8-K
Alpha Metallurgical Resources, Inc. (AMR)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_______________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): May 3, 2023
ALPHA METALLURGICAL RESOURCES, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
| 001-38735 | 81-3015061 |
|---|---|
| (Commission File Number) | (IRS Employer Identification No.) |
| 340 Martin Luther King Jr. Blvd.<br><br>Bristol, Tennessee 37620 | |
| --- | |
| (Address of Principal Executive Offices, zip code) |
(423) 573-0300
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock | AMR | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging Growth Company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
| TABLE OF CONTENTS |
|---|
| Item 2.02 Results of Operations and Financial Condition |
| Item 5.07 Submission of Matters to a Vote of Security Holders |
| Item 9.01 Financial Statements and Exhibits |
| Signatures |
| Exhibit Index |
Item 2.02 Results of Operations and Financial Condition.
On May 8, 2023, Alpha Metallurgical Resources, Inc. (the “Company”) issued a press release announcing earnings and other financial results for its fiscal quarter ended March 31, 2023. The press release is attached hereto as Exhibit 99.1.
Item 5.07 Submission of Matters to a Vote of Security Holders.
On May 3, 2023, the Company held its Annual Meeting of Stockholders (the “Annual Meeting”) via internet webcast. As of the record date for the Annual Meeting, March 10, 2023, there were 15,012,143 shares of common stock outstanding and eligible to vote. 11,842,826 of these shares, or 78.88%, were represented in person or by proxy at the Annual Meeting. The final results of the matters voted on at the Annual Meeting are provided below.
Proposal 1: The election of nine (9) directors nominated by our board of directors for a term of one year. Each of the nominees was elected.
| Nominee | For | Withheld | Broker Non-Votes |
|---|---|---|---|
| Joanna Baker de Neufville | 9,319,907 | 25,440 | 2,497,479 |
| Kenneth S. Courtis | 7,067,913 | 2,277,434 | 2,497,479 |
| C. Andrew Eidson | 9,325,240 | 20,107 | 2,497,479 |
| Albert E. Ferrara, Jr. | 9,204,657 | 140,690 | 2,497,479 |
| Elizabeth A. Fessenden | 9,234,102 | 111,245 | 2,497,479 |
| Michael Gorzynski | 9,297,815 | 47,532 | 2,497,479 |
| Michael J. Quillen | 6,985,463 | 2,359,884 | 2,497,479 |
| Daniel D. Smith | 9,246,232 | 99,115 | 2,497,479 |
| David J. Stetson | 9,241,304 | 104,043 | 2,497,479 |
Proposal 2: Approval of an amendment and restatement of our second amended and restated certificate of incorporation to replace stockholder supermajority approval requirements with majority approval requirements. The proposal, approval of which required the affirmative vote of two-thirds of outstanding shares, was not approved.
| For: | 9,109,470 |
|---|---|
| Against: | 233,898 |
| Abstain: | 1,979 |
| Broker Non-Votes: | 2,497,479 |
Proposal 3: The ratification of RSM US LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2023. The proposal, approval of which required the affirmative vote of a majority of votes cast, was approved.
| For: | 11,839,701 |
|---|---|
| Against: | 1,576 |
| Abstain: | 1,549 |
| Broker Non-Votes: | — |
Proposal 4: Advisory approval of the Company’s executive compensation. The proposal, approval of which required the affirmative vote of a majority of votes cast, was approved.
| For: | 8,945,852 |
|---|---|
| Against: | 394,328 |
| Abstain: | 5,167 |
| Broker Non-Votes: | 2,497,479 |
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit 99.1 | Press Release dated May 8, 2023 |
|---|---|
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Alpha Metallurgical Resources, Inc. | ||
|---|---|---|
| Date: May 8, 2023 | By: | /s/ J. Todd Munsey |
| Name: J. Todd Munsey | ||
| Title: Chief Financial Officer |
EXHIBIT INDEX
| Exhibit No. | Description |
|---|---|
| Exhibit 99.1 | Press Release datedMay 8, 2023 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Document
| FOR IMMEDIATE RELEASE |
|---|
Alpha Announces First Quarter 2023 Financial Results
•Reports first quarter net income of $270.8 million, or $17.01 per diluted share
•Posts Adjusted EBITDA of $354.4 million for the quarter
•Continues executing on robust buyback program by returning approximately $200 million to shareholders year-to-date as of May 4, 2023, with roughly $485 million in board authorization remaining
•Increases quarterly dividend to $0.50 from $0.44 per share
BRISTOL, Tenn., May 8, 2023 - Alpha Metallurgical Resources, Inc. (NYSE: AMR), a leading U.S. supplier of metallurgical products for the steel industry, today reported financial results for the first quarter ending March 31, 2023.
| (millions, except per share) | |||
|---|---|---|---|
| Three months ended | |||
| Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | |
| Net income | $270.8 | $220.7 | $400.9 |
| Net income per diluted share | $17.01 | $13.37 | $20.52 |
| Adjusted EBITDA(1) | $354.4 | $247.9 | $503.7 |
| Operating cash flow | $177.4 | $185.0 | $336.1 |
| Capital expenditures | ($74.2) | ($61.0) | ($28.1) |
| Tons of coal sold | 3.9 | 3.9 | 4.0 |
__________________________________
- These are non-GAAP financial measures. A reconciliation of Net Income to Adjusted EBITDA is included in tables accompanying the financial schedules.
"Coming off an exceptional and record-setting year in 2022, we set high expectations for Alpha in 2023, and our first quarter performance is a solid foundation on which we can continue building throughout the rest of the year," said Andy Eidson, Alpha's chief executive officer. "In addition to strong operational performance across the portfolio, we are progressing well on our
capital investment projects. We also continue to execute on our share repurchase program, working through the current authorization in place; with approximately $200 million spent on buybacks year to date, we have now cumulatively spent approximately $715 million on repurchases, with another roughly $485 million in remaining authorization available to spend."
The company's annual meeting of stockholders was held on May 3, 2023. Shareholders re-elected all members of Alpha's board of directors who stood for re-election. The complete voting results from our annual meeting will be filed on Form 8-K with the Securities and Exchange Commission.
Financial Performance
Alpha reported net income of $270.8 million, or $17.01 per diluted share, for the first quarter 2023. In the fourth quarter of 2022, the company had net income of $220.7 million, or $13.37 per diluted share.
For the first quarter, total Adjusted EBITDA was $354.4 million, compared to $247.9 million in the fourth quarter 2022.
Coal Revenues
| (millions) | ||||||
|---|---|---|---|---|---|---|
| Three months ended | ||||||
| Mar. 31, 2023 | Dec. 31, 2022 | |||||
| Met Segment | $887.0 | $804.9 | ||||
| All Other | $19.7 | $16.3 | Met Segment (excl. freight & handling)(1) | $780.8 | $699.0 | |
| --- | --- | --- | ||||
| All Other (excl. freight & handling)(1) | $19.5 | $16.3 | ||||
| Tons Sold | (millions) | |||||
| --- | --- | --- | ||||
| Three months ended | ||||||
| Mar. 31, 2023 | Dec. 31, 2022 | |||||
| Met Segment | 3.7 | 3.8 | ||||
| All Other | 0.2 | 0.1 |
__________________________________
- Represents Non-GAAP coal revenues which is defined and reconciled under "Non-GAAP Financial Measures" and "Results of Operations."
Coal Sales Realization(1)
| (per ton) | ||
|---|---|---|
| Three months ended | ||
| Mar. 31, 2023 | Dec. 31, 2022 | |
| Met Segment | $208.93 | $186.29 |
| All Other | $109.36 | $126.10 |
__________________________________
- Represents Non-GAAP coal sales realization which is defined and reconciled under "Non-GAAP Financial Measures" and "Results of Operations."
First quarter net realized pricing for the Met segment was $208.93 per ton and net realization in the All Other category was $109.36.
The table below provides a breakdown of our Met segment coal sold in the first quarter by pricing mechanism.
| (in millions, except per ton data) | |||
|---|---|---|---|
| Met Segment Sales | Three months ended Mar. 31, 2023 | ||
| Tons Sold | Coal Revenues | Realization/ton(1) | |
| Export - Other Pricing Mechanisms | 1.6 | $329.2 | 211.31 |
| Domestic | 1.1 | $206.4 | 192.88 |
| Export - Australian Indexed | 0.9 | $216.0 | 240.76 |
| Total Met Coal Revenues | 3.5 | $751.6 | 213.21 |
| Thermal Coal Revenues | 0.2 | $29.2 | 137.65 |
| Total Met Segment Coal Revenues (excl. freight & handling)(1) | 3.7 | $780.8 | 208.93 |
All values are in US Dollars.
__________________________________
- Represents Non-GAAP coal sales realization which is defined and reconciled under "Non-GAAP Financial Measures" and "Results of Operations."
Cost of Coal Sales
| (in millions, except per ton data) | ||
|---|---|---|
| Three months ended | ||
| Mar. 31, 2023 | Dec. 31, 2022 | |
| Cost of Coal Sales | $539.1 | $549.1 |
| Cost of Coal Sales (excl. freight & handling/idle)(1) | $426.5 | $434.3 |
| (per ton) | ||
| --- | --- | --- |
| Met Segment(1) | $110.56 | $112.97 |
| All Other(1) | $74.69 | $80.76 |
__________________________________
- Represents Non-GAAP cost of coal sales and Non-GAAP cost of coal sales per ton which is defined and reconciled under "Non-GAAP Financial Measures" and "Results of Operations."
Alpha's Met segment cost of coal sales improved to an average of $110.56 per ton in the first quarter, compared to $112.97 per ton in the fourth quarter of 2022. Cost of coal sales for the All Other category decreased to $74.69 per ton in the first quarter, down from a cost of $80.76 per ton in the fourth quarter 2022.
Liquidity and Capital Resources
Cash provided by operating activities in the first quarter decreased to $177.4 million as compared to $185.0 million in the fourth quarter 2022. The first quarter operating cash flows were negatively impacted by an increase of $133.8 million of working capital. The primary drivers were higher accounts receivable and inventory balances with a partially offsetting reduction in short-term deposits. Capital expenditures for the first quarter 2023 were $74.2 million compared to $61.0 million for the fourth quarter of 2022.
As of March 31, 2023, the company had total liquidity of $315.6 million, including cash and cash equivalents of $222.5 million and $93.1 million of unused availability under the ABL. The future available capacity under the ABL is subject to inventory and accounts receivable collateral requirements and the maintenance of certain financial ratios. As of March 31, 2023, the company had no borrowings and $61.9 million in letters of credit outstanding under the ABL. Total long-term debt, including the current portion of long-term debt as of March 31, 2023, was $11.9 million and consists primarily of equipment financing obligations.
Dividend Program
On May 3, 2023, Alpha's board of directors declared a quarterly cash dividend payment of $0.50 per share, increased from the prior quarter's dividend of $0.44 per share, which will become payable on July 5, 2023 for holders of record as of June 15, 2023.
Any decision to pay future cash dividends will be made by the board and depend on Alpha's future earnings and financial condition and other relevant factors.
Share Repurchase Program
As previously announced, Alpha's board of directors authorized a share repurchase program allowing for the expenditure of up to $1.2 billion for the repurchase of the company's common stock. As of May 4, 2023, the company has acquired approximately 4.8 million shares of common stock at a cost of approximately $715 million. The number of common stock shares outstanding as of May 4, 2023 was 14,452,474, not including the potentially dilutive effect of unexercised warrant shares or unvested equity awards.
The timing and amount of share repurchases will continue to be determined by the company's management based on its evaluation of market conditions, the trading price of the stock, applicable legal requirements, compliance with the provisions of the company's debt agreements, and other factors.
2023 Guidance Adjustment and Performance Update
Alpha is reducing tax rate guidance for the full year 2023. The new tax rate guidance range for the year is 12% to 17%, down from the prior range of 15% to 20%.
As of April 27, 2023, Alpha has committed and priced approximately 51% of its metallurgical coal within the Met segment at an average price of $203.86 per ton and 75% of thermal coal in the Met segment at an average expected price of $108.77 per ton. In the All Other category the company is 100% committed and priced at an average price of $88.74 per ton.
| 2023 Guidance | ||
|---|---|---|
| in millions of tons | Low | High |
| Metallurgical | 15.0 | 16.0 |
| Thermal | 1.4 | 1.8 |
| Met Segment | 16.4 | 17.8 |
| All Other | 0.3 | 0.6 |
| Total Shipments | 16.7 | 18.4 |
| Committed/Priced1,2,3 | Committed | Average Price |
| Metallurgical - Domestic | 193.26 | |
| Metallurgical - Export | 220.89 | |
| Metallurgical Total | 51 | 203.86 |
| Thermal | 75 | 108.77 |
| Met Segment | 53 | 191.28 |
| All Other | 100 | 88.74 |
| Committed/Unpriced1,3 | Committed | |
| Metallurgical Total | 43 | |
| Thermal | — | |
| Met Segment | 39 | |
| All Other | — | |
| Costs per ton4 | Low | High |
| Met Segment | 106.00 | 112.00 |
| All Other | 87.00 | 93.00 |
| In millions (except taxes) | Low | High |
| SG&A5 | 59 | 65 |
| Idle Operations Expense | 21 | 31 |
| Cash Interest Expense | 2 | 10 |
| DD&A | 115 | 135 |
| Capital Expenditures | 250 | 280 |
| Tax Rate | 12 | 17 |
All values are in US Dollars.
Notes:
1.Based on committed and priced coal shipments as of April 27, 2023. Committed percentage based on the midpoint of shipment guidance range.
2.Actual average per-ton realizations on committed and priced tons recognized in future periods may vary based on actual freight expense in future periods relative to assumed freight expense embedded in projected average per-ton realizations.
3.Includes estimates of future coal shipments based upon contract terms and anticipated delivery schedules. Actual coal shipments may vary from these estimates.
4.Note: The Company is unable to present a quantitative reconciliation of its forward-looking non-GAAP cost of coal sales per ton sold financial measures to the most directly comparable GAAP measures without unreasonable efforts due to the inherent difficulty in forecasting and quantifying with reasonable accuracy significant items required for the reconciliation. The most directly comparable GAAP measure, GAAP cost of sales, is not accessible without unreasonable efforts on a forward-looking basis. The reconciling items include freight and handling costs, which are a component of GAAP cost of sales. Management is unable to predict without unreasonable efforts freight and handling costs due to uncertainty as to the end market and FOB point for uncommitted sales volumes and the final shipping
point for export shipments. These amounts have historically varied and may continue to vary significantly from quarter to quarter and material changes to these items could have a significant effect on our future GAAP results.
5.Excludes expenses related to non-cash stock compensation and non-recurring expenses.
Conference Call
The company plans to hold a conference call regarding its first quarter 2023 results on May 8, 2023, at 10:00 a.m. Eastern time. The conference call will be available live on the investor section of the company’s website at https://alphametresources.com/investors. Analysts who would like to participate in the conference call should dial 877-407-0832 (domestic toll-free) or 201-689-8433 (international) approximately 15 minutes prior to start time.
About Alpha Metallurgical Resources
Alpha Metallurgical Resources (NYSE: AMR) is a Tennessee-based mining company with operations across Virginia and West Virginia. With customers across the globe, high-quality reserves and significant port capacity, Alpha reliably supplies metallurgical products to the steel industry. For more information, visit www.AlphaMetResources.com.
Forward-Looking Statements
This news release includes forward-looking statements. These forward-looking statements are based on Alpha's expectations and beliefs concerning future events and involve risks and uncertainties that may cause actual results to differ materially from current expectations. These factors are difficult to predict accurately and may be beyond Alpha’s control. Forward-looking statements in this news release or elsewhere speak only as of the date made. New uncertainties and risks arise from time to time, and it is impossible for Alpha to predict these events or how they may affect Alpha. Except as required by law, Alpha has no duty to, and does not intend to, update or revise the forward-looking statements in this news release or elsewhere after the date this release is issued. In light of these risks and uncertainties, investors should keep in mind that results, events or developments discussed in any forward-looking statement made in this news release may not occur.
FINANCIAL TABLES FOLLOW
Non-GAAP Financial Measures
The discussion below contains “non-GAAP financial measures.” These are financial measures that either exclude or include amounts that are not excluded or included in the most directly comparable measures calculated and presented in accordance with generally accepted accounting principles in the United States (“U.S. GAAP” or “GAAP”). Specifically, we make use of the non-GAAP financial measures “Adjusted EBITDA,” “non-GAAP coal revenues,” “non-GAAP cost of coal sales,” “non-GAAP coal margin,” and “Adjusted cost of produced coal sold.” We use Adjusted EBITDA to measure the operating performance of our segments and allocate resources to the segments. Adjusted EBITDA does not purport to be an alternative to net income (loss) as a measure of operating performance or any other measure of operating results or liquidity presented in accordance with GAAP. We use non-GAAP coal revenues to present coal revenues generated, excluding freight and handling fulfillment revenues. Non-GAAP coal sales realization per ton for our operations is calculated as non-GAAP coal revenues divided by tons sold. We use non-GAAP cost of coal sales to adjust cost of coal sales to remove freight and handling costs, depreciation, depletion and amortization - production (excluding the depreciation, depletion and amortization related to selling, general and administrative functions), accretion on asset retirement obligations, amortization of acquired intangibles, net, and idled and closed mine costs. Non-GAAP cost of coal sales per ton for our operations is calculated as non-GAAP cost of coal sales divided by tons sold. Non-GAAP coal margin per ton for our coal operations is calculated as non-GAAP coal sales realization per ton for our coal operations less non-GAAP cost of coal sales per ton for our coal operations. We also use Adjusted cost of produced coal sold to distinguish the cost of captive produced coal from the effects of purchased coal. The presentation of these measures should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP.
Management uses non-GAAP financial measures to supplement GAAP results to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone. The definition of these non-GAAP measures may be changed periodically by management to adjust for significant items important to an understanding of operating trends and to adjust for items that may not reflect the trend of future results by excluding transactions that are not indicative of our core operating performance. Furthermore, analogous measures are used by industry analysts to evaluate the Company’s operating performance. Because not all companies use identical calculations, the presentations of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate, and capital investments.
Included below are reconciliations of non-GAAP financial measures to GAAP financial measures.
ALPHA METALLURGICAL RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Amounts in thousands, except share and per share data)
| Three Months Ended March 31, | ||||
|---|---|---|---|---|
| 2023 | 2022 | |||
| Revenues: | ||||
| Coal revenues | $ | 906,698 | $ | 1,069,738 |
| Other revenues | 4,537 | 2,226 | ||
| Total revenues | 911,235 | 1,071,964 | ||
| Costs and expenses: | ||||
| Cost of coal sales (exclusive of items shown separately below) | 539,137 | 555,342 | ||
| Depreciation, depletion and amortization | 29,423 | 28,035 | ||
| Accretion on asset retirement obligations | 6,377 | 5,954 | ||
| Amortization of acquired intangibles, net | 2,197 | 5,748 | ||
| Selling, general and administrative expenses (exclusive of depreciation, depletion and amortization shown separately above) | 20,692 | 15,086 | ||
| Total other operating loss (income): | ||||
| Mark-to-market adjustment for acquisition-related obligations | — | 9,361 | ||
| Other income | (1,092) | (628) | ||
| Total costs and expenses | 596,734 | 618,898 | ||
| Income from operations | 314,501 | 453,066 | ||
| Other (expense) income: | ||||
| Interest expense | (1,720) | (13,083) | ||
| Interest income | 1,518 | 184 | ||
| Equity loss in affiliates | (1,748) | (1,361) | ||
| Miscellaneous income, net | 631 | 1,676 | ||
| Total other expense, net | (1,319) | (12,584) | ||
| Income before income taxes | 313,182 | 440,482 | ||
| Income tax expense | (42,411) | (39,591) | ||
| Net income | $ | 270,771 | $ | 400,891 |
| Basic income per common share | $ | 17.74 | $ | 21.58 |
| Diluted income per common share | $ | 17.01 | $ | 20.52 |
| Weighted average shares – basic | 15,266,895 | 18,574,026 | ||
| Weighted average shares – diluted | 15,916,378 | 19,540,642 |
ALPHA METALLURGICAL RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(Amounts in thousands, except share and per share data)
| March 31, 2023 | December 31, 2022 | |||
|---|---|---|---|---|
| Assets | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 222,507 | $ | 301,906 |
| Short-term investments | — | 46,052 | ||
| Trade accounts receivable, net of allowance for doubtful accounts of $369 and $239 as of March 31, 2023 and December 31, 2022, respectively | 546,252 | 407,210 | ||
| Inventories, net | 266,678 | 200,574 | ||
| Short-term deposits | 6,602 | 84,748 | ||
| Short-term restricted cash | — | 24,547 | ||
| Prepaid expenses and other current assets | 50,448 | 49,384 | ||
| Total current assets | 1,092,487 | 1,114,421 | ||
| Property, plant, and equipment, net of accumulated depreciation and amortization of $503,403 and $491,186 as of March 31, 2023 and December 31, 2022, respectively | 486,721 | 442,645 | ||
| Owned and leased mineral rights, net of accumulated depletion and amortization of $83,313 and $77,333 as of March 31, 2023 and December 31, 2022, respectively | 458,191 | 451,062 | ||
| Other acquired intangibles, net of accumulated amortization of $43,236 and $53,719 as of March 31, 2023 and December 31, 2022, respectively | 52,905 | 55,102 | ||
| Long-term restricted investments | 90,428 | 105,735 | ||
| Long-term restricted cash | 50,931 | 28,941 | ||
| Deferred income taxes | 10,497 | 11,378 | ||
| Other non-current assets | 106,957 | 103,195 | ||
| Total assets | $ | 2,349,117 | $ | 2,312,479 |
| Liabilities and Stockholders’ Equity | ||||
| Current liabilities: | ||||
| Current portion of long-term debt | $ | 3,562 | $ | 3,078 |
| Trade accounts payable | 122,738 | 106,037 | ||
| Acquisition-related obligations – current | 381 | 28,254 | ||
| Accrued expenses and other current liabilities | 189,927 | 265,256 | ||
| Total current liabilities | 316,608 | 402,625 | ||
| Long-term debt | 8,379 | 7,897 | ||
| Workers’ compensation and black lung obligations | 185,204 | 188,247 | ||
| Pension obligations | 102,700 | 110,836 | ||
| Asset retirement obligations | 144,851 | 142,048 | ||
| Deferred income taxes | 24,286 | 10,874 | ||
| Other non-current liabilities | 18,514 | 20,197 | ||
| Total liabilities | 800,542 | 882,724 | ||
| Commitments and Contingencies | ||||
| Stockholders’ Equity | ||||
| Preferred stock - par value $0.01, 5.0 million shares authorized, none issued | — | — | ||
| Common stock - par value $0.01, 50.0 million shares authorized, 21.8 million issued and 14.8 million outstanding at March 31, 2023 and 21.7 million issued and 15.5 million outstanding at December 31, 2022 | 218 | 217 | ||
| --- | --- | --- | --- | --- |
| Additional paid-in capital | 813,299 | 815,442 | ||
| Accumulated other comprehensive loss | (12,650) | (12,162) | ||
| Treasury stock, at cost: 7.0 million shares at March 31, 2023 and 6.2 million shares at December 31, 2022 | (791,557) | (649,061) | ||
| Retained earnings | 1,539,265 | 1,275,319 | ||
| Total stockholders’ equity | 1,548,575 | 1,429,755 | ||
| Total liabilities and stockholders’ equity | $ | 2,349,117 | $ | 2,312,479 |
ALPHA METALLURGICAL RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Amounts in thousands)
| Three Months Ended March 31, | ||||
|---|---|---|---|---|
| 2023 | 2022 | |||
| Operating activities: | ||||
| Net income | $ | 270,771 | $ | 400,891 |
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||
| Depreciation, depletion and amortization | 29,423 | 28,035 | ||
| Amortization of acquired intangibles, net | 2,197 | 5,748 | ||
| Amortization of debt issuance costs and accretion of debt discount | 534 | 3,679 | ||
| Mark-to-market adjustment for acquisition-related obligations | — | 9,361 | ||
| Gain on disposal of assets | (2,363) | (636) | ||
| Accretion on asset retirement obligations | 6,377 | 5,954 | ||
| Employee benefit plans, net | 3,261 | (174) | ||
| Deferred income taxes | 14,432 | 4,676 | ||
| Stock-based compensation | 3,034 | 1,182 | ||
| Equity loss in affiliates | 1,748 | 1,361 | ||
| Other, net | 126 | 135 | ||
| Changes in operating assets and liabilities | (152,153) | (124,087) | ||
| Net cash provided by operating activities | 177,387 | 336,125 | ||
| Investing activities: | ||||
| Capital expenditures | (74,248) | (28,146) | ||
| Proceeds on disposal of assets | 3,478 | 917 | ||
| Cash paid for business acquired | (11,919) | — | ||
| Purchases of investment securities | (141,750) | (50) | ||
| Sales and maturities of investment securities | 204,660 | 28,438 | ||
| Capital contributions to equity affiliates | (8,124) | (3,468) | ||
| Other, net | 12 | (1,243) | ||
| Net cash used in investing activities | (27,891) | (3,552) | ||
| Financing activities: | ||||
| Principal repayments of long-term debt | (438) | (200,461) | ||
| Dividend and dividend equivalents paid | (85,979) | — | ||
| Common stock repurchases and related expenses | (144,919) | (21,844) | ||
| Proceeds from exercise of warrants | 222 | 2,257 | ||
| Other, net | (338) | 348 | ||
| Net cash used in financing activities | (231,452) | (219,700) | ||
| Net (decrease) increase in cash and cash equivalents and restricted cash | (81,956) | 112,873 | ||
| Cash and cash equivalents and restricted cash at beginning of period | 355,394 | 182,614 | ||
| Cash and cash equivalents and restricted cash at end of period | $ | 273,438 | $ | 295,487 |
| Supplemental disclosure of noncash investing and financing activities: | ||||
| Financing leases and capital financing - equipment | $ | 1,753 | $ | 736 |
| Accrued capital expenditures | $ | 13,703 | $ | 9,529 |
| --- | --- | --- | --- | --- |
| Accrued common stock repurchases | $ | 5,995 | $ | 1,996 |
| Dividends declared | $ | 6,825 | $ | — |
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the Condensed Consolidated Balance Sheets that sum to the total of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows.
| As of March 31, | ||||
|---|---|---|---|---|
| 2023 | 2022 | |||
| Cash and cash equivalents | $ | 222,507 | $ | 159,455 |
| Short-term restricted cash | — | 17,556 | ||
| Long-term restricted cash | 50,931 | 118,476 | ||
| Total cash and cash equivalents and restricted cash shown in the Condensed Consolidated Statements of Cash Flows | $ | 273,438 | $ | 295,487 |
ALPHA METALLURGICAL RESOURCES, INC. AND SUBSIDIARIES
ADJUSTED EBITDA RECONCILIATION
(Amounts in thousands)
| Three Months Ended | ||||||
|---|---|---|---|---|---|---|
| March 31, 2023 | December 31, 2022 | March 31, 2022 | ||||
| Net income | $ | 270,771 | $ | 220,680 | $ | 400,891 |
| Interest expense | 1,720 | 1,747 | 13,083 | |||
| Interest income | (1,518) | (1,775) | (184) | |||
| Income tax expense (benefit) | 42,411 | (7,748) | 39,591 | |||
| Depreciation, depletion and amortization | 29,423 | 23,930 | 28,035 | |||
| Non-cash stock compensation expense | 3,034 | 3,381 | 1,182 | |||
| Mark-to-market adjustment - acquisition-related obligations | — | (1,735) | 9,361 | |||
| Accretion on asset retirement obligations | 6,377 | 5,943 | 5,954 | |||
| Amortization of acquired intangibles, net | 2,197 | 3,460 | 5,748 | |||
| Adjusted EBITDA | $ | 354,415 | $ | 247,883 | $ | 503,661 |
ALPHA METALLURGICAL RESOURCES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS
| Three Months Ended March 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| (In thousands, except for per ton data) | Met | All Other | Consolidated | |||
| Coal revenues | $ | 887,007 | $ | 19,691 | $ | 906,698 |
| Less: Freight and handling fulfillment revenues | (106,252) | (225) | (106,477) | |||
| Non-GAAP Coal revenues | $ | 780,755 | $ | 19,466 | $ | 800,221 |
| Tons sold | 3,737 | 178 | 3,915 | |||
| Non-GAAP Coal sales realization per ton | $ | 208.93 | $ | 109.36 | $ | 204.40 |
| Cost of coal sales (exclusive of items shown separately below) | $ | 522,998 | $ | 16,139 | $ | 539,137 |
| Depreciation, depletion and amortization - production (1) | 28,879 | 258 | 29,137 | |||
| Accretion on asset retirement obligations | 3,722 | 2,655 | 6,377 | |||
| Amortization of acquired intangibles, net | 2,197 | — | 2,197 | |||
| Total Cost of coal sales | $ | 557,796 | $ | 19,052 | $ | 576,848 |
| Less: Freight and handling costs | (106,252) | (225) | (106,477) | |||
| Less: Depreciation, depletion and amortization - production (1) | (28,879) | (258) | (29,137) | |||
| Less: Accretion on asset retirement obligations | (3,722) | (2,655) | (6,377) | |||
| Less: Amortization of acquired intangibles, net | (2,197) | — | (2,197) | |||
| Less: Idled and closed mine costs | (3,578) | (2,620) | (6,198) | |||
| Non-GAAP Cost of coal sales | $ | 413,168 | $ | 13,294 | $ | 426,462 |
| Tons sold | 3,737 | 178 | 3,915 | |||
| Non-GAAP Cost of coal sales per ton | $ | 110.56 | $ | 74.69 | $ | 108.93 |
(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.
| Three Months Ended March 31, 2023 | ||||||
|---|---|---|---|---|---|---|
| (In thousands, except for per ton data) | Met | All Other | Consolidated | |||
| Coal revenues | $ | 887,007 | $ | 19,691 | $ | 906,698 |
| Less: Total Cost of coal sales (per table above) | (557,796) | (19,052) | (576,848) | |||
| GAAP Coal margin | $ | 329,211 | $ | 639 | $ | 329,850 |
| Tons sold | 3,737 | 178 | 3,915 | |||
| GAAP Coal margin per ton | $ | 88.09 | $ | 3.59 | $ | 84.25 |
| GAAP Coal margin | $ | 329,211 | $ | 639 | $ | 329,850 |
| Add: Depreciation, depletion and amortization - production (1) | 28,879 | 258 | 29,137 | |||
| Add: Accretion on asset retirement obligations | 3,722 | 2,655 | 6,377 | |||
| Add: Amortization of acquired intangibles, net | 2,197 | — | 2,197 | |||
| Add: Idled and closed mine costs | 3,578 | 2,620 | 6,198 | |||
| Non-GAAP Coal margin | $ | 367,587 | $ | 6,172 | $ | 373,759 |
| Tons sold | 3,737 | 178 | 3,915 | |||
| Non-GAAP Coal margin per ton | $ | 98.36 | $ | 34.67 | $ | 95.47 |
(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.
| Three Months Ended December 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| (In thousands, except for per ton data) | Met | All Other | Consolidated | |||
| Coal revenues | $ | 804,876 | $ | 16,266 | $ | 821,142 |
| Less: Freight and handling fulfillment revenues | (105,911) | 1 | (105,910) | |||
| Non-GAAP Coal revenues | $ | 698,965 | $ | 16,267 | $ | 715,232 |
| Tons sold | 3,752 | 129 | 3,881 | |||
| Non-GAAP Coal sales realization per ton | $ | 186.29 | $ | 126.10 | $ | 184.29 |
| Cost of coal sales (exclusive of items shown separately below) | $ | 541,547 | $ | 7,596 | $ | 549,143 |
| Depreciation, depletion and amortization - production (1) | 19,575 | 4,083 | 23,658 | |||
| Accretion on asset retirement obligations | 3,412 | 2,531 | 5,943 | |||
| Amortization of acquired intangibles, net | 2,517 | 943 | 3,460 | |||
| Total Cost of coal sales | $ | 567,051 | $ | 15,153 | $ | 582,204 |
| Less: Freight and handling costs | (105,911) | 1 | (105,910) | |||
| Less: Depreciation, depletion and amortization - production (1) | (19,575) | (4,083) | (23,658) | |||
| Less: Accretion on asset retirement obligations | (3,412) | (2,531) | (5,943) | |||
| Less: Amortization of acquired intangibles, net | (2,517) | (943) | (3,460) | |||
| Less: Idled and closed mine costs | (11,754) | 2,821 | (8,933) | |||
| Non-GAAP Cost of coal sales | $ | 423,882 | $ | 10,418 | $ | 434,300 |
| Tons sold | 3,752 | 129 | 3,881 | |||
| Non-GAAP Cost of coal sales per ton | $ | 112.97 | $ | 80.76 | $ | 111.90 |
(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.
| Three Months Ended December 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| (In thousands, except for per ton data) | Met | All Other | Consolidated | |||
| Coal revenues | $ | 804,876 | $ | 16,266 | $ | 821,142 |
| Less: Total Cost of coal sales (per table above) | (567,051) | (15,153) | (582,204) | |||
| GAAP Coal margin | $ | 237,825 | $ | 1,113 | $ | 238,938 |
| Tons sold | 3,752 | 129 | 3,881 | |||
| GAAP Coal margin per ton | $ | 63.39 | $ | 8.63 | $ | 61.57 |
| GAAP Coal margin | $ | 237,825 | $ | 1,113 | $ | 238,938 |
| Add: Depreciation, depletion and amortization - production (1) | 19,575 | 4,083 | 23,658 | |||
| Add: Accretion on asset retirement obligations | 3,412 | 2,531 | 5,943 | |||
| Add: Amortization of acquired intangibles, net | 2,517 | 943 | 3,460 | |||
| Add: Idled and closed mine costs | 11,754 | (2,821) | 8,933 | |||
| Non-GAAP Coal margin | $ | 275,083 | $ | 5,849 | $ | 280,932 |
| Tons sold | 3,752 | 129 | 3,881 | |||
| Non-GAAP Coal margin per ton | $ | 73.32 | $ | 45.34 | $ | 72.39 |
(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.
| Three Months Ended March 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| (In thousands, except for per ton data) | Met | All Other | Consolidated | |||
| Coal revenues | $ | 1,054,340 | $ | 15,398 | $ | 1,069,738 |
| Less: Freight and handling fulfillment revenues | (144,025) | (18) | (144,043) | |||
| Non-GAAP Coal revenues | $ | 910,315 | $ | 15,380 | $ | 925,695 |
| Tons sold | 3,780 | 268 | 4,048 | |||
| Non-GAAP Coal sales realization per ton | $ | 240.82 | $ | 57.39 | $ | 228.68 |
| Cost of coal sales (exclusive of items shown separately below) | $ | 539,282 | $ | 16,060 | $ | 555,342 |
| Depreciation, depletion and amortization - production (1) | 27,060 | 797 | 27,857 | |||
| Accretion on asset retirement obligations | 3,398 | 2,556 | 5,954 | |||
| Amortization of acquired intangibles, net | 4,796 | 952 | 5,748 | |||
| Total Cost of coal sales | $ | 574,536 | $ | 20,365 | $ | 594,901 |
| Less: Freight and handling costs | (144,025) | (18) | (144,043) | |||
| Less: Depreciation, depletion and amortization - production (1) | (27,060) | (797) | (27,857) | |||
| Less: Accretion on asset retirement obligations | (3,398) | (2,556) | (5,954) | |||
| Less: Amortization of acquired intangibles, net | (4,796) | (952) | (5,748) | |||
| Less: Idled and closed mine costs | (3,604) | (2,671) | (6,275) | |||
| Non-GAAP Cost of coal sales | $ | 391,653 | $ | 13,371 | $ | 405,024 |
| Tons sold | 3,780 | 268 | 4,048 | |||
| Non-GAAP Cost of coal sales per ton | $ | 103.61 | $ | 49.89 | $ | 100.06 |
(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.
| Three Months Ended March 31, 2022 | ||||||
|---|---|---|---|---|---|---|
| (In thousands, except for per ton data) | Met | All Other | Consolidated | |||
| Coal revenues | $ | 1,054,340 | $ | 15,398 | $ | 1,069,738 |
| Less: Total Cost of coal sales (per table above) | (574,536) | (20,365) | (594,901) | |||
| GAAP Coal margin | $ | 479,804 | $ | (4,967) | $ | 474,837 |
| Tons sold | 3,780 | 268 | 4,048 | |||
| GAAP Coal margin per ton | $ | 126.93 | $ | (18.53) | $ | 117.30 |
| GAAP Coal margin | $ | 479,804 | $ | (4,967) | $ | 474,837 |
| Add: Depreciation, depletion and amortization - production (1) | 27,060 | 797 | 27,857 | |||
| Add: Accretion on asset retirement obligations | 3,398 | 2,556 | 5,954 | |||
| Add: Amortization of acquired intangibles, net | 4,796 | 952 | 5,748 | |||
| Add: Idled and closed mine costs | 3,604 | 2,671 | 6,275 | |||
| Non-GAAP Coal margin | $ | 518,662 | $ | 2,009 | $ | 520,671 |
| Tons sold | 3,780 | 268 | 4,048 | |||
| Non-GAAP Coal margin per ton | $ | 137.21 | $ | 7.50 | $ | 128.62 |
(1) Depreciation, depletion and amortization - production excludes the depreciation, depletion and amortization related to selling, general and administrative functions.
| Three Months Ended March 31, 2023 | |||||||
|---|---|---|---|---|---|---|---|
| (In thousands, except for per ton data) | Tons Sold | Coal Revenues | Non-GAAP Coal sales realization per ton | % of Met Tons Sold | |||
| Export - other pricing mechanisms | 1,558 | $ | 329,225 | $ | 211.31 | 44 | % |
| Domestic | 1,070 | 206,385 | $ | 192.88 | 30 | % | |
| Export - Australian indexed | 897 | 215,964 | $ | 240.76 | 26 | % | |
| Total Met segment - met coal | 3,525 | 751,574 | $ | 213.21 | 100 | % | |
| Met segment - thermal coal | 212 | 29,181 | $ | 137.65 | |||
| Total Met segment Coal revenues | 3,737 | 780,755 | $ | 208.93 | |||
| All Other Coal revenues | 178 | 19,466 | $ | 109.36 | |||
| Non-GAAP Coal revenues | 3,915 | 800,221 | $ | 204.40 | |||
| Add: Freight and handling fulfillment revenues | — | 106,477 | |||||
| Coal revenues | 3,915 | $ | 906,698 |