Alpha Metallurgical Resources, Inc. · NYSE:AMR
Alpha Metallurgical Resources — Investor Presentation (November 2021)
27 slides from Alpha Metallurgical Resources's investor presentation, November 2021
Slide 1: Investor Presentation
Investor Presentation November 2021
Slide 2: Forward Looking Statements
Forward Looking Statements This document includes forward-looking statements. These forward-looking statements are based on Alpha's expectations and beliefs concerning future events and involve risks and uncertainties that may cause actual results to differ materially from current expectations. Thes
Slide 3: Table of Contents
Table of Contents Vision, Execution & Leadership 4 Company Overview – Alpha Advantages 9 Operations and Financial Update 14 Market Analysis – Macro Environment Remains Positive 18 Conclusion: Alpha Well-Positioned for the Future 21 Appendix 23 3
Slide 4: Vision, Execution & Leadership
Vision, Execution & Leadership
Slide 5: Alpha Investment Thesis
Alpha Investment Thesis Investment Highlights •1 Largest and Most Quality Diverse Metallurgical Coal Producer in U.S. •2 Portfolio of Long-Lived Metallurgical Mines and Substantial Organic Reserve Growth Opportunities •3 Operational Excellence: Cost Control, Safety, Environmental •4 Advantaged Sales
Slide 6: Pathway to a Pure Metallurgical Coal Portfolio
Pathway to a Pure Metallurgical Coal Portfolio Metallurgical Coal Shipments Expected to Account for More than 90% of the Total Volume by 2023 Met 14% 18% 48% 55% 61% 82% 90% 93% Thermal 86% 82% 52% 45% 39% 18% 10% (1) Based on midpoint of guidance. 7% (2) Targeted goal. 2016 2017 2018 2019 2020 2021
Slide 7: Cost-Efficient, Well-Managed and Robust Operating Portfolio
Cost-Efficient, Well-Managed and Robust Operating Portfolio Note: Production and reserves information as of 12/31/20. List of active mines as of 9/30/21. * Contractor mine ** Surface mine 7
Slide 8: Experienced Leadership Team Streamlining Decision-Making
Experienced Leadership Team Streamlining Decision-Making 8
Slide 9: Company Overview – Alpha Advantages
Company Overview – Alpha Advantages
Slide 10: Alpha Snapshot
Alpha Snapshot (1) NYSE: AMR (1) Metrics as of 12/31/20 unless otherwise noted. (2) Alpha Natural Resources, Inc. founded in 2003. (3) As of 9/30/21. See slide 7 for list of mines and preparation plants. (4) See map on slide 13 for specific countries. (5) Since 2016. 10
Slide 11: Alpha Advantages – Most Diverse Domestic Metallurgical Producer
Alpha Advantages – Most Diverse Domestic Metallurgical Producer Largest Domestic Met Producer (1)(2) Well-Balanced Met Quality Mix (2) LV 13% 13.5 million tons HVA 39% Midpoint of Alpha’s 2021 MV 24% Met Guidance HVB 24% In Millions of tons 12.2 Diversified Revenue Mix (2) 7.9 6.8 5.6 Domestic 29% 1
Slide 12: Strong Safety and Environmental Performance Continues
Strong Safety and Environmental Performance Continues Non-Fatal Days Lost (NFDL) Violations Per Inspection Day (VPID) 3.0 0.7 National 2.5 National 0.6 Average Average 0.61 2.0 0.5 2.23 0.4 1.5 0.3 0.56 0.55 1.0 2.07 2.18 0.53 1.79 0.2 0.5 0.1 0.0 0.0 2019 2020 2021* 2019 2020 2021* *YTD Sept. 30, 2
Slide 13: Alpha Advantages – Largest Domestic Met Producer & Exporter
Alpha Advantages – Largest Domestic Met Producer & Exporter DTA provides a platform for extensive worldwide exports Port of Hampton Roads (Newport News, Virginia) 65% Owned by Alpha (35% by Arch) 22 million tons of capacity (14.3 million attributable to Alpha) 1.7 million tons of ground stor
Slide 14: Operations and Financial Update
Operations and Financial Update
Slide 15: Met Segment Cost of Coal Sales Bridge
Met Segment Cost of Coal Sales Bridge With higher sales prices, our Met segment cost of coal sales are expected to increase due to royalties and taxes based on sales price. Additionally, higher labor and benefits, alongside increased costs for certain materials such as steel used in roof support and
Slide 16: 2022 Capital Expenditures – Investing in Alpha's Future
2022 Capital Expenditures – Investing in Alpha’s Future $250.0 $175 million* $200.0 expected 2022 capex $55 Million* $150.0 Project Investment In millions $100.0 $120 Million* Maintenance $50.0 Capex $81.9 $192.4 $154.0 $93.0 $0.0 2018A 2019A 2020A 2021E* 2022E* *Midpoint of Guidance 16
Slide 17: 2022 Anticipated Capex Investment Projects
2022 Anticipated Capex Investment Projects Alpha’s 2022 Capital Expenditures guidance includes roughly $120 million* in maintenance capital, increased due to inflationary pressure on labor and supplies, and another approximately $55 million* for special investment projects to enhance our portfolio.
Slide 18: Market Analysis – Macro Environment Remains Positive
Market Analysis – Macro Environment Remains Positive
Slide 19: Pricing Momentum Intensifies Through 2021
Pricing Momentum Intensifies Through 2021 Metallurgical Coal Indices $440.00 $390.00 $340.00 $290.00 $ / metric ton $240.00 $190.00 $140.00 $90.00 US High Vol A US High Vol B US Low Volatile Premium Low Vol HCC Sources: Bloomberg and Platts 19
Slide 20: Solid Global Steel Demand Growth Expected in 2021 and Beyond
Solid Global Steel Demand Growth Expected in 2021 and Beyond Global Steel Demand Projected Crude Steel Production in India through 2050 1,850 1,925 380 360 1,874 +3% 340 1,800 320 300 +6% In 000s of metric tons In 000s of metric tons 280 1,750 260 +5% 1,767 1,772 240 CAGR 220 1,700 200 180 160 1,650
Slide 21: Conclusion: Alpha Well-Positioned for the Future
Conclusion: Alpha Well-Positioned for the Future
Slide 22: Conclusion: Alpha Plans to Harvest Benefits of Disciplined Planning
Conclusion: Alpha Plans to Harvest Benefits of Disciplined Planning Significant reduction of long-term debt and legacy liabilities to create a stronger company 1 • Over $75 million reduction in long-term debt and legacy liabilities in third quarter 2021, including early prepayments and repurchases •
Slide 23: Appendix
LPHA METALLURGICAL RESOURCES Appendix
Slide 24: 2021 Guidance (as of November 5, 2021)
2021 Guidance (as of November 5, 2021) Shipments (million tons) Low High Metallurgical 13.0 14.0 Non-Metallurgical By-Product 1.3 1.8 Met Segment 14.3 15.8 All Other 1.3 1.7 Total Shipments 15.6 17.5 Committed / Priced Volumes(1)(2)(3) % Committed Average Price ($/ton) Metallurgical – Domestic $88.5
Slide 25: 2022 Guidance (as of November 5, 2021)
2022 Guidance (as of November 5, 2021) Shipments (million tons) Low High Metallurgical 14.0 15.0 Non-Metallurgical By-Product 0.8 1.2 Met Segment 14.8 16.2 All Other 0.6 0.8 Total Shipments 15.4 17.0 Committed / Priced Volumes(1)(2)(3) % Committed Average Price ($/ton) Metallurgical – Domestic $192.
Slide 26: Federal Net Operating Losses (NOL) and Usage Limitations
Federal Net Operating Losses (NOL) and Usage Limitations US $ millions Estimated NOL Estimated NOL Estimated Gross Deduction Deduction Year Year NOL Available for Available for Generated Expires Carryforward at Utilization in Utilization in 12/31/2020 2021 2022 2015(1) 2035 $ 1,011.0 $ 3.0 $ 1.0 201
Slide 27: Cash-Related Outflows Expected to Materially Decrease After 2022
Cash-Related Outflows Expected to Materially Decrease After 2022 Cash Outlays (US$ millions) 2021 2022 2023 2024 Acquisition Related Obligations $8.2 $4.2 $ -- $ -- Contingent Revenue Obligations(1) 14.1 21.7 5.6 -- LCC Obligations(2) 20.4 -- -- -- Reorganization & Transaction-related Cash Outlays 4
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