WWW.KEATONENERGY.CO.ZA
RESULTS FOR SIX MONTHS ENDED 30 SEPTEMBER 2013
Monday, 18 November 201310h00
1
2
MANDI GLADCHIEF EXECUTIVE OFFICER
WWW.KEATONENERGY.CO.ZA
LOCATION
3
OPERATIONS AND PROJECTSMoabsvelden
Vanggatfontein Colliery
National road
City
Town
Power station
Richards Bay coal line
Colliery
Project
Acquisition
Koudelager Project
Vaalkrantz Colliery
Braakfontein Project
Sterkfontein Project
WWW.KEATONENERGY.CO.ZA 4
HIGHLIGHTS
Good safety performance R205 million cash generated from operations
R117 million gross profit compared with a gross loss ofR38 million in 1HFY13
HEPS up 192%from (21.1) cps to 19.4 cps
R39 million debt repaid
70% increase in group revenue to R710 million
55% increase inEskom sales to 1.1Mt
Commenced developmentof Pit 4 at Vanggatfontein
Acquisition of Xceed Resources
WWW.KEATONENERGY.CO.ZA
SAFETY
VANGGATFONTEIN LTIFR VAALKRANTZ LTIFR
5
1HFY13 2HFY13 1HFY14
0.20
0.00
0.10
1HFY13 2HFY13 1HFY14
0.45
0.36
0.17
FATALITY FREE SINCE INCEPTION
* LTIFR per 200 000 man hours
WWW.KEATONENERGY.CO.ZA
VANGGATFONTEIN VAALKRANTZ
6
OPERATIONS
1HFY13 2HFY13 1HFY14
Sales (kt) 769 805 1 198
ROM (kt) 1 473 1 312 1 727
Revenue (Rm) 284 362 585
EBITDA (Rm) 36 62 269
Capex (Rm) 71 133 135
No. of employees* 406 416 486
1HFY13 2HFY13 1HFY14
Sales (kt) 151 175 154
ROM (kt) 285 266 228
Revenue (Rm) 133 139 125
EBITDA (Rm) 23 8 9
Capex (Rm) 7 0 2
No. of employees* 767 778 808
* Includes contractors
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GROWTH
WWW.KEATONENERGY.CO.ZA
SUSTAINABLE
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GROWTH PROFILE
2.40
5.36
2010 2011 2012 2013 2014 2015 2016
Mtpa saleable
2017 2018
LOM20 years
Vaalkrantz Colliery LOM 12 – 24 months
MoabsveldenProject
LOM18 years
BraakfonteinProject
LOM12years
Koudelager Project LOM 20 years2.752.86
4.26
VanggatfonteinColliery
WWW.KEATONENERGY.CO.ZA 9
XCEED ACQUISITION
» 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
RATIONALE
WWW.KEATONENERGY.CO.ZA 10
XCEED ACQUISITIONTIMELINE
18 Nov
18 Nov
24 Dec
16 Dec
Implementation Deed
Competition Commission Approval
Gunvor Subscription Agreement
Credit Approved Term Sheet
Submission of circular to JSE
SARB Approval
Post circular to shareholders
First Court Date
KEH shareholder meeting
Xceed Scheme meeting, announce results to ASX
Second Court Date, announce to ASX
Effective date- file court order with ASIC and
announce to ASX- Xceed securities cease trading at
close of trading on ASX
Record Date for entitlement toScheme Consideration
Implementation Date – KEH paysAggregate Scheme Considerationto Xceed
23 Jan
03 Feb
06 Feb
07 Feb
14 Feb
19 Feb
11
JACQUES ROSSOUWCHIEF FINANCIAL OFFICER
WWW.KEATONENERGY.CO.ZA
FINANCIAL
12
PERFORMANCE
EXTRACTS FROM THE STATEMENT OF COMPREHENSIVE INCOME (Rm) 1HFY14 1HFY13 % CHANGE FY13
Revenue 709.8 417.3 70% 918.8
Cost of Sales (592.6) (455.2) 30% (946.1)
* Cash cost (412.4) (374.5) 10% (726.3)
* Depreciation (183.1) (121.9) 50% (235.2)
* Inventory 2.9 41.2 (93%) 15.4
Gross profit/(loss) 117.2 (37.9) >100% (27.3)
Operating profit/(loss) 84.6 (69.9) >100% (139.4)
Income taxation (expense)/credit (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)
* From operational results
WWW.KEATONENERGY.CO.ZA
FINANCIAL
13
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)
Deferred stripping capitalised (134.7) (42.2)
592.6 455.2
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FINANCIAL
14
PERFORMANCE
GROSS PROFIT
1HFY13 2HFY13 1HFY14
-200
-100
0
100
200
300
400
500
600
700
-10%
-5%
0%
5%
10%
15%
20%
Reve
nue
(Rm
)
20%
0%
15%
10%
5%
-10%
-5%
GP %
(9%)
2%
17%
WWW.KEATONENERGY.CO.ZA 15
1HFY13 2HFY13 1HFY140
100
200
300
400
500
600
700
0%
5%
10%
15%
20%
25%
30%
35%
40%
FINANCIALPERFORMANCE
EBITDA
Reve
nue
(Rm
)
EBIT
DA %
12%9%
38%
*EBITDA excluding loss on de-recognition of asset in 2HFY13
WWW.KEATONENERGY.CO.ZA 16
1HFY11 1HFY12 1HFY13 1HFY14-25
-20
-15
-10
-5
0
5
10
15
20
25
1.7
8.4
FINANCIALPERFORMANCE
HEADLINE EARNINGS PER SHARE (CPS)
(21.1)
19.4
WWW.KEATONENERGY.CO.ZA
-280
-240
-200
-160
-120
-80
-40
0
-265
205
7
-6 -2
-143
-204
FINANCIAL
17
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
WWW.KEATONENERGY.CO.ZA 18
FINANCIALPERFORMANCE
PROPERTY, PLANT AND EQUIPMENT (Rm) 1HFY14 FY13
Stripping costs 155.9 109.9
Boxcut development 32.3 85.2
Mine development 260.2 253.1
Plant and equipment 184.3 195.0
Mine infrastructure 88.9 92.5
19
MANDI GLADCHIEF EXECUTIVE OFFICER
WWW.KEATONENERGY.CO.ZA 20
LOOKINGAHEAD
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 worth
WWW.KEATONENERGY.CO.ZA 21
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.