Warrior Met Coal (HCC) Q2 2025 earnings summary

Executive summary

• Achieved first commercial sales from Blue Creek mine ahead of schedule, contributing 239,000–348,000 short tons in Q2 2025 and accelerating longwall startup to early Q1 2026.

• Maintained strong operational execution, positive cash margins, and disciplined cost control despite a 24%–30% drop in steelmaking coal prices and challenging market conditions.

• Net income for Q2 2025 was $5.6 million ($0.11 per diluted share), down sharply from $70.7 million ($1.35 per share) in Q2 2024.

• Sales into Asia exceeded 50% of total volume for the first time, with no sales into China due to tariffs.

• Declared a regular quarterly cash dividend of $0.08 per share.

Financial highlights

• Q2 2025 revenues were $297.5 million, down from $396.5 million year-over-year, with average net selling price falling 30% to $130–$143/ton.

• Adjusted EBITDA was $53.6 million (18% margin), down from $115.9 million (29% margin) year-over-year.

• Cash cost of sales per ton was $101–$111, down 18% year-over-year.

• Free cash flow for Q2 2025 was negative $56.7 million, but underlying business generated ~$40 million excluding Blue Creek investments.

• Liquidity at quarter-end was $545 million, with no outstanding ABL borrowings.

Outlook and guidance

• 2025 sales guidance: 8.8–9.5 million short tons; production: 8.3–9.1 million short tons.

• Cash cost of sales expected at $110–$120 per ton; sustaining capex $90–$100 million; Blue Creek capex $225–$250 million.

• Blue Creek longwall startup accelerated to early Q1 2026; 2026 production could approach 3.6–4 million tons.

• Section 45X tax credit and new legislation could provide $30–$40 million per year benefit from 2026–2029.

• Key risks: trade/tariff policies, HCC index pricing, longwall moves, labor contracts, and inflation.