Dear Capital Market Participants,
Adaro Energy has today lodged to the Indonesia Stock Exchange and the OJK our Consolidated Interim Financial Statements and Notes for the first quarter of 2014, together with an accompanying 1Q14 Financial Press Release.
Adaro Energy Delivers Solid EBITDA of US$306 million on Track to Achieve Annual Guidance
Solid Performance Despite Market Challenges, EBITDA of US$306 million and Net Income of US$131 million.
• Our revenue increased 14% to US$845 million due to higher sales volume as our average selling price (ASP) declined 7%. Cost of revenue declined 1% to US$599 million while EBITDA increased 81% to US$306 million resulting in an EBITDA margin of 36%. Our net income for 1Q14 increased 344% to US$131 million mainly due to higher sales volume and lower costs.
• Our 1Q14 Operational EBITDA and Core Earnings, which excluded non-operational accounting items, increased 74% to US$294 million and 221% to US$137 million, respectively. Operational EBITDA was lower than the reported EBITDA due to a one-time gain.
• We lowered our coal cash cost (excluding royalty) 24% to US$29.82 per tonne in 1Q14, mostly due to the seasonally lower strip ratio, although overburden volumes increased 10%, as well as lower freight and handling, lower fuel cost, and other cost reduction initiatives. We started reporting stripping costs in 2014 on an actual cost basis.
Strong Production Growth and Prudent Capital Spending
• We increased production volume 22% in 1Q14 to 14.0 Mt and sales volume by 23% to 13.9 Mt due to strong demand for our coal.
• Our coal volumes slightly exceeded the plan for 1Q14, while overburden volumes were 95% of the plan.
• Our net capital expenditure during 1Q14 decreased by 62% to US$18 million due to delays. We are on track to achieve our capital expenditure guidance of US$200 million to US$250 million.
• We generated strong positive free cash flow of US$84 million.
Maintained Strong Balance Sheet and Liquidity
• Our capital structure improved as we reduced debt by 6% and increased our cash position 48% to $828 million, resulting in net debt to last 12 months EBITDA of 1.48x and net debt to equity of 0.43x as of the end of 1Q14.
• Our liquidity was strong with access to cash of approximately US$1.2 billion, allowing us to weather the current cyclical downturn and continue to execute on our business model.
• We will continue to preserve cash, strengthen our capital structure and extend the maturity profiles of our borrowings.
Financial Media Contact:
Cameron Tough, Head of Investor Relations & Corporate Secretary
Public & General Media Contact:
Devindra Ratzarwin, Corporate Secretary