CONSOL Energy (US:CEIX)2025-08-05 11:16Part I. Financial Information Item 1. Financial Statements Unaudited consolidated financial statements for Core Natural Resources, Inc. for Q2 and H1 2025 and 2024 are presented, with detailed accompanying notes Consolidated Statements of (Loss) Income Q2 2025 net loss of $36.6 million, a downturn from Q2 2024's $58.1 million net income, was driven by increased post-merger costs | Financial Metric (in millions of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $1,102.4M | $490.7M | $2,119.8M | $1,037.4M | | (Loss) Income from Operations | ($19.3M) | $71.9M | ($73.2M) | $195.9M | | Net (Loss) Income | ($36.6M) | $58.1M | ($105.8M) | $160.0M | | Total Dilutive (Loss) Earnings per Share | ($0.70) | $1.96 | ($2.06) | $5.35 | | Dividends Declared per Common Share | $0.10 | $— | $0.20 | $— | Consolidated Balance Sheets Total assets grew substantially to $6.21 billion as of June 30, 2025, from $2.88 billion at December 31, 2024, driven by the Arch merger | Balance Sheet Item (in millions of USD) | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $1,272.1M | $786.0M | | Total Assets | $6,208.7M | $2,879.5M | | Total Current Liabilities | $713.8M | $518.7M | | Total Liabilities | $2,441.2M | $1,311.3M | | Total Equity | $3,767.6M | $1,568.2M | | Total Liabilities and Equity | $6,208.7M | $2,879.5M | Consolidated Statements of Cash Flows Net cash from operating activities decreased to $110.5 million for H1 2025, while investing activities became a source of $182.8 million due to the merger | Cash Flow Activity (Six Months Ended June 30, in millions of USD) | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $110.5M | $193.7M | | Net Cash Provided by (Used in) Investing Activities | $182.8M | ($95.5M) | | Net Cash Used in Financing Activities | ($134.0M) | ($84.7M) | | Net Increase in Cash and Cash Equivalents | $159.4M | $13.6M | Notes to Consolidated Financial Statements These notes detail the Arch Resources merger, segment restructuring, and debt refinancing, providing context for the financial results - On January 14, 2025, the company completed its merger of equals with Arch Resources, issuing 24.3 million shares of common stock for a total consideration of approximately $2.58 billion4045 - Post-merger, the company reorganized into four reportable segments: High CV Thermal, Metallurgical, Powder River Basin (PRB), and Baltimore Marine Terminal108 - In March 2025, the company refinanced existing debt by issuing new tax-exempt bonds, resulting in an $11.7 million loss on debt extinguishment for the six months ended June 30, 2025949597 Management's Discussion and Analysis of Financial Condition and Results of Operations This MD&A section details the financial impact of the Arch merger, recent operational developments, and performance across new business segments Recent Developments Key recent events include the Arch merger, a combustion incident at Leer South mine, and new legislation providing tax benefits for metallurgical coal - The merger with Arch was completed on January 14, 2025, leading to a restructuring into four new reportable segments: High CV Thermal, Metallurgical, Powder River Basin (PRB), and Baltimore Marine Terminal126127 - A combustion incident at the Leer South mine on January 13, 2025, temporarily halted production, with expected Q3 2025 costs of $20-$30 million and anticipated insurance recoveries exceeding $100 million128129 - The "One Big Beautiful Bill Act" (OBBBA), signed July 4, 2025, designates U.S.-produced metallurgical coal as a "critical material," qualifying for a 2.5% monetizable tax credit from 2026 through 2029130 Results of Operations Q2 2025 revenues increased to $1.1 billion due to the Arch merger, but a net loss was recorded from higher costs across the integrated company | Metric (in millions of USD) | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Revenues | $1,102.4M | $490.7M | +$611.7M | | Cost of Sales | $912.6M | $344.0M | +$568.6M | | DD&A | $169.0M | $55.0M | +$114.0M | | G&A Costs | $35.0M | $21.0M | +$14.0M | - The High CV Thermal segment's Adjusted EBITDA increased by $23 million in Q2 2025, driven by a 1.7 million ton increase in PAMC sales volumes despite lower price realization161 - The Metallurgical segment's Q2 2025 Adjusted EBITDA was negatively impacted by $21 million in costs from the Leer South mine incident and significantly lower metallurgical coal benchmark prices162 - The Baltimore Marine Terminal's Adjusted EBITDA increased to $15 million in Q2 2025 from $6 million in Q2 2024, as throughput volumes recovered to 4.9 million tons post-bridge collapse164 Liquidity and Capital Resources As of June 30, 2025, total liquidity was $948 million, supported by an upsized revolving credit facility and a new $1 billion share repurchase program | Liquidity Component (in millions of USD) | June 30, 2025 | | :--- | :--- | | Cash and Cash Equivalents | $413M | | Securitization Facilities - Current Availability | $188M | | Revolving Credit Facility - Current Availability | $600M | | Less: Letters of Credit Outstanding | ($253M) | | Total Liquidity | $948M | - In connection with the merger, the Revolving Credit Facility was amended to increase commitments from $355 million to $600 million and extend maturity to April 30, 2029183 - A new capital return framework approved in February 2025 authorizes up to $1 billion in share repurchases, with $183.2 million utilized in the first half of 2025216194 Item 3. Quantitative and Qualitative Disclosures About Market Risk The company reports no material changes to its market risk exposures since its 2024 Annual Report on Form 10-K - There have been no material changes to the Company's exposures to market risk since December 31, 2024226 Item 4. Controls and Procedures Management concluded that disclosure controls were effective as of June 30, 2025, excluding Arch's acquired operations from internal control assessment - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025227 - The acquired operations of Arch were excluded from the assessment of internal control over financial reporting, representing approximately 47% of Q2 2025 total revenues and 53% of total assets as of June 30, 2025228 Part II. Other Information Item 1. Legal Proceedings The company is not currently subject to any material litigation, except as referenced in Note 14 of the financial statements - The company is not currently subject to any material litigation, except as disclosed in Note 14 to the Consolidated Financial Statements231 Item 1A. Risk Factors This section highlights the potential adverse impact of new or existing tariffs and trade measures on the company's business and financial results - A key risk factor highlighted is the potential adverse impact of new or existing tariffs and other trade measures on the company's business, financial condition, and cash flows, particularly given the company's sales into export markets233 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company repurchased 1,175,905 shares for approximately $82 million during Q2 2025 under its $1 billion repurchase program | Period | Total Shares Purchased | Average Price Paid per Share (USD) | | :--- | :--- | :--- | | May 1 - May 31, 2025 | 547,777 | $70.02 | | June 1 - June 30, 2025 | 628,128 | $69.31 | - The company utilized approximately $82 million to repurchase shares of its common stock during the three months ended June 30, 2025235 - As of August 5, 2025, approximately $816 million remained available under the $1 billion stock repurchase program authorized on February 18, 2025234 Item 3. Defaults Upon Senior Securities The company reports no defaults upon senior securities - None237 Item 4. Mine Safety Disclosures Information regarding mine safety violations and other regulatory matters is included in Exhibit 95 to this quarterly report - Mine safety disclosures required by Section 1503(a) of the Dodd-Frank Act are provided in Exhibit 95 to the report238 Item 5. Other Information No directors or officers adopted or terminated a Rule 10b5-1 trading plan during the quarter ended June 30, 2025 - During the three months ended June 30, 2025, no director or officer of the Company adopted or terminated a Rule 10b5-1 trading arrangement239 Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including merger agreements, credit agreements, and officer certifications - Lists exhibits filed with the report, such as the Agreement and Plan of Merger, amendments to credit agreements, officer certifications pursuant to the Sarbanes-Oxley Act, and Mine Safety data241258