCoke Energy 5 $60 a 3 $50 § $40 & 539. (72 Pa Russia 2020 8 $20 ep arazil 2020 $10 201°" rani 2010 $0 india 2010 2 500 1,000 1,500 Population in millions | nen EE EEEnE EEE SDEEEEEEEEEEEENEEE | ee | all
Slide 16: India Opportunity for SunCoke
India Opportunity for SunCoke
Slide 17: Why is China Important?
Why is China Important? Rest of World 48% China 45% 2011E World Steel Production Rest of World 35% China 62% 2011E World Coke Production 7% 3% Source: CRU, The Annual Outlook for Metallurgical Coke 2011 ; Company estimates. U.S. & Canada U.S. & Canada • Chinese steel market represents 45% of world p
Slide 18: Projected 2012 Coal Production
Projected 2012 Coal Production Planned Growth Current Operations Underground Mining Surface Mining Selective Reserve Additions Coal Expansion 0.35 million tons expected surface mining 1.15 million tons expected production from Jewell underground mines 0.30 million tons HKCC acquisition Projected 1.8
Slide 19: 2012 Priorities
2012 Priorities • Execute the ramp up of Middletown; expect to reach full production levels in Q2 2012 • Achieve targeted coke production volumes of 4.0 to 4.2 million tons • Continue permitting work for potential new U.S. plant in anticipation of a market recovery • Implement India entry strategy •
Slide 20: Coal Expansion and Pricing
Coal prices offer attractive growth and return on capital in our coal mining business 2012 Estimates MV (2) HV Thermal Total Coal Expansion SunCoke’s Mid-Vol. Coal Contract Prices $130 $165 2012E $170 - $190 Sales Tons (1) 1,550k 150k 150k 1,850k % Committed 88% 27% 40% 79% Price of Committed Tons (
Slide 21: 2012 Adjusted EBITDA Outlook
$141 $74 - $84 $25 - $40 $10 - $15 $250 - $280 $250 - $280 2012 Adjusted EBITDA (1) Outlook Estimated 2012 Adjusted EBITDA (1) projected to increase by $109 million to $139 million over 2011; expect 80% - 85% of 2012 Adjusted EBITDA (1, 2) to be generated by cokemaking business Adj. EBITDA Coke Coal
Slide 22: 2012 Outlook Summary
2012 Outlook Summary Metric Expected 2012 Outlook Adjusted EBITDA (1) $250 million – $280 million Capital Expenditures & Investments Approximately $150 million Free Cash Flow (2) $50 million + Cash Tax Rate 10% – 15% Effective Tax Rate 20% – 24% Corporate Costs $30 million - $35 million Coke Product
Slide 23: Leverage Ratios
Leverage Ratios $ in millions 2011 Estimated 2012 (1) Total Debt $726 $723 Total Debt / Adj. EBITDA (2) 5.1x 2.7x Net Debt (3) $598 $545 Net Debt / Adj. EBITDA (2) 4.2x 2.1x (1) Estimated ratios using mid-point of estimated Adjusted EBITDA guidance range of $250 million to $280 million. (2) For a de
Slide 24: Strategy for Shareholder Value Creation
Strategy for Shareholder Value Creation
Slide 25: Appendix
*% SunCoke Energy Appendix IP. Morgan Global High Yield & | everaged Financ Conference 24
Slide 26: Definitions
Definitions Adjusted EBITDA represents earnings before interest, taxes, depreciation, depletion and amortization (“EBITDA”) adjusted for sales discounts and the deduction of income attributable to non-controlling interests in our Indiana Harbor cokemaking operations. EBITDA reflects sales discounts
Slide 27: 2012E Net Income to Adjusted EBITDA Reconciliation
x Estimated EBIT SMM SunCoke Energy 2012E Net Income to Adjusted EBITDA Reconciliation 2012 Low Net Income $98 Depreciation, Depletion and Amortization 74 Total financing costs, net 48 Income tax expense (benefit) 25 EBITDA $245 Sales discounts 14 Noncontrolling interests (6) Adjusted EBITDA $250 J.
Slide 28: 2012E Estimated Free Cash Flow Reconciliation
timated Free Cash Flow Reco 2012E Estimated Free Cash Flow Reconciliation Cash from (i) operations; (ii) less investing; (iii) less payments to minority interest Free Cash Flow Inexcessof $ 50 J.P. Morgan Global High Yiekd & Leveraged Finance Conference 27
Slide 29: EBITDA Reconciliation 2011
x EBITDA Reconciliation SunCoke Energy For The Year Ended 2011 Jewell Other Intemational Coal-—Corporate Coke Domestic Coke Mining and Other Net Income $589 |Add: Depreciation, depletion and amortization 584 subtract: Interest Income (Primary fom affiliates) (29) lad: Interest cost—iiate 35 subtract
Slide 30: EBITDA Reconciliation, $MM
EBITDA Reconciliation, $MM For The Year Ended 2010
Slide 31: SunCoke Energy
od SunCoke Energy Media releases and SEC filings are available on our website at www.suncoke.com Contact Investor Relations for more information: 630-824-1907 <P. Mergan Global Iligh Yield & Leveraged Finance Conference 30
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