Group 1 - The article discusses the recent senior note IPO of Ramaco Resources, Inc. (NASDAQ: METC) and its implications for investors [1] - The company has recently listed its senior notes, indicating a potential opportunity for active investors [1] Group 2 - The article emphasizes that past performance is not indicative of future results, highlighting the inherent risks in investment decisions [2] - It clarifies that no specific investment recommendations are provided, and opinions expressed may not represent the views of the entire platform [2]

Group 1 - The potential recovery of rare earth elements in Wyoming could attract speculative interest in the stock, especially during price pullbacks [1] - Analyst outlook remains minimal, with only three "buy" recommendations, indicating room for optimism [1] - Short interest has surged 73% since June, reaching an all-time high, while implied volatility is reasonable with a 30-day IV at 90% and options IV at 88% [1] Group 2 - Analysts have not fully embraced rare earths, presenting a contrarian investment opportunity [2] - The rare earth mining stock may be at the beginning of a significant upward trend [2] - The service offers a high potential for same-day trading gains, with a reported +227% year-to-date performance [2]

Core Viewpoint - Ramaco Resources, Inc. successfully closed a public offering of Class A common stock, raising approximately $200 million to fund its development projects and strategic growth opportunities [1][3]. Group 1: Offering Details - The company sold 10,666,667 shares of Class A common stock at a price of $18.75 per share, resulting in gross proceeds of around $200 million before expenses [1]. - Yorktown Energy Partners, as selling stockholders, granted underwriters a 30-day option to purchase additional shares worth up to $30 million, which was fully exercised [2]. - The sale of additional shares is expected to be completed on August 8, 2025, with no proceeds going to the company from this sale [2]. Group 2: Use of Proceeds - The net proceeds from the offering will be utilized to accelerate the development of the company's rare earth elements and critical minerals project, as well as for strategic growth opportunities and general corporate purposes [3]. Group 3: Company Overview - Ramaco Resources operates in southern West Virginia and southwestern Virginia, focusing on high-quality metallurgical coal and developing rare earth and critical minerals in Wyoming [6]. - The company has four active metallurgical coal mining complexes and is in the initial stages of production for a rare earth and coal mine in Wyoming, where a significant deposit of primary magnetic rare earths was discovered [6].

Core Viewpoint - Ramaco Resources, Inc. has announced an upsized underwritten public offering of Class A common stock, aiming to raise approximately $200 million through the sale of 10,666,667 shares at a price of $18.75 per share [1][3]. Offering Details - The offering includes a 30-day option for underwriters to purchase an additional $30 million of Class A common stock at the public offering price [2]. - The offering is expected to close on August 7, 2025, pending customary closing conditions [3]. Use of Proceeds - The net proceeds from the offering will be utilized to accelerate the development of the company's rare earth elements and critical minerals project, pursue strategic growth opportunities, and for general corporate purposes [3]. Company Background - Ramaco Resources, Inc. operates in southern West Virginia and southwestern Virginia, focusing on high-quality, low-cost metallurgical coal and is developing coal, rare earth, and critical minerals in Wyoming [7]. - The company has four active metallurgical coal mining complexes and is in the initial stages of production for a rare earth and coal mine in Wyoming, where a significant deposit of primary magnetic rare earths was discovered [7].

Core Viewpoint - Ramaco Resources, Inc. has initiated a $150 million underwritten public offering of its Class A common stock to fund the development of its rare earth elements and critical minerals project, along with other strategic growth opportunities and general corporate purposes [1][2]. Group 1: Offering Details - The offering includes a 30-day option for underwriters to purchase an additional $22.5 million of Class A common stock at the public offering price, less underwriting discounts [1]. - Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC are the lead joint book-running managers for the offering [3]. - A shelf registration statement for the offered securities was filed with the SEC and became effective on August 5, 2025 [4]. Group 2: Use of Proceeds - The net proceeds from the offering will be used to accelerate the development of the company's rare earth elements and critical minerals project, pursue strategic growth opportunities, and for general corporate purposes [2]. Group 3: Company Overview - Ramaco Resources operates and develops high-quality, low-cost metallurgical coal in southern West Virginia and southwestern Virginia, and is also a developing producer of coal, rare earth, and critical minerals in Wyoming [6]. - The company has four active metallurgical coal mining complexes in Central Appalachia and is in the initial stages of production at a rare earth and coal mine near Sheridan, Wyoming [6]. - In 2023, a major deposit of primary magnetic rare earths and critical minerals was discovered at the Wyoming mine, and the company holds approximately 76 intellectual property patents and related agreements [6].

Core Insights - Ramaco Resources reported Q2 2025 GAAP revenue of $152.96 million, exceeding analyst expectations by over $21 million, but posted a net loss with diluted GAAP EPS at ($0.29), worse than the expected ($0.18) loss [1][9] - The company achieved record production levels, but faced challenges from lower coal prices, compressed margins, and increased project expenses [1][5] Financial Performance - Q2 2025 diluted GAAP EPS was ($0.29), compared to the estimate of ($0.18) and a profit of $0.08 in Q2 2024 [2] - Revenue for Q2 2025 was $153.0 million, down 1.5% from $155.3 million in Q2 2024 [2] - Adjusted EBITDA fell 69% year-over-year to $9.0 million [2][9] - Non-GAAP revenue per ton sold decreased by 14% to $123, while non-GAAP cash cost per ton sold was $103, down 5% year-over-year [2][7] Production and Sales - Total coal production reached 999,000 tons, an 11% increase from Q2 2024, with sales volumes up 18% to 1,079,000 tons [5] - The Elk Creek Complex produced a record 688,000 tons, a 35% year-over-year increase, while output from other mines fell by 21% [5] - The realized price per ton dropped 14% from the previous year, contributing to margin pressure [6] Strategic Focus and Expansion - Ramaco is expanding into rare earth elements (REE), critical for electronics and energy transition technologies, with a focus on the Brook Mine REE project [4][8] - Mining at the Brook Mine began in June 2025, with initial commercial production of rare earth oxides targeted for 2027 [8] - The project has an estimated resource of approximately 1.7 million tons of total rare earth oxides [8] Operational Efficiency - Non-GAAP cash cost per ton sold was $103, indicating strong cost control, but non-GAAP cash margin per ton shrank by 43% to $20 [7] - The company has adjusted its 2025 production guidance to a range of 3.9 to 4.3 million tons and sales from 4.1 to 4.5 million tons [7][13] Market Conditions and Guidance - The company is facing a tough pricing environment, with management opting not to sell at a loss in a saturated market [11] - Guidance for cash costs per ton was slightly lowered to $96–$102, with annual capital spending expected between $55 million and $65 million [13] Dividend and Future Outlook - Ramaco declared a dividend of $0.1811 per share on Class B common stock, with no significant changes noted in the dividend trend [14] - Investors are monitoring the rare earth project's capital needs and execution risks, which could impact cash flow and strategic direction [14]

[PART I. FINANCIAL INFORMATION](index=7&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) The company reports a net loss of $14.0 million for Q2 and $23.4 million for H1 2025, a reversal from prior-year income Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $154,910 | $167,634 | | **Total Assets** | $674,646 | $674,686 | | **Total Current Liabilities** | $113,787 | $122,428 | | **Total Liabilities** | $327,207 | $311,880 | | **Total Stockholders' Equity** | $347,439 | $362,806 | Condensed Consolidated Statements of Operations Highlights (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $152,959 | $155,315 | $287,615 | $327,991 | | **Operating (Loss) Income** | $(13,844) | $5,415 | $(25,866) | $8,689 | | **Net (Loss) Income** | $(13,974) | $5,541 | $(23,431) | $7,573 | Earnings Per Share (EPS) | EPS Type | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | **Basic - Class A** | $(0.29) | $0.08 | $(0.48) | $0.08 | | **Basic - Class B** | $(0.12) | $0.18 | $(0.31) | $0.42 | - Net cash from operating activities for the six months ended June 30, 2025, was **$21.8 million**, a significant decrease from **$59.6 million** in the same period of 2024[24](index=24&type=chunk) - In July 2025, the Board of Directors decided to **suspend the Class A stock dividend**, which had been paid in Class B shares for the previous three quarters[68](index=68&type=chunk) - As a subsequent event, on July 31, 2025, the company completed a public offering of **$57.0 million in 8.25% Senior Unsecured Notes due 2030**[102](index=102&type=chunk)[103](index=103&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Weaker performance is attributed to soft coal markets, with revenue falling 12% despite a 10% sales volume increase - Global metallurgical coal markets softened in 2024 and 2025 due to constrained economic growth and slower steel market growth, leading to **reduced prices** for metallurgical coal[110](index=110&type=chunk) - The company expects full-year 2025 production to be between **3.9 and 4.3 million tons**, with the ability to adjust based on market conditions[117](index=117&type=chunk) - The company is advancing its rare earth elements project in Wyoming, with a preliminary assessment demonstrating **commercial viability**[118](index=118&type=chunk) Key Operational Metrics (Six months ended June 30) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | **Tons Sold (in thousands)** | 2,024 | 1,843 | +10% | | **Total Revenue per Ton Sold** | $142 | $178 | -20% | | **Total Cost of Sales per Ton Sold** | $123 | $142 | -13% | [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Revenue decreased 12% in H1 2025 due to a 20% drop in revenue per ton, resulting in a net loss of $23.4 million Financial Performance Comparison (Six months ended June 30, in thousands) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | **Revenue** | $287,615 | $327,991 | | **Cost of Sales** | $248,314 | $262,483 | | **Operating (Loss) Income** | $(25,866) | $8,689 | | **Net (Loss) Income** | $(23,431) | $7,573 | | **Adjusted EBITDA** | $18,794 | $52,978 | - The decrease in cost of sales per ton for H1 2025 was driven by mine closures and reduced trucking costs[137](index=137&type=chunk) - Selling, general, and administrative (SG&A) expenses **increased by $4.8 million** in H1 2025 compared to H1 2024, primarily due to higher professional service expenses[139](index=139&type=chunk) [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains liquidity with $28.1 million in cash and $59.2 million available under its expanded credit facility - As of June 30, 2025, the company had **$28.1 million of cash** and cash equivalents and **$59.2 million of remaining availability** under its Revolving Credit Facility[146](index=146&type=chunk) - In May 2024, the company amended its credit facility, increasing the revolving commitment to **$200 million** and extending the maturity to May 2029[145](index=145&type=chunk) - Capital expenditures totaled **$35.5 million** in the first six months of 2025, a decrease from $40.1 million in the same period of 2024[116](index=116&type=chunk)[147](index=147&type=chunk) [Non-GAAP Financial Measures](index=45&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted EBITDA for H1 2025 was $18.8 million, down from $53.0 million, reflecting lower market prices and improved cost controls Reconciliation of Net (Loss) Income to Adjusted EBITDA (in thousands) | | H1 2025 | H1 2024 | | :--- | :--- | :--- | | **Net (Loss) Income** | $(23,431) | $7,573 | | Depreciation, depletion, and amortization | 34,580 | 31,098 | | Interest expense, net | 5,048 | 2,812 | | Income tax (benefit) expense | (6,320) | 1,455 | | Stock-based compensation | 8,113 | 9,285 | | Other adjustments | 804 | 755 | | **Adjusted EBITDA** | **$18,794** | **$52,978** | Non-GAAP Per Ton Metrics (Six months ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | **Revenue per Ton Sold (FOB Mine)** | $123 | $149 | | **Cash Cost per Ton Sold (FOB Mine)** | $101 | $113 | [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=49&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company reports no material changes to its market risk disclosures since its last Annual Report - The company states that disclosures about market risk are included in Item 7A of its Annual Report and there have been **no material changes**[166](index=166&type=chunk) [Item 4. Controls and Procedures](index=49&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective due to a material weakness in financial reporting, with a remediation plan underway - Management concluded that disclosure controls and procedures were **not effective** as of the end of the period covered by the report due to a previously identified material weakness[167](index=167&type=chunk) - The material weakness relates to an **insufficiency of appropriately qualified and trained professionals** to perform certain control activities[169](index=169&type=chunk) - Remediation efforts during Q2 2025 included **hiring multiple qualified accounting personnel** and continuing to engage external professional services firms[171](index=171&type=chunk) [PART II. OTHER INFORMATION](index=52&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=52&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine litigation but does not expect any material adverse financial impact - The company is involved in routine litigation but does not expect any **material adverse effect** from pending cases[178](index=178&type=chunk) [Item 1A. Risk Factors](index=52&type=section&id=Item%201A.%20Risk%20Factors) New risks are identified related to the rare earth minerals initiative, including price volatility and competitive pressures - A new risk factor highlights that growth prospects could be adversely affected by **fluctuations in the demand for and prices of rare earth and critical minerals**[181](index=181&type=chunk) - The company faces risks from the **dominant position of Chinese producers** in the rare earth market, who may engage in predatory pricing or other anti-competitive tactics[185](index=185&type=chunk)[186](index=186&type=chunk) - **Consolidation within the rare earth industry** may result in increased competition and pricing pressure, which could negatively impact growth prospects[187](index=187&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no unregistered sales of equity securities during the period - None reported[188](index=188&type=chunk) [Item 3. Defaults Upon Senior Securities](index=54&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon its senior securities during the period - None reported[188](index=188&type=chunk) [Item 4. Mine Safety Disclosures](index=54&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Information regarding mine safety violations is provided in Exhibit 95.1 of the report - Information concerning mine safety violations is included in **Exhibit 95.1** to this Quarterly Report[188](index=188&type=chunk) [Item 5. Other Information](index=56&type=section&id=Item%205.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter - No directors or executive officers adopted or terminated a **Rule 10b5-1 trading arrangement** during the reporting period[189](index=189&type=chunk) [Item 6. Exhibits](index=56&type=section&id=Item%206.%20Exhibits) This section lists all filed exhibits, including Sarbanes-Oxley certifications and mine safety disclosures - The report includes required certifications from the CEO and CFO, Mine Safety Disclosures, and Inline XBRL documents[192](index=192&type=chunk)

Financial Data and Key Metrics Changes - In Q2 2025, the company reported a cash cost per ton sold of $103, which is a decrease from $108 in 2024, indicating improved efficiency [22][50] - Adjusted EBITDA for Q2 was $9 million, down from $10 million in Q1, with a net loss of $14 million compared to a loss of $9 million in Q1 [52][54] - The company anticipates full year 2025 production at the low end of the previous range of 3.9 million to 4.3 million tons, and sales at the low end of 4.1 million to 4.5 million tons [54][56] Business Line Data and Key Metrics Changes - The metallurgical coal benchmark prices dropped approximately 25% year-on-year, impacting revenue despite record production levels [20][52] - The company achieved a record level of quarterly production with tons sold reaching 1.1 million in Q2, up from 900,000 in Q1 [51] - The Brook Mine, focused on rare earths and critical minerals, is expected to begin pilot plant operations in the fall, with commercial production anticipated by 2027, accelerated from 2028 [11][32][56] Market Data and Key Metrics Changes - Chinese coking coal prices surged 38% in July, indicating a potential recovery in the market, while U.S. met coal producers have reduced production due to pricing pressures [20][34] - The Australian Premium Low Vol Index increased to $183.2 per ton, reflecting a recovery from earlier lows [35] - The company expects U.S. apparent steel consumption to rebound by 3% to 4% in 2026, supporting met coal pricing [38] Company Strategy and Development Direction - The company is transitioning to a dual platform model, producing both metallurgical coal and rare earths, aiming to enhance its market position and growth trajectory [6][25] - Plans to expand rare earth mine production to exceed the currently permitted 2.5 million tons per annum and to increase oxide processing capacity [7][11] - The company is actively engaging with U.S. government agencies to support the development of its critical minerals business, emphasizing national security [13][66] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding pricing recovery in the met coal market, driven by improved fundamentals in China and India [23][34] - The company is focused on optimizing production and sales strategies to avoid lower-margin spot sales, particularly in Asia [54][87] - Management highlighted the importance of government support for domestic critical mineral production to level the playing field against foreign competition [64][66] Other Important Information - The Brook Mine has a defined TREO base of 1.7 million tons, with ongoing exploration expected to expand reserves [8][10] - The company has received a five-year renewal of its mining permit for the Brook Mine, allowing continued development [48] - The preliminary economic analysis from Fluor indicates a pre-tax net present value of $1.2 billion for the Brook Mine project, with an IRR of 38% [55] Q&A Session Summary Question: Impact on quality mix and sales mix between domestic and export - Management confirmed no expected impact on quality and indicated a sales mix of roughly two-thirds seaborne and one-third domestic [60][61] Question: Estimated savings from the production tax credit - Management estimated savings in the range of $15 million per year on EBITDA from the production tax credit [62] Question: Discussions with the administration regarding price support for critical minerals - Management acknowledged ongoing discussions with the government but did not provide specifics, emphasizing the need for support to counteract foreign pricing manipulation [64][66] Question: Price assumptions for scandium and balancing supply with demand - Management indicated that demand for scandium is expected to grow significantly if a Western source is established, with discussions suggesting potential market growth [70][72] Question: Key growth drivers in the scandium market - Management identified the aerospace industry as a primary end user for scandium, with potential applications in automotive and other sectors [80][81]

Financial Performance & Production - Ramaco reported revenue of $666 million and adjusted EBITDA of $106 million for the key 2024 metrics[11] - The company's sales volume reached 4 million tons[11] - Ramaco's net debt to adjusted EBITDA is less than 1.2x[11] - The company anticipates growing production at least 5% vs 2024[36] Cost Management - Ramaco's cash costs of $101 per ton in 1H25 were among the lowest of its publicly traded peer group[13] - Ramaco's 2Q25 cash costs were $103/ton[23] - The company's low cash costs per ton places it in the first quartile of the US cost curve[24] Rare Earth Elements (REE) Opportunity - The Brook Mine is expected to produce approximately 1,240 tons of rare earths and critical minerals annually[14,75] - Over 40% of the total estimated REO basket consists of primary magnetic REOs, gallium, germanium, and scandium[58] - The Brook Mine's revenue is estimated at $378 million, with $143 million EBITDA (38% margin) at steady state[71,75] - The company estimates a ~$12 billion NPV assuming an 8% discount rate[75]

Core Viewpoint - Ramaco Resources reported a quarterly loss of $0.29 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.22, marking an earnings surprise of -31.82% [1] - The company has shown mixed performance in terms of revenue, with $152.96 million reported for the quarter, surpassing the consensus estimate by 18.31%, but down from $155.32 million a year ago [2] Financial Performance - The company has surpassed consensus EPS estimates three times over the last four quarters [2] - The current consensus EPS estimate for the upcoming quarter is -$0.08 on revenues of $174.19 million, and for the current fiscal year, it is -$0.49 on revenues of $615.13 million [7] Stock Performance - Ramaco Resources shares have increased by approximately 93.2% since the beginning of the year, significantly outperforming the S&P 500's gain of 8.2% [3] - The stock currently holds a Zacks Rank of 4 (Sell), indicating expectations of underperformance in the near future [6] Industry Outlook - The coal industry, to which Ramaco Resources belongs, is currently ranked in the bottom 13% of over 250 Zacks industries, suggesting a challenging environment [8] - The performance of Ramaco Resources may be influenced by the overall outlook of the coal industry [8] Competitor Insights - Warrior Met Coal, another company in the coal industry, is expected to report a quarterly loss of $0.28 per share, reflecting a year-over-year change of -120.7% [9] - Warrior Met Coal's revenues are anticipated to be $270.47 million, down 31.8% from the previous year [10]