Alabama-based Warrior Met Coal produced and sold 2.2 million tons of met coal in the second quarter of 2019. That was an increase of 13.8% in production compared to the second quarter of 2018. The quarterly sales figure was also a record for the company and an 18.8% increase over the amount sold in the second quarter of 2018.
“The market for Warrior’s high-quality met coal remained strong in the second quarter, helping us to achieve record high sales volume and free cash flow, despite softening demand for steel in Europe,” Warrior CEO Walt Scheller said. “We are pleased to have maintained our high production volume and completed one longwall move during the quarter, enabling us to increase our full-year sales and production guidance. Our strong results this quarter reflect our disciplined spending as well as efforts to take advantage of the pricing environment, which remained favorable during most of the quarter.”
Total revenues were $397.6 million for the second quarter, including $387.4 million in mining revenues, which consisted of met coal sales of 2.2 million tons at an average net selling price of $172.96/ton, net of demurrage and other charges. Total revenues increased 22.9% from $322.6 million in the second quarter of 2018. Warrior continued to capitalize on a favorable pricing environment in the quarter by selling its met coal at 97% of the quarterly Australian premium low-volatility hard coking coal (HCC) index average price (the Australian LV Index), the company said.
Cost of sales for the second quarter of 2019 were $205.2 million, or 52.9% of mining revenues, compared to $178.5 million, or 56.7% of mining revenues in the same period of 2018. Cash cost of sales (free-on-board port) decreased to $91.30/ton in the second quarter of 2019 from $93.90 in the second quarter of 2018, primarily due to higher production volume and lower spending.
Warrior Met expects to sell 7.5 million to 7.9 million tons in 2019.