Warrior Met Coal Inc (HCC) Q3 2023 Earnings: Sales Volumes Rise 51%, Debt Reduced by Nearly 50%
Warrior Met Coal Inc (NYSE:HCC) reported a 51% increase in quarterly sales volumes to 2.3 million short tons
The company reduced its debt leverage by nearly 50% or $146.1 million
Net income for Q3 2023 was $85.4 million, a decrease from $98.4 million in Q3 2022
Total revenues for Q3 2023 were $423.5 million, compared to $390.2 million in Q3 2022
On November 1, 2023, Warrior Met Coal Inc (NYSE:HCC) announced its third-quarter results for 2023. The company reported a net income of $85.4 million, or $1.64 per diluted share, a decrease from the net income of $98.4 million, or $1.90 per diluted share, in the third quarter of 2022. Despite the decrease in net income, the company showed strong performance in other areas.
Financial Highlights
Warrior Met Coal Inc (NYSE:HCC) reported a significant increase in sales volumes, which rose 51% to 2.3 million short tons. The company also managed to reduce its debt leverage by nearly 50% or $146.1 million. Total revenues for the third quarter of 2023 were $423.5 million, compared to $390.2 million in the third quarter of 2022.
Operating Results
The company's sales volume in Q3 2023 was 2.3 million short tons, a 51% increase from 1.5 million short tons in Q3 2022. This increase was driven by improved performance by the company's rail transportation provider and the McDuffie Terminal, which enabled Warrior to export more product and draw down excess inventory. The company produced 2.0 million short tons of steelmaking coal in Q3 2023, a 21% increase from 1.6 million short tons in Q3 2022.
Financial Results
The average net selling price of the company's steelmaking coal decreased 26% from $248.13 per short ton in Q3 2022 to $184.71 per short ton in Q3 2023. Cost of sales for Q3 2023 were $260.4 million, compared to $203.4 million for Q3 2022. The company generated cash flows of $138.6 million from operating activities in Q3 2023, compared to $247.2 million in Q3 2022.
Company Outlook
The company has updated its guidance for the full year 2023. Key factors that may affect outlook include one planned longwall move in Q4, HCC index pricing, exclusion of other non-recurring costs, terms of any new labor contract, and inflationary pressures.
Despite the decrease in net income, Warrior Met Coal Inc (NYSE:HCC) shows strong performance in sales and debt management. The company's ability to increase sales volumes and reduce debt leverage demonstrates its financial strength and resilience in a challenging market environment.
Explore the complete 8-K earnings release (here) from Warrior Met Coal Inc for further details.
This article first appeared on GuruFocus.
