Warrior Met Exports More Coal

Warrior Met Coal, a leading U.S.-based met coal exporter, reported net income of $182.3 million for Q1 2023, a 25% increase over Q1 2022. The company reported adjusted EBITDA of $259.4 million for Q1 2023, compared to an adjusted EBITDA of $243.8 million for Q1 2022, a 6% increase.

“We are pleased to share another extremely strong quarter, both in terms of financial results and better-than-expected sales and production volumes,” said Walt Scheller, CEO of Warrior. “Customer demand remained strong throughout the quarter, which, combined with global supply constraints, kept coal prices above historical levels. Importantly, our focus on improving performance at the Port of Mobile produced positive results, specifically through several initiatives that were implemented to improve the loading of vessels, including the allocation of personnel and resources. We continue to work closely with port personnel to improve the consistency and long-term sustainability of operations.

“In February, the labor union representing certain of our hourly employees announced that they ended their labor strike and unconditionally offered to return to work. We continue to onboard eligible employees that are returning to work from the labor strike while continuing to negotiate toward a new labor contract in good faith. We believe that Warrior is well-positioned to capitalize on upside opportunities to our sales and production volumes in the latter half of 2023,” Scheller said.

Warrior Met sold 1.9 million tons in Q1 2023, compared to 1.1 million tons in Q1 2022, a 73% increase. The company said that increase in sales volume was driven by the drawdown of coal inventory levels in the first quarter due to improved performance at the McDuffie Terminal, which enabled Warrior to export more product.

In addition, increased production drove an increase in sales as both Mine No. 4 and Mine No. 7 operated at higher capacity levels in this quarter compared to the same quarter last year, when operations at Mine No. 4 were being restarted and both Mine No. 4 and Mine No. 7 were being operated at reduced capacity. Warrior Met produced 1.8 million tons of coal in Q1 2023 compared to 1.5 million tons in Q1 2022, a 14% increase. Inventory levels were reduced to 659,000 tons at the end of Q1 2023 from 855,000 tons at the end of Q4 2022.

Total revenues were $509.7 million for Q1 2023, based on an average net selling price of $256.93/ton. This represents a 35% increase and compares to total revenues of $378.7 million in Q1 2022. The average net selling price decreased 23% from $339.34/ton in Q1 2022 to $256.93/ton in Q1 2023.

For 2023, Warrior Met said it expects to sell 6.6 – 7.2 million tons and produce 6.3 – 6.9 million tons. As far as capital expenditures, sustaining capital spending consists of approximately $95 – $105 million, including regulatory and gas requirements. The company is also spending $325 – $345 million to further develop the Blue Creek reserves, which includes the final payments on two new sets of longwall shields originally purchased in 2022, and the final 4 North bunker construction.