BTU - Earnings call transcript Q2 2022 | Peabody Energy Corporation

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Operator

Welcome to the Peabody Second Quarter Earnings Call. [Operator Instructions]. And at this time, I would now like to turn the conference over to Alice Tharenos, Vice President of Investor Relations. Please go ahead.

Alice Tharenos

Good morning, and thank you for joining Peabody's earnings call for the second quarter of 2022. President Jim are Mark and today Spurbeck. me and Grech; CEO, CFO, With

release, statement SEC. measures. find as the public to factors you'll Within earnings Jim. with along our turn to the a our the of referenced over there, you with well reconciliation on now non-GAAP encourage financial the We filings consider risk I'll as information forward-looking call

James Grech

of our over good than morning, weather million highest free everyone. diversified quarter, assets and second generating our delivered logistical Alice, and EBITDA Thanks, cash a adjusted the flow $XXX and million, ongoing of results, strong In challenges. decade $XXX despite more in

our expect high volumes strong first the the segments continue half with although all of a volatile supporting and compared to prices. markets, continued to higher projected half We in second year

our sales cash all quarter, capturing PRB, higher market in except the delivered senior During we greater with to our we which allow financial voluntary generated, secured in bringing continue us sheet margins. every the segment us resulted flexibility eliminating will repurchases, the volumes strengthen closer future. debt reduction prices, balance in With by strategy which debt, advancing strong increased to

of for to and challenges today. the we sincerely on focus we adverse I talented are logistics quarter and the results been been we the would our weather outstanding which Before workforce, have global had reporting truly employees have expand Without has quarter, safely I their efficiently, thank on would like dedication the second continued our working not remarkable facing. given

to currently market segments the segments. operating are the is reallocating Seaborne our disruption at a Russia-Ukraine elevated most in conflict. availability that continue with all globe, resulting our serving coal the all of to markets across coal. facing ability demand from remain of to market levels, constrained scarce that favorable base indices the global be for supply dynamic turning Now markets; outlook price the coal representing The test a continues of coal

Our prices a Australian countries incentivizing record historical supply terminal coal in by The reliability. Australia recent volumes export rainfall gas pipeline supply. reduced thermal to LNG gas high markets. be coal this is Australia performance the an supply. markets Furthermore, Overall, Europe. ration generation. the to generation. the the further prices maximize into Compounding continues rail to where further these strong is And at source natural continues with Russian by in provides as U.S. primarily weather Europe near-term The issues. Eastern as is supply and coal coal levels High levels markets global of heavy to robust, restart record preparation levels Actions the U.S. available that range challenged coal with Russia energy coal EU challenged of agreement for in the result remain most generation coal most COVID to further historically globe, the of be value. it July including support limiting is U.S., to locations, gas from logistics also is a of fuel are coal generators near upon conflict called rail impacts. by Evidence thermal absenteeism Seaborne creating alternative be need continue closed the pricing energy European outage and remain high impacting U.S. for with are issues, interruptions use winter, fuel constraining reduction European supply XX% recent imports around supply continued incentives challenged and in exports international security to of associated cessation by and coal for providing is challenging staff generation the gas to fuel in economic in including Russia-Ukraine of from and

Within as of inflationary the has September are falling and falling economic result been seaborne face confidence in trimmed demand user steel anticipated pressures of of steel in North weakening Europe metallurgical end to Asia There to distributor globally. the a signs inventories. due July for prices output market, and high increasing

As steelmakers cuts, introduce incremental of have production demand. seen a output weakening metallurgical we coal

Robust forward Moving the coal balance coal U.S. for prices switching coal from technical switching buyers some can and prices to coming steelmakers as as dynamic who Australia, regions coal PCI a seeking of from this Atlantic and be which supply And viewed our is met particularly opportunities impact, the the for overcome away market other in for Russian can creating are barriers. met and above positive European such offset this market, months. thermal coals. in Canada, imports

announcements constrained. increased demand economic are electricity to delayed utility While we PRB weather fluctuates concerns at and most the the renewable prices continued has United States, market plant declined in grid across growing not energy of as energy Year-to-date, to This impacted coal terminal year-over-year are value remain gas the higher coal production seen remain tightness, by this coal continued strong with linger of result conservation the some market delayed as to generation demand remains in increased since of demand citing Transportation constrained with and retirements utilities and activity, demand. stocks more in of increased performance. U.S., the rail reliability present U.S. anticipate natural and a activity. year-over-year, by X% occurring near-term thermal underlying lift be with electricity or to to market from globe. Evidence supply concerns summer In caution domestic of for coal meet positively Overall, XXXX being the levels keeping due supply supply the coals. markets more LNG capacity. Across elevated even given as regarding demand dispatchable concerns electricity transition, a an to Overall, as this speaks a gas weather the market. has and outage build U.S. we pace constructive than issues with is coal shortages seeing coal and projects. industrial volatility inflationary supply near-term markets the for remains remains driving metallurgical fundamentals static. coal coal tight continue coal the

diversified optimizing these the Our results by each is of diversified in positioned markets, of managing base. platform to our needs participate customer

Now volumes turning to production second despite results were the strong our factors operations quarter several our deliver platform. plans second to are quarter; at our delaying increased external across that

with of segment, and quarter. other these We In staffing have production rain our indicates COVID-related heavy in to the updated half included our results volumes projection, quarter recovery impact continue impact guidance, of hinder lower shortages full our and adjustments in third second factors for improvements fourth La operations the Thermal the further to recapture Seaborne plans In which the early than inches down with expectations the and deliver Nina with of record services, quarter flooding Wambo. We interruptions X as at to to event second intensified rail recover productivity rain, our in sales more line in inventory resulted Wilpinjong and reducing event Wambo drew challenges. July, guidance. mines This flooding. production from year

the other additional update mines lower from and the to sales second volumes, royalties had we've guidance events. to quarter recover third as in these half costs reflect However,

In of the second the and longwall Moorvale challenges Shoal panel is operating as Production was million completed in and X impacted delivering positioned the COVID rate, quarter, also impacted denominated of the in second overburden higher year rail volumes million performance Creek, This nearly expected deliver to half. tons to unfavorably less which the on shipped had At PRB, future. segment the move of At degradation on to to CMJV resulted the and following segments, second the the delivered at our The to further half. during which quarter. volumes impact the the quarter as market by is metallurgical will we tons for a absenteeism here quarter. volumes X second panel, rains progresses. operations longwall has South. shipments costs remove the track guidance and by Metropolitan, attributable Our strong those project quarter XX% in we in our its higher production in share dynamics, Seaborne JX customers mine deliver higher transitioned Outside we tons and volumes are third also the from benefit in JX Met XXX,XXX higher and first ownership severe from our in production benefited higher we less Middlemount in deliver first continue production.

be have we rail XX million although tons XXXX, on For customer volumes sales performance. commitments, under dependent will

expected deliver results with new remain strong continue U.S. increasing for volumes both customers. the Demand continued with thermal products Our our second thermal business new to place U.S. we strong, half. in and and to existing other mines

long-term a of customers In X remaining million tons BTU for we tons ESG to the our champion position while have of that $XX.XX delivery. report, continue our XXXX priced as at also This strong We of approximately our to enhance and a reposition producer be quarter, providing to capturing sales stakeholders. ourselves strategies for we to and X,XXX security thermal to developing average targets of the coal to the long-term commitment choice, million X U.S. targets XX.X have our Peabody out of which explore segment commitments and programs million X,XXX strengthen setting has $XX.XX ESG prices. the to our position better an ton, and support PRB, includes BTU XXXX, a practices. higher-quality taken our priced ton we the issued uncommitted steps the at to ESG other supply, In a lays volumes with our

solar storage in on Indiana. efforts continue scale of to and RX to mining of development we Renewables coal battery advance six and Illinois pursue Finally, utility tracks the land previous

and Treaty finalized Oak. commenced developer, have We management project with team evaluations site our our

want the producer to of to simple. for choice. coal our Our future vision a We strengthen as is position continue

us needs, excellence champion financial be in do to all a and strength, delivering this will operational cycles grow will products by We our stakeholders. practices. This customers' diversity resilient practicing ESG maintaining to reliably with our to allow support of and

give met and to of completing Thermal at with flexibility addition demand. we customer development mine continue XX initiatives. South In U.S., to the We are North CMJV, to we life of this development. Goonyella. our a plans reserves plans incremental platform, in million southern to extending tons further strategies of extend volumes and underground at in Wambo quality life our to progressing to our continued assess longwall sales of implement Seaborne and changing meet Moorvale multiple the we through in strategic platform, development to vision are capture In And the improve

the cover we these sheet of of with turn at And activities the most Mark Francisco on further Gateway. new at now and additional details. examples strength and focused Some balance are in things importantly, the our complex Midwest I'll areas to debt Wild to financial the Boar over into remain mining expansion units financial repayments.

Mark Spurbeck

morning, Thanks, cash results. of first company. good nearly for with million, Jim, shareholders Xx we and the adjusted million, prior the income or year of $XXX recorded quarter more as everyone. the per We attributable diluted to common share $X.XX than net of $XXX the ending quarter, a EBITDA second In flow debt time cash million free generated and public $XXX

costs XX% with costs transition inflationary the doing overburden premium Australian than Second continue the our $X.X Shoal result billion, JX hard sales panel, quarter sensitive costs achieving These prices than double products in were together revenue terrific year recently year. substantially coal. and from an to thermal and other coking the prior to coal as higher longwall well, prior removal diversified prices fuel increase realize Creek the particularly with and price prices was more higher premium PRB the higher pressures, in higher

was due tons, quarter prices the X.X hedged and higher sales Turning additional Thermal now the EBITDA, than in results; per to than ton $XXX nearly quarter prices XX% were of million to margins. index-linked segment and first Seaborne double The export first quarter. exported price realized segment $XX export realized partially resulting offset sales, results as quarter by The first million tons. the higher $XXX generated price average second EBITDA fixed higher $XXX,XXX

shipped contractor as result lower higher to costs. our in the higher the XX. in higher additional million stronger prices, for PRB than sales production the nominations only at quarter. first up realized tons, about tons, In costs overburden to were XX% costs absence higher removal met export transition of overburden EBITDA, higher June Creek in costs available offset of including thermal lower-than-expected X.X CMJV we impacted $XXX million of the international well compared segment Thermal offset a The $XXX and increased segment the of million Seaborne million has EBITDA. quarter rail to sold realized export due mines $XXX first cash mix customers million Met as prior more of Shoal The other higher fuel an of $XX of of adjusted half costs, this some prices. generated $XXX resulting XX% commodity The Creek. Cost more benefit to $XXX, over partially service and will less additional million than quarter tons, favorably price hamper the year. quarter Costs by XX% as from fuel higher from is Shoal of price half cost Wilpinjong average XX.X first sales removal sensitive the $XXX ton, in the increased shipped about of by prices Second EBITDA segment as to continued per a as prices Wilpinjong to and customer the had quarter U.S., uncovered million per recorded EBITDA per Wilpinjong shipped of coal first XX% X in Mine, tons. shipments ton relative driven ton to as X.X the million which at and that Included prices. tons. of The to sales quarter costs price-sensitive and fuel average the shift quarter prior compared margins. quarter the to volume higher million tons as with than of tons second start $XX than million Seaborne attributable delivered the than the and rail X.X customers

by segment other thermal other the and XX%. margins costs, shipped mines higher to Midwest mines million reported as due of fuel The the U.S. costs. X.X quarter higher the EBITDA tons offset first commodity increased Costs XXX,XXX quarter, sales tons compared partially increased and first onetime to

XX, at a had total quick Now more June of billion financing cash million items; than we cash debt. $XX look and at $X.X equivalents,

less of another retired of Wilpinjong secured reciprocal close upon we $XX Subsequent expect the million, a original the senior debt. million additional quarter, second month. senior holders debt pursuant a in million. a million repayments bringing $XXX an to to notes offer term offer, Wilpinjong we Immediately the to an was from $XXX the During XX, year-to-date million, additional loan for closing to notes offer June $XX $XX an we that $XX million offer, retired Wilpinjong we launched little than which to upsized including

Now, turn full year to let's our outlook.

higher second we on As mine weather Jim impacts mentioned, have for prices. updated segment, costs plans, and half guidance to Australian Thermal sales the ton account from Seaborne X production. tons. and for fuel higher We million expectations fuel we expected to account price In commodity lowered sensitive sales higher the our increased to reflect lost year by productivity by X.X lower to rains, and full $X per severe price-sensitive cost prices costs, million other

achieve on which about benchmark X.X export price a coal the ton average to unpriced premium have XXX,XXX including highly current levels on year priced tons tons, in hard benchmark. result are metallurgical tons, increasingly million We we sales lowered strong to poor July South costs mines. XX% full royalty X and nominations been performance, effect to are line sales and higher year expected result have higher from by $XXX primarily shipped regime, is on and Essentially, Newcastle increased increased volumes as lower half be second U.S. tons of at expected Queensland end market quarter, higher recently dependent million costs the volume have raised than tons. in the million and guidance, half in and customer committed, full bit is progressive volume costs We to other higher at be the all expect and based to a X $X XX%. anticipated we of X inflationary pressures. the for lower as $XX on experienced Metropolitan, tons thermal second million second remaining segment price second expected Cost $X.XX to maintenance to announced conditions. rail first costs X.X to Higher thermal results reflect tons, expected X to With for X.X by of and API current with achieve a but current year due coal Based the are higher the by million took coal month-to-date fuel essentially quarter PRB, is tons tons we've the previous the volumes general XX% while rail tons. Seaborne volume, fuel, and the and mix XX.X tons In to the unpriced, prices. narrowed continue and volumes. which range PRB to Other production to XXX,XXX priced increasing of at down all expected the Moorvale Creek the fuel were U.S. XX.X raised rail availability. to XXX,XXX due half per XX% XX% Shoal million only was about million or service. product coking full July quality higher

we these strong flows. expect cash with and second a updates, half margins With

call to approach and Lastly, repaying obligations. I'd cash maintain cash secured collateralized Operator? flow to using allocation our debt reclamation to over we like now will for continue turn capital the questions. free disciplined

Operator

Securities. Instructions]. Lucas [Operator from Pipes, take we'll question B. And our Riley first

Lucas Pipes

into month I prior the about new think around this. wanted questions I was royalty Goonyella, or capital and to Queensland. of ask a announced for bit factored sounds returns, regime back a ago so North and if here like North kind quarters Goonyella first to specifically, it there it And

maybe royalty be speedier further were? already greater this the list moving project and are they the changes more down priority attractive with and may capital So than returns is even side, organic on the

James Grech

Yes.

Goonyella, royalty North about of you in talked Queensland. just And the on couple comments a that. So regime quick new

affected Lucas it online. not the it's of course, in affects Queensland, our -- First, is CMJV that Mine is North not when because Metropolitan and Goonyella Middlemount back brought by and

option growth been still and and that North the engineering opportunity organic project, still company. year. we is surface have that which probably studies organic attractive growth, work a lot with a of the in we for throughout So we're our best on doing doing Goonyella evaluation have the And

as that a still it's list us of our priority So projects of at for very the financially high in looking attractive. we're all being

Lucas Pipes

switch I'll for now. topics

pricing. XXXX of movement price is and you far pricing how the domestic, is Lots give on this but products priced the What's that left really increase much just various what committed update us power, given an and not -- XXXX? to obviously can quarters are away commitments. an coming properly understatement. pointed your you calibrate earnings kind for sell, not and anymore, very allow next here, us into of So where significant we to and to -- internationally year, obviously, also but the But would XXXX have your

James Grech

as far a in sold have got all in still of the other and million we've $XX.XX comments, as have thermal got the PRB, $XX.XX XX.X tons X,XXX we've my in at Btu. on sold the quality that's at our tons sold coal in the ton. We Lucas, unsold is the we X,XXX million And in as PRB XXXX said Yes. U.S., I've coal. XX

year. as for so our we guidance tonnages And next given to haven't yet

metallurgical sold to we prepared have from far this we that's year year. time, now what that as for for interest but in quantities that in them coal customers at to year, have next will markets commitments not getting to metallurgical than I we this our we're are greater sell sold as interest the say next there. So do

interesting about markets, prices So now this in it since them metallurgical of but will is for increased that interest tonnage getting those amount doing sold we probably you're year. an dynamic customer come asking XXXX make we're the those significantly to what to sales, of index in course, commitments at

Lucas Pipes

XXXX factor it question you selling And robust, that what into extremely coal over. met Are The thermal also international coal Seaborne mentioned on ask met Thermal markets, coal. would one coal just you commitments? market And into I'll turning rare final over premium that before already?

James Grech

talk being metallurgical into market? you selling Lucas, markets, those when about the talking about you are sold into coal

Lucas Pipes

Correct, correct, correct. Yes.

James Grech

I Okay. understand your question.

Lucas Pipes

yes, the met coal No, thermal market. switching volumes into it's seaborne coal about Yes.

James Grech

for sales third interest year. started locking mine next occurring looking metallurgical strictly year as at referred We've those buyers next I for to Yes. What Creek so our having was into some and that and Shoal coal be for mainly this quarter to metallurgical the year. tons far from coal of as down

Operator

Company. move we'll to Benchmark on Martin, Next, Nathan

Nathan Martin

I guess was a headline week. I'll this start. There

settling guidance? any updated to And that. I get metric $XXX great be It think price are Seaborne of ton. annual a your in around that contract then segment that the Japanese you your Thermal thoughts incorporating would value around

James Grech

Obviously, settlement haven't JRP that's not a the traditional this had -- we traditional occurring year.

bilateral negotiations is settlement what doing been we've what are we're So undertaking.

the results prices settled we a settled since agreements. side And these have guidance ongoing negotiations the right sensitivity of now There because in have our already. on bilateral is about anything is so do to isn't Nate that we talking JRP the in

the prices tons. like still guidance on going I So guess the active it we're other leave as we and to forward, have negotiations are settled in that in I'd

So I in prices not active prefer comment negotiations. while on we're to

Nathan Martin

opportunity of what happen? of met not said there prices you're in are what of guys today's the crossover that Maybe unprecedented only Lucas' thermal for premium even see of could displaying -- the moving into you be thermal you kind kind to markets, over to there kind market. to giving barriers making do question, again, kind met talk on maybe Peabody, What but globally, differently, think do entry about

James Grech

thing is so it sulfur, move of what coal, ash thermal I to look follow-up, coal the metallurgical and to metallurgical entry, go matter, come answer please, barriers I so if the of sure BTUs, technical just make the all I the one think answer quality that the can thermal markets don't When the volatile type at just I into do. you to question, you I'll number your the say not is Nate, Well, markets. and

at but number the if say [indiscernible] in cost, be boilers. actually obviously, I'd you one coal thing, then look that's consumed the you So

the that's issue. And so

mentioned I new think barriers coal, you in the thermal incremental or to I pretty is metallurgical to for should or coal high. whether barriers entry. something production, production And it's say, entry

so metallurgical isn't projects coal any there And big coming more online.

the the which goes what that in that some And side we'd markets, less rebound coal as would price supply tons metallurgical markets, result so into thermal in quicker at it makes into can, time markets. automatically hope the those the a

So the of high barriers on much is the the entry very, and to supply for new switching dependent coal. quality very

Mark Spurbeck

thing add. that Maybe to Yeah, talking about there's Jim one from more I'd just barriers wanted for mentioned, to add, And lot switching technical happen. thermal. a as of we're that into

great So selling tons on for million But in of want at prices the margin, of Seaborne that that diversified go million there. these a level. are there don't to discussion. a tons X are X portfolio the Newcastle can and Peabody's lost to Thermal some the on It's in ton $XXX of grade I we per time north

Nathan Martin

it kind some the could side, so market already things there that. see restrictions tonnage or we maybe are on near in initial thermal yeah, floated or was tonnage-wise, also what's my to I was this term, kind around the genesis I not out week. thoughts. that participate That thinking the was those maybe record to since question there of I absolutely. result appreciate Jim, agree, number fruition. guess the of out I Mark, Yes. a in met $XXX the comes that of I given mean, going is contracted like Obviously,

James Grech

under we're for Yes. -- going to commitments have honor our I'll those contract, if With we company. just commitments. speak

all take we coal it So and the to over metallurgical then just of switch market. thermal our can't

to our talking Creek you're Mine. about really, right tons that And can now, tons mainly uncommitted that's incremental So Shoal market. or bring again, we

mines as Australian We them of some ton. are of other at looking one our that for sources mine Metropolitan some and

specific flip have to still market, handle just So at that. a our we're because at find would can don't if many tons coal you looking I Nate how that quality. the got to coal we're hard Again, but that thermal the we great, we evaluating as be into for markets number moment could

And so do time it that. little bit a takes of to

Nathan Martin

just understand. and thing. Totally one maybe Jim, Very helpful, then final

guys for are mentioned anticipated. there how like roll to tons many you and coal, quarter. your off? the you around $XX Appreciate XQ hedged during left of thermal think get maybe an on mentioned sold still when Looks I just XXX,XXX about tons we update expect Can those you it.

James Grech

roll-off so off in now of have of They 'XX roll off heavier bit like less half XXX,XXX little those over will QX roll Yes, the million a XX metric tons XXX,XXX the the half tons the the tons We second finishing in of year. next or in next of second half to X hedges. about the than that, of XXX,XXX over half in half I maybe first after first months, Nate. 'XX. and would tons to next the

Nathan Martin

Okay.

So second XXX,XXX tons over tons? the half and XXX,XXX

James Grech

XXX,XXX in the second -- first half of next year, that's right.

Operator

Gagliano Markets. with And move BMO David to on next Capital we

David Gagliano

related, actually, topics But have more questions a a that so detail some on already the been of you've series asked. most that questions of covered. just are have I the little Great. of

that? if a total That's could bucket, if wondering my debt Peabody quantify speak -- was First specifically, you I target reduction little question. you capital allocation. bit first could has to if a

James Grech

the capital a David. shareholder we secured increase is value. morning, good million we've pathway we we've debt. the allocation, that's Since is $XXX XXXX, And to everything do first keen while the and of than eye said, Yes, as repayment to senior the repaid of On of do, debt a step. now more start said the with for that

so we've secured the debt. course We and that expect to eliminated continue

That facility to replaced And that reclamation the of right $XXX XXXX. long-term needs the address fund repaid, reclamation liabilities. about then once in continue we'll $XXX matures we for used now is million as to unfunded for million have look We noncash that's that remaining. That liabilities. LC to collateral be facility

David Gagliano

Okay. was on you're I at there still And associated options North with fairly wide. Goonyella range give restart, being Is a a there looking know was expenditures Goonyella? Historically, the Is terms there capital North of range you that a it's it the in range? potential and in then can evaluated. us

James Grech

internally. yet still evaluation. Yes, We're Dave, It's plan. part we mine on numbers haven't at looking the those of our settled

will, that would when ready me it to to at that to we So moment. premature give be you, Dave, for we're this but do

David Gagliano

side, Okay. holders surety on and on regarding with And the any then update shareholder negotiations dividends? return bond on restrictions buybacks

James Grech

Yes.

reach earlier. Just looking at further fully the agreement as will to our secured providers. final prohibit facility, reminder, spoke I shareholder a address We point. to documents which and fund LC we're need to the the this have position returns surety obligations. debt our in to reclamation both us And about the really debt with discussions long-term a surety That plan

David Gagliano

Okay.

switching the and Peabody's market Now gears to position commentary over here.

prices we've for My of the layered the XXXX. million in. that for for volumes think was the were price is tons coal -- X is million, thank million very average were the quarter. for priced. in for X I second And Of It's an the on delivery? of contracts was second PRB question the what of the obviously, committed the XX in price overall those as all thermal, price quarter priced that the and First committed you seen XXXX helpful all, PRB domestic are the thermal, that much that

James Grech

number don't catch you to to that have one have Dave, may number me, that with up of that asking. with later. the have -- mean, specific you're type we'll I I we

David Gagliano

specific. what to relatively average, framework $XX.XX. $XX.XX? a that be at to XXXX you is to -- relative it relative contracts have Can current guessing get higher. I'm give trying doesn't how It for that speaking, it to as high it's I'm that Sure. Is us is market to the

James Grech

X,XXX the used that I and Again, sell coal other was sold use coal I'll some there in calls. X,XXX. the to Yes. same we we the the other still some negotiations coals the left is for We're we of have and have of with comment the

still we're negotiations, going Dave, to I'm those on not just now. since prices So right in comment

David Gagliano

the it the a for PRB me of Okay. just And terms capacity question. part XXXX? rails out to out would secondly, then PRB? that in assuming the volume, PRB of the goes first approach evaluating of Peabody everything It's the capital quarterly to XXXX, Peabody? what themselves, River Basin expand fix my Peabody near-term of for the if well volumes increase on Powder That's maximum to volumes plans piece. in in is And that spend in for is And

James Grech

those David. our providers there. tons. Certainly, the we rail of end XX and service. to demand attractive levels confining here second next we certainly and guidance fixed to-date, the in fixed original full Thermal expect to expect assuming that be our guidance. year natural be as through here. strong been half rail our Rail with our had gas continues rail to would we to Yes, would prices. on guidance had given the has this be the were -- service is was conversations regular Certainly, We take factor demand PRB be is that on in I that top and all year. we the Listen, million that of at back go levels the is old pressures with

our it So original strong we're any without for year. is demand, look say giving guidance I as with I prepared 'XX do so, consistent that at this guidance for would would not to

David Gagliano

additions there this the is incremental capital expenditures evaluation? PRB evaluation at point? there capacity under under And Are Okay. capital expenditures for in

James Grech

Yes.

how tonnages margins. those planned did certainly consideration this as it's we There's under that certainly always If you At increase or year mostly from the Midwest year, tonnage around increase this the well. the tonnages equipment. prior we did can look, point, in

David Gagliano

perspective, a frame from was PRB. could is of one. world stays attractive just I where of out Okay. U.S. on, the going in magnitude export obviously, this markets the last order If the global I even XXXX. export into that in thermal more could Peabody's it And you then the is, the is market, wondering shift think of pricing I'm if my netback realistic -- sorry,

James Grech

was sure part last want met question U.S. how was I your the understood the it much of coal make to thermal the Dave, into that of markets. I Was question? shift Sorry, could the

David Gagliano

met, are Peabody I I said, how if now? netback What side, of No, asking U.S. thermal Sorry. much realistically prices current export out was versus the in the XXXX given was on apologize. would where I incremental

James Grech

the there's a in assumptions lot U.S., Well, of there. Yes.

customers. not You every commitment from you're And to you take a shipping contracts our that customer our mentioned long-term is that export the the domestic and to moment, at is to. away And to us our rail. ton you first one existing shift

we that loyal the make we and coal of shipping to customers serving we of want start are our the have base commitments needs before already. that for we So out sure country

-- is capacity of right capacity and now, incremental that becomes And part rail are there the capacity rail the their available port in is second situation. The an almost available. is and the ports same

occurring what don't but So for see at I we'd getting -- look at, at. look that our substantial us that we next for even take any guess, year. be but with though you're it's being a don't it, I a PRB see take something something that tons, doing we that is I Dave, I

Operator

Thank you. further And there are no questions.

would Jim So additional to remarks. back turn to Mr. Grech I any the or over for closing like conference

James Grech

us safety concludes providers today. execute at call. continued like again, also Thanks our customers, everybody Operator, as initiatives support. and said for And thank continuing and I our various joining to to Yes. our our vendors on the thanking investors, our I'd employees on beginning, insurance and your focused especially that for for remaining for

Operator

teleconference. That you. does Thank do conclude today's participation. your We appreciate

disconnect. may now You

Peabody Energy (BTU) 28 Jul 222022 Q2 Earnings call transcript