Performance was significantly impacted by Algoma's breach of contract, which necessitated the idling of the Haverhill 1 facility and shifted the sales mix toward lower-margin spot markets. Management successfully mitigated approximately $40,000,000 of the potential $70,000,000 working capital impact from the Algoma breach through third-party sales and facility turndowns. The acquisition of Phoenix Global is a key strategic pivot to diversify revenue streams, contributing five months of results in 2025 ...

We also made great progress on our capital allocation priorities in 2025 with the acquisition of Phoenix. potential in this business. The integration is progressing well, and we are excited for the growth In 2025, we also returned approximately $41,000,000 to our shareholders via our quarterly dividend. We expect to continue our quarterly dividend throughout 2026. With that, I will turn it over to Mark to review our fourth quarter and full year earnings in detail. Mark? Thanks, Katherine.The domestic coke s ...

Financial Data and Key Metrics Changes - The consolidated adjusted EBITDA for 2025 was $219.2 million, down $53.6 million from the prior year, primarily due to changes in contract and spot coke sales, lower economics on the Granite City contract extension, and lower handling volumes [5][10] - The fourth quarter net loss attributable to SunCoke was $1 per share, down $1.28 compared to Q4 2024, mainly driven by one-time items totaling $0.85 per share net of tax [8][9] - Full year net loss attributable to SunCoke was $0.52 per share, down $1.64 from 2024, influenced by one-time items including non-cash asset impairment charges [8][9] Business Line Data and Key Metrics Changes - The domestic coke business delivered full-year adjusted EBITDA of $170 million, down $64.7 million from the prior year, impacted by contract and spot coke sales mix and the Algoma breach [10] - The industrial services segment, including Phoenix Global, delivered full-year adjusted EBITDA of $62.3 million, an increase of $11.9 million year-over-year, primarily due to the addition of Phoenix Global [11] - Corporate and other expenses increased by $800,000 year-over-year to $13.1 million, reflecting results from legacy coal mining and Brazil coke-making businesses [11] Market Data and Key Metrics Changes - The domestic coke segment is expected to deliver adjusted EBITDA between $162 million and $168 million in 2026, with sales of approximately 3.4 million tons [16][18] - Industrial services adjusted EBITDA is projected to be between $90 million and $100 million in 2026, reflecting expectations for improved market conditions [19][20] Company Strategy and Development Direction - The company plans to utilize free cash flow to support capital allocation priorities, including paying down revolver balance and maintaining dividends [22][23] - The integration of Phoenix Global is progressing well, with expectations for growth potential in this business [7][23] - The company aims to maintain strong safety and environmental performance, which is central to delivering high-quality coke and industrial services [22] Management's Comments on Operating Environment and Future Outlook - Management anticipates a meaningful recovery in 2026, supported by an optimized coke fleet and extended coke-making contracts [15] - The company expects consolidated adjusted EBITDA to be between $230 million and $250 million in 2026, with a focus on deleveraging and maintaining a gross leverage target below 3x [15][21] - Management highlighted the impact of ongoing litigation with Algoma, expecting to recover losses from the breach of contract [28][30] Other Important Information - The company returned approximately $41 million to shareholders via dividends in 2025 and plans to continue this in 2026 [7] - Capital expenditures for 2025 were $66.8 million, slightly below the revised guidance of $70 million [13] Q&A Session Summary Question: Status of litigation with Algoma - Management confirmed they are pursuing arbitration against Algoma for breach of contract and expect to prevail [28][30] Question: EBITDA contribution from Phoenix Global - Management affirmed the anticipated annual EBITDA contribution from Phoenix Global is still expected to be around $60 million, with synergies of $5 million-$10 million [32] Question: Haverhill One closure and potential reopening - Management stated that Haverhill One could be restarted but would require significant capital investment and about 12-18 months [42] Question: Impact of Middletown turbine failure - Management indicated that the turbine failure will have a $10 million impact in the first quarter, with no earnings from power production until it is operational again [46][48] Question: Expected improvement in tons handled in the industrial segment - Management noted that guidance includes a full year of the new KRT contract and modest recovery across both KRT and CMT [52]

Financial Data and Key Metrics Changes - The consolidated adjusted EBITDA for Q4 2025 was $56.7 million, down $9.4 million compared to the prior year, primarily due to lower coke sales volumes and market conditions [9][10] - Full year adjusted EBITDA for 2025 was $219.2 million, a decrease of $53.6 million from the previous year, driven by changes in contract and spot coke sales and lower economics on the Granite City contract extension [9][10] - The net loss attributable to SunCoke for Q4 2025 was $1 per share, down from $1.28 in Q4 2024, influenced by one-time items totaling $0.85 per share [8][9] Business Line Data and Key Metrics Changes - The domestic coke business delivered full-year adjusted EBITDA of $170 million, down $64.7 million from the prior year, impacted by contract and spot coke sales mix and the Algoma breach [10][11] - The industrial services segment, including Phoenix Global, reported full-year adjusted EBITDA of $62.3 million, an increase of $11.9 million year-over-year, primarily due to the addition of Phoenix Global [11] - Corporate and other expenses increased by $800,000 year-over-year to $13.1 million, reflecting costs from legacy operations [11] Market Data and Key Metrics Changes - The domestic coke segment is expected to deliver adjusted EBITDA between $162 million and $168 million in 2026, with sales of approximately 3.4 million tons [17][19] - Industrial services adjusted EBITDA is projected to be between $90 million and $100 million in 2026, reflecting expectations for improved market conditions [20][22] Company Strategy and Development Direction - The company plans to utilize free cash flow to support capital allocation priorities, including paying down revolver balance and maintaining dividends [24][25] - SunCoke aims to continue integrating Phoenix Global and assess new growth opportunities across its business [25] - The company has extended key contracts, including the Granite City and Haverhill Two contracts, to ensure stable revenue streams [6][19] Management's Comments on Operating Environment and Future Outlook - Management anticipates a meaningful recovery in 2026, supported by an optimized coke fleet and improved market conditions [16][24] - The company expects to generate positive free cash flow in 2026, with gross leverage targeted around 2.45x, below the long-term target of 3x [16][24] - Management highlighted the impact of recent weather conditions and operational challenges, including a turbine failure, on first-quarter results [47][48] Other Important Information - The company returned approximately $41 million to shareholders via dividends in 2025 and plans to continue this practice in 2026 [6][24] - The integration of Phoenix Global is progressing well, with expected synergies contributing to future earnings [33][20] Q&A Session Summary Question: Status of litigation with Algoma regarding contract breach - Management confirmed ongoing arbitration with Algoma, expecting to recover losses from the breach, which could amount to up to $70 million [30][31] Question: Expected EBITDA contribution from Phoenix Global - Management affirmed the anticipated annual EBITDA contribution of approximately $60 million from Phoenix Global, along with expected synergies of $5 million to $10 million [33] Question: Future of Haverhill One facility - Management indicated that Haverhill One could be restarted but would require significant capital investment and is currently not economically viable [42][43] Question: Impact of Middletown turbine failure and weather on operations - Management noted that the turbine failure and severe weather have resulted in an estimated $10 million impact on first-quarter results [48][49] Question: Drivers of expected improvement in industrial segment handling volumes - Management attributed the expected improvement to a full year of the new KRT contract and modest recovery across both KRT and CMT [52]

Company Overview - SunCoke Energy, Inc. supplies high-quality coke for domestic and international customers, primarily used in steel production and foundry applications [2] - The company operates under long-term, take-or-pay contracts, ensuring stable revenue streams [2] - SunCoke utilizes innovative heat-recovery technology to enhance efficiency in its cokemaking process, leveraging over 60 years of industry experience [2] Operational Capacity - The company operates facilities in Illinois, Indiana, Ohio, Virginia, and Brazil, showcasing a diverse geographical presence [2] - SunCoke's logistics terminals have the capacity to mix and transload over 40 million tons of material annually, strategically located to serve key markets including the Gulf Coast, East Coast, Great Lakes, and international ports [2] Industrial Services - In addition to coke production, SunCoke provides industrial services such as material handling for coke, coal, steel, and power industries, as well as critical services for leading steel producers globally [2] - The company also offers services related to the removal, handling, and processing of molten slag, along with the preparation and transportation of metal scraps and raw materials [2]

Core Insights - SunCoke Energy, Inc. (NYSE:SXC) is identified as one of the best dividend stocks to buy, with an average price target suggesting a 47% upside potential [1] - B. Riley maintained a Neutral rating on SXC, reducing the price target from $11 to $10, while noting that SXC's adjusted EBITDA of $59.1 million exceeded market expectations [2] - The company has raised its Industrial Services EBITDA guidance for 2025 to a range of $63 million to $67 million, and adjusted EBITDA guidance to between $220 million and $224 million, driven by contributions from Phoenix and anticipated synergies [3] Company Developments - SunCoke Energy has extended its cokemaking agreement with Cleveland-Cliffs Inc. for three years, committing to supply 500,000 tons of metallurgical coke annually from its Haverhill plant starting January 1, 2026 [4] - The company operates in the United States and Brazil through its Domestic Coke, Brazil Coke, and Logistics segments [5]

Core Insights - The article discusses the potential resurgence of small-cap dividend stocks, highlighting their current undervaluation and the favorable economic conditions that may support their growth [2][5]. Economic Environment - Small-cap American stocks have been slow-moving, but expectations of interest rate cuts by the Fed could benefit these companies due to reduced borrowing costs [2][3]. - Goldman Sachs reports that American small-cap earnings are showing signs of recovery, with 25% of Russell 2000 members posting growing earnings for at least two consecutive quarters [4]. International Perspective - European small-caps are expected to experience robust growth, with higher market expectations compared to larger companies [5]. - Japanese small and mid-cap companies have outperformed large-caps, supported by solid earnings and strong local demand [5]. Valuation Metrics - US small-cap stocks are currently priced about 26% less than large caps, while international small caps are 8% cheaper, indicating potential undervaluation [5]. Investment Strategy - The article presents a list of the best small-cap dividend stocks to buy, focusing on those with significant hedge fund interest [6][9]. - The methodology for selecting these stocks involves using the Invesco S&P SmallCap High Dividend Low Volatility ETF and focusing on holdings with market caps between $300 million and $2 billion [9]. Company Highlights - **Sylvamo Corporation (NYSE:SLVM)**: - Market Cap: $1.967 billion, Dividend Yield: 3.69%, with a potential upside of 21% to 54% based on price targets [11][12]. - Recently upgraded by BofA, with a rights plan approved to protect shareholder value [12][13][14]. - **SunCoke Energy, Inc. (NYSE:SXC)**: - Market Cap: $575.726 million, Dividend Yield: 7.06%, with a suggested upside of 47% [16]. - Adjusted EBITDA guidance for 2025 raised to between $220 million and $224 million, driven by strong performance in Industrial Services [18]. - Extended a cokemaking deal with Cleveland-Cliffs Inc. for three years, starting January 1, 2026 [19].

Core Insights - SunCoke Energy, Inc. reported a Consolidated Adjusted EBITDA of $59.1 million for Q3 2025, which includes two months of results from the acquisition of Phoenix Global [2][4] - The company updated its full-year Consolidated Adjusted EBITDA guidance to a range of $220 million to $225 million, reflecting the addition of Phoenix Global results and a deferral of approximately 200,000 tons of coke sales due to a breach of contract by a customer [2][4][17] Financial Performance - Revenues for Q3 2025 were $487.0 million, a decrease of $3.1 million compared to $490.1 million in Q3 2024 [3][5] - Net income attributable to SunCoke was $22.2 million, down from $30.7 million in the prior year, translating to $0.26 per diluted share compared to $0.36 [4][6] - Adjusted EBITDA decreased by $16.2 million from $75.3 million in Q3 2024 to $59.1 million in Q3 2025, primarily due to lower volumes and pricing [7][4] Segment Results - Domestic Coke segment revenues decreased by $46.1 million to $413.8 million, driven by lower pricing and volumes due to a change in the mix of contract and spot coke sales [9][10] - Adjusted EBITDA for the Domestic Coke segment fell by $14.1 million to $44.0 million, impacted by lower volumes and pricing [11] - The Industrial Services segment saw revenues increase by $42.7 million to $64.1 million, primarily due to the addition of Phoenix Global results [13][14] Acquisition and Integration - The acquisition of Phoenix Global was completed on August 1, 2025, for $325 million, funded through cash on hand and revolving credit [44] - The integration of Phoenix Global is progressing well, with expectations to begin realizing synergies from the acquisition in 2026 [2][4] Revised Outlook - The revised guidance for 2025 includes an expected Consolidated Net Income between $48 million and $58 million, with capital expenditures projected at approximately $70 million [20][17] - Operating cash flow is estimated to be between $62 million and $72 million for 2025 [20]

Core Insights - SunCoke Energy reported mixed results for Q2 2025, with revenue exceeding expectations but earnings per share and profitability falling short of forecasts [1][5][14] - The company is facing persistent headwinds in core operating results despite strategic advancements such as the Phoenix Global acquisition [1][13] Financial Performance - Q2 2025 GAAP EPS was $0.02, missing the estimate of $0.17, and down 92% from $0.25 in Q2 2024 [2] - Revenue for Q2 2025 was $434.1 million, surpassing the estimate of $348.05 million but down 7.8% from $470.9 million in Q2 2024 [2] - Adjusted EBITDA decreased by 31.3% year-over-year to $43.6 million [2] - Net income attributable to SunCoke was $1.9 million, a 91.2% decrease from $21.5 million in the prior year [2] Business Overview - SunCoke Energy primarily produces coke, essential for steelmaking, and operates a logistics segment for raw materials and finished coke [3] - The company relies on long-term, take-or-pay contracts with major steel producers, ensuring stable cash flow [4][9] Segment Performance - Domestic Coke segment revenue fell by 7% year-over-year, with adjusted EBITDA down 30% [6] - Logistics segment revenue dropped by 25.2% compared to the prior year, with adjusted EBITDA down 36.9% [7] - Brazil Coke operations remained stable with no significant year-over-year changes [8] Strategic Developments - The acquisition of Phoenix Global for $325 million is expected to enhance earnings and broaden the customer base, although it incurred upfront transaction costs [13] - The company extended its revolving credit facility to July 2030, improving liquidity [13] Future Outlook - Management reaffirmed full-year 2025 guidance for Adjusted EBITDA between $210 million and $225 million [14] - Domestic Coke production is projected at approximately 4.0 million tons in 2025, with operating cash flow expected between $165 million and $180 million [14]

Financial Data and Key Metrics Changes - SunCoke Energy reported consolidated adjusted EBITDA of $43.6 million for Q2 2025, a decrease from $63.5 million in the prior year period, primarily due to lower contract coke sales and unfavorable economics from the Granite City contract extension [4][12] - Net income attributable to SunCoke was $0.02 per share, down $0.23 compared to the prior year, impacted by lower contract coke sales and transaction costs related to the acquisition of Phoenix Global [11][12] - The company ended Q2 with a strong liquidity position of $536.2 million, including a cash balance of $186.2 million and a fully undrawn revolver of $350 million [5][14] Business Line Data and Key Metrics Changes - Domestic coke adjusted EBITDA for Q2 was $40.5 million, with coke sales volumes at 943,000 tons, reflecting a decrease due to a change in the mix of contract and spot coke sales [12][13] - The logistics business generated $7.7 million of adjusted EBITDA, with terminals handling combined throughput volumes of 4.8 million tons, also impacted by lower transloading volumes due to market conditions [13][14] Market Data and Key Metrics Changes - The company expects higher contract coke sales in the second half of the year, reaffirming its domestic coke adjusted EBITDA guidance range of $185 million to $192 million [13] - Logistics adjusted EBITDA guidance for the full year remains at $45 million to $50 million, with expectations of improved volumes in the second half [14][18] Company Strategy and Development Direction - The acquisition of Phoenix Global for $325 million is seen as a strategic fit, expected to be immediately accretive and providing opportunities for organic growth through new industrial customers [5][6][10] - The company aims to integrate Phoenix's operations into a new Industrial Services segment, leveraging its strong financial position and operational excellence [10][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about improvements in both logistics and domestic coke in the second half of the year, reaffirming full-year consolidated adjusted EBITDA guidance of $210 million to $225 million [18] - The company is focused on maintaining operational discipline and capital allocation to reward long-term shareholders while integrating Phoenix's operations [17][18] Other Important Information - The company amended and extended its revolving credit facility, now maturing in July 2030, with covenants similar to the previous agreement [5][14] - The acquisition is expected to generate annual synergies of approximately $5 million to $10 million [6] Q&A Session Summary Question: Can you walk us through the drivers of the improvement from here? - Management indicated that the second quarter was expected to be the trough of 2025, with higher contract coke sales anticipated in the second half, aiming for a total of 2 million to 2.1 million tons of coke sales [20][21] Question: Can you talk about the macro drivers of Phoenix Global? - Management highlighted excitement about the EAF exposure from Phoenix, which diversifies the customer base and presents opportunities for organic growth [23][25] Question: What are the recent conversations with your largest customer regarding contract renewals? - Management confirmed active discussions with Cliffs regarding contract renewals, noting that they were surprised by comments made during Cliffs' earnings call [27][28] Question: How do you view the logistics business and export coal demand? - Management acknowledged that the majority of volumes at CMT are coal for export, with higher domestic pricing impacting international shipments, but reaffirmed logistics guidance based on expected volumes [39][40] Question: Any updates on the GPI project? - Management stated they are in active discussions with U.S. Steel regarding the GPI project but had no further details to share at this time [47]