American Resources(US:AREC)2024-08-19 20:06Dividend Announcement - The company announced an adjustment to the record date and distribution date of its special dividend to May 27, 2024, and June 11, 2024, respectively[60]. Coal Mining Operations - The company operates seven coal mining and processing subsidiaries, focusing on metallurgical coal for steel making, with no sales in the thermal coal markets since mid-2019[62]. - The Carnegie 2 Mine has an estimated capacity to produce approximately 10,000 tons of coal per month, with operations having commenced in August 2022[63]. - The Bevins 1 Preparation Plant has a processing capacity of 800 tons per hour and a clean coal stockpile storage of 100,000 tons[64]. - The Bevins 2 Preparation Plant has a processing capacity of 500 tons per hour and a clean coal stockpile storage of 45,000 tons, currently utilizing less than 10% of its available processing capacity[65]. - The E4-2 mine has an estimated capacity to produce approximately 80,000 tons of coal per month[77]. - The Davidson Branch Preparation Plant has a processing capacity of 1,300 tons per hour, but currently utilizes less than 10% of this capacity[78]. - Wyoming County Coal has two idled underground mining permits and three permits associated with the idled Pioneer Preparation Plant, awaiting regulatory approval[75]. - The company has approximately 200 leases for coal mining and processing operations, with various mineral and surface owners[79]. - The allocated cost for the property at Deane Mining is $1,569,641, with the Mill Creek Preparation Plant operational and capable of processing coal[71]. - The allocated cost for the property at Wyoming County Coal is $22,326,101, with $22,091,688 paid in shares of Class A Common stock[74]. - The company holds 11 additional coal mining permits that are idled or in various stages of reclamation, with no current plans to bring them into production[67]. Financial Performance - Revenue for the three months ended June 30, 2024, was $4,095, a decrease of $1,996,594 compared to $2,000,689 for the same period in 2023[86]. - Operating expenses for the three months ended June 30, 2024, were $6,233,513, down by $3,116,969 from $9,350,482 in the prior year[86]. - Net loss from operations for the three months ended June 30, 2024, was $(6,229,418), an improvement of $1,120,375 compared to $(7,349,793) in 2023[86]. - The net loss for the six months ended June 30, 2024, was $(13,545,365), which is $2,861,525 higher than the net loss of $(10,683,840) for the same period in 2023[86]. - Total revenue for the three months ended June 30, 2024, decreased by $1,996,594, primarily due to a reduction of $1,675,815 in coal sales compared to 2023[88]. - Total operating expenses for the three months ended June 30, 2024, decreased by $3,116,969, with the cost of coal sales and processing dropping by $3,227,090[90]. - General and administrative expenses increased by $1,262,548 for the three months ended June 30, 2024, while development expenses decreased by $1,761,642[91]. - Total other expenses for the three months ended June 30, 2024, decreased by $99,889, with earnings from equity method investees improving by $413,859[93]. Cash Flow and Liquidity - As of June 30, 2024, available cash was $169,553,258, with expectations to fund liquidity requirements through cash on hand and future borrowings[94]. - Cash used in operating activities for the six months ended June 30, 2024, was $13,217,548, consisting of a net loss of $13,545,365[95]. - Cash used in investing activities for the six months ended June 30, 2024, was $248,796, primarily due to purchases of property and equipment[96]. - Cash provided by financing activities for the six months ended June 30, 2024, was $146,338,960, including proceeds from tax-exempt bonds of $149,719,203[96]. Internal Controls and Compliance - The Company's management concluded that its disclosure controls and procedures were not effective due to insufficient staff performing accounting and reporting functions and lack of timely reconciliations[101]. - There have been no changes in the Company's internal control over financial reporting during the period ended June 30, 2024, that have materially affected the Company's internal controls[102]. - The Company believes that the financial statements and other information presented are materially correct despite the identified control deficiencies[101]. - The design of the control system must consider resource constraints, and the benefits of controls must be weighed against their costs[101]. Legal and Regulatory Matters - The Company is subject to ordinary routine litigation incidental to its normal business operations[103].