METC - Earnings call transcript Q2 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the Ramaco Resources Second Quarter 2020 Earnings Conference Call. At this time all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]. It is now my pleasure to introduce, Chief Financial Officer, Jeremy Sussman.

Jeremy Sussman

you. Thank Ramaco second to call. quarter of you all I'd our to XXXX Resources, behalf welcome like of On earnings conference me CEO; Randy Bauersachs, is Chief this Executive With Mike Chairman; Operating Atkins, Officer. our Chris and our and Blanchard, our President morning

on statements, I'd meaning discussed of of Securities possible materially Any Reform obligation are call uncertainties the we the is of undertake is on or discussed revise Certain the outside of start, concerning statements made does or events statement which Ramaco normal future factors, XXXX. and control, forward-looking statement. not as statements forward-looking which could events Act Ramaco's law, of to will Private like Before forward-looking differ the otherwise. constitute forward-looking These except be it from our required results many statements update in which to forward-looking share represent not it the information, cautionary discussed statements. items Ramaco's by cause expectations are future today's the only to whether and subject speaks within and of as a that any achieved. These to results risks, as any date new Litigation results result other actual

our Investor introduce I’d under me the call on our With Chairman, to today's said, this and encourage let download Presentation everyone website, Events Lastly, go Randy on ramacoresources.com to that Atkins. Calendar. Executive

Randy Atkins

you, Thank Jeremy.

situation, team today parts country. everyone trying current by West in a now from our of discuss of second We're management our part of to in the something calling different is As our out to Part two in always, different quarter bit I for management Virginia, the joining we're Wyoming. thank today is us essentially want little results. given

this I'm operating this proverbs sure times. So other than by sure some again. in saying, characterize to last the by quarter all never experience of like about I quarter's to call operating an how Chinese quoting repeat kind not in environment we would interesting started I'm of

First, economic of never Ramaco is hope not it's also that Under It's lucky And activity extremely to last for that true smart. month I get essentially of much repeat. worked team we creatively and that that lucky all for of you quarter sometimes course months to hard. the us, of working two sometimes in three. April. a outage, hard than by I condition want to reflects We closed point the only were and better think our out for this quarter. of And be itself

solid conditions, quarter. Fortunately, despite able half post all the second overall a to financially first were macro we and

Protection EBITDA XX% you financing for XX% and we me about for quarter, April the XX know, U.S. on same second some statistics. PPP roughly period, X.X or XX and item received from million we of income financial detail and of in the bumped course, approximately million the the granular As half Paycheck Jeremy follow was that on million economic first Net quarter-over-quarter. almost numbers unusual the was with more up was this also One in in booked about that Treasury. will

other been quarter have of this able book income. X that to we result, a million as As

financing the completely expanded expenditures. qualified As pandemic. been furloughed back a that late That that result in of the we has had effects brought of been miners now XXX given securing about facility, March on

forgiveness. for accounting based this other advised been and could the also expected income standards under recent properly qualify quarter, counsel as treat have we outside clarified auditors this on our We since both PPP by loan that we

Elk operating When additional discussions for later we detail strong cost second mine this looked of did actually at the certainly May June, operate, banks our agent we and month of accounting booked PPP, results can applying results ton. such we've we $XX will when had per for quarter, had our and some Jeremy the during treatment. and costs again about our forgiveness be at year supply We for on with the

million, year. moment, dose would of forces, market normal on In the any I'll move with said, and well much an say with liquidity that all out way very We the our of to sentiment a the are which agility a some also at. pointed on of could sort pretty market of just short market optimism foolish leaves received to outside frankly, looking this respect and prediction. turmoil list managed are from quarter our be are There separate basis, line. ride headlights many And be earnings when humility. to we're to operating some in for which to by are by increase from and about provide weeks, us we geared unknowns in play order that, ability provide focus, is came even where with really is modestly which out there our this macro to continue read we too equipment a some out make or to And forward degree which perspective which as at normalize. $XX that the of which strong a facility in heavy it as market poised the much PPP our reality, somebody the meaningful, to this clarity at conditions to macro optimistic. react funds from remain six central a will I'm at tea tempered become trends in the financial, there of of of temper less terms But release, of to general seem market lead months uniquely any six afraid conservatively being

the wider what probably units last are in restart a you forward now groups U.S. certainly domestic telling they’re clearly hope below units the corner, approaching in XX% the around the since current a U.S. of forward, 'XX. some for is pricing trend which period some is the ton 'XX recovery. season. jumped passenger to XXX,XXX now first the bet in a at Australia, XXX,XXX curve are a of XXXX same is is quarter the maybe they cars in That's on about against month. blast that $XXX utilization The $XXX. X,XXX spot furnaces manufacturing up and units tender seem about are of U.S. looking of as to looking First for about FOB U.S. from steel a that June, is worldwide about upward current about XX% of all, about steel But have be has continued economic to April general somehow conditions reason creeping momentum. capacity

Turning And coal around to imported production between China, China's record all a the hoop been a no fully market ton. which aggravated domestic year, in by essentially met had doubt has rebounded. Chinese steel constraints lastly, hanging domestic have become $XX certainly around now the the And supply are and conditions. same hovers current

perfect demons. that add One market the storm can could three combine remain always most point, got you the to fact than at new any extremely have of liners contraction the conditions, designed that one us you irrational that to ton mining no some degree is my and remain the now longer kind fact access of pricing is market of liquid. that lousy little most one to supply or producers than producers and liquidity. a with is costs higher You've precipitate some favourite per have This that

also So, goes upon is season that It we'll XXXX see. without us. dance the of the now saying tender domestic

coals. we'll the where we successfully as and years. sure list the around, you this our time rolls this be earnings him week of domestic will to last our one few have this the over suspect again I line on our high frankly I'm submitted markets customers I up is so be Lucas prices. And the both know or able dance. provide year for able bids of disappoint year. either low report the ended vol we guess a in and do next And in have sadly on the We Pipes past next call our again But final not or everybody by to bid Hopefully will all executed I vol

inroads quarter shipment to making we group our test in also into new past hadn't first markets a we are did before. explored Brazil. export This some We

entered into Resources. forward move Square interesting called pretty market hope into as will Australia to several We markets time touched. Asian over a presence Brisbane, we in forward. We group years arrangement look able a And also trading to with Asian building of be we've highly a yet Square window the regarded not our the us provide

timeframe, on mine once of point so about both feel dry the feel direction. the the front, we've need reasonable projects, our strength one a until cost existing development in can that we interesting we we and of the low pull but policy on before trigger quickly in some the at to real these But anything we in don't at this up, I'm pursuing we any detail, clarity. provide very Because relatively market six we projects keeping all here some of month got We've see to or of bring several more going until a discussed. see liquidity these clarity, short XX could a On execute CapEx for us. production advance add level vol, low time and not online operate meaningful we frankly projects we a horizon. we've could new powder within can all to see iterate once, to pretty prudently on which very we if at projects more are new these Ultimately could a these talked they

let conclude the same with have time. continue the preached course to we to we some for So say my stay me frankly gospel remarks, that

we're We're we'll this debt, operating of a the we low a But see perilous upside, being degree philosophy, taste particularly comfortable of of react cover to cost. low kind low for quickly at point we got some when very feel downside strong bit prudence. for rewarded in We finally we are we've can hopefully ARO, frankly And little we opportunistic. market. we We're and in times. and a are these be with liquidity, operate mine this

now on platform Jeremy me to detail our turn provide to So some let results. the financial back

Jeremy? So

Jeremy Sussman

Thank you, Randy.

a the EPS compared $X.XX was In only period up quarter Elk and EPS little of from from Creek had totaled $X usage $X.XX based of in proceeds, Randy flow $X.X to same on we highlights, roughly funding our please million recognized caveat of American pointed terms largely that under The is of down the This payroll was $X.XX of XXXX blessed income from based Payment grant of as XX% With loan. guidance QX for million, running as accounting in CPAs XXXX eligible from over and months. the Protection two we $XX income the Institute out, financial auditors. funding XXXX. ago. second Revenue for of as remember, independent for Program expenses. a for down Other the of June QX anticipated our million XX% year on and was issued forgiveness QX by XXXX this

XXXX. sales from of issues. XX% April furlough On tons the from the of XXX,XXX, Despite originally our QX XXXX based period operational were a contraction same production than XXX,XXX lengthy side, weaker demand exceeded sales, COVID down related were which projected QX on in

put Second quarter $XXX were XXXX, higher per the ton XX% per from margins costs and year. period second last from margins from $XX into ton pricing on of produced coal company $XX, lower period at produced X% to in XXXX. average same company ton of same $XX period which the XX% per $XX Cash in quarter of QX down in at same and in price down second ton the is the back up coal in came of It in Cost the came of of on costs, down to quarter QX compared context. XXXX. some came important per

per came entire costs $XX ton for the mine overall quarter. Creek Elk First, at in

cash second Excluding April $XX average cost in Elk mine quarter. per the at Creek ton

be capital Elk from upon fixed mine a over growth by furlough While mind spread adversely management our a standpoint, having of we costs touch decision in virtually a today. tons. all cash the April cash to fewer made production was Last I Creek quarter to overall costs place impacted stop necessary also caused which the is to bit. expenditures want the still decision CapEx, limited

CapEx quarter. was our QX the came I CapEx During into the call, as growth certainly would $X.X that million. last at some in be second there This case said leading

it and this $X same down While XX% from still items. XXXX, roughly the was of from million two growth CapEx roughly included period of

later. Specifically, touch press upon the final in of million $X.X Creek million will Chris was Elk project $X QX, which plate our spent at

Subsequently, Complex. lowered reduce to early the $X addition, Berwind our workforce in materially at at by decision In XX% was roughly which Berwind our spend million difficult over Development July, spent there. we made our

levels of $X cash debt as now and $XX.X new on come This would to PPP. QX, and maintenance we in of an quarter $X In of our maintenance the in CapEx two-thirds on CapEx. XXXX CapEx are XXXX we forward, equipment levels. new expect below line basis and at $X.XX with Looking guidance QX of accrual is $X.X both debt, third historical took to per Randy ton million from consisting million million noted, of roughly

we forgiveness As said, for anticipate original most loans. of we ultimate or all PPP the

trailing our under EBITDA just as X.X times industry. It's adjusted the June level to months debt envy on, of XX net Moving XX. of remains the

items were XXXX of capital million XX. $XX.X In number as addition, of the liquidity have half first is This a despite cash. working as treated use June of we that of

inventories have since by $XX.X out million year. beginning First, I the risen the point that of

in XXXX lowest back at comparing end $X.X fourth receivable sit I especially quarter half decrease now items accounts a year, their increase we of level in in quarter, which Second, of a a to in cash anticipate the quarter. working payable, the and $X.X had XXXX. first when million would to the second capital million accounts We since be source the quarter note

to Lastly, have I our take in be turbulent they to will good we to do markets I'd CEO, know would one Randy designed Mike not over the We times operations usually noted, again and investors times. our resilient times turn that to the advantage call good in Mike? and day when President like strength now of in roll as remind do. Bauersachs, as

Mike Bauersachs

Thank you, Jeremy.

The Resources. unusual second XXXX Ramaco marks most quarter the one of at of experienced quarters to-date

by employees, with with quarter of contracted will public face and worst some our primary progressed, customers our we the be and being in company, dealt sales. both concern the pandemic, how As impact the uncertainty impacted as the the we our turn that to a

idled have things Our with view from customers demand furnaces some is today this and the year. earlier picking domestic stabilize, that sector auto seemed blast to up restarting

continued production the increasingly to demand the Basin we While coking actively be the Atlantic to during of keeping a markets. more influential a face nicely back it import appear standpoint. and space. perspective, improvement. shipment to will in seaborne the recover hope we Recovering continue data India challenging, they but demand slow most From Conversely, COVID China, the see and continue steady quotas, we in to enforcing manageable, in shows be appears mover downward continues marketplace XXXX, on marketplace macro half has and traditional improvement, the standpoint, from in to domestic challenges from reduced been important to see from steel recoveries recent pressure coal pricing. disruptions especially

sector recovery the the key need will to instances, production coal While most supplier a term swing surprised unite, there of It sources and spending. impactful a concrete were a of all continued effort into Union's stimulus near we European by point the through to even the in metallurgical particularly members are Like production, form recently for from be cutbacks, ability oversupply real others that the enter infrastructure more to share seaborne for traditionally to in U.S. appears market. the to government borrowing. stimulus

in term XXXX reach show by positive near That that and domestically to their have actions international a We Korea And project their in impacts expand We're from the projections in should feedback a bound X.X%. first in in shrink in the efforts small stimulus positive rebound customers. our our floated expecting taking loaded X.X% XXXX, metallurgical and economy We recent our quarter coal to position. This recently sales steps producers. the they prospects internationally about is shipment While all additional our with just Europe. second to customer. on of for turn EU positive could our help growth goal. for but vessel

to another we first, Ramaco’s this loading which Brazil, first coking customer in America. trial South large to new a any will there. at customer time to shipment year In large first cargo high agreed mark The for volatile a

international large in force change in majeure customers have provided market. customers remains impacts. guidance Since this murky, with of and for to domestic the Ramaco’s we last spoke, to business markets still it's very during business new quantities positive time relative success material the more and securing know While opportunities unprecedented adverse

performance. a Additionally, we've customer had XX% a half material our an back smaller instance to where fewer of The will certainly has on contracted take have tons. opted impact events these cumulative impact

All make We of business. to out confirm to XXXX have come this shipment most that domestic and meaningful American it can continues for provide North difficult uncertainty other customers also any guidance.

everything it's from in where our too to the remain settles competition. determine ability While confident differentiate products early our out, we to

We power, reserve in of staying our also costs life, have and confidence industry. lowest long in the the some

be mines historically capitalized One well has need regard XXXX additional sulfur, sulfur by to should our our to Creek worried and increasingly that be a Our buyers migrated and low with associated mining product. targeted has who our risk. products. even comparatively is insolvencies of better into about to effort focus areas ship for low new had but allow us and market Elk will performance couple

a half fewer our product, Relative the for lower to on face we new of with customers be make their of match and Elk expected volumes part their April, Creek of to we low workforce. sulfur can plans developed our hope our As second emissions furlough have producers restrictions recalled a during to who production, increasingly We've shipment XXXX. most following solution. production

are Elk our well. running mines Creek All of at

second will actions Xth extended one also some seen remains holiday It the for week if furlough employees. our be be July required week similar adding half. by We in additional to

safety lengths to to related concerns to address to We continue COVID-XX. health and great go

to will Chris remain substantial a reduced we've to safe. levels. make to pandemic our decision discussion workforce. doing following substantially had Berwind reduction operate keep possible make employees mine, diligently the detailed guidelines our provide The At of mine are operations our continuing and everything Our a to more committed at is our response. we difficult to in

infrastructure. ship coal continue clear of has a the make We path remainder to to their option consumption Berwind. to forward the number do We want It altered management who for has that for at year. having our customer it primary to a includes downward options the is market Pocahontas if which the supported. months block develop of six reserve Access small Berwind also this be complete. drainage, the include in approximately near conditions a accessible developed can and our slope, #X months few in proceeding to of coal seam, Alternatives Berwind coal with to will above take

believe and to continue coal quality availability that express abroad, domestic our forcing Pocahontas fit long will Berwind high customers, of inquire great a to continue be both trial a interest and for for about low pressure who list We shipments.

uncertainty. We labor market of light to decisions continue virus weakness in CapEx over and current

how more our the settlements, we As domestic over call. quarter, with hopeful to we things we see and color up third quarter develop growth third on CapEx in are end where provide

continues continue Our suspended remain capital I Last see to discussed and sector. the the quarter, we the investment fact of that guidance to lack in today. lack of

also saw We cost or competitor last from be we competition. week our of for another will during potentially more there Unfortunately, that predicted discussed and structures so, failures bankruptcies and XX. file challenged Chapter some more the

We present that focused investors on taking that advantage opportunities also remain reminded themselves. of we actively

in provide expenditures small that agreement entered a into our perform the than nature, to was on to to remain value with especially peers. in to the less we Ramaco bankruptcy to profitable in Blackjewel allow meaningful we access continues reserves in an permits quality situations. create levels that the In Jawbone This could at surgical high Indeed, us focused but seam similar ideal control. couple of just future. conditions, compared transaction debtor fact, Ramaco avoid acquire capital and Resources

It the while immediately than producers a substantially that cash. some the liabilities, While have larger undervalued In bankruptcy. make see to the the able result in valuation Ramaco Debt Ramaco philosophy management competitors. be assets, much cap market differences still larger the to the appear of company only is not maybe in to that believes in its would market, that management are downturns. ARO investors in a beginning company by result majority not do, will withstand between pledged Ramaco cases narrowing. eventually like coal much debt. greater our repaid, gap the gets spending sector entering is

virus analysts that be structured company induced said who work is the our facing way a like to in the in summary, strategies In one is would any to of thank ultimately the we've continue XXXX. cover clear others remain confident of as participating those Like the will that challenges we from this sector, through to of benefit especially everyone As previously, winning current our who TC. Ramaco way remainder we call, I downturn. prove the is set

things we're As would just on some Blanchard Chris opportunities. in our a second quarter we're and and like our problems additional management also to focused obstacles, general. now team, on I over into not provide turn focused insight to will who operations

Chris Blanchard

from the Mike. Well, few operational that for milestones XXXX there discuss you, morning. and some of a this will strategies remainder our I of Thank briefly quarter key second the were

workforce. our First, health always as and operational safety our remains of primary the concern

at can the pandemic conditions adapt We've month. steps be over During have home this has our past to widened taken prudent COVID-XX our work. we policies and our has continue as and developed what both the we and the to virus of how period miners, and at global as focus affect changed believe consider to procedures pandemic, proactive the

during equipment. widespread employees equipment and the to to pandemic distancing, space. of common mentioned, the As to operations returned social sector, all requirements. focused and were of and prior now of and material protective month coal provided to We the a global of our personal during weeks upon the three sanitation the assess recommendations steps the situation action April or that develop the plans. was areas Most throughout both April any previously coverings furlough idled Face uncertainty prevention of most all were following as well declaration of and operations March one the was steel as taken created the of

in distancing possible. require to face areas not or enclosed We where continue coverings all is social

having carriers and despite buildings their We these capital are all focus the during limiting additional our for on dollars minimizing now regular from congested we can period, offices schedule. more spending capital of during a Also, also space deploying deep and that are workday. on sanitized miners have co-workers our additional so personnel otherwise machines in travel portions multiple underground the and current

As also different our and continues work increase the flexibility and to West most the place miners locations locations where occur. to the for coronavirus may guidelines the to cases while provide Virginia, spread the we COVID-XX in continue live, of plans for to modify them for our latest scenarios work. rules Virginia our Contingency that families are adapt workers' governmental and in providing and safest our to action policies

to capital Creek our earlier, the second we building brought our completed turning of the that into discussed Elk second Now at one construction, plant. press we quarter, during projects plate operation full and commissioned

presses. underground, Central part disposal more capacity towards the of that additional Creek from turn upgrade, permitting we presses our our plant Elk the operate have throughput the preparation under upgraded our our rateable of medium of which any Creek under the of a refuse expansion now this that rock, is the combined existing to needs entire also place now plant Elk give enough for either similarly be presses growth consideration needed Elk the and second plate technology now Creek in of to the a XXXX, to and in fleet two us is And spending Elk able for long-term to of us on relief waste presses capacity the capital way maintenance of for Where four containing excess with maintenance of economically confidence new after our prep impoundments. We of project future and Creek anticipate even sites of some plate complex. The mines third the handle disposal the Creek projects term to a fourth positioned will and Elk presses complete, in Ramaco life scenario. gives slurry fine total has material do edition fine have waste the first believe not We disposal in With limited operational planned refuse flexibility capital is rock to and successfully Appalachia placement equipment. strategy. traditional at gave

actual all exceed we generally to Naturally, coal foreseeable overall, Creek state of and Turning these complex mines operate mining continue for have future. favorable in conditions. is poised each flows the the and our mines and location, ebbs perform the Elk to expectations are but operations, to at

also a judicious the those industry. costs operate the saw actually we're shipments. of Basin to coals the the have month-over-month, reserve where remainder the a capacity. In cash result solid clearly we the of we advantage serves seeing second access and will areas Even deliveries of of qualities our in This balance and XXXX, into moved in deteriorating our of geology, that were quality whole. investments We is to Appalachian was were We emphasize as quarter. the the stark generally cash costs the and Ramaco of in lowest in sales the and or furlough, experienced and some the pronounced workforce, our deferrals cost difference at a favorable competitive and quarter, however, When creep equipment negatively and April our improve impacted capacity, has contrast as between reserves. by the amongst be quarters. between a the to In counter as even near which mine certainly first more in quarter closer upward the saw costs lower production was infrastructure best as costs production our largely Central to

strategy second same the tenders profile export with and potential time the At to sales participate our continue throughout to while delivery management remaining needs move they spot match as is in disciplined spot arise. XXXX, to sales. we take production to As half and still of will customers’ our nimble a schedule Ramaco’s approach

do the that usually the we race space coal overhang profile peers, there markets normalcy. to our eventual targeting to no one focus while the and with to company prudently positioning on to not that and need is in return underbid our bottom continue We'll with key cost current production While synergistic could the is for customers, advantages doubt win. this we supply the

we difficult Turning Elk some following to decisions. and make to principles that following same at the very recently Berwind had Creek, we’re

In throttled reduced we state production in production our and forced in made. a the finally idle to in of these the be project, were had slope to the our to changes April make needs customers. addition the construction to I July we market Unfortunately, result to and want as of decision June, our times coal permanent of conditions. and look reductions fruition shifts early mine overall future extremely ramp back safely at this when forward Berwind production and able couple have coal efforts Since efforts. bring mined I formally the the planning continue all years. that we’re mining inception, to been challenging exerted developed have at past to employees’ the our these Berwind recognize miners to up through and of of

quality months, move low remains see Once volatile hot and status to Pocahontas for place all we higher excavation restarted and near with in costs, and daylight commences restart. believe Our quickly Berwind lower the productivity equipment project excavation higher in horizon idle slope within infrastructure six can and on can a #X immediate we production.

higher less less to conditions higher starting, XXX,XXX following and to capacity the downtime the production recoveries, the we usage six the mine the thicker can production of of mine result related slope at months months current clean fully in mechanical we tons. plant conditions. believe annual Berwind initial consumables seam Within XXX,XXX coal construction of commencement, of seam productivities, XX strata sandstone coal The seam PX will budgeted approximately or

produce will lower the mine has in costs our the these of current our seam. experience put All Pocahontas#X been development than with substantially

our long to term in coal deliver our of uncertainty, and initial and balance Berwind of Access only continue mine the we modest Berwind to the we area requirements development quality growth options. reserve. through other requires and low reserve tons be to volatile tons While permitted and Pocahontas#X mine will be plans in production a small mine. very One proximity these liquidity, close PX that at to the seam in to this expenditure. from customer expect the potential would similar potential our look capital continue is development These production access period to we located PX

to reserve provide in Randy. million less concludes short on main the tons. bridge to our than X development crystallizing us option committed targeted for contiguous program mine to This Dependent it completed the and given current remarks, this now forward PX back and this is We this levels prepared mine portfolio the overall over production until process XXXX will and remain that its term our in sales course. over reserve, mining And not their Berwind market, months annual rate turn believe the be until uncertainty growth could a management's could production run the give in domestic with through fully While Berwind within with next low the Ramaco’s seam. few months. look variability -- development to this appropriate from production current does another and our I operational. mine, Ramaco’s XX export the the strategy volatile as Pocahontas#X coal We is PX and and tenders annual the of thinner

Randy Atkins

you, you, Thank Thank Chris. Mike. Great.

happy to we’d investor out point, of some So any there. at be the from questions or analyst community take this

proceed? if So moderator, you could

Operator

Instructions]. Pipes [Operator of Lucas with line question B. comes our the Riley. first And from

Lucas Pipes

it pricing seriously, wondered have of and customer I amount tenders XXXX on fill to-date? us on anything the timing the what domestic of remarks, missed to to XXXX demand in product? able course, More of but I been prepared in that’s be clean on is in based ideally able may by there should domestic by Randy

Randy Atkins

information for on to Lucas, me not this you've have up get keep and appreciate last two try this I'm to the behalf. But to we're been because Lucas Well, basically you remark the bombing again your weeks I pricing email it. probably that and that we step trying, come realization Sure. going year glad appreciate

I as -- said, the they think tender it's is So, as out early. a as came far I 'XX concerned, little bit season

proved to We bit, a probably I -- little a in way on their feel of demand precedent they reality stand I probably for requirements their that check standpoint. their probably, suspect the own under companies again, trying is felt bought through 'XX. year in sort think but last are the steel just that fog hindsight, assessing of terms their from

that a out numbers. at market 'XX better environment size come looking surging 'XX, tenders a We're where they've in with dealing than are think bit benchmark have the little a exactly I price the not we against. to

approach in continued forms there. So, And, various obviously financial we've to with distress. realism this of are certain producers have got a we that some

a get of at how that peers and play will sure the some look in that I'm role, our market. into So,

view some peers trying little the So, our half commentators that mentioned I might remarks, even taken as in number might steps you posture disagree you on quickly, I positive the the same vaccine resurgence maybe terms lot a get feet to with a might now. that economic back next a have I and very recovery. my But year reverse view of and market. humility bit in or that their token, really have right things general, got have impede the than brighter they the can't could a think like markets, maybe impact of develop again, when forward steps also on that a of in notion. that have quicker everybody I virus powerful little being of in would any a as By of of second we've

a approach least here, as optimism. approach of on realism. So, certain we the lot certain approach of the said, I our with a market all of humility. view table side for with we again, But, market our market importantly, a at We think, the with I most us,

hope your most that kind of of addressed issues. So, I

Lucas Pipes

very Very, helpful.

immediately the Just follow-up of a quick kind market domestic now. on

your of like position having enviable not the in substantial are peers. some leverage, You of

Asia there right of powder you by So, now international may hold the in selling XXXX. thought a and -- is recover market that just is look, maybe a of this dry of say, more to then, in But try the let's Asia then what if off, a keep sense of is wondered and give sales new the -- really a could year. for in what be you is us part could kind coming percent Pacific pandemic. by of kind on intrigued where that of school of contract the this more to the plan And that secondly, let's market middle extent of over me, partnership may would the that kind we go Is strategy? that

you really appreciate perspective would on Thank I there So, these? your

Randy Atkins

Sure. Thanks again.

in but think, going gives good got us sale, us a provides our we think cost obviously, I I alluded think, differentiation approach some we've but with equally position of our sort candidly, certainly bit one, pretty as with pricing But our producer. maybe a little So, we're to of certainly we're I our part granular too quality you, get leverage wind position to, dual peers coals and thermal some not decisions. as Mike not

think our that that as little pure cost. of, bit with high gives we're met products in us So, I quality wind I are said, a sales of because low additional dealing and

of general know part And, gives I percentages gone it kind domestic, percentage of by design, So at you table of in part that’s pretty that's seat of opportunistic. had of on take call think years our by sort that to us approaches. penetration what been let's good that markets, the realistic some a

have with we think kind philosophy the past. I of in general same years we approach

markets him, are ideal an to handled. relationship pretty regarded into had domestic frankly, they here, as had in So partner in the a reached that frankly past we an and came who trying had to Australia done decent group. as this are from sales which we'll find arrangement U.S. Square positive viewing colleague, which in expanding and met analyst see. and development The your what both Asian as out grow sized some trading they around very They life group who with work to some Mr. Sussman a

handled little number. XX million basin. year they're we think or And pulse look West they look I on are over is under time. in Kentucky, relationship. pretty Far Asian array have it's your forward of We are the very pretty over think in any bit a very East. keep of they to very building away. and the And which vast And a throughout markets we a people tons they far Wyoming Virginia throughout group. healthy finger that met, forward And that Sitting the a there here experienced good markets frankly, relationship to offices will that very, to daily of tough knowledgeable

Operator

question comes next Benchmark. the with from our And you. line Thank Levin of Mark

Mark Levin

reasonable half volume to mean, I of recall, high shouldn't questions. in related ‘XX to so bowers] of might've two trying the kind about [My conference talking more domestic when sell your I domestic would know monumentally that it a volume case? proportion sent changed of of things or lot foothold you a and been market remember It the into than can't a a I was there. at that guys asked is that high or sold I keep proportion a domestic you call Lucas, ago. have your was. be it or into or assume market. least actually have half necessarily the

Randy Atkins

on in is sure just think this kind opportunistic and Mike talking the develop of Mark, you're be you and I to going a general, let market and think certainly when up when to about going that sales, expansive follow characteristics. to I’m volume I pricing give but what quite perhaps spot got answer, more you're what never

We said, healthy kind we cover as kind And that once approach, and the kind feel our treat domestic I pretty for of upside start So, take we’ve business. the of downside care export covered with we’re of always load to then, some going itself. dry got let's of powder of business.

about we're some kind wise? new Mike, also that the what But like bounce you going on of around. pick and and the don't ones up export why So, looking of talk execution started opportunities, at probably to It's maybe number looks remark we've on? that percentage an

Mike Bauersachs

down really up we of grow really us the that great stuff for domestic we Atlantic the to going do a low North we and Elk the at continues amounts with the mean, is and our of American of market is Basin coal recovery, we're sulfur we've especially us of challenges in to like to fit that a from we is Korea. have growth are build of the customers participate there, sales distance those we think our of we for of and a our you'll the number is think important. We of things deploy think looking coals about virtually to of Asia. that's that I that basically and continue of kind the you of continue Yes, that have that see -- some guys we very a priority are outsized be and part we've to us them presence. see down put that all to we're to to this set be, what at capital to it's our Atlantic it's -- And this and in contract course, in you'll products the many think which month world continue mentioned America. one and that have are for certainty being ports. the focus we internationally, focused really make I continue tenders kind experienced with really Creek, the and in think you But XX customers differential Brazil while got have ahead shipment going have some on the with or quality the like, It that And, an on look why a customers, going just internationally. of while difficult think of internal are optimistic to all, of about sales really where most because now. reasons Mark, are those market the Asia test amount have the sales that continue mode trying is call of helps the Basin, of I and And domestic I growth large many and real think front one to there key probably course, in is us can sales a just I successful share to it's to that Eastern world, South first of there that have some year. part think slow And maybe I got our good important

So, a bit. hopefully that that helps little

Mark Levin

No, very questions... that helpful. was quick Two

Randy Atkins

we before me just that. go one quote sort to your let question add to next Mark, of

alluded the potentially got about, under lowball, talked call last couple think that frankly, in bit remarks could add we I for where year. of is production, we this of projects, development particularly a X give sort think I my of tons million I of of quarter's we've all little new interesting are where which percentage a we meaningful us, very pretty which a earlier against and a to today, bandwidth million coming as about So, a is this the out they're somewhere year, X somewhere south in tons

pretty could if want which somewhere, some us more less to So, on not things end month we export next we might we that depending specific up that ‘XX, as here I upon much by full we were since we think course, necessarily to could August gives a project those today. delta for in of we bring year, terms it think to a exploring ‘XX, opportunities, tonnage in add, even good timeframe that X XX to in perhaps where And of other runway August gives us lot as a is, of which kind lock the able sit year.

at new at the modeling. But again the a looks more call trigger think the serious probably you in new projects. and really take help ‘XX certainly look wouldn't to market market. too think some or position certainly change real we it be for going a couple the from looking project. some does it. things So But pull that the got to to a that legs start the really, general ready on guess starting I to Berwind one it's perspective up under perspective could that of I stronger, doesn't good much we're on We're we're

Mark Levin

and someone then I'm question. ask let very ones and That's quick else two going get a off to helpful,

kind ideas being risk Randy back majeure the shipments with what's the maybe to you that mean, reference the way have Jeremy year your first the of best at about me in to out for release? or of approach of kind given I and half potentially the your you the sales that modeling your model half can The that footnote letters, some how us of there. XX% in is give due back force to thoughts

Randy Atkins

of I trying as and all, take are talking who’re Well, of much I'm as to of models going beyond perhaps to frankly, respects, that, let you that's the matters sitting Jeremy the perfect you're here accuracy producer the some that to a why constructively a pretty can, mean, even control and dealing but for with you the control customer. in certainly beyond create producer with much as example

So Jeremy from take a a stab numbers that at standpoint?

Jeremy Sussman

of give the guidance reasons still we've not any one elected official I Yes, to that’s Mark. why mean,

work reality we contracts have the as as just we've can, relationships whether and, were we'll committed it's and if signed much the preserve as you both ‘XX, to customers hopefully calendar value all So, certainly is going given tons with given long-term the that our say. not XXXX, we're I think sides to of the into

Mark Levin

you onward, production capital is total were in be required talked to time follow think position production talking or to What or can't through, my your this you to about would point doubling be was, going guys -- if XX I months. that double XX about Chris next, remember it had approximate I it? we the was production previous the in And double incremental from was over a one

Randy Atkins

then, with number and certainly Well, question, going certainly number, gets We mines on, depending a around. properties such Chris, would could but tonnage new capital which but sort to our $XX million we're upon would point we've specificity I of tons. of think, could smaller as Berwind calls, out define previous couple we've other to that rather, said, pull million is think $XX probably, in we of of numbers I develop. the max in And XXX,XXX which I And at plus kind that which alluded I part Chris were expenditure. that bring at us I got we to that moving trigger, of high course, certainly mines, somewhere of capital, general target think, said the look as let that we the your the a that to,

level to maybe a of give So just call time just on back comments opportunities. Chris the roll these last couple our production on machine high

Chris Blanchard

Randy. Thanks, Yes.

month So between those and for low depends at projects. obviously would we all And a and there the period, a over the XX that on to XX slightly are side, to all numbers do we all your XX, XX, question, everything vol Creek roughly we to if number vol tackle. up once, of at we it generally. probably expansion XX the in then low side looking if a XX gets were the if that choose then But bit how the high we on are bit to how line place little upgrade. larger put those have do do way of in many little on side, we you expenditure there's within lower, But plant of answers all depending capital could the projects somewhere at that mines and Elk which quickly

Mark Levin

-- it's essentially, incremental -- high other capital million, so side? only Yes, get to million X capital on XX the for of to me

Chris Blanchard

our expansion a of lot a so your say, of I development into of transition bang reason going for thicker a you'd mining a we spend expect Pocahontas lot get just fleet our at project. of was to our capital lot is at lower you capital a buck bit is the from the Berwind lot little equipment mobile floor, that than

Randy Atkins

you, the to we find a real more kind dramatic of XXXX X benchmark $XX I get a just touching X.X, general, were less which is a end to remember production, we sense singles go would even we like year. about we as position in are us to would sort a early of to not would we of a still that, as along ramp-up we've in like Also, if of with of the certain the think periods couple be would incrementally in experiencing the Randy, getting I where fun $XXX this year dispatch kind the flatter today. market Mark. we that to of move uplift and had doubles in market part we in we And the proportion, look of another the permanent than can to kind you some assure at ran $XX nostalgia, market from as pretty with if but toward ourselves perhaps find sort of

Operator

Thank you. Clarksons. the And our with Schier next of from question line comes Scott

Scott Schier

once market be flexible lag will see activities we On there be starting the and the immediate restart restart, more little of it just start for demand of a recovery, development once in of to will bit getting return be and workers how to sure recovery price you of holds? back this you effect to or will a make see kind quickly

Randy Atkins

Scott. Thanks,

make sort and I'm I to of turn to over Chris. sort a remark again it of going think back maybe brief then a

we hallmarks I of from our we're one So, an react, ability think opportunistic. think, nimble to is and pretty

development reasonable Board, of with these detail. our in We discussed projects course, of have, much all pretty

have production reiterate probably we much of as some again, comfortable we And the borrowed relate that, are. sense it pretty We've expand we familiar the spend more we additional Chris, would they're if you money got, these or operational some of to quickly, necessary from kind some liquidity, spend. our So, of needless But with the them. increases? we in powder, our own very banks liquidity pretty don't why haven't dry of resources upon that are where could say, detail to aside to money our because with draw could with

Chris Blanchard

the we're workforce standpoint, to clarity to needs and we And, at once could the reductions we place. our would a did -- we dollars both the and we've capital the this Berwind. can in bit of deploy doing So we direction of little unfortunately or have for as I From fast development we workforce had it customers, demand make be on the the slowly as market as point everything needed. deploy projects and protect think at

months. of we of to believe right XX of could time stands the However, months Berwind part running as workforce mines on needed development other part developments at it large six we the least the as between and that the expansion the now, that slope because and some in staff grow the are

Scott Schier

some to as do you helpful. the from higher And without That's great. costs, it's using third the the think costs on Okay, Berwind moving to cash impact costs of quarter, then of the reasonable assume Creek, relatively they're by as additional it's to being get just soon stable, and then aren't there COVID-XX Now obviously lower XXs? into really impacts? kind Elk the of mid driven that any

Randy Atkins

going I'm to both and Chris Scott. the Mike on Thanks, let comment that.

So Mike, costs? you on don't why start

Mike Bauersachs

mean, I'll when I but environment, have And number. our coal in this cost impact to we let Chris that of kind of not that. to like look our you Yes. I look be that of mines in of look kind we really a But impact helpful I kind does structure add at development when continue having good entire of very on you're mining Elk with cost conditions. at Sure. top yes, Chris? feel And Creek, when mean, -- think structure we that it's at when average absolutely at we the sort the

Chris Blanchard

already, the impact from sort we that normal COVID we Elk that fourth the impacts. see the I our to in should I Creek historically and development expect of range, is type are expect on would to in weaker we absent quarter that minimal quarter holiday coronavirus external of the everybody that that but we project that would because periods range. be No, think call return remind Berwind that run quarters they cost with -- the of would excepting can the shutdown period one two

Operator

for the back over remarks. I turn you. conference Chairman, Randy Executive now Thank closing Atkins to will

Randy Atkins

participating everybody appreciate call we always, as this again, Well, moderator. you Thank for QX. in

please these I to with speaking hope look like all us, here kind We to our of strange And pretty that for we're hope a said And to We through best cope months. some importantly, well. with unchartered of improve stewards would on I good conditions hope sailing And knock times. you most call, improve. everybody few we'll stay to are pretty forward pretty certainly able Thank we're on you stay market being investors. the to very in say I on be all as doing As wood, we waters. our the safe, much.

Operator

this gentlemen, concludes today's Ladies conference and call. Thank for participating. you

You may now disconnect.

Ramaco Resources (METC) 7 Aug 202020 Q2 Earnings call transcript