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Jun 30, 2022
Ramaco Q2 2022 Earnings Report
Reported a strong second quarter with significant increases in net income and Adjusted EBITDA compared to the previous year.
Key Takeaways
Ramaco Resources reported a strong second quarter in 2022, with net income of $33.3 million and Adjusted EBITDA of $57.9 million, representing increases of 235% and 220% respectively compared to the second quarter of 2021. The company built approximately 90,000 tons of inventory due to logistical issues, and has booked total 2022 sales of roughly 2.8 million tons as of August 4 at an average sales price of roughly $214 per ton.
Net income was $33.3 million (diluted EPS of $0.74), a 235% increase over the previous second quarter.
Adjusted EBITDA was $57.9 million, a 220% increase over the previous second quarter.
Approximately 90,000 tons of inventory were built during the quarter due to logistical issues.
Total 2022 sales were booked at roughly 2.8 million tons as of August 4 at an average sales price of roughly $214 per ton.
Forward Guidance
Ramaco Resources is adjusting its longer-term guidance to reflect a three-year target of achieving roughly 6.5 million tons of production by 2025 and expects to have a record year in 2022.
Positive Outlook
- Company is poised to have a record second half and full-year 2022, with financial metrics at multiples of 2021.
- Company is in growth mode with a goal to increase production to meet future demand for high quality met coal.
- Company is adjusting longer-term guidance to reflect a three-year target of achieving roughly 6.5 million tons of production by 2025.
- This increase will be financed from internally generated cash flow.
- Company intends to sell coal into whatever markets will yield the best netback pricing for 2023.
Challenges Ahead
- First half delivered sales suffered from poor rail service.
- Company built almost 90,000 tons of inventory during the second quarter of 2022, compounding the same logistical issue from the first quarter.
- Had the rails performed, results would have been even stronger and closer to consensus projections.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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