Barclays CEO Energy-Power Conference September 2, 2014 [September 2,] 2014
4 Moving Alpha Forward Experienced management team focused on rational portfolio management to mitigate near-term pressure and drive long-term shareholder value creation Continued focus on managing balance sheet and liquidity -…
5 Experienced Industry Leadership Management Team with Long Track Record and Deep Expertise Track record of selective growth and conservative balance sheet management through all market cycles Periodic portfolio reviews to…
6 Alphas Inherent Strengths Operational diversification Leading global supplier Large port capacity Positioned to react nimbly to upturn or continued softness in Met market Aggressive management of Thermal costs and…
8 Operational Diversification Geography Total Mines: 81* Western Coal Operations 2013 (Underground 56; Surface 25) 38.2 million tons thermal Prep Plants: 24* Eastern Coal Operations 2013 28.6 million tons thermal 20.1 million…
9 Leading Global Supplier 170 Customers in 29 Countries on 5 Continents Europe 6.8mm tons Met 2.6mm tons Thermal Canada/Mexico 1.1mm tons Met Asia 3.6mm tons Met 0.3mm tons Thermal Africa/Middle East 2.1mm tons Met 1.6mm…
10 Large Port Capacity Alpha has the Largest Port Capacity of any U.S. Coal Producer U.S. East Coast DTA - Virginia Legend - Alpha owns 41% share Anthracite Lamberts Point - Virginia Bituminous - Alpha is the largest shipper…
Global Coal Market Overview 11
12 Market Overview Expanding global energy needs lead to rising coal demand Coal is the worlds fastest growing major fuel, and least expensive and most reliable form of Global Demand electricity generation Rapid population growth,…
Metallurgical Coal
14 Metallurgical Coal Strategic Considerations Positioned for Either Market Turn or Sustained Soft Market Daily Hard Coking Coal Price Combination of supply cuts and 180 demand growth expected to balance 160 supply/demand…
15 More Balanced Growth Forecast for 2014 and 2015 Global Steel Growth Rates 2013-2015 12.0% 2013 10.0% 9.5% 2014F 8.5% 8.0% 2015F 5.8% 6.0% 4.9% 4.2% 4.3% 3.9% 3.8% 4.0% 3.4% 3.4% 3.6% 3.1% 3.0% 3.1% 3.3% 2.7% 2.8%…
16 Steady Metallurgical Coal Growth Expected Global Seaborne Metallurgical Growth Rate Nearly 4% from 2013 to 2020 140 2% 120 116 115 6% 106 108 103 4% 100 95 82 4% 81 Millions of Tonnes 77 80 80 76 74 70 4% 58 59…
Thermal Coal
18 Thermal Coal Assets Strategic Considerations Aggressively Managing Costs and Production CAPP Portfolio likely to shrink over long-term due to continued regulatory and competitive challenges Ongoing focus on safety, operating…
19 India & China Driving Global Demand China and India Account for 86% of Increased Thermal Coal Demand through 2025 10,000 1.9% 9,000 8,000 7,000 Millions of Tonnes 6,000 3% 5,000 4,000 3,000 1.3% 0.4% 2,000…
20 Evolving Domestic Coal Markets STRUCTURAL Regulation Plant retirements Permitting Interregional competition focused on Operating costs Relative geology CYCLICAL Competition from low- priced natural gas and other coal…
21 Coal Remains 1 Fuel for Electricity Generation Coal Averaging approximately 40% of U.S Power Generation 200 180 160 140 37% 120 100 TWh 80 27% 60 40 Coal Coal and natural gas generation were about even in April 2012…
Natural Gas
23 Natural Gas Strategic Considerations Monetize, Maintain and Grow Success of Rice Energy JV and significant value creation established blueprint for further success in natural gas Multiple options for unlocking value from natural…
24 Proactive Portfolio Management Monetized Portion of Alphas Natural Gas Portfolio Monetized a portion of Alpha's Marcellus acreage for 300 million; 100 million in cash and 9.5 million shares of RICE* Alpha has entered into a new…
Cost Control, Capital Structure and Liquidity Management
26 Proactive Portfolio Management Aggressive Operating Cost Reductions in 2013 and 2014 to Enhance Cost Structure for Current Market Environment Est. Change Category 2012 2013 MP 2014* from 2012 Eastern cost/ton** 73.77 71.40…
27 Proactive Portfolio Management Aggressive SG&A and Capex Reductions in 2013 and 2014 Est. Change Category 2012 2013 MP 2014* from 2012 SG&A (in millions) 209.8 159.0 125.0 -84.8 Capex (in millions) 498.1 257.8 250.0…
28 Prudently Managing Capital Structure & Liquidity Preserve Cash, Maintain Financial Flexibility Maintain maturity profile with limited near-term maturities and manage liquidity to support focused operations while ensuring…
29 Enhanced Financial Flexibility Recent Proactive Steps: Amended credit agreement: - Suspends interest coverage ratio through 2015 - Provided incremental senior debt capacity under the accordion - Senior secured net leverage…
31 Key Takeaways Leading global coal producer with broad product and regional diversification Top 5 in worldwide met shipments Diversified customer base in nearly 30 countries Most port capacity among US producers Strong,…
Appendices alphanr.com
33 Reconciliation Use of Non-GAAP Measures In addition to information prepared in accordance with generally accepted accounting principles in the United States (GAAP) provided throughout this presentation, Alpha has presented the…
34 Reconciliation of Cost of Coal Sales Reconciliation of Adjusted Cost of Coal Sales Per Ton-East to Cost of Coal Sales Per Ton Twelve months ended December 31, 2013 December 31, 2012 Cost of coal sales per ton-East 72.51 71.76…
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