Peabody Energy Corporation · NYSE:BTU
Peabody Energy — Investor Day (November 2010)
34 slides from Peabody Energy's investor day presentation, Nov 9, 2010
Slide 1: Australia Analyst and Investor Tour November 10-12, 2010
1 Australia Analyst and Investor Tour November 10 - 12, 2010 Exhibit 99.1
Slide 2: Statement on Forward-Looking Information
2 2 Statement on Forward-Looking Information Some of the following information contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended, and is intended to come within the safe-harbor protec
Slide 3: Strong Results, Outstanding Outlook
3 3 2006 2007 2008 2009 2010 EBITDA 909.7 969.7 1846.9 1290.1 1850 50 Year-to-date September 2010 results: Australia EBITDA doubles to $670 million U.S. EBITDA grows 14% to $854 million Operating cash flows reach record $884 million Adjusted diluted EPS increases 48% Substantial liquidity to fund gr
Slide 4: Early Stages of Coal's Supercycle
Early Stages of Coal's Supercycle
Slide 5: Major New Global Build Out of Coal Generation Under Way
5 Major New Global Build Out of Coal Generation Under Way Source: Platts Worldwide Power Plant Database; EIA International Energy Outlook 2010 and Peabody analysis. Growth of global coal-based generation (billion kilowatt hours) based on 2007 - 2035 EIA data. Generation Demand Driven by Asia and Gro
Slide 6: Global Met Coal Use Forecast to Rise
6 6 Global Met Coal Use Forecast to Rise 400 Million Tonnes by 2015 Expected Global Steel Production And Met Coal Demand Source: World Steel Association; third party data and Peabody analysis. Global steel production expected to rise nearly two-thirds by 2020 Bulk of market share growth in China and
Slide 7: China and India Lead Long-Term Coal Demand Growth
7 7 U.S. growth presented in short tons. Source: World Energy Outlook 2009, International Energy Agency; Annual Energy Outlook Forecasts, Energy Information Administration; Peabody analysis. China and India Lead Long-Term Coal Demand Growth +690 +2,210 +150 +50 +110 +380 Developing Asia Represents 9
Slide 8: Near- and Mid-Term Pacific Markets Outstanding for Coal
Near- and Mid-Term Pacific Markets Outstanding for Coal
Slide 9: Seaborne Thermal Coal Market Short Next Five Years
9 9 Seaborne Thermal Coal Market Short Next Five Years; Implies Strong Pricing Driver 2010 2011 2012 2013 2014 2015 Atlantic 0 6 19 29 35 37 Other Pacific 0 5 17 30 50 60 China 0 2 4 6 8 13 India 0 20 40 60 80 90 Expected Increase in Seaborne Thermal Demand 2010 - 2015 India 125%-175% China 5%-25% O
Slide 10: Seaborne Met Coal Market Fundamentally Short
10 10 2015 Australia 37 Mongolia 14 Other Pacific 15 Russia 5 Seaborne Met Coal Market Fundamentally Short 2015 Brazil 20 India 14 China 15 Europe 4 South Korea 6 Japan 4 Other 2 Expected Increase in Seaborne Met Demand 2010 - 2015 Expected Increase in Seaborne Met Supply 2010 - 2015 30-40 ~10 ~10 0
Slide 11: Peabody's Catalysts for Growth & Shareholder Value Upside
Peabody's Catalysts for Growth & Shareholder Value Upside
Slide 12: Peabody Energy: Catalysts for Growth
12 12 Peabody Energy: Catalysts for Growth Bear Run Mine Expanding Production Multiple PRB Export Opportunities in Development Expanding Australia Seaborne Met, Thermal Volumes Metropolitan, Wilpinjong and Burton Construction Commenced Multiple JVs and Large Project Pipeline in China Pursuing Mongol
Slide 13: Peabody's Australia Growth Engine Key Takeaways
13 13 Peabody's Australia Growth Engine Key Takeaways Outstanding access to high-growth global markets at the early stages of long-term supercycle Well-managed portfolio of diverse operations and products delivering substantial margins, earnings and cash flows Significant growth program under way, d
Slide 14: Australian Election Produces Minority Government
Australian Election Produces Minority Government
Slide 15: Policy Transition Group Consultation Enables Industry to Influence Framework
15 Policy Transition Group Consultation Enables Industry to Influence Framework Government has published preliminary Issues Paper Industry consultation is continuing Industry has raised concerns over several departures from pre- election agreed terms Credit for State royalty increases has emerged as
Slide 16: Anticipated Timeline of MRRT Development and Implementation
16 Anticipated Timeline of MRRT Development and Implementation Tax Reform Timetable May 2, 2010 - RSPT announced July 2 - Revised Regime - MRRT announced August - Policy Transition Group formed Mid 2011 - Exposure Draft Legislation Late 2011 - Legislation Introduced Into Parliament July 2012 - Propo
Slide 17: Peabody Progresses Its Growth Plans as MRRT Discussions Continue
17 Peabody Progresses Its Growth Plans as MRRT Discussions Continue Some form of tax will likely be implemented We currently believe new tax regime will be manageable and consultation process will deliver improvements Peabody continues to move ahead on all projects Development lead time on organic g
Slide 18: Serving High Growth Asian Markets from Expanding Australia Platform
Serving High Growth Asian Markets from Expanding Australia Platform
Slide 19: Focused Growth Strategy
19 Focused Growth Strategy Export coal to Asia from Australia Expand coal trading business Build production base in China & Indonesia JVs Develop Mongolia- to-China platform World-class open cut mining expertise Proven record of environmental stewardship Culture of safety and continuous improvement
Slide 20: Diversity In Product Mix, Regions and Ports
20 Diversity In Product Mix, Regions and Ports HQHCC HCC SHCC PCI/Other 3.6 2.5 1.8 1.9 High Quality Hard 30 - 35% Hard 20 - 25% Semi- Hard 15 - 25% PCI 15 - 25% Expected 2010 Met Coal Mix Sales 2009 Quality Port Burton 2.5 M DBCT Eaglefield 0.9 M DBCT Millennium 0.8 M/P DBCT North Goonyella 1.8 M D
Slide 21: A Major Earnings Contributor
21 21 International U.S. 44 85 21 Australia A Major Earnings Contributor 1st Qtr 2nd Qtr 1 99 2003 United States International $422 Million Values represent continuing operations. International/U.S. share unaudited. International U.S. 50 50 2010 Est. $1.85 - $1.9 Billion 2009 $1.29 Billion Internati
Slide 22: Targeting Higher Australia Sales of Up to 40 MTPA by 2014
22 22 2009 2010 2014-15 Seaborne Thermal 9.6 11.5 15 0.5 2 Targeting Higher Australia Sales of Up to 40 MTPA by 2014 Tons in Millions 2009 2010 2014-15 Seaborne Met 7 9.5 12 1 3 11.5 - 12.5 15.0 - 17.0 9.6 9.5 - 10.0 12.0 - 15.0 6.9 Met Coal Sales Estimates Seaborne Thermal Coal Sales Estimates Up t
Slide 23: Significant Progress in Peabody's Australia Project Pipeline
23 23 Metropolitan 1 MT HCC, $70 million Wambo 3 - 4 MT Thermal/PCI Millennium 2 - 3 MT SHCC/PCI Sufficient Rail/Port Access to Accommodate Growth Significant Progress in Peabody's Australia Project Pipeline Short tons in millions. Dollars represent projected capital expenditures. Met Seaborne Therm
Slide 24: Australia Organic Growth Projects: Metropolitan Expansion
24 Fully permitted Expansion combined with modernization of mine Board approval granted January 2010 $70 million of expansion cap-ex Construction commenced; prep plant upgrade under way, new drift about to start Reposition mine in lowest cost quartile Mine Layout Project Description Underground mine
Slide 25: Australia Organic Growth Projects: Burton Extension
25 Australia Organic Growth Projects: Burton Extension Extending mine life via reopening of previously mined and partially reclaimed pit Enhances coal blending opportunities with other products from the Burton complex Fully permitted Development activities have begun Project Description Proposed Exp
Slide 26: Australia Organic Growth Projects: Millennium Expansion
26 Expands the capacity and life of mine Opportunity to improve efficiencies Finalizing mine plan to optimize reserves EIS for environmental approvals submitted to Queensland Government Mine Layout Australia Organic Growth Projects: Millennium Expansion Project Description Surface mine SHCC/PCI qual
Slide 27: Australia Organic Growth Projects: Denham/Goonyella Corridor
27 Project feasibility in progress Evaluating range of options: Life extension of underground operations Open-cut surface mine Construction of new prep plant module and additional surface facilities Some environmental approvals in place and others under way Project Description Potential Surface Mine
Slide 28: Australia Organic Growth Projects: Wilpinjong Expansion
28 Permitting complete Increasing production at lowest-cost quartile operation Board approval granted July 2010 $90 million of expansion capital expenditure Expanding prep plant and coal handling capacity Procurement and development initiated Project Description Surface mine Low cost seaborne therma
Slide 29: Australia Organic Growth Projects: Wambo Expansion
29 Additional 3 - 4 million tons by 2014 - 2015 from open cut mine High quality, low ash thermal and PCI coal Feasibility/Design Stage Developing/optimizing mine plans for both open cut and underground operations Exploration drilling ongoing Project Description Current Proposal Australia Organic Gro
Slide 30: Sufficient Logistics Available to Support Organic Growth Plans
30 Sufficient Logistics Available to Support Organic Growth Plans 2010 2011 2012 2013 2014 Peabody Est. 7.965 9.073 10.117 11.766 12.031 DBCT Allocation 8.287 8.753 10.504 11.554 12.125 Peabody's Potential Sales vs. Allocation 2010 - 2014 Expected Logistic Chain Allocation Meets/Exceeds Planned Sale
Slide 31: Assessing Additional Growth Projects
31 31 Assessing additional expansions, extensions at existing operations including Burton North and Wilkie Creek Active exploration drilling programs under way Surat Basin Bowen Basin Assessing Additional Growth Projects Active Exploration Within Current Resource Base
Slide 32: Peabody Rapidly Expanding Exploration Efforts
32 Peabody Rapidly Expanding Exploration Efforts Mongolia Mozambique China Indonesia Australia Source: Energy Information Administration International Energy Outlook 2010 and Peabody analysis. Major Undeveloped Met and Thermal Reserves Ramping up exploration program to capture full value chain econo
Slide 33: Peabody's Australia Portfolio Offers Multiple Advantages
33 Optimal location to serve Asian demand Premium met and thermal coal products Expanding export capability with rail/port access Significant organic growth program under way Additional growth prospects via exploration, potential M&A Peabody's Australia Portfolio Offers Multiple Advantages
Slide 34: Australia Analyst and Investor Tour November 10-12, 2010
34 Australia Analyst and Investor Tour November 10 - 12, 2010