Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - SunCoke Energy, Inc. | d419419d8k.htm |
 Credit Suisse
Global Credit Products
Conference
October 2012
Exhibit 99.1 |
 Mark
Newman Senior Vice President &
Chief Financial Officer |
    Safe Harbor
Statement Safe Harbor Statement
Some of the information included in this presentation contains “forward-looking
statements” (as defined in Section 27A of the
Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as
amended). Such forward-looking statements are based on management’s beliefs
and assumptions and on information currently available. Forward-looking statements
include the information concerning SunCoke’s possible or assumed future results of operations, the planned Master
Limited Partnership, business strategies, financing plans, competitive position, potential
growth opportunities, potential operating performance improvements, the effects of
competition and the effects of future legislation or regulations. Forward-looking
statements include all statements that are not historical facts and may be identified by the
use of forward-looking terminology such as the words “believe,”
“expect,”
“plan,”
“intend,”
“anticipate,”
“estimate,”
“predict,”
“potential,”
“continue,”
“may,”
“will,”
“should”
or the negative of these terms or similar expressions. Forward-looking statements involve
risks, uncertainties and assumptions. Actual results may differ materially from those
expressed in these forward-looking statements. You should not put undue reliance on
any forward-looking statements. In accordance with the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, SunCoke has included in its filings
with the Securities and Exchange Commission cautionary language identifying important factors (but not necessarily all the
important factors) that could cause actual results to differ materially from those expressed
in any forward-looking statement made by SunCoke. For more information concerning
these factors, see SunCoke's Securities and Exchange Commission filings. All
forward-looking statements included in this presentation are expressly qualified in their
entirety by such cautionary statements. SunCoke does not have any intention or
obligation to update publicly any forward-looking statement (or its associated cautionary
language) whether as a result of new information or future events or after the date of this
presentation, except as required by applicable law.
This presentation includes certain non-GAAP financial measures intended to supplement, not
substitute for, comparable GAAP measures. Reconciliations of non-GAAP financial
measures to GAAP financial measures are provided in the Appendix at the end of the
presentation. Investors are urged to consider carefully the comparable GAAP measures and the reconciliations to those
measures provided in the Appendix, or on our website at www.suncoke.com.
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 About
SunCoke About SunCoke
Largest independent producer of
metallurgical coke in the Americas
Coke is an essential ingredient in blast
furnace production of steel
Cokemaking business generates
~85% of Adjusted EBITDA
(1)
5.9 million tons of capacity in six
facilities; 5 in U.S. and 1 in Brazil
2012 U.S. coke production is expected
to be in excess of 4.3 million tons
Coal mining operations represents
~15% of Adjusted EBITDA
(1)
High quality mid-vol. metallurgical coal
reserves in Virginia and West Virginia
2012 coal production expected to be
1.6 million tons
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(1)
For a definition and reconciliation of Adjusted EBITDA, please see appendix.
|
 Blast Furnaces
and Coke 5
1 short ton
of hot metal (NTHM)
Top Gas
CS Global Credit Conference -
October 2012
Blast furnaces are the most
efficient and proven method
of reducing iron oxides
into liquid iron
Coke is a vital material to
blast furnace steel making
We believe stronger, larger
coke is becoming more
important as blast furnaces
seek to optimize fuel needs
BEST IN CLASS in lbs/ST
Iron
burden
Iron ore/
pellets
Scrap
3100
198
30
600
Flux
Fuel
Coke
Limestone
BEST IN CLASS in lbs/ST
Fuel
Nat Gas
Coal
Up to
80-120
Up to
120-180
Most efficient blast
furnaces require
800-900 lbs/NTHM
of fuel to produce
a ton of hot metal |
 More than
doubled capacity since 2006 with four new plants
Only company to design, build and
operate new greenfield developments
in U.S. in more than a decade
Supply about 20% of U.S. and Canada
coke needs
(1)
Secure, long-term take-or-pay
contracts with leading steelmakers
Customers include ArcelorMittal, U.S.
Steel and AK Steel
Cokemaking operations are
strategically located in proximity to
customers’
facilities
The Leading Independent Cokemaker
The Leading Independent Cokemaker
SunCoke
Cokemaking Capacity
(In thousands of tons)
6
(1)
Source: Company estimates
2006
2007
2008
2009
2010
2011
Jewell Coke
(Virginia)
Indiana Harbor
(Indiana)
Haverhill I
(Ohio)
Vitória
(Brazil)
Haverhill II
(Ohio)
Granite City
(Illinois)
Middletown
(Ohio)
2,490
4,190
4,740
5,390
5,390
5,940
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 SunCoke’s
Heat Recovery SunCoke’s Heat Recovery
Cokemaking Technology
Cokemaking Technology
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Industry leading environmental
signature
Leverage negative pressure
technology to substantially reduce
hazardous emissions
Convert waste heat into steam
and electrical power
Generate about 9 MW of electric
power per 110,000 tons of
annual coke production
Meet stringent U.S. EPA
Maximum Achievable Control
Technology standard
Traditional by-product cokemaking
methods have significant
environmental impacts |
 SunCoke’s
Value Proposition SunCoke’s Value Proposition
Provide an assured supply of coke to steelmakers
Larger, stronger coke for improved blast furnace performance
Demonstrated sustained 15% -
20% turndown capability
High quality coke with cheaper coal blends
–
Burn
loss
vs.
by-product
Capital preservation and lower capacity cost per ton;
particularly relative to greenfield investment
Stringent U.S. regulatory environment
Power prices and reliability versus value of coke oven gas and
by-product "credits"
High Quality
& Reliable
Coke Supply
Turndown
Flexibility
Coal
Flexibility
Capital
Efficiency
& Flexibility
Environment
/Economic
Trade-offs
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8 |
 Key Contract
Provisions Key Contract Provisions
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Take-or-Pay
Fixed Fee
Coal Cost
Operating
Costs
Transportation
& Taxes
–
We are obligated to deliver a minimum quantity of coke annually
Represents profit and return on capital
Customers must take all our production up to a maximum or
pay contract price for amount not taken
–
Fixed fee is fixed for life of contract
Cost of coal is passed-through subject to achieving a
contracted coal-to-coke yield standard
Operating costs are passed-through based on annually
negotiated budget or a fixed budget adjusted for inflation
These costs are passed-through |
    Master Limited
Partnership Master Limited Partnership
Filed S-1 on August 8, 2012
–
Amended S-1 on September 14, 2012
Expected Assets/Structure
–
At closing of offering, MLP expected
to own approximately a 60% interest
in Haverhill and Middletown
–
SXC to own General Partner, incentive
distribution rights and a portion of
the partnership units
Proceeds to SXC
–
Expected uses will include paying
down debt, funding expansion and
other general corporate purposes
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Middletown Operations
Haverhill Operations |
    Q1 & Q2 2012
Earnings Overview Results driven by strong Coke business
performance
Middletown startup has been a success
Continued improvement at Indiana Harbor
Strong operations at other facilities
Coal action plan progressing
Difficult demand/price environment
Taking action to reduce high cash
production costs
Achieved improved sequential quarter
performance
Strong liquidity position
Generated $66 million of free cash flow
(2)
in
first half 2012
Cash balance of $190 million and virtually
undrawn revolver of $150 million
(1)
For a definition and reconciliation of Adjusted EBITDA, please see the appendix.
(2)
For a definition and reconciliation of free cash flow, please see the appendix.
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$0.17
$0.24
$0.32
$0.32
2011
2012
Q1
Q2
Earnings Per Share
(diluted)
$26.6
$55.8
$37.7
$65.5
2011
2012
Q1
Q2
Adjusted EBITDA
(1)
(in millions) |
 Domestic Coke
Business Summary Domestic Coke Business Summary
(Jewell Coke & Other Domestic Coke)
(Jewell Coke & Other Domestic Coke)
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(Tons in thousands)
($ in millions, except per ton amounts)
(1)
For a definition of EBITDA and Adjusted EBITDA/Ton and reconciliations, please see the
appendix. (2)
Includes Indiana Harbor contract billing adjustment of $6.0 million, net of NCI, and
inventory (3)
Includes a $2.4 million, net of NCI, charge related to coke inventory reduction and a $1.3
million, net of NCI, lower cost or market adjustment on pad coal inventory and
lower coal-to-coke yields related to the startup at Middletown.
Strong performance driven by Middletown, Indiana Harbor and other operations
/Ton
/Ton
/Ton
(3)
/Ton
(2)
Domestic Coke Adjusted EBITDA
(1)
Per Ton
Domestic
Coke
Production
adjustment of $6.2 million, net of NCI, of which $3.1 million is attributable to Q3 2011. |
    Coal Mining
Financial Summary Coal Mining Financial Summary
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Coal Mining
Adjusted
EBITDA
(1)
and
Avg.
Sales
Price/Ton
(2)
Cash production costs increasing in face of
difficult demand/price environment
Pricing up modestly, reflecting strong mid-vol.
pricing/volumes, offset by weak hi-vol. and thermal
pricing/volumes
Cash costs up $11/ton, reflecting decreased mix and
higher costs of hi-vol. and thermal production
Coal action plan implemented in Q1 2012
gaining traction
Focus on most productive mines to reduce costs
delivered sequential quarter improvement
Cash cost per ton at Jewell decreased from
$161 in Q1 2012 to $143 in Q2 2012
Jewell reject rates improved from 68% in Q1
2012 to 66% in Q2 2012
Expect further cash cost reductions for 2013
Intend to maintain cash neutral position in
2012
Reduced capital spending in line with outlook
Coal Sales, Production and Purchases
-$50
$0
$50
$100
$150
Q2 '11
Q3 '11
Q4 '11
Q1 '12
Q2 '12
Coal Sales
334
371
363
373
365
Coal Producton
340
340
349
375
401
Purchased Coal
24
22
20
19
4
-$50
$0
$50
$100
$150
$200
($ in millions, except per ton amounts)
$11
$9
$2
$7
$9
$162
$155
$159
$171
$169
$34
$25
$20
$20
$25
$126
$132
$138
$151
$137
-$50
$0
$50
$100
$150
$200
Q2 '11
Q3 '11
Q4 '11(3)
Q1 '12
Q2 '12
Coal Adjusted EBITDA
Average Sales Price
Coal Adj EBITDA / ton
Coal Cash Cost / ton
(1)
For a definition and a reconciliation of Adjusted EBITDA, please see the appendix.
(2)
Average Sales Price is the weighted average sales price for all coal sales volumes, including
sales to affiliates and sales to Jewell Coke.
(3)
Q4 2011 Adjusted EBITDA inclusive of Black Lung Liability charge of $3.4 million and
OPEB expense allocation of $1.8 million. |
    First Half 2012
Sources & Uses of Cash First Half 2012 Sources & Uses of Cash
14
Liquidity position and credit metrics improving;
free
cash
flow
(1)
was
$66
million
in
first
half
2012
($ in millions)
(1)
For a definition and reconciliation of free cash flow, please see appendix.
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$127.5
$40.6
$38.6
$10.0
$0.3
$190.0
($2.8)
($20.7)
($3.5)
Q4 2011
Cash
Balance
1H 2012
Net Income
Depreciation,
Depletion &
Amortization
Deferred
Taxes
Changes in
Working
Capital
Other
Capital
Expenditures
Cash used in
financing
activities
Q2 2012
Cash
Balance |
    2012 Adjusted
EBITDA 2012 Adjusted EBITDA
(1)
(1)
Outlook
Outlook
($ in millions)
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(1)
For a definition of Adjusted EBITDA and reconciliation of Adjusted EBITDA, please see the
appendix. Strong U.S. cokemaking business expected to
2011
Adjusted
EBITDA (1)
Coke Business
Coal Mining
Corporate
Costs
Estimated
2012 Adjusted
EBITDA (1)
drive
increase
in
Adjusted
EBITDA
in
2012
$141
$95 -
$110
$5 -
$15
$9 -
$14
$250 -
$280
(1) |
    Strategies for
Enhancing Shareholder Value Strategies for Enhancing Shareholder Value
16
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Operational
Excellence
•
Maintain focus on details
and discipline of coke and
coal mining operations
•
Sustain and enhance top
quartile safety
performance and ability to
meet environment
standards
•
Leverage operating know-
how and technology to
continuously improve
yields and operating costs
Grow The Coke
Business
•
U.S. & Canada
Continue permitting
efforts for next potential
U.S. facility
•
Explore opportunities to
make strategic
investments in existing
capacity
•
International
•
Execute India entry and
pursue follow-on growth
Strategically Optimize
Assets
•
Coke MLP
•
Execute plan to place a
portion of our
cokemaking assets into
an MLP structure
•
Coal
•
Optimize operations and
investments to enhance
long-term strategic
flexibility
• |
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Source: CRU, The Annual Outlook for Metallurgical Coke 2012.
Replace aging coke batteries operated by integrated steel producers
Source: CRU, The Annual Outlook for Metallurgical Coke 2012
51% of coke capacity is at facilities >30 years old
U.S. and Canada Opportunity
U.S. and Canada Opportunity
17
Total 2011 Coke Demand: 19.5 million tons
Integrated
Integrated
Steel
Steel
Producers
Producers
63%
63%
SunCoke
18%
DTE
5%
Other Merchant
Other Merchant
& Foundry
& Foundry
6%
6%
Imports
Imports
8%
8%
Average Age
%
of U.S. & Canada
coke production
9
37
27%
24%
Aging Cokemaking Facilities
SunCoke
U.S. &
Canada
(excl SXC)
30-40 years
40+ years
U.S. & Canada Coke Supply |
    Coke Price
Comparison Coke Price Comparison
18
SunCoke’s coke is competitive on price, quality and reliability, providing us the
opportunity to displace imported coke
Source:
World
Price
(DTC),
Coke
Market
Report,
CRU
and
company
estimates
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U.S. and Canada Coke Imports
Representative
Delivered
Coke
Prices
-
$/ton
Chinese 40% Export Tax Premium (Tariff)
Chinese Coke Price
SunCoke Price -
Contracted Coal Price Differential
SunCoke Coke Price @ Spot Coal Price
1
Includes approx. $50/ton freight and approx. $40/ton handling loss
for shipping to Great Lakes region
2
Includes approx. $45/ton freight and approx. $30/ton handling loss
for shipping to Great Lakes region
$348
$48
$331
$402
$127
Other Domestic Coke
Ukrainian
Coke (2)
Chinese
Coke (1)
$396
$331
4.5
4.8
3.2
5.2
0.9
2.0
2.0
2.0
1.8
1.6
1.5
1.7
Imports
SunCoke sales volumes
2005
2006
2007
2008
2009
2010
2011
2012E
2013E
2014E
2015E
2016E
Based on July 2012 prices
$529 |
 Sources: CRU, The Annual Outlook for
Metallurgical Coke 2011, CIA World Factbook.
India Opportunity
India Opportunity
19
India
India
Steel/Coke
Steel/Coke
Market
Market
•
•
Committed to
Committed to
India entry
India entry
strategy
strategy
–
–
Discussing
Discussing
opportunities in
opportunities in
India
India
–
–
Targeting
Targeting
potential entry by
potential entry by
early 2013
early 2013
Growing Steel
Market
Coke supply
Deficit
Active
Merchant
Market
Electric Power
Deficit
Projected to be 3rd largest
steel market by 2020
Blast furnace to play a critical
role in growth
Importing approximately
2 million tons annually
Coke capacity investment lags
steel investment
3.5 million tons merchant
production or 13% of total
17 active merchant
coke producers
10% -
20% short power
Average wholesale price >$80
mwh (2x U.S. rate)
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 QUESTIONS
QUESTIONS
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20 |
 Appendix
|
    Definitions
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• Adjusted EBITDA represents earnings before interest, taxes, depreciation,
depletion and amortization (“EBITDA”) adjusted for sales discounts and the
deduction of income attributable to non-controlling interests in our Indiana Harbor
cokemaking operations. EBITDA reflects sales discounts included as a reduction in sales and other
operating revenue. The sales discounts represent the sharing with our customers of a portion
of nonconventional fuels tax credits, which reduce our income tax expense. However, we
believe that our Adjusted EBITDA would be inappropriately penalized if these discounts
were treated as a reduction of EBITDA since they represent sharing of a tax benefit
which is not included in EBITDA. Accordingly, in computing Adjusted EBITDA, we have added back
these sales discounts. Our Adjusted EBITDA also reflects the deduction of income attributable
to noncontrolling interest in our Indiana Harbor cokemaking operations. EBITDA and
Adjusted EBITDA do not represent and should not be considered alternatives to net
income or operating income under United States generally accepted accounting principles
(GAAP) and may not be comparable to other similarly titled measures of other businesses.
Management believes Adjusted EBITDA is an important measure of the operating performance of
the Company’s assets and is indicative of the Company’s ability to generate
cash from operations. •
Adjusted EBITDA/Ton
represents Adjusted EBITDA divided by tons sold.
•
Free Cash Flow
equals cash from operations less cash used in investing activities less cash distributions to
non- controlling interests. Management believes Free Cash Flow information
enhances an investor’s understanding of a business’
ability to generate cash. Free Cash Flow does not represent and should not be
considered an alternative to net income or cash flows from operating activities as
determined under GAAP and may not be comparable to other similarly titled measures of
other businesses. |
    Reconciliations
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$ in millions
Q2 2012
Q1 2012
FY 2011
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Adjusted Operating Income
46.6
37.1
80.4
14.9
33.5
24.6
7.4
Net Income (Loss) attributable to Noncontrolling Interest
1.3
(0.3)
(1.7)
(0.5)
3.4
1.6
(6.2)
Subtract: Depreciation Expense
(20.2)
(18.4)
(58.4)
(16.0)
(14.7)
(14.7)
(13.0)
Adjusted EBITDA
65.5
55.8
140.5
31.4
44.8
37.7
26.6
Subtract: Depreciation, depletion and amortization
(20.2)
(18.4)
(58.4)
(16.0)
(14.7)
(14.7)
(13.0)
Subtract: Financing expense, net
(11.8)
(12.0)
(1.4)
(7.1)
(3.3)
4.5
4.5
Subtract: Income Tax
(7.0)
(5.3)
(7.2)
2.9
(5.1)
(1.9)
(3.1)
Subtract: Sales Discount
(3.8)
(3.2)
(12.9)
(3.2)
(3.5)
(3.1)
(3.1)
Add: Net Income attributable to NCI
1.3
(0.3)
(1.7)
(0.5)
3.4
1.6
(6.2)
Net Income
24.0
16.6
58.9
7.5
21.6
24.1
5.7
Reconciliations
from
Adjusted
Operating
Income
and
Adjusted
EBITDA
to
Net
Income |
    Reconciliations
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$ in millions, except per ton data
Jewell Coke
Other
Domestic
Coke
International
Coke
Jewell Coal
Corporate
Combined
Domestic
Coke
Q2 2012
Adjusted EBITDA
12.5
48.6
0.7
9.3
(5.6)
65.5
61.1
Subtract: Depreciation, depletion and amortization
(1.3)
(13.7)
(0.1)
(4.3)
(0.8)
(20.2)
(15.0)
Add (Subtract): Net (Income) loss attributable
to noncontrolling interests
1.3
1.3
1.3
Adjusted
Pre-Tax
Operating
Income
11.2
36.2
0.6
5.0
(6.4)
46.6
47.4
Adjusted EBITDA
12.5
48.6
0.7
9.3
(5.6)
65.5
61.1
Sales Volume (thousands of tons)
170
892
358
373
1,062
Adjusted EBITDA per Ton
73.5
54.5
2.0
24.9
57.5
Q1 2012
Adjusted EBITDA
15.0
40.1
0.1
7.4
(6.8)
55.8
55.1
Subtract: Depreciation, depletion and amortization
(1.3)
(12.6)
(0.1)
(4.1)
(0.3)
(18.4)
(13.9)
Add (Subtract): Net (Income) loss attributable
to noncontrolling interests
(0.3)
(0.3)
(0.3)
Adjusted Pre-Tax Operating Income
13.7
27.2
-
3.3
(7.1)
37.1
40.9
Adjusted EBITDA
15.0
40.1
0.1
7.4
(6.8)
55.8
55.1
Sales Volume (thousands of tons)
186
892
358
373
1,078
Adjusted EBITDA per Ton
80.6
45.0
0.3
19.8
51.1
Reconciliations from Adjusted EBITDA to Adjusted Pre-Tax Operating Income
|
    Reconciliations
25
$ in millions, except per ton data
Jewell Coke
Other
Domestic
Coke
International
Coke
Jewell Coal
Corporate
Combined
Domestic
Coke
Q4 2011
Adjusted EBITDA
10.6
21.3
10.2
2.5
(13.2)
31.4
31.9
Subtract: Depreciation, depletion and amortization
(1.2)
(10.6)
(0.1)
(3.7)
(0.4)
(16.0)
(11.8)
Add (Subtract): Net (Income) loss attributable
to noncontrolling interests
(0.5)
(0.5)
(0.5)
Adjusted
Pre-Tax Operating Income
9.4
10.2
10.1
(1.2)
(13.6)
14.9
19.6
Adjusted EBITDA
10.6
21.3
10.2
2.5
(13.2)
31.4
31.9
Sales Volume (thousands of tons)
166
837
295
363
1,003
Adjusted EBITDA per Ton
63.9
25.4
34.6
6.9
31.8
Q3 2011
Adjusted EBITDA
13.9
34.3
1.7
9.2
(14.3)
44.8
48.2
Subtract: Depreciation, depletion and amortization
(1.2)
(9.9)
-
(3.3)
(0.3)
(14.7)
(11.1)
Add (Subtract): Net (Income) loss attributable
to noncontrolling interests
3.4
3.4
3.4
Adjusted
Pre-Tax Operating Income
12.7
27.8
1.7
5.9
(14.6)
33.5
40.5
Adjusted EBITDA
13.9
34.3
1.7
9.2
(14.3)
44.8
48.2
Sales Volume (thousands of tons)
191
777
373
371
968
Adjusted EBITDA per Ton
72.8
44.1
4.6
24.8
49.8
Reconciliations from Adjusted EBITDA to Adjusted Pre-Tax Operating Income
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    Reconciliations
$ in millions, except per ton data
Jewell Coke
Other
Domestic
Coke
International
Coke
Jewell Coal
Corporate
Combined
Domestic
Coke
Q2 2011
Adjusted EBITDA
10.6
25.3
0.8
11.5
(10.5)
37.7
35.9
Subtract: Depreciation, depletion and amortization
(1.4)
(9.6)
(0.1)
(3.2)
(0.4)
(14.7)
(11.0)
Add (Subtract): Net (Income) loss attributable
to noncontrolling interests
1.6
1.6
1.6
Adjusted Pre-Tax Operating Income
9.2
17.3
0.7
8.3
(10.9)
24.6
26.5
Adjusted EBITDA
10.6
25.3
0.8
11.5
(10.5)
37.7
35.9
Sales Volume (thousands of tons)
170
757
412
334
927
Adjusted EBITDA per Ton
62.4
33.4
1.9
34.4
38.7
Q1 2011
Adjusted EBITDA
11.0
8.5
1.0
12.3
(6.2)
26.6
19.5
Subtract: Depreciation, depletion and amortization
(1.1)
(8.6)
-
(2.7)
(0.6)
(13.0)
(9.7)
Add (Subtract): Net (Income) loss attributable
to noncontrolling interests
(6.2)
(6.2)
(6.2)
Adjusted Pre-Tax Operating Income
9.9
(6.3)
1.0
9.6
(6.8)
7.4
3.6
Adjusted EBITDA
11.0
8.5
1.0
12.3
(6.2)
26.6
19.5
Sales Volume (thousands of tons)
175
697
362
386
872
Adjusted EBITDA per Ton
62.9
12.2
2.8
31.9
22.4
Reconciliations from Adjusted EBITDA to Adjusted Pre-Tax Operating Income
CS
Global
Credit
Conference
-
October
2012
26 |
  (in
millions) 2012E
Low
2012E
High
Net Income
$98
$122
Depreciation, Depletion and Amortization
74
72
Total financing costs, net
48
46
Income tax expense
25
37
EBITDA
$245
$277
Sales discounts
11
10
Noncontrolling interests
(6)
(7)
Adjusted EBITDA
$250
$280
Estimated EBITDA Reconciliation
2012E Net Income to Adjusted EBITDA Reconciliation
27
CS Global Credit Conference -
October 2012 |
    Free Cash Flow
Reconciliations 2012E Estimated Free Cash Flow Reconciliation
CS
Global
Credit
Conference
-
October
2012
28
(in millions)
1
st
Half
2012
Cash from operations
$ 86.7
Less cash used for investing activities
(20.7)
Less payments to minority interest
( -
)
Free Cash Flow
$ 66.0
(in millions)
2012
Cash from operations
In excess of
$ 189
Less cash used for investing activities
Approx.
(85)
Less payments to minority interest
Approx.
(4)
Free Cash Flow
In excess of
$ 100
First Half 2012 Free Cash Flow Reconciliation |
 Reference
|
    SunCoke’s
Cokemaking Technology SunCoke’s Cokemaking Technology
30
CS
Global
Credit
Conference
-
October
2012
Our industry-leading cokemaking technology meets
U.S. EPA Maximum Achievable Control Technology (MACT) Standards |
    Natural Gas in
The Blast Furnace Impact of Low Natural Gas Prices
Natural gas cannot completely replace
coke in blast furnace
–
We estimate natural gas and other
injectants can replace up to about 30%
–
The less coke used the more important
the coke’s quality
Alternative technologies take time to
implement, require significant capital
commitments and are energy intensive
Coke oven gases produced by
integrated steelmakers’
own coke
ovens is less valuable in low cost
natural gas environment, potentially
impacting steelmakers’
future
reinvest/rebuild decisions
Blast Furnace Fuel Pricing
31
Source: CRU, SXC Analysis
US$/MMBtu
CS
Global
Credit
Conference
-
October
2012 |