10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____________ to _____________

Commission File Number: 001-38061

Warrior Met Coal, Inc.

(Exact name of registrant as specified in its charter)

Delaware		81-0706839
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
16243 Highway 216
Brookwood	Alabama	35444
(Address of Principal Executive Offices)		(Zip Code)

(205) 554-6150

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $.01 per share	HCC	New York Stock Exchange
Rights to Purchase Series A Junior Participating Preferred Stock, par value $0.01 per share	--	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

Indicate by check mark whether the registrant 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 ý    No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	ý	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐    No ý

Number of shares of common stock outstanding as of April 29, 2024: 52,300,707

TABLE OF CONTENTS

Forward-Looking Statements		1
Part I. Financial Information		3
Item 1.	Financial Statements	3
	Condensed Statements of Operations for the three months ended March 31, 2024 (Unaudited) and March 31, 2023 (Unaudited)	4
	Condensed Balance Sheets as of March 31, 2024 (Unaudited) and December 31, 2023	5
	Condensed Statements of Cash Flows for the three months ended March 31, 2024 (Unaudited) and March 31, 2023	6
	Condensed Statements of Changes in Stockholders' Equity for the three months ended March 31, 2024 (Unaudited) and March 31, 2023 (Unaudited)	7
	Notes to Condensed Financial Statements	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30
Item 4.	Controls and Procedures	31
Part II. Other Information		32
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
Item 3.	Defaults on Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	34
Signatures		35

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this "Form 10-Q" or "this report") includes statements of our expectations, intentions, plans and beliefs that constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are intended to come within the safe harbor protection provided by those sections. These statements, which involve risks and uncertainties, relate to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable and may also relate to our future prospects, developments and business strategies, including any potential changes to our production and sales volumes as a result of our negotiations with the labor union representing certain of our hourly employees. We have used the words “anticipate,” “approximately,” “assume,” “believe,” “could,” “contemplate,” “continue,” “estimate,” “expect,” “target,” “future,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should” and similar terms and phrases, including in references to assumptions, in this report to identify forward-looking statements. These forward-looking statements are made based on expectations and beliefs concerning future events affecting us and are subject to uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control, that could cause our actual results to differ materially from those matters expressed in or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to:

•the impact of global pandemics, such as the COVID-19 pandemic, including the impact of any such pandemic on our business, employees, suppliers and customers, the metallurgical ("met") or steelmaking coal and steel industries, and global economic markets;

•the impacts of inflation on our business, including on our costs and our profitability;

•our relationships with, and other conditions affecting, our customers;

•successful implementation of our business strategies;

•unavailability of, or price increases in, the transportation of our met or steelmaking coal;

•significant cost increases and fluctuations, and delay in the delivery of raw materials, mining equipment and purchased components;

•work stoppages, negotiation of labor contracts, employee relations and workforce availability;

•competition and foreign currency fluctuations;

•litigation, including claims not yet asserted;

•terrorist attacks or security threats, including cybersecurity threats;

•global steel demand and the downstream impact on steelmaking coal prices;

•impact of weather and natural disasters on demand and production;

•a substantial or extended decline in pricing or demand for steelmaking coal;

•inherent difficulties and challenges in the coal mining industry that are beyond our control;

•our ability to develop or acquire steelmaking coal reserves in an economically feasible manner;

•geologic, equipment, permitting, site access, operational risks and new technologies related to mining;

•inaccuracies in our estimates of our steelmaking coal reserves;

•costs associated with our workers’ compensation benefits;

•challenges to our licenses, permits and other authorizations;

•challenges associated with environmental, health and safety laws and regulations;

1

•regulatory requirements associated with federal, state and local regulatory agencies, and such agencies’ authority to order temporary or permanent closure of our mines;

•climate change concerns and our operations’ impact on the environment;

•failure to obtain or renew surety bonds on acceptable terms, which could affect our ability to secure reclamation and coal lease obligations;

•our obligations surrounding reclamation and mine closure;

•our substantial indebtedness and debt service requirements;

•our ability to comply with covenants in our Second Amended and Restated Credit Facility (the “ABL Facility”) and the Indenture (as defined below);

•our ability to maintain adequate liquidity and the cost, availability and access to capital and financial markets;

•our expectations regarding our future cash tax rate as well as our ability to effectively utilize our federal and state net operating loss carry forwards (“NOLs”);

•our ability to continue paying our quarterly dividend or pay any special dividend;

•the timing and amount of any stock repurchases we make under our New Stock Repurchase Program (as defined below) or otherwise;

•any consequences related to our transfer restrictions under our certificate of incorporation and our NOL rights agreement;

•geopolitical events, including the effects of the Russia-Ukraine war and the ongoing conflict in the Middle East; and

•the inability to transport our products to customers due to rail performance issues or the impact of weather and mechanical failures at the McDuffie Terminal at the Port of Mobile in Alabama.

These forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Forward-looking statements should, therefore, be considered in light of various factors, including those set forth under “Part II, Item 1A. Risk Factors,” “Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Form 10-Q, and those set forth from time to time in our other filings with the Securities and Exchange Commission (the “SEC”). These documents are available through our website at www.warriormetcoal.com or through the SEC's Electronic Data Gathering and Analysis Retrieval system at http://www.sec.gov. In light of such risks and uncertainties, we caution you not to place undue reliance on these forward-looking statements.

When considering forward-looking statements made by us in this Form 10-Q, or elsewhere, such statements speak only as of the date on which we make them. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. We have no duty to, and do not intend to, update or revise the forward-looking statements in this Form 10-Q after the date of this Form 10-Q, except as may be required by law. In light of these risks and uncertainties, you should keep in mind that any forward-looking statement made in this Form 10-Q or elsewhere might not occur.

2

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

3

WARRIOR MET COAL, INC.

CONDENSED STATEMENTS OF OPERATIONS

(in thousands, except per-share amounts)

(Unaudited)

	For the three months ended March 31,
	2024		2023
Revenues:
Sales	$	497,998	$	500,491
Other revenues	5,514		9,183
Total revenues	503,512		509,674
Costs and expenses:
Cost of sales (exclusive of items shown separately below)	285,587		232,630
Cost of other revenues (exclusive of items shown separately below)	9,965		11,438
Depreciation and depletion	40,023		37,213
Selling, general and administrative	18,658		14,516
Business interruption	201		4,217
Total costs and expenses	354,434		300,014
Operating income	149,078		209,660
Interest expense	(1,121)		(7,443)
Interest income	8,154		8,903
Other income	—		221
Income before income tax expense	156,111		211,341
Income tax expense	19,122		29,064
Net income	$	136,989	$	182,277
Basic and diluted net income per share:
Net income per share—basic	$	2.63	$	3.52
Net income per share—diluted	$	2.62	$	3.51
Weighted average number of shares outstanding—basic	52,163		51,842
Weighted average number of shares outstanding—diluted	52,217		51,956
Dividends per share:	$	0.58	$	0.95

The accompanying notes are an integral part of these condensed financial statements.

4

WARRIOR MET COAL, INC.

CONDENSED BALANCE SHEETS

(in thousands, except share and per-share data)

	March 31, 2024		December 31, 2023
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	693,858	$	738,197
Short-term investments	9,149		9,030
Trade accounts receivable	213,400		98,225
Income tax receivable	—		7,833
Inventories, net	165,650		183,949
Prepaid expenses and other receivables	37,200		31,932
Total current assets	1,119,257		1,069,166
Mineral interests, net	78,428		80,442
Property, plant and equipment, net	1,253,395		1,179,609
Non-current income tax receivable	—		—
Deferred income taxes	5,752		5,854
Other long-term assets	21,759		21,987
Total assets	$	2,478,591	$	2,357,058
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	43,184	$	36,245
Accrued expenses	80,944		81,612
Asset retirement obligations	12,500		12,500
Short-term financing lease liabilities	11,357		11,463
Other current liabilities	15,057		5,850
Current portion of long-term debt	—		—
Total current liabilities	163,042		147,670
Long-term debt	153,166		153,023
Asset retirement obligations	71,916		71,666
Black Lung obligations	27,125		26,966
Long-term financing lease liabilities	7,708		8,756
Deferred income taxes	77,434		74,531
Other long-term liabilities	—		—
Total liabilities	500,391		482,612
Stockholders’ Equity:
Common stock, $0.01 par value, (140,000,000 shares authorized as of March 31, 2024 and December 31, 2023; 54,519,114 issued and 52,297,273 outstanding as of March 31, 2024; 54,240,764 issued and 52,018,923 outstanding as of December 31, 2023)	545		542
Preferred stock, $0.01 par value per share (10,000,000 shares authorized; no shares issued and outstanding)	—		—
Treasury stock, at cost (2,221,841 shares as of March 31, 2024 and December 31, 2023)	(50,576)		(50,576)
Additional paid in capital	276,731		279,332
Retained earnings	1,751,500		1,645,148
Total stockholders’ equity	1,978,200		1,874,446
Total liabilities and stockholders’ equity	$	2,478,591	$	2,357,058

The accompanying notes are an integral part of these condensed financial statements.

5

WARRIOR MET COAL, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

	For the three months ended March 31,
	2024		2023
OPERATING ACTIVITIES
Net income	$	136,989	$	182,277
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and depletion	40,023		37,213
Deferred income tax expense	2,909		29,064
Stock based compensation expense	9,152		7,702
Amortization of debt issuance costs and debt discount	393		713
Accretion of asset retirement obligations	1,297		906
Mark-to-market gain on gas hedges	—		(500)
Changes in operating assets and liabilities:
Trade accounts receivable	(115,175)		(56,804)
Income tax receivable	7,833		—
Inventories	16,162		17,406
Prepaid expenses and other receivables	(5,267)		(3,140)
Accounts payable	5,631		(8,463)
Accrued expenses and other current liabilities	5,046		(18,032)
Other	(935)		4,592
Net cash provided by operating activities	104,058		192,934
INVESTING ACTIVITIES
Purchase of property, plant and equipment	(99,703)		(68,179)
Deferred mine development costs	(1,987)		(14,458)
Acquisition of gas well ownership interest	—		(2,381)
Net cash used in investing activities	(101,690)		(85,018)
FINANCING ACTIVITIES
Dividends paid	(30,638)		(50,016)
Retirements of debt	—		(8,000)
Principal repayments of finance lease obligations	(4,292)		(7,634)
Payments for taxes related to net share settlement of equity awards	(11,777)		(9,198)
Net cash used in financing activities	(46,707)		(74,848)
Net (decrease) increase in cash and cash equivalents	(44,339)		33,068
Cash and cash equivalents at beginning of period	738,197		829,480
Cash and cash equivalents at end of period	$	693,858	$	862,548

The accompanying notes are an integral part of these condensed financial statements.

6

WARRIOR MET COAL, INC.

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(in thousands)

(Unaudited)

	For the three months ended March 31,
	2024		2023
Common Stock
Balance, beginning of period	$	542	$	539
Issuance of shares	3		—
Balance, end of period	545		539
Preferred Stock
Balance, beginning of period	—		—
Balance, end of period	—		—
Treasury Stock
Balance, beginning of period	(50,576)		(50,576)
Balance, end of period	(50,576)		(50,576)
Additional Paid in Capital
Balance, beginning of period	279,332		269,956
Stock based compensation expense	9,179		7,713
Tax withholdings on vested equity awards	(11,779)		(9,198)
Balance, end of period	276,732		268,471
Retained Earnings
Balance, beginning of period	1,645,148		1,227,596
Net income	136,989		182,277
Dividends paid	(30,638)		(50,016)
Balance, end of period	1,751,499		1,359,857
Total Stockholders' Equity	$	1,978,200	$	1,578,291

The accompanying notes are an integral part of these condensed financial statements.

7

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

Note 1. Business and Basis of Presentation

Description of the Business

Warrior Met Coal, Inc. (the "Company") is a U.S.-based, environmentally and socially minded supplier to the global steel industry. The Company is dedicated entirely to mining non-thermal met steelmaking coal used as a critical component of steel production by metal manufacturers in Europe, South America and Asia. The Company is a large-scale, low-cost producer and exporter of premium quality met coal, also known as hard-coking coal ("HCC"), operating highly efficient longwall operations in its underground mines based in Alabama. The HCC that the Company produces from the Blue Creek coal seam contains very low sulfur and has strong coking properties. The Company also generates ancillary revenues from the sale of natural gas extracted as a byproduct from the underground coal mines and royalty revenues from leased properties.

Basis of Presentation

The accompanying financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion, the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. For further information, refer to the financial statements and related notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Annual Report"). Operating results for the three months ended March 31, 2024 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2024. The balance sheet at December 31, 2023 has been derived from the audited financial statements for the year ended December 31, 2023 included in the 2023 Annual Report.

Collective Bargaining Agreement

The Company's Collective Bargaining Agreement ("CBA") with the labor union representing certain of the Company's hourly employees expired on April 1, 2021 and the labor union initiated a strike after an agreement on a new contract was not reached. As a result of the strike, the Company initially idled Mine No. 4 and scaled back operations at Mine No. 7. In the first quarter of 2022, the Company restarted operations at Mine No. 4. On February 16, 2023, the labor union representing certain of the Company's hourly employees announced that they were ending the strike and made an unconditional offer to return to work. The Company incurred business interruption expenses of approximately $0.2 million for the three months ended March 31, 2024, which represent ongoing legal expenses associated with ongoing labor negotiations. The Company incurred $4.2 million for the three months ended March 31, 2023, which represent non-recurring expenses that were directly attributable to the labor strike for incremental safety and security, labor negotiations and other expenses. These expenses are presented separately in the Condensed Statements of Operations. The Company continues to engage in good faith efforts with the labor union to reach an agreement on a new contract.

Acquisitions

On March 31, 2023, the Company acquired the remaining ownership interest in gas wells owned by an independent third party for $2.4 million. The purchase consideration was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The acquisition is not deemed to be material to the condensed financial statements.

Note 2. Summary of Significant Accounting Policies

The Company's significant accounting policies are consistent with those disclosed in Note 2 to its audited financial statements included in the 2023 Annual Report.

Use of Estimates

The Company prepares its financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Due to the inherent uncertainty involved in making estimates, actual results could differ from those estimates.

8

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

Cash and Cash Equivalents

Cash and cash equivalents include short-term deposits and highly liquid investments that have original maturities of three months or less when purchased and are stated at cost, which approximates fair value.

Short-Term Investments

Instruments with maturities greater than three months, but less than twelve months, are included in short-term investments. The Company also purchases fixed income securities and certificates of deposits with varying maturities that are classified as available for sale and are carried at fair value. Securities classified as held to maturity are those securities that management has the intent and ability to hold to maturity.

As of March 31, 2024 and December 31, 2023, short-term investments consisted of $9.1 million and $9.0 million in cash and fixed income securities. The short-term investments are posted as collateral for the self-insured black lung related claims asserted by or on behalf of former employees of Walter Energy, Inc. ("Walter Energy") and its subsidiaries, which were assumed by the Company and relate to periods prior to March 31, 2016.

Revenue Recognition

    Revenue is recognized when performance obligations under the terms of a contract with the Company's customers are satisfied; for all contracts this occurs when control of the promised goods have been transferred to the Company's customers and risk of loss passes such customers. For coal shipments to domestic customers via rail, control is transferred when the railcar is loaded. For coal shipments to international customers via ocean vessel, control is transferred when the vessel is loaded at the Port of Mobile in Alabama. Occasionally, the Company will sell coal stockpiles at the barge loadout or port upon which control, title and risk of loss transfers when stockpiles are segregated. For all steelmaking coal sales under average pricing contracts where pricing is not finalized when revenue is recognized, revenue is recorded based on estimated consideration to be received at the date of the sale. For natural gas sales, control is transferred when the gas has been transferred to the pipeline. Revenue is disaggregated between coal sales within the Company's mining segment and natural gas sales included in all other revenues, as disclosed in Note 12.

The Company's coal and gas sales generally include up to 45-day payment terms following the transfer of control of the goods to the customer. The Company typically does not include extended payment terms in its contracts with customers.

Trade Accounts Receivable and Allowance for Credit Losses

    Trade accounts receivable are stated at cost. Trade accounts receivable represent customer obligations that are derived from revenue recognized from contracts with customers. Credit is extended based on an evaluation of the individual customer's financial condition. The Company maintains trade credit insurance on the majority of its customers and the geographic regions of coal shipments to these customers. In some instances, the Company requires letters of credit, cash collateral or prepayments from its customers on or before shipment to mitigate the risk of loss. These efforts have consistently resulted in the Company recognizing no historical credit losses. The Company also has never had to have a claim against its trade credit insurance policy.

In order to estimate the allowance for credit losses on trade accounts receivable, the Company utilizes an aging approach in which potential impairment is calculated based on how long a receivable has been outstanding (e.g., current, 1-31 days, 31-60 days, etc.). The Company calculates an expected credit loss rate based on the Company’s historical credit loss rate, the risk characteristics of its customers, and the current steelmaking coal and steel market environments. As of March 31, 2024 and December 31, 2023, the estimated allowance for credit losses was immaterial and did not have a material impact on the Company's financial statements.

9

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

Note 3. Inventories, net

Inventories, net are summarized as follows (in thousands):

	March 31, 2024		December 31, 2023
Coal	$	110,438	$	129,989
Raw materials, parts, supplies and other, net	55,212		53,960
Total inventories, net	$	165,650	$	183,949

Note 4. Income Taxes

For the three months ended March 31, 2024 and 2023, the Company estimated its annual effective tax rate and applied this effective tax rate to its year-to-date pretax income at the end of the interim reporting period. The tax effect of unusual or infrequently occurring items, including the effects of changes in tax laws or rates and changes in judgment about the realizability of deferred tax assets, are reported in the interim period in which they occur. For the three months ended March 31, 2024 and 2023, the Company had income tax expense of $19.1 million and $29.1 million, respectively.

The $19.1 million and $29.1 million income tax expense for the three months ended March 31, 2024 and 2023, includes a benefit related to depletion and Internal Revenue Code ("IRC") Section 250 Deduction: Foreign-Derived Intangible Income ("FDII"). The Tax Cuts and Jobs Act ("TCJA") was enacted on December 22, 2017 and enacted IRC Section 250 Deduction: FDII, which provides for, among other things, a deduction of 37.5% with respect to foreign-derived intangible income, which reduces the statutory tax rate from 21% to 13.125%. Beginning in 2026, the deduction is reduced from 37.5% to 22.5% of foreign-derived intangible income. The Company has historically not been eligible to claim the deduction due to the deduction being limited to taxable income and the Company's ability to utilize its net operating losses to offset taxable income.

Note 5. Debt

The Company's debt consisted of the following (in thousands):

	March 31, 2024		December 31, 2023		Weighted Average Interest Rate	Final Maturity
Senior Secured Notes	$	156,517	$	156,517	7.875%	December 2028
ABL Borrowings	—		—		Varies(1)	December 2026
Debt discount	(3,351)		(3,494)
Total debt	153,166		153,023
Less: current debt	—		—
Total long-term debt	$	153,166	$	153,023

(1) Borrowings under the ABL Facility bear interest at a rate equal to Secured Overnight Financing Rate ("SOFR") ranging from 1.5% to 2.0%, plus a credit adjustment spread, ranging currently from 0.11448% to 0.42826%, or an alternate base rate plus an applicable margin, which is determined based on the average availability of the commitments under the ABL Facility, ranging from 0.5% to 1.0%.

10

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

Senior Secured Notes

On December 6, 2021, the Company issued $350.0 million in aggregate principal amount of 7.875% senior secured notes due 2028 (the “Notes”) at an initial price of 99.343% of their face amount. The Notes were issued to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to certain non-U.S. persons in transactions outside the United States in accordance with Regulation S under the Securities Act. The Company used the net proceeds of the offering of the Notes, together with cash on hand, to fund the redemption of all of the Company’s outstanding 8.00% senior secured notes due 2024 (the “Existing Notes”), including payment of the redemption premium in connection with such redemption. The Notes will mature on December 1, 2028.

During the three months ended March 31, 2023, the Company repurchased in the open market and extinguished approximately $8.0 million principal amount of our Notes. In connection with the extinguishment of our Notes, we recognized a loss on early extinguishment of debt of $0.1 million which is included in interest expense in the Condensed Statements of Operations.

ABL Facility

On December 6, 2021, the Company entered into the Second Amended and Restated Asset-Based Revolving Credit Agreement (the “Second Amended and Restated Credit Agreement”), by and among the Company and certain of its subsidiaries, as borrowers, the guarantors party thereto, the lenders from time to time party thereto and Citibank, as administrative agent (in such capacity, the "Agent"), which amends and restates in its entirety the then existing Amended and Restated Asset-Based Revolving Credit Agreement (as amended, the “ABL Facility”). The Second Amended and Restated Credit Agreement, among other things, (i) extended the maturity date of the ABL Facility to December 6, 2026; (ii) changed the calculation of the interest rate payable on borrowings from being based on a London Inter-Bank Offered Rate to be based on a SOFR, with corresponding changes to the applicable interest rate margins with respect to such borrowings, (iii) amended certain definitions related to the calculation of the borrowing base; (iv) increased the commitments that may be used to issue letters of credit to $65.0 million; and (v) amended certain baskets contained in the covenants to conform to the baskets contained in the indenture governing the Notes (the "Indenture"). The Second Amended and Restated Credit Agreement also allows the Company to borrow up to $116.0 million through November 2026, subject to availability under the borrowing base and other conditions.

As of March 31, 2024, no loans were outstanding under the ABL Facility and there were $8.7 million of letters of credit issued and outstanding under the ABL Facility. At March 31, 2024, the Company had $107.4 million of availability under the ABL Facility (calculated net of $8.7 million of letters of credit outstanding at such time).

Note 6. Leases

The Company primarily enters into rental agreements for certain mining equipment that are for periods of 12 months or less, some of which include options to extend the leases. Leases that are for periods of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense on these agreements on a straight-line basis over the lease term. Additionally, the Company has certain finance leases for mining equipment that expire over various contractual periods. These leases have remaining lease terms of one to five years and do not include an option to renew. Amortization expense for finance leases is included in depreciation and depletion expense.

11

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

Supplemental balance sheet information related to leases was as follows (in thousands):

	March 31, 2024			December 31, 2023
Finance lease right-of-use assets, net(1)	$	64,406		$	67,014
Finance lease liabilities
Current	11,357			11,463
Noncurrent	7,708			8,756
Total finance lease liabilities	$	19,065		$	20,219
Weighted average remaining lease term - finance leases (in months)	20.0			20.8
Weighted average discount rate - finance leases(2)	7.02		%	7.02		%

(1) Finance lease right-of-use assets are recorded net of accumulated amortization of $42.2 million and $38.5 million and are included in property, plant and equipment, net in the Condensed Balance Sheets as of March 31, 2024 and the Balance Sheets as of December 31, 2023, respectively.

(2) When an implicit discount rate is not readily available in a lease, the Company uses its incremental borrowing rate based on information available at the commencement date when determining the present value of lease payments.

The components of lease expense were as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Operating lease cost(1):	$	12,606	$	6,430
Finance lease cost:
Amortization of leased assets	5,758		5,280
Interest on lease liabilities	351		638
Net lease cost	$	18,715	$	12,348

(1) Includes leases that are for periods of 12 months or less.

Maturities of lease liabilities for the Company's finance leases as of March 31, 2024 were as follows (in thousands):

	Finance Leases(1)
2024	$	14,208
2025	4,598
2026	1,052
2027	—
Thereafter	—
Total	19,858
Less: amount representing interest	(793)
Present value of lease liabilities	$	19,065

(1) Finance lease payments include $3.0 million of future payments required under signed lease agreements that have not yet commenced.

12

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

Supplemental cash flow information related to the Company's leases was as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	351	$	638
Financing cash flows from finance leases	$	4,292	$	7,634
Non-cash right-of-use assets obtained in exchange for lease obligations:
Finance leases	$	3,138	$	2,158

Note 7. Net Income per Share

Basic and diluted net income per share was calculated as follows (in thousands, except per share data):

	For the three months ended March 31,
	2024		2023
Numerator:
Net income	$	136,989	$	182,277
Denominator:
Weighted-average shares used to compute net income per share—basic	52,163		51,842
Dilutive restrictive stock awards	54		114
Weighted-average shares used to compute net income per share—diluted	52,217		51,956
Net income per share—basic	$	2.63	$	3.52
Net income per share—diluted	$	2.62	$	3.51

Note 8. Commitments and Contingencies

Environmental Matters

The Company is subject to a wide variety of laws and regulations concerning the protection of the environment, both with respect to the construction and operation of its plants, mines and other facilities and with respect to remediating environmental conditions that may exist at its own and other properties.

The Company believes it is in compliance with federal, state and local environmental laws and regulations. The Company accrues for environmental expenses resulting from existing conditions that relate to past operations when the costs are probable and can be reasonably estimated. As of March 31, 2024 and December 31, 2023, there were no accruals for environmental matters other than asset retirement obligations for mine reclamation.

Miscellaneous Litigation

From time to time, the Company is party to lawsuits arising in the ordinary course of business. The Company records costs relating to these matters when a loss is probable and the amount can be reasonably estimated. The effect of the outcome of these matters on the Company’s future results of operations cannot be predicted with certainty as any such effect depends on future results of operations and the amount and timing of the resolution of such matters. As of March 31, 2024 and December 31, 2023, there were no items accrued for miscellaneous litigation.

On July 15, 2015, Walter Energy and certain of its wholly owned U.S. subsidiaries, including Jim Walter Resources, Inc. (“JWR”) filed voluntary petitions for relief under chapter 11 of title 11 of the U.S. Bankruptcy Code (the “Chapter 11 Cases”) in the Northern District of Alabama, Southern Division. On December 7, 2015, Walter Energy Canada Holdings, Inc., Walter Canadian Coal Partnership and their Canadian affiliates (collectively “Walter Canada”) applied for and were granted protection under the Companies’ Creditors Arrangement Act (the “CCAA”) pursuant to an Initial Order of the Supreme Court

13

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

of British Columbia. As a result of the Company’s acquisition of certain core operating assets of Walter Energy during the Chapter 11 Cases, in the first quarter of 2023 the Company received $0.2 million from the Chapter 11 Cases which is reflected as other income in the Condensed Statement of Operations.

Other Commitments and Contingencies

The Company is party to various transportation and throughput agreements with rail and barge transportation providers and the Alabama State Port Authority. These agreements contain annual minimum tonnage guarantees with respect to coal transported from the mine sites to the Port of Mobile, Alabama, the unloading of rail cars or barges, and the loading of vessels. If the Company does not meet its minimum throughput obligations, which are based on annual minimum amounts, it is required to pay the transportation providers or the Alabama State Port Authority a contractually specified amount per metric ton for the difference between the actual throughput and the minimum throughput requirement. At March 31, 2024 and December 31, 2023, the Company had no liability recorded for minimum throughput requirements.

Royalty Obligations

A substantial amount of the coal that the Company mines is produced from mineral reserves leased from third-party landowners. These leases convey mining rights to the Company in exchange for royalties to be paid to the landowner as either a fixed amount per ton or as a percentage of the sales price. Although coal leases have varying renewal terms and conditions, they generally last for the economic life of the reserves. Coal royalty expenses were $42.9 million and $33.2 million for the three months ended March 31, 2024 and 2023, respectively.

Note 9. Stockholders' Equity

Common Shares

The Company is authorized to issue up to 140,000,000 common shares, $0.01 par value per share. Holders of common shares are entitled to receive dividends when authorized by the Board.

Stock Repurchase Program

On March 26, 2019, the Board approved the Company's second stock repurchase program (the “New Stock Repurchase Program”) that authorizes repurchases of up to an aggregate of $70.0 million of the Company's outstanding common stock. The Company fully exhausted its previous stock repurchase program (the "First Stock Repurchase Program") of $40.0 million of its outstanding common stock. The New Stock Repurchase Program does not require the Company to repurchase a specific number of shares or have an expiration date. The New Stock Repurchase Program may be suspended or discontinued by the Board at any time without prior notice.

    Under the New Stock Repurchase Program, the Company may repurchase shares of its common stock from time to time, in amounts, at prices and at such times as the Company deems appropriate, subject to market and industry conditions, share price, regulatory requirements and other considerations as determined from time to time by the Company. The Company’s repurchases may be executed using open market purchases or privately negotiated transactions in accordance with applicable securities laws and regulations, including Rule 10b-18 of the Exchange Act and repurchases may be executed pursuant to Rule 10b5-1 under the Exchange Act. Repurchases will be subject to limitations in the ABL Facility and the Indenture. The Company intends to fund repurchases under the New Stock Repurchase Program from cash on hand and/or other sources of liquidity. Any future repurchases of shares of the Company's common stock will be subject to the 1% excise tax under the Inflation Reduction Act.

As of March 31, 2024 and December 31, 2023, the Company has repurchased 500,000 shares under the New Stock Repurchase Program for approximately $10.6 million, leaving approximately $59.4 million of share repurchases authorized under the New Stock Repurchase Program.

Dividends

The Company has declared the following dividends on common shares as of the filing date of this Form 10-Q:

14

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

Dividend per Share		Dividends Paid		Dividend Type	Declaration Date	Record Date	Payable Date
		(in millions)
$	0.07	$	3.6	Quarterly	February 9, 2023	February 20, 2023	February 27, 2023
$	0.88	$	46.4	Special	February 13, 2023	February 28, 2023	March 7, 2023
$	0.07	$	3.7	Quarterly	April 25, 2023	May 5, 2023	May 12, 2023
$	0.07	$	3.7	Quarterly	July 28, 2023	August 7, 2023	August 14, 2023
$	0.07	$	—	Quarterly	October 24, 2023	November 3, 2023	November 10, 2023
$	0.08	$	4.2	Quarterly	February 9, 2024	February 20, 2024	February 26, 2024
$	0.50	$	26.3	Special	February 9, 2024	March 1, 2024	March 7, 2024
$	0.08	$	4.2	Quarterly	April 25, 2024	May 6, 2024	May 13, 2024

Preferred Shares

The Company is authorized to issue up to 10,000,000 shares of preferred stock, $0.01 par value per share.

Note 10. Derivative Instruments

The Company enters into natural gas swap contracts from time to time to hedge the exposure to variability in expected future cash flows associated with the fluctuations in the price of natural gas related to the Company’s forecasted sales. As of March 31, 2024 and December 31, 2023, the Company had no natural gas swap contracts outstanding.

The Company’s natural gas swap contracts economically hedge certain risks but are not designated as hedges for financial reporting purposes. All changes in the fair value of these derivative instruments are recorded as other revenues in the Condensed Statements of Operations. The Company recognized no gains or losses for the three months ended March 31, 2024. The Company recognized a gain related to natural gas swap contracts of $0.7 million, which includes $0.2 million of realized gains, for the three months ended March 31, 2023. The Company records all derivative instruments at fair value and had no asset or liability recorded as of March 31, 2024 and December 31, 2023.

Note 11. Fair Value of Financial Instruments

The Company had no significant assets or any other liabilities measured at fair value on a recurring basis as of March 31, 2024 or December 31, 2023. During the three months ended March 31, 2024, there were no transfers between Level 1, Level 2 and Level 3. The Company uses quoted dealer prices for similar contracts in active over-the-counter markets for determining fair value of Level 2 liabilities. There were no changes to the valuation techniques used to measure liability fair values on a recurring basis during the three months ended March 31, 2024.

The following methods and assumptions were used to estimate the fair value for which the fair value option was not elected:

Cash and cash equivalents, short-term investments, receivables and trade accounts payable — The carrying amounts reported in the Condensed Balance Sheets approximate fair value due to the short-term nature of these assets and liabilities.

Debt — The Company's outstanding debt is carried at cost. As of March 31, 2024, there were no borrowings outstanding under the ABL Facility, with $107.4 million available, net of outstanding letters of credit of $8.7 million. As of December 31, 2023, the Company had no borrowings outstanding under the ABL Facility, with $107.4 million available, net of outstanding letters of credit of $8.7 million. As of March 31, 2024 and December 31, 2023, the estimated fair value of the Notes based upon observable market data (Level 2) was approximately $157.7 million and $156.0 million, respectively.

Note 12. Segment Information

The Company identifies a business as an operating segment if: (i) it engages in business activities from which it may earn revenues and incur expenses; (ii) its operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”), who is the Company’s Chief Executive Officer, to make decisions about resources to be allocated to the segment

15

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

and assess its performance; and (iii) it has available discrete financial information. The Company has determined that its two underground mining operations are its operating segments. The CODM reviews financial information at the operating segment level to allocate resources and to assess the operating results and financial performance for each operating segment. Operating segments are aggregated into a reportable segment if the operating segments have similar quantitative economic characteristics and if the operating segments are similar in the following qualitative characteristics: (i) nature of products and services; (ii) nature of production processes; (iii) type or class of customer for their products and services; (iv) methods used to distribute the products or provide services; and (v) if applicable, the nature of the regulatory environment.

The Company has determined that the two operating segments are similar in both quantitative and qualitative characteristics and thus the two operating segments have been aggregated into one reportable segment. The Company has determined that its natural gas and royalty businesses and the Blue Creek mine development did not meet the criteria in ASC 280 to be considered as operating or reportable segments. Therefore, the Company has included their results in an “all other” category as a reconciling item to consolidated amounts.

The Company does not allocate all of its assets, or its depreciation and depletion expense, selling, general and administrative expenses, transactions costs, interest income (expense), and income tax expense or benefit by segment.

The following tables include reconciliations of segment information to consolidated amounts (in thousands):

	For the three months ended March 31,
	2024		2023
Revenues
Mining	$	497,998	$	500,491
All other	5,514		9,183
Total revenues	$	503,512	$	509,674

 

	For the three months ended March 31,
	2024		2023
Capital Expenditures
Mining	$	31,019	$	40,149
All other	68,684		28,030
Total capital expenditures	$	99,703	$	68,179

The Company evaluates the performance of its segment based on Segment Adjusted EBITDA, which is defined as net income adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative, business interruption, idle mine, other income, interest income (expense), net, income tax expense, loss on extinguishment of debt and certain transactions or adjustments that the CODM does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA does not represent and should not be considered as an alternative to cost of sales under GAAP and may not be comparable to other similarly titled measures used by other companies. Below is a reconciliation of Segment Adjusted EBITDA to net income, which is its most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands): 

16

WARRIOR MET COAL, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued)

THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED)

	For the three months ended March 31,
	2024		2023
Segment Adjusted EBITDA	$	212,411	$	267,861
Other revenues	5,514		9,183
Cost of other revenues	(9,965)		(11,438)
Depreciation and depletion	(40,023)		(37,213)
Selling, general and administrative	(18,658)		(14,516)
Business interruption	(201)		(4,217)
Other income	—		221
Interest income, net	7,033		1,460
Income tax expense	(19,122)		(29,064)
Net income	$	136,989	$	182,277

17

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis provides a narrative of our results of operations and financial condition for the three months ended March 31, 2024 and March 31, 2023. You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing in this Form 10-Q and the audited financial statements for the year ended December 31, 2023 included in our Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Annual Report"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis. Please see “Forward-Looking Statements.”

Overview

We are a U.S.-based, environmentally and socially minded supplier to the global steel industry. We are dedicated entirely to mining non-thermal metallurgical ("met") steelmaking coal used as a critical component of steel production by metal manufacturers in Europe, South America and Asia. We are a large-scale, low-cost producer and exporter of premium quality met coal, also known as hard coking coal (“HCC”), operating highly-efficient longwall operations in our underground mines based in Alabama, Mine No. 4 and Mine No. 7.

As of December 31, 2023, based on a reserve report prepared by Marshall Miller & Associates, Inc. ("Marshall Miller"), Mine No. 4 and Mine No. 7, our two operating mines, had approximately 82.9 million metric tons of recoverable reserves and our undeveloped Blue Creek mine contained 67.6 million metric tons of recoverable reserves and 39.7 million metric tons of coal resources exclusive of reserves, which total 107.3 million metric tons. As a result of our high-quality coal, our Mine No. 7 steelmaking coal realized price has historically been in line with, or at a slight discount to, the Platts Premium Low Volatility ("LV") Free On Board ("FOB") Australia Index Price ("Platts Index"). Our Mine No. 4 steelmaking coal transitioned in the second half of 2023 from a Mid Volatility ("MV") to a High Volatility A ("HVA") quality that typically trades at a larger discount to the price of coal from Mine No. 7. We now primarily target the East Coast High Vol A indices price for our Mine No. 4 coal. Our steelmaking coal, mined from the Southern Appalachian portion of the Blue Creek coal seam, is characterized by low sulfur, low-to-medium ash, and Low Vol to High Vol. These qualities make our coal ideally suited as a coking coal for the manufacture of steel.

We sell substantially all of our steelmaking coal production to steel producers. Steelmaking coal, which is converted to coke, is a critical input in the steel production process. Steelmaking coal is both consumed domestically in the countries where it is produced and exported by several of the largest producing countries, such as China, Australia, the United States, Canada and Russia. Therefore, demand for our coal will be highly correlated to conditions in the global steelmaking industry. The steelmaking industry’s demand for steelmaking coal is affected by a number of factors, including the cyclical nature of that industry’s business, technological developments in the steelmaking process and the availability of substitutes for steel such as aluminum, composites and plastics. A significant reduction in the demand for steel products would reduce the demand for steelmaking coal, which would have a material adverse effect upon our business. Similarly, if alternative ingredients are used in substitution for steelmaking coal in the integrated steel mill process, the demand for steelmaking coal would materially decrease, which could also materially adversely affect demand for our steelmaking coal.

Recent Developments

U.S. inflation remains at 3.5%, driven by increased energy and food costs, supply constraints and strong consumer demand. While inflation is expected to ease in the overall economy for the remainder of 2024, we have not seen it easing in the coal mining industry and expect that inflation will continue to negatively impact our profitability, as we expect inflation to remain high for steel prices, freight rates, labor and other materials and supplies. Specifically, we have experienced inflationary cost increases ranging from 25% to 35%, primarily in relation to labor, construction materials, and certain equipment. In addition, we have experienced inflation in the costs of belt structure, roof bolts, cable, magnetite, rock dust and other supplies, plus labor and parts on equipment repair and rebuilds.

The global seaborne metallurgical coal market deteriorated at the end of February 2024, primarily driven by softening demand in India and China combined with increased supply driven by strong production from Australia. These factors resulted in a $100 price decline in the Platts Index. While global met coal prices did decline sharply during the month of March 2024, they appear to have reached a floor. As of April 16, 2024, the Platts Index price for premium LV coal is $252.33 per metric ton. According to the World Steel Association short range outlook, steel demand forecast for 2024 is expected to increase 1.7% and 1.2% in 2025. The increase in steel demand is led in large part to increased demand from India of 8% over 2024 and 2025, driven by continued growth in all steel using sectors and continued strong growth in infrastructure investments. The increase

18

in steel demand in India is offset by a forecasted decrease in steel demand in China driven by the decline in real estate investments.

Collective Bargaining Agreement

Our Collective Bargaining Agreement ("CBA") with the labor union representing certain of our hourly employees expired on April 1, 2021 and the labor union initiated a strike after an agreement on a new contract was not reached. As a result of the strike, we initially idled Mine No. 4 and scaled back operations at Mine No. 7. In the first quarter of 2022, we restarted operations at Mine No. 4. On February 16, 2023, the labor union representing certain of our hourly employees announced that they were ending the strike and made an unconditional offer to return to work. We incurred business interruption expenses of approximately $0.2 million for the three months ended March 31, 2024, which represent ongoing legal expenses associated with ongoing labor negotiations. We incurred $4.2 million for the three months ended March 31, 2023, which represent non-recurring expenses that were directly attributable to the labor strike for incremental safety and security, labor negotiations and other expenses. These expenses are presented separately in the Condensed Statements of Operations. The Company continues to engage in good faith efforts with the labor union to reach an agreement on a new contract.

Acquisitions

On March 31, 2023, we acquired the remaining ownership interest in gas wells owned by an independent third party for $2.4 million. The purchase consideration was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The acquisition is not deemed to be material to the condensed financial statements.

How We Evaluate Our Operations

Our primary business, the mining and exporting of steelmaking coal for the steel industry, is conducted in one reportable business segment: mining. All other operations and results are reported under the “All Other” category as a reconciling item to consolidated amounts, which includes the business results from our sale of natural gas extracted as a byproduct from our underground coal mines, royalties from our leased properties and the business results related to the Blue Creek mine development. Our natural gas and royalty businesses do not meet the criteria in ASC 280, Segment Reporting, to be considered as operating or reportable segments.

Our management uses a variety of financial and operating metrics to analyze our performance. These metrics are significant factors in assessing our operating results and profitability and include: (i) Segment Adjusted EBITDA (as defined below), a non-GAAP financial measure; (ii) sales volumes and average net selling price, which drive coal sales revenue; (iii) cash cost of sales, a non-GAAP financial measure; and (iv) Adjusted EBITDA, a non-GAAP financial measure. The following table presents supplementary data on a historical basis for each of the periods indicated.

	For the three months ended March 31,
(in thousands)	2024			2023
Segment Adjusted EBITDA	$	212,411		$	267,861
Metric tons sold	1,931			1,767
Metric tons produced	1,861			1,596
Average net selling price per metric ton	$	257.90		$	283.24
Cash cost of sales per metric ton	$	147.16		$	131.04
Cost of production %	61		%	58		%
Transportation and royalties %	39		%	42		%
Adjusted EBITDA	$	200,197		$	259,407

Segment Adjusted EBITDA

We define Segment Adjusted EBITDA as net income adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative, business interruption, interest income (expense), net, income tax expense,

19

other income and certain transactions or adjustments that the Chief Executive Officer, our Chief Operating Decision Maker, does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess: 

•our operating performance as compared to the operating performance of other companies in the coal industry, without regard to financing methods, historical cost basis or capital structure;

•the ability of our assets to generate sufficient cash flow to pay dividends;

•our ability to incur and service debt and fund capital expenditures; and

•the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

Sales Volumes and Average Net Selling Price

We evaluate our operations based on the volume of coal we can safely produce and sell in compliance with regulatory standards, and the prices we receive for our steelmaking coal. Our sales volume and sales prices are largely dependent upon the terms of our annual steelmaking coal sales contracts, for which prices generally are set on daily index averages or a quarterly basis. The volume of steelmaking coal we sell is also a function of the pricing environment in the international met coal markets and the amounts of LV and HVA coal that we sell. We evaluate the price we receive for our steelmaking coal based on our average net selling price per metric ton.

Our average net selling price per metric ton represents our coal net sales revenue divided by total metric tons of coal sold. In addition, our average net selling price per metric ton is net of demurrage and quality specification adjustments.

Cash Cost of Sales

We evaluate our cash cost of sales on a cost per metric ton basis. Cash cost of sales is based on reported cost of sales and includes items such as freight, royalties, manpower, fuel and other similar production and sales cost items, and may be adjusted for other items that, pursuant to accounting principles generally accepted in the United States ("GAAP"), are classified in the Condensed Statements of Operations as costs other than cost of sales, but relate directly to the costs incurred to produce met coal and sell it FOB at the Port of Mobile, Alabama. Our cash cost of sales per metric ton is calculated as cash cost of sales divided by the metric tons sold. Cash cost of sales is used as a supplemental financial measure by management and by external users of our financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess: 

•our operating performance as compared to the operating performance of other companies in the coal industry, without regard to financing methods, historical cost basis or capital structure; and

•the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

We believe that this non-GAAP financial measure provides additional insight into our operating performance, and reflects how management analyzes our operating performance and compares that performance against other companies for purposes of business decision making by excluding the impact of certain items that management does not believe are indicative of our core operating performance. We believe that cash cost of sales presents a useful measure of our controllable costs and our operational results by including all costs incurred to produce met coal and sell it FOB at the Port of Mobile, Alabama. Period-to-period comparisons of cash cost of sales are intended to help management identify and assess additional trends that potentially impact us and that may not be shown solely by period-to-period comparisons of cost of sales. Cash cost of sales should not be considered an alternative to cost of sales or any other measure of financial performance or liquidity presented in accordance with GAAP. Cash cost of sales excludes some, but not all, items that affect cost of sales, and our presentation may vary from the presentations of other companies. As a result, cash cost of sales as presented below may not be comparable to similarly titled measures of other companies.

The following table presents a reconciliation of cash cost of sales to total cost of sales, the most directly comparable GAAP financial measure, on a historical basis for each of the periods indicated.

20

	For the three months ended March 31,
(in thousands)	2024		2023
Cost of sales (exclusive of depreciation and depletion)	$	285,587	$	232,630
Asset retirement obligation accretion	(702)		(540)
Stock compensation expense	(713)		(534)
Cash cost of sales	$	284,172	$	231,556

Adjusted EBITDA

We define Adjusted EBITDA as net income before interest income, net, income tax expense, depreciation and depletion, non-cash asset retirement obligation accretion, non-cash stock compensation expense, other non-cash accretion, mark-to-market gain on gas hedges, business interruption and other income. Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess: 

•our operating performance as compared to the operating performance of other companies in the coal industry, without regard to financing methods, historical cost basis or capital structure; and

•the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

We believe that the presentation of Adjusted EBITDA in this report provides information useful to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to Adjusted EBITDA is net income. Adjusted EBITDA should not be considered an alternative to net income or any other measure of financial performance or liquidity presented in accordance with GAAP. Adjustments exclude some, but not all, items that affect net income and our presentation of Adjusted EBITDA may vary from that presented by other companies.

The following table presents a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP financial measure, on a historical basis for each of the periods indicated.

	For the three months ended March 31,
(in thousands)	2024		2023
Net income	$	136,989	$	182,277
Interest income, net	(7,033)		(1,460)
Income tax expense	19,122		29,064
Depreciation and depletion	40,023		37,213
Asset retirement obligation accretion (1)	1,297		906
Stock compensation expense (2)	9,147		7,702
Other non-cash accretion (3)	451		414
Mark-to-market gain on gas hedges (4)	—		(705)
Business interruption (5)	201		4,217
Other income (6)	—		(221)
Adjusted EBITDA	$	200,197	$	259,407

(1)Represents non-cash accretion expense associated with our asset retirement obligations.

(2)Represents non-cash stock compensation expense associated with equity awards.

(3)Represents non-cash accretion expense associated with our black lung obligations.

(4)Represents mark-to-market gain recognized on gas hedges.

(5)Represents business interruption expenses associated with the labor strike.

(6)Represents proceeds received associated with the Chapter 11 Cases from Walter Energy, Inc.

21

Results of Operations

Three Months Ended March 31, 2024 and 2023

The following table summarizes certain unaudited financial information for these periods.

	For the three months ended March 31,
($ in thousands)	2024		% of Total Revenues		2023		% of Total Revenues
Revenues:
Sales	$	497,998	98.9	%	$	500,491	98.2	%
Other revenues	5,514		1.1	%	9,183		1.8	%
Total revenues	503,512		100.0	%	509,674		100.0	%
Costs and expenses:
Cost of sales (exclusive of items shown separately below)	285,587		56.7	%	232,630		45.6	%
Cost of other revenues (exclusive of items shown separately below)	9,965		2.0	%	11,438		2.2	%
Depreciation and depletion	40,023		7.9	%	37,213		7.3	%
Selling, general and administrative	18,658		3.7	%	14,516		2.8	%
Business interruption	201		—	%	4,217		0.8	%
Total costs and expenses	354,434		70.4	%	300,014		58.9	%
Operating income	149,078		29.6	%	209,660		41.1	%
Interest expense	(1,121)		(0.2)	%	(7,443)		(1.5)	%
Interest income	8,154		1.6	%	8,903		1.7	%
Other income	—		—	%	221		—	%
Income before income tax expense	156,111		31.0	%	211,341		41.5	%
Income tax expense	19,122		3.8	%	29,064		5.7	%
Net income	$	136,989	27.2	%	$	182,277	35.8	%

Sales and cost of sales components on a per unit basis were as follows: 

	For the three months ended March 31,
	2024		2023
Met Coal (metric tons in thousands)
Metric tons sold	1,931		1,767
Metric tons produced	1,861		1,596
Average net selling price per metric ton	$	257.90	$	283.24
Cash cost of sales per metric ton	$	147.16	$	131.04

We produced 1.9 million metric tons of steelmaking coal for the three months ended March 31, 2024 compared to 1.6 million metric tons for the three months ended March 31, 2023, representing a 17% increase. The increased production drove an increase in sales as both Mine No. 4 and Mine No. 7 operated at higher capacity levels in the first quarter of 2024 compared to the first quarter of 2023, driven by the employees returning from the labor strike beginning in the second quarter of 2023.

Sales for the three months ended March 31, 2024 were $498.0 million compared to $500.5 million for the three months ended March 31, 2023. The $2.5 million decrease in sales was primarily driven by a $48.9 million decrease in sales related to a $25.34 per metric ton decrease in the average net selling price per metric ton of steelmaking coal offset partially by a $46.5 million increase in sales due to a 9% or 0.2 million metric ton increase in steelmaking coal sales volume. The 9% increase in sales volumes was driven by higher production from both Mine No. 4 and Mine No. 7 operating at higher capacity levels in 2024 compared to 2023, driven by the employees returning from the labor strike beginning in the second quarter of 2023. The average net selling price of our steelmaking coal decreased 9% from the $283.24 per metric ton in the first quarter of 2023 to $257.90 per metric ton.

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For the three months ended March 31, 2024, our geographic customer mix was 44% in Europe, 38% in Asia and 18% in South America. For the three months ended March 31, 2023, our geographic customer mix was 53% in Europe, 23% in South America, 21% in Asia and 3% in the United States. Our geographic customer mix typically varies each period based on the timing of customer orders and shipments.

Other revenues for the three months ended March 31, 2024 were $5.5 million compared to $9.2 million for the three months ended March 31, 2023. Other revenues are comprised of revenue derived from our natural gas operations, gains on sales and disposals of property, plant and equipment and land, changes in the fair value of our natural gas swap contracts, as well as earned royalty revenue. The $3.7 million decrease in other revenues is primarily due to a decrease in the Southern Louisiana natural gas price average of $0.82 per Million British Thermal Unit ("MMBtu") or 34% combined with a decrease in sales volumes of 6% for the three months ended March 31, 2024 as compared to the prior year comparable period.

Cost of sales was $285.6 million, or 56.7% of total revenues, for the three months ended March 31, 2024, compared to $232.6 million, or 45.6% of total revenues for the three months ended March 31, 2023. The $53.0 million increase is primarily driven by a $31.1 million increase due to higher royalty costs on higher royalty rates currently being mined and higher labor and supply related costs on higher production volumes since the end of the labor strike. The higher labor related costs were primarily due to the employees returning from the labor strike at the beginning of the second quarter of 2023 and wage increases. Our headcount was 33% higher for three months ended March 31, 2024 compared to the three months ended March 31, 2023. In addition, costs were higher for the three months ended March 31, 2024 due to higher spending on a higher mix of rail transportation, repairs and maintenance, both of which should be temporary, and less mine development credits now that Mine No. 4 is producing from the north portal area of the mine. The remainder of the increase is also driven by a $21.5 million increase due to a 9% or 0.2 million metric ton increase in steelmaking coal sales volumes. For the three months ended March 31, 2024 cost of production represented 61% of cost of sales and transportation and royalties accounted for approximately 39% compared to cost of production of 56% and transportation and royalties of 44% for the three months ended March 31, 2023.

Depreciation and depletion expenses were $40.0 million, or 7.9% of total revenues, for the three months ended March 31, 2024, compared to $37.2 million, or 7.3% of total revenues for the three months ended March 31, 2023. The $2.8 million increase in depreciation and depletion is primarily driven by an increase in met coal sales volume as depreciation and depletion is first capitalized into coal inventory and relieved when the tons are sold.

Selling, general and administrative expenses were $18.7 million, or 3.7% of total revenues, for the three months ended March 31, 2024, compared to $14.5 million, or 2.8% of total revenues, for the three months ended March 31, 2023. The $4.1 million increase in selling, general and administrative expenses for the period is due to an increase in employee related expenses.

Business interruption expenses were $0.2 million and $4.2 million for the three months ended March 31, 2024 and 2023, respectively. The decrease in business interruption expenses is due to the end of the labor strike that the labor union initiated on April 1, 2021 in February 2023. The expenses in the three months ended March 31, 2024 represent ongoing legal expenses associated with labor negotiations and the expenses in the three months ended March 31, 2023 represent non-recurring expenses that were directly attributable to the labor strike for incremental safety and security, legal and labor negotiations and other expenses.

Interest expense was $1.1 million, or 0.2% of total revenues, for the three months ended March 31, 2024, compared to interest expense of $7.4 million, or 1.5% of total revenues, for the three months ended March 31, 2023. The $6.3 million decrease is due to the early retirement of debt in August 2023.

Interest income was $8.2 million, or 1.6% of total revenues for the three months ended March 31, 2024, compared to $8.9 million, or 1.7% of total revenues for the three months ended March 31, 2023. The $0.7 million decrease was primarily driven by a decrease in invested cash balances.

Other income was $0.2 million for the three months ended March 31, 2023 and represents proceeds received associated with the Chapter 11 Cases from Walter Energy, Inc.

For the three months ended March 31, 2024, we recognized income tax expense of $19.1 million compared to income tax expense of $29.1 million for the three months ended March 31, 2023. The $9.9 million decrease in income tax expense is primarily driven by a decrease in pre-tax income. We estimated our annual effective tax rate and applied this effective tax rate to our year-to-date pretax income at the end of the interim reporting period. The $19.1 million income tax expense for the three months ended March 31, 2024, includes a benefit related to depletion and Internal Revenue Code ("IRC") Section 250 Deduction: Foreign-Derived Intangible Income ("FDII"). The Tax Cuts and Jobs Act ("TCJA") was enacted on December 22,

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2017 and enacted IRC Section 250 Deduction: FDII, which provides for, among other things, a deduction of 37.5% with respect to foreign-derived intangible income, which reduces the statutory tax rate from 21% to 13.125%. Beginning in 2026, the deduction is reduced from 37.5% to 22.5% of foreign-derived intangible income.

Liquidity and Capital Resources

Overview

Our sources of cash have been steelmaking coal and natural gas sales to customers, proceeds received from the Notes (as defined below) and access to our ABL Facility. Historically, our primary uses of cash have been for funding the operations of our coal and natural gas production operations, working capital, our capital expenditures, our reclamation obligations, payment of principal and interest on our Notes, professional fees and other non-recurring transaction expenses. In addition, we used available cash on hand to repurchase shares of common stock and to pay our quarterly and special dividends, each of which reduces or reduced cash and cash equivalents.

Going forward, we will 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, our reclamation obligations, professional fees and other non-recurring transaction expenses and strategic investments, the development of Blue Creek, and, if declared, to pay our quarterly and/or special dividends. Our ability to fund our capital needs, including the development of Blue Creek, going forward will depend on our ongoing ability to generate cash from operations and borrowing availability under the ABL Facility, and, in the case of any future strategic investments, capital needs, the development of Blue Creek, or special dividends financed partially or wholly with debt financing and our ability to access the capital markets to raise additional capital.

Our ability to generate positive cash flow from operations in the future will be, at least in part, dependent on continued stable global economic conditions and a resolution of the CBA contract negotiations with the labor union representing certain of our hourly employees.

Our total liquidity as of March 31, 2024 was $801.3 million, consisting of cash and cash equivalents of $693.9 million and $107.4 million available under our ABL Facility. As of March 31, 2024, no loans were outstanding under the ABL Facility and there were $8.7 million of letters of credit issued and outstanding under the ABL Facility.

During the first quarter of 2023, we repurchased in the open market and extinguished approximately $8.0 million principal amount of our Notes at a discount to par value. The discounts to par value and the interest expense savings from this open-market purchase is estimated to be approximately $4.0 million through the maturity of our Notes. In connection with the extinguishment of our Notes, we recognized a loss on early extinguishment of debt of $0.1 million which is included in interest expense in the Condensed Statements of Operations.

In the future, we may, at any time and from time to time, seek to retire or purchase additional Notes in open-market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will be upon such terms and at such prices as we may determine, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, if any, and other factors.

We are responsible for medical and disability benefits for black lung disease under the Federal Coal Mine Health and Safety Act of 1969, as amended. Beginning on April 1, 2016 through May 31, 2018, we were insured under a guaranteed cost insurance policy, through a third-party insurance carrier, for black lung claims raised by any employee subsequent to the acquisition of certain assets of Walter Energy. Beginning on June 1, 2018 through May 31, 2020, we had a deductible policy where we are responsible for the first $0.5 million for each black lung claim. Since June 1, 2020, we have a deductible policy where we are responsible for the first $1.0 million for each black lung claim.

In addition, in connection with the acquisition of certain assets of Walter Energy, we assumed all black lung liabilities of Walter Energy and its U.S. subsidiaries incurred prior to March 31, 2016, for which we are self-insured. We have posted $18.6 million in surety bonds and $9.1 million of collateral recognized as short-term investments in addition to maintaining a black lung trust of $2.1 million that was acquired from Walter Energy. We received a letter from the U.S. Department of Labor ("DOL") on February 21, 2020 under its new process for self-insurance renewals that would require us to increase the amount of collateral posted to $39.8 million, but we have appealed such increase. We received another letter from the DOL on December 8, 2021 requesting additional information to support our appeal of the collateral requested by the DOL. On February 9, 2022, the DOL held a conference call with representatives from the Company related to our appeal. On July 12, 2022, we received a decision on our appeal from the DOL lowering the amount of collateral required to be posted from $39.8 million to $28 million. We appealed this decision. In addition, on January 19, 2023, the DOL proposed revisions to regulations under the

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Black Lung Benefits Act governing authorization of self-insurers. The proposed rules requires, among other requirements, all self-insured operators to post security equal to 120 percent of their projected black lung liabilities.

In the ordinary course of our business, we are required to provide surety bonds and letters of credit to provide financial assurance for certain transactions and business activities. Federal and state laws require us to obtain surety bonds or other acceptable security to secure payment of certain long-term obligations including mine closure or reclamation costs and other miscellaneous obligations. As of March 31, 2024, we had outstanding surety bonds and letters of credit with parties for post-mining reclamation at all of our mining operations totaling $45.3 million, $18.6 million as collateral for self-insured black lung related claims and $5.2 million for miscellaneous purposes.

We believe that our future cash flows from operations, together with cash on our balance sheet and proceeds from the borrowings under our ABL Facility, will provide adequate resources to fund our debt service payments and planned operating and capital expenditure needs, including the development of Blue Creek, for at least the next twelve months and beyond. However, we will continue to assess our liquidity needs in light of the ongoing CBA contract negotiations with the labor union representing certain of our hourly employees and the ongoing impact of inflation.

The Company's principal contractual commitments include repayments of long-term debt and related interest, potential minimum throughput payments associated with our rail and port providers, asset retirement obligation payments, black lung obligation payments, payments on various coal and land leases, payments under financing lease obligations and payments associated with our natural gas swap contracts. Currently, there are no known trends or expected changes anticipated in future periods that would not be indicative of past results for our contractual commitments.

Refer to the respective notes to our audited financial statements for the year ended December 31, 2023 included in our 2023 Annual Report for further information about our credit facilities and long-term debt (Note 13), commitments and contingencies (Note 15), asset retirement obligations (Note 8), black lung obligations (Note 10), lease payment obligations (Note 14), share repurchase programs (Note 16) and derivative instruments (Note 17).

If our cash flows from operations are less than we require, we may need to incur additional debt or issue additional equity. From time to time, we may need to access the long-term and short-term capital markets to obtain financing. Our access to, and the availability of, financing on acceptable terms and conditions in the future will be affected by many factors, including: (i) our credit ratings, (ii) the liquidity of the overall capital markets, (iii) the current state of the global economy and (iv) restrictions in our ABL Facility, the indenture governing the Notes (the "Indenture"), and any other existing or future debt agreements. There can be no assurance that we will have or continue to have access to the capital markets on terms acceptable to us or at all.

Statements of Cash Flows

Cash balances were $693.9 million and $738.2 million at March 31, 2024 and December 31, 2023, respectively.

The following table sets forth, a summary of the net cash provided by (used in) operating, investing and financing activities for the period (in thousands): 

	For the three months ended March 31,
	2024		2023
Net cash provided by operating activities	$	104,058	$	192,934
Net cash used in investing activities	(101,690)		(85,018)
Net cash used in financing activities	(46,707)		(74,848)
Net (decrease) increase in cash and cash equivalents	$	(44,339)	$	33,068

Operating Activities

Net cash flows from operating activities consist of net income adjusted for noncash items, such as depreciation and depletion of property, plant and equipment and mineral interests, deferred income tax expense, stock-based compensation, amortization of debt issuance costs and debt discount, accretion of asset retirement obligations, mark-to-market (gains) losses on gas hedges and changes in net working capital.

Net cash provided by operating activities was $104.1 million for the three months ended March 31, 2024, and was primarily attributed to net income of $137.0 million adjusted for depreciation and depletion expense of $40.0 million, deferred

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income tax expense of $2.9 million, stock based compensation expense of $9.2 million, accretion of asset retirement obligations of $1.3 million, amortization of debt issuance costs and debt discount of $0.4 million, and an increase in our net working capital of $85.8 million since December 31, 2023. The increase in our working capital was primarily driven by increases in accounts receivable due to higher sales volumes and the timing of sales partially offset by the draw down of inventories.

Net cash provided by operating activities was $192.9 million for the three months ended March 31, 2023, and was primarily attributed to net income of $182.3 million adjusted for depreciation and depletion expense of $37.2 million, deferred income tax expense of $29.1 million, stock based compensation expense of $7.7 million, accretion of asset retirement obligations of $0.9 million, amortization of debt issuance costs and debt discount of $0.7 million, non-cash mark-to-market gain on gas hedges of $0.5 million, and an increase in our net working capital of $69.0 million since December 31, 2022. The increase in our working capital was primarily driven by increases in accounts receivable and decreased accrued expenses and accounts payable offset partially by a decrease in inventories. The increase in trade accounts receivable reflects higher sales volumes and the timing of sales and the decrease in inventories is due to greater sales volumes than production. The decrease in accrued expenses and accounts payable is due to the timing of payments.

Investing Activities

Net cash used in investing activities was $101.7 million and $85.0 million for the three months ended March 31, 2024 and 2023, respectively, primarily due to purchases of property, plant and equipment and mine development. Capital expenditures during the three months ended March 31, 2024 for the development of Blue Creek was $68.5 million. The prior year period also includes $2.4 million cash paid to acquire the remaining ownership interest in gas wells owned by an independent third party.

Financing Activities

Net cash used in financing activities was $46.7 million for the three months ended March 31, 2024, primarily due to the payment of regular quarterly and special dividends of $30.6 million, payments for taxes related to net share settlement of equity awards of $11.8 million and finance lease obligations of $4.3 million. Net cash used in financing activities was $74.8 million for the three months ended March 31, 2023, primarily due to the payment of regular quarterly and special dividends of $50.0 million, retirements of debt related to our senior notes of $8.0 million and principal repayments of finance lease obligations of $7.6 million.

Capital Allocation Policy

On May 17, 2017, the Board adopted the Capital Allocation Policy of paying a quarterly cash dividend of $0.05 per share. In February 2022, we announced that the Board approved an increase in the regular quarterly cash dividend by 20%, from $0.05 per share to $0.06 per share. In February 2023, we announced that the Board approved an increase in the regular quarterly cash dividend by 17%, from $0.06 per share to $0.07 per share. On February 9, 2024, we announced the Board approved an increase in the regular quarterly cash dividend of 14% from $0.07 per share to $0.08 per share and declared a special cash dividend of $0.50 per share. Our strategy continues to be focused on optimizing our capital structure to improve returns to stockholders, through special cash dividends, while allowing flexibility for us to develop our strategic growth project Blue Creek. We intend on returning cash to stockholders in stronger price markets where we are generating significant amounts of cash flow, and less cash to stockholders during weaker markets. We also intend on using stock repurchases when there is no short- or long-term use for additional cash that will deliver meaningful value to stockholders. We have paid a regular quarterly cash dividend every quarter since the Board adopted the Capital Allocation Policy.

The Capital Allocation Policy states the following: In addition to the regular quarterly dividend and to the extent that the Company generates excess cash that is beyond the then current requirements of the business, the Board may consider returning all or a portion of such excess cash to stockholders through a special dividend or implementation of a stock repurchase program. Any future dividends or stock repurchases will be at the discretion of the Board and subject to consideration of a number of factors, including business and market conditions, future financial performance and other strategic investment opportunities. The Company will also seek to optimize its capital structure to improve returns to stockholders while allowing flexibility for the Company to pursue selective strategic growth opportunities that can provide compelling stockholder returns.

During the three months ended March 31, 2024, we have paid $30.6 million of regular quarterly and special cash dividends under the Capital Allocation Policy.

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Regular Quarterly Dividend

On February 9, 2023, our Board approved an increase in the regular quarterly cash dividend by 17% and declared a regular quarterly cash dividend of $0.07 per share, totaling approximately $3.6 million, which was paid on February 27, 2023 to stockholders of record as of the close of business on February 20, 2023.

On February 9, 2024, our Board approved an increase in the regular quarterly cash dividend by 14% and declared a regular quarterly cash dividend of $0.08 per share, totaling approximately $4.2 million, which was paid February 26, 2024, to stockholders of record as of the close of business on February 20, 2024.

On April 25, 2024, our Board declared a regular quarterly cash dividend of $0.08 per share, totaling approximately $4.2 million, which will be paid May 13, 2024, to stockholders of record as of the close of business on May 6, 2024.

Special Dividend

On February 13, 2023, our Board declared a special cash dividend of $0.88 per share, totaling approximately $46.4 million, which was paid on March 7, 2023 to stockholders of record as of the close of business on February 28, 2023.

On February 9, 2024, our Board declared a special cash dividend of $0.50 per share, totaling approximately $26.3 million, which was paid on March 7, 2024 to stockholders of record as of the close of business on March 1, 2024.

ABL Facility

The ABL Facility will mature on December 6, 2026. As of March 31, 2024, no loans were outstanding under the ABL Facility and there were $8.7 million of letters of credit issued and outstanding under the ABL Facility. At March 31, 2024, we had $107.4 million of availability under the ABL Facility.

Revolving loan (and letter of credit) availability under the ABL Facility is subject to a borrowing base, which at any time is equal to the sum of certain eligible billed and unbilled accounts, certain eligible inventory, certain eligible supplies inventory and qualified cash, in each case, subject to specified advance rates. The borrowing base availability is subject to certain reserves, which may be established by the agent in its reasonable credit discretion. The reserves may include rent reserves, lower of cost or market reserve, port charges reserves and any other reserves that the Agent determines in its reasonable credit judgment to the extent such reserves relate to conditions that could reasonably be expected to have an adverse effect on the value of the collateral included in the borrowing base.

Borrowings under the ABL Facility bear interest at a rate equal to either (i) the Secured Overnight Financing Rate ("SOFR"), plus a credit adjustment spread, ranging currently from approximately 11 bps to 43 bps depending on the interest period selected by us, or (ii) an alternate base rate plus, in each case of the foregoing (i) and (ii), an applicable margin, which is determined based on the average availability of the commitments under the ABL Facility, ranging currently from 150 bps to 200 bps or 50 bps to 100 bps, respectively. In addition to paying interest on the outstanding borrowings under the ABL Facility, we are required to pay a fee in respect of unutilized commitments, which is based on the availability of the commitments under the ABL Facility, ranging from 25 bps to 37.5 bps. We are also required to pay a fee on amounts available to be drawn under outstanding letters of credit under the ABL Facility at a rate not in excess of 200 bps, and certain administrative fees.

The ABL Facility contains customary covenants for asset-based credit agreements of this type, including among other things: (i) requirements to deliver financial statements, other reports and notices; (ii) restrictions on the existence or incurrence of certain indebtedness; (iii) restrictions on the existence or incurrence of certain liens; (iv) restrictions on making certain restricted payments; (v) restrictions on making certain investments; (vi) restrictions on certain mergers, consolidations and asset dispositions; (vii) restrictions on certain transactions with affiliates; and (viii) restrictions on modifications to certain indebtedness. Additionally, 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 a certain amount. As of March 31, 2024, we were not subject to this covenant. Subject to customary grace periods and notice requirements, the ABL Facility also contains customary events of default.

We were in compliance with all applicable covenants under the ABL Facility as of March 31, 2024.

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Senior Secured Notes

On December 6, 2021, we issued $350.0 million in aggregate principal amount of 7.875% senior secured notes due 2028 (the “Notes”) at an initial price of 99.343% of their face amount. The Notes were issued to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to certain non-U.S. persons in transactions outside the United States in accordance with Regulation S under the Securities Act. We used the net proceeds of the offering of the Notes, together with cash on hand, to fund the redemption of all of our outstanding 8.00% senior secured notes due 2024 (the “Existing Notes”), including payment of the redemption premium in connection with such redemption.

The Notes will accrue interest at a rate of 7.875% per year from December 6, 2021. Interest on the Notes will be payable on June 1 and December 1 of each year, commencing on June 1, 2022. The Notes will mature on December 1, 2028.

Capital Expenditures

Our mining operations require investments to maintain, expand, upgrade or enhance our operations and to comply with environmental regulations. Maintaining and expanding mines and related infrastructure is capital intensive. Specifically, the exploration, permitting and development of met coal reserves, mining costs, the maintenance of machinery and equipment and compliance with applicable laws and regulations require ongoing capital expenditures. The cost of our capital expenditures are also impacted by inflation and any prolonged inflation could result in higher costs and decreased margins and earnings. While a significant amount of the capital expenditures required at our mines has been spent, we must continue to invest capital to maintain our production. In addition, any decisions to increase production at our mines and the development of the high-quality met coal recoverable reserves at Blue Creek could also affect our capital needs or cause future capital expenditures to be higher than in the past and/or higher than our estimates.

To fund our capital expenditures, we may be required to use cash from our operations, incur debt or sell equity securities. Our ability to obtain bank financing or our ability to access the capital markets for future equity or debt offerings may be limited by our financial condition at the time of any such financing or offering and the covenants in our current or future debt agreements, as well as by general economic conditions and contingencies and uncertainties, that are beyond our control.

Our capital expenditures were $99.7 million and $68.2 million for the three months ended March 31, 2024 and March 31, 2023, respectively. Capital expenditures for these periods are primarily related to investments required to develop Blue Creek and Mine No. 4 North as well as expenditures necessary to maintain our property, plant and equipment. Capital expenditures for the development of Blue Creek for the three months ended March 31, 2024 were $68.5 million and $434.5 million has been spent on this project to date. Our deferred mine development costs were $2.0 million and $14.5 million for the three months ended March 31, 2024 and March 31, 2023, respectively, and relate to the development of Blue Creek and Mine No. 4 North.

Our capital spending is expected to range from $435.0 million to $500.0 million for the full year 2024, consisting of sustaining capital expenditures of approximately $100.0 to $110.0 million and discretionary capital expenditures of approximately $335.0 to $390.0 million for the development of Blue Creek and Mine No. 4 North. Our sustaining capital expenditures include expenditures related to longwall operations, continuous miners, new ventilation, and bleeder shafts.

Update on the Development of Blue Creek

On May 3, 2022, we announced the relaunch of the development of our Blue Creek mine, a strategic growth project that we expect will deliver significant future returns to stockholders. We believe that Blue Creek represents one of the few remaining untapped reserves of premium High Vol A steelmaking coal in the United States and that it has the potential to provide us with meaningful growth. We believe that the combination of low production costs and the high quality of the High Vol A steelmaking coal mined from Blue Creek, assuming we achieve our expected price realizations, will generate some of the highest steelmaking coal margins in the U.S., generate strong investment returns and achieve a rapid payback of our investment across a range of steelmaking coal price environments.

Our third-party reserve report indicates that, once developed, Blue Creek will produce a premium High Vol A steelmaking coal that is characterized by low-sulfur and high coke strength after reaction. High Vol A steelmaking coal has traditionally priced at a discount to the Australian Premium Low Vol and the U.S. Low Vol coals; however, we have observed extended periods in which they achieved a premium over these indices. Warrior expects High Vol A coals will continue to become increasingly scarce as a result of Central Appalachian producers mining thinner and deeper reserves, which we expect

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will continue to support prices. This trend creates an opportunity for us to take advantage of favorable pricing dynamics driven by the declining supply of premium High Vol A steelmaking coal.

We believe that the execution risk of Blue Creek is lower than most projects of this size and nature due to utilizing highly experienced engineers with strong backgrounds in building new mines around the world to manage the project. The same highly experienced and knowledgeable engineers and familiar contractors who built mine infrastructure in recent years are being leveraged to build Blue Creek.

In 2023, we focused on the slope, return shaft, service shaft, bathhouse, warehouse, and substations. Also, in 2023, we initiated important and highly beneficial project scope changes that will require incremental capital expenditures over the life of the project while lowering operating costs, increasing flexibility to manage risks, and making better use of multi-channel transportation methods. While we originally planned on a single channel to transport coal from the Blue Creek mine via an overland belt to a third-party owned and operated barge loadout facility, we now plan to build a belt conveyor system to a railroad loadout to transport the majority of the coal. We expect this change to de-risk the single channel to market, lower operating costs and move volumes faster to the port. We will also plan to build and operate a barge loadout ourselves rather than utilizing a third-party provider. We believe that the potential economic benefits associated with this scope change should provide us with an inherently robust and cost competitive outbound logistics model that will provide additional flexibility to manage alternative transportation methods.

The inclusion of the benefits and incremental capital expenditures relating to these specific scope changes did not have a material impact on the project economic metrics of net present value and internal rate of return and did not change the project timeline. In addition, we have experienced inflationary cost increases ranging from 25% to 35%, primarily in relation to labor, construction materials, and certain equipment. Inflationary pressures are expected to continue during the remainder of the project development period. While cost inflation has impacted the cost of the project, these inflationary pressures are expected to be offset by an inflationary increase in the long-term price assumption for steelmaking coal.

These important and highly beneficial project scope changes reset the original baseline cost for the project over the five-year period. The revised project cost includes the original estimate of $700 million, plus scope changes of $120-$130 million, plus the impact of inflationary cost ranging from 25 to 35 percent. The new baseline project cost estimate ranges from $995 million to $1.075 billion.

In 2024, we plan to continue to make significant progress on the major components for seam access, surface infrastructure and coal transportation, which include the production slope, service shaft, ventilation shaft, continuous miner development, material handling belts, and run of mine belts. We are also focused on increasing the headcount at Blue Creek by approximately 100 employees.

We have invested approximately $434.5 million project to date, including $68.5 million in the first quarter of 2024. We expect to spend $325 to $375 million in 2024 on the continued development of Blue Creek and of the remaining capital expenditures, we generally expect to spend approximately 70% in 2025 and 30% in 2026.

The project remains on schedule with the first development tons from continuous miner units expected in the third quarter of 2024 and the longwall scheduled to start up in the second quarter of 2026. We expect to ramp up production through the development of the project. Specifically, we expect to produce approximately 200 thousand metric tons in 2024, approximately 900 thousand metric tons in 2025, approximately 2.7 million metric tons in 2026 and approximately 4.4 million metric tons in 2027. We do not expect the tons produced in 2024 and 2025 of approximately 1.1 million metric tons to be sold until the second half of 2025 when the preparation plant comes online.

If we are able to successfully develop Blue Creek, we expect that it will be a transformational investment for us. We expect that the new single longwall mine at Blue Creek will have the capacity to produce an average of 4.4 million metric tons per annum of premium High Vol A met coal over the first ten years of production, thereby increasing our annual production capacity by approximately 60%. We expect the addition of Blue Creek to enhance our already advantageous position on the global cost curve, improve our profitability and cash flow generation, and cement our position as a leading pure play steelmaking coal producer.

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Critical Accounting Policies

The financial statements are prepared in conformity with GAAP, which require the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses in the period presented. Management evaluates these estimates and assumptions on an ongoing basis, using historical experience, consultation with experts and other methods considered reasonable in the particular circumstances. Nevertheless, actual results may differ significantly from management’s estimates.

Our most critical accounting estimates are those that are most important to the presentation of our financial condition and results of operations and require management’s most difficult, subjective and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. These estimates are based upon management’s historical experience and on various other assumptions that we believe are reasonable under the circumstances. Changes in estimates used in these and other items could have a material impact on our financial statements.

As of March 31, 2024, there have been no material changes to our critical accounting estimates as described in the "Critical Accounting Policies" in Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in the 2023 Annual Report.

Off-Balance Sheet Arrangements

In the ordinary course of our business, we are required to provide surety bonds and letters of credit to provide financial assurance for certain transactions and business activities. Federal and state laws require us to obtain surety bonds or other acceptable security to secure payment of certain long-term obligations including mine closure or reclamation costs and other miscellaneous obligations. As of March 31, 2024, we had outstanding surety bonds and letters of credit with parties for post-mining reclamation at all of our U.S. mining operations totaling $45.3 million, for collateral for self-insured black lung related claims totaling $18.6 million and for miscellaneous purposes totaling $5.2 million.

Recently Adopted Accounting Standards

A summary of recently adopted accounting pronouncements is included in Note 2 of the "Notes to Condensed Financial Statements" in this Form 10-Q.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Commodity Price Risk

We are exposed to commodity price risk on sales of steelmaking coal. We typically sell most of our steelmaking coal under fixed supply contracts primarily with indexed pricing terms and volume terms of up to one to three years. Sales commitments in the steelmaking coal market are typically not long-term in nature, and we are, therefore, subject to fluctuations in market pricing.

We occasionally enter into natural gas swap contracts to hedge the exposure to variability in expected future cash flows associated with the fluctuations in the price of natural gas related to our forecasted sales. Our natural gas swap contracts economically hedge certain risk but are not designated as hedges for financial reporting purposes. All changes in the fair value of these derivative instruments are recorded as other revenues in the Condensed Statements of Operations. Historically, all of our derivative instruments were entered into for hedging purposes rather than speculative trading. As of March 31, 2024, the Company had no natural gas swap contracts outstanding.

We have exposure to price risk for supplies that are used directly or indirectly in the normal course of production, such as diesel fuel, steel, explosives and other items. We manage our risk for these items through strategic sourcing contracts in normal quantities with our suppliers. We historically have not entered into any derivative commodity instruments to manage the exposure to changing price risk for supplies.

Credit Risk

Financial instruments that potentially subject us to a concentration of credit risk consist principally of trade receivables. We provide our products to customers based on an evaluation of the financial condition of our customers. In some instances, we require letters of credit, cash collateral or prepayments from our customers on or before shipment to mitigate the

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risk of loss. Exposure to losses on receivables is principally dependent on each customer’s financial condition. We monitor the exposure to credit losses and maintain allowances for anticipated losses. As of March 31, 2024 and December 31, 2023, the estimated allowance for credit losses was immaterial and did not have a material impact on the Company's financial statements.

Interest Rate Risk

We are exposed to market risk from changes in interest rates. Our Notes have a fixed rate of interest of 7.875% per annum and are payable semi-annually in arrears on June 1 and December 1 of each year.

Our ABL Facility bears an interest rate equal to SOFR, plus a credit adjustment spread, ranging currently from 11 bps to 43 bps, or an alternate base rate plus an applicable margin, which is determined based on the average availability of the commitments under the ABL Facility, ranging currently from 150 bps to 200 bps or 50 bps to 100 bps, respectively. Any debt that we incur under the ABL Facility will expose us to interest rate risk. If interest rates increase significantly in the future, our exposure to interest rate risk will increase. As of March 31, 2024, assuming we had $116.0 million outstanding under our ABL Facility, a 100-basis point increase or decrease in interest rates would increase or decrease our annual interest expense under the ABL Facility by approximately $1.1 million.

Impact of Inflation

We have exposure to inflation for supplies that are used directly or indirectly in the normal course of production, such as belt structure, roof bolts, cable, magnetite, rock dust and other supplies, plus labor and parts on repair and rebuild equipment. These inflationary pressures have contributed to rising costs for us and may continue to do so in the future. We are applying a number of different strategies to mitigate the impact of inflation on our operations, including placing purchase orders earlier, utilizing short-term contracts and leveraging our supplier relationships.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As required by Rule 13a-15(b) under the Exchange Act, our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) under the Exchange Act) as of March 31, 2024. Based on the evaluation of our disclosure controls and procedures as of March 31, 2024, our Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2024, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and (2) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during our most recently completed fiscal quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Disclosure Controls and Procedures

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

See Note 8 of the “Notes to Condensed Financial Statements” in this Form 10-Q for a description of current legal proceedings, which is incorporated by reference in this Part II, Item 1.

We and our subsidiaries are parties to a number of other lawsuits arising in the ordinary course of our business. We record costs relating to these matters when a loss is probable and the amount can be reasonably estimated. The effect of the outcome of these matters on our future results of operations cannot be predicted with certainty as any such effect depends on future results of operations and the amount and timing of the resolution of such matters. While the results of litigation cannot be predicted with certainty, we believe that the final outcome of such litigation will not have a material adverse effect on our financial statements.

Item 1A. Risk Factors.

There have been no material changes to the risk factors disclosed in “Risk Factors” in “Part I, Item 1A. Risk Factors” in our 2023 Annual Report. Our business, financial condition, operating results and cash flows can be impacted by a number of factors, any one of which could cause actual results to vary materially from recent results or from anticipated future results. In addition to the other information set forth in this Form 10-Q, you should carefully consider the risks discussed in “Part I, Item 1A. Risk Factors” in our 2023 Annual Report, which could materially affect our business, financial condition or future results. However, the risks described in our 2023 Annual Report are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also become material and adversely affect our business, financial condition and/or operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

The following table sets forth share repurchases of our common stock made during the three months ended March 31, 2024:

Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under The Plans or Programs(1)
January 1, 2024 - January 31, 2024
New Stock Repurchase Program(1)	—	$	—	—	$	59,000,000
Employee Transactions(2)	3,637	$	60.97	—
February 1, 2024 - February 29, 2024
New Stock Repurchase Program(1)	—	$	—	—
Employee Transactions(2)	196,219	$	60.02	—
March 1, 2024 - March 31, 2024
New Stock Repurchase Program(1)	—	$	—	—
Employee Transactions(2)	—	$	—	—
Total	199,856			—

__________

(1)On March 26, 2019, the Board approved the New Stock Repurchase Program that authorizes repurchases of up to an aggregate of $70.0 million of our outstanding common stock. The New Stock Repurchase Program does not require us to repurchase a specific number of shares or have an expiration date.

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(2)These shares were acquired to satisfy certain employees' tax withholding obligations associated with the lapse of restrictions on certain restricted stock awards granted under the 2016 Equity Incentive Plan and 2017 Equity Incentive Plan. Upon acquisition, these shares were retired.

Item 3. Defaults on Senior Securities.

None.

Item 4. Mine Safety Disclosures.

The information concerning mine safety violations and other regulatory matters is filed as Exhibit 95 to this Form 10-Q pursuant to the requirements of Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104).

Item 5. Other Information.

Rule 10b5-1 Trading Plans

From time to time, members of the Company's Board of Directors and officers of the Company may enter into Rule 10b5-1 trading plans, which allow for the purchase or sale of common stock under pre-established terms at times when directors and officers might otherwise be prevented from trading under insider trading laws or because of self-imposed blackout periods. Such trading plans are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act and comply with the Company's insider trading policy. Other than as described below, during the three months ended March 31, 2024, none of the Company’s directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

On February 26, 2024, Jack K. Richardson, Chief Operating Officer of the Company, adopted a Rule 10b5-1 trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a "Rule 10b5-1 Plan"). Mr. Richardson's plan, which provides for the potential sale of up to 117,005 shares of the Company's common stock, terminates upon the earlier of December 31, 2025 or the date all shares subject to the plan have been sold. In addition, on February 27, 2024, Mr. Richardson terminated the previous Rule 10b5-1 Plan entered into on November 7, 2023, which provided for the potential sale of up to 88,000 shares of the Company's common stock.

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Item 6. Exhibits

Exhibit Number	Description
3.1	Certificate of Incorporation of Warrior Met Coal, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Registration Statement on Form S-8 (File No. 333-217389) filed with the Commission on April 19, 2017)
3.2	Certificate of Amendment to the Certificate of Incorporation of Warrior Met Coal, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 001-38061) filed with the Commission on March 20, 2020)
3.3	Second Certificate of Amendment of the Certificate of Incorporation of Warrior Met Coal, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K (File No. 001-38061) filed with the Commission on April 26, 2022).
3.4	Amended and Restated Bylaws of Warrior Met Coal, Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-380619) filed with the Commission on December 7, 2022).
3.5	Certificate of Designations of Series A Junior Participating Preferred Stock of Warrior Met Coal, Inc., as filed with the Secretary of State of the State of Delaware on February 14, 2020 (incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K (File No. 001-38061) filed with the Commission on February 14, 2020)
4.6*	Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934
31.1*	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended.
31.2*	Certification of Chief Financial Officer Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended.
32.1**	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
95*	Mine Safety Disclosures Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 299.104).
101.INS*	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*	Inline XBRL Taxonomy Extension Schema Document
101.CAL*	Inline XBRL Taxonomy Extension Calculation LinkBase Document
101.DEF*	Inline XBRL Taxonomy Extension Definition LinkBase Document
101.LAB*	Inline XBRL Taxonomy Extension Label LinkBase Document
101.PRE*	Inline XBRL Taxonomy Extension Presentation LinkBase Document
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*    Filed herewith.

**    Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	WARRIOR MET COAL, INC.
Date: May 1, 2024	By:	/s/ Dale W. Boyles
		Dale W. Boyles
		Chief Financial Officer (on behalf of the registrant and as Principal Financial and Accounting Officer)

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EX-4.6

Exhibit 4.6

Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

As of the filing date of the Annual Report on Form 10-K for the year ended December 31, 2023, Warrior Met Coal, Inc. (the “Company,” “we,” “us,” or “our”) had two classes of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended:

•Common Stock, par value $0.01 per share (the “common stock”); and

•Series A Junior Participating Preferred Stock Purchase Rights, par value $0.01 per share (the “preferred stock purchase rights”).

The following summary includes a brief description of the Company’s common stock and preferred stock purchase rights, as well as certain related additional information. The summary is not complete and is qualified in its entirety by reference to the Company’s Certificate of Incorporation (“certificate of incorporation”), Bylaws (“bylaws”) and Rights Agreement dated as of February 14, 2020 (the “Rights Agreement”), as amended by that certain Amendment No. 1 (the “First Amendment”), dated as of March 4, 2022 and Amendment No. 2 (the “Second Amendment”), dated as of December 8, 2023.

Under our certificate of incorporation, we are authorized to issue up to 150,000,000 shares of capital stock, consisting of 140,000,000 shares of common stock, $0.01 par value per share, and 10,000,000 shares of preferred stock, $0.01 par value per share. Our shares of common stock are listed on the New York Stock Exchange under the symbol “HCC” and our preferred stock purchase rights are also listed on the New York Stock Exchange.

Common Stock

Holders of shares of our common stock are entitled to one vote per share on all matters submitted to a vote of stockholders. Shares of common stock do not have cumulative voting rights, which means that the holders of more than 50% of the shares voting for the election of our board of directors are able to elect all the directors to be elected at that time, and, in such event, the holders of the remaining shares are unable to elect any directors to be elected at that time. Our certificate of incorporation does not provide stockholders any preemptive rights to acquire or subscribe for any stock, obligation, warrant or other securities of ours. Holders of shares of our common stock have no redemption or conversion rights nor are they entitled to the benefits of any sinking fund provisions.

In the event of our liquidation, dissolution or winding up, holders of shares of our common stock will be entitled to receive, pro rata, all the remaining assets of the Company available for distribution to our stockholders after payment of our debts and after there shall have been paid to or set aside for the holders of our capital stock ranking senior to common stock in respect of rights upon liquidation, dissolution or winding up the full preferential amounts to which they are respectively entitled.

Holders of record of shares of our common stock are entitled to receive dividends when and if declared by our board of directors out of any assets legally available for such dividends, subject to both the rights of all outstanding shares of capital stock ranking senior to the common stock in respect of dividends and to any dividend restrictions contained in debt agreements. All outstanding shares of our common stock and any shares sold in this offering are fully paid and non-assessable.

Preferred Stock Purchase Rights

The Rights. The Company issued a right with respect to each share of common stock outstanding on February 28, 2020 (the “Record Date”). The rights initially trade with, and are inseparable from, the common stock. New rights will accompany any new shares of common stock issued after the Record Date until the earlier of the Distribution Date (as defined below), the redemption date or the expiration date of the rights, as described below. Prior to exercise, a right does not give its holder any dividend, voting or liquidation rights.

Exercise Price. Each right will allow its registered holder to purchase from the Company one one-thousandth of a share of Series A Preferred Stock (as defined below), for $159.00, subject to adjustment under certain circumstances (the “Purchase Price”), once the rights become exercisable.

Exercisability. The rights will not be exercisable until the earlier to occur of:

•10 business days following public announcement that a person or group of affiliated or associated persons has become an Acquiring Person (as defined below) or such earlier date that a majority of our board of directors becomes aware of the existence of such Acquiring Person, or

•10 business days (or a later date determined by our board of directors before any person or group becomes an Acquiring Person) following the commencement of, or announcement of an intention to make, a tender or exchange offer which, if completed, would result in that person or group becoming an Acquiring Person.

The date when the rights become exercisable is referred to as the “Distribution Date.” Until the Distribution Date, the rights are evidenced, with respect to any common stock certificates outstanding as of the Record Date, by such common stock certificates, and with respect to any shares of common stock held in uncertificated form as of the Record Date, by the book entries in the book-entry system for the common stock, in each case together with a copy of a Summary of Rights that the Company will send to all holders of record of common stock as of the Record Date. Until the Distribution Date, new common stock certificates issued after the Record Date upon transfer or new issuance of share of common stock will contain a legend regarding the rights (which certificates will evidence the associated rights) and the Company will deliver a notice regarding the rights upon the transfer or new issuance of shares of common stock held in book-entry form (which book-entries will evidence the associated rights). Until the Distribution Date (or earlier redemption, exchange, termination or expiration of the rights), the surrender for transfer of any certificates for common stock or book-entry shares, with or without such legend, notice or Summary of Rights, will also constitute the transfer of the associated rights. After the Distribution Date, the rights will separate from the common stock and be evidenced solely by right certificates that the Company will mail to all eligible holders of common stock. Any rights held by an Acquiring Person or an associate or affiliate thereof and certain transferees thereof will be null and void and may not be exercised.

Acquiring Person. “Acquiring Person” means any person or group that acquires 4.99% or more of the outstanding common stock or any existing stockholder who currently owns 5.00% or more of the common stock that acquires any additional shares of common stock without the approval of the our board of directors. The Rights Agreement also gives discretion to our board of directors to determine that someone is an Acquiring Person even if they do not own 4.99% or more of the outstanding common stock but do own 4.99% or more in value of the Company’s outstanding stock, as determined pursuant to Section 382 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) and the regulations promulgated thereunder. In addition, our board of directors has established procedures to consider requests to exempt certain acquisitions of the Company’s securities from the Rights Agreement if the board of directors determines that doing so would not limit or impair the availability of the NOLs (as defined below) or is otherwise in the best interests of the Company.

Consequences of a Person or Group Becoming an Acquiring Person. If a person or group of affiliated or associated persons becomes an Acquiring Person, all holders of rights except the Acquiring Person or an associate or affiliate thereof and certain transferees thereof may, upon exercise of a right, purchase for the Purchase Price shares of common stock with a market value of two times the Purchase Price, based on the market price of the common stock prior to such acquisition. If the Company does not have a sufficient number of shares of common stock available, the Company may under certain circumstances substitute shares of Series A Preferred Stock or other securities or property for the common stock into which the rights would have otherwise been exercisable.

Exempt Persons. Our board of directors recognizes that there may be instances when an acquisition of shares of the common stock that would cause a stockholder to become an Acquiring Person may not jeopardize or endanger, in any material respect, the availability of the net operating loss carryforwards (the “NOLs”) to the Company. Accordingly, the Rights Agreement grants discretion to our board of directors to designate a person as an “Exempt Person.” Our board of directors can revoke an “Exempt Person” designation if it subsequently makes a contrary determination regarding whether a person jeopardizes or endangers in any material respect the availability of the NOLs to the Company.

Expiration. The rights will expire on the earliest of (i) the close of business on April 19, 2026, (ii) the close of business on the first anniversary of the date of entry into the Rights Agreement, if stockholder approval of the Rights Agreement has not been received by or on such date, (iii) the time at which the rights are redeemed as provided in the Rights Agreement, (iv) the time at which the rights are exchanged as provided in the Rights Agreement, (v) the time at which our board of directors determines that the NOLs are fully utilized or no longer available under Section 382 of the Code, (vi) the effective date of the repeal of Section 382 of the Code if our board of directors determines that the Rights Agreement is no longer necessary or desirable for the preservation of NOLs, or (vii) the closing of any merger or other acquisition transaction involving the Company pursuant to an agreement of the type described in the Rights Agreement.

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Redemption. Our board of directors may redeem the rights for $0.01 per right at any time before any person or group becomes an Acquiring Person. If our board of directors redeems any rights, it must redeem all of the rights. Once the rights are redeemed, the only right of the holders of rights will be to receive the redemption price of $0.01 per right. The redemption price will be adjusted if the Company has a stock split or issues stock dividends of its common stock.

Exchange. After a person or group becomes an Acquiring Person, but before an Acquiring Person owns 50% or more of the outstanding common stock, in lieu of the consequences described above in “Consequences of a Person or Group Becoming an Acquiring Person,” our board of directors may extinguish the rights by exchanging one share of common stock or an equivalent security for each right, other than rights held by the Acquiring Person or an affiliate or associate thereof and certain transferees thereof, which will have become null and void.

Anti-Dilution Provisions. The Purchase Price of the Series A Preferred Stock, the number of shares of Series A Preferred Stock issuable and the number of outstanding rights are subject to adjustment to prevent dilution that may occur as a result of certain events, including among others, a stock dividend, a stock split, or a reclassification of the Series A Preferred Stock or common stock. With certain exceptions, no adjustments to the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in such Purchase Price.

Amendments. The terms of the Rights Agreement may be amended by our board of directors without the consent of the holders of the rights except that after a person or group becomes an Acquiring Person, our board of directors may not amend the agreement in a way that adversely affects holders of the rights.

Anti-Takeover Effects of Provisions of the Rights Agreement. In general terms, the Rights Agreement works by imposing a significant penalty upon the Acquiring Person. The Rights Agreement also gives discretion to our board of directors to determine that someone is an Acquiring Person even if they do not own 4.99% or more of the outstanding common stock but do own 4.99% or more in value of the Company’s outstanding stock, as determined pursuant to Section 382 of the Internal Revenue Code and the regulations promulgated thereunder (a “Value Determination”). Stockholders who currently own 5.00% or more of the common stock will not trigger the rights unless they acquire additional shares of common stock, subject to certain exceptions set forth in the Rights Agreement. In addition, our board of directors has established procedures to consider requests to exempt certain acquisitions of the Company’s securities from the Rights Agreement if our board of directors determines that doing so would not limit or impair the availability of the NOLs or is otherwise in the best interests of the Company.

Series A Junior Participating Preferred Stock

In connection with the adoption of the Rights Agreement, our board of directors approved a Certificate of Designations of Series A Junior Participating Preferred Stock designating 140,000 shares of Series A Preferred Stock, par value $0.01 per share, of our authorized preferred stock. Each one one-thousandth of a share of Series A Preferred Stock, if issued:

•will not be redeemable.

•will entitle the holder to quarterly dividend payments equal to the dividend paid on one share of common stock.

•will entitle the holder upon liquidation, dissolution or winding-up of the Company to receive the greater of (a) $0.01 per one one-thousandth of a share of Series A Preferred Stock (plus any accrued but unpaid dividends) and (b) an amount equal to the payment made on one share of common stock.

•will have the same voting power as one share of common stock.

•if shares of common stock are exchanged via merger, consolidation, or a similar transaction, will entitle the holder to a payment equal to the payment made on one share of common stock.

The value of one one-thousandth interest in a share of Series A Preferred Stock should approximate the value of one share of common stock.

Preferred Stock

Our board of directors is authorized to issue up to 10,000,000 shares of preferred stock (inclusive of the Series A Preferred Stock) in one or more series and to determine:

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•the distinctive serial designation and number of shares of the series;

•the voting powers and the right, if any, to elect a director or directors;

•the terms of office of any directors the holders of preferred shares are entitled to elect;

•the dividend rights, if any;

•the terms of redemption, and the amount of and provisions regarding any sinking fund for the purchase or redemption thereof;

•the liquidation preferences and the amounts payable on dissolution or liquidation;

•the terms and conditions under which shares of the series may or shall be converted into any other series or class of stock or debt of the corporation;

•and any other terms or provisions which our board of directors is legally authorized to fix or alter.

We will not need stockholder approval to issue or fix the terms of the preferred stock. The actual effect of the authorization of the preferred stock upon your rights as holders of common stock is unknown until our board of directors determines the specific rights of owners of any series of preferred stock. Depending upon the rights granted to any series of preferred stock, your voting power, liquidation preference or other rights could be adversely affected. Preferred stock may be issued in acquisitions or for other corporate purposes. Issuance in connection with a stockholder rights plan or other takeover defense could have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from acquiring, control of the Company.

Related Party Transactions and Corporate Opportunities

Subject to the limitations of applicable law, our certificate of incorporation, among other things:

•permits us to enter into contracts and transactions in which one or more of our officers or directors may be a party to or may be financially or otherwise interested in so long as such contract or transaction is approved by our board of directors in accordance with the Delaware General Corporation Law (“DGCL”);

•permits any of our stockholders or non-employee directors and their affiliates to engage in a corporate opportunity in the same or similar business activities or lines of business in which we engage or propose to engage, compete with us and to make investments in any kind of property in which we may make investments and will not be deemed to have (i) acted in a manner inconsistent with his or her fiduciary or other duties to us regarding the opportunity, (ii) acted in bad faith or in a manner inconsistent with our best interests or (iii) be liable to us or our stockholders for breach of any fiduciary duty by reason of the fact that they have engaged in such activities; and

•provides that if any of our stockholders, non-employee directors or their affiliates acquire knowledge of a potential business opportunity, transaction or other matter (other than one expressly offered to any non-employee director in writing solely in his or her capacity as our director ), such stockholder, non-employee director or affiliate will have no duty to communicate or offer that opportunity to us, and will be permitted to pursue or acquire such opportunity or offer that opportunity to another person and will not be deemed to have (i) acted in a manner inconsistent with his or her fiduciary or other duties to us regarding the opportunity, (ii) acted in bad faith or in a manner inconsistent with our best interests or (iii) be liable to us or our stockholders for breach of any fiduciary duty by reason of the fact that they have pursued or acquired such opportunity or offered the opportunity to another person.

Anti-Takeover Effects of Provisions of Our Certificate of Incorporation and Bylaws

Our certificate of incorporation and bylaws contain provisions that could make it more difficult to acquire us by means of a merger, tender offer, proxy contest or otherwise, or to remove our incumbent officers and directors. These provisions, summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the

    4

disadvantages of discouraging such proposals because negotiation of such proposals could result in an improvement of their terms.

Undesignated preferred stock. The ability to authorize and issue undesignated preferred stock may enable our board of directors to render more difficult or discourage an attempt to change control of us by means of a merger, tender offer, proxy contest or otherwise. For example, if in the due exercise of its fiduciary obligations, our board of directors were to determine that a takeover proposal is not in our best interest, our board of directors could cause shares of preferred stock to be issued without stockholder approval in one or more private offerings or other transactions that might dilute the voting or other rights of the proposed acquirer or insurgent stockholder or stockholder group.

Stockholder meetings. Our certificate of incorporation and bylaws provide that a special meeting of stockholders may be called only by the chairman of our board, by a resolution adopted by a majority of our board of directors or at the request of holders of a majority of our outstanding common stock. Stockholders requesting a special meeting are required to provide a notice to us with the proposed date, time and place of the meeting (which may not be earlier than 60 days after the date the notice is delivered to us (or 90 days in the case of special meetings called to elect one or more directors)) and the purposes for which the special meeting is being called. The stockholders requesting the special meeting are also required to comply with the requirements that would be applicable if the stockholders were proposing to nominate a candidate for election as a director at an annual meeting or proposing a topic for consideration at an annual meeting.

382 Transfer Restrictions. Our certificate of incorporation contains 382 Transfer Restrictions, which require approval from our board of directors in order for a person to acquire 4.99% of our stock or for any existing 4.99% holder to increase their ownership percentage upon the Company’s conversion to a corporation. In particular, without the approval of our board of directors, no person or group of persons treated as a single entity under Treasury Regulation Section 1.382-3 is permitted to acquire, whether directly, indirectly or constructively, and whether in one transaction or a series of related transactions, any of our common stock or any other instrument treated as stock for purposes of Section 382, to the extent that after giving effect to such purported acquisition (a) the purported acquirer, or any other person by reason of the purported acquirer’s acquisition, would become a Substantial Holder (as defined below), or (b) the percentage of ownership of our common stock by a person that, prior to giving effect to the purported acquisition, is already a Substantial Holder would be increased. A “Substantial Holder” is a person that owns (as determined for purposes of Section 382 of the Code) at least 4.99% of the total value of our common stock, including any instrument treated as stock for purposes of Section 382 of the Code.

Requirements for advance notification of stockholder nominations and proposals. Our bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of our board of directors. These procedures provide that notice of stockholder nominations or proposals must be timely given in writing to our corporate secretary prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary date of the date on which we first mailed our proxy materials for the annual meeting for the preceding year. Our bylaws will specify the requirements as to form and content of all stockholders’ notices. These requirements may make it more difficult for stockholders to bring matters before the stockholders at an annual or special meeting.

The provisions of our certificate of incorporation and bylaws could have the effect of discouraging others from attempting hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our management. It is possible that these provisions could make it more difficult to accomplish transactions which stockholders may otherwise deem to be in their best interests.

Amendments to Our Certificate of Incorporation or our Bylaws

Our certificate of incorporation may be amended as allowed by the DGCL. Our bylaws contain provisions allowing our board of directors to amend and repeal the bylaws. The holders of our common stock may also amend the bylaws upon the affirmative vote of the holders of a majority of the total voting power of the shares entitled to vote in the election of directors, voting together as a single class.

Business Combinations with Interested Stockholders

In general, Section 203 of the DGCL prevents an interested stockholder, which is defined generally as a person owning 15% or more of the outstanding voting stock of a Delaware corporation, from engaging in a business combination (as defined therein) for three years following the date that such person became an interested

    5

stockholder unless various conditions are satisfied. We have elected to opt out of the provisions of DGCL Section 203. Accordingly, we are not subject to the anti-takeover effects of DGCL Section 203.

Exclusive Forum

Our certificate of incorporation requires, to the fullest extent permitted by law, that derivative actions brought in our name, actions against directors, officers and other employees for breach of a fiduciary duty and other similar actions may be brought only in specified courts in the State of Delaware. Although we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against our directors, officers and other employees.

Limitation of Liability and Indemnification Matters

Our certificate of incorporation limits the liability of our directors for monetary damages for breach of their fiduciary duty as directors, except for the following liabilities that cannot be eliminated under the DGCL:

•for any breach of their duty of loyalty to us or our stockholders;

•for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

•for an unlawful payment of dividends or an unlawful stock purchase or redemption, as provided under Section 174 of the DGCL; or

•for any transaction from which the director derived an improper personal benefit.

Any amendment or repeal of these provisions will be prospective only and would not affect any limitation on liability of a director for acts or omissions that occurred prior to any such amendment or repeal.

Our certificate of incorporation and bylaws also provide that we will indemnify our directors and officers to the fullest extent permitted by Delaware law; provided that we shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the board of directors. Our bylaws also explicitly authorize us to purchase insurance to protect any of our officers, directors, employees or agents or any person who is or was serving at our request as an officer, director, employee or agent of another enterprise for any expense, liability or loss, regardless of whether Delaware law would permit indemnification.

We entered into indemnification agreements with each of our directors and officers. The agreements provide that we will indemnify and hold harmless each indemnitee for certain expenses to the fullest extent permitted or authorized by law, including the DGCL, in effect on the date of the agreement or as it may be amended to provide more advantageous rights to the indemnitee. If such indemnification is unavailable as a result of a court decision and if we and the indemnitee are jointly liable in the proceeding, we will contribute funds to the indemnitee for his or her expenses in proportion to relative benefit and fault of us and the indemnitee in the transaction giving rise to the proceeding. The indemnification agreements also provide that (i) we will indemnify the indemnitee for monetary damages for actions taken as our director or officer or for serving at our request as a director or officer or another position at another corporation or enterprise, as the case may be; and (ii) we must advance payment of certain expenses to the indemnitee, including fees of counsel, subject to receipt of an undertaking from the indemnitee to return such advance if it is it is ultimately determined that the indemnitee is not entitled to indemnification.

We believe that the limitation of liability provision included in our certificate of incorporation and the indemnification agreements will facilitate our ability to continue to attract and retain qualified individuals to serve as our directors and officers.

    6

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Walter J. Scheller, III, Chief Executive Officer, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Warrior Met Coal, Inc. (the “registrant”);
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
				WARRIOR MET COAL, INC.
Date: May 1, 2024			By:	/s/ Walter J. Scheller, III
				Walter J. Scheller, III
				Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Dale W. Boyles, Chief Financial Officer, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Warrior Met Coal, Inc. (the “registrant”);
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
				WARRIOR MET COAL, INC.
Date: May 1, 2024			By:	/s/ Dale W. Boyles
				Dale W. Boyles
				Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officers of Warrior Met Coal, Inc. (the “Company”), do hereby certify, to such officer’s knowledge, that:

The Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 (the “Form 10-Q”) of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

		WARRIOR MET COAL, INC.
Date: May 1, 2024	By:	/s/ Walter J. Scheller, III
		Walter J. Scheller, III
		Chief Executive Officer
Date: May 1, 2024	By:	/s/ Dale W. Boyles
		Dale W. Boyles
		Chief Financial Officer

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Exchange Act or otherwise subject to liability under that section. This certification shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended or the Exchange Act, except to the extent that the Company specifically incorporates it by reference.

EX-95

Exhibit 95

Item 4. Mine Safety Disclosures

Mine Safety and Health Administration Safety Data

Warrior Met Coal, Inc. ("we", "our", or the "Company") is committed to the safety of its employees and the goal of providing an incident-free workplace. To that end, the Company has in place health and safety programs that include regulatory-based training, accident prevention, workplace inspection, emergency preparedness response, accident investigations, and program auditing. These programs are designed to comply with regulatory mining-related coking coal safety and environmental standards. Additionally, the programs provide a basis for promoting a best-in-industry safety practice.

The operation of our mines is subject to regulation by the Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”). MSHA inspects our mines on a continual basis and issues various citations and orders when it believes a violation has occurred under the Mine Act. As required by Section 1503 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, each operator of a coal or other mine is required to include certain mine safety results in its periodic reports filed with the Securities and Exchange Commission (the "SEC"). Within this disclosure, we present information regarding certain mining safety and health citations which MSHA has issued with respect to our mining operations. In evaluating this information, consideration should be given to factors such as: (i) the number of citations and orders will vary depending on the size of the coal mine, (ii) the number of citations issued will vary from inspector to inspector and mine to mine, and (iii) citations and orders can be contested and appealed and, in that process, are sometimes dismissed and remaining citations are often reduced in severity and civil penalty amount.

Duringthe quarter ended March 31, 2024, none of the Company’s mining complexes received written notice from MSHA of (i) a pattern of violations of mandatory health or safety standards that are of such nature as could have significantly and substantially contributed to the cause and effect of coal or other mine health or safety hazards under section 104(e) of the Mine Act or (ii) the potential to have such a pattern.

The first table below presents the total number of specific citations and orders issued by MSHA to the Company and its subsidiaries, together with the total dollar value of the proposed MSHA civil penalty assessments received, during the quarter ended March 31, 2024. The second table presents legal actions pending before the Federal Mine Safety and Health Review Commission ("FMSHRC") for each of our mines as of March 31, 2024, together with the number of legal actions initiated and the number of legal actions resolved during the quarter ended March 31, 2024.

Mining Complex(1) (3)	Section 104 S&S Citations	Section 104(b) Orders	Section 104(d) Citations and Orders	Section 110(b)(2) Violations	Section 107(a) Orders	Proposed MSHA Assessments(2) ($ in thousands)	Fatalities
Warrior Met Coal Mining, LLC, No. 4	49	—	1	—	—	216.0	—
Warrior Met Coal Mining, LLC, No. 7	37	—	—	—	—	109.0	—
Warrior Met Coal BC, LLC	—	—	—	—	—	—	—

(1)MSHA assigns an identification number to each coal mine and may or may not assign separate identification numbers to related facilities such as preparation plants. We are providing the information in the table by mining complex rather than MSHA identification number because we believe that this presentation is more useful to investors. For descriptions of each of these mining operations, please refer to the descriptions under "Part 1, Item 1. Business" and "Part 1, Item 2. Properties" in our Annual Report on Form 10-K for the year ended December 31, 2022. Idle facilities are not included in the table above unless they received a citation, order or assessment by MSHA during the current quarterly reporting period or are subject to pending legal actions.

(2)Not all citations issued during the quarter have been assessed a civil penalty. Thus, amounts listed under this heading are based on assessments that have been proposed, projected proportionally for all enforcement actions issued during the quarter, both Significant and Substantial ("S&S") and non-S&S, regardless of the issuance date of the related citation or order.

(3)The table includes references to specific sections of the Mine Act as follows:

•Section 104(a) Citations include citations for health or safety standards that could significantly and substantially contribute to serious injury if left unabated.

•Section 104(b) Orders represent failures to abate a citation under 104(a) within the period of time prescribed by MSHA and that the period of time prescribed for the abatement should not be further extended. This results in an order of immediate withdrawal from the area of the mine affected by the condition until MSHA determines that the violation has been abated.

•Section 104(d) Citations and Orders are for unwarrantable failure to comply with mandatory health and safety standards where such violation is of such a nature as could significantly or substantially contribute to the cause and effect of a coal or other mine safety or health hazard.

•Section 110(b)(2) Violations are for flagrant violations.

•Section 107(a) Orders are for situations in which MSHA determined an imminent danger existed.

Mining Complex Legal Actions(1)	Pending as of March 31, 2024	Initiated During Q1 2024	Resolved During Q1 2024
Warrior Met Coal Mining, LLC, No. 4
29 CFR Part 2700, Subpart B	—	—	—
29 CFR Part 2700, Subpart C	12	3	4
29 CFR Part 2700, Subpart D	—	—	—
29 CFR Part 2700, Subpart E	2	—	—
29 CFR Part 2700, Subpart F	—	—	—
29 CFR Part 2700, Subpart H	—	—	1
Warrior Met Coal Mining, LLC, No. 7
29 CFR Part 2700, Subpart B	—	—	—
29 CFR Part 2700, Subpart C	22	3	4
29 CFR Part 2700, Subpart D	—	—	—
29 CFR Part 2700, Subpart E	6	—	—
29 CFR Part 2700, Subpart F	—	—	—
29 CFR Part 2700, Subpart H	—	—	—
Warrior Met Coal BC, LLC
29 CFR Part 2700, Subpart B	—	—	—
29 CFR Part 2700, Subpart C	—	—	—
29 CFR Part 2700, Subpart D	—	—	—
29 CFR Part 2700, Subpart E	—	—	—
29 CFR Part 2700, Subpart F	—	—	—
29 CFR Part 2700, Subpart H	—	—	—

(1)Effective January 27, 2011, the SEC adopted amendments to its rules to implement Section 1503 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “final rule”). The final rule modified previous reporting requirements and requires that the total number of legal actions pending before the FMSHRC as of the last day of the time period covered by the report be categorized according to type of proceeding, in accordance with the categories established in the Procedural Rules of FMSHRC. SEC rules require that six different categories of pending legal actions be disclosed. The types of proceedings are listed as follows:

•“29 CFR Part 2700, Subpart B” These legal actions include proceedings initiated under FMSHRC Procedural Rule 29 CFR Part 2700, Subpart B such as contests of citations and orders filed prior to receipt of a proposed penalty assessment from MSHA, contests related to orders for which penalties are not assessed (such as imminent danger orders under Section 107 of the Mine Act), and emergency response plan dispute proceedings.

•“29 CFR Part 2700, Subpart C” These legal actions include proceedings initiated under FMSHRC Procedural Rule 29 CFR Part 2700, Subpart C and are contests of citations and orders after receipt of proposed penalties.

•“29 CFR Part 2700, Subpart D” These legal actions include proceedings initiated under FMSHRC Procedural Rule 29 CFR Part 2700, Subpart D and are complaints for compensation, which are cases under section 111 of the Mine Act.

•“29 CFR Part 2700, Subpart E” These legal actions include proceedings initiated under FMSHRC Procedural Rule 29 CFR Part 2700, Subpart E and are complaints of discharge, discrimination or interference and temporary reinstatement under section 105 of the Mine Act.

•“29 CFR Part 2700, Subpart F” These legal actions include proceedings initiated under FMSHRC Procedural Rule 29 CFR Part 2700, Subpart F such as applications for temporary relief under section 105(b)(2) of the Mine Act from any modification or termination of any order issued thereunder, or from any order issued under section 104 of the Mine Act (other than citations issued under section 104(a) or (f) of the Mine Act).

•“29 CFR Part 2700, Subpart H” These legal actions include proceedings initiated under FMSHRC Procedural Rule 29 CFR Part 2700, Subpart H and are appeals of judges’ decisions or orders to FMSHRC, including petitions for discretionary review and review by FMSHRC on its own motion.

XML

Cover - shares	3 Months Ended
	Mar. 31, 2024	Apr. 29, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-38061
Entity Registrant Name	Warrior Met Coal, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	81-0706839
Entity Address, Address Line One	16243 Highway 216
Entity Address, City or Town	Brookwood
Entity Address, State or Province	AL
Entity Address, Postal Zip Code	35444
City Area Code	205
Local Phone Number	554-6150
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		52,300,707
Entity Central Index key	0001691303
Document Fiscal Year Focus	2024
Amendment Flag	false
Document Fiscal Period Focus	Q1
Current Fiscal Year End Date	--12-31
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common Stock, par value $.01 per share
Trading Symbol	HCC
Security Exchange Name	NYSE
Preferred Stock
Document Information [Line Items]
Title of 12(b) Security	Rights to Purchase Series A Junior Participating Preferred Stock, par value $0.01 per share
Security Exchange Name	NYSE
No Trading Symbol Flag	true

XML

CONDENSED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenues:
Total revenues	$ 503,512	$ 509,674
Costs and expenses:
Cost of sales (exclusive of items shown separately below)	285,587	232,630
Cost of other revenues (exclusive of items shown separately below)	9,965	11,438
Depreciation and depletion	40,023	37,213
Selling, general and administrative	18,658	14,516
Business interruption	201	4,217
Total costs and expenses	354,434	300,014
Operating income	149,078	209,660
Interest expense	(1,121)	(7,443)
Interest income	8,154	8,903
Other income	0	221
Income before income tax expense	156,111	211,341
Income tax expense	19,122	29,064
Net income	$ 136,989	$ 182,277
Basic and diluted net income per share:
Net income per share-basic (in dollars per share)	$ 2.63	$ 3.52
Net income per share-diluted (in dollars per share)	$ 2.62	$ 3.51
Weighted average number of shares outstanding-basic (in shares)	52,163	51,842
Weighted average number of shares outstanding-diluted (in shares)	52,217	51,956
Dividends per share (in dollars per share)	$ 0.58	$ 0.95
Sales
Revenues:
Total revenues	$ 497,998	$ 500,491
Other revenues
Revenues:
Total revenues	$ 5,514	$ 9,183

XML

CONDENSED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 693,858	$ 738,197
Short-term investments	9,149	9,030
Trade accounts receivable	213,400	98,225
Income tax receivable	0	7,833
Inventories, net	165,650	183,949
Prepaid expenses and other receivables	37,200	31,932
Total current assets	1,119,257	1,069,166
Mineral interests, net	78,428	80,442
Property, plant and equipment, net	1,253,395	1,179,609
Non-current income tax receivable	0	0
Deferred income taxes	5,752	5,854
Other long-term assets	21,759	21,987
Total assets	2,478,591	2,357,058
Current liabilities:
Accounts payable	43,184	36,245
Accrued expenses	80,944	81,612
Asset retirement obligations	12,500	12,500
Short-term financing lease liabilities	11,357	11,463
Other current liabilities	15,057	5,850
Current portion of long-term debt	0	0
Total current liabilities	163,042	147,670
Long-term debt	153,166	153,023
Asset retirement obligations	71,916	71,666
Black Lung obligations	27,125	26,966
Long-term financing lease liabilities	7,708	8,756
Deferred income taxes	77,434	74,531
Other long-term liabilities	0	0
Total liabilities	500,391	482,612
Stockholders’ Equity:
Common stock, $0.01 par value, (140,000,000 shares authorized as of March 31, 2024 and December 31, 2023; 54,519,114 issued and 52,297,273 outstanding as of March 31, 2024; 54,240,764 issued and 52,018,923 outstanding as of December 31, 2023)	545	542
Preferred stock, $0.01 par value per share (10,000,000 shares authorized; no shares issued and outstanding)	0	0
Treasury stock, at cost (2,221,841 shares as of March 31, 2024 and December 31, 2023)	(50,576)	(50,576)
Additional paid in capital	276,731	279,332
Retained earnings	1,751,500	1,645,148
Total stockholders’ equity	1,978,200	1,874,446
Total liabilities and stockholders’ equity	$ 2,478,591	$ 2,357,058

XML

CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock authorized (in shares)	140,000,000	140,000,000
Common stock issued (in shares)	54,519,114	54,240,764
Common stock outstanding (in shares)	52,297,273	52,018,923
Preferred stock outstanding (in shares)	0	0
Preferred stock issued (in shares)	0	0
Preferred stock authorized (in shares)	10,000,000	10,000,000
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Treasury stock (in shares)	2,221,841	2,221,841

XML

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands	Total	Common Stock	Preferred Stock	Treasury Stock	Additional Paid in Capital	Retained Earnings
Balance, beginning of period at Dec. 31, 2022		$ 539	$ 0	$ (50,576)	$ 269,956	$ 1,227,596
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of shares		0
Stock based compensation expense					7,713
Net income	$ 182,277					182,277
Dividends paid						(50,016)
Tax withholdings on vested equity awards					(9,198)
Balance, end of period at Mar. 31, 2023	1,578,291	539	0	(50,576)	268,471	1,359,857
Balance, beginning of period at Dec. 31, 2023	1,874,446	542	0	(50,576)	279,332	1,645,148
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of shares		3
Stock based compensation expense					9,179
Net income	136,989					136,989
Dividends paid						(30,638)
Tax withholdings on vested equity awards					(11,779)
Balance, end of period at Mar. 31, 2024	$ 1,978,200	$ 545	$ 0	$ (50,576)	$ 276,732	$ 1,751,499

XML

CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
OPERATING ACTIVITIES
Net income	$ 136,989	$ 182,277
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and depletion	40,023	37,213
Deferred income tax expense	2,909	29,064
Stock based compensation expense	9,152	7,702
Amortization of debt issuance costs and debt discount	393	713
Accretion of asset retirement obligations	1,297	906
Mark-to-market gain on gas hedges	0	(500)
Changes in operating assets and liabilities:
Trade accounts receivable	(115,175)	(56,804)
Income tax receivable	7,833	0
Inventories	16,162	17,406
Prepaid expenses and other receivables	(5,267)	(3,140)
Accounts payable	5,631	(8,463)
Accrued expenses and other current liabilities	5,046	(18,032)
Other	(935)	4,592
Net cash provided by operating activities	104,058	192,934
INVESTING ACTIVITIES
Purchase of property, plant and equipment	(99,703)	(68,179)
Deferred mine development costs	(1,987)	(14,458)
Acquisition of gas well ownership interest	0	(2,381)
Net cash used in investing activities	(101,690)	(85,018)
FINANCING ACTIVITIES
Dividends paid	(30,638)	(50,016)
Retirements of debt	0	(8,000)
Principal repayments of finance lease obligations	(4,292)	(7,634)
Payments for taxes related to net share settlement of equity awards	(11,777)	(9,198)
Net cash used in financing activities	(46,707)	(74,848)
Net (decrease) increase in cash and cash equivalents	(44,339)	33,068
Cash and cash equivalents at beginning of period	738,197	829,480
Cash and cash equivalents at end of period	$ 693,858	$ 862,548

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Business and Basis of Presentation

3 Months Ended

Mar. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business and Basis of Presentation

Business and Basis of Presentation

Description of the Business

Warrior Met Coal, Inc. (the "Company") is a U.S.-based, environmentally and socially minded supplier to the global steel industry. The Company is dedicated entirely to mining non-thermal met steelmaking coal used as a critical component of steel production by metal manufacturers in Europe, South America and Asia. The Company is a large-scale, low-cost producer and exporter of premium quality met coal, also known as hard-coking coal ("HCC"), operating highly efficient longwall operations in its underground mines based in Alabama. The HCC that the Company produces from the Blue Creek coal seam contains very low sulfur and has strong coking properties. The Company also generates ancillary revenues from the sale of natural gas extracted as a byproduct from the underground coal mines and royalty revenues from leased properties.

Basis of Presentation

The accompanying financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion, the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. For further information, refer to the financial statements and related notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Annual Report"). Operating results for the three months ended March 31, 2024 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2024. The balance sheet at December 31, 2023 has been derived from the audited financial statements for the year ended December 31, 2023 included in the 2023 Annual Report.

Collective Bargaining Agreement

The Company's Collective Bargaining Agreement ("CBA") with the labor union representing certain of the Company's hourly employees expired on April 1, 2021 and the labor union initiated a strike after an agreement on a new contract was not reached. As a result of the strike, the Company initially idled Mine No. 4 and scaled back operations at Mine No. 7. In the first quarter of 2022, the Company restarted operations at Mine No. 4. On February 16, 2023, the labor union representing certain of the Company's hourly employees announced that they were ending the strike and made an unconditional offer to return to work. The Company incurred business interruption expenses of approximately $0.2 million for the three months ended March 31, 2024, which represent ongoing legal expenses associated with ongoing labor negotiations. The Company incurred $4.2 million for the three months ended March 31, 2023, which represent non-recurring expenses that were directly attributable to the labor strike for incremental safety and security, labor negotiations and other expenses. These expenses are presented separately in the Condensed Statements of Operations. The Company continues to engage in good faith efforts with the labor union to reach an agreement on a new contract.

Acquisitions

On March 31, 2023, the Company acquired the remaining ownership interest in gas wells owned by an independent third party for $2.4 million. The purchase consideration was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of acquisition. The acquisition is not deemed to be material to the condensed financial statements.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

The Company's significant accounting policies are consistent with those disclosed in Note 2 to its audited financial statements included in the 2023 Annual Report.

Use of Estimates

The Company prepares its financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Due to the inherent uncertainty involved in making estimates, actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents include short-term deposits and highly liquid investments that have original maturities of three months or less when purchased and are stated at cost, which approximates fair value.

Short-Term Investments

Instruments with maturities greater than three months, but less than twelve months, are included in short-term investments. The Company also purchases fixed income securities and certificates of deposits with varying maturities that are classified as available for sale and are carried at fair value. Securities classified as held to maturity are those securities that management has the intent and ability to hold to maturity.

As of March 31, 2024 and December 31, 2023, short-term investments consisted of $9.1 million and $9.0 million in cash and fixed income securities. The short-term investments are posted as collateral for the self-insured black lung related claims asserted by or on behalf of former employees of Walter Energy, Inc. ("Walter Energy") and its subsidiaries, which were assumed by the Company and relate to periods prior to March 31, 2016.

Revenue Recognition

    Revenue is recognized when performance obligations under the terms of a contract with the Company's customers are satisfied; for all contracts this occurs when control of the promised goods have been transferred to the Company's customers and risk of loss passes such customers. For coal shipments to domestic customers via rail, control is transferred when the railcar is loaded. For coal shipments to international customers via ocean vessel, control is transferred when the vessel is loaded at the Port of Mobile in Alabama. Occasionally, the Company will sell coal stockpiles at the barge loadout or port upon which control, title and risk of loss transfers when stockpiles are segregated. For all steelmaking coal sales under average pricing contracts where pricing is not finalized when revenue is recognized, revenue is recorded based on estimated consideration to be received at the date of the sale. For natural gas sales, control is transferred when the gas has been transferred to the pipeline. Revenue is disaggregated between coal sales within the Company's mining segment and natural gas sales included in all other revenues, as disclosed in Note 12.

The Company's coal and gas sales generally include up to 45-day payment terms following the transfer of control of the goods to the customer. The Company typically does not include extended payment terms in its contracts with customers.

Trade Accounts Receivable and Allowance for Credit Losses

    Trade accounts receivable are stated at cost. Trade accounts receivable represent customer obligations that are derived from revenue recognized from contracts with customers. Credit is extended based on an evaluation of the individual customer's financial condition. The Company maintains trade credit insurance on the majority of its customers and the geographic regions of coal shipments to these customers. In some instances, the Company requires letters of credit, cash collateral or prepayments from its customers on or before shipment to mitigate the risk of loss. These efforts have consistently resulted in the Company recognizing no historical credit losses. The Company also has never had to have a claim against its trade credit insurance policy.

In order to estimate the allowance for credit losses on trade accounts receivable, the Company utilizes an aging approach in which potential impairment is calculated based on how long a receivable has been outstanding (e.g., current, 1-31 days, 31-60 days, etc.). The Company calculates an expected credit loss rate based on the Company’s historical credit loss rate, the risk characteristics of its customers, and the current steelmaking coal and steel market environments. As of March 31, 2024 and December 31, 2023, the estimated allowance for credit losses was immaterial and did not have a material impact on the Company's financial statements.

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Inventories, net

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Inventories, net

Inventories, net

Inventories, net are summarized as follows (in thousands):

	March 31, 2024		December 31, 2023
Coal	$	110,438	$	129,989
Raw materials, parts, supplies and other, net	55,212		53,960
Total inventories, net	$	165,650	$	183,949

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Income Taxes

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

For the three months ended March 31, 2024 and 2023, the Company estimated its annual effective tax rate and applied this effective tax rate to its year-to-date pretax income at the end of the interim reporting period. The tax effect of unusual or infrequently occurring items, including the effects of changes in tax laws or rates and changes in judgment about the realizability of deferred tax assets, are reported in the interim period in which they occur. For the three months ended March 31, 2024 and 2023, the Company had income tax expense of $19.1 million and $29.1 million, respectively.

The $19.1 million and $29.1 million income tax expense for the three months ended March 31, 2024 and 2023, includes a benefit related to depletion and Internal Revenue Code ("IRC") Section 250 Deduction: Foreign-Derived Intangible Income ("FDII"). The Tax Cuts and Jobs Act ("TCJA") was enacted on December 22, 2017 and enacted IRC Section 250 Deduction: FDII, which provides for, among other things, a deduction of 37.5% with respect to foreign-derived intangible income, which reduces the statutory tax rate from 21% to 13.125%. Beginning in 2026, the deduction is reduced from 37.5% to 22.5% of foreign-derived intangible income. The Company has historically not been eligible to claim the deduction due to the deduction being limited to taxable income and the Company's ability to utilize its net operating losses to offset taxable income.

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Debt

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Debt

Debt

The Company's debt consisted of the following (in thousands):

	March 31, 2024		December 31, 2023		Weighted Average Interest Rate	Final Maturity
Senior Secured Notes	$	156,517	$	156,517	7.875%	December 2028
ABL Borrowings	—		—		Varies(1)	December 2026
Debt discount	(3,351)		(3,494)
Total debt	153,166		153,023
Less: current debt	—		—
Total long-term debt	$	153,166	$	153,023

(1) Borrowings under the ABL Facility bear interest at a rate equal to Secured Overnight Financing Rate ("SOFR") ranging from 1.5% to 2.0%, plus a credit adjustment spread, ranging currently from 0.11448% to 0.42826%, or an alternate base rate plus an applicable margin, which is determined based on the average availability of the commitments under the ABL Facility, ranging from 0.5% to 1.0%.

Senior Secured Notes

On December 6, 2021, the Company issued $350.0 million in aggregate principal amount of 7.875% senior secured notes due 2028 (the “Notes”) at an initial price of 99.343% of their face amount. The Notes were issued to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to certain non-U.S. persons in transactions outside the United States in accordance with Regulation S under the Securities Act. The Company used the net proceeds of the offering of the Notes, together with cash on hand, to fund the redemption of all of the Company’s outstanding 8.00% senior secured notes due 2024 (the “Existing Notes”), including payment of the redemption premium in connection with such redemption. The Notes will mature on December 1, 2028.

During the three months ended March 31, 2023, the Company repurchased in the open market and extinguished approximately $8.0 million principal amount of our Notes. In connection with the extinguishment of our Notes, we recognized a loss on early extinguishment of debt of $0.1 million which is included in interest expense in the Condensed Statements of Operations.

ABL Facility

On December 6, 2021, the Company entered into the Second Amended and Restated Asset-Based Revolving Credit Agreement (the “Second Amended and Restated Credit Agreement”), by and among the Company and certain of its subsidiaries, as borrowers, the guarantors party thereto, the lenders from time to time party thereto and Citibank, as administrative agent (in such capacity, the "Agent"), which amends and restates in its entirety the then existing Amended and Restated Asset-Based Revolving Credit Agreement (as amended, the “ABL Facility”). The Second Amended and Restated Credit Agreement, among other things, (i) extended the maturity date of the ABL Facility to December 6, 2026; (ii) changed the calculation of the interest rate payable on borrowings from being based on a London Inter-Bank Offered Rate to be based on a SOFR, with corresponding changes to the applicable interest rate margins with respect to such borrowings, (iii) amended certain definitions related to the calculation of the borrowing base; (iv) increased the commitments that may be used to issue letters of credit to $65.0 million; and (v) amended certain baskets contained in the covenants to conform to the baskets contained in the indenture governing the Notes (the "Indenture"). The Second Amended and Restated Credit Agreement also allows the Company to borrow up to $116.0 million through November 2026, subject to availability under the borrowing base and other conditions.

As of March 31, 2024, no loans were outstanding under the ABL Facility and there were $8.7 million of letters of credit issued and outstanding under the ABL Facility. At March 31, 2024, the Company had $107.4 million of availability under the ABL Facility (calculated net of $8.7 million of letters of credit outstanding at such time).

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Leases

3 Months Ended

Mar. 31, 2024

Leases [Abstract]

Leases

Leases

The Company primarily enters into rental agreements for certain mining equipment that are for periods of 12 months or less, some of which include options to extend the leases. Leases that are for periods of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense on these agreements on a straight-line basis over the lease term. Additionally, the Company has certain finance leases for mining equipment that expire over various contractual periods. These leases have remaining lease terms of one to five years and do not include an option to renew. Amortization expense for finance leases is included in depreciation and depletion expense.

Supplemental balance sheet information related to leases was as follows (in thousands):

	March 31, 2024			December 31, 2023
Finance lease right-of-use assets, net(1)	$	64,406		$	67,014
Finance lease liabilities
Current	11,357			11,463
Noncurrent	7,708			8,756
Total finance lease liabilities	$	19,065		$	20,219
Weighted average remaining lease term - finance leases (in months)	20.0			20.8
Weighted average discount rate - finance leases(2)	7.02		%	7.02		%

(1) Finance lease right-of-use assets are recorded net of accumulated amortization of $42.2 million and $38.5 million and are included in property, plant and equipment, net in the Condensed Balance Sheets as of March 31, 2024 and the Balance Sheets as of December 31, 2023, respectively.

(2) When an implicit discount rate is not readily available in a lease, the Company uses its incremental borrowing rate based on information available at the commencement date when determining the present value of lease payments.

The components of lease expense were as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Operating lease cost(1):	$	12,606	$	6,430
Finance lease cost:
Amortization of leased assets	5,758		5,280
Interest on lease liabilities	351		638
Net lease cost	$	18,715	$	12,348

(1) Includes leases that are for periods of 12 months or less.

Maturities of lease liabilities for the Company's finance leases as of March 31, 2024 were as follows (in thousands):

	Finance Leases(1)
2024	$	14,208
2025	4,598
2026	1,052
2027	—
Thereafter	—
Total	19,858
Less: amount representing interest	(793)
Present value of lease liabilities	$	19,065

(1) Finance lease payments include $3.0 million of future payments required under signed lease agreements that have not yet commenced.

Supplemental cash flow information related to the Company's leases was as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	351	$	638
Financing cash flows from finance leases	$	4,292	$	7,634
Non-cash right-of-use assets obtained in exchange for lease obligations:
Finance leases	$	3,138	$	2,158

Leases

Leases

The Company primarily enters into rental agreements for certain mining equipment that are for periods of 12 months or less, some of which include options to extend the leases. Leases that are for periods of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense on these agreements on a straight-line basis over the lease term. Additionally, the Company has certain finance leases for mining equipment that expire over various contractual periods. These leases have remaining lease terms of one to five years and do not include an option to renew. Amortization expense for finance leases is included in depreciation and depletion expense.

Supplemental balance sheet information related to leases was as follows (in thousands):

	March 31, 2024			December 31, 2023
Finance lease right-of-use assets, net(1)	$	64,406		$	67,014
Finance lease liabilities
Current	11,357			11,463
Noncurrent	7,708			8,756
Total finance lease liabilities	$	19,065		$	20,219
Weighted average remaining lease term - finance leases (in months)	20.0			20.8
Weighted average discount rate - finance leases(2)	7.02		%	7.02		%

(1) Finance lease right-of-use assets are recorded net of accumulated amortization of $42.2 million and $38.5 million and are included in property, plant and equipment, net in the Condensed Balance Sheets as of March 31, 2024 and the Balance Sheets as of December 31, 2023, respectively.

(2) When an implicit discount rate is not readily available in a lease, the Company uses its incremental borrowing rate based on information available at the commencement date when determining the present value of lease payments.

The components of lease expense were as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Operating lease cost(1):	$	12,606	$	6,430
Finance lease cost:
Amortization of leased assets	5,758		5,280
Interest on lease liabilities	351		638
Net lease cost	$	18,715	$	12,348

(1) Includes leases that are for periods of 12 months or less.

Maturities of lease liabilities for the Company's finance leases as of March 31, 2024 were as follows (in thousands):

	Finance Leases(1)
2024	$	14,208
2025	4,598
2026	1,052
2027	—
Thereafter	—
Total	19,858
Less: amount representing interest	(793)
Present value of lease liabilities	$	19,065

(1) Finance lease payments include $3.0 million of future payments required under signed lease agreements that have not yet commenced.

Supplemental cash flow information related to the Company's leases was as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	351	$	638
Financing cash flows from finance leases	$	4,292	$	7,634
Non-cash right-of-use assets obtained in exchange for lease obligations:
Finance leases	$	3,138	$	2,158

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Net Income per Share

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Net Income per Share

Net Income per Share

Basic and diluted net income per share was calculated as follows (in thousands, except per share data):

	For the three months ended March 31,
	2024		2023
Numerator:
Net income	$	136,989	$	182,277
Denominator:
Weighted-average shares used to compute net income per share—basic	52,163		51,842
Dilutive restrictive stock awards	54		114
Weighted-average shares used to compute net income per share—diluted	52,217		51,956
Net income per share—basic	$	2.63	$	3.52
Net income per share—diluted	$	2.62	$	3.51

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Environmental Matters

The Company is subject to a wide variety of laws and regulations concerning the protection of the environment, both with respect to the construction and operation of its plants, mines and other facilities and with respect to remediating environmental conditions that may exist at its own and other properties.

The Company believes it is in compliance with federal, state and local environmental laws and regulations. The Company accrues for environmental expenses resulting from existing conditions that relate to past operations when the costs are probable and can be reasonably estimated. As of March 31, 2024 and December 31, 2023, there were no accruals for environmental matters other than asset retirement obligations for mine reclamation.

Miscellaneous Litigation

From time to time, the Company is party to lawsuits arising in the ordinary course of business. The Company records costs relating to these matters when a loss is probable and the amount can be reasonably estimated. The effect of the outcome of these matters on the Company’s future results of operations cannot be predicted with certainty as any such effect depends on future results of operations and the amount and timing of the resolution of such matters. As of March 31, 2024 and December 31, 2023, there were no items accrued for miscellaneous litigation.

On July 15, 2015, Walter Energy and certain of its wholly owned U.S. subsidiaries, including Jim Walter Resources, Inc. (“JWR”) filed voluntary petitions for relief under chapter 11 of title 11 of the U.S. Bankruptcy Code (the “Chapter 11 Cases”) in the Northern District of Alabama, Southern Division. On December 7, 2015, Walter Energy Canada Holdings, Inc., Walter Canadian Coal Partnership and their Canadian affiliates (collectively “Walter Canada”) applied for and were granted protection under the Companies’ Creditors Arrangement Act (the “CCAA”) pursuant to an Initial Order of the Supreme Court

of British Columbia. As a result of the Company’s acquisition of certain core operating assets of Walter Energy during the Chapter 11 Cases, in the first quarter of 2023 the Company received $0.2 million from the Chapter 11 Cases which is reflected as other income in the Condensed Statement of Operations.

Other Commitments and Contingencies

The Company is party to various transportation and throughput agreements with rail and barge transportation providers and the Alabama State Port Authority. These agreements contain annual minimum tonnage guarantees with respect to coal transported from the mine sites to the Port of Mobile, Alabama, the unloading of rail cars or barges, and the loading of vessels. If the Company does not meet its minimum throughput obligations, which are based on annual minimum amounts, it is required to pay the transportation providers or the Alabama State Port Authority a contractually specified amount per metric ton for the difference between the actual throughput and the minimum throughput requirement. At March 31, 2024 and December 31, 2023, the Company had no liability recorded for minimum throughput requirements.

Royalty Obligations

A substantial amount of the coal that the Company mines is produced from mineral reserves leased from third-party landowners. These leases convey mining rights to the Company in exchange for royalties to be paid to the landowner as either a fixed amount per ton or as a percentage of the sales price. Although coal leases have varying renewal terms and conditions, they generally last for the economic life of the reserves. Coal royalty expenses were $42.9 million and $33.2 million for the three months ended March 31, 2024 and 2023, respectively.

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Stockholders' Equity

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Stockholders' Equity

Stockholders' Equity

Common Shares

The Company is authorized to issue up to 140,000,000 common shares, $0.01 par value per share. Holders of common shares are entitled to receive dividends when authorized by the Board.

Stock Repurchase Program

On March 26, 2019, the Board approved the Company's second stock repurchase program (the “New Stock Repurchase Program”) that authorizes repurchases of up to an aggregate of $70.0 million of the Company's outstanding common stock. The Company fully exhausted its previous stock repurchase program (the "First Stock Repurchase Program") of $40.0 million of its outstanding common stock. The New Stock Repurchase Program does not require the Company to repurchase a specific number of shares or have an expiration date. The New Stock Repurchase Program may be suspended or discontinued by the Board at any time without prior notice.

    Under the New Stock Repurchase Program, the Company may repurchase shares of its common stock from time to time, in amounts, at prices and at such times as the Company deems appropriate, subject to market and industry conditions, share price, regulatory requirements and other considerations as determined from time to time by the Company. The Company’s repurchases may be executed using open market purchases or privately negotiated transactions in accordance with applicable securities laws and regulations, including Rule 10b-18 of the Exchange Act and repurchases may be executed pursuant to Rule 10b5-1 under the Exchange Act. Repurchases will be subject to limitations in the ABL Facility and the Indenture. The Company intends to fund repurchases under the New Stock Repurchase Program from cash on hand and/or other sources of liquidity. Any future repurchases of shares of the Company's common stock will be subject to the 1% excise tax under the Inflation Reduction Act.

As of March 31, 2024 and December 31, 2023, the Company has repurchased 500,000 shares under the New Stock Repurchase Program for approximately $10.6 million, leaving approximately $59.4 million of share repurchases authorized under the New Stock Repurchase Program.

Dividends

The Company has declared the following dividends on common shares as of the filing date of this Form 10-Q:

Dividend per Share		Dividends Paid		Dividend Type	Declaration Date	Record Date	Payable Date
		(in millions)
$	0.07	$	3.6	Quarterly	February 9, 2023	February 20, 2023	February 27, 2023
$	0.88	$	46.4	Special	February 13, 2023	February 28, 2023	March 7, 2023
$	0.07	$	3.7	Quarterly	April 25, 2023	May 5, 2023	May 12, 2023
$	0.07	$	3.7	Quarterly	July 28, 2023	August 7, 2023	August 14, 2023
$	0.07	$	—	Quarterly	October 24, 2023	November 3, 2023	November 10, 2023
$	0.08	$	4.2	Quarterly	February 9, 2024	February 20, 2024	February 26, 2024
$	0.50	$	26.3	Special	February 9, 2024	March 1, 2024	March 7, 2024
$	0.08	$	4.2	Quarterly	April 25, 2024	May 6, 2024	May 13, 2024

Preferred Shares

The Company is authorized to issue up to 10,000,000 shares of preferred stock, $0.01 par value per share.

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Derivative Instruments

3 Months Ended

Mar. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative Instruments

The Company enters into natural gas swap contracts from time to time to hedge the exposure to variability in expected future cash flows associated with the fluctuations in the price of natural gas related to the Company’s forecasted sales. As of March 31, 2024 and December 31, 2023, the Company had no natural gas swap contracts outstanding.

The Company’s natural gas swap contracts economically hedge certain risks but are not designated as hedges for financial reporting purposes. All changes in the fair value of these derivative instruments are recorded as other revenues in the Condensed Statements of Operations. The Company recognized no gains or losses for the three months ended March 31, 2024. The Company recognized a gain related to natural gas swap contracts of $0.7 million, which includes $0.2 million of realized gains, for the three months ended March 31, 2023. The Company records all derivative instruments at fair value and had no asset or liability recorded as of March 31, 2024 and December 31, 2023.

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Fair Value of Financial Instruments

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Company had no significant assets or any other liabilities measured at fair value on a recurring basis as of March 31, 2024 or December 31, 2023. During the three months ended March 31, 2024, there were no transfers between Level 1, Level 2 and Level 3. The Company uses quoted dealer prices for similar contracts in active over-the-counter markets for determining fair value of Level 2 liabilities. There were no changes to the valuation techniques used to measure liability fair values on a recurring basis during the three months ended March 31, 2024.

The following methods and assumptions were used to estimate the fair value for which the fair value option was not elected:

Cash and cash equivalents, short-term investments, receivables and trade accounts payable — The carrying amounts reported in the Condensed Balance Sheets approximate fair value due to the short-term nature of these assets and liabilities.

Debt — The Company's outstanding debt is carried at cost. As of March 31, 2024, there were no borrowings outstanding under the ABL Facility, with $107.4 million available, net of outstanding letters of credit of $8.7 million. As of December 31, 2023, the Company had no borrowings outstanding under the ABL Facility, with $107.4 million available, net of outstanding letters of credit of $8.7 million. As of March 31, 2024 and December 31, 2023, the estimated fair value of the Notes based upon observable market data (Level 2) was approximately $157.7 million and $156.0 million, respectively.

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Segment Information

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company identifies a business as an operating segment if: (i) it engages in business activities from which it may earn revenues and incur expenses; (ii) its operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”), who is the Company’s Chief Executive Officer, to make decisions about resources to be allocated to the segment

and assess its performance; and (iii) it has available discrete financial information. The Company has determined that its two underground mining operations are its operating segments. The CODM reviews financial information at the operating segment level to allocate resources and to assess the operating results and financial performance for each operating segment. Operating segments are aggregated into a reportable segment if the operating segments have similar quantitative economic characteristics and if the operating segments are similar in the following qualitative characteristics: (i) nature of products and services; (ii) nature of production processes; (iii) type or class of customer for their products and services; (iv) methods used to distribute the products or provide services; and (v) if applicable, the nature of the regulatory environment.

The Company has determined that the two operating segments are similar in both quantitative and qualitative characteristics and thus the two operating segments have been aggregated into one reportable segment. The Company has determined that its natural gas and royalty businesses and the Blue Creek mine development did not meet the criteria in ASC 280 to be considered as operating or reportable segments. Therefore, the Company has included their results in an “all other” category as a reconciling item to consolidated amounts.

The Company does not allocate all of its assets, or its depreciation and depletion expense, selling, general and administrative expenses, transactions costs, interest income (expense), and income tax expense or benefit by segment.

The following tables include reconciliations of segment information to consolidated amounts (in thousands):

	For the three months ended March 31,
	2024		2023
Revenues
Mining	$	497,998	$	500,491
All other	5,514		9,183
Total revenues	$	503,512	$	509,674

 

	For the three months ended March 31,
	2024		2023
Capital Expenditures
Mining	$	31,019	$	40,149
All other	68,684		28,030
Total capital expenditures	$	99,703	$	68,179

The Company evaluates the performance of its segment based on Segment Adjusted EBITDA, which is defined as net income adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative, business interruption, idle mine, other income, interest income (expense), net, income tax expense, loss on extinguishment of debt and certain transactions or adjustments that the CODM does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA does not represent and should not be considered as an alternative to cost of sales under GAAP and may not be comparable to other similarly titled measures used by other companies. Below is a reconciliation of Segment Adjusted EBITDA to net income, which is its most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands): 

	For the three months ended March 31,
	2024		2023
Segment Adjusted EBITDA	$	212,411	$	267,861
Other revenues	5,514		9,183
Cost of other revenues	(9,965)		(11,438)
Depreciation and depletion	(40,023)		(37,213)
Selling, general and administrative	(18,658)		(14,516)
Business interruption	(201)		(4,217)
Other income	—		221
Interest income, net	7,033		1,460
Income tax expense	(19,122)		(29,064)
Net income	$	136,989	$	182,277

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure
Net income	$ 136,989	$ 182,277

XML

Insider Trading Arrangements

3 Months Ended

Mar. 31, 2024

shares

Trading Arrangements, by Individual

Non-Rule 10b5-1 Arrangement Adopted

false

Non-Rule 10b5-1 Arrangement Terminated

false

Jack K. Richardson [Member]

Trading Arrangements, by Individual

Material Terms of Trading Arrangement

On February 26, 2024, Jack K. Richardson, Chief Operating Officer of the Company, adopted a Rule 10b5-1 trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a "Rule 10b5-1 Plan"). Mr. Richardson's plan, which provides for the potential sale of up to 117,005 shares of the Company's common stock, terminates upon the earlier of December 31, 2025 or the date all shares subject to the plan have been sold. In addition, on February 27, 2024, Mr. Richardson terminated the previous Rule 10b5-1 Plan entered into on November 7, 2023, which provided for the potential sale of up to 88,000 shares of the Company's common stock.

Name

Jack K. Richardson

Title

Chief Operating Officer

Adoption Date

February 26, 2024

Arrangement Duration

674 days

February 2024 Plan [Member] | Jack K. Richardson [Member]

Trading Arrangements, by Individual

Rule 10b5-1 Arrangement Adopted

true

Aggregate Available

117,005

November 2023 Plan [Member]

Trading Arrangements, by Individual

Rule 10b5-1 Arrangement Terminated

false

November 2023 Plan [Member] | Jack K. Richardson [Member]

Trading Arrangements, by Individual

Rule 10b5-1 Arrangement Adopted

true

Aggregate Available

88,000

XML

Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion, the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading.

Use of Estimates

Use of Estimates

The Company prepares its financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Due to the inherent uncertainty involved in making estimates, actual results could differ from those estimates.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents include short-term deposits and highly liquid investments that have original maturities of three months or less when purchased and are stated at cost, which approximates fair value.

Short-Term Investments

Short-Term Investments

Instruments with maturities greater than three months, but less than twelve months, are included in short-term investments. The Company also purchases fixed income securities and certificates of deposits with varying maturities that are classified as available for sale and are carried at fair value. Securities classified as held to maturity are those securities that management has the intent and ability to hold to maturity.

Revenue Recognition

Revenue Recognition

    Revenue is recognized when performance obligations under the terms of a contract with the Company's customers are satisfied; for all contracts this occurs when control of the promised goods have been transferred to the Company's customers and risk of loss passes such customers. For coal shipments to domestic customers via rail, control is transferred when the railcar is loaded. For coal shipments to international customers via ocean vessel, control is transferred when the vessel is loaded at the Port of Mobile in Alabama. Occasionally, the Company will sell coal stockpiles at the barge loadout or port upon which control, title and risk of loss transfers when stockpiles are segregated. For all steelmaking coal sales under average pricing contracts where pricing is not finalized when revenue is recognized, revenue is recorded based on estimated consideration to be received at the date of the sale. For natural gas sales, control is transferred when the gas has been transferred to the pipeline. Revenue is disaggregated between coal sales within the Company's mining segment and natural gas sales included in all other revenues, as disclosed in Note 12.

The Company's coal and gas sales generally include up to 45-day payment terms following the transfer of control of the goods to the customer. The Company typically does not include extended payment terms in its contracts with customers.

Trade Accounts Receivable and Allowance for Credit Losses

Trade Accounts Receivable and Allowance for Credit Losses

    Trade accounts receivable are stated at cost. Trade accounts receivable represent customer obligations that are derived from revenue recognized from contracts with customers. Credit is extended based on an evaluation of the individual customer's financial condition. The Company maintains trade credit insurance on the majority of its customers and the geographic regions of coal shipments to these customers. In some instances, the Company requires letters of credit, cash collateral or prepayments from its customers on or before shipment to mitigate the risk of loss. These efforts have consistently resulted in the Company recognizing no historical credit losses. The Company also has never had to have a claim against its trade credit insurance policy.

In order to estimate the allowance for credit losses on trade accounts receivable, the Company utilizes an aging approach in which potential impairment is calculated based on how long a receivable has been outstanding (e.g., current, 1-31 days, 31-60 days, etc.). The Company calculates an expected credit loss rate based on the Company’s historical credit loss rate, the risk characteristics of its customers, and the current steelmaking coal and steel market environments. As of March 31, 2024 and December 31, 2023, the estimated allowance for credit losses was immaterial and did not have a material impact on the Company's financial statements.

XML

Inventories, net (Tables)

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Schedule of Inventories, Net

Inventories, net are summarized as follows (in thousands):

	March 31, 2024		December 31, 2023
Coal	$	110,438	$	129,989
Raw materials, parts, supplies and other, net	55,212		53,960
Total inventories, net	$	165,650	$	183,949

XML

Debt (Tables)

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Schedule of Long-Term Debt Instruments

The Company's debt consisted of the following (in thousands):

	March 31, 2024		December 31, 2023		Weighted Average Interest Rate	Final Maturity
Senior Secured Notes	$	156,517	$	156,517	7.875%	December 2028
ABL Borrowings	—		—		Varies(1)	December 2026
Debt discount	(3,351)		(3,494)
Total debt	153,166		153,023
Less: current debt	—		—
Total long-term debt	$	153,166	$	153,023

(1) Borrowings under the ABL Facility bear interest at a rate equal to Secured Overnight Financing Rate ("SOFR") ranging from 1.5% to 2.0%, plus a credit adjustment spread, ranging currently from 0.11448% to 0.42826%, or an alternate base rate plus an applicable margin, which is determined based on the average availability of the commitments under the ABL Facility, ranging from 0.5% to 1.0%.

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Leases (Tables)

3 Months Ended

Mar. 31, 2024

Leases [Abstract]

Schedule of Supplemental Balance Sheet Information

Supplemental balance sheet information related to leases was as follows (in thousands):

	March 31, 2024			December 31, 2023
Finance lease right-of-use assets, net(1)	$	64,406		$	67,014
Finance lease liabilities
Current	11,357			11,463
Noncurrent	7,708			8,756
Total finance lease liabilities	$	19,065		$	20,219
Weighted average remaining lease term - finance leases (in months)	20.0			20.8
Weighted average discount rate - finance leases(2)	7.02		%	7.02		%

(1) Finance lease right-of-use assets are recorded net of accumulated amortization of $42.2 million and $38.5 million and are included in property, plant and equipment, net in the Condensed Balance Sheets as of March 31, 2024 and the Balance Sheets as of December 31, 2023, respectively.

(2) When an implicit discount rate is not readily available in a lease, the Company uses its incremental borrowing rate based on information available at the commencement date when determining the present value of lease payments.

Schedule of Components of Lease Expense

The components of lease expense were as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Operating lease cost(1):	$	12,606	$	6,430
Finance lease cost:
Amortization of leased assets	5,758		5,280
Interest on lease liabilities	351		638
Net lease cost	$	18,715	$	12,348

(1) Includes leases that are for periods of 12 months or less.

Schedule of Maturities of Lease Liabilities

Maturities of lease liabilities for the Company's finance leases as of March 31, 2024 were as follows (in thousands):

	Finance Leases(1)
2024	$	14,208
2025	4,598
2026	1,052
2027	—
Thereafter	—
Total	19,858
Less: amount representing interest	(793)
Present value of lease liabilities	$	19,065

(1) Finance lease payments include $3.0 million of future payments required under signed lease agreements that have not yet commenced.

Schedule of Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information related to the Company's leases was as follows (in thousands):

	For the three months ended March 31,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	351	$	638
Financing cash flows from finance leases	$	4,292	$	7,634
Non-cash right-of-use assets obtained in exchange for lease obligations:
Finance leases	$	3,138	$	2,158

XML

Net Income per Share (Tables)

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

Basic and diluted net income per share was calculated as follows (in thousands, except per share data):

	For the three months ended March 31,
	2024		2023
Numerator:
Net income	$	136,989	$	182,277
Denominator:
Weighted-average shares used to compute net income per share—basic	52,163		51,842
Dilutive restrictive stock awards	54		114
Weighted-average shares used to compute net income per share—diluted	52,217		51,956
Net income per share—basic	$	2.63	$	3.52
Net income per share—diluted	$	2.62	$	3.51

XML

Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Schedule of Dividends on Common Shares

The Company has declared the following dividends on common shares as of the filing date of this Form 10-Q:

Dividend per Share		Dividends Paid		Dividend Type	Declaration Date	Record Date	Payable Date
		(in millions)
$	0.07	$	3.6	Quarterly	February 9, 2023	February 20, 2023	February 27, 2023
$	0.88	$	46.4	Special	February 13, 2023	February 28, 2023	March 7, 2023
$	0.07	$	3.7	Quarterly	April 25, 2023	May 5, 2023	May 12, 2023
$	0.07	$	3.7	Quarterly	July 28, 2023	August 7, 2023	August 14, 2023
$	0.07	$	—	Quarterly	October 24, 2023	November 3, 2023	November 10, 2023
$	0.08	$	4.2	Quarterly	February 9, 2024	February 20, 2024	February 26, 2024
$	0.50	$	26.3	Special	February 9, 2024	March 1, 2024	March 7, 2024
$	0.08	$	4.2	Quarterly	April 25, 2024	May 6, 2024	May 13, 2024

XML

Segment Information (Tables)

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Schedule of Reconciliation of Revenue from Segments to Consolidated

The following tables include reconciliations of segment information to consolidated amounts (in thousands):

	For the three months ended March 31,
	2024		2023
Revenues
Mining	$	497,998	$	500,491
All other	5,514		9,183
Total revenues	$	503,512	$	509,674

Schedule of Reconciliation of Capital Expenditures from Segments to Consolidated

	For the three months ended March 31,
	2024		2023
Capital Expenditures
Mining	$	31,019	$	40,149
All other	68,684		28,030
Total capital expenditures	$	99,703	$	68,179

Schedule of Reconciliation of Net Income (Loss) from Segments to Consolidated

Below is a reconciliation of Segment Adjusted EBITDA to net income, which is its most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands): 

	For the three months ended March 31,
	2024		2023
Segment Adjusted EBITDA	$	212,411	$	267,861
Other revenues	5,514		9,183
Cost of other revenues	(9,965)		(11,438)
Depreciation and depletion	(40,023)		(37,213)
Selling, general and administrative	(18,658)		(14,516)
Business interruption	(201)		(4,217)
Other income	—		221
Interest income, net	7,033		1,460
Income tax expense	(19,122)		(29,064)
Net income	$	136,989	$	182,277

XML

Business and Basis of Presentation (Details) - USD ($) $ in Thousands		3 Months Ended
	Mar. 31, 2023	Mar. 31, 2024	Mar. 31, 2023
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Business interruption		$ 201	$ 4,217
Gas Wells
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Payments to acquire equity method investments	$ 2,400

XML

Summary of Significant Accounting Policies - Short-Term Investments (Narrative) (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Schedule of Held-to-maturity Securities [Line Items]
Short-term investments	$ 9,149	$ 9,030
Cash and Fixed Income Securities
Schedule of Held-to-maturity Securities [Line Items]
Short-term investments	$ 9,100	$ 9,000

XML

Inventories, net (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Coal	$ 110,438	$ 129,989
Raw materials, parts, supplies and other, net	55,212	53,960
Total inventories, net	$ 165,650	$ 183,949

XML

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income tax expense	$ 19,122	$ 29,064

XML

Debt - Schedule of Long-Term Debt Instruments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Debt discount	$ (3,351)	$ (3,494)
Total debt	153,166	153,023
Less: current debt	0	0
Total long-term debt	153,166	153,023
ABL Borrowings
Debt Instrument [Line Items]
Long-term debt, gross	$ 0	0
ABL Borrowings | Minimum | Secured Overnight Financing Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	1.50%
ABL Borrowings | Minimum | Credit Adjustment Spread
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	0.11448%
ABL Borrowings | Minimum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	0.50%
ABL Borrowings | Maximum | Secured Overnight Financing Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	2.00%
ABL Borrowings | Maximum | Credit Adjustment Spread
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	0.42826%
ABL Borrowings | Maximum | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate (as a percent)	1.00%
Senior Secured Notes | Senior Secured Notes
Debt Instrument [Line Items]
Long-term debt, gross	$ 156,517	$ 156,517

XML

Debt - Narrative (Details) - USD ($)	3 Months Ended
	Mar. 31, 2023	Nov. 15, 2026	Mar. 31, 2024	Dec. 31, 2023	Dec. 06, 2021
Senior Secured Notes
Debt Instrument [Line Items]
Extinguishment of debt, amount	$ 8,000,000
Loss on early extinguishment of debt	$ 100,000
Senior Secured Notes | Senior Secured Notes
Debt Instrument [Line Items]
Face amount of debt					$ 350,000,000
Stated interest rate (as a percent)			7.875%
Percentage of initial price					99.343%
Senior Secured Notes | Senior Secured Notes Due 2024, Existing Notes
Debt Instrument [Line Items]
Stated interest rate (as a percent)					8.00%
ABL Borrowings | Citibank
Debt Instrument [Line Items]
Amount of borrowings available			$ 107,400,000	$ 107,400,000
ABL Borrowings | Citibank
Debt Instrument [Line Items]
Aggregate lender commitment					$ 65,000,000
Aggregate principal amount drawn			0
ABL Borrowings | Second Amended And Restated Credit Agreement | Citibank | Forecast
Debt Instrument [Line Items]
Aggregate lender commitment		$ 116,000,000
ABL Borrowings | Letter of Credit | Citibank
Debt Instrument [Line Items]
Letters of credit outstanding			$ 8,700,000	$ 8,700,000

XML

Leases - Narrative (Details)	Mar. 31, 2024
Minimum
Lessor, Lease, Description [Line Items]
Remaining lease terms	1 year
Maximum
Lessor, Lease, Description [Line Items]
Remaining lease terms	5 years

XML

Leases - Schedule of Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Leases [Abstract]
Finance lease right-of-use assets, net	$ 64,406	$ 67,014
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Property, plant and equipment, net	Property, plant and equipment, net
Finance lease liabilities
Current	$ 11,357	$ 11,463
Noncurrent	7,708	8,756
Total finance lease liabilities	$ 19,065	$ 20,219
Weighted average remaining lease term - finance leases (in months)	1 year 8 months 1 day	1 year 8 months 23 days
Weighted average discount rate - finance leases (as a percent)	7.02%	7.02%
Accumulated amortization	$ 42,200	$ 38,500

XML

Leases - Schedule of Components of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Leases [Abstract]
Operating lease cost	$ 12,606	$ 6,430
Finance lease cost:
Amortization of leased assets	5,758	5,280
Interest on lease liabilities	351	638
Net lease cost	$ 18,715	$ 12,348

XML

Leases - Schedule of Maturities of Lease Liabilities (Details) $ in Thousands	Mar. 31, 2024 USD ($)
Leases [Abstract]
2024	$ 14,208
2025	4,598
2026	1,052
2027	0
Thereafter	0
Total	19,858
Less: amount representing interest	(793)
Present value of lease liabilities	19,065
Future payments required under signed lease agreements that have not yet commenced	$ 3,000

XML

Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$ 351	$ 638
Financing cash flows from finance leases	4,292	7,634
Non-cash right-of-use assets obtained in exchange for lease obligations:
Finance leases	$ 3,138	$ 2,158

XML

Net Income per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Numerator:
Net income	$ 136,989	$ 182,277
Denominator:
Weighted-average shares used to compute net income per share-basic (in shares)	52,163	51,842
Dilutive restrictive stock awards (in shares)	54	114
Weighted-average shares used to compute net income per share-diluted (in shares)	52,217	51,956
Net income per share-basic (in dollars per share)	$ 2.63	$ 3.52
Net income per share-diluted (in dollars per share)	$ 2.62	$ 3.51

XML

Commitments and Contingencies (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Settlement proceeds		$ 200,000
Throughput obligation	$ 0		$ 0
Coal royalty expense	$ 42,900,000	$ 33,200,000

XML

Stockholders' Equity - Narrative (Details) - USD ($)	3 Months Ended	6 Months Ended
	Mar. 31, 2024	Jun. 30, 2023	Dec. 31, 2023	Mar. 26, 2019	May 02, 2018
Class of Stock [Line Items]
Common stock authorized (in shares)	140,000,000		140,000,000
Common stock, par value (in dollars per share)	$ 0.01		$ 0.01
Preferred stock authorized (in shares)	10,000,000		10,000,000
Preferred stock, par value (in dollars per share)	$ 0.01		$ 0.01
New Stock Repurchase Program
Class of Stock [Line Items]
Authorized amount of stock to be repurchased, value				$ 70,000,000
Shares repurchased (in shares)	500,000	500,000
Shares repurchased, value	$ 10,600,000	$ 10,600,000
Remaining authorized repurchase amount	$ 59,400,000		$ 59,400,000
The First Stock Repurchase Program
Class of Stock [Line Items]
Authorized amount of stock to be repurchased, value					$ 40,000,000

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Stockholders' Equity - Schedule of Dividends on Common Shares (Details) - USD ($) $ / shares in Units, $ in Thousands																3 Months Ended
	May 06, 2024	Apr. 25, 2024	Mar. 01, 2024	Feb. 20, 2024	Feb. 09, 2024	Nov. 10, 2023	Oct. 24, 2023	Aug. 14, 2023	Jul. 28, 2023	May 12, 2023	Apr. 25, 2023	Mar. 07, 2023	Feb. 27, 2023	Feb. 13, 2023	Feb. 09, 2023	Mar. 31, 2024	Mar. 31, 2023
Class of Stock [Line Items]
Dividends Paid																$ 30,638	$ 50,016
Quarterly Dividend
Class of Stock [Line Items]
Dividend per Share (in dollars per share)					$ 0.08		$ 0.07		$ 0.07		$ 0.07				$ 0.07
Dividends Paid				$ 4,200		$ 0		$ 3,700		$ 3,700			$ 3,600
Quarterly Dividend | Forecast
Class of Stock [Line Items]
Dividends Paid	$ 4,200
Quarterly Dividend | Subsequent Event
Class of Stock [Line Items]
Dividend per Share (in dollars per share)		$ 0.08
Special Dividend
Class of Stock [Line Items]
Dividend per Share (in dollars per share)					$ 0.50									$ 0.88
Dividends Paid			$ 26,300									$ 46,400

XML

Derivative Instruments (Details)	3 Months Ended
	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($) derivative_instrument
Derivative [Line Items]
Gain (loss) on derivatives	$ 0	$ 500,000
Natural gas swap contracts, current asset	0		$ 0
Natural gas swap contracts, current liability	0		$ 0
Natural Gas | Swap | Not Designated as Hedging Instrument
Derivative [Line Items]
Derivative contracts outstanding | derivative_instrument			0
Natural Gas | Commodity Contract | Not Designated as Hedging Instrument
Derivative [Line Items]
Gain (loss) on derivatives	$ 0	(700,000)
Realized gain		$ 200,000

XML

Fair Value of Financial Instruments - Narrative (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Senior Secured Notes Due 2024, Existing Notes | Senior Secured Notes | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of debt instrument	$ 157,700,000	$ 156,000,000
Citibank | ABL Borrowings
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amount of borrowings available	107,400,000	107,400,000
ABL Borrowings | Citibank
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Outstanding debt under ABL Facility	0	0
ABL Borrowings | Citibank | Letter of Credit
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Letters of credit outstanding	$ 8,700,000	$ 8,700,000

XML

Segment Information - Narrative (Details)	3 Months Ended
	Mar. 31, 2024 segment
Segment Reporting [Abstract]
Number of operating segments	2
Number of reportable segments	1

XML

Segment Information - Schedule of Reconciliation of Revenue from Segments to Consolidated (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Segment Reporting Information [Line Items]
Total revenues	$ 503,512	$ 509,674
Segment Reconciling Items
Segment Reporting Information [Line Items]
Total revenues	5,514
Mining | Operating Segments
Segment Reporting Information [Line Items]
Total revenues	$ 497,998

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Segment Information - Schedule of Reconciliation of Capital Expenditures from Segments to Consolidated (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Segment Reporting Information [Line Items]
Capital Expenditures	$ 99,703	$ 68,179
Segment Reconciling Items
Segment Reporting Information [Line Items]
Capital Expenditures	68,684	28,030
Mining | Operating Segments
Segment Reporting Information [Line Items]
Capital Expenditures	$ 31,019	$ 40,149

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Segment Information - Schedule of Reconciliation of Net Income (Loss) from Segments to Consolidated (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenue from External Customer [Line Items]
Segment Adjusted EBITDA	$ 212,411	$ 267,861
Other revenues	503,512	509,674
Cost of other revenues	(9,965)	(11,438)
Depreciation and depletion	(40,023)	(37,213)
Selling, general and administrative	(18,658)	(14,516)
Business interruption	(201)	(4,217)
Other income	0	221
Interest expense	7,033	1,460
Income tax expense	(19,122)	(29,064)
Net income	136,989	182,277
Other revenues
Revenue from External Customer [Line Items]
Other revenues	$ 5,514	$ 9,183