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February 2020 Investor Presentation – Consol Energy Inc.

Consol Energy Inc. · Feb 24, 2020 · 39 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. February 2020 Investor Presentation – Consol Energy Inc. – slide 1
    CONSOL Energy Inc. CONSOL Coal Resources LP Investor Presentation February 2020
  2. February 2020 Investor Presentation – Consol Energy Inc. – slide 2
    CONSOL Energy Coal Industry Leader 1 Our Legacy is Built on Safety, Compliance, and Continuous Improvement through Experienced Management 2 PAMC 1st Quartile Cost Position Sustains Margins through the Cycle 3 Opportunistically…
  3. February 2020 Investor Presentation – Consol Energy Inc. – slide 3
    CONSOL Energy Performance Since November 2017 Spin Spin 14% -17% Today 420.00 16% 900.00 -16% 410.00 406 14% 766 800.00 400.00 -16% 12% 700.00 635 390.00 -17% 380.00 10% 600.00 370.00 8% 500.00 -17% 357 400.00 360.00 6%…
  4. February 2020 Investor Presentation – Consol Energy Inc. – slide 4
    Pennsylvania Mining Complex Overview Three highly productive, well-capitalized underground coal mines. Five longwalls and 1517 continuous miner sections. Largest central preparation plant in the United States. PA Mining CONSOL…
  5. February 2020 Investor Presentation – Consol Energy Inc. – slide 5
    1st Quartile Cost Position in NAPP and Globally 1st quartile cost position in NAPP (2019)(1) (Cash costs per ton) 1st Quartile 2nd Quartile 3rd Quartile 4th Quartile 60 50 40 30 20 10 0 10 20 30 40 50 60 70 Cumulative…
  6. February 2020 Investor Presentation – Consol Energy Inc. – slide 6
    CONSOL Marine Terminal Overview Overview Coal export terminal strategically located in Baltimore, Maryland. 15.0 million tons per year throughput capacity. 1.1 million tons coal storage yard capacity. Only East Coast coal export…
  7. February 2020 Investor Presentation – Consol Energy Inc. – slide 7
    On-Site Key Logistics Infrastructure and Advantaged Export Access in a Growing Export Market Dual-served railroad access Port of Baltimore PAMC Core Markets Eastern U.S. coal regions and points of thermal export(1) 10…
  8. February 2020 Investor Presentation – Consol Energy Inc. – slide 8
    Itmann Project High Returns & Measured Pace of Investment Location Wyoming County, WV Estimated capacity: 900,000+ tons/year Production (3 CM sections) Capacity Full production expected by 2022 18+ million tons life-of-mine…
  9. February 2020 Investor Presentation – Consol Energy Inc. – slide 9
    Itmann Project Will Cater to Growing Market with Shrinking High Quality Supply According to Wood Mackenzie: Global seaborne met coal demand will rise from 313 Mt in 2019 to 422 Mt by 2040. Indian imports increase to 142 Mtpa in…
  10. February 2020 Investor Presentation – Consol Energy Inc. – slide 10
    Multi-pronged PAMC Marketing Strategy Illustrative portion of annual production 1 Maximize sales to established customer base of rail-served power plants in the Eastern U.S., with a focus on top-performing environmentally- 60 80%…
  11. February 2020 Investor Presentation – Consol Energy Inc. – slide 11
    Highly-Diversified Portfolio Provides Stability Annual coal sales (million tons) 2019A Export thermal 2019A Export met 27.7 27.3 26.1 24.6 22.9 Europe Africa India Canada/North America Other Asia South America 2019A…
  12. February 2020 Investor Presentation – Consol Energy Inc. – slide 12
    Strong Contracted Position Supported by Diversified Customer Base Our customers(1) Limited volume at risk due to announced power plant retirements 2018 domestic power plant shipments by unit retirement status Announced Coal…
  13. February 2020 Investor Presentation – Consol Energy Inc. – slide 13
    Export Sales Continue to Play Vital Role for CONSOL Established a new longwall at Ramped up exports in Reduced exports and Harvey Mine in 2014, thereby Sold 3.6 million export deemphasized met response to continued increasing…
  14. February 2020 Investor Presentation – Consol Energy Inc. – slide 14
    Premium Quality Coal and Differentiated Marketing Strategy Ensures Continued Participation in Seaborne Markets Differentiated Marketing Strategy Provides Strong Revenue Visibility Best-in-class Btu content(1) Entered into a three-year…
  15. February 2020 Investor Presentation – Consol Energy Inc. – slide 15
    Solid Global Coal-Fired Generation Capacity Growth Continues Global coal power plant build outs under construction by year Global coal power plant build outs by country 90 China India Indonesia Vietnam Other Asia Rest of World 70…
  16. February 2020 Investor Presentation – Consol Energy Inc. – slide 16
    With a Highly Competitive Position Versus Natural Gas LNG and API 2 Futures(1) Current LNG Forwards Current API2 Forwards 90 80 70 60 Index 50 40 30 20 Dec-20 Dec-21 Dec-22 Jun-22 Jun-20 Jun-21…
  17. February 2020 Investor Presentation – Consol Energy Inc. – slide 17
    PAMC Growing Share in Favored US Basin Despite Coal Power Plant Retirements PAMC has taken advantage of shifting domestic PAMC sales have increased despite US thermal coal demand coal plant retirements High cost / unfavorable basin…
  18. February 2020 Investor Presentation – Consol Energy Inc. – slide 18
    Coal Supply Rationalization Supply rationalization is happening in the domestic and global markets. As of mid-January 2020, DTC estimates that domestic coal cutbacks were approximately 17 million tons in 2019, including 13 million…
  19. February 2020 Investor Presentation – Consol Energy Inc. – slide 19
    Financial Priorities Accelerate open market debt repurchases. De-lever the Improve free cash flow generation through spending cuts and capex deferrals. balance sheet Consistent with historical trends, focused on reducing legacy…
  20. February 2020 Investor Presentation – Consol Energy Inc. – slide 20
    CEIX Accelerating Debt/Equity Repurchases CEIX Repurchase Program Authorization(1) Cumulative Repurchases Remaining Availability Repurchase authorization of an aggregate 200MM. Current availability of 56MM. 200 200 200 Does not…
  21. February 2020 Investor Presentation – Consol Energy Inc. – slide 21
    Shrinking Access to Capital Strengthens Existing Production Capital Market Access Coal Debt Equity 25 64.4 billion capital raised 2014 2019. 20 18.6 Debt = 45.1 billion Transaction Value (B) Equity = 19.3 billion 6.2 14.3…
  22. February 2020 Investor Presentation – Consol Energy Inc. – slide 22
    CEIX A Measured Approach to Growth Competes with debt and equity repurchases. Strategically strengthens our production base, enables diversification, and reduces risk. Efficiency Technology Organic Growth M&A Efficiency &…
  23. February 2020 Investor Presentation – Consol Energy Inc. – slide 23
    Fourth Quarter Results and 2020 Guidance For the Quarter Ended Guidance Earnings Results December December CEIX CCR 31, 2019 31, 2018 Change 2020(5) 2020(5) Pennsylvania Mining Complex Volumes (MM Tons) Production 6.7 6.8 (0.1)…
  24. February 2020 Investor Presentation – Consol Energy Inc. – slide 24
    Leverage and Liquidity Analysis Adjusted Method Bank Method CEIX Financial Metrics (MM except ratios) LTM 12/31/2019 LTM 12/31/2019 Leverage EBITDA(1)(2) 406 329 Consolidated Net Debt(3) 635 635 Net Leverage Ratio(1) 1.6x 1.9x…
  25. February 2020 Investor Presentation – Consol Energy Inc. – slide 25
    Corporate Sustainability Approach Our Legacy is Built on Safety, Compliance, and Continuous Improvement PA Mining Complexs MSHA reportable incident rate was 40% lower than the industry average from 2015 - 2019.1 2019 marked 6th…
  26. February 2020 Investor Presentation – Consol Energy Inc. – slide 26
    ESG Priorities: Creating Shared Value Producing high-Btu bituminous coal; carbon intensity 5-20% below other ranks.1 Environment Marketing to low heat rate, environmentally controlled customers. Expanding methane destruction program…
  27. February 2020 Investor Presentation – Consol Energy Inc. – slide 27
    Exemplifying Our Commitment to Continuous Improvement with Bettercoal CONSOL Committed to Become a Bettercoal Supplier Bettercoal is a global organization that was established by major coal buyers. (1) Seeks to advance the…
  28. February 2020 Investor Presentation – Consol Energy Inc. – slide 28
    Appendix 29
  29. February 2020 Investor Presentation – Consol Energy Inc. – slide 29
    Organizational Structure Overview CONSOL Energy Inc. NYSE: CEIX 26 million shares outstanding 100% ownership 100% interest ownership interest 59.8% CONSOL Coal Resources GP LLC 1.6 billion tons of limited partner (our…
  30. February 2020 Investor Presentation – Consol Energy Inc. – slide 30
    CEIX Balance Sheet Legacy Liabilities Significant legacy liability reductions over the past three years Legacy liabilities Balance Sheet Cash Servicing (mm) Value Cost The OPEB liability decreased 9 million from 2018 to 2019.…
  31. February 2020 Investor Presentation – Consol Energy Inc. – slide 31
    Experienced Management with Enhanced Focus on Safety, Compliance and Financial Discipline CEIXs management and operating teams have a long history in the coal industry. Key performance results Proven track record of successfully…
  32. February 2020 Investor Presentation – Consol Energy Inc. – slide 32
    CEIX Adjusted EBITDA & Organic Free Cash Flow Net to CEIX Shareholders Reconciliations EBITDA Reconciliation LTM 4Q19 4Q18 12/31/2019 Net Income 17.4 46.0 93.6 Plus: Interest Expense, net 16.2 20.4 66.5 Interest Income (0.5) (0.6)…
  33. February 2020 Investor Presentation – Consol Energy Inc. – slide 33
    CCR Adjusted EBITDA & Organic Free Cash Flow Reconciliations Adjusted EBITDA Reconciliation 4Q19 4Q18 Net Income 9.0 16.6 Plus: Interest Expense, Net 2.1 1.4 Depreciation, Depletion and Amortization 12.2 11.0 EBITDA 23.3 28.9…
  34. February 2020 Investor Presentation – Consol Energy Inc. – slide 34
    CEIX Net Leverage Ratio Reconciliations CEIX Net Leverage Ratio Reconciliations Adjusted Method Bank Method LTM 12/31/2019 LTM 12/31/2019 Net Income 94 94 Plus: Interest Expense, net 66 66 Interest Income (3) (3) Income Tax…
  35. February 2020 Investor Presentation – Consol Energy Inc. – slide 35
    Adjusted Net Income and Adjusted Dilutive EPS Reconciliations (MM except per share data) 2019 Net Income 93.6 Plus: Adjustments to Net Income 18.7 Plus: Tax Benefit of Adjustments to Net Income 0.5 Adjusted Net Income 112.7 Less:…
  36. February 2020 Investor Presentation – Consol Energy Inc. – slide 36
    CCR Net Leverage Ratio Reconciliation CCR Net Leverage Ratio Reconciliation LTM 12/31/2019 Net Income 45.6 Plus: Interest Expense, Net 6.6 Depreciation, Depletion and Amortization 45.8 Unit-Based Compensation 1.4 Non-Cash…
  37. February 2020 Investor Presentation – Consol Energy Inc. – slide 37
    CCR Distribution Coverage Ratio Reconciliation CCR Distribution Coverage Ratio Reconciliation 4Q19 YTD 12/31/2019 Net Income 9.0 45.6 Plus: Interest Expense, Net 2.1 6.6 Depreciation, Depletion and Amortization 12.2 45.8…
  38. February 2020 Investor Presentation – Consol Energy Inc. – slide 38
    Average Cash Margin and Average Cost per Ton Sold Reconciliations (MM except per ton data) 4Q19 4Q18 Total Coal Revenue 304 348 Operating and Other Costs 230 246 Less: Other Costs (Non-Production) (25) (32) Total Cash Cost of Coal…
  39. February 2020 Investor Presentation – Consol Energy Inc. – slide 39
    CMT Adjusted EBITDA Reconciliation CMT EBITDA Reconciliation 4Q19 4Q18 Net Income 8.6 8.8 Plus: Interest Expense, net 1.5 1.5 Depreciation, Depletion and Amortization 1.2 0.9 EBITDA 11.3 11.2 Plus: Stock/Unit-Based Compensation…

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