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Q1 2014 Earnings Call – Consol Energy Inc.

Consol Energy Inc. · Apr 29, 2014 · 26 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q1 2014 Earnings Call – Consol Energy Inc. – slide 1
    First Quarter 2014 Earnings Presentation April 29, 2014 J. Brett Harvey, Chairman and CEO Nicholas J. DeIuliis, President David Khani, CFO James C. Grech, Chief Commercial Officer Tim Dugan, COO E&P Division
  2. Q1 2014 Earnings Call – Consol Energy Inc. – slide 2
    CONSOL Energys Business Strategy Grow natural gas production 30% projected production increase in 2014 Develop liquids profile within our footprint High-grade acreage position Experienced team is in place Aggressively manage…
  3. Q1 2014 Earnings Call – Consol Energy Inc. – slide 3
    First Quarter 2014 Results Summary Pre-tax income for the first quarter was 130 million - Net income from continuing operations was 122 million resulting from solid E&P and coal production, higher gas prices, and disciplined cost…
  4. Q1 2014 Earnings Call – Consol Energy Inc. – slide 4
    Q4 2013 to Q1 2014 Net Income Reconciliation 1,000 42 4 (6) (139) 900 74 738 ( in millions) 800 (597) 700 600 500 400 300 200 116 100 - Q4 2013 Net E&P Coal Division Interest Other Income Discontinued Q1 2014 Net…
  5. Q1 2014 Earnings Call – Consol Energy Inc. – slide 5
    Gas Division Summary Q-to-Q Q-to-Q Gas Division 1Q2014 1Q2013 Change 1Q2014 4Q2013 Change Average Sales Price ( / Mcfe) 5.52 4.30 1.22 5.52 4.26 1.26 Average Costs ( / Mcfe) 3.63 3.53 0.10 3.63 3.55 0.08 Sales Volumes (Bcfe) 48.4…
  6. Q1 2014 Earnings Call – Consol Energy Inc. – slide 6
    Gas Division Production Results and Forecast Gas and Liquids Production (Bcfe) CONSOL is rapidly growing its natural gas production Total 2013 natural gas production: 172.4 Bcfe Q1 2014 natural gas production: 48.4 Bcfe Total 2014…
  7. Q1 2014 Earnings Call – Consol Energy Inc. – slide 7
    Coal Division Summary Q-to-Q Q-to-Q Coal Division 1Q2014 1Q2013 Change 1Q2014 4Q2013 Change Average Sales Price ( / ton) 66.20 72.18 (5.98) 66.20 66.85 (0.65) Average Costs ( / ton) 45.15 51.14 (5.99) 45.15 50.05 (4.90) Coal…
  8. Q1 2014 Earnings Call – Consol Energy Inc. – slide 8
    Hedge Program and Integrated Infrastructure 2014 Competitor and CNX Hedge Positions Actively Monitored Hedge Program: Swaps Collars Priced Coal 100% 86% - For 2014: 25.7 Bcf added in the first quarter at 87% approximately 5.32 per…
  9. Q1 2014 Earnings Call – Consol Energy Inc. – slide 9
    CONSOL Cost Metrics Gas: Operating Costs per Mcfe 6 5 / Mcfe 4 3 2 1Q2012 2Q2012 3Q2012 4Q2012 1Q2013 2Q2013 3Q2013 4Q2013 1Q2014 CBM Marcellus Shallow Oil & Gas Coal: Cost per Ton Sold 86 76 / Ton 66 56 46…
  10. Q1 2014 Earnings Call – Consol Energy Inc. – slide 10
    Gas Operations: Capital Expenditure 1,200 1,110 1,000 953 800 in millions 600 528 400 200 0 2012 2013 2014E Land Capex Other Gas Capex 2014E Total Gas Capex Estimate Natural Gas Operations: ( in millions) 2014E Capex…
  11. Q1 2014 Earnings Call – Consol Energy Inc. – slide 11
    Strong Liquidity Position of 2.1 Billion Cash on hand of 314 million Accounts receivable securitization and revolving credit facilities of 1.8 billion Amount/ Amount Letters Amount March 31, 2014 ( in million) Capacity Drawn of…
  12. Q1 2014 Earnings Call – Consol Energy Inc. – slide 12
    CONSOL Energy Overview Net (Decrease) / Increase in Cash - in millions Goal is to maintain our strong liquidity position Cash Flow Summary Q-to-Q Q-to-Q ( in millions) 1Q2014 1Q2013 Change 1Q2014 4Q2013 Change Net Cash Provided by…
  13. Q1 2014 Earnings Call – Consol Energy Inc. – slide 13
    Murray Energy Transaction Impact: Credit Metrics CONSOL Energy ( in millions) 2011 2012 2013 Cash and Cash Equivalents 376 22 327 Available Liquidity 2,733 2,351 2,081 Total Debt 3,198 3,251 3,175 (1) Net Debt 2,822 3,229 2,848…
  14. Q1 2014 Earnings Call – Consol Energy Inc. – slide 14
    Recent Notes Offering Summary Senior Unsecured Notes Issuer CONSOL Energy Inc. Notes offered 1,600 million aggregate principal amount of 5.875% senior notes due 2022 Maturity date April 15, 2022 Interest rate 5.875% per year…
  15. Q1 2014 Earnings Call – Consol Energy Inc. – slide 15
    Drilling Results and Forecast Formation Region 2012 2013 1Q2014 2014E Marcellus Shale: Southwest Pa. (incl NBL) 70 97 26 144 West Virginia 6 10 4 25 Central Pa. 13 10 5 12 Ohio 0 0 0 1(1) Total: 89 117 35 182 Utica Shale (incl…
  16. Q1 2014 Earnings Call – Consol Energy Inc. – slide 16
    CONSOL Energy Overview Summary Gas and coal operations are long-lived, low-cost, and provide solid growth Our well-capitalized assets and highly trained personnel provide more consistent operational execution Our emphasis on safety…
  17. Q1 2014 Earnings Call – Consol Energy Inc. – slide 17
    Appendix 18
  18. Q1 2014 Earnings Call – Consol Energy Inc. – slide 18
    Appendix Marketing 2Q14 and 2014 Forecasts 2014 Coal Sales Facts and Goals Sales Tons by Product Year 2014 Contracted tons for 2014: more than 92% 6% - Priced: more than 89% 12% Approximately 81% of the Low-Vol & High-Vol met coal…
  19. Q1 2014 Earnings Call – Consol Energy Inc. – slide 19
    Appendix Coal Division Guidance 2014 firm tonnage: 2015 firm tonnage: - Low-Vol: 59% - Low-Vol: 16% - High-Vol: 50% - High-Vol: 15% - Thermal: 97% - Thermal: 43% - Total Coal Sales: 89% - Total Coal Sales: 37% (Tons in millions)…
  20. Q1 2014 Earnings Call – Consol Energy Inc. – slide 20
    Appendix Coal Capital Expenditure 10 Year History 1,000 993 25% 900 20% 800 681 707 700 677 15% 580 in millions 600 489 500 446 459 10% 415 390 400 317 5% 300 203 200 0% 100 0 (5%) 2003 2004 2005 2006 2007…
  21. Q1 2014 Earnings Call – Consol Energy Inc. – slide 21
    Appendix Use of Cash Proceeds 1,000 900 850 8 (361 ) 800 700 in millions 600 (115 ) 500 (31 ) 400 (37 ) 327 300 200 100 13 0 Beginning Receipt from Tetrick Credit DTI Acres / Fees Other Ending Cash Cash Balance…
  22. Q1 2014 Earnings Call – Consol Energy Inc. – slide 22
    Appendix BMX Mine Overview BMX Mine: Began operations in mid-March 2014 - Lowest cost CNX mine 23
  23. Q1 2014 Earnings Call – Consol Energy Inc. – slide 23
    Appendix Our Domestic Coal Market Remains Solid PJM Coal Inventory Trailing 12 Months 5 Year Average 30 25 20 Tons (MM) 15 10 5 - Feb 13 May 13 Aug 13 Nov 13 Source: EIA, PIRA, and CONSOL analysis. 24
  24. Q1 2014 Earnings Call – Consol Energy Inc. – slide 24
    Appendix CONSOL-Operated Wells: Marcellus Drilling and Completions Summary Drilling Summary 2011 2012 2013 YTD 2014 Wells TD'd 78 64 46 16 Lateral Ft 300,466' 328,428' 366,615' 124,297' Total MD 92,264' 794,098' 730,316' 251,113'…
  25. Q1 2014 Earnings Call – Consol Energy Inc. – slide 25
    Appendix Non-GAAP Reconciliation CONSOL Energy ( in millions) 2011 2012 2013 Net Income Attributable to CONSOL Energy Inc. Shareholders 632 388 660 Add: Interest Expense 248 220 219 Less: Interest Income (9) (29) (16) Add: Income…
  26. Q1 2014 Earnings Call – Consol Energy Inc. – slide 26
    Appendix Reconciliation of EBIT, EBITDA and Adjusted EBITDA to financial net income Three Months Ended March 31 ( in thousands) 2014 2013 Net Income Attributable to CONSOL Energy Inc. Shareholders 116,003 (1,564) Less: Net…

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