WHITEHAVEN COAL LIMITED 30 October 2015
The Manager, Listings Australian Securities Exchange
Company Announcements Office
Dear Sir,
Via ASX Online
We attach copies of the Chairman's Address and Managing Director's Presentation which will be delivered at the Company's Annual General Meeting being held at 10:00am today.
Yours faithfully
Timothy Burt Company Secretary
Whitehaven Coal Limited ABN 68 124 425 396
Level 28, 259 George Street, Sydney NSW 2000
Tel: +61 2 8507 9700 Fax: +61 2 8507 9701
www.whitehavencoal.com.au
WHITEHAVEN COAL 2015 AGM - CHAIRMAN'S ADDRESS
Despite difficult external market conditions, Whitehaven Coal can look back on the year as one of strong progress and achievement. We have delivered significant operational and financial achievements. As a result, the Company is well-placed to continue our journey towards becoming one of Australia's largest, and lowest- cost, producers of high-quality coal.
In my report last year I described the importance of FY2015 in the Company's growth. I am pleased to report to shareholders that Whitehaven, led by CEO and Managing Director Paul Flynn, has delivered not just on our aspirations but also on all the hard targets we set twelve months ago.
A significant highlight this year has been delivering first coal from our new world-class Maules Creek asset - which is capable of producing 12 million tonnes of coal per annum for over 30 years. The Maules Creek project was delivered ahead of schedule and below budget - not a common feat in recent Australian construction history.
At Narrabri, our underground mine set several production records during the year and is quickly becoming one of the most productive and efficient underground longwall mines in Australia.
Supported by our open-cut operations, we are well-placed to achieve our longstanding target of 23Mtpa by FY2018.
Financially, the Company has adapted well to the significant headwinds in the industry. During the year, the Company reduced costs, returned to profitability in the second half and established a new debt facility on more favourable terms.
A very pleasing aspect of FY2015 has been the discipline with which the management team has reduced costs and driven efficiencies. These achievements, reflect well on the high quality management team we have assembled who are establishing Whitehaven as a global industry leader.
The operational achievements of FY2015 take on added importance in light of the difficult external market conditions.. Amid continued softness in coal pricing, a 17% increase in production to 15.8Mt ROM translated to revenue of $763.3 million in FY2015 - just ahead FY2014. The Company reported a loss before significant items of $10.7 million for the year, but importantly a profit of $1.7 million before significant items was reported for the second half.
Chairman's Address AGM Page 1 of 3
The full year net loss after tax was $342.7 million, which included an after tax significant item loss of $332.0 million. Significant items included the de-recognition of deferred tax balances resulting from the enactment of legislation repealing the MRRT and some writedowns of exploration tenements.
Importantly, operating EBITDA before significant items increased by 44% to $130.2 million. The Company is conservatively geared at 25% at 30 June 2015 and is positioned to delever at the bottom of the cycle as Maules Creek increases production in the years ahead.
While the net loss after tax result is disappointing, it reflects external conditions over which the Company has little or no control. From the Board's perspective, the management imperative in such an environment is to tighten control over costs and productivity and extract the best price possible for the quality coal we sell. Senior management deserves credit for executing so well against this imperative.
Despite the difficult market conditions at present, shareholders have reason to be upbeat about Whitehaven's prospects over the short to medium term. With Narrabri performing strongly and Maules Creek now declared commercial, increasing production and cash flows in the coming months and years will make Whitehaven one of Australia's largest, and lowest-cost, producers of high quality coal.
It is increasingly obvious from the contact the Board and senior management have had with our Asian customers that the global shift to cleaner, more efficient coal is underway and irreversible. Governments, including China, requiring their industries to source higher-energy, higher-quality, cleaner coal. This plays to the strengths of the Australian industry generally, and to Whitehaven in particular.
Whitehaven already produces a high-quality thermal product with low levels of ash, sulphur, phosphorous and other trace elements. Maules Creek will increase the proportion of higher-value PCI coal and semi-soft coking coal we sell, giving us diversification in product exposure and enhanced flexibility in global markets.
As a 23Mtpa producer, with approvals in place at Vickery to expand by an additional 4.5Mtpa, Whitehaven is ideally placed to participate in this growth.
Whitehaven takes great pride in our long-standing links with the local townships of Narrabri, Gunnedah and Boggabri where we operate. With the majority of our expanding workforce living in these communities, Whitehaven brings jobs, services and investment to the region in which we operate. The Company intends to open a new office in Gunnedah this year, deepening our ties with the community.
Pleasingly, the Company increased its total spend with suppliers and businesses in the region over the year to nearly $215 million. The total spend with local businesses over the past three years across the Gunnedah, Narrabri, Tamworth and Liverpool Plains region was $572 million. We are grateful for the role local communities have played in Whitehaven's success to date and we do not take this support for granted.
Chairman's Address AGM Page 2 of 3
Rick Gazzard retired as a non-executive director, in July 2015. The Board would like to thank Rick for his significant contribution to the Company during the three years he served as a Director and wish him well in his retirement. During his time on the Board, Rick made a strong contribution to a number of significant milestones for the Company including the ramp up in production at our Narrabri underground operation and the development of our world-class Maules Creek asset.
Dr Julie Beeby joined the Board as an independent director in July 2015. Julie has enjoyed a strong career in the coal industry and we believe she will add significant skills and insight to the Company as we continue on our path towards becoming Australia's leading independent coal Company. We welcome Julie to the Board.
In closing, I would like to thank shareholders for their support and commitment. I would also like to take this opportunity to thank my colleagues on the Board and the management team for their hard work and support over the past year. I can't let the opportunity pass without extending my sincere gratitude to Whitehaven's
entire workforce for their contribution to the Company in a challenging year. Our future is assured by the quality people we have operating at the coal face every day.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Michael Van Maanen - Media Ian McAleese - Investor Relations
M: 0412 500 351 T: 61 2 8507 9714 M: 61 427 227 530
E: Michael.vanmaanen@newgatecomms.com.au E: imcaleese@whitehavencoal.com.au
Chairman's Address AGM Page 3 of 3
|
distributed by
|
