American Resources(US:AREC)2025-11-14 22:01Mining Operations - The company has not mined or sold thermal coal since mid-2019, with all mining operations currently idled due to adverse market conditions [191]. - In 2023, the Carnegie 1 Mine produced approximately 67,000 tons of coal, selling at an average price of $180 per ton [194]. - The Carnegie 2 Mine produced approximately 13,000 tons of coal in 2023, with an average selling price of $237 per ton [195]. - The McCoy Elkhorn subsidiary has an estimated capacity to produce up to approximately 40,000 tons per month from Mine 15 when operational [193]. - The company holds 11 additional coal mining permits that are currently idled or in various stages of reclamation [200]. - Wyoming County Coal holds approximately 5,668,000 tons of coal deposits, with no current production [214]. - The E4-2 mine produced approximately 106,000 tons of coal in 2022, selling at an average price of $153 per ton [225]. - The Gold Star Mine is currently idled and has been mined in the past using room-and-pillar methods [233]. - ERC Mining Indiana Corporation holds approximately 4,383,298 tons of coal deposits in reclamation status [232]. Processing Facilities - The Bevins 1 Preparation Plant has a processing capacity of 800 tons per hour and can store approximately 100,000 tons of clean coal [196]. - The Mill Creek Preparation Plant has an 800 ton-per-hour processing capacity, currently utilizing less than 10% of its available capacity [211]. - The Supreme Energy Preparation Plant is a 400 ton-per-hour facility that is currently idled and would require capital investment to bring back into operation [206]. - The Davidson Branch Preparation Plant has a capacity of 1,300 tons per hour but is currently not operating due to idled mining operations [226]. Financial Performance - Total revenue for the three months ended September 30, 2025, was $50,165, a decrease of $185,278 (78.7%) compared to $235,443 in 2024, primarily due to the absence of revenue from metal recovery and sales [251]. - Total revenue for the nine months ended September 30, 2025, was $95,349, down $238,208 (71.4%) from $333,557 in 2024, mainly driven by a reduction of $146,055 in royalty income [254]. - Total operating expenses for the three months ended September 30, 2025, were $4,359,718, a decrease of $3,985,618 (47.8%) compared to $8,345,336 in 2024, largely due to lower general and administrative expenses [252]. - Total operating expenses for the nine months ended September 30, 2025, were $16,152,058, down $7,519,858 (31.7%) from $23,671,916 in 2024, primarily due to reduced coal production costs [256]. - Net loss for the three months ended September 30, 2025, was $6,302,798, a decrease of $2,614,084 (29.3%) compared to a net loss of $8,916,882 in 2024 [250]. - Net loss for the nine months ended September 30, 2025, was $21,620,830, down $5,424,925 (20.1%) from $27,045,755 in 2024 [250]. - Interest expense for the three months ended September 30, 2025, was $1,980,211, an increase of $1,003,750 (102.8%) compared to $976,461 in 2024 [253]. - Interest income for the nine months ended September 30, 2025, was $21,356, a decrease of $977,301 (97.9%) from $998,657 in 2024 [257]. Cash Flow and Liquidity - As of September 30, 2025, the company has a cash balance of $2,081,780 and a working deficit of $75,743,188 [259]. - Cash used in operating activities decreased by $6,864,631 to $(10,685,238) compared to the prior period, primarily due to a $5,424,925 decrease in net loss [260]. - Cash provided by investing activities was $3,930,735 for the nine months ended September 30, 2025, a significant improvement from cash used of $(145,900,141) in the same period of 2024 [261]. - Cash provided by financing activities decreased to $9,341,649 in 2025 from $145,065,317 in 2024, largely due to the absence of proceeds from tax-exempt bonds received in the prior year [262]. - The company does not have any credit lines currently available to fund liquidity requirements, which poses significant uncertainties for future liquidity [259]. Business Diversification - The company has established subsidiaries focused on the recovery and sale of metals and rare earth elements, diversifying its revenue streams [189]. - The company anticipates increasing revenues from its new ReElement and Electrified Materials businesses in 2025, following the suspension of coal production activities in 2023 [258]. - The company will continue to require cash flows from financing activities to support operations and the development of new business models [258]. Management and Internal Controls - Management concluded that disclosure controls and procedures were not effective due to insufficient staffing and lack of timely reconciliations [271]. - There have been no changes in the company's internal control over financial reporting that materially affected its controls during the period ended September 30, 2025 [273].