Transcript Document

RESULTS FOR SIX MONTHS ENDED
30 SEPTEMBER 2013
Monday, 18 November 2013
10h00
WWW.KEATONENERGY.CO.ZA
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CHIEF EXECUTIVE OFFICER
MANDI GLAD
2
LOCATION
OPERATIONS AND PROJECTS
Moabsvelden
Vanggatfontein Colliery
Sterkfontein Project
National road
Braakfontein Project
Koudelager Project
Vaalkrantz Colliery
City
Town
Power station
Richards Bay coal line
Colliery
Project
Acquisition
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HIGHLIGHTS
Good safety performance
R205 million cash generated
from operations
R117 million gross profit compared with a gross loss of
R38 million in 1HFY13
HEPS up 192%
from (21.1) cps to 19.4 cps
R39 million debt repaid
70% increase in group
55% increase in
revenue to R710 million
Eskom sales to 1.1Mt
Commenced development
of Pit 4 at Vanggatfontein
Acquisition of Xceed Resources
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SAFETY
FATALITY FREE SINCE INCEPTION
VANGGATFONTEIN LTIFR
VAALKRANTZ LTIFR
0.45
0.20
0.36
0.10
0.17
0.00
1HFY13
2HFY13
1HFY14
1HFY13
2HFY13
1HFY14
* LTIFR per 200 000 man hours
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OPERATIONS
VANGGATFONTEIN
VAALKRANTZ
1HFY13
2HFY13
1HFY14
Sales (kt)
769
805
1 198
ROM (kt)
1 473
1 312
1 727
Revenue (Rm)
284
362
EBITDA (Rm)
36
Capex (Rm)
No. of employees*
1HFY13
2HFY13
1HFY14
Sales (kt)
151
175
154
ROM (kt)
285
266
228
585
Revenue (Rm)
133
139
125
62
269
EBITDA (Rm)
23
8
9
71
133
135
Capex (Rm)
7
0
2
406
416
486
No. of employees*
767
778
808
* Includes contractors
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GROWTH
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SUSTAINABLE
GROWTH PROFILE
Mtpa saleable
5.36
Braakfontein
Project
LOM
12years
4.26
Moabsvelden
Project
2.86
2.75
LOM
18 years
Koudelager Project LOM 20 years
Vaalkrantz Colliery
2.40
LOM 12 – 24 months
Vanggatfontein
Colliery
2010
2011
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2012
2013
2014
2015
2016
2017
LOM
20 years
2018
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XCEED ACQUISITION
RATIONALE
» Proximity to Vanggatfontein
» 44Mt reserve doubles our Delmas footprint
» Quick lead time
» Executed mining right
» NEMA approval
» Credit approved term sheet
» Low stripping ratio
» Long life open pit
» Operational and financial synergies
» Product diversification
» Increase Eskom supply
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XCEED ACQUISITION
TIMELINE
Implementation Deed

KEH shareholder meeting
23 Jan
Competition Commission Approval

Xceed Scheme meeting, announce
results to ASX
03 Feb
Gunvor Subscription Agreement

Second Court Date, announce to ASX
06 Feb
Credit Approved Term Sheet

Effective date
- file court order with ASIC and
07 Feb
Submission of circular to JSE
18 Nov
SARB Approval
18 Nov
Post circular to shareholders
First Court Date
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24 Dec
16 Dec
announce to ASX
- Xceed securities cease trading at
close of trading on ASX
Record Date for entitlement to
Scheme Consideration
14 Feb
Implementation Date – KEH pays
Aggregate Scheme Consideration
to Xceed
19 Feb
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CHIEF FINANCIAL OFFICER
JACQUES ROSSOUW
11
FINANCIAL
PERFORMANCE
EXTRACTS FROM THE STATEMENT OF
COMPREHENSIVE INCOME (Rm)
Revenue
1HFY14
1HFY13
% CHANGE
FY13
709.8
417.3
70%
918.8
(592.6)
(455.2)
30%
(946.1)
* Cash cost
(412.4)
(374.5)
10%
(726.3)
* Depreciation
(183.1)
(121.9)
50%
(235.2)
2.9
41.2
(93%)
15.4
117.2
(37.9)
>100%
(27.3)
84.6
(69.9)
>100%
(139.4)
(21.4)
19.5
>(100%)
39.3
Profit/(loss) after tax
42.3
(64.2)
>100%
(132.3)
HEPS (cents per share)
19.4
(21.1)
>100%
(30.2)
Cost of Sales
* Inventory
Gross profit/(loss)
Operating profit/(loss)
Income taxation (expense)/credit
* From operational results
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FINANCIAL
PERFORMANCE
COST OF SALES ANALYSIS (Rm)
1HFY14
1HFY13
Mining Contractors
255.6
199.6
Amortisation and depreciation
183.1
126.2
Transport costs
160.9
94.6
Fuel
63.1
43.8
Other direct mining costs
67.5
74.4
Inventory movement
(2.9)
(41.2)
(134.7)
(42.2)
592.6
455.2
Deferred stripping capitalised
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FINANCIAL
PERFORMANCE
GROSS PROFIT
20%
20%
700
17%
500
10%
10%
5%
400
300
200
5%
0%
100
2%
0
-100
15%
15%
GP %
Revenue (Rm)
600
1HFY13
2HFY13
1HFY14
0%
-5%
-5%
-10%
-200
(9%)
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-10%
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FINANCIAL
PERFORMANCE
EBITDA
40%
700
38%
35%
30%
500
25%
400
20%
300
200
EBITDA %
Revenue (Rm)
600
15%
12%
10%
9%
100
5%
0
0%
1HFY13
2HFY13
1HFY14
*EBITDA excluding loss on de-recognition of asset in 2HFY13
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FINANCIAL
PERFORMANCE
HEADLINE EARNINGS PER SHARE (CPS)
25
19.4
20
15
8.4
10
5
1.7
0
-5
-10
-15
-20
(21.1)
-25
1HFY11
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1HFY12
1HFY13
1HFY14
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FINANCIAL
PERFORMANCE
» GROUP NET DEBT (Rm)
Net debt
1 Apr 2013
Cash from
operations
Foreign
exchange losses
Tax
Capital
additions
Other net
investing
activities
Net debt
30 Sept 2013
0
-40
-6
-2
-80
-204
-120
-265
-160
-200
-143
205
7
-240
-280
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FINANCIAL
PERFORMANCE
PROPERTY, PLANT AND EQUIPMENT (Rm)
Stripping costs
1HFY14
FY13
155.9
109.9
32.3
85.2
Mine development
260.2
253.1
Plant and equipment
184.3
195.0
88.9
92.5
Boxcut development
Mine infrastructure
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CHIEF EXECUTIVE OFFICER
MANDI GLAD
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LOOKING
AHEAD
Pursue long
term strategy of producing 5Mtpa
Product mix diversification
Continue to optimise operations
Maximise cash generation
Advance project pipeline
Close acquisition of Xceed
Prudent financial management
Convince a sceptical market of our sustainability and
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worth
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DISCLAIMER
Opinions expressed herein are by nature subjective to known and unknown risks
and uncertainties. Changing information or circumstances may cause the actual
results, plans and objectives of Keaton Energy Holdings Ltd (the “Company”) to
differ materially from those expressed or implied in the forward looking
statements. Financial forecasts and data given herein are estimates based on the
reports prepared by experts who in turn relied on management estimates.
Undue reliance should not be placed on such opinions, forecasts or data. No
representation is made as to the completeness or correctness of the opinions,
forecasts or data contained herein. Neither the Company, nor any of its affiliates,
advisors or representatives accepts any responsibility for any loss arising from the
use of any opinion expressed or forecast or data herein. Forward-looking
statements apply only as of the date on which they are made and the Company
does not undertake any obligation to publicly update or revise any of its opinions
or forward looking statements whether to reflect new data or future events or
circumstances.
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