Coal FactBook -Mar2013.pdf

8/14/2019 Coal FactBook -Mar2013.pdf

http://slidepdf.com/reader/full/coal-factbook-mar2013pdf 1/15

Conference Edition 2013Conference Edition 2013Conference Edition 2013Conference Edition 2013

Holly StewartHolly StewartHolly StewartHolly Stewart

(713) 393(713) 393(713) 393(713) [email protected]@[email protected]@howardweil.com



H O W A R D W E I L | 2013 Energy Conference 2

Alphabetical by CompanyArch Coal, Inc. (ACI) .............................................. 3

Alpha Natural Resources (ANR) ............................ 4

Cloud Peak Energy (CLX) ...................................... 5

CONSOL Energy Inc. (CNX) ................................. 6Peabody Energy Corporation (BTU) .................... 7

Company Statistics

Trading Valuation / Free Cash Flow ...................... 9

Production / Contracted Volumes ........................ 10

Production Matrix ................................................. 11

Performance Summary ........................................ 12

Market Stats / Valuation ....................................... 13

Basic Definitions .................................................... 14

Table of Contents




Ticker ACIPrice ($/sh, as of 3/13/13) $5.1452-week high ($/sh) $12.75

52-week low ($/sh) $4.89Market Cap ($mm) $1,090Enterprise Value ($mm) $5,424

Shares Out (mm) 212Net debt ($mm) $4,334Net debt-to-cap 60%

Management

John W. Eaves, President and CEOPaul A. Lang, COO

John T. Drexler, CFO

Investor Relations ContactJennifer Beatty 314-994-2781

Short-term Debt $33

Long-term Debt $5,086

Shareholder Equity $2,855

LT Debt / Capital 64%

Total Debt / Capital 64%

Net Debt / Capital 60%

Cash $785

Revolver Capacity $600

Available Capacity $333

COMPANY PROFILE

Picture Source: Arch Coal

PERFORMANCE & CAPEX BREAKDOWN

CAPITAL BREAKDOWN

Surface vs. Underground Production by Region Metallurgical vs. Steam

PRODUCTION BREAKDOWN (2012A)

Arch Coal Inc

OPERATING DETAIL

as of 12/31/12 ($mm)

www.archcoal.com

Arch Coal sold approximately 141 mm tons of coal in 2012, representing ~14% of the nation's coal supply. Archoperates or contracts out the operation of 32 active mines in four different regions: the Powder River Basin, WesternBituminous, Central Appalachia and Illinois Basin. With 2.2 b tons of recovered reserves, Arch supplies coal to bothdomestic utilities and domestic and international steel producers.

Surface79%

Underground21%

PRB74%

Western Bit11%

East13%

ILB2%

Steam95%

Met5%

2011A 2012A 2013E

Total Expenditures $541 $395 $355 % Change 72% -27% -10%

Capital Expenditures ($mm)

2012A 2013E 2014E 2015E

EPSE ($0.38) ($1.22) ($0.28) $0.13

% Change -135% -221% 77% 148%

Consensus ($1.15) ($0.43) ($0.11)

EBITDA $3.16 $2.29 $3.71 $4.00

% Change -35% -27% 62% 8%CFPSE $1.57 $1.31 $2.15 $2.39

% Change -53% -17% 63% 11%

Trading metrics

P/E nm nm nm 38.7 x

EV/EBITDA 8.1 x 11.1 x 6.8 x 6.2 x

P/CF 3.3 x 3.9 x 2.4 x 2.2 x

Source: Howard Weil & Arch Coal

ACI Financial Snapshot

2012A 2013E 2014E 2015E

Production (mm)

PRB 104.4 101.3 106.3 117.0

Western Bit 15.6 15.8 16.2 16.8

Eastern - Thermal 11.1 8.9 8.7 8.4

Eastern - Met 7.5 8.5 9.3 11.2

Total Tons Sold 138.6 134.5 140.5 153.4

% Change -10% -3% 4% 9%

Contract Detail

Percent Contracted- Met 96% 46% 0% 0%

Percent Contracted- Thermal 93% 75% 42% 0%

Pricing Detail (per ton)

PRB Realized Price $13.61 $12.91 $12.83 $12.98

Western Bit Realized Price $35.67 $39.34 $54.68 $44.00

Eastern Thermal Realized Price $64.73 $62.84 $71.00

Eastern Met Realized Price $113.00 $87.49 $98.13 $109.73

Overall Realized Price $25.90 $23.77 $25.99 $26.25

Costs Detail (per ton) Avg Operation Cost $20.49 $20.06 $20.37 $20.63

SG&A $0.95 $0.94 $0.96 $0.98 DD&A $3.73 $3.66 $3.39 $3.10

Gross Op Margin 21% 16% 22% 21%

Operating Stats






http://slidepdf.com/reader/full/coal-factbook-mar2013pdf 6/15 H O W A R D W E I L | 2013 Energy Conference 6

Ticker CNX

Price ($/sh, as of 3/13/13) $32.4452-week high ($/sh) $37.3952-week low ($/sh) $26.41Market Cap ($mm) $7,459Enterpri se Value ($mm) $10,650Shares Out (mm) 230Net debt ($mm) $3,191Net debt-to-cap 45%

Management

J. Brett Harvey, Chairman and CEONicholas J. DeIuliis, President

David M. Khani, CFO Investor Relations Contact

Dan Zajdel 724-485-4169

Tyler Lewis 724-485-3157

Short-term Debt $39

Long-term Debt $3,175

Shareholder Equity $3,954

LT Debt / Capital 45%

Total Debt / Capital 45%

Net Debt / Capital 45%

Cash $22

Revolver Capacity $2,500

Available Capacity $2,329

COMPANY PROFILE

Picture Source: CONSOL Energy

Metallurgical vs. Steam

PRODUCTION BREAKDOWN (2012A)

Production by Region

OPERATING DETAIL PERFORMANCE & CAPEX BREAKDOWN

CONSOL Energy Inc

as of 12/31/12 ($mm)Surface vs. Underground

CAPITAL BREAKDOWN

www.consolenergy.com

Underground96%

Surface4%

CONSOL Energy is an integrated energy company, with reserves both in coal and natural gas. CONSOL had 4.2 btons of proven and probable coal reserves at the end of 2012. The Company produced 56 mm tons of coal in '12 from11 U.S. mining complexes, of which 13% was met production. CNX also has 4 tcf of natural gas reserves, all in the Appalachian region, and produced 156 net Bcfe in 2012, 36.5 bcfe in the Marcellus Shale.

CAPP13%

NAPP87%

Steam87%

Met13%

2011A 2012A 2013E

Coal Operations $558 $1,043 $465

Gas Operations $662 $533 $885

Total $1,220 $1,575 $1,350

% Change 6% 29% -14%

Capital Expenditures ($mm)

2012A 2013E 2014E 2015E

EPSE $1.11 $0.76 $1.49 $2.37

% Change -60% -31% 96% 59%

Consensus $1.05 $2.17 $2.38

EBITDA $4.99 $4.75 $5.94 $7.31

% Change -31% -5% 25% 23%CFPSE $3.18 $3.50 $4.46 $5.57

% Change -52% 10% 27% 25%

Trading metrics

P/E 29.3 x 42.6 x 21.7 x 13.7 x

EV/EBITDA 9.3 x 9.7 x 7.7 x 6.3 x

P/CF 10.2 x 9.3 x 7.3 x 5.8 x

Source: Howard Weil & CONSOL

CNX Financial Snapshot2012A 2013E 2014E 2015E

Production (mm tons)

NAPP - Thermal 45.7 46.8 49.7 51.1

NAPP - Met 3.6 2.8 3.3 3.9

Total NAPP 49.3 49.7 52.9 55.0

CAPP - Thermal 3.4 0.9 0.8 0.8 CAPP - Met 3.7 4.1 4.5 4.9

Total CAPP 7.1 4.9 5.3 5.7

Total Production 56.4 54.6 58.2 60.8

% change -10% -3% 7% 4%

Contract Detail

Percent Contracted - Met 48% 4% 0% 0%

Percent Cont rac ted - Thermal 100% 98% 45% 27%

Pricing Detail (per ton)

Thermal Realized Price $61.99 $59.11 $63.83 $66.24

Met Realized Price $102.46 $100.67 $115.46 $123.68

Overall Realized Price $69.10 $63.58 $66.96 $72.03

Costs Detail (per ton)

Avg Operating Cost $32.69 $33.46 $34.06 $34.96 SG&A $2.63 $2.53 $2.56 $2.59

DD&A $6.42 $6.59 $6.82 $7.06

Gross Op Margin 30% 22% 25% 29%

Operating Stats









Trading Valuation...Current vs. Historical

Free Cash Flow

Companies P/E P/CF EV/EBITDA P/E P/CF EV/EBITDA

ACI 13.6x 5.8x 7.7x nm 2.4x 6.8x

ANR 14.5x 6.3x 5.6x nm 2.6x 4.9x

BTU 15.1x 7.9x 9.3x 10.4x 4.4x 6.2x

CLD* 11.0x 4.6x 4.8x 11.9x 5.3x 4.9x

CNX 15.3x 8.6x 7.2x 21.7x 7.3x 7.7x

Group Avg 13.9 x 6.6 x 6.9 x 14.7 x 4.4 x 6.1 x

*Historicals date back to December 2009 as the Company went public in Novemb er 2009

Source: Howard Weil & Thomson One

Historical Valuations Current Valuations(assuming last 5-yrs of trading) (on 2014 estimates)

Companies Tickers FFO Cap-ex Free-CF

Free CF

Yield

Debt-to-

Cap Cash

Arch Coal ACI $279 ($355) ($76) -6.9% 64% $785

Alpha Natural Resources ANR $260 ($325) ($65) -3.7% 41% $731

Peabody Energy BTU $855 ($500) $355 6.2% 56% $559

Cloud Peak Energy* CLD $187 ($174) $13 1.1% 46% $198

CONSOL Energy CNX $1,189 ($1,398) ($208) -2.8% 45% $22

Group Average -1.2%

*Deb t includes LBA payments

Source: Howard Weil & Companies

2013E ($mm)

Coal Producers - 2013E Free Cash Flow4Q'12 ($mm)




Production Contracted Volumes

Company 2011A 2012A 2013E

'13 vs. '12 %

Change

Arch Coal ACI

Thermal Production 146.1 131.1 126.0 -3.9%

Met Coal Production 8.0 7.5 8.5 13.0%

Alpha Natural Resources ANR


Met Coal Production 19.2 20.3 20.1 -1.0%

Peabody Energy BTU

Total U.S. Production 203.9 192.6 186.6 -3.1%

Met Coal Production 9.3 14.1 15.4 9.0%Cloud Peak Energy CLD


Met Coal Production na na na na

CONSOL Energy CNX


Met Coal Production 10.5 7.3 6.9 -5.8%

Total Production 633.4 602.7 570.7 -5.3%

Total Met Production 47.0 49.2 50.8 3.3%

Source: Howard Weil & Com panies

Annual Coal Production (mm tons)

Companies % Price % Price

Arch Coal

Thermal Contracted 85% $13.37 48% $14.22

Met Contracted 46% $93.37 0% $0.00

Alpha Natural Resources

Thermal Contracted - West 97% $12.84 30% $12.75

Thermal Contracted - East 94% $62.71 15% $65.00

Met Contracted 47% $113.25 0% $130.00

Peabody Energy

Contracted - U.S. 93% $21.51 55% $21.63

Contracted - Australia 10% $94.75 0% $0.00

Met Contracted 0% $0.00 0% $0.00

Cloud Peak Energy

Thermal Contracted 89% $13.40 47% $14.49

CONSOL Energy

Thermal Contracted 102% $59.05 47% $59.92 Met Contracted 42% $90.21 3% $75.53

Gas Hedges 40% $4.66 29% $4.87

Source: Howard Weil & Companies

Coal Producers - Contract Detail

2013 2014




Production Matrix

HW Coal Group - Production Matrix

C o m p

a n i e s

C e n t r

a l A p

p

N o r t h

e r n A p p

I l l i n o i s B a

s i n

P R B

W e s t e r

n B i t

A u s t r

a l i a

M e t

S t e a

m S u

r f a c e

U n d e

r g r o u

n d

ACI 13% - 1% 74% 11% - 5% 95% 79% 21%

ANR 38% 19% - 43% - - 19% 81% 31% 69%

BTU - - 12% 73% - 15% 6% 94% 90% 10%

CLD - - - 100% - - - 100% 100% -

CNX 13% 87% - - - - 13% 87% 4% 96%

Source: Companies






Market Stats (as of 3/13/13)

Valuation (as of 3/13/13)

Target Current % Upside Avg Vol Shares MC EV Net Debt Net

Companies Ticker Action Price Price to Target (daily) Out (mm) (mm) (mm) to Cap % Debt Dividend Yield

Arch Coal ACI SP $15 $5.14 192% 12,916,543 212.0 $1,090 $5,424 60.3% $4,334 $0.12 2.3%

Alpha Natural Resources ANR SO $13 $8.01 62% 16,973,344 220.5 $1,767 $4,422 34.8% $2,655 $0.00 0.0%

Peabody Energy BTU SO $40 $21.37 87% 7,503,929 266.3 $5,691 $11,385 53.9% $5,694 $0.34 1.6%

Cloud Peak Energy CLD SP $21 $17.74 18% 920,656 61.3 $1,087 $1,493 39.4% $407 $0.00 0.0%

CONSOL Energy CNX SO $40 $32.44 23% 2,823,229 229.9 $7,459 $10,650 44.7% $3,191 $0.50 1.5%

Companies Ticker 2013E 2014E 2015E 1Q'12E 2013E 2014E 2015E 2013E 2014E 2015E 2013E 2014E 2015E

Arch Coal ACI ($1.22) ($0.28) $0.13 ($0.39) nm nm 38.7x $2.30 $3.77 $4.13 11.1x 6.8x 6.2x

Alpha Natural Resources ANR ($2.89) ($1.04) $1.19 ($0.85) nm nm 6.7x $2.19 $4.13 $6.77 9.2x 4.9x 3.0x

Peabody Energy BTU $0.46 $2.05 $3.53 ($0.16) 46.7x 10.4x 6.1x $4.74 $6.86 $8.83 9.0x 6.2x 4.8x

Cloud Peak Energy CLD $1.18 $1.50 $1.28 $0.30 15.1x 11.9x 13.9x $4.34 $4.96 $4.61 5.6x 4.9x 5.3x

CONSOL Energy CNX $0.76 $1.49 $2.37 $0.14 42.6x 21.7x 13.7x $4.76 $5.98 $7.40 9.7x 7.7x 6.3x

Group Average 34.8x 14.7x 15.8x 8.9x 6.1x 5.1x

Quarterly

Companies Ticker 2013E 2014E 2015E 1Q'12E 2013E 2014E 2015E 2013E 2014E 2015E 2013E 2014E 2015E

Arch Coal ACI ($1.15) ($0.43) ($0.11) ($0.33) $1.31 $2.15 $2.39 3.9x 2.4x 2.2x -0.3% 2.5% 3.4%

Alpha Natural Resources ANR ($2.16) ($1.22) ($0.99) ($0.60) $1.17 $3.11 $5.44 6.8x 2.6x 1.5x -6.1% -1.1% 5.5%Peabody Energy BTU $0.40 $1.91 $2.08 ($0.14) $3.20 $4.82 $2.82 6.7x 4.4x 7.6x 3.3% 6.8% 9.7%

Cloud Peak Energy CLD $1.22 $1.52 $1.30 $0.28 $3.04 $3.36 $3.15 5.8x 5.3x 5.6x 5.8% 7.0% 5.9%

CONSOL Energy CNX $1.05 $2.17 $2.38 $0.18 $3.50 $4.46 $5.57 9.3x 7.3x 5.8x 4.2% 6.2% 8.5%

Group Average 6.5x 4.4x 4.5x 1.4% 4.3% 6.6%

EV/EBITDA

Consensus Estimates

Full Year HW CF Estimates P/CF based on HW Estimates ROCE

HW EPS Estimates P/E based on HW Estimates HW EBITDA/sh Estimates





Documents

Coal FactBook -Mar2013.pdf