Investor Presentation
March 2011
TSX: FMC
A Forbes & Manhattan Group Company
Private and Confidential
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 forwardlooking 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 statements
except 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 Resources
The 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.
2
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 tons
1.
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.
3
Delivering on Stated Objectives
Stated 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
4
EXPORT ALLOCATION UPDATE
POSITIONED FOR MULTI –YEAR EXPORT GROWTH VIA RICHARDS BAY
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
5
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
6
Experienced Management Team
Stephan Theron, B.Comm, CGA │President and Chief Executive Officer
Extensive management, project finance and equity analysis experience in the mining, energy and infrastructure
sectors
Previous capital and project experience includes Weir PLC and AMEC PLC
Former 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 Officer
Capital project specialist with over 15 years experience in the Southern African mining and energy sectors
Former 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 & Development
Seasoned exploration geologist with over 15 years experience in the generation of exploration targets and
management of exploration and evaluation programmes
Operating experience in South Africa, Mozambique and Zimbabwe
Deb Battiston, CGA. │Chief Financial Officer
Financial specialist with over 20 years experience in the mining sector
Jennifer Wagner LLB. │Corporate Secretary
Corporate securities lawyer who has worked as a legal consultant to various TSX and TSX Venture listed
companies in the mining industry.
Bob Bentley, │Mining Manager
Former Mine Inspector in KwaZuluNatal
Over 30 year of Mining management experience
7
Directors
Stan Bharti, P.Eng. │Executive Chairman
Business 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 │Director
Over nine years of asset evaluation, research and corporate finance experience
President and Director of Aberdeen International (seed investor in Forbes Coal)
Grant Davey, P. Eng. │Director
Mining Engineer with close to 20 years experience in coal, platinum and gold mining industry
Previously held senior operational management roles for Anglo American in South Africa & Australia
David Gower, P. Geo. │Director
Professional Geologist and the former Global Head of Nickel Exploration for Falconbridge
Ryan Bennett, M.Mining Eng│Director
Masters degree in Mining Engineering from the Colorado School of Mines
Extensive technical mining project analyses experience
Senior Partner of Resource Capital Fund
8
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
$300
(US$ /tonne)
$250
$200
$150
$100
$50
Richards Bay Thermal Coal Spot Price
Jan-11
Nov-10
Sep-10
Jul-10
May-10
Mar-10
Jan-10
Nov-09
Sep-09
Jul-09
May-09
Mar-09
Jan-09
Nov-08
Sep-08
Jul-08
May-08
Mar-08
Jan-08
Nov-07
Sep-07
Jul-07
May-07
Mar-07
Jan-07
$0
McCloskey/Xinhua Infolink's Coking Coal Price
Source: Bloomberg
9
Established Mining Region
Source: Company reports
10
Mining Resource
• Recently completed NI 43 – 101 technical report calls for +18.0 year weighed life of mine
(“LOM”)
NI 43 – 101 Global Resource1
P&P
M&I
Magdalena - Bituminous
24.6
54.2
Aviemore - Anthracite
8.0
35.9
16.9
52.8
Total
32.6
90.1
16.9
107.0
1.
2.
As set out in the Technical Report of the Company available on the SEDAR profile of the Company at
www.sedar.com.
Exclusive of reserves
Inferred
MI&I
54.2
11
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
Richard’s Bay Port
World’s Largest Coal Terminal
– 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
12
Magdalena Bituminous Coal Operations
13
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
• 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
Magdalena Sales Mix (2010E)
Export
34%
Domestic
66%
14
Growing Bituminous Coal Demand from China and India
• 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
200
2008
2009
(M tonnes)
(M tonnes)
Asia
11.1
25.1
China
presumed low presumed low
India
6.8
17.7
Europe
38.9
28.1
Thermal coal exports
61.7
61.1
180
160
140
120
100
2010
(M tonnes)
37.4
7.0
20.3
15.9
63.4
80
60
40
20
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
0
India
1.
2.
3.
Richard’s Bay Terminal Bituminous Coal Exports 3
10x increase
1996
Bituminous Coal Imports (M tonnes)
China and India Bituminous Coal Imports2
China
Chinese trade data, Canaccord Genuity Research
Source: December 2010 Xstrata presentation
Richard’s Bay Terminal, Canaccord Genuity Research
15
Magdalena Bituminous Coal Operations
Asset Summary1
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
1.
2.
Magdalena Operations and Site Layout
Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
Fiscal year-end February 28
16
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
(000 t)/February 28 year-end
1,003
900
857
856
2014E
2015E
601
299
2006
347
326
2007
2008
449
485
2009
2010
Magdalena - open pit
1.
2011E
2012E
2013E
Magdalena - underground
Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
17
Selected Magdalena Photographs
Source: Company reports
18
Aviemore Anthracite Coal Operations
19
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%
Anthracite Coal Exports/Imports (2009)1
Exports
Imports
Other
Other
Japan
11%
2%
8%
Europe
Ukraine
8%
8%
China
South Korea
8%
10%
Vietnam
Russia
60%
13%
China
72%
Anthracite Coal Users by Industry
Domestic
• Iron & Steel (ArcelorMittal - large
producer)
• Ferrochrome
• FerroAlloys (Titanium)
• Chemical
• Heating
Export
• Brazilian, Indian and European Steel
manufacturers
1. Source: Resource-net
20
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
South African Anthracite Coal Producer Locations
(M t)
Domestic Demand CAGR = 11.6%
Export Demand CAGR = 4.5%
1.6
1.5
1.2
2000
2001
2002
1.4
1.0
2003
2004
Domestic Sales
2.6
Forbes Coal
1.4
1.2
2005
2.8
2006
2007
2008
Export Sales
1. Source: Resource-net
21
Aviemore Anthracite Coal Operations
Asset Summary1
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
1.
2.
Aviemore Operations
Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
Fiscal year-end February 28
22
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
504
504
2014E
2015E
420
161
1.
59
62
61
2006
2007
2008
102
20
2009
2010
52
2011E
2012E
2013E
Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
23
Selected Aviemore Photographs
Source: Company reports
24
Company Outlook
25
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$5.0M
Source: Company reports
26
External Growth Opportunities
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
Source: Company reports
27
2010 – 2015 Mine Plan
• 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
Saleable Production1
(000 t)
1,423
1,361
Cost per ROM tonne YTD2
1,360
COST ZAR/ ROM t
Aviemore U/G
Magdalena
U/G
Magdalena O/C
Total
1,061
Run of Mine tonnes
117,179
411,352
215,184
743,715
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
217
262
227
245
Mining Cost
653
505
Total ZAR/t
2010FY
2011FY
2012FY
2013FY
2014FY
2015FY
Bituminous Anthracite
1.
2.
Source: National Instrument 43 – 101 Report (Minxcon April 30, 2010) available under the profile of the Company on SEDAR at www.sedar.com.
Company estimates year to date March 2010 to December 2010
28
Capitalization and Share Performance
Share Performance
Comparable Trading Analysis
Trading Range Since September
27, 2010
Basic Shares Outstanding
FD Shares Outstanding*
1.4
$5.00
C$4.45
C$2.65 – C$4.60
34.8 million
40.8 million
Market Capitalization (Basic)
C$155 million
Market Capitalization (FD)
C$181 million
Estimated Enterprise Value(Basic)
C$135 million
$4.50
1.2
$4.00
1.0
$3.50
$3.00
0.8
$2.50
0.6
$2.00
$1.50
0.4
$1.00
0.2
$0.50
Volume
Dec-10
Oct-10
Nov-10
$-
Sep-10
0.0
* 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$2.80 per share and expiring on January 23,
2012
* Includes 2,700,00 performance warrants that convert into common
shares upon the company reaching certain operating targets
Price (C$)
Closing Price (February 28, 2011)
TSX: FMC
Volume (millions)
Company Ticker
Price
29
Comparable Trading Analysis
• Forbes Coal trades at a significant discount to comparable coal producers on an EV/EBITDA
and P/CF basis
Comparable Trading Analysis
Market Cap
(US$M)
EV
(US$M)
$7,876
$5,802
$740
$11,586
$1,730
$706
$5,759
$2,001
$16,931
$7,970
$7,278
$1,428
$14,906
$1,926
$826
$6,654
$2,262
$18,585
7.0x
6.7x
4.0x
8.2x
6.2x
4.9x
7.0x
7.6x
7.4x
6.6x
5.7x
5.6x
3.6x
6.2x
4.3x
5.1x
5.9x
4.5x
6.4x
5.3x
9.4x
8.5x
3.6x
9.7x
7.4x
5.7x
7.9x
6.5x
9.8x
7.6x
7.2x
6.6x
2.3x
7.6x
6.6x
10.9x
7.3x
3.9x
8.2x
6.7x
African Coal Producers
Coal of Africa Limited
Exxaro Resources
Keaton Energy
Optimum Coal
Petmin Limited
Riversdale Mining1
African Coal Producers Average
$926
$7,927
$90
$1,087
$253
$3,290
$910
$8,341
$90
$1,138
$222
$2,765
6.0x
8.8x
4.3x
4.8x
4.7x
44.6x
12.2x
3.3x
6.3x
2.1x
3.9x
3.7x
18.0x
6.3x
NA
7.2x
NA
3.8x
NA
48.8x
20.0x
NA
5.4x
NA
3.2x
NA
25.1x
11.2x
Other Coal Producers
Cline Mining
Gloucester Coal
Grande Cache Coal
MacArthur Coal
Western Coal 2
Other Coal Producers Average
$720
$1,675
$1,093
$3,965
$2,517
$718
$1,655
$1,098
$3,719
$2,447
15.8x
12.2x
6.8x
9.1x
4.4x
8.1x
4.6x
8.0x
4.6x
7.3x
3.9x
6.0x
18.5x
17.3x
7.1x
13.3x
4.4x
10.5x
6.6x
12.4x
4.8x
10.6x
4.0x
7.9x
6.8x
5.2x
8.4x
7.1x
2.8x
(58%)
2.1x
(59%)
2.8x
(67%)
2.5x
(65%)
Company
U.S. Coal Producers
Alpha Natural Resources
Arch Coal
Cloud Peak Energy
Consol Energy
International Coal Group
James River Coal
Massey Energy
Patriot Coal
Peabody Energy
U.S. Coal Producers Average
Overall Average (excluding high and low)
Forbes Coal
Forbes Coal - Discount to Comparables
$
119
$
160
EV / EBITDA
2011E
2012E
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, 2010
Source: Consensus estimates and company reports
P/CFPS
2011E
2012E
30