RESULTS FOR SIX MONTHS ENDED 30 SEPTEMBER 2013

WWW.KEATONENERGY.CO.ZA

RESULTS FOR SIX MONTHS ENDED 30 SEPTEMBER 2013

Monday, 18 November 201310h00

1

2

MANDI GLADCHIEF EXECUTIVE OFFICER


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


SAFETY

VANGGATFONTEIN LTIFR VAALKRANTZ LTIFR

5

1HFY13 2HFY13 1HFY14

0.20

0.00

0.10


0.45

0.36

0.17

FATALITY FREE SINCE INCEPTION

* LTIFR per 200 000 man hours


VANGGATFONTEIN VAALKRANTZ

6

OPERATIONS


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


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

7

GROWTH


SUSTAINABLE

8

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


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


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


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


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


FINANCIAL

14

PERFORMANCE

GROSS PROFIT


-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%



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


1HFY11 1HFY12 1HFY13 1HFY14-25

-20

-15

-10

-5

0

5

10

15

20

25

1.7

8.4


HEADLINE EARNINGS PER SHARE (CPS)

(21.1)

19.4


-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



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


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


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.

RESULTS FOR SIX MONTHS ENDED 30 SEPTEMBER 2013

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