A Forbes & Manhattan Group Company Private and Confidential Investor Presentation March 2011 TSX:...
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Transcript of A Forbes & Manhattan Group Company Private and Confidential Investor Presentation March 2011 TSX:...
A Forbes & Manhattan Group CompanyPrivate and Confidential
Investor PresentationMarch 2011
TSX: FMC
2
Disclaimer
This presentation contains forward-looking statements under Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the development potential and timetable of the Magdelena and Aviemore projects; the Company’s ability to raise additional funds as necessary; the future price of coal; the estimation of mineral resources; conclusions of economic evaluation (including scoping studies); the realization of mineral resource estimates; the timing and amount of estimated future production, development and exploration; costs of future activities; capital and operating expenditures; success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental risks. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Estimates regarding the anticipated timing, amount and cost of mining at the Mali projects are based on assumptions underlying mineral resource estimates and the realization of such estimates; results of previous mining activities at the projects, and detailed research and analysis completed by independent consultants and management of the Company; research and estimates regarding the timing of delivery for long-lead items; knowledge regarding certain factors described in the technical report filed under the profile of the Company onSEDAR. Capital and operating cost estimates are based on results of previous mining activities, research of the Company and independent consultants. Production estimates are based on mine plans and production schedules, which have been developed by the Company’s personnel and independent consultants. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward looking statements, including but not limited to risks related to: timing and availability of external financing on acceptable terms; unexpected events and delays during construction, expansion and start-up; variations in ore grade and recovery rates; receipt and revocation of government approvals; actual results of exploration and mining activities; changes in project parameters as plans continue to be refined; future prices of coal; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statementsexcept in accordance with applicable securities laws.
Investors are advised that National Instrument NI 43-101 of the Canadian Securities Administrators (“NI 43-101”) requires that each category of mineral reserves and mineral resources be reported separately. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Cautionary Note to U.S. Investors Concerning Estimates of Measured, Indicated or Inferred ResourcesThe information presented uses the terms “measured”, “indicated” and “inferred” mineral resources. United States investors are advised that while such terms are recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize these terms. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or other economic studies. United States investors are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be converted into mineral reserves. United States investors are also cautioned not to assume that all or any part of an inferred mineral resource exists, or is economically or legally mineable.
3
Company Overview
Forbes & Manhattan Coal Corp.’s (“Forbes Coal” or the “Company”) vision is to build
a high quality bituminous and metallurgical coal company with potential capacity in excess of 10M t/year
Company Summary
Headquarters: Toronto, Ontario
Number of mines: 2 (Magdalena and Aviemore)
Mine location: Kwazulu Natal, South Africa
Total coal resource (NI 43-101): 54.2M t Bituminous, 47.1M t Anthracite1
Historical annual ‘run-rate’ production:
600kt t saleable tons
2012F target production: 900kt saleable Bituminous - Magdalena 160kt saleable Anthracite - Aviemore
Production capacity: 1.5M t saleable tons1. As set out in the Technical Report of the Company entitled “An Independent National Instrument 43-101 Technical Report on
Slater Coal and Subsidiaries, KwaZulu-Natal Province, South Africa”, dated April 30, 2010, prepared for the Company by Minxcon (the “Technical Report”). A copy of the Technical Report is available under the profile of the Company on SEDAR at www.sedar.com.
4
Delivering on Stated ObjectivesStated Goal Status Complete NI 43 – 101 technical report Completed Effective April 30, 2010 as issued
on July 20, 2010: 69% and 95% increase in bituminous and anthracite resource, respectively
Complete go public transaction Completed RTO within 60 days, began trading on the Toronto Stock Exchange under the symbol “FMC” effective September 27, 2010 (TSX:FMC)
Expand export port allocation Agreement with Grindrod port terminal for incremental capacity of up to 960,000 tonnes per annum over a three year period.
Deliver on organic growth strategy of selling 976kt of coal in FY2012
Magdalena new continuous miner arrived in December 2010 (further increases saleable production capacity by 330kt per annum)
Aviemore reopened in June 2010 and at full capacity
Other positive developments New management team on site Bituminous spot coal price approximately
US$120.00/t versus US$84.00/t during initial financing
5
EXPORT ALLOCATION UPDATE
Milestone agreement inked on December 7th increases export capacity from 197,000 to 1,157,000 tonnes per annum
Potential to Increase Throughput by 960,000 Tonnes and Cash Flows by Up to $30 Million Per Annum Over a Three Year Period
Highlights include: • Grindrod Terminals shall provide export capacity in the Terminal for the shipment of coal products as follows:
– 2011 – 600,000 metric tons (m/t) per annum – 2012 – 720,000 metric tons (m/t) per annum – 2013 – 960,000 metric tons (m/t) per annum
• Grindrod Terminals provides certain logistical, handling and stock piling services to shippers in connection with the shipment of bulk cargoes through the dry bulk coal Terminal known as the Navitrade Terminal (and its associated facilities), connected to berths in the Port of Richards Bay.
• • Grindrod Terminals will provide up to 70,000 t in stockpile capacity to receive the coal at the terminal. • • F&M can deliver coal to the Terminal either by road or rail. • • Forbes Coal entered into an agreement with TFR for the transport of the coal to the terminal in order to support the
throughput capacity
POSITIONED FOR MULTI –YEAR EXPORT GROWTH VIA RICHARDS BAY
6
Investment Highlights
Strategic assets in one of the best developed coal markets in the world
Substantial resource base of high quality bituminous and anthracite coal• Estimated total resource: 54.2M t bituminous and 47.1M t anthracite (+18.0 year life of mine)• Substantial exploration upside, with only 35% of land package explored
Ability to TRIPLE production from current levels using existing infrastructure and capacity
In-place infrastructure to reach export corridors and growing domestic market• Close to Richard’s Bay terminal, major export corridor for coal to European and Asian markets• Close to Durban, major coal and anthracite market
Producing Magdalena bituminous coal mine supported by excellent gross margins and strong free cash flow• Ramp-up moving ahead of schedule
Anthracite mine recently commissioned• Aviemore anthracite coal mine restarted in June, running at full capacity by end of October 2010
Substantial upside through organic production growth and opportunistic acquisitions• Organic growth through improvement in recoveries • Significant exploration upside• External growth through opportunistic acquisitions in fragmented South African market
Coal-focused management team sponsored by Forbes & Manhattan
7
Experienced Management TeamStephan Theron, B.Comm, CGA │President and Chief Executive Officer Extensive management, project finance and equity analysis experience in the mining, energy and infrastructure sectorsPrevious capital and project experience includes Weir PLC and AMEC PLCFormer sector head materials and energy with a specific focus on South African coal market
Johan Louw, P. Eng. │Vice President, Africa Operations & acting Chief Operational OfficerCapital project specialist with over 15 years experience in the Southern African mining and energy sectorsFormer project manager for Weir PLC and KBR Inc.Former senior plant metallurgist for Anglo Coal covering numerous export focused coal mines
Kuda Muchenje M.Geo │VP Exploration & DevelopmentSeasoned exploration geologist with over 15 years experience in the generation of exploration targets and management of exploration and evaluation programmesOperating experience in South Africa, Mozambique and Zimbabwe
Deb Battiston, CGA. │Chief Financial OfficerFinancial specialist with over 20 years experience in the mining sector
Jennifer Wagner LLB. │Corporate SecretaryCorporate securities lawyer who has worked as a legal consultant to various TSX and TSX Venture listed companies in the mining industry.
Bob Bentley, │Mining ManagerFormer Mine Inspector in KwaZuluNatalOver 30 year of Mining management experience
8
Directors
Stan Bharti, P.Eng. │Executive ChairmanBusiness consultant and a professional mining engineer with more than 25 years experience President of Forbes & Manhattan, Inc., a private merchant bank operating in Canada, the U.S. and Western Europe, since July 2001
Stephan Theron : President and CEO
David Stein, MSc., CFA │DirectorOver nine years of asset evaluation, research and corporate finance experiencePresident and Director of Aberdeen International (seed investor in Forbes Coal)
Grant Davey, P. Eng. │DirectorMining Engineer with close to 20 years experience in coal, platinum and gold mining industryPreviously held senior operational management roles for Anglo American in South Africa & Australia
David Gower, P. Geo. │DirectorProfessional Geologist and the former Global Head of Nickel Exploration for Falconbridge
Ryan Bennett, M.Mining Eng│DirectorMasters degree in Mining Engineering from the Colorado School of Mines Extensive technical mining project analyses experience Senior Partner of Resource Capital Fund
9
Historical Coal Prices
• South African thermal coal (Richard’s Bay terminal) and coking coal prices have increased significantly over the last several months
• The recovery to 2008 levels have been driven by increased demand, particularly from China and India, and higher cost supply from key producing nations such as Russia and the U.S.
Historical South African Thermal Coal and PCI Coal Prices
$0
$50
$100
$150
$200
$250
$300
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07
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-07
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-07
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7
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07
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-07
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08
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-08
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-08
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8
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08
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-08
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09
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-09
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-09
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-09
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10
Mar
-10
May
-10
Jul-1
0
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(US$/t
onne)
Richards Bay Thermal Coal Spot Price McCloskey/Xinhua Infolink's Coking Coal Price
Source: Bloomberg
10
Established Mining Region
Source: Company reports
11
Mining Resource
NI 43 – 101 Global Resource1
1. As set out in the Technical Report of the Company available on the SEDAR profile of the Company at www.sedar.com.
2. Exclusive of reserves
• Recently completed NI 43 – 101 technical report calls for +18.0 year weighed life of mine (“LOM”)
P&P M&I Inferred MI&I
Magdalena - Bituminous 24.6 54.2 54.2
Aviemore - Anthracite 8.0 35.9 16.9 52.8
Total 32.6 90.1 16.9 107.0
12
South Africa – Overview
• Ranked best country to do business in Africa by Forbes.com in 2009
• Modern infrastructure system supporting distribution of commodities for both domestic and export markets
– Extensive rail network (10th longest in the world)
– Majority of electricity generated via coal fired power stations
– Richard’s Bay port in South Africa is the world’s largest bulk coal terminal
• 91M t capacity• Coal railed from approximately
49 mines
• Long history in resource development
– World’s largest PGM & ferrochrome producer
– Significant coal, iron ore and manganese resources
Richard’s Bay PortWorld’s Largest Coal Terminal
13
Magdalena Bituminous Coal Operations
14
Domestic66%
Export34%
South African Bituminous Coal Market• Forbes Coal sells its high quality bituminous coal directly to independent
industrial companies in South Africa (US$40 – US$50/t premium on coal)– Forbes Coal’s domestic sales are at market prices (approximately US$80/t)
compared to low quality coal sold to state-controlled power utility Eskom (sells at US$20/t-US$30/t)
• Forbes Coal also sells its bituminous coal to export markets through the Richard’s Bay port
– Targeting export markets in India and Europe• South African exports to India increased from 8.4M t in 2008 to 22.0M t in
2009• South Africa has historically been a major supplier to Europe given
significantly lower shipping prices compared to major exporting countries such as Australia and Indonesia
Magdalena Sales Mix (2010E)• Significant upside potential to export prices
– Richards Bay bituminous coal spot price of US$130/t is significantly below 2008 highs of US$177/t
– Robust import demand from India– Growing imports into China due to increasing
demand and production curtailments– Slowing export supply growth from Indonesia
as more coal is diverted for domestic use– Short-term supply constraints caused by
flooding in Australia• Australia is the second-largest exporter
of bituminous coal• Wood Mackenzie stated that prices could
exceed 2008 highs
15
Growing Bituminous Coal Demand from China and India
China and India Bituminous Coal Imports2
• Expecting continued strong demand for bituminous coal imports from both China and India
– Chinese coal supply limited by domestic production, infrastructure constraints from Inner Mongolia and domestic power generation growth
– Indian demand being driven by construction of new coal fired power stations– In 2004, Chinese net exports of thermal coal were 71M t. From December 2009 to November
2010 net imports were 39M t, a swing of 110M tpa in a global market of about 700M tpa1
• Richard’s Bay bituminous coal exports to Asia have grown 237% since 2008, making Asia the largest bituminous coal export market for South African coal
1. Chinese trade data, Canaccord Genuity Research2. Source: December 2010 Xstrata presentation3. Richard’s Bay Terminal, Canaccord Genuity Research
2008 2009 2010(M tonnes) (M tonnes) (M tonnes)
Asia 11.1 25.1 37.4China presumed low presumed low 7.0India 6.8 17.7 20.3
Europe 38.9 28.1 15.9Thermal coal exports 61.7 61.1 63.4
Richard’s Bay Terminal Bituminous Coal Exports3
0
20
40
60
80
100
120
140
160
180
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1996
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Bit
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India China
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16
Magdalena Bituminous Coal Operations
Location: • Dundee KwaZulu Natal
Coal Type: • Bituminous
Resource: • 54.2mt
Acres: •4,550 (2,750 acres resource)
Average BTU:
• 12,250 BTU/lb• 6,800 kcal/kg
Ash: • 15.0%
Volatility: • 16.7%
Saleable Production:
• 2011FY2: 600,500t• 2012FY2: 900,000t
Mine Life: • Approximately 20 years
Infrastructure:
• Wash plant, processing plant and siding
Asset Summary1
1. Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
2. Fiscal year-end February 28
Magdalena Operations and Site Layout
17
Magdalena Bituminous Coal Production Profile
• Ramp-up on schedule• New continuous miner arrived in December (further increase
saleable production capacity by close to 30,000 tonnes per month)
Magdalena Saleable Bituminous Coal Production1
299 347 326
449 485601
9001,003
857 856
2006 2007 2008 2009 2010 2011E 2012E 2013E 2014E 2015E
Magdalena - open pit Magdalena - underground
(000 t)/February 28 year-end
1. Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
18
Selected Magdalena Photographs
Source: Company reports
19
Aviemore Anthracite Coal Operations
20
China
72%
South Korea
10%
Europe
8%
Other
2%Japan
8%
Overview of Anthracite Coal Market• Background to anthracite coal
– Carbon-rich (70% to 85% carbon content), high quality coal with relatively high BTU (11,000-14,000 BTU) and low sulphur content (typically <1.8%)
– Cost-effective replacement for coking coal/coke
– Applications include iron ore pelletizing, PCI for blast furnaces, calcining for electrode manufacturing, ferroalloys and power generation
• Anthracite coal market1
– 2007 global production of 170-180M t, of which 50M t was exported by 6 countries
– Anthracite coal accounts for approximately 1% of the global coal market
– Asia dominates demand for anthracite coal• 83% of global imports• 95% of expected export demand growth
– Demand driven by the metal refining industry
– Relatively inelastic demand (no price-competitive substitutes)
– Constrained supply from major producers (Vietnam, Russia, Ukraine)
– Pricing highly correlated with PCI coal prices– Current European anthracite lump prices are
only 45% of European coke prices, compared to the historical ratio of 60-70%
Vietnam
60%Russia
13%
China
8%
Ukraine
8%
Other
11%
Anthracite Coal Exports/Imports (2009)1
Anthracite Coal Users by Industry
1. Source: Resource-net
Exports Imports
Domestic
• Iron & Steel (ArcelorMittal - large producer)
• Ferrochrome• FerroAlloys (Titanium)• Chemical• Heating
Export • Brazilian, Indian and European Steel manufacturers
21
South African Anthracite Coal Market• The South African anthracite coal domestic and export market has grown
significantly since 2000• Export market supported by well-established distribution networks
– Forbes Coal’s export anthracite coal production is to be sent through the world-class Durban port facility (shipped 25% of South Africa’s anthracite exports in 2008)
• Forbes Coal is one of only four major South African anthracite producers• Company is targeting anthracite sales to local, Brazilian, Asian & European
steel & metal producers
South Africa Anthracite Coal Sales1
1.6 1.51.2
1.0
1.41.2 1.4
2.62.8
2000 2001 2002 2003 2004 2005 2006 2007 2008
Domestic Sales Export Sales
(M t)
1. Source: Resource-net
Forbes Coal
Domestic Demand CAGR = 11.6%Export Demand CAGR = 4.5%
South African Anthracite Coal Producer Locations
22
Aviemore Anthracite Coal Operations
Location: • Dundee KwaZulu Natal
Coal Type: • Bituminous
Resource: • 47.1mt
Acres: •13,700 (3,780 acres resource)
Average BTU:
• 12,800 BTU/lb• 7,100 kcal/kg
Ash: • 13.7%
Volatility: • 7.9%
Saleable Production:
• 2011FY2: 52,000t• 2012FY2: 161,000t
Mine Life: • Approximately 20 years
Infrastructure:
• Wash plant, processing plant and siding
Asset Summary1
1. Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
2. Fiscal year-end February 28
Aviemore Operations
23
Aviemore Anthracite Coal Production Profile
• Calcine plant commissioned in August– First production in September, full capacity at end of month
• Annual production capacity expected to hit 500,000t of saleable coal per annum in FY2014
Aviemore Anthracite Coal Saleable Production1
(000 t)/February 28 year-end
59 62 61102
2052
161
420
504 504
2006 2007 2008 2009 2010 2011E 2012E 2013E 2014E 2015E
1. Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
24
Selected Aviemore Photographs
Source: Company reports
25
Company Outlook
26
Organic Growth Opportunities
Increase export allocation by close to 1M tonnes over three years
Acquired an additional continuous miner at Magdalena
• Double production• Total CAPEX requirement of US$3.0M -
$5.0M
Increase wash plant recovery rates• Improve from current level of 60% to 70%• Total CAPEX requirement of $2.0M-$3.0M• Investigate product upgrade potential• Determine marketability to PCI users
Restart Aviemore anthracite operations• Ramp-up saleable production to 500,000
t/year (represents US$20.0M in incremental EBITDA based on current forecasted price)
• Total CAPEX requirement of US$5.0MSource: Company reports
27
External Growth Opportunities
Source: Company reports
Target consolidation in area
• 6 mining operators estimated in the region
• 4 acquisition opportunities currently identified in KwaZulu Natal, South Africa
• Substantial enhanced upside by improving acquired business operating practices
• Increased export allocation and marketing advantage
• Synergy in product base and cost savings with central management team
28
2010 – 2015 Mine Plan
Saleable Production1
• Increasing production: saleable production is expected to grow at a CAGR of 22% from 2010 to 2015
– Driven by expansion of production from the Magdalena and Aviemore underground mines
505
653
1,061
1,4231,361 1,360
2010FY 2011FY 2012FY 2013FY 2014FY 2015FY
Bituminous Anthracite
(000 t)
1. Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.2. Company estimates year to date March 2010 to December 2010
COST ZAR/ ROM t Aviemore U/G Magdalena U/G Magdalena O/C Total
Run of Mine tonnes 117,179 411,352 215,184 743,715
Mining Cost 132 198 135 169
Transport Cost to Process plant 4 12 11 10
Processing Cost - Mag / plant - 33 - 18
Processing Cost - Coalfields 47 - 47 21
Calcine Costs 16 - 16 7
Overhead Cost 19 19 19 19
Total ZAR/t 217 262 227 245
Cost per ROM tonne YTD2
29
Capitalization and Share Performance
Company Ticker TSX: FMC
Closing Price (February 28, 2011) C$4.45
Trading Range Since September 27, 2010
C$2.65 – C$4.60
Basic Shares Outstanding 34.8 million
FD Shares Outstanding* 40.8 million
Market Capitalization (Basic) C$155 million
Market Capitalization (FD) C$181 million
Estimated Enterprise Value(Basic) C$135 million
* Includes 2,557,798 options with a weighted average exercise price of C$3.48 per share and a weighted average life of 4.5 years* Includes 763,887 broker warrants convertible into common shares at an exercise price of C$2.80 per share and expiring on January 23, 2012* Includes 2,700,00 performance warrants that convert into common shares upon the company reaching certain operating targets
Comparable Trading Analysis Share Performance
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
Sep
-10
Oct
-10
Nov
-10
Dec
-10
Vo
lum
e (m
illi
on
s)
$-
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
$4.50
$5.00
Pri
ce (
C$)
Volume Price
30
Comparable Trading Analysis
Market Cap EV Company (US$M) (US$M) 2011E 2012E 2011E 2012E
U.S. Coal ProducersAlpha Natural Resources $7,876 $7,970 7.0x 5.7x 9.4x 7.2xArch Coal $5,802 $7,278 6.7x 5.6x 8.5x 6.6xCloud Peak Energy $740 $1,428 4.0x 3.6x 3.6x 2.3xConsol Energy $11,586 $14,906 8.2x 6.2x 9.7x 7.6xInternational Coal Group $1,730 $1,926 6.2x 4.3x 7.4x 6.6xJames River Coal $706 $826 4.9x 5.1x 5.7x 10.9xMassey Energy $5,759 $6,654 7.0x 5.9x 7.9x 7.3xPatriot Coal $2,001 $2,262 7.6x 4.5x 6.5x 3.9xPeabody Energy $16,931 $18,585 7.4x 6.4x 9.8x 8.2xU.S. Coal Producers Average 6.6x 5.3x 7.6x 6.7x
African Coal ProducersCoal of Africa Limited $926 $910 6.0x 3.3x NA NAExxaro Resources $7,927 $8,341 8.8x 6.3x 7.2x 5.4xKeaton Energy $90 $90 4.3x 2.1x NA NAOptimum Coal $1,087 $1,138 4.8x 3.9x 3.8x 3.2xPetmin Limited $253 $222 4.7x 3.7x NA NARiversdale Mining $3,290 $2,765 44.6x 18.0x 48.8x 25.1xAfrican Coal Producers Average 12.2x 6.3x 20.0x 11.2x
Other Coal ProducersCline Mining $720 $718 15.8x 4.6x 18.5x 6.6xGloucester Coal $1,675 $1,655 12.2x 8.0x 17.3x 12.4xGrande Cache Coal $1,093 $1,098 6.8x 4.6x 7.1x 4.8xMacArthur Coal $3,965 $3,719 9.1x 7.3x 13.3x 10.6xWestern Coal $2,517 $2,447 4.4x 3.9x 4.4x 4.0xOther Coal Producers Average 8.1x 6.0x 10.5x 7.9x
Overall Average (excluding high and low) 6.8x 5.2x 8.4x 7.1x
Forbes Coal 119$ 160$ 2.8x 2.1x 2.8x 2.5xForbes Coal - Discount to Comparables (58%) (59%) (67%) (65%)
EV / EBITDA P/CFPS
Note: As of January 14, 2011• Riversdale Mining is shown pre-announcement of takeover offer by Rio Tinto Ltd. on December 6, 2010• Western Coal is shown pre-announcement of merger agreement with Walter Energy, Inc. on November 18, 2010Source: Consensus estimates and company reports
Comparable Trading Analysis
1
2
• Forbes Coal trades at a significant discount to comparable coal producers on an EV/EBITDA and P/CF basis