Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2021 | May 03, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-38061 | |
Entity Registrant Name | Warrior Met Coal, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-0706839 | |
Entity Address, Address Line One | 16243 Highway 216 | |
Entity Address, City or Town | Brookwood | |
Entity Address, State or Province | AL | |
Entity Address, Postal Zip Code | 35444 | |
City Area Code | 205 | |
Local Phone Number | 554-6150 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 51,408,956 | |
Entity Central Index key | 0001691303 | |
Document Fiscal Year Focus | 2021 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | HCC | |
Security Exchange Name | NYSE | |
Preferred Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Rights to Purchase Series A Junior Participating Preferred Stock, par value $0.01 per share | |
Security Exchange Name | NYSE | |
No Trading Symbol Flag | true |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues: | ||
Total revenues | $ 213,764 | $ 226,720 |
Costs and expenses: | ||
Cost of sales (exclusive of items shown separately below) | 154,350 | 151,514 |
Cost of other revenues (exclusive of items shown separately below) | 7,795 | 7,561 |
Depreciation and depletion | 32,903 | 28,692 |
Selling, general and administrative | 7,637 | 8,456 |
Total costs and expenses | 202,685 | 196,223 |
Operating income | 11,079 | 30,497 |
Interest expense, net | (8,693) | (7,533) |
Other income (expense) | (109) | 1,822 |
Income before income tax expense | 2,277 | 24,786 |
Income tax expense | 23,632 | 3,241 |
Net (loss) income | $ (21,355) | $ 21,545 |
Basic and diluted net (loss) income per share: | ||
Net (loss) income per share-basic (in dollars per share) | $ (0.42) | $ 0.42 |
Net (loss) income per share-diluted (in dollars per share) | $ (0.42) | $ 0.42 |
Weighted average number of shares outstanding-basic (in shares) | 51,274 | 51,106 |
Weighted average number of shares outstanding-diluted (in shares) | 51,274 | 51,273 |
Dividends per share (in dollars per share) | $ 0.05 | $ 0.05 |
Sales | ||
Revenues: | ||
Total revenues | $ 206,989 | $ 221,338 |
Other revenues | ||
Revenues: | ||
Total revenues | $ 6,775 | $ 5,382 |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 221,947 | $ 211,916 |
Short-term investments | 8,504 | 8,504 |
Trade accounts receivable | 76,120 | 83,298 |
Inventories, net | 135,696 | 118,713 |
Prepaid expenses and other receivables | 34,859 | 45,052 |
Total current assets | 477,126 | 467,483 |
Mineral interests, net | 98,395 | 100,855 |
Property, plant and equipment, net | 640,732 | 637,108 |
Deferred income taxes | 150,741 | 174,372 |
Other long-term assets | 12,997 | 14,118 |
Total assets | 1,379,991 | 1,393,936 |
Current liabilities: | ||
Accounts payable | 65,336 | 59,110 |
Accrued expenses | 62,901 | 86,108 |
Short term financing lease liabilities | 23,619 | 14,385 |
Other current liabilities | 9,107 | 10,715 |
Total current liabilities | 160,963 | 170,318 |
Long-term debt | 380,098 | 379,908 |
Asset retirement obligations | 60,746 | 57,553 |
Long term financing lease liabilities | 40,662 | 24,091 |
Other long-term liabilities | 37,219 | 36,825 |
Total liabilities | 679,688 | 668,695 |
Stockholders’ Equity: | ||
Common stock, $0.01 par value per share (Authorized -140,000,000 shares as of March 31, 2021 and December 31, 2020, 53,567,566 issued and 51,345,725 outstanding as of March 31, 2021 and 53,408,040 issued and 51,186,199 outstanding as of December 31, 2020) | 536 | 534 |
Preferred stock, $0.01 par value per share (10,000,000 shares authorized, no shares issued and outstanding) | 0 | 0 |
Treasury stock, at cost (2,221,841 shares as of March 31, 2021 and December 31, 2020) | (50,576) | (50,576) |
Additional paid in capital | 248,774 | 249,746 |
Retained earnings | 501,569 | 525,537 |
Total stockholders’ equity | 700,303 | 725,241 |
Total liabilities and stockholders’ equity | $ 1,379,991 | $ 1,393,936 |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock shares authorized (in shares) | 140,000,000 | 140,000,000 |
Common stock shares issued (in shares) | 53,567,566 | 53,408,040 |
Common stock shares outstanding (in shares) | 51,345,725 | 51,186,199 |
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock shares issued (in shares) | 0 | 0 |
Preferred stock shares outstanding (in shares) | 0 | 0 |
Treasury stock (in shares) | 2,221,841 | 2,221,841 |
CONDENSED STATEMENTS OF CHANGES
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Common Stock | Preferred Stock | Treasury Stock | Additional Paid in Capital | Retained Earnings |
Balance at beginning of period at Dec. 31, 2019 | $ 533 | $ 0 | $ (50,576) | $ 243,932 | $ 571,693 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of shares | 0 | |||||
Stock compensation | 1,605 | |||||
Other | (1,012) | |||||
Net (loss) income | $ 21,545 | 21,545 | ||||
Dividends paid | (2,598) | |||||
Balance at end of period at Mar. 31, 2020 | 785,122 | 533 | 0 | (50,576) | 244,525 | 590,640 |
Balance at beginning of period at Dec. 31, 2020 | 725,241 | 534 | 0 | (50,576) | 249,746 | 525,537 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of shares | 2 | |||||
Stock compensation | 1,567 | |||||
Other | (2,539) | |||||
Net (loss) income | (21,355) | (21,355) | ||||
Dividends paid | (2,613) | |||||
Balance at end of period at Mar. 31, 2021 | $ 700,303 | $ 536 | $ 0 | $ (50,576) | $ 248,774 | $ 501,569 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
OPERATING ACTIVITIES | ||
Net (loss) income | $ (21,355) | $ 21,545 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and depletion | 32,903 | 28,692 |
Deferred income tax expense | 23,632 | 3,276 |
Stock based compensation expense | 1,696 | 1,733 |
Amortization of debt issuance costs and debt discount/premium, net | 425 | 351 |
Accretion of asset retirement obligations | 805 | 733 |
Changes in operating assets and liabilities: | ||
Trade accounts receivable | 7,178 | (32,055) |
Inventories | (16,107) | (17,326) |
Prepaid expenses and other receivables | 10,192 | (235) |
Accounts payable | 4,964 | 15,614 |
Accrued expenses and other current liabilities | (5,463) | (3,538) |
Other | 6,352 | 2,232 |
Net cash provided by operating activities | 45,222 | 21,022 |
INVESTING ACTIVITIES | ||
Purchase of property, plant and equipment | (9,479) | (22,775) |
Deferred mine development costs | (12,333) | (3,677) |
Proceeds from sale of property, plant and equipment | 20 | 0 |
Sale of short-term investments | 0 | 14,733 |
Purchases of short-term investments | 0 | (8,500) |
Net cash used in investing activities | (21,792) | (20,219) |
FINANCING ACTIVITIES | ||
Dividends paid | (2,613) | (2,598) |
Borrowings under ABL Facility | 0 | 70,000 |
Principal repayments of finance lease obligations | (8,247) | (3,833) |
Other | (2,539) | (1,012) |
Net cash (used in) provided by financing activities | (13,399) | 62,557 |
Net increase in cash and cash equivalents | 10,031 | 63,360 |
Cash and cash equivalents at beginning of period | 211,916 | 193,383 |
Cash and cash equivalents at end of period | $ 221,947 | $ 256,743 |
Business and Basis of Presentat
Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Basis of Presentation | Business and Basis of Presentation Description of the Business Warrior Met Coal, Inc. (the "Company") is a U.S. based environmentally and socially minded supplier to the global steel industry. The Company is dedicated entirely to mining non-thermal met coal used as a critical component of steel production by metal manufacturers in Europe, South America and Asia. The Company also generates ancillary revenues from the sale of natural gas extracted as a byproduct from the underground coal mines and royalty revenues from leased properties. Basis of Presentation The accompanying financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion, the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. For further information, refer to the financial statements and related notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 (the "2020 Annual Report"). Operating results for the three months ended March 31, 2021 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2021. The balance sheet at December 31, 2020 has been derived from the audited financial statements for the year ended December 31, 2020 included in the 2020 Annual Report. Impact of the COVID-19 Pandemic Upon our Financial Condition and Results of Operations The global steelmaking industry's demand for met coal is affected by pandemics, epidemics or other public health emergencies, such as the recent outbreak of the novel coronavirus disease 2019 ("COVID-19"), which has spread from China to many other countries including the United States. In March 2020, the World Health Organization ("WHO") declared COVID-19 as a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. The outbreak has resulted in governments around the world implementing increasingly stringent measures to help control the spread of the virus, including quarantines, "shelter in place" and "stay at home" orders, travel restrictions, business curtailments, school closures, and other measures. In addition, governments and central banks in several parts of the world have enacted fiscal and monetary stimulus measures to counteract the impacts of COVID-19. The Company operates in a critical infrastructure industry, as defined by the U.S. Department of Homeland Security. As such, the Company continues to operate its mines in a safe manner under the guidelines issued by the Centers for Disease Control and Prevention and the Alabama State Health Department. In response to these measures and for the protection of employees, the Company has taken steps to ensure our employees remain safe. As of the filing of this Form 10-Q, the Company has not had to idle or temporarily idle its mines as a result of COVID-19. COVID-19 has had and may continue to have further negative impacts on our two operating mines, supply chain, transportation networks and customers, which may continue to compress our margins, and reduce demand for the met coal that we produce. The COVID-19 outbreak is a widespread public health crisis that is adversely affecting the economies and financial markets of many countries, including those of our customers, which are primarily located in Europe, South America and Asia. A prolonged economic downturn could adversely affect demand for our met coal and contribute to volatile supply and demand conditions affecting prices and volumes. The progression of COVID-19 could also negatively impact our business or results of operations through the temporary closure of one of our mines, customers or critical suppliers, or the McDuffie Coal Terminal at the Port of Mobile, Alabama, or a disruption to our rail and barge carriers, which would delay or prevent deliveries to our customers, among others. In addition, the ability of our employees and our suppliers' and customers' employees to work may be significantly impacted by individuals contracting or being exposed to COVID-19, or as a result of the control measures noted above, which may significantly affect the demand for met coal. Our customers may be directly impacted by business curtailments or weak market conditions and may not be willing or able to fulfill their contractual obligations or open letters of credit. We may also experience delays in obtaining letters of credit or processing letter of credit payments due to the impacts of COVID-19 on foreign issuing and U.S. intermediary banks. Furthermore, the progression of, and global response to, the COVID-19 outbreak has begun to cause, and increases the risk of, further delays in construction activities and equipment deliveries related to our |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The Company's significant accounting policies are consistent with those disclosed in Note 2 to its audited financial statements included in the 2020 Annual Report, except for changes related to new accounting pronouncements described in "New Accounting Pronouncements." Cash and Cash Equivalents Cash and cash equivalents include short-term deposits and highly liquid investments that have original maturities of three months or less when purchased and are stated at cost, which approximates fair value. Short-Term Investments Instruments with maturities greater than three months, but less than twelve months, are included in short-term investments. The Company purchases United States Treasury bills with maturities ranging from six to twelve months which are classified as held to maturity and are carried at amortized cost, which approximates fair value. The Company also purchases fixed income securities and certificates of deposits with varying maturities that are classified as available for sale and are carried at fair value. Securities classified as held to maturity are those securities that management has the intent and ability to hold to maturity. As of March 31, 2021 and December 31, 2020, short-term investments consisted of $8.5 million in cash and fixed income securities. The short-term investments are posted as collateral for the self-insured black lung related claims asserted by or on behalf of former employees of Walter Energy, Inc. ("Walter Energy") and its subsidiaries, which were assumed by the Company and relate to periods prior to March 31, 2016. Revenue Recognition Revenue is recognized when performance obligations under the terms of a contract with the Company's customers are satisfied; for all contracts this occurs when control of the promised goods have been transferred to its customers. For coal shipments to domestic customers via rail, control is transferred when the railcar is loaded. For coal shipments to international customers via ocean vessel, control is transferred when the vessel is loaded at the Port of Mobile, Alabama. For natural gas sales, control is transferred when the gas has been transferred to the pipeline. Revenue is disaggregated between coal sales within the Company's mining segment and natural gas sales which is included in all other revenues, as disclosed in Note 13. Since February 2017, the Company has had an arrangement with XCoal Energy & Resources ("XCoal") to serve as XCoal's strategic partner for exports of low-volatility hard coking coal. Under this arrangement, XCoal takes title to and markets coal that the Company would historically have sold on the spot market, in an amount of the greater of (i) 10% of the Company's total production during the applicable term of the arrangement or (ii) 250,000 metric tons. During the three months ended March 31, 2021 and 2020, XCoal accounted for approximately $106.2 million, or 50.9% of total sales, and $44.3 million, or 19.9% of total sales, respectively. Trade Accounts Receivable and Allowance for Credit Losses Trade accounts receivable represent customer obligations that are derived from revenue recognized from contracts with customers. Credit is extended based on an evaluation of the individual customer's financial condition. The Company maintains trade credit insurance on the majority of its customers and the geographic regions of coal shipments to these customers. In some instances, the Company requires letters of credit, cash collateral or prepayments from its customers on or before shipment to mitigate the risk of loss. These efforts have consistently resulted in the Company recognizing no historical credit losses. The Company also has never had to have a claim against its trade credit insurance policy. In order to estimate the allowance for credit losses on trade accounts receivable, the Company utilizes an aging approach in which potential impairment is calculated based on how long a receivable has been outstanding (e.g., current, 1-31, 31-60, etc.). The Company calculates an expected credit loss rate based on the Company’s historical credit loss rate, the risk characteristics of our customers, and the current metallurgical coal and steel market environments. As of March 31, 2021 and December 31, 2020, the estimated allowance for credit losses was immaterial and did not have a material impact on the Company's financial statements. New Accounting Pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued ASU 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. This ASU removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. The ASU is effective for fiscal years beginning after December 15, 2020. The Company adopted the standard as of January 1, 2021 with no material impact to the Company's results of operations, financial condition, cash flows or financial statement presentation. |
Inventories, net
Inventories, net | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories, net | Inventories, net Inventories, net are summarized as follows (in thousands): March 31, 2021 December 31, 2020 Coal $ 102,058 $ 86,272 Raw materials, parts, supplies and other, net 33,638 32,441 Total inventories, net $ 135,696 $ 118,713 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three months ended March 31, 2021, the Company utilized a discrete period method to calculate taxes, as it does not believe that the annual effective tax rate method represents a reliable estimate given the current uncertainty surrounding the COVID-19 pandemic, the Chinese ban on Australian coal and other potentially disruptive factors and its impact on the Company's annual guidance. For the three months ended March 31, 2021, the Company had an income tax expense of $23.6 million. The income tax expense of $23.6 million is due to the establishment of a non-cash $47.8 million state deferred income tax asset valuation allowance, discussed below, offset partially by a net non-cash income tax benefit of $22.9 million due to the remeasurement of state deferred income tax assets and liabilities and $1.3 million of net income tax benefit from the Internal Revenue Code ("IRC") Section 45I Marginal Well Credit, depletion and other adjustments. The Marginal Well Credit is a production-based tax credit that provides a credit for qualified natural gas production. The credit is phased out when natural gas prices exceed certain levels. The Company had income tax expense of $3.2 million for the three months ended March 31, 2020. On February 12, 2021, the Alabama Governor signed into law Alabama House Bill 170, now Act 2021-1 (the "Act"). The Act makes several changes to the state’s business tax structure. Among the provisions of the Act, is the repeal of the so-called corporate income tax “throwback rule.” That rule required all sales originating in Alabama and delivered to a jurisdiction where the seller was not subject to tax, to be included in the seller’s Alabama income tax base. Thus, prior to repeal of the throwback rule, the Company had to rely on its Alabama NOL carryforwards to shelter taxes imposed under such throwback rule. As a result of the now repealed throwback rule, effective January 1, 2021, all such sales should now be excluded from Alabama taxable income without the need to utilize Alabama NOLs. As a result of the repeal of the throwback rule, the Company has remeasured its Alabama deferred income tax assets and liabilities and recorded the non-cash income tax benefit noted above of $22.9 million. Additionally, the Company determined that it is not more likely than not that the Company would have sufficient taxable income to utilize all of the Company’s Alabama deferred income tax assets prior to expiration. Therefore, as of March 31, 2021, the Company established a non-cash valuation allowance of $47.8 million against such deferred income tax assets. The following table shows the balance of our state deferred income tax asset valuation allowance and the associated activity during the three months ended March 31, 2021: March 31, 2021 Beginning balance $ — Addition - current tax expense 47,787 Ending balance $ 47,787 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consisted of the following (in thousands): March 31, December 31, 2020 Weighted Average Interest Rate at March 31, 2021 Final Maturity Senior Secured Notes $ 343,435 $ 343,435 8% 2024 ABL Borrowings 40,000 40,000 4% 2023 Debt discount/premium, net (3,337) (3,527) Total debt 380,098 379,908 Less: current debt — — Total long-term debt $ 380,098 $ 379,908 Senior Secured Notes On November 2, 2017, the Company issued $350.0 million aggregate principal amount of its 8.00% Senior Secured Notes due 2024 (the "Original Notes"). It then issued an additional $125.0 million in aggregate principal amount of its 8.00% Senior Secured Notes due 2024 (the “New Notes” and, together with the Original Notes, the "Notes") on March 1, 2018. The New Notes were issued as "Additional Notes" under the indenture dated as of November 2, 2017 (the "Original Indenture"), among the Company, the subsidiary guarantors party thereto and Wilmington Trust, National Association, as trustee and priority lien collateral trustee, as supplemented by the First Supplemental Indenture, dated as of March 1, 2018 (the "First Supplemental Indenture" and, the Original Indenture as supplemented thereby and by the Second Supplemental Indenture, dated as of March 2, 2018, the "Indenture"). The Notes mature on November 1, 2024 and interest is payable on May 1 and November 1 of each year. ABL Facility |
Other Long-Term Liabilities
Other Long-Term Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | Other Long-Term Liabilities Other long-term liabilities are summarized as follows (in thousands): March 31, 2021 December 31, 2020 Black lung obligations $ 34,518 $ 34,567 Other 2,701 2,258 Total other long-term liabilities $ 37,219 $ 36,825 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Leases | Leases The Company primarily enters into rental agreements for certain mining equipment that are for periods of 12 months or less, some of which include options to extend the leases. Leases that are for periods of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense on these agreements on a straight-line basis over the lease term. Additionally, the Company has certain finance leases for mining equipment that expire over various contractual periods. The leases have remaining lease terms of one Supplemental balance sheet information related to leases was as follows (in thousands): March 31, 2021 December 31, 2020 Finance lease right-of-use assets, net (1) $ 77,921 $ 46,746 Finance lease liabilities Current 23,619 14,385 Noncurrent 40,662 24,091 Total finance lease liabilities $ 64,281 $ 38,476 Weighted average remaining lease term - finance leases (in months) 40.4 42.9 Weighted average discount rate - finance leases (2) 6.28 % 5.77 % (1) Finance lease right-of-use assets are recorded net of accumulated amortization of $12.1 million and $9.8 million and are included in property, plant and equipment, net in the Condensed Balance Sheet as of March 31, 2021 and the Balance Sheet as of December 31, 2020, respectively. (2) When an implicit discount rate is not readily available in a lease, the Company uses its incremental borrowing rate based on information available at the commencement date when determining the present value of lease payments. The components of lease expense were as follows (in thousands): For the three months ended 2021 2020 Operating lease cost (1): $ 1,189 $ 292 Finance lease cost: Amortization of leased assets 4,125 2,998 Interest on lease liabilities 774 546 Net lease cost $ 6,088 $ 3,836 (1) Includes leases that are for periods of 12 months or less. Maturities of lease liabilities were as follows (in thousands): Finance Leases (1) 2021 $ 21,167 2022 24,761 2023 22,125 2024 2,557 2025 732 Thereafter — Total 71,342 Less: amount representing interest (7,061) Present value of lease liabilities $ 64,281 (1) Finance lease payments include $1.4 million of future payments required under signed lease agreements that have not yet commenced. Supplemental cash flow information related to leases was as follows (in thousands): For the three months ended 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 774 $ 546 Financing cash flows from finance leases $ 8,247 $ 3,833 Non-cash right-of-use assets obtained in exchange for lease obligations: Finance leases $ 35,288 $ 2,286 As of March 31, 2021, the Company had additional commitments for finance leases, primarily for mining equipment, that have not yet commenced of $1.4 million. These finance leases will commence during fiscal year 2021 with lease terms of one |
Leases | Leases The Company primarily enters into rental agreements for certain mining equipment that are for periods of 12 months or less, some of which include options to extend the leases. Leases that are for periods of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense on these agreements on a straight-line basis over the lease term. Additionally, the Company has certain finance leases for mining equipment that expire over various contractual periods. The leases have remaining lease terms of one Supplemental balance sheet information related to leases was as follows (in thousands): March 31, 2021 December 31, 2020 Finance lease right-of-use assets, net (1) $ 77,921 $ 46,746 Finance lease liabilities Current 23,619 14,385 Noncurrent 40,662 24,091 Total finance lease liabilities $ 64,281 $ 38,476 Weighted average remaining lease term - finance leases (in months) 40.4 42.9 Weighted average discount rate - finance leases (2) 6.28 % 5.77 % (1) Finance lease right-of-use assets are recorded net of accumulated amortization of $12.1 million and $9.8 million and are included in property, plant and equipment, net in the Condensed Balance Sheet as of March 31, 2021 and the Balance Sheet as of December 31, 2020, respectively. (2) When an implicit discount rate is not readily available in a lease, the Company uses its incremental borrowing rate based on information available at the commencement date when determining the present value of lease payments. The components of lease expense were as follows (in thousands): For the three months ended 2021 2020 Operating lease cost (1): $ 1,189 $ 292 Finance lease cost: Amortization of leased assets 4,125 2,998 Interest on lease liabilities 774 546 Net lease cost $ 6,088 $ 3,836 (1) Includes leases that are for periods of 12 months or less. Maturities of lease liabilities were as follows (in thousands): Finance Leases (1) 2021 $ 21,167 2022 24,761 2023 22,125 2024 2,557 2025 732 Thereafter — Total 71,342 Less: amount representing interest (7,061) Present value of lease liabilities $ 64,281 (1) Finance lease payments include $1.4 million of future payments required under signed lease agreements that have not yet commenced. Supplemental cash flow information related to leases was as follows (in thousands): For the three months ended 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 774 $ 546 Financing cash flows from finance leases $ 8,247 $ 3,833 Non-cash right-of-use assets obtained in exchange for lease obligations: Finance leases $ 35,288 $ 2,286 As of March 31, 2021, the Company had additional commitments for finance leases, primarily for mining equipment, that have not yet commenced of $1.4 million. These finance leases will commence during fiscal year 2021 with lease terms of one |
Net (Loss) Income per Share
Net (Loss) Income per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income per Share | Net (Loss) Income per Share Basic and diluted net (loss) income per share was calculated as follows (in thousands, except per share data): For the three months ended 2021 2020 Numerator: Net (loss) income $ (21,355) $ 21,545 Denominator: Weighted-average shares used to compute net (loss) income per share—basic 51,274 51,106 Dilutive restrictive stock awards (1) — 167 Weighted-average shares used to compute net (loss) income per share—diluted 51,274 51,273 Net (loss) income per share—basic $ (0.42) $ 0.42 Net (loss) income per share—diluted $ (0.42) $ 0.42 (1) In periods of net loss, the number of shares used to calculate diluted earnings per share is the same as basic earnings per share; therefore, the effect of dilutive securities is zero for such periods. On February 16, 2021, the Company awarded 398,945 restricted stock unit awards under the Company's 2017 Equity Incentive Plan (the "2017 Equity Plan"). These awards have certain service-based, performance-based and market-based vesting conditions, as applicable. The service-based awards vest over a period of three years and the performance-based and market-based awards are based on the Company's performance in each of the three years. As of March 31, 2021, there were 319,863 restricted stock unit awards for which the service-based vesting conditions for these awards were not met as of the measurement date. As such, these awards were excluded from basic earnings per share. As of March 31, 2021, there were 523,479 restricted stock unit awards for which the performance-based and market-based vesting conditions were not met as of the measurement date and, as such, these awards were excluded from basic and diluted earnings per share. Based on the Company's closing share price on March 31, 2021, there were 87,566 restricted stock unit awards classified as a liability. As of March 31, 2021, there were 27,431 restricted stock unit awards granted under the Company's 2016 Equity Incentive Plan (the "2016 Equity Plan") to certain directors and employees, for which the service-based vesting conditions for these awards were not met as of the measurement date. As such, these awards were excluded from basic earnings per share. As of March 31, 2021, there were 43,580 shares of the Company's common stock contingently issuable upon the settlement of a vested phantom unit award granted under our 2016 Equity Plan and 13,157 shares of its common stock contingently issuable upon the settlement of a vested restricted stock unit award under the 2017 Equity Plan. The settlement date for these awards is the earlier of a change in control as described in the 2016 Equity Plan or 2017 Equity Plan, as applicable, or five years from the grant date. These awards are vested and, as such, have been included in the weighted average shares used to compute basic and diluted net (loss) income per share. The phantom unit award settled on April 1, 2021. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsThe Company owns a 50% interest in Black Warrior Methane (“BWM”) and Black Warrior Transmission (“BWT”), which are accounted for under the proportionate consolidation method and equity method, respectively. The Company has granted the rights to produce and sell methane gas from its coal mines to BWM and BWT. The Company’s net investments in, advances to/from and equity in earnings or loss of BWT are not material to the Company. The Company supplied labor to BWM and incurred costs, including property and liability insurance, to support the joint venture. The Company charged the joint venture for such costs on a monthly basis, which totaled $0.8 million for the three months ended March 31, 2021 and $0.5 million for the three months ended March 31, 2020. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Environmental Matters The Company is subject to a wide variety of laws and regulations concerning the protection of the environment, both with respect to the construction and operation of its plants, mines and other facilities and with respect to remediating environmental conditions that may exist at its own and other properties. The Company believes it is in compliance with federal, state and local environmental laws and regulations. The Company accrues for environmental expenses resulting from existing conditions that relate to past operations when the costs are probable and can be reasonably estimated. As of March 31, 2021 and December 31, 2020, there were no accruals for environmental matters other than asset retirement obligations for mine reclamation. Miscellaneous Litigation From time to time, the Company is party to lawsuits arising in the ordinary course of their businesses. The Company records costs relating to these matters when a loss is probable and the amount can be reasonably estimated. The effect of the outcome of these matters on the Company’s future results of operations cannot be predicted with certainty as any such effect depends on future results of operations and the amount and timing of the resolution of such matters. As of March 31, 2021 and December 31, 2020, there were no items accrued for miscellaneous litigation. Walter Canada Settlement Proceeds On July 15, 2015, Walter Energy and certain of its wholly owned U.S. subsidiaries, including Jim Walter Resources, Inc. (“JWR”) filed voluntary petitions for relief under Chapter 11 of Title 11 of the U.S. Bankruptcy Code (the “Chapter 11 Cases”) in the Northern District of Alabama, Southern Division. On December 7, 2015, Walter Energy Canada Holdings, Inc., Walter Canadian Coal Partnership and their Canadian affiliates (collectively “Walter Canada”) applied for and were granted protection under the Companies’ Creditors Arrangement Act (the “CCAA”) pursuant to an Initial Order of the Supreme Court of British Columbia. In connection with the Company’s acquisition of certain core operating assets of Walter Energy, the Company acquired a receivable owed to Walter Energy by Walter Canada for certain shared services provided by Walter Energy to Walter Canada (the “Shared Services Claim”) and a receivable for unpaid interest owed to Walter Energy from Walter Canada in respect of a promissory note (the “Hybrid Debt Claim”). Each of these claims were asserted by the Company in the Walter Canada CCAA proceedings. Walter Energy deemed these receivables to be impaired for the year ended December 31, 2015 and the Company did not assign any value to these receivables in acquisition accounting as collectability was deemed remote. In March 2020, the Company received approximately $1.8 million in settlement proceeds for the Shared Services Claim and Hybrid Debt Claim which is reflected as other income in the Condensed Statement of Operations. The collectability of additional amounts, if any, related to the Shared Services Claim and Hybrid Debt Claim depends on the outcome of, and the timing of any resolutions of, the Walter Canada CCAA proceedings and cannot be predicted with certainty. Commitments and Contingencies—Other The Company is party to various transportation and throughput agreements with rail and barge transportation providers and the Alabama State Port Authority. These agreements contain annual minimum tonnage guarantees with respect to coal transported from the mine sites to the Port of Mobile, Alabama, the unloading of rail cars or barges, and the loading of vessels. If the Company does not meet its minimum throughput obligations, which are based on annual minimum amounts, it is required to pay the transportation providers or the Alabama State Port Authority a contractually specified amount per metric ton for the difference between the actual throughput and the minimum throughput requirement. At March 31, 2021 and December 31, 2020, the Company had no liability recorded for minimum throughput requirements. Royalty Obligations |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' Equity Stock Repurchase Program On March 26, 2019, the Company's board of directors (the "Board") approved the Company's second stock repurchase program (the “Stock Repurchase Program”) that authorizes repurchases of up to an aggregate of $70.0 million of the Company's outstanding common stock. The Company fully exhausted its previous stock repurchase program of $40.0 million of its outstanding common stock. The Stock Repurchase Program does not require the Company to repurchase a specific number of shares or have an expiration date. The Stock Repurchase Program may be suspended or discontinued by the Board at any time without prior notice. Under the Stock Repurchase Program, the Company may repurchase shares of its common stock from time to time, in amounts, at prices and at such times as the Company deems appropriate, subject to market and industry conditions, share price, regulatory requirements as determined from time to time by the Company and other considerations. The Company’s repurchases may be executed using open market purchases or privately negotiated transactions in accordance with applicable securities laws and regulations, including Rule 10b-18 of the Exchange Act and repurchases may be executed pursuant to Rule 10b5-1 under the Exchange Act. Repurchases will be subject to limitations in the ABL Facility and the Indenture. The Company intends to fund repurchases under the Stock Repurchase Program from cash on hand and/or other sources of liquidity. As of March 31, 2021, the Company has repurchased 500,000 shares for approximately $10.6 million, leaving approximately $58.8 million of share repurchases authorized under the Stock Repurchase Program. In light of the uncertainties resulting from COVID-19 and as a precautionary measure to preserve liquidity, the Company has temporarily suspended its share repurchase program. The Company will continue to monitor its liquidity in light of the COVID-19 pandemic and will consider when to reinstate the program. Regular Quarterly Dividend On February 18, 2021, the Board declared a regular quarterly cash dividend of $0.05 per share, totaling $2.6 million, which was paid on March 8, 2021, to stockholders of record as of the close of business on March 1, 2021. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company had no assets or any other liabilities measured at fair value on a recurring basis as of March 31, 2021 or December 31, 2020. The following methods and assumptions were used to estimate the fair value for which the fair value option was not elected: Cash and cash equivalents, short-term investments, receivables and trade accounts payable— The carrying amounts reported in the Condensed Balance Sheets approximate fair value due to the short-term nature of these assets and liabilities. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company identifies a business as an operating segment if: (i) it engages in business activities from which it may earn revenues and incur expenses; (ii) its operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”), who is the Company’s Chief Executive Officer, to make decisions about resources to be allocated to the segment and assess its performance; and (iii) it has available discrete financial information. The Company has determined that its two underground mining operations are its operating segments. The CODM reviews financial information at the operating segment level to allocate resources and to assess the operating results and financial performance for each operating segment. Operating segments are aggregated into a reportable segment if the operating segments have similar quantitative economic characteristics and if the operating segments are similar in the following qualitative characteristics: (i) nature of products and services; (ii) nature of production processes; (iii) type or class of customer for their products and services; (iv) methods used to distribute the products or provide services; and (v) if applicable, the nature of the regulatory environment. The Company has determined that the two operating segments are similar in both quantitative and qualitative characteristics and thus the two operating segments have been aggregated into one reportable segment. The Company has determined that its natural gas and royalty businesses did not meet the criteria in ASC 280 to be considered as operating or reportable segments. Therefore, the Company has included their results in an “all other” category as a reconciling item to consolidated amounts. The Company does not allocate all of its assets, or its depreciation and depletion expense, selling, general and administrative expenses, transactions costs, interest expense, and income tax expense by segment. The following tables include reconciliations of segment information to consolidated amounts (in thousands): For the three months ended 2021 2020 Revenues Mining $ 206,989 $ 221,338 All other 6,775 5,382 Total revenues $ 213,764 $ 226,720 For the three months ended 2021 2020 Capital Expenditures Mining $ 8,619 $ 21,837 All other 860 938 Total capital expenditures $ 9,479 $ 22,775 The Company evaluates the performance of its segment based on Segment Adjusted EBITDA, which is defined as net (loss) income adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative, net interest expense, income tax expense, loss on early extinguishment of debt, other income and certain transactions or adjustments that the CODM does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA does not represent and should not be considered as an alternative to cost of sales under GAAP and may not be comparable to other similarly titled measures used by other companies. Below is a reconciliation of Segment Adjusted EBITDA to net (loss) income, which is its most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands): For the three months ended 2021 2020 Segment Adjusted EBITDA $ 52,639 $ 69,824 Other revenues 6,775 5,382 Cost of other revenues (7,795) (7,561) Depreciation and depletion (32,903) (28,692) Selling, general and administrative (7,637) (8,456) Other income (expense) (109) 1,822 Interest expense, net (8,693) (7,533) Income tax expense (23,632) (3,241) Net (loss) income $ (21,355) $ 21,545 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Regular Quarterly Dividend On April 27, 2021, the Board declared a regular quarterly cash dividend of $0.05 per share, totaling approximately $2.6 million, which will be paid on May 12, 2021 to stockholders of record as of the close of business on May 7, 2021. Collective Bargaining Agreement |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of PresentationThe accompanying financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion, the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. |
Impact of the COVID-19 Pandemic Upon our Financial Condition and Results of Operations | Impact of the COVID-19 Pandemic Upon our Financial Condition and Results of Operations The global steelmaking industry's demand for met coal is affected by pandemics, epidemics or other public health emergencies, such as the recent outbreak of the novel coronavirus disease 2019 ("COVID-19"), which has spread from China to many other countries including the United States. In March 2020, the World Health Organization ("WHO") declared COVID-19 as a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. The outbreak has resulted in governments around the world implementing increasingly stringent measures to help control the spread of the virus, including quarantines, "shelter in place" and "stay at home" orders, travel restrictions, business curtailments, school closures, and other measures. In addition, governments and central banks in several parts of the world have enacted fiscal and monetary stimulus measures to counteract the impacts of COVID-19. The Company operates in a critical infrastructure industry, as defined by the U.S. Department of Homeland Security. As such, the Company continues to operate its mines in a safe manner under the guidelines issued by the Centers for Disease Control and Prevention and the Alabama State Health Department. In response to these measures and for the protection of employees, the Company has taken steps to ensure our employees remain safe. As of the filing of this Form 10-Q, the Company has not had to idle or temporarily idle its mines as a result of COVID-19. COVID-19 has had and may continue to have further negative impacts on our two operating mines, supply chain, transportation networks and customers, which may continue to compress our margins, and reduce demand for the met coal that we produce. The COVID-19 outbreak is a widespread public health crisis that is adversely affecting the economies and financial markets of many countries, including those of our customers, which are primarily located in Europe, South America and Asia. A prolonged economic downturn could adversely affect demand for our met coal and contribute to volatile supply and demand conditions affecting prices and volumes. The progression of COVID-19 could also negatively impact our business or results of operations through the temporary closure of one of our mines, customers or critical suppliers, or the McDuffie Coal Terminal at the Port of Mobile, Alabama, or a disruption to our rail and barge carriers, which would delay or prevent deliveries to our customers, among others. In addition, the ability of our employees and our suppliers' and customers' employees to work may be significantly impacted by individuals contracting or being exposed to COVID-19, or as a result of the control measures noted above, which may significantly affect the demand for met coal. Our customers may be directly impacted by business curtailments or weak market conditions and may not be willing or able to fulfill their contractual obligations or open letters of credit. We may also experience delays in obtaining letters of credit or processing letter of credit payments due to the impacts of COVID-19 on foreign issuing and U.S. intermediary banks. Furthermore, the progression of, and global response to, the COVID-19 outbreak has begun to cause, and increases the risk of, further delays in construction activities and equipment deliveries related to our |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include short-term deposits and highly liquid investments that have original maturities of three months or less when purchased and are stated at cost, which approximates fair value. |
Short-Term Investments | Short-Term Investments Instruments with maturities greater than three months, but less than twelve months, are included in short-term investments. The Company purchases United States Treasury bills with maturities ranging from six to twelve months which are classified as held to maturity and are carried at amortized cost, which approximates fair value. The Company also purchases fixed income securities and certificates of deposits with varying maturities that are classified as available for sale and are carried at fair value. Securities classified as held to maturity are those securities that management has the intent and ability to hold to maturity. |
Revenue Recognition | Revenue Recognition Revenue is recognized when performance obligations under the terms of a contract with the Company's customers are satisfied; for all contracts this occurs when control of the promised goods have been transferred to its customers. For coal shipments to domestic customers via rail, control is transferred when the railcar is loaded. For coal shipments to international customers via ocean vessel, control is transferred when the vessel is loaded at the Port of Mobile, Alabama. For natural gas sales, control is transferred when the gas has been transferred to the pipeline. Revenue is disaggregated between coal sales within the Company's mining segment and natural gas sales which is included in all other revenues, as disclosed in Note 13. |
Trade Accounts Receivable and Allowance for Credit Losses | Trade Accounts Receivable and Allowance for Credit Losses Trade accounts receivable represent customer obligations that are derived from revenue recognized from contracts with customers. Credit is extended based on an evaluation of the individual customer's financial condition. The Company maintains trade credit insurance on the majority of its customers and the geographic regions of coal shipments to these customers. In some instances, the Company requires letters of credit, cash collateral or prepayments from its customers on or before shipment to mitigate the risk of loss. These efforts have consistently resulted in the Company recognizing no historical credit losses. The Company also has never had to have a claim against its trade credit insurance policy. In order to estimate the allowance for credit losses on trade accounts receivable, the Company utilizes an aging approach in which potential impairment is calculated based on how long a receivable has been outstanding (e.g., current, 1-31, |
New Accounting Pronouncements | New Accounting Pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued ASU 2019-12, “Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes,” which is intended to simplify various aspects related to accounting for income taxes. This ASU removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. The ASU is effective for fiscal years beginning after December 15, 2020. The Company adopted the standard as of January 1, 2021 with no material impact to the Company's results of operations, financial condition, cash flows or financial statement presentation. |
Inventories, net (Tables)
Inventories, net (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, Net | Inventories, net are summarized as follows (in thousands): March 31, 2021 December 31, 2020 Coal $ 102,058 $ 86,272 Raw materials, parts, supplies and other, net 33,638 32,441 Total inventories, net $ 135,696 $ 118,713 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Summary of Valuation Allowance | The following table shows the balance of our state deferred income tax asset valuation allowance and the associated activity during the three months ended March 31, 2021: March 31, 2021 Beginning balance $ — Addition - current tax expense 47,787 Ending balance $ 47,787 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Debt consisted of the following (in thousands): March 31, December 31, 2020 Weighted Average Interest Rate at March 31, 2021 Final Maturity Senior Secured Notes $ 343,435 $ 343,435 8% 2024 ABL Borrowings 40,000 40,000 4% 2023 Debt discount/premium, net (3,337) (3,527) Total debt 380,098 379,908 Less: current debt — — Total long-term debt $ 380,098 $ 379,908 |
Other Long-Term Liabilities (Ta
Other Long-Term Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | Other long-term liabilities are summarized as follows (in thousands): March 31, 2021 December 31, 2020 Black lung obligations $ 34,518 $ 34,567 Other 2,701 2,258 Total other long-term liabilities $ 37,219 $ 36,825 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases was as follows (in thousands): March 31, 2021 December 31, 2020 Finance lease right-of-use assets, net (1) $ 77,921 $ 46,746 Finance lease liabilities Current 23,619 14,385 Noncurrent 40,662 24,091 Total finance lease liabilities $ 64,281 $ 38,476 Weighted average remaining lease term - finance leases (in months) 40.4 42.9 Weighted average discount rate - finance leases (2) 6.28 % 5.77 % (1) Finance lease right-of-use assets are recorded net of accumulated amortization of $12.1 million and $9.8 million and are included in property, plant and equipment, net in the Condensed Balance Sheet as of March 31, 2021 and the Balance Sheet as of December 31, 2020, respectively. |
Components of Lease Expense, Finance Leases | The components of lease expense were as follows (in thousands): For the three months ended 2021 2020 Operating lease cost (1): $ 1,189 $ 292 Finance lease cost: Amortization of leased assets 4,125 2,998 Interest on lease liabilities 774 546 Net lease cost $ 6,088 $ 3,836 (1) Includes leases that are for periods of 12 months or less. |
Components of Lease Expense, Operating Leases | The components of lease expense were as follows (in thousands): For the three months ended 2021 2020 Operating lease cost (1): $ 1,189 $ 292 Finance lease cost: Amortization of leased assets 4,125 2,998 Interest on lease liabilities 774 546 Net lease cost $ 6,088 $ 3,836 (1) Includes leases that are for periods of 12 months or less. |
Maturities of Lease Liabilities | Maturities of lease liabilities were as follows (in thousands): Finance Leases (1) 2021 $ 21,167 2022 24,761 2023 22,125 2024 2,557 2025 732 Thereafter — Total 71,342 Less: amount representing interest (7,061) Present value of lease liabilities $ 64,281 (1) Finance lease payments include $1.4 million of future payments required under signed lease agreements that have not yet commenced. |
Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows (in thousands): For the three months ended 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 774 $ 546 Financing cash flows from finance leases $ 8,247 $ 3,833 Non-cash right-of-use assets obtained in exchange for lease obligations: Finance leases $ 35,288 $ 2,286 |
Net (Loss) Income per Share (Ta
Net (Loss) Income per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Income per Share | Basic and diluted net (loss) income per share was calculated as follows (in thousands, except per share data): For the three months ended 2021 2020 Numerator: Net (loss) income $ (21,355) $ 21,545 Denominator: Weighted-average shares used to compute net (loss) income per share—basic 51,274 51,106 Dilutive restrictive stock awards (1) — 167 Weighted-average shares used to compute net (loss) income per share—diluted 51,274 51,273 Net (loss) income per share—basic $ (0.42) $ 0.42 Net (loss) income per share—diluted $ (0.42) $ 0.42 (1) In periods of net loss, the number of shares used to calculate diluted earnings per share is the same as basic earnings per share; therefore, the effect of dilutive securities is zero for such periods. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segments to Consolidated | The following tables include reconciliations of segment information to consolidated amounts (in thousands): For the three months ended 2021 2020 Revenues Mining $ 206,989 $ 221,338 All other 6,775 5,382 Total revenues $ 213,764 $ 226,720 |
Reconciliation of Capital Expenditures from Segments to Consolidated | For the three months ended 2021 2020 Capital Expenditures Mining $ 8,619 $ 21,837 All other 860 938 Total capital expenditures $ 9,479 $ 22,775 |
Reconciliation of Net Income (Loss) from Segments to Consolidated | Below is a reconciliation of Segment Adjusted EBITDA to net (loss) income, which is its most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands): For the three months ended 2021 2020 Segment Adjusted EBITDA $ 52,639 $ 69,824 Other revenues 6,775 5,382 Cost of other revenues (7,795) (7,561) Depreciation and depletion (32,903) (28,692) Selling, general and administrative (7,637) (8,456) Other income (expense) (109) 1,822 Interest expense, net (8,693) (7,533) Income tax expense (23,632) (3,241) Net (loss) income $ (21,355) $ 21,545 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Short-Term Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Schedule of Held-to-maturity Securities [Line Items] | ||
Short-term investments | $ 8,504 | $ 8,504 |
Cash and Fixed Income Securities | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Short-term investments | $ 8,500 | $ 8,500 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Revenue Recognition (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021USD ($)t | Mar. 31, 2020USD ($) | |
Concentration Risk [Line Items] | ||
Percent of total production transferred for title and marketing | 10.00% | |
Maximum total production transferred for title and marketing (in tons) | t | 250,000 | |
Other revenues | $ 213,764 | $ 226,720 |
XCoal | Customer Concentration Risk | Revenue | ||
Concentration Risk [Line Items] | ||
Other revenues | $ 106,200 | $ 44,300 |
Concentration risk, percentage | 50.90% | 19.90% |
Inventories, net (Details)
Inventories, net (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Coal | $ 102,058 | $ 86,272 |
Raw materials, parts, supplies and other, net | 33,638 | 32,441 |
Total inventories, net | $ 135,696 | $ 118,713 |
Income Taxes- Narrative (Detail
Income Taxes- Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Tax Credit Carryforward [Line Items] | |||
Income tax expense | $ 23,632 | $ 3,241 | |
Deferred income tax valuation allowance | 47,787 | $ 0 | |
Income tax benefit from remeasurement of deferred income tax assets and liabilities | 22,900 | ||
Income tax benefit from Internal Revenue Code | 1,300 | ||
State and Local Jurisdiction | |||
Tax Credit Carryforward [Line Items] | |||
Deferred income tax valuation allowance | $ 47,800 |
Income Taxes - Valuation Allowa
Income Taxes - Valuation Allowance Schedule (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Deferred Tax Asset Valuation Roll Forward | |
Addition - current tax expense | $ 47,787 |
Debt - Schedule of Long-Term De
Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Debt discount/premium, net | $ (3,337) | $ (3,527) |
Total debt | 380,098 | 379,908 |
Less: current debt | 0 | 0 |
Total long-term debt | 380,098 | 379,908 |
ABL Borrowings | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 40,000 | 40,000 |
Weighted average interest rate | 4.00% | |
Senior Secured Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 343,435 | $ 343,435 |
Weighted average interest rate | 8.00% |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) | Mar. 24, 2020 | Jun. 30, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Mar. 01, 2018 | Nov. 02, 2017 |
Debt Instrument [Line Items] | |||||||
Borrowings under ABL Facility | $ 0 | $ 70,000,000 | |||||
Outstanding debt | 380,098,000 | $ 379,908,000 | |||||
Cash and cash equivalents | 221,947,000 | $ 211,916,000 | |||||
Senior Secured Notes | Senior Secured Notes Due 2024, Existing Notes | |||||||
Debt Instrument [Line Items] | |||||||
Face amount of debt | $ 350,000,000 | ||||||
Stated interest rate | 8.00% | ||||||
Senior Secured Notes | Senior Secured Notes Due 2024, New Notes | |||||||
Debt Instrument [Line Items] | |||||||
Face amount of debt | $ 125,000,000 | ||||||
Senior Secured Notes | Senior Secured Notes Due 2024, Existing Notes, Restricted Payment Offer | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 8.00% | ||||||
ABL Borrowings | ABL Facility | |||||||
Debt Instrument [Line Items] | |||||||
Amount of borrowings available | 50,100,000 | ||||||
Citibank | ABL Borrowings | |||||||
Debt Instrument [Line Items] | |||||||
Borrowings under ABL Facility | $ 70,000,000 | ||||||
Repayment of debt | $ 30,000,000 | ||||||
Outstanding debt | $ 40,000,000 |
Other Long-Term Liabilities (De
Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | ||
Black lung obligations | $ 34,518 | $ 34,567 |
Other | 2,701 | 2,258 |
Total other long-term liabilities | $ 37,219 | $ 36,825 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | Mar. 31, 2021USD ($) |
Lessor, Lease, Description [Line Items] | |
Finance leases that have not yet commenced | $ 1.4 |
Minimum | |
Lessor, Lease, Description [Line Items] | |
Remaining lease terms | 1 year |
Finance leases not yet commenced, term | 1 year |
Maximum | |
Lessor, Lease, Description [Line Items] | |
Remaining lease terms | 5 years |
Finance leases not yet commenced, term | 2 years |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Finance lease right-of-use assets, net | $ 77,921 | $ 46,746 |
Finance lease liabilities | ||
Current | 23,619 | 14,385 |
Noncurrent | 40,662 | 24,091 |
Total finance lease liabilities | $ 64,281 | $ 38,476 |
Weighted average remaining lease term - finance leases (in months) | 3 years 5 months 26 days | 3 years 6 months 25 days |
Weighted average discount rate - finance leases | 6.28% | 5.77% |
Accumulated amortization | $ 12,100 | $ 9,800 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, plant and equipment, net | Property, plant and equipment, net |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating lease cost | $ 1,189 | $ 292 |
Finance lease cost: | ||
Amortization of leased assets | 4,125 | 2,998 |
Interest on lease liabilities | 774 | 546 |
Net lease cost | $ 6,088 | $ 3,836 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Leases [Abstract] | |
2021 | $ 21,167 |
2022 | 24,761 |
2023 | 22,125 |
2024 | 2,557 |
2025 | 732 |
Thereafter | 0 |
Total | 71,342 |
Less: amount representing interest | (7,061) |
Present value of lease liabilities | 64,281 |
Future payments required under signed lease agreements that have not yet commenced | $ 1,400 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from finance leases | $ 774 | $ 546 |
Financing cash flows from finance leases | 8,247 | 3,833 |
Non-cash right-of-use assets obtained in exchange for lease obligations: | ||
Finance leases | $ 35,288 | $ 2,286 |
Net (Loss) Income per Share - S
Net (Loss) Income per Share - Schedule of Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Numerator: | ||
Net (loss) income | $ (21,355) | $ 21,545 |
Denominator: | ||
Weighted-average shares used to compute net (loss) income per share-basic (in shares) | 51,274 | 51,106 |
Dilutive restrictive stock awards (in shares) | 0 | 167 |
Weighted-average shares used to compute net (loss) income per share-basic (in shares) | 51,274 | 51,273 |
Net (loss) income per share-basic (in dollars per share) | $ (0.42) | $ 0.42 |
Net (loss) income per share-diluted (in dollars per share) | $ (0.42) | $ 0.42 |
Net (Loss) Income per Share - N
Net (Loss) Income per Share - Narrative (Details) - shares | Feb. 16, 2021 | Mar. 31, 2021 |
Restricted Stock Units (RSUs) | 2017 Equity Plan | ||
Class of Stock [Line Items] | ||
Shares awarded (in shares) | 398,945 | |
Shares to be issued upon settlement of awards (in shares) | 87,566 | |
Common stock shares contingently issuable (in shares) | 13,157 | |
Service-based RSUs | 2017 Equity Plan | ||
Class of Stock [Line Items] | ||
Vesting period | 3 years | |
RSUs excluded from computation of earnings per share (in shares) | 319,863 | |
Service-based RSUs | 2016 Equity Plan | ||
Class of Stock [Line Items] | ||
RSUs excluded from computation of earnings per share (in shares) | 27,431 | |
Performance and market-based RSUs | 2017 Equity Plan | ||
Class of Stock [Line Items] | ||
Vesting period | 3 years | |
RSUs excluded from computation of earnings per share (in shares) | 523,479 | |
Phantom Share Units (PSUs) | 2016 Equity Plan | ||
Class of Stock [Line Items] | ||
Common stock shares contingently issuable (in shares) | 43,580 | |
Phantom Share Units (PSUs) | 2016 and 2017 Equity Plans | ||
Class of Stock [Line Items] | ||
Settlement period | 5 years |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Black Warrior Methane (BWM) | ||
Related Party Transaction [Line Items] | ||
Proportionate consolidation method, ownership percentage | 50.00% | |
Black Warrior Transmission (BWT) | ||
Related Party Transaction [Line Items] | ||
Equity method investment, ownership percentage | 50.00% | |
Allocated Expenses to Joint Venture | Corporate Joint Venture | ||
Related Party Transaction [Line Items] | ||
Expenses from transactions with related party | $ 0.8 | $ 0.5 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Settlement proceeds | $ 1,800,000 | |||
Throughput obligation | $ 0 | $ 0 | ||
Coal royalty expense | $ 12,700,000 | $ 14,200,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | Feb. 18, 2021 | Mar. 31, 2021 | Mar. 26, 2019 | May 02, 2018 |
Class of Stock [Line Items] | ||||
Dividends declared (in dollars per share) | $ 0.05 | |||
Regular quarterly cash dividend | $ 2,600,000 | |||
New Stock Repurchase Program | ||||
Class of Stock [Line Items] | ||||
Authorized amount of stock to be repurchased, value | $ 70,000,000 | |||
Shares repurchased (in shares) | 500,000 | |||
Treasury stock purchase, value | $ 10,600,000 | |||
Remaining authorized repurchase amount | $ 58,800,000 | |||
The First Stock Repurchase Program | ||||
Class of Stock [Line Items] | ||||
Authorized amount of stock to be repurchased, value | $ 40,000,000 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Letters of credit outstanding | $ 9.4 | |
ABL Facility | ABL Borrowings | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amount of borrowings available | 50.1 | |
Senior Secured Notes Due 2024, Existing Notes | Senior Secured Notes | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of debt instrument | 355 | $ 352.5 |
ABL Borrowings | Citibank | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt under ABL Facility | $ 40 | 40 |
ABL Borrowings | Citibank | Letter of Credit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Letters of credit issued and outstanding | $ 9.4 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Number of reportable segments | 1 |
Segment Information - Reconcili
Segment Information - Reconciliation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
Total revenues | $ 213,764 | $ 226,720 |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 6,775 | 5,382 |
Mining | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total revenues | $ 206,989 | $ 221,338 |
Segment Information - Reconci_2
Segment Information - Reconciliation of Capital Expenditures (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
Capital Expenditures | $ 9,479 | $ 22,775 |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Capital Expenditures | 860 | 938 |
Mining | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Capital Expenditures | $ 8,619 | $ 21,837 |
Segment Information - Reconci_3
Segment Information - Reconciliation of Net Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenue from External Customer [Line Items] | ||
Segment Adjusted EBITDA | $ 52,639 | $ 69,824 |
Other revenues | 213,764 | 226,720 |
Cost of other revenues | (7,795) | (7,561) |
Depreciation and depletion | (32,903) | (28,692) |
Selling, general and administrative | (7,637) | (8,456) |
Other income (expense) | (109) | 1,822 |
Interest expense, net | (8,693) | (7,533) |
Income tax expense | (23,632) | (3,241) |
Net (loss) income | (21,355) | 21,545 |
Other revenues | ||
Revenue from External Customer [Line Items] | ||
Other revenues | $ 6,775 | $ 5,382 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Millions | Apr. 27, 2021 | Feb. 18, 2021 |
Subsequent Event [Line Items] | ||
Dividends declared (in dollars per share) | $ 0.05 | |
Regular quarterly cash dividend | $ 2.6 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Dividends declared (in dollars per share) | $ 0.05 | |
Regular quarterly cash dividend | $ 2.6 |