Warrior Met Coal, Inc. recently announced its first quarter 21 results. Warrior is a leading US producer and exporter of high quality metallurgical coal for the global steel industry.
Warrior reported a net loss of $ 21.4 million, or $ 0.42 per diluted share, for the first quarter of 21, compared to net income of $ 21.5 million, or $ 0.42 per diluted share, for the first quarter of 20 Adjusted net earnings per share for the first quarter of 21 was $ 0.08 per diluted share, compared to adjusted net earnings per share of $ 0.39 per diluted share for the first quarter of 20. The company reported adjusted EBITDA of 47 for the first quarter of 21 .1 million, compared to adjusted EBITDA of $ 62 million in the first quarter of 20.
“In the first quarter, COVID-19 and the Chinese ban on Australian coal have had an ongoing impact on pricing and demand across the coal industry,” commented Walt Scheller, CEO of Warrior. “However, we have continued to focus on successfully managing our costs, working capital and capital expenditures, which has enabled us to generate positive free cash flow despite these headwinds.”
Scheller continued: “The end of the first quarter also coincided with the expiration of our collective agreement with the United Mine Workers of America (UMWA) on April 1, 2021. While we continue to negotiate in good faith with the UMWA to reach a new one The UMWA decided to go on strike. “
“What is important is that we have business continuity plans to continue serving the needs of our valued customers during this time.”
Operating results
The company produced 2.2 million tons of metallurgical coal in the first quarter of 21 compared to 2.1 million tons of tons in the first quarter of 20. The sales volume in the first quarter of 21 was 2 million Short T compared to 1.8 million Short T in the first quarter of 20 As of March 31, 2021, stocks increased from 998,000 at the end of 2020 to 1.2 million short t.
Additional financial results
Total sales in the first quarter of 21 were € 213.8 million. Including $ 207 million in mining revenues from revenues of 2 million tonnes of metallurgical coal at an average net selling price of $ 106.04 per short tonnes, less mooring and other charges. This translates into total revenue of $ 226.7 million for Q1 20. The Company’s average net sell price of hit coal decreased 13% from $ 122.02 per short-T in Q1 20 to $ 106.04 per short-T back in the first quarter of 21. During the first quarter of 21, the company achieved an average metallurgical coal selling price of $ 106.04 per short-t, which is 95% of the premium Australian premium low-volatile coke (HCC) price over the same period. The year-over-year decline in sales and profits is mainly due to weaker metallurgical coal prices in difficult market conditions linked to the impact of COVID-19 and the Chinese ban on Australian coal.
Cost of sales for the first quarter of 21 was $ 154.4 million compared to $ 151.5 million for the first quarter of 20. Cash cost of sales (including mining, transportation, and licensing costs) was 153 for the first quarter of 21, $ 5 million, or 74.2% of mining revenue, compared to $ 150.7 million, or 68.1% of mining revenue, for the same period in 2020. Cost of cash (free-on-board port) per short t decreased in the first quarter of 21 from $ 83.07 in the first quarter of 20 to $ 78.64. This reflects Warrior’s low and variable cost structure and focuses on cost control in times of low metallurgical coal prices.
Selling, general, and administrative expenses for the first quarter of 21 were $ 7.6 million, or 3.6% of total revenue, 9.7% lower than for the same period last year. Depreciation and amortization charges for the first quarter of 21 were $ 32.9 million, or 15.4% of total sales, and were 14.7% higher than the same period last year. Warrior incurred net interest expense of $ 8.7 million in the first quarter of 21, up from the year-ago quarter as interest was paid on the ABL draw and lower returns on the cash balance. Income tax expense for the first quarter of 21 was $ 23.6 million due to a non-cash charge that was recognized in the creation of an allowance for the company’s government deferred income tax asset. This finding was due to a change in Alabama tax law on February 12, 2021 that went into effect on January 1, 2021. All sales originating in Alabama that were made to a jurisdiction in which the seller is not taxable must be excluded from Alabama taxable income without taking advantage of Alabama net operating losses. This corresponds to an income tax expense of $ 3.2 million in the first quarter of 20.
Read the article online at: https://www.worldcoal.com/coal/06052021/warrior-met-coal-reports-1q21-results/