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Jun 30, 2023
Warrior Met Coal Q2 2023 Earnings Report
Reported momentum in its business despite end-user demand headwinds.
Key Takeaways
Warrior Met Coal reported a net income of $82.1 million for Q2 2023, with sales volumes up 15% to 1.8 million short tons and production reaching 1.9 million short tons. However, the average net realized price decreased to $208.56 per short ton, impacting total revenues.
Net income decreased to $82.1 million, or $1.58 per diluted share, compared to $297.0 million, or $5.74 per diluted share in Q2 2022.
Sales volumes increased by 15% to 1.8 million short tons.
Production ramped up to 1.9 million short tons, the largest since Q1 2021.
Average net realized price decreased to $208.56 per short ton from $403.95 per short ton in Q2 2022.
Forward Guidance
Warrior Met Coal updated its full year 2023 guidance, including coal sales of 7.1 - 7.7 million short tons, coal production of 6.8 - 7.4 million short tons, cash cost of sales (free-on-board port) of $113 - $125 per short ton, and capital expenditures for existing mines of $95 - $105 million.
Positive Outlook
- Strong customer demand for steelmaking coal.
- Improved performance at the McDuffie Terminal.
- Increased production due to adjusted work schedules.
- Addition of approximately 250 eligible union-represented workers.
- Development of Blue Creek mine to lower operating costs and increase flexibility.
Challenges Ahead
- Softening steelmaking coal prices.
- Inflationary cost increases in operating expenses and capital expenditures.
- Ongoing expenses related to legal and labor negotiations.
- Potential mechanical issues at the McDuffie Terminal at the Port of Mobile.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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