Yes .
___________________________________________________FORM 10-Q___________________________________________________For the quarterly period ended June 30, 2022OR☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934______________________________________________________________________________________________________Delaware83-1780608(State or other jurisdiction ofincorporation or organization)(I.R.S. EmployerIdentification No.)Level 33, Central Plaza One, 345 Queen StreetBrisbane, Queensland, Australia4000(Address of principal executive offices)(Zip Code)(61) ___________________________________________________Title of each classTrading Symbol(s)Name of each exchange on which registeredNoneNoneNone (or(or for such shorterperiod that the registrantwas required to filesuch reports), and (2) has has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).Yes ☒ No ☐Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer, a non-acceleratednon-accelerated filer, a smaller reporting “large “largeacceleratedfiler,” “accelerated “acceleratedfiler,” “smaller “smallerreportingLarge accelerated filer☐Accelerated filer☒Non-accelerated filer☐Smaller reporting company☐Emerging growth company☐ JulyOctober 31,2022, includingshares ofcommon stockunderlying 167,645,373.
i
Consolidated
BalanceSheetsas ofSeptember30,2022 andDecemberPART I – FINANCIAL INFORMATION
Coronado Global Resources Inc.
Unaudited Condensed Consolidated Statements ofOperations and Comprehensive Income
|
|
|
| Three months ended |
| Six months ended | ||||||||
|
| Note |
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Coal revenues |
|
|
| $ | 1,020,997 |
| $ | 384,470 |
| $ | 1,957,625 |
| $ | 683,631 |
Coal revenues from related parties |
|
|
|
| 0 |
|
| 29,294 |
|
| 0 |
|
| 97,335 |
Other revenues |
|
|
|
| 11,707 |
|
| 10,492 |
|
| 22,204 |
|
| 19,401 |
Total revenues |
| 3 |
|
| 1,032,704 |
|
| 424,256 |
|
| 1,979,829 |
|
| 800,367 |
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of coal revenues (exclusive of items shown separately below) |
|
|
|
| 397,463 |
|
| 306,155 |
|
| 754,963 |
|
| 580,258 |
Depreciation, depletion and amortization |
|
|
|
| 51,384 |
|
| 41,212 |
|
| 89,393 |
|
| 94,293 |
Freight expenses |
|
|
|
| 67,026 |
|
| 55,906 |
|
| 126,290 |
|
| 108,047 |
Stanwell rebate |
|
|
|
| 40,532 |
|
| 15,076 |
|
| 69,585 |
|
| 30,895 |
Other royalties |
|
|
|
| 79,348 |
|
| 23,173 |
|
| 162,380 |
|
| 44,120 |
Selling, general, and administrative expenses |
|
|
|
| 10,376 |
|
| 7,431 |
|
| 18,252 |
|
| 13,206 |
Restructuring costs |
|
|
|
| 0 |
|
| 2,300 |
|
| 0 |
|
| 2,300 |
Total costs and expenses |
|
|
|
| 646,129 |
|
| 451,253 |
|
| 1,220,863 |
|
| 873,119 |
Other (expense) income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
|
| (17,482) |
|
| (16,596) |
|
| (34,814) |
|
| (31,731) |
Loss on debt extinguishment |
|
|
|
| 0 |
|
| (5,744) |
|
| 0 |
|
| (5,744) |
(Increase) decrease in provision for discounting and credit losses |
|
|
|
| (156) |
|
| 1,866 |
|
| (584) |
|
| 5,644 |
Other, net |
|
|
|
| 25,083 |
|
| 570 |
|
| 22,293 |
|
| (2,358) |
Total other income (expense), net |
|
|
|
| 7,445 |
|
| (19,904) |
|
| (13,105) |
|
| (34,189) |
Income (loss) before tax |
|
|
|
| 394,020 |
|
| (46,901) |
|
| 745,861 |
|
| (106,941) |
Income tax (expense) benefit |
| 9 |
|
| (102,025) |
|
| (8,184) |
|
| (183,968) |
|
| 10,884 |
Net income (loss) |
|
|
|
| 291,995 |
|
| (55,085) |
|
| 561,893 |
|
| (96,057) |
Less: Net loss attributable to noncontrolling interest |
|
|
|
| 0 |
|
| 0 |
|
| 0 |
|
| (2) |
Net income (loss) attributable to Coronado Global Resources Inc. |
|
|
| $ | 291,995 |
| $ | (55,085) |
| $ | 561,893 |
| $ | (96,055) |
Other comprehensive income, net of income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustment |
| 12 |
|
| (50,168) |
|
| (4,221) |
|
| (33,910) |
|
| (8,830) |
Net gain on cash flow hedges, net of tax |
|
|
|
| 0 |
|
| 1,323 |
|
| 0 |
|
| 6,249 |
Total other comprehensive loss |
|
|
|
| (50,168) |
|
| (2,898) |
|
| (33,910) |
|
| (2,581) |
Total comprehensive income (loss) |
|
|
|
| 241,827 |
|
| (57,983) |
|
| 527,983 |
|
| (98,638) |
Less: Net loss attributable to noncontrolling interest |
|
|
|
| 0 |
|
| 0 |
|
| 0 |
|
| (2) |
Total comprehensive income (loss) attributable to Coronado Global Resources Inc. |
|
|
| $ | 241,827 |
| $ | (57,983) |
| $ | 527,983 |
| $ | (98,636) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share of common stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
| 10 |
|
| 1.74 |
|
| (0.36) |
|
| 3.35 |
|
| (0.66) |
Diluted |
| 10 |
|
| 1.74 |
|
| (0.36) |
|
| 3.35 |
|
| (0.66) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to unaudited condensed consolidated financial statements. | ||||||||||||||
Three months ended
Unaudited Condensed Consolidated Statements ofStockholders’ Equity
|
|
| Common stock |
| Preferred stock |
| Additional |
| Accumulated other |
|
|
|
|
| Total | ||||
|
|
|
|
|
|
|
|
|
|
| paid in |
| comprehensive |
| Retained |
| Noncontrolling |
| stockholders |
|
|
| Shares |
| Amount |
| Series A |
| Amount |
| capital |
| losses |
| earnings |
| interest |
| equity |
Balance December 31, 2021 |
|
| 167,645,373 | $ | 1,677 |
| 1 | $ | 0 | $ | 1,089,547 | $ | (44,228) | $ | 30,506 | $ | 0 | $ | 1,077,502 |
Net income |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 0 |
| 269,898 |
| 0 |
| 269,898 |
Other comprehensive income |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 16,258 |
| 0 |
| 0 |
| 16,258 |
Total comprehensive income |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 16,258 |
| 269,898 |
| 0 |
| 286,156 |
Share-based compensation for equity classified awards |
|
| — |
| 0 |
| — |
| 0 |
| 84 |
| 0 |
| 0 |
| 0 |
| 84 |
Dividends |
| 4 | — |
| 0 |
| — |
| 0 |
| 0 |
| 0 |
| (150,881) |
| 0 |
| (150,881) |
Balance March 31, 2022 |
|
| 167,645,373 | $ | 1,677 |
| 1 | $ | 0 | $ | 1,089,631 | $ | (27,970) | $ | 149,523 | $ | 0 | $ | 1,212,861 |
Net income |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 0 |
| 291,995 |
| 0 |
| 291,995 |
Other comprehensive loss |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| (50,168) |
| 0 |
| 0 |
| (50,168) |
Total comprehensive (loss) income |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| (50,168) |
| 291,995 |
| 0 |
| 241,827 |
Issuance of common stock, net |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 |
| 0 |
Share-based compensation for equity classified awards |
|
| — |
| 0 |
| — |
| 0 |
| 1,731 |
| 0 |
| 0 |
| 0 |
| 1,731 |
Dividends |
| 4 | — |
| 0 |
| — |
| 0 |
| 0 |
| 0 |
| (200,040) |
| 0 |
| (200,040) |
Balance June 30, 2022 |
|
| 167,645,373 | $ | 1,677 |
| 1 | $ | 0 | $ | 1,091,362 | $ | (78,138) | $ | 241,478 | $ | 0 | $ | 1,256,379 |
Common stock
Coronado Global Resources Inc.
tax)
|
|
| Common stock |
| Preferred stock |
| Additional |
| Accumulated other |
|
|
|
|
| Total | ||||
|
|
|
|
|
|
|
|
|
|
| paid in |
| comprehensive |
| (Accumulated |
| Noncontrolling |
| stockholders |
|
|
| Shares |
| Amount |
| Series A |
| Amount |
| capital |
| losses |
| losses) |
| interest |
| equity |
Balance December 31, 2020 |
|
| 138,387,890 | $ | 1,384 |
| 1 | $ | 0 | $ | 993,052 | $ | (28,806) | $ | (158,919) | $ | 152 | $ | 806,863 |
Net loss |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 0 |
| (40,970) |
| (2) |
| (40,972) |
Other comprehensive income (net of $2,111 tax) |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 317 |
| 0 |
| 0 |
| 317 |
Total comprehensive income (loss) |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 317 |
| (40,970) |
| (2) |
| (40,655) |
Share-based compensation for equity classified awards |
|
| — |
| 0 |
| — |
| 0 |
| (538) |
| 0 |
| 0 |
| 0 |
| (538) |
Acquisition of non-controlling interest |
|
| — |
| 0 |
| — |
| 0 |
| (703) |
| 0 |
| 0 |
| (150) |
| (853) |
Balance March 31, 2021 |
|
| 138,387,890 | $ | 1,384 |
| 1 | $ | 0 | $ | 991,811 | $ | (28,489) | $ | (199,889) | $ | 0 | $ | 764,817 |
Net loss |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| 0 |
| (55,085) |
| 0 |
| (55,085) |
Other comprehensive loss (net of $24 tax) |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| (2,898) |
| 0 |
| 0 |
| (2,898) |
Total comprehensive loss |
|
| — |
| 0 |
| — |
| 0 |
| 0 |
| (2,898) |
| (55,085) |
| 0 |
| (57,983) |
Issuance of common stock, net |
|
| 29,257,483 |
| 293 |
| — |
| 0 |
| 97,448 |
| 0 |
| 0 |
| 0 |
| 97,741 |
Share-based compensation for equity classified awards |
|
| — |
| 0 |
| — |
| 0 |
| 737 |
| 0 |
| 0 |
| 0 |
| 737 |
Balance June 30, 2021 |
|
| 167,645,373 | $ | 1,677 |
| 1 | $ | 0 | $ | 1,089,996 | $ | (31,387) | $ | (254,974) | $ | 0 | $ | 805,312 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying notes to unaudited condensed consolidated financial statements. | |||||||||||||||||||
Coronado Global Resources Inc.
Unaudited Condensed Consolidated Statements ofCash Flows
|
| Six months ended | ||||
|
| June 30, | ||||
|
| 2022 |
| 2021 | ||
Cash flows from operating activities: |
|
|
|
|
|
|
Net income (loss) |
| $ | 561,893 |
| $ | (96,057) |
Adjustments to reconcile net income to cash and restricted cash provided by operating activities: |
|
|
|
|
|
|
Depreciation, depletion and amortization |
|
| 89,393 |
|
| 94,293 |
Amortization of right of use asset - operating leases |
|
| 4,501 |
|
| 4,478 |
Amortization of deferred financing costs |
|
| 968 |
|
| 2,491 |
Loss on debt extinguishment |
|
| 0 |
|
| 5,744 |
Non-cash interest expense |
|
| 15,622 |
|
| 13,544 |
Amortization of contract obligations |
|
| (21,947) |
|
| (16,747) |
Loss on disposal of property, plant and equipment |
|
| 257 |
|
| 529 |
Equity-based compensation expense |
|
| 1,815 |
|
| 199 |
Deferred income taxes |
|
| 42,061 |
|
| (7,031) |
Reclamation of asset retirement obligations |
|
| (3,601) |
|
| (1,562) |
Increase (decrease) in provision for discounting and credit losses |
|
| 584 |
|
| (5,644) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Accounts receivable - including related party receivables |
|
| (304,707) |
|
| 45,205 |
Inventories |
|
| 9,700 |
|
| (10,630) |
Other current assets |
|
| (18,460) |
|
| (3,601) |
Accounts payable |
|
| (5,160) |
|
| 32,979 |
Accrued expenses and other current liabilities |
|
| 71,595 |
|
| 611 |
Operating lease liabilities |
|
| (4,163) |
|
| (5,509) |
Income tax payable |
|
| 73,114 |
|
| 0 |
Change in other liabilities |
|
| 4,827 |
|
| 3,632 |
Net cash provided by operating activities |
|
| 518,292 |
|
| 56,924 |
Cash flows from investing activities: |
|
|
|
|
|
|
Capital expenditures |
|
| (87,875) |
|
| (58,307) |
Purchase of restricted deposits |
|
| (6,251) |
|
| (84,342) |
Redemption of restricted deposits |
|
| 606 |
|
| 19,726 |
Net cash used in investing activities |
|
| (93,520) |
|
| (122,923) |
Cash flows from financing activities: |
|
|
|
|
|
|
Proceeds from interest bearing liabilities and other financial liabilities |
|
| 0 |
|
| 411,524 |
Debt issuance costs and other financing costs |
|
| 0 |
|
| (15,143) |
Principal payments on interest bearing liabilities and other financial liabilities |
|
| (7,085) |
|
| (365,413) |
Principal payments on finance lease obligations |
|
| (61) |
|
| 0 |
Premiums paid on early redemption of debt |
|
| (22) |
|
| 0 |
Dividends paid |
|
| (348,423) |
|
| 0 |
Proceeds from stock issuance, net |
|
| 0 |
|
| 97,741 |
Net cash (used in) provided by financing activities |
|
| (355,591) |
|
| 128,709 |
Net increase in cash and restricted cash |
|
| 69,181 |
|
| 62,710 |
Effect of exchange rate changes on cash and restricted cash |
|
| (21,228) |
|
| 5,215 |
Cash and restricted cash at beginning of period |
|
| 437,931 |
|
| 45,736 |
Cash and restricted cash at end of period |
| $ | 485,884 |
| $ | 113,661 |
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
Cash payments for interest |
| $ | 18,338 |
| $ | 13,006 |
Cash paid (refund) for taxes |
| $ | 69,388 |
| $ | (4,433) |
Restricted cash |
| $ | 251 |
| $ | 251 |
See accompanying notes to unaudited condensed consolidated financial statements. | ||||||
Nine months ended
NOTES TO UNAUDITED CONDENSED CONSOLIDATEDFINANCIAL STATEMENTS
1.Description of Business, Basis of Presentation
2.Summary of Significant Accounting Policies
3.Segment Information
Coronado Global Resources Inc.
|
|
| Australia |
|
| United States |
|
| Other and Corporate |
|
| Total |
|
|
| (in US$ thousands) | |||||||||
Three months ended June 30, 2022 |
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
| $ | 578,388 |
| $ | 454,316 |
| $ | — |
| $ | 1,032,704 |
Adjusted EBITDA |
|
| 196,315 |
|
| 252,394 |
|
| (10,349) |
|
| 438,360 |
Net income (loss) |
|
| 127,905 |
|
| 181,146 |
|
| (17,056) |
|
| 291,995 |
Total assets |
|
| 1,473,795 |
|
| 1,044,753 |
|
| 240,943 |
|
| 2,759,491 |
Capital expenditures |
|
| 30,755 |
|
| 20,673 |
|
| 236 |
|
| 51,664 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
| $ | 251,432 |
| $ | 172,824 |
| $ | — |
| $ | 424,256 |
Adjusted EBITDA |
|
| (13,880) |
|
| 39,434 |
|
| (7,493) |
|
| 18,061 |
Net (loss) income |
|
| (63,507) |
|
| 18,323 |
|
| (9,901) |
|
| (55,085) |
Total assets |
|
| 1,115,815 |
|
| 872,345 |
|
| 168,427 |
|
| 2,156,587 |
Capital expenditures |
|
| 13,180 |
|
| 16,087 |
|
| 435 |
|
| 29,702 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2022 |
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
| $ | 1,183,686 |
| $ | 796,143 |
| $ | 0 |
| $ | 1,979,829 |
Adjusted EBITDA |
|
| 435,284 |
|
| 432,294 |
|
| (18,231) |
|
| 849,347 |
Net income (loss) |
|
| 278,052 |
|
| 304,113 |
|
| (20,272) |
|
| 561,893 |
Total assets |
|
| 1,473,795 |
|
| 1,044,753 |
|
| 240,943 |
|
| 2,759,491 |
Capital expenditures |
|
| 46,716 |
|
| 44,422 |
|
| 329 |
|
| 91,467 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
| $ | 489,726 |
| $ | 310,641 |
| $ | 0 |
| $ | 800,367 |
Adjusted EBITDA |
|
| (36,937) |
|
| 75,963 |
|
| (13,324) |
|
| 25,702 |
Net (loss) income |
|
| (105,838) |
|
| 28,713 |
|
| (18,932) |
|
| (96,057) |
Total assets |
|
| 1,115,815 |
|
| 872,345 |
|
| 168,427 |
|
| 2,156,587 |
Capital expenditures |
|
| 20,214 |
|
| 30,625 |
|
| 1,468 |
|
| 52,307 |
Coronado Global Resources Inc. Form 10-Q JuneTotalrevenues
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Totalrevenues
Three months ended Six months ended June 30, June 30, 2022 2021 2022 2021 (in US$ thousands) (in US$ thousands) Net income (loss) $ 291,995 $ (55,085) $ 561,893 $ (96,057) Depreciation, depletion and amortization 51,384 41,212 89,393 94,293 Interest expense (net of income) 17,482 16,596 34,814 31,731 Other foreign exchange (gains) losses (25,138) 140 (23,147) 1,889 Loss on extinguishment of debt 0 5,744 0 5,744 Income tax expense (benefit) 102,025 8,184 183,968 (10,884) Restructuring costs 0 2,300 0 2,300 Losses on idled assets held for sale(1) 456 836 1,842 2,330 Increase (decrease) in provision for discounting and credit losses 156 (1,866) 584 (5,644) Consolidated Adjusted EBITDA $ 438,360 $ 18,061 $ 849,347 $ 25,702sixnine monthsJuneSeptember 30, 2022 and 2021 are as follows:
FINANCIAL STATEMENTS(Continued)
|
|
| Six months ended June 30, | |||
|
|
| 2022 |
|
| 2021 |
|
|
| (in US$ thousands) | |||
Capital expenditures per Condensed Consolidated Statements of Cash Flows |
| $ | 87,875 |
| $ | 58,307 |
Accruals for capital expenditures |
|
| 11,067 |
|
| 0 |
Payment for capital acquired in prior periods |
|
| (7,475) |
|
| (6,000) |
Capital expenditures per segment detail |
| $ | 91,467 |
| $ | 52,307 |
|
|
| Three months ended June 30, 2022 | ||||||
|
|
| Australia |
|
| United States |
|
| Total |
|
|
| (in US$ thousands) | ||||||
Product Groups: |
|
|
|
|
|
|
|
|
|
Metallurgical coal |
| $ | 543,345 |
| $ | 450,858 |
| $ | 994,203 |
Thermal coal |
|
| 25,001 |
|
| 1,793 |
|
| 26,794 |
Total coal revenue |
|
| 568,346 |
|
| 452,651 |
|
| 1,020,997 |
Other(1) |
|
| 10,042 |
|
| 1,665 |
|
| 11,707 |
Total |
| $ | 578,388 |
| $ | 454,316 |
| $ | 1,032,704 |
Coronado Global Resources Inc. Form 10-Q June 30, 20229
|
|
| Three months ended June 30, 2021 | ||||||
|
|
| Australia |
|
| United States |
|
| Total |
|
|
| (in US$ thousands) | ||||||
Product Groups: |
|
|
|
|
|
|
|
|
|
Metallurgical coal |
| $ | 221,659 |
| $ | 168,472 |
| $ | 390,131 |
Thermal coal |
|
| 21,090 |
|
| 2,543 |
|
| 23,633 |
Total coal revenue |
|
| 242,749 |
|
| 171,015 |
|
| 413,764 |
Other(1) |
|
| 8,683 |
|
| 1,809 |
|
| 10,492 |
Total |
| $ | 251,432 |
| $ | 172,824 |
| $ | 424,256 |
|
|
| Six months ended June 30, 2022 | ||||||
|
|
| Australia |
|
| United States |
|
| Total |
|
|
| (in US$ thousands) | ||||||
Product Groups |
|
|
|
|
|
|
|
|
|
Metallurgical coal |
| $ | 1,097,353 |
| $ | 788,579 |
| $ | 1,885,932 |
Thermal coal |
|
| 67,291 |
|
| 4,402 |
|
| 71,693 |
Total coal revenue |
|
| 1,164,644 |
|
| 792,981 |
|
| 1,957,625 |
Other(1) |
|
| 19,042 |
|
| 3,162 |
|
| 22,204 |
Total |
| $ | 1,183,686 |
| $ | 796,143 |
| $ | 1,979,829 |
|
|
| Six months ended June 30, 2021 | ||||||
|
|
| Australia |
|
| United States |
|
| Total |
|
|
| (in US$ thousands) | ||||||
Product Groups |
|
|
|
|
|
|
|
|
|
Metallurgical coal |
| $ | 428,110 |
| $ | 305,456 |
| $ | 733,566 |
Thermal coal |
|
| 44,089 |
|
| 3,311 |
|
| 47,400 |
Total coal revenue |
|
| 472,199 |
|
| 308,767 |
|
| 780,966 |
Other(1) |
|
| 17,527 |
|
| 1,874 |
|
| 19,401 |
Total |
| $ | 489,726 |
| $ | 310,641 |
| $ | 800,367 |
Coronado Global Resources Inc.
Form 10-Q September 30, 202212
2022
2022
Coronado Global Resources Inc. Form 10-Q June 30, 202210
5.Inventories
(in US$ thousands) |
| June 30, 2022 |
| December 31, | ||
Raw coal |
| $ | 10,234 |
| $ | 17,334 |
Saleable coal |
|
| 37,971 |
|
| 42,006 |
Total coal inventories |
|
| 48,205 |
|
| 59,340 |
Supplies inventory |
|
| 59,234 |
|
| 59,582 |
Total inventories |
| $ | 107,439 |
| $ | 118,922 |
Coal inventories measured at its net realizable value were $1.9million and $2.2 million at JuneForm 10-Q September 30, 2022 and December 31, 2021, respectively, and relates to coal designated for deliveries under the Stanwell non-market coal supply agreement.
13
6.Property, Plant andEquipment
(in US$ thousands) |
| June 30, 2022 |
| December 31, | ||
Land |
| $ | 27,197 |
| $ | 27,853 |
Buildings and improvements |
|
| 92,604 |
|
| 88,079 |
Plant, machinery, mining equipment and transportation vehicles |
|
| 992,728 |
|
| 963,272 |
Mineral rights and reserves |
|
| 374,326 |
|
| 374,326 |
Office and computer equipment |
|
| 9,274 |
|
| 8,718 |
Mine development |
|
| 557,596 |
|
| 566,201 |
Asset retirement obligation asset |
|
| 70,584 |
|
| 75,215 |
Construction in process |
|
| 49,257 |
|
| 42,055 |
|
|
| 2,173,566 |
|
| 2,145,719 |
Less accumulated depreciation, depletion and amortization |
|
| 810,194 |
|
| 748,356 |
Net property, plant and equipment |
| $ | 1,363,372 |
| $ | 1,397,363 |
(in US$ thousands) |
| June 30, 2022 |
| December 31, | ||
Wages and employee benefits |
| $ | 37,392 |
| $ | 41,187 |
Taxes other than income taxes |
|
| 8,384 |
|
| 6,246 |
Accrued royalties |
|
| 104,952 |
|
| 70,237 |
Accrued freight costs |
|
| 42,104 |
|
| 27,754 |
Accrued mining fees |
|
| 104,694 |
|
| 65,835 |
Acquisition related accruals |
|
| 29,623 |
|
| 31,201 |
Other liabilities |
|
| 14,652 |
|
| 28,482 |
Total accrued expenses and other current liabilities |
| $ | 341,801 |
| $ | 270,942 |
unaudited Condensed Consolidated Balance Sheet.
8.Interest Bearing Liabilities
The following is a summary of interest-bearing liabilities at June 30, 2022: | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |
(in US$ thousands) |
|
| June 30, 2022 |
|
| December 31, 2021 |
| Weighted Average Interest Rate at June 30, 2022 |
| Final Maturity | ||
10.75% Senior Secured Notes |
| $ | 314,453 |
| $ | 315,000 |
| 12.14% | (2) |
| 2026 | |
ABL Facility |
|
| 0 |
|
| 0 |
|
|
|
| 2024 | |
Discount and debt issuance costs(1) |
|
| (13,505) |
|
| (14,831) |
|
|
|
|
| |
Total interest bearing liabilities |
| $ | 300,948 |
| $ | 300,169 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
| |
(1) Debt issuance costs incurred on the establishment of the ABL Facility has been included within "Other non-current assets" on the unaudited Condensed Consolidated Balance Sheet. | ||||||||||||
(2) Represents the effective interest rate. |
|
|
|
|
|
|
|
|
|
|
| |
Senior Secured Notes
As of JuneForm 10-Q September 30, 2022 the Company’s aggregate principal amount of the 10.750% Senior Secured Notes due 2026, or the Notes, outstanding was $314.5 million. The Notes mature 14
The terms of the Notes are governed by an indenture, dated as of May 12, 2021, or the Indenture, among Coronado Finance Pty Ltd, an Australian proprietary company, as issuer, Coronado, as parent guarantor, the other guarantors party thereto and Wilmington Trust, National Association, as trustee. The Indenture contains customary covenants for high yield bonds, including, but not limited to, limitations on investments,liens,
Debt
2024
Debt debtissuance costs, recorded as “Other non-current assets” inthe unaudited Consolidated
Coronado Global Resources Inc. Form 10-Q June 30, 202212
9.Income Taxes
Income tax benefit of $10.9 $
Coronado Global Resources Inc. Form 10-Q June 30, 202213
10.Earnings per Share
Basic and diluted earnings per share was calculated as follows (in thousands, except per share data): | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three months ended June 30, |
| Six months ended June 30, | ||||||||
(in US$ thousands, except per share data) |
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||
Numerator: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
| $ | 291,995 |
| $ | (55,085) |
| $ | 561,893 |
| $ | (96,057) |
Less: Net loss attributable to Non-controlling interest |
|
| 0 |
|
| 0 |
|
| 0 |
|
| (2) |
Net income (loss) attributable to Company stockholders |
| $ | 291,995 |
| $ | (55,085) |
| $ | 561,893 |
| $ | (96,055) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares of common stock outstanding |
|
| 167,645 |
|
| 152,877 |
|
| 167,645 |
|
| 145,633 |
Effects of dilutive shares |
|
| 168 |
|
| 0 |
|
| 192 |
|
| 0 |
Weighted average diluted shares of common stock outstanding |
|
| 167,813 |
|
| 152,877 |
|
| 167,837 |
|
| 145,633 |
Earnings (Loss) Per Share (US$): |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
| 1.74 |
|
| (0.36) |
|
| 3.35 |
|
| (0.66) |
Dilutive |
|
| 1.74 |
|
| (0.36) |
|
| 3.35 |
|
| (0.66) |
Coronado Global Resources Inc.
(in US$ thousands) Amount Year ending December 31, 2022 $ 4,182 2023 4,984 2024 4,891 2025 4,752 2026 4,684 Thereafter 23,666 Total $ 47,159 Mineral leases are not in scope of ASC 842 and continue to be accounted for under the guidance in ASC 932, Extractive Activities – Mining. June June September30,2022,therewere 0 $327.0 $ (Level12.Accumulated Other Comprehensive LossesJuneSeptember 30, 2022:(in US$ thousands)Foreign currency translation adjustmentsBalance at December 31, 2021$(44,228)Net current-period other comprehensive income (loss):Loss in other comprehensive income (loss) before reclassifications(12,918)Loss on long-term intra-entity foreign currency transactions(20,992)Total net current-period other comprehensive gain(33,910)Balance at June 30, 2022$(78,138)Coronado Global Resources Inc. Form 10-Q June15
14.Contingencies
Coronado Global Resources Inc. Form 10-Q JuneStamp duty on Curragh acquisition
From time to time, theCompany becomes aparty to other legalproceedings in theordinary course of business
the Company’s Board of Directors declared a total unfranked ordinary dividend of $125.7 million, or 7.5 cents per CDI, comprising $100.6 million of the unaccepted portion of the offer to purchase the Notes made in connection with the special dividends declared on May 9, 2022, plusan additional $25.2 $ “ex”“ex” dividendon August 29,November18, 2022,Australia time.The dividendswill havea August 30, September 20,$125.7 $$25.2 $ 104%
REPORT OF INDEPENDENT REGISTERED PUBLICACCOUNTING FIRM
ITEM 2.MANAGEMENT’S DISCUSSIONAND ANALYSISOF FINANCIALCONDITION ANDRESULTSOF
Coronado Global Resources Inc. Form 10-Q June 30, 202219
our indebtedness and ability tocomply with the covenants and otherundertakings under the agreements
the prices we receive for our coal;
Wemakemanyofourforward-lookingstatementsbasedonouroperatingbudgetsandforecasts,whichare
The ongoing trade
logistical issues.
take advantage ofthe current price arbitragebetween the Thermaland Met coal
2022 were$571.4 million,or 48.3%,higher comparedto thecorresponding periodin 2021primarily drivenby
Coronado Global Resources Inc. Form 10-Q June 30, 202222
recurring items that we exclude inanalyzing each of our segments’operating performance. Adjusted EBITDAis
Three Months Ended JuneSeptember 30, 2022 Comparedto Three Months Ended JuneSeptember 30, 2021
Sales volume totaled 3.9 MMt
Net income for the three months ended June 30, 2022 of $292.0$150.6 million increased by $347.1$68.6 million,
Although coking
coal revenues (exclusive of items
|
| Three months ended June 30, | |||||||||
|
|
| 2022 |
|
| 2021 |
|
| Change |
| % |
|
| (in US$ thousands) | |||||||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Coal revenues |
| $ | 1,020,997 |
| $ | 413,764 |
| $ | 607,233 |
| 146.8% |
Other revenues |
|
| 11,707 |
|
| 10,492 |
|
| 1,215 |
| 11.6% |
Total revenues |
|
| 1,032,704 |
|
| 424,256 |
|
| 608,448 |
| 143.4% |
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
Cost of coal revenues (exclusive of items shown separately below) |
|
| 397,463 |
|
| 306,155 |
|
| 91,308 |
| 29.8% |
Depreciation, depletion and amortization |
|
| 51,384 |
|
| 41,212 |
|
| 10,172 |
| 24.7% |
Freight expenses |
|
| 67,026 |
|
| 55,906 |
|
| 11,120 |
| 19.9% |
Stanwell rebate |
|
| 40,532 |
|
| 15,076 |
|
| 25,456 |
| 168.9% |
Other royalties |
|
| 79,348 |
|
| 23,173 |
|
| 56,175 |
| 242.4% |
Selling, general, and administrative expenses |
|
| 10,376 |
|
| 7,431 |
|
| 2,945 |
| 39.6% |
Restructuring costs |
|
| — |
|
| 2,300 |
|
| (2,300) |
| (100.0%) |
Total costs and expenses |
|
| 646,129 |
|
| 451,253 |
|
| 194,876 |
| 43.2% |
Other income (expenses): |
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
| (17,482) |
|
| (16,596) |
|
| (886) |
| 5.3% |
Loss on debt extinguishment |
|
| — |
|
| (5,744) |
|
| 5,744 |
| (100.0%) |
(Increase) decrease in provision for discounting and credit losses |
|
| (156) |
|
| 1,866 |
|
| (2,022) |
| (108.4%) |
Other, net |
|
| 25,083 |
|
| 570 |
|
| 24,513 |
| 4,300.5% |
Total other expense, net |
|
| 7,445 |
|
| (19,904) |
|
| 27,349 |
| (137.4%) |
Net income (loss) before tax |
|
| 394,020 |
|
| (46,901) |
|
| 440,921 |
| (940.1%) |
Income tax (expense) benefit |
|
| (102,025) |
|
| (8,184) |
|
| (93,841) |
| 1,146.6% |
Net income (loss) |
|
| 291,995 |
|
| (55,085) |
|
| 347,080 |
| (630.1%) |
Net income (loss) attributable to Coronado Global Resources, Inc. |
| $ | 291,995 |
| $ | (55,085) |
| $ | 347,080 |
| (630.1%) |
shown separately below)
AustralianOperations.
Our U.S. Operations contributed $50.72022, was$25.6millionhighercomparedto the increase in total cost of coal revenues, driven bythree monthsended
Depreciation, Depletion Freight Expenses
Depreciation, depletion portprovidersand amortization
Freight Expenses
Freight expenses include costs associated with take-or-pay commitments for rail and port providers and demurrage costs. Freight expenses totaled $67.0 millionfor the three months ended June 30, 2022, an increase of $11.1 million, compared to $55.9 million for the three months ended June 30, 2021. Our U.S.
costs,offset by a $2.1 milliondecrease in freight cost for our
AustralianOperations.
Loss on Debt Extinguishment
During additionalroyaltiesatourAustralianOperationsof$58.7millionforthethree
Sixto Nine months ended JuneSeptember 30, 2022 Compared to Six months ended June 30, 2021
Sales volume totaled 8.3 MMt for the six months ended June 30, 2022, or 0.6 MMt lower than the six months ended June 30, 2021. The lower sales volumes were primarily driven by significant wet weather events at our Australian Operations and adverse geological conditions at one of our mine complexes at our U.S. Operations during the second quarter of 2022.
Coronado Global Resources Inc. Form 10-Q June 30, 202225
The SupplyconcernsinkeyMetcoalmarkets,includingthecontinuedimpactoftheRussianinvasionof
The lower salesvolumes were primarilydriven bysignificant
|
| Six months ended June 30, | |||||||||
|
|
| 2022 |
|
| 2021 |
|
| Change |
| % |
|
| (in US$ thousands) | |||||||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Coal revenues |
| $ | 1,957,625 |
| $ | 780,966 |
| $ | 1,176,659 |
| 150.7% |
Other revenues |
|
| 22,204 |
|
| 19,401 |
|
| 2,803 |
| 14.4% |
Total revenues |
|
| 1,979,829 |
|
| 800,367 |
|
| 1,179,462 |
| 147.4% |
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
Cost of coal revenues (exclusive of items shown separately below) |
|
| 754,963 |
|
| 580,258 |
|
| 174,705 |
| 30.1% |
Depreciation, depletion and amortization |
|
| 89,393 |
|
| 94,293 |
|
| (4,900) |
| (5.2%) |
Freight expenses |
|
| 126,290 |
|
| 108,047 |
|
| 18,243 |
| 16.9% |
Stanwell rebate |
|
| 69,585 |
|
| 30,895 |
|
| 38,690 |
| 125.2% |
Other royalties |
|
| 162,380 |
|
| 44,120 |
|
| 118,260 |
| 268.0% |
Selling, general, and administrative expenses |
|
| 18,252 |
|
| 13,206 |
|
| 5,046 |
| 38.2% |
Restructuring costs |
|
| — |
|
| 2,300 |
|
| (2,300) |
| (100.0%) |
Total costs and expenses |
|
| 1,220,863 |
|
| 873,119 |
|
| 347,744 |
| 39.8% |
Other income (expenses): |
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
| (34,814) |
|
| (31,731) |
|
| (3,083) |
| 9.7% |
Loss on debt extinguishment |
|
| — |
|
| (5,744) |
|
| 5,744 |
| (100.0%) |
(Increase) decrease in provision for discounting and credit losses |
|
| (584) |
|
| 5,644 |
|
| (6,228) |
| (110.3%) |
Other, net |
|
| 22,293 |
|
| (2,358) |
|
| 24,651 |
| (1,045.4%) |
Total other expense, net |
|
| (13,105) |
|
| (34,189) |
|
| 21,084 |
| (61.7%) |
Net income (loss) before tax |
|
| 745,861 |
|
| (106,941) |
|
| 852,802 |
| (797.5%) |
Income tax (expense) benefit |
|
| (183,968) |
|
| 10,884 |
|
| (194,852) |
| (1,790.3%) |
Net income (loss) |
|
| 561,893 |
|
| (96,057) |
|
| 657,950 |
| (685.0%) |
Less: Net loss attributable to noncontrolling interest |
|
| — |
|
| (2) |
|
| 2 |
| (100.0%) |
Net income (loss) attributable to Coronado Global Resources, Inc. |
| $ | 561,893 |
| $ | (96,055) |
| $ | 657,948 |
| (685.0%) |
Coronado Global Resources Inc. Form 10-Q June 30, 202226
certain mines of our U.S. Operations resulting in unplanned maintenance costs and increased purchased coal transactionsdue to meet sales commitments. Cost of coal revenues for our Australian Operations in the six months ended June 30, 2022 increased by $83.2 million, as compared to the same period in 2021, driven by an additional fleetfleets mobilized to accelerate overburden removal, inflationary pressureon fuel
Freight Expenses
Freight expenses totaled $126.2 million for the six months ended June 30, 2022, anincrease of $18.2 $23.2
favorable average foreignexchange rate ontranslation of theAustralianOperations.
Interest Expense, net
Interest expense, net 2021,
Other, net
Other, net was $22.3 million in the six months ended June 30, 2022, an increase2021.
Income Tax (Expense) Benefit
Income tax expense of $184.0 million for the six months ended June 30, 2022 decreased by $194.9 million, as compared to a $10.9 million tax benefit for the six months ended June 30, 2021, primarily driven by higher income before tax in the 2022 period.
The income tax expense for the six months ended June 30, 2022 is based on an annual effective tax rate of 24.7%.
Coronado Global Resources Inc. Form 10-Q June 30, 202227
Supplemental Segment Financial Data
Three months ended June 30, 2022 compared to three months ended June 30, 2021
Australia
|
| Three months ended June 30, | ||||||
|
| 2022 |
| 2021 |
| Change |
| % |
|
| (in US$ thousands) | ||||||
Sales volume (MMt) |
| 2.3 |
| 2.8 |
| (0.5) |
| (17.0)% |
Total revenues ($) |
| 578,388 |
| 251,432 |
| 326,956 |
| 130.0% |
Coal revenues ($) |
| 568,346 |
| 242,749 |
| 325,597 |
| 134.1% |
Average realized price per Mt sold ($/Mt) |
| 244.4 |
| 86.6 |
| 157.8 |
| 182.2% |
Met sales volume (MMt) |
| 1.5 |
| 2.1 |
| (0.6) |
| (27.8)% |
Met coal revenues ($) |
| 543,345 |
| 221,659 |
| 321,686 |
| 145.1% |
Average realized Met price per Mt sold ($/Mt) |
| 357.4 |
| 105.2 |
| 252.2 |
| 239.7% |
Mining costs ($) |
| 205,272 |
| 175,760 |
| 29,512 |
| 16.8% |
Mining cost per Mt sold ($/Mt) |
| 94.1 |
| 66.8 |
| 27.3 |
| 40.9% |
Operating costs ($) |
| 381,907 |
| 266,199 |
| 115,708 |
| 43.5% |
Operating costs per Mt sold ($/Mt) |
| 164.2 |
| 95.0 |
| 69.2 |
| 72.8% |
Segment Adjusted EBITDA ($) |
| 196,315 |
| (13,880) |
| 210,195 |
| (1,514.4)% |
Coal revenues for our Australian Operations for the three months ended June 30, 2022 were $568.3 million, an increase of $325.6 million or 134.1%, compared to $242.7$88.0 million for the three months ended June 30, 2021. This increase was largely driven by a higher average realized Met price per Mt sold for the three months ended June 30, 2022 of $357.4 compared to $105.2 per Mt sold for the same period in 2021 benefiting from elevated demand and prices from ongoing trade constraints for Russian coal and the impact it has had on supply dynamics. Sales volume of 2.3 MMt decreased by 0.5 MMt, compared to 2.8 MMt for the three months ended June 30, 2021, as a result of above average wet weather impacting production at the Curragh mine complex.
Operating costs increased by $115.7 million, or 43.5%, for the three months ended June 30, 2022, compared to the three months ended June 30, 2021. The increase was driven by higher mining costs, other royalties and Stanwell rebate (mainly due to higher realized coal pricing). Mining cost per Mt sold of $94.1 for the three months ended June 30, 2022 was 40.9% higher compared to the three months ended June 30, 2021, primarily due to inflationary impacts including higher fuel prices, increase in purchased coal to meet sales commitments and additional contractor fleets mobilized at our Australian Operations.
Segment Adjusted EBITDA of $196.3 million for the three months ended JuneSeptember 30, 2022 increased by $210.2 $20.6
United States
|
| Three months ended June 30, | ||||||
|
| 2022 |
| 2021 |
| Change |
| % |
|
| (in US$ thousands) | ||||||
Sales volume (MMt) |
| 1.6 |
| 1.7 |
| (0.1) |
| (5.1)% |
Total revenues ($) |
| 454,316 |
| 172,824 |
| 281,492 |
| 162.9% |
Coal revenues ($) |
| 452,651 |
| 171,015 |
| 281,636 |
| 164.7% |
Average realized price per Mt sold ($/Mt) |
| 283.4 |
| 101.6 |
| 181.8 |
| 178.9% |
Met sales volume (MMt) |
| 1.6 |
| 1.6 |
| — |
| (1.8)% |
Met coal revenues ($) |
| 450,858 |
| 168,472 |
| 282,386 |
| 167.6% |
Average realized Met price per Mt sold ($/Mt) |
| 286.2 |
| 105.0 |
| 181.2 |
| 172.6% |
Mining costs ($) |
| 148,922 |
| 109,137 |
| 39,785 |
| 36.5% |
Mining cost per Mt sold ($/Mt) |
| 96.9 |
| 65.4 |
| 31.5 |
| 48.2% |
Operating costs ($) |
| 202,462 |
| 134,111 |
| 68,351 |
| 51.0% |
Operating costs per Mt sold ($/Mt) |
| 126.7 |
| 79.7 |
| 47.0 |
| 59.0% |
Segment Adjusted EBITDA ($) |
| 252,394 |
| 39,434 |
| 212,960 |
| 540.0% |
a higher averageUnited States
costs.
|
| Three months ended June 30, | ||||||||||
|
|
| 2022 |
|
| 2021 |
|
| Change |
|
| % |
|
| (in US$ thousands) | ||||||||||
Selling, general, and administrative expenses |
| $ | 10,376 |
| $ | 7,431 |
| $ | 2,945 |
|
| 39.6% |
Other, net |
|
| (27) |
|
| 62 |
|
| (89) |
|
| n/m |
Total Corporate and Other Adjusted EBITDA |
| $ | 10,349 |
| $ | 7,493 |
| $ | 2,856 |
|
| 38.1% |
Mining and operatingcosts for thethree monthsended September30, 2022 comparedto threemonths
A reconciliation of segment costs and expenses, segment operating costs, and segment mining costs is shown below:
|
| Three months ended June 30, 2022 | ||||||||||
|
| (in US$ thousands) | ||||||||||
|
|
| Australia |
|
| United States |
|
| Other / Corporate |
|
| Total Consolidated |
Total costs and expenses |
| $ | 410,520 |
| $ | 224,942 |
| $ | 10,667 |
| $ | 646,129 |
Less: Selling, general and administrative expense |
|
| — |
|
| — |
|
| (10,376) |
|
| (10,376) |
Less: Depreciation, depletion and amortization |
|
| (28,613) |
|
| (22,480) |
|
| (291) |
|
| (51,384) |
Total operating costs |
|
| 381,907 |
|
| 202,462 |
|
| — |
|
| 584,369 |
Less: Other royalties |
|
| (66,628) |
|
| (12,720) |
|
| — |
|
| (79,348) |
Less: Stanwell rebate |
|
| (40,532) |
|
| — |
|
| — |
|
| (40,532) |
Less: Freight expenses |
|
| (38,734) |
|
| (28,292) |
|
| — |
|
| (67,026) |
Less: Other non-mining costs |
|
| (30,741) |
|
| (12,528) |
|
| — |
|
| (43,269) |
Total mining costs |
|
| 205,272 |
|
| 148,922 |
|
| — |
|
| 354,194 |
Sales Volume excluding non-produced coal (MMt) |
|
| 2.2 |
|
| 1.5 |
|
| — |
|
| 3.7 |
Mining cost per Mt sold ($/Mt) |
|
| 94.1 |
|
| 96.9 |
|
| — |
|
| 95.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three months ended June 30, 2021 | ||||||||||
|
| (in US$ thousands) | ||||||||||
|
|
| Australia |
|
| United States |
|
| Other / Corporate |
|
| Total Consolidated |
Total costs and expenses |
| $ | 290,914 |
| $ | 152,662 |
| $ | 7,677 |
| $ | 451,253 |
Less: Selling, general and administrative expense |
|
| — |
|
| — |
|
| (7,431) |
|
| (7,431) |
Less: Restructuring costs |
|
| (2,300) |
|
| — |
|
|
|
|
| (2,300) |
Less: Depreciation, depletion and amortization |
|
| (22,415) |
|
| (18,551) |
|
| (246) |
|
| (41,212) |
Total operating costs |
|
| 266,199 |
|
| 134,111 |
|
| — |
|
| 400,310 |
Less: Other royalties |
|
| (16,773) |
|
| (6,400) |
|
| — |
|
| (23,173) |
Less: Stanwell rebate |
|
| (15,076) |
|
| — |
|
| — |
|
| (15,076) |
Less: Freight expenses |
|
| (38,955) |
|
| (16,951) |
|
| — |
|
| (55,906) |
Less: Other non-mining costs |
|
| (19,635) |
|
| (1,623) |
|
| — |
|
| (21,258) |
Total mining costs |
|
| 175,760 |
|
| 109,137 |
|
| — |
|
| 284,897 |
Sales Volume excluding non-produced coal (MMt) |
|
| 2.6 |
|
| 1.7 |
|
| — |
|
| 4.3 |
Mining cost per Mt sold ($/Mt) |
|
| 66.8 |
|
| 65.4 |
|
| — |
|
| 66.2 |
Average realized Met price per Mt sold for the three months ended June 30, 2022 compared to three months ended June 30, 2021
|
| Three months ended June 30, | ||||||
|
| 2022 |
| 2021 |
| Change |
| % |
|
| (in US$ thousands) | ||||||
Met sales volume (MMt) |
| 3.1 |
| 3.7 |
| (0.6) |
| (16.6)% |
Met coal revenues ($) |
| 994,203 |
| 390,131 |
| 604,072 |
| 154.8% |
Average realized Met price per Mt sold ($/Mt) |
| 321.2 |
| 105.1 |
| 216.1 |
| 205.6% |
Coronado Global Resources Inc. Form 10-Q June 30, 202230
SixThree months ended JuneSeptember 30,
Australia
|
| Six months ended June 30, | ||||||
|
| 2022 |
| 2021 |
| Change |
| % |
|
| (in US$ thousands) | ||||||
Sales volume (MMt) |
| 5.1 |
| 5.7 |
| (0.6) |
| (11.0)% |
Total revenues ($) |
| 1,183,686 |
| 489,726 |
| 693,960 |
| 141.7% |
Coal revenues ($) |
| 1,164,644 |
| 472,199 |
| 692,445 |
| 146.6% |
Average realized price per Mt sold ($/Mt) |
| 227.9 |
| 82.3 |
| 145.6 |
| 177.0% |
Met sales volume (MMt) |
| 3.3 |
| 4.3 |
| (1.0) |
| (22.5)% |
Met coal revenues ($) |
| 1,097,353 |
| 428,110 |
| 669,243 |
| 156.3% |
Average realized Met price per Mt sold ($/Mt) |
| 329.4 |
| 99.6 |
| 229.8 |
| 230.7% |
Mining costs ($) |
| 407,291 |
| 354,731 |
| 52,560 |
| 14.8% |
Mining cost per Mt sold ($/Mt) |
| 84.1 |
| 64.8 |
| 19.3 |
| 29.8% |
Operating costs ($) |
| 747,616 |
| 526,055 |
| 221,561 |
| 42.1% |
Operating costs per Mt sold ($/Mt) |
| 146.3 |
| 91.6 |
| 54.7 |
| 59.6% |
Segment Adjusted EBITDA ($) |
| 435,284 |
| (36,937) |
| 472,221 |
| (1,278.4)% |
Coal
Operating($/Mt)
For the six months ended June 30, 2022,
United States
|
| Six months ended June 30, | ||||||
|
| 2022 |
| 2021 |
| Change |
| % |
|
| (in US$ thousands) | ||||||
Sales volume (MMt) |
| 3.2 |
| 3.2 |
| — |
| 0.3% |
Total revenues ($) |
| 796,143 |
| 310,641 |
| 485,502 |
| 156.3% |
Coal revenues ($) |
| 792,981 |
| 308,767 |
| 484,214 |
| 156.8% |
Average realized price per Mt sold ($/Mt) |
| 250.5 |
| 97.9 |
| 152.6 |
| 155.9% |
Met sales volume (MMt) |
| 3.1 |
| 3.1 |
| — |
| 1.8% |
Met coal revenues ($) |
| 788,579 |
| 305,456 |
| 483,123 |
| 158.2% |
Average realized Met price per Mt sold ($/Mt) |
| 253.5 |
| 100.0 |
| 153.5 |
| 153.5% |
Mining costs ($) |
| 264,183 |
| 198,347 |
| 65,836 |
| 33.2% |
Mining cost per Mt sold ($/Mt) |
| 86.9 |
| 63.2 |
| 23.7 |
| 37.6% |
Operating costs ($) |
| 365,602 |
| 237,265 |
| 128,337 |
| 54.1% |
Operating costs per Mt sold ($/Mt) |
| 115.5 |
| 75.2 |
| 40.3 |
| 53.6% |
Segment Adjusted EBITDA ($) |
| 432,294 |
| 75,963 |
| 356,331 |
| 469.1% |
United States
|
| Six months ended June 30, | ||||||||||
|
|
| 2022 |
|
| 2021 |
|
| Change |
|
| % |
|
| (in US$ thousands) | ||||||||||
Selling, general, and administrative expenses |
| $ | 18,252 |
| $ | 13,206 |
| $ | 5,046 |
|
| 38.2% |
Other, net |
|
| (21) |
|
| 118 |
|
| (139) |
|
| (117.8)% |
Total Corporate and Other Adjusted EBITDA |
| $ | 18,231 |
| $ | 13,324 |
| $ | 4,907 |
|
| 36.8% |
Mining andoperating costsfor the SixNine monthsended June September30, 2022compared to SixNine months
|
| Six months ended June 30, 2022 | ||||||||||
|
| (in US$ thousands) | ||||||||||
|
|
| Australia |
|
| United States |
|
| Other / Corporate |
|
| Total Consolidated |
Total costs and expenses |
| $ | 794,901 |
| $ | 407,125 |
| $ | 18,837 |
| $ | 1,220,863 |
Less: Selling, general and administrative expense |
|
| — |
|
| — |
|
| (18,252) |
|
| (18,252) |
Less: Depreciation, depletion and amortization |
|
| (47,285) |
|
| (41,523) |
|
| (585) |
|
| (89,393) |
Total operating costs |
|
| 747,616 |
|
| 365,602 |
|
| — |
|
| 1,113,218 |
Less: Other royalties |
|
| (136,320) |
|
| (26,060) |
|
| — |
|
| (162,380) |
Less: Stanwell rebate |
|
| (69,585) |
|
| — |
|
| — |
|
| (69,585) |
Less: Freight expenses |
|
| (78,501) |
|
| (47,789) |
|
| — |
|
| (126,290) |
Less: Other non-mining costs |
|
| (55,919) |
|
| (27,570) |
|
| — |
|
| (83,489) |
Total mining costs |
|
| 407,291 |
|
| 264,183 |
|
| — |
|
| 671,474 |
Sales Volume excluding non-produced coal (MMt) |
|
| 4.8 |
|
| 3.0 |
|
| — |
|
| 7.9 |
Mining cost per Mt sold ($/Mt) |
|
| 84.1 |
|
| 86.9 |
|
| — |
|
| 85.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Six months ended June 30, 2021 | ||||||||||
|
| (in US$ thousands) | ||||||||||
|
|
| Australia |
|
| United States |
|
| Other / Corporate |
|
| Total Consolidated |
Total costs and expenses |
| $ | 578,657 |
| $ | 280,830 |
| $ | 13,632 |
| $ | 873,119 |
Less: Selling, general and administrative expense |
|
| — |
|
| — |
|
| (13,206) |
|
| (13,206) |
Less: Restructuring costs |
|
| (2,300) |
|
| — |
|
| — |
|
| (2,300) |
Less: Depreciation, depletion and amortization |
|
| (50,302) |
|
| (43,565) |
|
| (426) |
|
| (94,293) |
Total operating costs |
|
| 526,055 |
|
| 237,265 |
|
| — |
|
| 763,320 |
Less: Other royalties |
|
| (33,039) |
|
| (11,081) |
|
| — |
|
| (44,120) |
Less: Stanwell rebate |
|
| (30,895) |
|
| — |
|
| — |
|
| (30,895) |
Less: Freight expenses |
|
| (82,087) |
|
| (25,960) |
|
| — |
|
| (108,047) |
Less: Other non-mining costs |
|
| (25,303) |
|
| (1,877) |
|
| — |
|
| (27,180) |
Total mining costs |
|
| 354,731 |
|
| 198,347 |
|
| — |
|
| 553,078 |
Sales Volume excluding non-produced coal (MMt) |
|
| 5.5 |
|
| 3.1 |
|
| — |
|
| 8.6 |
Mining cost per Mt sold ($/Mt) |
|
| 64.8 |
|
| 63.2 |
|
| — |
|
| 64.2 |
Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three months ended June 30, |
| Six months ended June 30, | ||||||||
|
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
|
|
| (in US$ thousands) |
|
| (in US$ thousands) | ||||||
Reconciliation to Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
| $ | 291,995 |
| $ | (55,085) |
| $ | 561,893 |
| $ | (96,057) |
Add: Depreciation, depletion and amortization |
|
| 51,384 |
|
| 41,212 |
|
| 89,393 |
|
| 94,293 |
Add: Interest expense (net of income) |
|
| 17,482 |
|
| 16,596 |
|
| 34,814 |
|
| 31,731 |
Add: Other foreign exchange (gains) losses |
|
| (25,138) |
|
| 140 |
|
| (23,147) |
|
| 1,889 |
Add: Loss on extinguishment of debt |
|
| — |
|
| 5,744 |
|
| — |
|
| 5,744 |
Add: Income tax expense (benefit) |
|
| 102,025 |
|
| 8,184 |
|
| 183,968 |
|
| (10,884) |
Add: Restructuring costs |
|
| — |
|
| 2,300 |
|
| — |
|
| 2,300 |
Add: Losses on idled assets held for sale |
|
| 456 |
|
| 836 |
|
| 1,842 |
|
| 2,330 |
Add: Increase (decrease) in provision for discounting and credit losses |
|
| 156 |
|
| (1,866) |
|
| 584 |
|
| (5,644) |
Adjusted EBITDA |
| $ | 438,360 |
| $ | 18,061 |
| $ | 849,347 |
| $ | 25,702 |
Liquidity as of June 30, 2022 and December 31, 2021 was as follows:
|
|
| June 30, 2022 |
|
| December 31, 2021 |
|
|
| (in US$ thousands) | |||
Cash, excluding restricted cash |
| $ | 485,632 |
| $ | 437,679 |
Availability under ABL Facility (1) |
|
| 100,000 |
|
| 100,000 |
Total |
| $ | 585,632 |
| $ | 537,679 |
(1)The ABL Facility contains a springing fixed charge coverage ratio of not less than 1.00 to 1.00, which ratio is tested if availability under the ABL facility is less than $17.5 million for five consecutive business days or less than $15.0 million on any business day.
Coronado Global Resources Inc. Form 10-Q June 30, 202234
Our total indebtedness as of June 30, 2022 and December 31, 2021 consisted of the following:
|
|
| June 30, 2022 |
|
| December 31, 2021 |
|
|
| (in US$ thousands) | |||
Current installments of interest bearing liabilities |
| $ | 314,453 |
| $ | 315,000 |
Current installments of other financial liabilities and finance lease obligations |
|
| 4,042 |
|
| 8,634 |
Other financial liabilities and finance lease obligations, excluding current installments |
|
| 11,268 |
|
| 14,031 |
Total |
| $ | 329,763 |
| $ | 337,665 |
Liquidity
As of June 30, 2022, available liquidity was $585.6million, comprising of cash and cash equivalents (excluding restricted cash) of $485.6million and $100.0 million of available borrowings under our ABL Facility.
As of December 31, 2021, available liquidity was $537.7 million, comprising cash and cash equivalents (excluding restricted cash) of $437.7 million and $100.0 million of available borrowings under our ABL Facility.
Cash
Cash is held in multicurrency interest bearing bank accounts available to be used to service the working capital needs of the Company. Cash balances surplus to immediate working capital requirements are invested in short-term interest-bearing deposit accounts or used to repay interest bearing liabilities.
Senior Secured Notes
As of June 30, 2022, the outstanding amount of our Notes was $314.5 million. Interest on the Notes is payable semi-annually in arrears on May 15 and November 15 of each year. The Notes mature on May 15, 2026 and are senior secured obligations of the Company.
The Notes are guaranteed on a senior secured basis by the Company and its wholly-owned subsidiaries (other than the Issuer) (subject to certain exceptions and permitted liens) and secured by (i) a first-priority lien on substantially all of the Company’s assets and the assets of the other guarantors (other than accounts receivable and other rights to payment, inventory, intercompany indebtedness, certain general intangibles and commercial tort claims, commodities accounts, deposit accounts, securities accounts and other related assets and proceeds and products of each of the foregoing, or, collectively, the ABL Collateral), or the Notes Collateral, and (ii) a second-priority lien on the ABL Collateral, which is junior to a first-priority lien, for the benefit of the lenders under the ABL Facility.
The terms of the Notes are governed by the Indenture. The Indenture contains customary covenants for high yield bonds, including, but not limited to, limitations on investments, liens, indebtedness, asset sales, transactions with affiliates and restricted payments, including payment of dividends on capital stock.
The Company may redeem any of the Notes beginning on May 15, 2023. The initial redemption price of the Notes is 108.063% of their principal amount, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. The redemption price will decline each year after May 15, 2023, and will be 100% of the principal amount of the Notes, plus accrued and unpaid interest, beginning on May 15, 2025. The Company may also redeem some or all of the Notes at any time and from time to time prior to May 15, 2023 at a price equal to 100% of the principal amount thereof plus a “make-whole” premium, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. The Company may also redeem a portion of the Notes under certain circumstances prior to May 15, 2023.
For the three and the six months ended June 30, 2022, in connection with the dividends paid in the period, the Company offered to purchase up to a total of $200.6 million aggregate principal amount of the Notes pursuant to the terms of the Indenture. For the three and six months ended June 30, 2022, the Company purchased an aggregate principal amount, for accepted offers, of $0.5 million at a price equal to 104% of the principal amount of the Notes, plus accrued and unpaid interest on the Notes to, but not including, the date of redemption.
As of June 30, 2022, we were in compliance with all applicable covenants under the Indenture.
Coronado Global Resources Inc. Form 10-Q June 30, 202235
ABL Facility
The ABL Facility, dated May 12, 2021, is for an aggregate multi-currency lender commitment of up to $100.0 million, including a $30.0 million sublimit for the issuance of letters of credit and $5.0 million for swingline loans, at any time outstanding, subject to borrowing base availability. The ABL Facility will mature on May 12, 2024. Borrowings under the ABL Facility bear interest at a rate equal to a BBSY rate plus an applicable margin. As at June 30, 2022, no amounts were drawn and no letters of credit were outstanding under the ABL Facility.
As of June 30, 2022, we were in compliance with all applicable covenants under the ABL Facility.
Bank Guarantees and Surety Bonds
We are required to provide financial assurances and securities to satisfy contractual and other requirements generated in the normal course of business. Some of these assurances are provided to comply with state or other government agencies’ statutes and regulations. As of June 30, 2022, we had outstanding bank guarantees of $45.3 million to secure various obligations and commitments. The Company provided cash, in the form of deposits, as collateral against these bank guarantees.
For the U.S. Operations, in order to provide the required financial assurance, we generally use surety bonds for post-mining reclamation. We can also use bank letters of credit to collateralize certain obligations. As of June 30, 2022, we had outstanding surety bonds of $27.8 million and letters of credit of $16.8 million issued from our available bank guarantees, to secure various obligations and commitments. Future regulatory changes relating to these obligations could result in increased obligations, additional costs or additional collateral requirements.
Dividend
On February 24, 2022, our Board of Directors declared an unfranked ordinary dividend of 9.0 cents per CDI (USD). The dividend had a record date of March 18, 2022 and was paid on April 8, 2022.
On April 26, 2022, we amended our dividend policy with plans to pay a fixed cash dividend of 0.5 cent per CDI biannually (1.0 cent per CDI annually), in accordance with our over-arching distribution policy. The payment of dividends remains at the discretion of our Board of Directors.
On May 9, 2022, our Board of Directors declared a special unfranked dividend of $99.5 million, or 5.9 cents per CDI, reflecting the unaccepted portion of the offer to purchase the Notes made in connection with the dividend declared on February 24, 2022, and a special unfranked dividend of $100.6 million, or 6.0 cents per CDI. The dividend had a record date of May 31, 2022 and was paid on June 21, 2022.
On August 8, 2022, the Company’s Board of Directors declared a total unfranked ordinary dividend of $125.7 million, or 7.5 cents per CDI, comprising $100.6 million of the unaccepted portion of the offer to purchase the Notes made in connection with the special dividends declared on May 9, 2022, plus an additional $25.2 million. CDIs will be quoted as “ex” dividend on August 29, 2022, Australia time. The dividends will have a record date of August 30, 2022, Australia time, and be payable on September 20, 2022, Australia time. The total ordinary dividends of $125.7 million will be funded from available cash.
In connection with the declared ordinary dividends, Coronado Finance Pty Ltd, a wholly-owned subsidiary of the Company offered to purchase up to $25.2 million aggregate principal amount of the Notes, plus accrued and unpaid interest to, but excluding, the settlement date, at a purchase price equal to 104% of the principal amount of the Notes pursuant to the terms of the Indenture. The payment of the ordinary dividends is not contingent on acceptance of the offer to purchase the Notes by the Note holders.
Capital Requirements
Our main uses of cash have historically been the funding of our operations, working capital, capital expenditure, the payment of interest and dividends. We intend to use cash to fund debt service payments on our Notes, the ABL Facility and our other indebtedness, to fund operating activities, working capital, capital expenditures, partial redemption of the Notes, business or assets acquisitions and, if declared, payment of dividends.
Coronado Global Resources Inc. Form 10-Q June 30, 202236
Historical Cash Flows
The following table summarizes our cash flows for the three months ended June 30, 2022 and 2021, as reported in the accompanying consolidated financial statements:
Cash Flow
|
| Three months ended June 30, | ||||
|
|
| 2022 |
|
| 2021 |
|
| (in US$ thousands) | ||||
Net cash provided by operating activities |
| $ | 518,292 |
| $ | 56,924 |
Net cash used in investing activities |
|
| (93,520) |
|
| (122,923) |
Net cash (used in) provided by financing activities |
|
| (355,591) |
|
| 128,709 |
Net change in cash and cash equivalents |
|
| 69,181 |
|
| 62,710 |
Effect of exchange rate changes on cash and restricted cash |
|
| (21,228) |
|
| 5,215 |
Cash and restricted cash at beginning of period |
|
| 437,931 |
|
| 45,736 |
Cash and restricted cash at end of period |
| $ | 485,884 |
| $ | 113,661 |
Operating activities
Net cash provided by operating activities was $518.3 million for the six months ended June 30, 2022, compared to $56.9 million for the six months ended June 30, 2021. The increase was driven by higher coal revenues due to increase in the average realized Met coal pricing partially offset by higher operating costs and unfavorable working capital movement, mainly in trade receivables.
Investing activities
Net cash used in investing activities was $93.5million for the six months ended June 30, 2022, compared to $122.9 million for the six months ended June 30, 2021. Cash spent on capital expenditures for the six months ended June 30, 2022 was $87.9 million, of which $36.5 million related to the Australian Operations,$51.1 million related to the U.S. Operations and the remaining $0.3 million for other and corporate. During the six months ended June 30, 2022, a net of $3.5 million of additional deposits were provided as collateral for our U.S. workers compensation obligations and $2.4 million of additional security deposit was provided by our Australian Operations to satisfy contractual requirements generated in the normal course of business.
Financing activities
Net cash used in financing activities was $355.6million for the six months ended June 30, 2022, compared to cash provided by financing activities of $128.7 million for the six months ended June 30, 2021. The net cash used in financing activities for the six months ended June 30, 2022, included dividend payments of $348.4, net of a $2.4 million foreign exchange gain on settlement of dividends elected by shareholders to be paid in Australian dollars and the remainder related to repayment of borrowings.
Included in the net cash used in financing activities for the six months ended June 30, 2021, were net proceeds from borrowings of $396.4 million, repayment of borrowings of $365.4 million and net proceeds from the stock issuance of $97.7 million.
Contractual Obligations
There were no material changes to our contractual obligations from the information previously provided in Item 7. “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC and ASX on February 22, 2022.
Ourcriticalaccountingpoliciesare discussedinItem7. “Management’sDiscussionandAnalysisof Financial
ITEM 3.Quantitative and Qualitative Disclosures About Market Risk
QUANTITATIVEAND QUALITATIVEDISCLOSURES ABOUT MARKET RISK
Interest Rate Risk
item 4. Controls and Procedures
Disclosure Controls and Procedures
PART II – OTHERINFORMATION
item 1. lEGALLEGAL PROCEEDINGS
ITEM 1A.RISK FACTORS
Federal, state or local governmental authorities in nearly all countries across the global coal mining industry impose various forms of taxation on coalproducers,including productiontaxes,sales-relatedtaxes,royalties,
The new tiers applicable positionand the estimatedaccrual of $28.0million (A$43.0 million)within “Accrued Expensesand
7% for average coal price per Mt sold up to and including A$100 per Mt;
12.5% for average coal price per Mt sold from A$100 to A$150 per Mt;
15% for average coal price per Mt sold from A$150 to A$175 per Mt;
20% for average coal price per Mt sold from A$175 to A$225 per Mt;
30% for average coal price per Mt sold from A$225 to A$300 per Mt; and
40% for average coal price per Mt sold above A$300 per Mt.
itemamountassessedbytheQROandunpaidtaxinterestontheamountoutstandingwillbecomedueand
None.
None.
item 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Resources Inc.
ITEM 5.OTHER INFORMATION
None.
ITEM 6.EXHIBITS
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___________________________
SIGNATURES
Pursuant to the requirementsof the Securities ExchangeAct of 1934, the registranthas duly caused thisreport
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Date: August 8, 2022
Coronado Global Resources Inc. Form 10-Q June 30,