Core Insights - SouthGobi Resources Ltd. has announced its financial and operational results for the three and nine months ended September 30, 2025 [1] Financial Performance - The company reported its financial results for the third quarter and year-to-date, indicating key metrics that reflect its operational efficiency and market position [1] Operational Highlights - The operational results provide insights into production levels, sales volumes, and any significant changes in operational strategy or market conditions affecting the company [1]

Group 1: Coal, Oil, and Natural Gas Production - In October, the production of raw coal remained at a high level, with an output of 410 million tons, a year-on-year decrease of 2.3%, and an average daily output of 13.12 million tons. From January to October, the total output was 3.97 billion tons, reflecting a year-on-year increase of 1.5% [1] - Crude oil production continued to grow, reaching 18 million tons in October, a year-on-year increase of 1.3%, with a daily average of 581,000 tons. For the first ten months, the total crude oil output was 180.64 million tons, up 1.7% year-on-year [3] - Natural gas production saw a slowdown in growth, with October output at 22.1 billion cubic meters, a year-on-year increase of 5.9%, and a daily average of 710 million cubic meters. From January to October, the total output was 217 billion cubic meters, up 6.3% year-on-year [7] Group 2: Electricity Production - Electricity production in the industrial sector accelerated in October, with a total generation of 800.2 billion kilowatt-hours, a year-on-year increase of 7.9%, and a daily average of 25.81 billion kilowatt-hours. For the first ten months, the total electricity generation was 8,062.5 billion kilowatt-hours, reflecting a year-on-year increase of 2.3% [9] - By type, thermal power generation turned from decline to growth, with a year-on-year increase of 7.3% in October, compared to a decrease of 5.4% in September. Hydropower generation increased by 28.2%, although the growth rate slowed by 3.7 percentage points from September. Nuclear power generation grew by 4.2%, accelerating by 2.6 percentage points from September. Wind power saw a decline of 11.9%, with the decline rate expanding by 4.3 percentage points, while solar power generation increased by 5.9%, but the growth rate slowed by 15.2 percentage points from September [9]

Group 1: Coal, Oil, and Natural Gas Production - In October, the industrial raw coal production remained at a high level with an output of 410 million tons, a year-on-year decrease of 2.3%, and an average daily output of 13.12 million tons [1] - From January to October, the industrial raw coal output reached 3.97 billion tons, showing a year-on-year increase of 1.5% [2] - The industrial crude oil production in October was 18 million tons, reflecting a year-on-year growth of 1.3%, with a daily average output of 581,000 tons [2] - The industrial natural gas production in October was 22.1 billion cubic meters, with a year-on-year increase of 5.9%, although the growth rate slowed by 3.5 percentage points compared to September [3][4] Group 2: Oil Processing and Natural Gas Production - The industrial crude oil processing volume in October was 63.43 million tons, a year-on-year increase of 6.4%, with a daily average processing of 2.046 million tons [3] - From January to October, the industrial crude oil processing volume totaled 614.24 million tons, marking a year-on-year increase of 4.0% [3] - The total industrial natural gas output from January to October was 217 billion cubic meters, reflecting a year-on-year growth of 6.3% [4] Group 3: Electricity Production - The industrial electricity production in October reached 800.2 billion kilowatt-hours, a year-on-year increase of 7.9%, with a daily average generation of 25.81 billion kilowatt-hours [5] - From January to October, the total industrial electricity production was 8,062.5 billion kilowatt-hours, showing a year-on-year increase of 2.3% [5] - In October, the industrial thermal power generation turned from decline to growth with a year-on-year increase of 7.3%, while hydroelectric power grew by 28.2%, nuclear power increased by 4.2%, wind power saw a decline of 11.9%, and solar power grew by 5.9% [5]

Financial Data and Key Metrics Changes - Revenue increased by 40% year-over-year to $146.8 million for Q3 2025, compared to $105.2 million in the prior year period [14] - Net income surged to $23.9 million, a significant increase from $1.6 million in the prior year [15] - Adjusted EBITDA rose 1.6 times to $24.9 million, compared to $9.6 million in the prior year [15] - Operating cash flow improved to $23.2 million, up from cash used of $12.9 million in the prior year [15] Business Line Data and Key Metrics Changes - Electric sales increased by 29% to $93.2 million, compared to $72.1 million in the prior year [14] - Coal sales rose by 42% to $68.8 million, compared to $48.3 million in the prior year [14] - Hallador Power delivered 1.6 million megawatt-hours at an average sales price of $49.29 per megawatt-hour, compared to 1.2 million megawatt-hours at $47.55 per megawatt-hour in the same period in 2024 [10] Market Data and Key Metrics Changes - The favorable energy pricing environment was driven by higher energy demand and elevated natural gas prices, leading to a 29% year-over-year revenue increase for Hallador Power [5] - The company expects to produce approximately 3.8 million tons of coal in 2025, having produced 3.1 million tons through the first nine months [11] Company Strategy and Development Direction - The company submitted an application to the MISO ERIS program to add 525 megawatts of gas generation at the Merom site, aiming to grow its generation portfolio [5] - Hallador is evaluating strategic opportunities to acquire additional dispatchable generation assets to diversify its portfolio and enhance growth [9] - The company is transitioning from a commodity-focused coal producer to a vertically integrated independent power producer, leveraging the energy transition to capture expanding margins in power markets [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong market signals for their product offerings and the potential for long-term arrangements [4] - The company anticipates Q4 2025 to resemble Q4 2024 unless extreme weather conditions occur [23] - Management highlighted the structural imbalance in the energy market due to the retirement of dispatchable generators, which increases the value of reliable baseload generation [8] Other Important Information - Total forward energy and capacity sales position was $571.7 million as of September 30, 2025, down from $685.7 million at the end of 2024 [16] - The company executed a $20 million prepaid forward power sales contract, with delivery scheduled through the first half of 2027 [6] Q&A Session Summary Question: What are the main milestones for the capacity expansion? - Management indicated that the MISO expedited process will determine the timeline for application review, with updates provided in quarterly filings [21][22] Question: How has Q4 started compared to Q3? - Management noted that Q4 is expected to be less exceptional than Q3, with no significant catalysts anticipated [23] Question: What are the economics of the 525 MW expansion? - Management is still negotiating equipment and will provide updates as the project progresses [28] Question: What impact will the recent government funding for coal have? - Management believes Hallador could qualify for some of the funding, but details are still being navigated [30] Question: Are there any M&A opportunities being pursued? - Management is focused on coal assets, with ongoing discussions that may lead to future acquisitions [37] Question: What is the status of negotiations with potential customers? - Management confirmed active negotiations with multiple parties, including utilities and data center developers, with increased interest noted [44]

Financial Data and Key Metrics Changes - Revenue increased by 40% year-over-year to $146.8 million compared to $105.2 million in the prior-year period [14] - Net income surged to $23.9 million, a significant increase from $1.6 million in the prior-year period [15] - Adjusted EBITDA rose 1.6 times to $24.9 million from $9.6 million in the prior-year period [15] - Operating cash flow improved to $23.2 million from cash used of $12.9 million in the prior-year period [15] Business Line Data and Key Metrics Changes - Electric sales increased by 29% to $93.2 million compared to $72.1 million in the prior-year period, driven by favorable weather and higher energy demand [14] - Coal sales rose by 42% to $68.8 million from $48.3 million in the prior-year period, supported by increased shipments and favorable power markets [14] Market Data and Key Metrics Changes - The Hallador Power subsidiary experienced a more than 29% year-over-year revenue increase due to favorable summer weather and elevated natural gas prices [5] - The company expects to produce approximately 3.8 million tons of coal in 2025, having produced 3.1 million tons through the first nine months [11] Company Strategy and Development Direction - The company submitted an application to the MISO ERIS program to add 525 MW of gas generation at the Merom site, marking a strategic step to grow its generation portfolio [5] - Hallador is transitioning from a commodity-focused coal producer to a vertically integrated independent power producer, leveraging the energy transition to capture expanding margins in power markets [11] - The company is evaluating strategic opportunities to acquire additional dispatchable generation assets to diversify its portfolio and enhance growth [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong market signals for their product offerings and the potential for long-term agreements with data center developers and load-serving entities [7] - The evolving energy landscape, characterized by the retirement of dispatchable generators in favor of renewables, is creating opportunities for reliable baseload generation [8] - Management does not expect Q4 performance to match the exceptional results of Q3, anticipating a return to more typical conditions unless extreme weather occurs [22] Other Important Information - The company executed a $20 million prepaid forward power sales contract, which is a key component of its commercial strategy [6] - Total forward energy and capacity sales position was $571.7 million as of September 30, 2025, down from $685.7 million at the end of 2024 [16] Q&A Session Summary Question: What are the main milestones for the potential capacity expansion? - Management indicated that the MISO expedited process will determine the timeline for reviewing their application, with updates expected in the coming months [20][21] Question: How has Q4 started compared to Q3? - Management noted that Q4 is expected to resemble Q4 of 2024, with no significant catalysts anticipated to drive performance like Q3 [22] Question: Can you provide initial economics on the 525 MW expansion? - Management is still negotiating equipment and has not released detailed economics but is encouraged by market signals indicating a need for more capacity [27][28] Question: What impact might the recent government funding for coal have? - Management believes that government funding could be beneficial for the industry and that Hallador may have qualifying projects [30] Question: Are you seeing opportunities for M&A in the coal space? - Management expressed a preference for coal-related acquisitions, noting that such transactions are bespoke and take time to develop [37] Question: What is the status of discussions with potential customers? - Management confirmed ongoing negotiations with multiple parties, including utilities and data center developers, with increased interest noted [43][44]

Financial Data and Key Metrics Changes - Revenue increased by 40% year-over-year to $146.8 million for Q3 2025, compared to $105.2 million in the prior year period [15] - Net income surged to $23.9 million, a 14-fold increase from $1.6 million in the prior year [16] - Adjusted EBITDA rose 1.6 times to $24.9 million, compared to $9.6 million in the prior year [16] - Operating cash flow improved to $23.2 million, up from cash used of $12.9 million in the prior year [16] Business Line Data and Key Metrics Changes - Electric sales increased by 29% to $93.2 million, compared to $72.1 million in the prior year [14] - Coal sales rose by 42% to $68.8 million, compared to $48.3 million in the prior year [14] - Hallador Power delivered 1.6 million megawatt-hours at an average sales price of $49.29 per megawatt-hour, compared to 1.2 million megawatt-hours at $47.55 per megawatt-hour in the same period last year [11] Market Data and Key Metrics Changes - The favorable energy pricing environment was driven by traditional summer weather patterns, increased energy demand, and higher natural gas prices [14] - The company expects to produce approximately 3.8 million tons of coal in 2025, having produced 3.1 million tons through the first nine months [12] Company Strategy and Development Direction - The company submitted an application to the MISO ERIS program to add 525 megawatts of gas generation at the Merom site, indicating a strategic move to grow its generation portfolio [5] - Hallador is evaluating strategic opportunities to acquire additional dispatchable generation assets and infrastructure to diversify its portfolio and enhance growth [10] - The company is transitioning from a commodity-focused coal producer to a vertically integrated independent power producer, leveraging the energy transition to capture expanding margins in power markets [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong market signals for their product offerings and the potential for long-term arrangements [4] - The evolving energy landscape, characterized by the retirement of dispatchable generators in favor of renewables, is creating opportunities for reliable baseload generation [9] - Management does not expect Q4 2025 to replicate the exceptional performance of Q3, anticipating it will resemble Q4 2024 unless extreme weather conditions occur [24] Other Important Information - The company executed a $20 million prepaid forward power sales contract, with delivery scheduled through the first half of 2027, which is a key component of its commercial strategy [6] - Total forward energy and capacity sales position was $571.7 million as of September 30, 2025, down from $685.7 million at the end of 2024 [17] Q&A Session Summary Question: What are the main milestones for the capacity expansion? - Management indicated that the MISO expedited process will review their application, with updates expected in the coming months [21][22] Question: How has Q4 started compared to Q3? - Management noted that Q4 is expected to look similar to Q4 of 2024, with no significant catalysts anticipated to drive performance like Q3 [24] Question: What are the economics of the 525 MW expansion? - Management is still negotiating equipment and has not released specific economic details yet, but they are encouraged by market signals [29][30] Question: What impact will the recent government funding for coal have? - Management believes that government funding could be beneficial for the industry and that Hallador may qualify for some projects [31] Question: Are there any M&A opportunities being pursued? - Management stated they are primarily focused on the coal space and are encouraged by ongoing conversations regarding potential acquisitions [38][39] Question: What is the status of discussions with potential customers? - Management confirmed they are in advanced discussions with multiple parties, including utilities and data center developers, to secure agreements [45][46]

Financial Data and Key Metrics Changes - The company reported a net income of $32 million, or $0.61 per diluted share, and adjusted EBITDA of $141 million for Q3 2025 [15] - Free cash flow generation was $39 million, with operating cash flow impacted by negative working capital changes of $52 million [15][16] - Total liquidity at the end of Q3 was $995 million, an increase of $47 million compared to Q2 [16] Business Line Data and Key Metrics Changes - High-CV thermal segment coal production was 7.6 million tons in Q3 2025, down from 8 million tons in Q2 2025, with realized coal revenue of $59.78 per ton and cash cost of $40.53 per ton [5] - Metallurgical segment coal production was 2.3 million tons, down from 2.4 million tons in Q2 2025, with realized coke and coal revenue of $112.94 per ton and cash costs of $94.18 per ton [6] - Powder River Basin (PRB) segment coal production increased to 12.9 million tons, with realized coal revenue of $14.09 per ton and cash cost of $13.04 per ton [8] Market Data and Key Metrics Changes - U.S. power demand remained robust, with coal-fired generation increasing by approximately 12% year-to-date [17] - The PJM RTO market saw a 16% increase in coal-fired generation year-to-date [17] - Internationally, cement demand in India is expected to grow approximately 50% by 2030 compared to 2024 levels [19] Company Strategy and Development Direction - The company is focusing on the recovery and repositioning of long-haul equipment at the Lyr-South mine and exploring the presence of rare earth elements and critical minerals in its operations [4][10] - A measured approach to shareholder returns is being maintained, targeting around 75% of free cash flow for share buybacks and dividends [9] - The company aims to fill out its sales book for 2026 and beyond, having layered in nearly 26 million tons of forward contracts [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in overcoming operational challenges and highlighted the potential for improved productivity at the West Elk mine due to transitioning to a thicker coal seam [13] - The company anticipates a performance step change in 2026 due to low-cost asset base and advanced logistics network [13] - Management remains optimistic about the long-term fundamentals of the metallurgical segment despite current pressures on global steel prices [19] Other Important Information - The company returned over 60% of Q3 2025 free cash flow to shareholders, deploying $19 million for share repurchases and $5 million for dividends [9] - The board declared a $0.10 per share dividend payable on December 15th to stockholders of record on November 28th [9] Q&A Session Summary Question: Update on West Elk mine and methane levels - Management confirmed that methane issues have been managed and production is expected to resume soon, with confidence in the future performance of the West Elk mine [29][30] Question: Breakdown of high CV coal for 2026 - The company has 17 million tons of committed high CV coal for 2026, with 14 million tons from PAMC and 3 million tons from West Elk, pricing in the upper 50s [31][32] Question: Insurance proceeds and business interruption claims - Management indicated that total costs related to fire and idling are approaching $100 million, with optimism about the overall insurance claim [37] Question: Confidence in maintaining low costs at PAMC - Management expressed confidence in maintaining low costs at PAMC and improving costs at West Elk as operations stabilize [42][44] Question: Rare earth elements and government involvement - The company is evaluating the potential for recovering rare earth elements and critical minerals, leveraging its scale and existing operations [54][56] Question: Domestic thermal market capacity factors - Management noted that domestic coal-fired generation could increase by 20-30%, driven by investments in coal fleet and data center demand [59][60]

Financial Performance - Core reported net income of $31.6 million, or $0.61 per diluted share, and adjusted EBITDA of $141.2 million in Q3 2025, which included $18.4 million of fire extinguishment and idle mine cash costs at Leer South and a $19.4 million initial recovery of insurance proceeds related to the Leer South combustion-related event[6] - The company generated net cash provided by operating activities of $87.9 million and free cash flow of $38.9 million[6] - Core increased cash and cash equivalents by $31.5 million and overall liquidity by $47.5 million[6] Capital Return Program - Core returned $24.6 million to stockholders via share repurchases and quarterly dividends in Q3 2025, increasing the year-to-date capital return total to $218.3 million[6] - Since February 20, 2025, Core has reduced shares outstanding by approximately 5.2%[19] - As of September 30, 2025, Core had $797.4 million of remaining authorization under its existing $1.0 billion share repurchase program[22] Operational Highlights - The company achieved a strong production and sales volume performance at the Pennsylvania Mining Complex[6] - Core transitioned to a more advantageous reserve area at the West Elk mine[6] - The company raised PRB volume guidance again, taking advantage of improving domestic coal generation[6] - Core signed commitments across all segments and all periods totaling nearly 26 million tons[6] - In 2024, the company's sales volume was 85 million tons and revenue was $4.6 billion[7] Market Position and Strategy - The company has a 35% interest in Dominion Terminal Associates ("DTA")[13] - The company has 27 Mtpa export capacity via ownership interests in two marine terminals[13] - The high calorific value thermal segment has a committed book of ~17 million tons and the Powder River Basin segment has a committed book of business of ~40 million tons for delivery in 2026[28]

Core Insights - Warrior Met Coal, Inc. demonstrated strong financial performance in Q3 2025, showcasing operational excellence and strategic investments, particularly with the early startup of Blue Creek longwall operations [1][5][11] - The company raised its production guidance for 2025 by approximately 10% due to the increased output from Blue Creek, now expected to produce 1,800,000 short tons of High Vol A steelmaking coal, an 80% increase over initial guidance [5][11][39] - Despite weak steelmaking coal market conditions, the company achieved record quarterly sales volume of 2,400,000 short tons, a 27% increase compared to the same quarter last year [18][28] Financial Performance - Warrior Met Coal reported net income of $37 million or $0.70 per diluted share in Q3 2025, down from $42 million or $0.80 per diluted share in Q3 2024 [28] - Adjusted EBITDA for the quarter was $71 million, a decrease from $78 million in the same quarter last year, with an adjusted EBITDA margin of 22% [28][25] - Total revenues were $329 million, slightly up from $328 million in the same quarter last year, driven by a 27% increase in sales volume [30] Operational Highlights - The Blue Creek mine is designed for over 6,000,000 short tons of annual production and aims to be the lowest cost mine globally [9] - Capital expenditures for the Blue Creek project totaled $171 million year-to-date, with $64 million spent in Q3 2025, keeping the project on budget [9][37] - The company successfully won a federal coal lease sale for 58,000,000 short tons of high-quality steelmaking coal reserves, which will enhance its reserve base and extend the life of its operations [12][6] Market Conditions - The steelmaking coal market faced challenges from increased Chinese steel exports and subdued global demand, with a 10% rise in Chinese steel exports compared to the previous year [14][15] - The average price for the PLB FOB Australia index remained stable at $166 per short ton, while the PLB CFR China index averaged $162 per short ton, showing recovery from earlier lows [21][22] - The company expects continued pressure on steelmaking coal prices due to oversupply and trade tensions, but anticipates potential long-term recovery in demand from Europe [16][40] Strategic Outlook - The company is focused on ramping up longwall production and optimizing infrastructure performance at Blue Creek, with completion expected by the end of Q1 2026 [10] - Warrior Met Coal aims to maintain a disciplined approach to capital allocation, with plans for potential dividends and stock buybacks as free cash flow increases [44] - The successful early startup of Blue Creek and strategic reserve acquisition are expected to significantly enhance the company's long-term growth strategy [42]

Business Overview - Alpha sold 171 million tons of coal in 2024, with 76% for export and 24% for domestic markets[11] - Adjusted EBITDA in 2024 was $408 million[11] - The company has a diverse sales mix, including 37% High Vol-A, 31% High Vol-B, 19% Mid Vol, and 13% Low Vol[11] Production and Reserves - Total production in 2024 was 157 million tons, and total reserves as of year-end 2024 were 299 million tons[18] - Marfork complex accounted for 31% of total reserves, while McClure / Toms Creek accounted for 22%[18] Financial Performance - In 2024, the average realized price was $143 per ton[61] - Free cash flow in 2024 was $349 million[62] Capital Expenditures - Planned capital expenditures for 2025 are approximately $140 million, including $98 million for maintenance, $32 million for development projects, and $10 million carryover[64] Safety and Environment - The company has a ~24% lower Total Reportable Incident Rate vs Industry Avg[16] - The company has a ~50% Lower Non-Fatal Days Lost vs Industry Avg[16] Market Outlook - Global finished steel demand is expected to grow by ~40Mt or ~26% from 2029E to 2034E[27]