Warrior Met Coal (HCC) Q1 2025 earnings summary

Executive summary

• Q1 2025 net loss of $8.2 million ($0.16 per diluted share), down from net income of $137 million ($2.62 per share) in Q1 2024, driven by a 40% year-over-year drop in steelmaking coal prices despite higher production and sales volumes.

• Adjusted EBITDA fell to $39.5 million (13% margin), down from $200 million (40% margin) year-over-year, reflecting weaker market conditions.

• Blue Creek project advanced on schedule and within budget, with $771.8 million invested to date, first sales expected mid-2025, and longwall startup by Q2 2026.

• Maintained strong liquidity at $616.6 million, including $454.9 million in cash and equivalents.

• Declared regular quarterly dividend of $0.08 per share.

Financial highlights

• Total revenues were $299.9 million, down 40% year-over-year, mainly due to a 42% drop in realized average net selling prices.

• Cash cost of sales per short ton decreased to $112.35 from $133.48 year-over-year.

• Free cash flow was negative $68.4 million, primarily due to $79.3 million in CapEx and mine development.

• Operating cash flow was $10.9 million, down from $104.1 million in Q1 2024.

• Depreciation and depletion expense increased to $45.3 million from $40.0 million year-over-year.

Outlook and guidance

• 2025 production guidance: 8.2–9.0 million short tons; sales guidance: 7.8–8.6 million short tons.

• Cash cost of sales (FOB port) guidance: $117–$127 per short ton; sustaining capex: $90–$100 million; Blue Creek capex: $225–$250 million.

• Guidance does not reflect potential impacts from recent tariff announcements; updates expected in Q2 2025.

• Premium LV coal prices expected to remain between $174 and $209 per metric ton for the remainder of 2025.

• Key factors affecting outlook: longwall moves, index pricing, trade/tariff policies, labor contract, inflation.