PERIOD ENDED DECEMBER 31, 2003 Annual ... - Peabody Energy

Peabody Energy Corporation (NYSE: BTU) is the world’sOur MissionOur StrategiesOur Accomplishmentslargest coal company. Our products fuel approximately9.8 percent of America’s electricity and nearly2.5 percent of the world’s electricity. BTU’s share pricerose 49 percent from our May 2001 initial public offeringthrough December 2003, far outpacing the S&P 500 ®and other major public coal companies.Peabody’s mission is to be aworldwide supplier of low-costenergy, which contributes toeconomic prosperity and a betterquality of life.We are committed to rewardingshareholders with superior earningsperformance and sustainedearnings growth.We operate under three strategiesto create value:Strategy 1Managing safe, low-cost operationsStrategy 2Applying world-class salesand trading techniquesStrategy 3Aggressively managing our vastnatural resource positionIn 2003, Peabody:■ Achieved a total shareholderreturn of 45 percent■ Met management’s Adjusted EBITDAand earnings targets every quarter■ Set an industry record withcoal sales of 203.2 million tons■ Improved our safety accidentrate another 18 percent■ Operated the most productivemine in America and three ofthe six most productive mines■ Purchased the remaining18 percent of Black BeautyCoal CompanyBTU Share Price Performance■ Announced preliminaryagreements to acquire mines inAustralia, Colorado and Venezuela50403020BTU+49.0%■ Lowered interest expensethrough a $1.7 billion refinancing■ Received four outstandingreclamation and community10awards from the U.S. DepartmentPercent Change0-10-20-30-40-50S&P 500 ®-15.3%of the InteriorMay 21,2001, IPODec. 31,2001Dec. 31,2002Dec. 31,2003(FOLDOUT)