CONSOL Energy Announces Results for the First Quarter 2024
First Quarter 2024 Highlights Include:
-
GAAP net income of
$101.9 million and GAAP dilutive earnings per share of$3.39 ; -
Quarterly adjusted EBITDA1 of
$181.8 million ; -
Net cash provided by operating activities of
$77.5 million ; -
Quarterly free cash flow1 of
$41.3 million , which was impacted by working capital changes; -
Total revenue and other income of
$565.0 million ; -
Pennsylvania Mining Complex (PAMC) produced 6.5 million tons, despite three longwall moves; -
Itmann Mining Complex sold 193 thousand tons compared to 159 thousand tons during 4Q23; - 89% of 1Q24 free cash flow1 returned to shareholders via stock repurchases;
- PAMC contracted position of 22.9 million tons in 2024 and 13.5 million tons in 2025; and
-
Itmann Mining Complex improved its contracted position to 717 thousand tons in 2024.
Management Comments
"During the first quarter of 2024, the CONSOL team delivered a very strong operational performance despite some timing related headwinds coming into the quarter," said
"On the safety front, our Itmann Preparation Plant had ZERO employee recordable incidents in the first quarter of 2024. Our 1Q24 employee total recordable incident rate across our coal mining segment remained well below the historical national average for underground bituminous coal mines."
Pennsylvania Mining Complex Review and Outlook
|
|
Three Months Ended |
||
|
|
|
|
|
Total Coal Revenue (PAMC Segment) |
thousands |
$ 416,187 |
|
$ 563,337 |
Operating and Other Costs |
thousands |
$ 293,430 |
|
$ 260,627 |
Total Cash Cost of Coal Sold 1 |
thousands |
$ 242,436 |
|
$ 222,141 |
Coal Production |
million tons |
6.5 |
|
7.0 |
Coal Sales |
million tons |
6.1 |
|
6.7 |
Average Coal Revenue per Ton Sold |
per ton |
$ 68.33 |
|
$ 84.32 |
Average Cash Cost of Coal Sold per Ton 1 |
per ton |
$ 40.29 |
|
$ 33.61 |
Average Cash Margin per Ton Sold 1 |
per ton |
$ 28.04 |
|
$ 50.71 |
PAMC Sales and Marketing
CEIX sold 6.1 million tons of PAMC coal during the first quarter of 2024, generating coal revenue of
On the marketing front, after a modest rebound in the fourth quarter of 2023, demand for our product in the power generation markets was muted during the first quarter due to mild winter weather, which caused lower commodity prices. Domestically,
On the contracted front, the PAMC has 22.9 million tons contracted for 2024 and 13.5 million tons contracted for 2025.
Operations Summary
During the first quarter of 2024, we produced 6.5 million tons at the
Total coal revenue for the PAMC segment during the first quarter of 2024 was
CONSOL Marine Terminal Review
For the first quarter of 2024, throughput volume at the CMT was 4.5 million tons, compared to 4.6 million tons in the year-ago period. As previously mentioned, the bridge collapse blocked vessel access to our Terminal and caused inventory to build, thus limiting export shipments at the end of March. Terminal revenues and CMT total costs and expenses were
Itmann Update
Shareholder Returns Update
With the free cash flow1 generated during the first quarter of 2024, CEIX repurchased 440 thousand shares of its common stock for
Baltimore Bridge Update
As widely reported, vessel access to our
2024 Guidance and Outlook
Based on our current contracted position, estimated prices, and production plans and considering our current expectations regarding the impacts of the
- PAMC coal sales volume of 24.0-26.0 million tons
-
PAMC average coal revenue per ton sold expectation of
$62.50-$66.50 -
PAMC average cash cost of coal sold per ton2 expectation of
$37.50-$39.50 -
Itmann Mining Complex coal sales volume of 700-900 thousand tons -
Total capital expenditures:
$155-$180 million
First Quarter Earnings Conference Call
A conference call and webcast, during which management will discuss the first quarter 2024 financial and operational results, is scheduled for
Participant dial in (toll free) 1-800-836-8184
Participant international dial in 1-646-357-8785
Availability of Additional Information
Please refer to our website, www.consolenergy.com, for additional information regarding the company. In addition, we may provide other information about the company from time to time on our website.
We will also file our Form 10-Q with the
Footnotes:
1 "Adjusted EBITDA", "Free Cash Flow", "CONSOL Marine Terminal Adjusted EBITDA", "CMT Operating Cash Costs", "Total Recurring Revenues and Other Income" and "Total Cash Cost of Coal Sold" are non-GAAP financial measures and "Average Cash Cost of Coal Sold per Ton" and "Average Cash Margin per Ton Sold" are operating ratios derived from non-GAAP financial measures, each of which are reconciled to the most directly comparable GAAP financial measures below, under the caption "Reconciliation of Non-GAAP Financial Measures".
2 CEIX is unable to provide a reconciliation of PAMC Average Cash Cost of Coal Sold per Ton and Itmann Mining Complex Average Cash Cost of Coal Sold per Ton guidance, which are operating ratios derived from non-GAAP financial measures, due to the unknown effect, timing and potential significance of certain income statement items.
About
Contacts:
Investor:
nathantucker@consolenergy.com
Media:
ericafisher@consolenergy.com
Condensed Consolidated Statements of Cash Flows
The following table presents the condensed consolidated statements of cash flows for the three months ended
|
Three Months Ended
|
||
|
2024 |
|
2023 |
Cash Flows from Operating Activities: |
(Unaudited) |
|
(Unaudited) |
Net Income |
$ 101,891 |
|
$ 230,377 |
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: |
|
|
|
Depreciation, Depletion and Amortization |
56,997 |
|
59,551 |
Other Non-Cash Adjustments to Net Income |
(724) |
|
2,338 |
Changes in Working Capital |
(80,680) |
|
(43,755) |
Net Cash Provided by Operating Activities |
77,484 |
|
248,511 |
Cash Flows from Investing Activities: |
|
|
|
Capital Expenditures |
(42,352) |
|
(33,757) |
Proceeds from Sales of Assets |
6,191 |
|
6,000 |
Other Investing Activity |
(136) |
|
(75,000) |
|
(36,297) |
|
(102,757) |
Cash Flows from Financing Activities: |
|
|
|
Net Payments on Long-Term Debt, Including Fees |
(3,663) |
|
(98,372) |
Repurchases of Common Stock |
(57,881) |
|
(75,121) |
Dividends and Dividend Equivalents Paid |
(582) |
|
(38,287) |
Other Financing Activities |
(5,551) |
|
(14,083) |
|
(67,677) |
|
(225,863) |
|
(26,490) |
|
(80,109) |
Cash and Cash Equivalents and Restricted Cash at Beginning of Period |
243,268 |
|
326,952 |
Cash and Cash Equivalents and Restricted Cash at End of Period |
$ 216,778 |
|
$ 246,843 |
Reconciliation of Non-GAAP Financial Measures
We evaluate our cost of coal sold and cash cost of coal sold on an aggregate basis by segment, and our average cash cost of coal sold per ton on a per-ton basis. Cost of coal sold includes items such as direct operating costs, royalty and production taxes, direct administration costs, and depreciation, depletion and amortization costs on production assets. Cost of coal sold excludes any indirect costs and other costs not directly attributable to the production of coal. The cash cost of coal sold includes cost of coal sold less depreciation, depletion and amortization costs on production assets. We define average cash cost of coal sold per ton as cash cost of coal sold divided by tons sold. The GAAP measure most directly comparable to cost of coal sold, cash cost of coal sold and average cash cost of coal sold per ton is operating and other costs.
The following table presents a reconciliation for the PAMC segment of cash cost of coal sold, cost of coal sold and average cash cost of coal sold per ton to operating and other costs, the most directly comparable GAAP financial measure, on a historical basis, for each of the periods indicated (in thousands, except per ton information).
|
Three Months Ended
|
||
|
2024 |
|
2023 |
Operating and Other Costs |
$ 293,430 |
|
$ 260,627 |
Less: Other Costs (Non-Production and non-PAMC) |
(50,994) |
|
(38,486) |
Cash Cost of Coal Sold |
$ 242,436 |
|
$ 222,141 |
Add: Depreciation, Depletion and Amortization (PAMC Production) |
43,234 |
|
46,264 |
Cost of Coal Sold |
$ 285,670 |
|
$ 268,405 |
Total Tons Sold (in millions) |
6.1 |
|
6.7 |
Average Cost of Coal Sold per Ton |
$ 46.90 |
|
$ 40.18 |
Less: Depreciation, Depletion and Amortization Costs per Ton Sold |
6.61 |
|
6.57 |
Average Cash Cost of Coal Sold per Ton |
$ 40.29 |
|
$ 33.61 |
We evaluate our average cash margin per ton sold on a per-ton basis. We define average cash margin per ton sold as average coal revenue per ton sold, net of average cash cost of coal sold per ton. The GAAP measure most directly comparable to average cash margin per ton sold is total coal revenue.
The following table presents a reconciliation for the PAMC segment of average cash margin per ton sold to total coal revenue, the most directly comparable GAAP financial measure, on a historical basis, for each of the periods indicated (in thousands, except per ton information).
|
Three Months Ended
|
||
|
2024 |
|
2023 |
Total Coal Revenue (PAMC Segment) |
$ 416,187 |
|
$ 563,337 |
Operating and Other Costs |
293,430 |
|
260,627 |
Less: Other Costs (Non-Production and non-PAMC) |
(50,994) |
|
(38,486) |
Cash Cost of Coal Sold |
$ 242,436 |
|
$ 222,141 |
Total Tons Sold (in millions) |
6.1 |
|
6.7 |
Average Coal Revenue per Ton Sold |
$ 68.33 |
|
$ 84.32 |
Less: Average Cash Cost of Coal Sold per Ton |
40.29 |
|
33.61 |
Average Cash Margin per Ton Sold |
$ 28.04 |
|
$ 50.71 |
We define CMT operating costs as operating and other costs related to throughput tons. CMT operating costs exclude any indirect costs and other costs not directly attributable to throughput tons. CMT operating cash costs include CMT operating costs, less depreciation, depletion and amortization costs on throughput assets. The GAAP measure most directly comparable to CMT operating costs and CMT operating cash costs is operating and other costs.
The following table presents a reconciliation of CMT operating costs and CMT operating cash costs to operating and other costs, the most directly comparable GAAP financial measure, on a historical basis, for each of the periods indicated (in thousands).
|
Three Months Ended
|
||
|
2024 |
|
2023 |
Operating and Other Costs |
$ 293,430 |
|
$ 260,627 |
Less: Other Costs (Non-Throughput) |
(285,169) |
|
(253,646) |
CMT Operating Costs |
$ 8,261 |
|
$ 6,981 |
Less: Depreciation, Depletion and Amortization (Throughput) |
(1,092) |
|
(1,047) |
CMT Operating Cash Costs |
$ 7,169 |
|
$ 5,934 |
We define adjusted EBITDA as (i) net income (loss) plus income taxes, interest expense and depreciation, depletion and amortization, as adjusted for (ii) certain non-cash items, such as stock-based compensation and loss on debt extinguishment. The GAAP measure most directly comparable to adjusted EBITDA is net income (loss).
The following tables present a reconciliation of adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure, on a historical basis, for each of the periods indicated (in thousands).
|
Three Months Ended |
||||||
|
PAMC |
|
CONSOL |
|
Other |
|
Consolidated |
Net Income (Loss) |
$ 118,171 |
|
$ 13,831 |
|
$ (30,111) |
|
$ 101,891 |
|
|
|
|
|
|
|
|
Add: Income Tax Expense |
— |
|
— |
|
16,843 |
|
16,843 |
Add: Interest Expense |
— |
|
1,521 |
|
3,885 |
|
5,406 |
Less: Interest Income |
(1,293) |
|
— |
|
(3,209) |
|
(4,502) |
Earnings (Loss) Before Interest & Taxes (EBIT) |
116,878 |
|
15,352 |
|
(12,592) |
|
119,638 |
|
|
|
|
|
|
|
|
Add: Depreciation, Depletion & Amortization |
48,269 |
|
1,241 |
|
7,487 |
|
56,997 |
|
|
|
|
|
|
|
|
Earnings (Loss) Before Interest, Taxes and DD&A (EBITDA) |
$ 165,147 |
|
$ 16,593 |
|
$ (5,105) |
|
$ 176,635 |
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
Add: Stock-Based Compensation |
$ 4,186 |
|
$ 247 |
|
$ 685 |
|
$ 5,118 |
|
|
|
|
|
|
|
|
Adjusted EBITDA |
$ 169,333 |
|
$ 16,840 |
|
$ (4,420) |
|
$ 181,753 |
|
Three Months Ended |
||||||
|
PAMC |
|
CONSOL |
|
Other |
|
Consolidated |
Net Income (Loss) |
$ 276,276 |
|
$ 17,789 |
|
$ (63,688) |
|
$ 230,377 |
|
|
|
|
|
|
|
|
Add: Income Tax Expense |
— |
|
— |
|
41,593 |
|
41,593 |
Add: Interest Expense |
(301) |
|
1,526 |
|
9,054 |
|
10,279 |
Less: Interest Income |
(408) |
|
— |
|
(1,259) |
|
(1,667) |
Earnings (Loss) Before Interest & Taxes (EBIT) |
275,567 |
|
19,315 |
|
(14,300) |
|
280,582 |
|
|
|
|
|
|
|
|
Add: Depreciation, Depletion & Amortization |
51,371 |
|
1,156 |
|
7,024 |
|
59,551 |
|
|
|
|
|
|
|
|
Earnings (Loss) Before Interest, Taxes and DD&A (EBITDA) |
$ 326,938 |
|
$ 20,471 |
|
$ (7,276) |
|
$ 340,133 |
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
Add: Stock-Based Compensation |
$ 4,025 |
|
$ 144 |
|
$ 623 |
|
$ 4,792 |
Add: Loss on Debt Extinguishment |
— |
|
— |
|
1,375 |
|
1,375 |
Total Pre-tax Adjustments |
4,025 |
|
144 |
|
1,998 |
|
6,167 |
|
|
|
|
|
|
|
|
Adjusted EBITDA |
$ 330,963 |
|
$ 20,615 |
|
$ (5,278) |
|
$ 346,300 |
We define total recurring revenues and other income as total revenue and other income, less gains/losses on sales of assets. The GAAP measure most directly comparable to total recurring revenues and other income is total revenue and other income. The following table presents a reconciliation of total recurring revenues and other income to total revenue and other income, the most directly comparable GAAP financial measure, on a historical basis, for each of the periods indicated (in thousands).
|
Three Months Ended |
||
|
2024 |
|
2023 |
Total Revenue and Other Income |
$ 565,042 |
|
$ 688,607 |
Less: Gain on Sale of Assets |
(6,077) |
|
(5,726) |
Total Recurring Revenues and Other Income |
$ 558,965 |
|
$ 682,881 |
Free cash flow is a non-GAAP financial measure, defined as net cash provided by operating activities plus proceeds from sales of assets less capital expenditures and investments in mining-related activities. Management believes that this measure is meaningful to investors because management reviews cash flows generated from operations and non-core asset sales after taking into consideration capital expenditures due to the fact that these expenditures are considered necessary to maintain and expand CONSOL's asset base and are expected to generate future cash flows from operations. It is important to note that free cash flow does not represent the residual cash flow available for discretionary expenditures since other non-discretionary expenditures, such as mandatory debt service requirements, are not deducted from the measure. The following table presents a reconciliation of free cash flow to net cash provided by operations, the most directly comparable GAAP financial measure, on a historical basis, for each of the periods indicated (in thousands).
|
Three Months Ended |
|
Three Months Ended |
|
|
|
|
Net Cash Provided by Operations |
$ 77,484 |
|
$ 248,511 |
|
|
|
|
Capital Expenditures |
(42,352) |
|
(33,757) |
Proceeds from Sales of Assets |
6,191 |
|
6,000 |
Investments in Mining-Related Activities |
(23) |
|
— |
Free Cash Flow |
$ 41,300 |
|
$ 220,754 |
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release are "forward-looking statements" within the meaning of the federal securities laws. With the exception of historical matters, the matters discussed in this press release are forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended) that involve risks and uncertainties that could cause actual results to differ materially from results projected in or implied by such forward-looking statements. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The forward-looking statements may include projections and estimates concerning the timing and success of specific projects and our future production, revenues, income and capital spending. When we use the words "anticipate," "believe," "could," "continue," "estimate," "expect," "intend," "may," "plan," "predict," "project," "should," "target," "will," "would," or their negatives, or other similar expressions, the statements which include those words are usually forward-looking statements. When we describe our expectations with respect to the
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