NACCO Industries(US:NC)2021-11-03 20:58Financial Performance - Total revenues for the three months ended September 30, 2021, were $51,742,000, representing a 60% increase from $32,295,000 in the same period of 2020[11] - Gross profit for the nine months ended September 30, 2021, was $31,006,000, up 97% from $15,741,000 in the prior year[11] - Net income for the three months ended September 30, 2021, was $24,837,000, compared to $8,022,000 for the same period in 2020, marking a 210% increase[11] - Basic earnings per share for the three months ended September 30, 2021, were $3.47, up from $1.14 in the same period of 2020[11] - Operating profit for the nine months ended September 30, 2021, was $44,592,000, compared to $21,460,000 in the prior year, reflecting a 108% increase[11] - Operating profit for the total company was $27.6 million in Q3 2021, compared to $9.4 million in Q3 2020, reflecting a 194% increase[73] - Total comprehensive income for the nine months ended September 30, 2021, was $40,732,000, compared to $20,593,000 for the same period in 2020, reflecting a 97% increase[13] Cash Flow and Assets - Cash and cash equivalents at the end of the period were $87,507,000, a decrease from $88,450,000 at the beginning of the period[15] - The company reported net cash provided by operating activities of $67,794,000 for the nine months ended September 30, 2021, significantly up from $2,760,000 in 2020[15] - Total assets increased to $488,918,000 as of September 30, 2021, compared to $476,179,000 as of December 31, 2020[10] - Total liabilities decreased to $147,999,000 from $175,555,000 over the same period[10] - The company had a total cash and cash equivalents balance of $87,507,000 at the end of the period, down from $97,567,000 at the beginning of the period[15] Segment Performance - Coal Mining segment revenues reached $23.7 million in Q3 2021, up 16% from $20.4 million in Q3 2020[73] - NAMining segment revenues increased to $17.7 million in Q3 2021, compared to $9.4 million in Q3 2020, representing an 87% growth[73] - Minerals Management segment revenues surged to $10.6 million in Q3 2021, a significant increase from $2.7 million in Q3 2020[73] - Operating profit for the Coal Mining segment increased to $23.121 million in Q3 2021 from $11.174 million in Q3 2020, a 107% increase[104] - Operating profit for the NAMining segment increased to $312,000 in Q3 2021, up from $244,000 in Q3 2020[137] - Operating profit for the Minerals Management segment rose to $9.454 million in Q3 2021, compared to $1.673 million in Q3 2020[140] Investments and Expenditures - The company made expenditures for property, plant, and equipment totaling $35,534,000 during the nine months ended September 30, 2021[15] - Capital expenditures for the Coal Mining segment were $5.6 million in Q3 2021, compared to $3.2 million in Q3 2020[73] - Expenditures for property, plant, and equipment and mineral interests were $35.5 million during the first nine months of 2021, with planned expenditures of approximately $24 million in the NAMining segment for 2022[116] - The company is evaluating additional investments in mineral and royalty interests of up to $15 million by the end of 2022[171] Contracts and Agreements - The termination fee received from NTEC for the contract mining agreement was $10.3 million, effective September 30, 2021[26] - The Coal Sales Agreement with Rainbow Energy will take effect upon the sale of Coal Creek Station, with Falkirk supplying all coal requirements thereafter[23] - A new Coal Sales Agreement will be effective upon the sale, with Falkirk supplying all coal requirements for Coal Creek Station, while Rainbow Energy will cover all mine operating costs[80] - If Rainbow Energy terminates the Coal Sales Agreement before 2027, Falkirk could receive additional payments ranging from $8 million to $2 million depending on the closure date[80] Future Outlook - The anticipated reduction in earnings at the unconsolidated Coal Mining operations is expected to be driven by the Bisti contract termination and reduced fees at Liberty[144] - Full-year 2021 coal deliveries are expected to be moderately lower than 2020, but operating profit is anticipated to increase due to mine reclamation income and reduced expenses[145] - In 2022, coal deliveries are expected to decrease due to the Bisti contract termination, leading to a significant decrease in operating profit compared to 2021[152][153] - The company expects unlevered after-tax returns on invested capital in the mid-teens as its contract mining business matures and scales[178] Regulatory and Market Environment - The political and regulatory environment poses challenges for expanding coal mining operations, limiting opportunities in the current market[182] - The Company continues to manage coal production costs and maximize efficiencies to support its customers amid fluctuating energy prices[181]