SunCoke Energy, Inc. Reports Strong Third Quarter 2021 Results
SunCoke Energy (SXC) reported strong third-quarter results for 2021, with net income of $23.0 million, or $0.27 per share. Year-to-date net income reached $30.7 million, or $0.37 per share. Adjusted EBITDA for Q3 was a record $73.9 million, with a year-to-date total of $212.5 million, positioning the company to exceed 2021 guidance of $255 million to $265 million. Revenues rose to $366.5 million, marking a $64.3 million increase, attributed to higher demand in steel and coal markets. The logistics segment also showed positive growth, reflecting continued improvement in coal markets.
- Net income increased by $25.7 million compared to Q3 2020.
- Adjusted EBITDA for Q3 2021 reached a record $73.9 million, improving by $26.1 million year-over-year.
- Revenues rose by $64.3 million due to higher volumes influenced by strong steel and coal markets.
- Logistics segment revenues increased by $9.0 million, driven by higher throughput volumes and favorable pricing.
- None.
LISLE, Ill., Nov. 1, 2021 /PRNewswire/ --
- Third quarter 2021 net income attributable to SXC was
$23.0 million , or$0.27 per share; Year-to-date net income attributable to SXC was$30.7 million , or$0.37 per share - Adjusted EBITDA(1) for the quarter was
$73.9 million , representing record third quarter performance; Year-to-date Adjusted EBITDA was$212.5 million - Well positioned to modestly exceed the full year 2021 Adjusted EBITDA guidance range of
$255 million to$265 million
SunCoke Energy, Inc. (NYSE: SXC) today reported results for the third quarter 2021, reflecting strong performance in our Domestic Coke and Logistics segments.
"We are very pleased with the continued strong performance across all of our operating segments, which is the key driver of our excellent financial results. The resilient nature of our operations and the commitment of our employees was clearly visible in the rapid return to pre hurricane operating conditions at our CMT facility" said Mike Rippey, President and Chief Executive Officer of SunCoke Energy, Inc. "The progress we have made in the export and foundry markets is very encouraging and CMT continues to operate at a high utilization rate. With the backdrop of strong commodity markets and rising demand for our products and services, we are well positioned to modestly exceed the top end of full year 2021 Adjusted EBITDA guidance range."
THIRD QUARTER CONSOLIDATED RESULTS
Three Months Ended September 30, | |||||||||||
(Dollars in millions) | 2021 | 2020 | Increase | ||||||||
Revenues | $ | 366.5 | $ | 302.2 | $ | 64.3 | |||||
Net (loss) income attributable to SXC | $ | 23.0 | $ | (2.7) | $ | 25.7 | |||||
Adjusted EBITDA(1) | $ | 73.9 | $ | 47.8 | $ | 26.1 | |||||
(1) See definition of Adjusted EBITDA and reconciliation elsewhere in this release. |
Revenues in the third quarter of 2021 increased
Net income attributable to SXC and Adjusted EBITDA increased
THIRD QUARTER SEGMENT RESULTS
Domestic Coke
Domestic Coke consists of cokemaking facilities and heat recovery operations at our Jewell, Indiana Harbor, Haverhill, Granite City and Middletown plants.
Three Months Ended September 30, | |||||||||||
(Dollars in millions, except per ton amounts) | 2021 | 2020 | Increase | ||||||||
Revenues | $ | 340.3 | $ | 287.1 | $ | 53.2 | |||||
Adjusted EBITDA(1) | $ | 65.1 | $ | 48.7 | $ | 16.4 | |||||
Sales volumes (thousands of tons) | 1,056 | 868 | 188 | ||||||||
Adjusted EBITDA per ton(2) | $ | 61.65 | $ | 56.11 | $ | 5.54 | |||||
(1) See definition of Adjusted EBITDA and reconciliation elsewhere in this release. |
(2) Reflects Domestic Coke Adjusted EBITDA divided by Domestic Coke sales volumes. |
Revenues and Adjusted EBITDA increased by
Logistics
Logistics consists of the handling and mixing services of coal and other aggregates at our Convent Marine Terminal ("CMT"), Lake Terminal, Kanawha River Terminals ("KRT") and Dismal River Terminal ("DRT").
Three Months Ended September 30, | |||||||||||
(Dollars in millions, except per ton amounts) | 2021 | 2020 | Increase | ||||||||
Revenues | $ | 17.0 | $ | 8.0 | $ | 9.0 | |||||
Intersegment sales | $ | 6.3 | $ | 5.0 | $ | 1.3 | |||||
Adjusted EBITDA(1) | $ | 11.6 | $ | 4.3 | $ | 7.3 | |||||
Tons handled (thousands of tons) | 4,940 | 3,346 | 1,594 | ||||||||
(1) See definition of Adjusted EBITDA and reconciliation elsewhere in this release. |
Revenues and Adjusted EBITDA increased by
Brazil Coke
Brazil Coke consists of a cokemaking facility in Vitória, Brazil, which we operate for an affiliate of ArcelorMittal.
Revenues and Adjusted EBITDA were
Corporate and Other
Corporate and other expenses, which include activity from our legacy coal mining business, was
2021 REVISED OUTLOOK
Our 2021 revised guidance is as follows:
- Domestic Coke total production is expected to be approximately 4.15 million tons
- Consolidated Adjusted EBITDA is expected to be modestly above the guidance range of
$255 million to$265 million - Capital expenditures are projected to be approximately
$90 million - Cash generated by operations is estimated to be
$209 million to$224 million - Cash taxes are projected to be
$5 million to$10 million
RELATED COMMUNICATIONS
We will host our quarterly earnings call at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) today. The conference call will be webcast live and archived for replay in the Investors section of www.suncoke.com. Investors and analysts may participate in this call by using the following link: https://conferencingportals.com/event/QkyupBiI
Upon registration, each participant will be emailed a confirmation and dial-in details.
SUNCOKE ENERGY, INC.
SunCoke Energy, Inc. (NYSE: SXC) supplies high-quality coke to the integrated steel industry under long-term, take-or-pay contracts that pass through commodity and certain operating costs to customers. We utilize an innovative heat-recovery cokemaking technology that captures excess heat for steam or electrical power generation. Our cokemaking facilities are located in Illinois, Indiana, Ohio, Virginia and Brazil. We have more than 60 years of cokemaking experience serving the integrated steel industry. In addition, we provide export and domestic material handling services to coke, coal, steel, power and other bulk and liquids customers. Our logistics terminals have the collective capacity to mix and transload more than 40 million tons of material each year and are strategically located to reach Gulf Coast, East Coast, Great Lakes and international ports. To learn more about SunCoke Energy, Inc., visit our website at www.suncoke.com.
SunCoke routinely announces material information to investors and the marketplace using press releases, Securities and Exchange Commission filings, public conference calls, webcasts and SunCoke's website at http://www.suncoke.com/English/investors/sxc. The information that SunCoke posts to its website may be deemed to be material. Accordingly, SunCoke encourages investors and others interested in SunCoke to routinely monitor and review the information that SunCoke posts on its website, in addition to following SunCoke's press releases, Securities and Exchange Commission filings and public conference calls and webcasts.
DEFINITIONS
- Adjusted EBITDA represents earnings before interest, taxes, depreciation and amortization ("EBITDA"), adjusted for any impairments, restructuring costs and gains or losses on extinguishment of debt. EBITDA and Adjusted EBITDA do not represent and should not be considered alternatives to net income or operating income under GAAP and may not be comparable to other similarly titled measures in other businesses. Management believes Adjusted EBITDA is an important measure in assessing operating performance. Adjusted EBITDA provides useful information to investors because it highlights trends in our business that may not otherwise be apparent when relying solely on GAAP measures and because it eliminates items that have less bearing on our operating performance. EBITDA and Adjusted EBITDA are not measures calculated in accordance with GAAP, and they should not be considered a substitute for net income or any other measure of financial performance presented in accordance with GAAP. Additionally, other companies may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.
- Adjusted EBITDA attributable to SXC represents Adjusted EBITDA less Adjusted EBITDA attributable to noncontrolling interests.
FORWARD-LOOKING STATEMENTS
This press release and related conference call contain "forward-looking statements" (as defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended). Such forward-looking statements include statements that are not strictly historical facts, and include, among other things, statements regarding: our expectations of financial results, condition and outlook; anticipated effects of the COVID-19 pandemic and responses thereto, including the pandemic's impact on general economic and market conditions, as well as on our business, our customers, our results of operations and financial condition; anticipated actions to be taken by management to sustain SunCoke during the economic uncertainty caused by the pandemic and related business actions; and anticipated actions by governments to contain the spread of COVID-19 or mitigate the severity thereof.
Forward-looking statements often may be identified by the use of such words as "believe," "expect," "plan," "project," "intend," "anticipate," "estimate," "predict," "potential," "continue," "may," "will," "should," or the negative of these terms, or similar expressions. Forward-looking statements are inherently uncertain and involve significant known and unknown risks and uncertainties (many of which are beyond the control of SunCoke) that could cause actual results to differ materially. Such risks and uncertainties include, but are not limited to domestic and international economic, political, business, operational, competitive, regulatory and/or market factors affecting SunCoke, as well as uncertainties related to: pending or future litigation, legislation or regulatory actions; liability for remedial actions or assessments under existing or future environmental regulations; gains and losses related to acquisition, disposition or impairment of assets; recapitalizations; access to, and costs of, capital; the effects of changes in accounting rules applicable to SunCoke; and changes in tax, environmental and other laws and regulations applicable to SunCoke's businesses.
Currently, such risks and uncertainties also include: SunCoke's ability to manage its business during and after the COVID-19 pandemic; the impact of the COVID-19 pandemic on SunCoke's results of operations, revenues, earnings and cash flows; SunCoke's ability to reduce costs and capital spending in response to the COVID-19 pandemic; SunCoke's balance sheet and liquidity throughout and following the COVID-19 pandemic; SunCoke's prospects for financial performance and achievement of strategic objectives following the COVID-19 pandemic; capital allocation strategy following the COVID-19-related outbreak; and the general impact on our industry and on the U.S. and global economy resulting from COVID-19, including actions by domestic and foreign governments and others to contain the spread, or mitigate the severity, thereof.
Forward-looking statements are not guarantees of future performance, but are based upon the current knowledge, beliefs and expectations of SunCoke management, and upon assumptions by SunCoke concerning future conditions, any or all of which ultimately may prove to be inaccurate. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. SunCoke does not intend, and expressly disclaims any obligation, to update or alter its forward-looking statements (or associated cautionary language), whether as a result of new information, future events or otherwise after the date of this press release except as required by applicable law.
In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, SunCoke has included in its filings with the Securities and Exchange Commission cautionary language identifying important factors (but not necessarily all the important factors) that could cause actual results to differ materially from those expressed in any forward-looking statement made by SunCoke. For information concerning these factors, see SunCoke's Securities and Exchange Commission filings such as its annual and quarterly reports and current reports on Form 8-K, copies of which are available free of charge on SunCoke's website at www.suncoke.com. All forward-looking statements included in this press release are expressly qualified in their entirety by such cautionary statements. Unpredictable or unknown factors not discussed in this release also could have material adverse effects on forward- looking statements.
SunCoke Energy, Inc. | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(Dollars and shares in millions, except per share amounts) | ||||||||||||||||
Revenues | ||||||||||||||||
Sales and other operating revenue | $ | 366.5 | $ | 302.2 | $ | 1,090.7 | $ | 1,022.9 | ||||||||
Costs and operating expenses | ||||||||||||||||
Cost of products sold and operating expenses | 277.3 | 238.3 | 829.9 | 805.2 | ||||||||||||
Selling, general and administrative expenses | 15.3 | 18.4 | 48.3 | 51.1 | ||||||||||||
Depreciation and amortization expense | 32.5 | 33.5 | 99.0 | 101.7 | ||||||||||||
Total costs and operating expenses | 325.1 | 290.2 | 977.2 | 958.0 | ||||||||||||
Operating income | 41.4 | 12.0 | 113.5 | 64.9 | ||||||||||||
Interest expense, net | 7.9 | 13.7 | 34.8 | 43.2 | ||||||||||||
(Gain) loss on extinguishment of debt | — | (0.5) | 31.9 | (3.4) | ||||||||||||
Income (loss) before income tax expense | 33.5 | (1.2) | 46.8 | 25.1 | ||||||||||||
Income tax expense | 9.4 | 0.2 | 12.0 | 12.8 | ||||||||||||
Net income (loss) | 24.1 | (1.4) | 34.8 | 12.3 | ||||||||||||
Less: Net income attributable to noncontrolling | 1.1 | 1.3 | 4.1 | 3.6 | ||||||||||||
Net income (loss) attributable to SunCoke | $ | 23.0 | $ | (2.7) | $ | 30.7 | $ | 8.7 | ||||||||
Earnings (loss) attributable to SunCoke Energy, | ||||||||||||||||
Basic | $ | 0.28 | $ | (0.03) | $ | 0.37 | $ | 0.10 | ||||||||
Diluted | $ | 0.27 | $ | (0.03) | $ | 0.37 | $ | 0.10 | ||||||||
Weighted average number of common shares | ||||||||||||||||
Basic | 83.0 | 82.8 | 83.0 | 83.1 | ||||||||||||
Diluted | 83.8 | 82.8 | 83.6 | 83.2 | ||||||||||||
SunCoke Energy, Inc. | ||||||||
September 30, 2021 | December 31, 2020 | |||||||
(Unaudited) | ||||||||
(Dollars in millions, except par value amounts) | ||||||||
Assets | ||||||||
Cash and cash equivalents | $ | 54.6 | $ | 48.4 | ||||
Receivables, net | 60.1 | 46.3 | ||||||
Inventories | 129.3 | 126.6 | ||||||
Income tax receivable | 0.5 | 5.5 | ||||||
Other current assets | 6.1 | 2.9 | ||||||
Total current assets | 250.6 | 229.7 | ||||||
Properties, plants and equipment (net of accumulated depreciation of | 1,288.1 | 1,328.0 | ||||||
Intangible assets, net | 35.7 | 37.2 | ||||||
Deferred charges and other assets | 18.8 | 18.5 | ||||||
Total assets | $ | 1,593.2 | $ | 1,613.4 | ||||
Liabilities and Equity | ||||||||
Accounts payable | $ | 122.1 | $ | 104.1 | ||||
Accrued liabilities | 50.6 | 49.8 | ||||||
Current portion of financing obligation | 3.1 | 3.0 | ||||||
Interest payable | 6.7 | 2.0 | ||||||
Total current liabilities | 182.5 | 158.9 | ||||||
Long-term debt and financing obligation | 597.8 | 673.9 | ||||||
Accrual for black lung benefits | 62.7 | 60.0 | ||||||
Retirement benefit liabilities | 23.2 | 24.7 | ||||||
Deferred income taxes | 165.1 | 159.3 | ||||||
Asset retirement obligations | 12.1 | 11.4 | ||||||
Other deferred credits and liabilities | 26.1 | 24.3 | ||||||
Total liabilities | 1,069.5 | 1,112.5 | ||||||
Equity | ||||||||
Preferred stock, | — | — | ||||||
Common stock, | 1.0 | 1.0 | ||||||
Treasury stock, 15,404,482 shares at both September 30, 2021 and | (184.0) | (184.0) | ||||||
Additional paid-in capital | 719.4 | 715.7 | ||||||
Accumulated other comprehensive loss | (17.6) | (17.1) | ||||||
Retained deficit | (31.1) | (46.6) | ||||||
Total SunCoke Energy, Inc. stockholders' equity | 487.7 | 469.0 | ||||||
Noncontrolling interest | 36.0 | 31.9 | ||||||
Total equity | 523.7 | 500.9 | ||||||
Total liabilities and equity | $ | 1,593.2 | $ | 1,613.4 | ||||
SunCoke Energy, Inc. | ||||||||
Nine Months Ended September 30, | ||||||||
2021 | 2020 | |||||||
(Dollars in millions) | ||||||||
Cash Flows from Operating Activities: | ||||||||
Net income | $ | 34.8 | $ | 12.3 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization expense | 99.0 | 101.7 | ||||||
Deferred income tax expense | 5.8 | 15.4 | ||||||
Payments in excess of expense for postretirement plan benefits | (1.2) | (1.4) | ||||||
Share-based compensation expense | 4.3 | 2.9 | ||||||
Loss (gain) on extinguishment of debt | 31.9 | (3.4) | ||||||
Changes in working capital pertaining to operating activities: | ||||||||
Receivables, net | (13.8) | 12.7 | ||||||
Inventories | (3.4) | 17.3 | ||||||
Accounts payable | 13.3 | (38.8) | ||||||
Accrued liabilities | 0.2 | (3.3) | ||||||
Interest payable | 4.7 | 11.7 | ||||||
Income taxes | 5.0 | (5.2) | ||||||
Other | 3.4 | 1.2 | ||||||
Net cash provided by operating activities | 184.0 | 123.1 | ||||||
Cash Flows from Investing Activities: | ||||||||
Capital expenditures | (52.1) | (53.4) | ||||||
Other investing activities | — | (1.4) | ||||||
Net cash used in investing activities | (52.1) | (54.8) | ||||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from issuance of long-term debt | 500.0 | — | ||||||
Repayment of long-term debt | (609.3) | (15.8) | ||||||
Proceeds from revolving facility | 581.1 | 407.9 | ||||||
Repayment of revolving facility | (567.4) | (446.9) | ||||||
Repayment of financing obligation | (2.2) | (2.1) | ||||||
Debt issuance costs | (12.0) | — | ||||||
Dividends paid | (15.1) | (15.0) | ||||||
Shares repurchased | — | (7.0) | ||||||
Other financing activities | (0.8) | (0.5) | ||||||
Net cash used in financing activities | (125.7) | (79.4) | ||||||
Net increase (decrease) in cash and cash equivalents | 6.2 | (11.1) | ||||||
Cash and cash equivalents at beginning of period | 48.4 | 97.1 | ||||||
Cash and cash equivalents at end of period | $ | 54.6 | $ | 86.0 | ||||
Supplemental Disclosure of Cash Flow Information | ||||||||
Interest paid, net of capitalized interest of | $ | 26.6 | $ | 28.0 | ||||
Income taxes paid, net of refunds of | $ | 1.3 | $ | 2.6 | ||||
SunCoke Energy, Inc. | ||||||||||||||||
The following tables set forth financial and operating data for the three and nine months ended September 30, 2021 and 2020, respectively: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(Dollars in millions, except per ton amounts) | ||||||||||||||||
Sales and other operating revenues: | ||||||||||||||||
Domestic Coke | $ | 340.3 | $ | 287.1 | $ | 1,014.2 | $ | 975.8 | ||||||||
Brazil Coke | 9.2 | 7.1 | 26.7 | 22.8 | ||||||||||||
Logistics | 17.0 | 8.0 | 49.8 | 24.3 | ||||||||||||
Logistics intersegment sales | 6.3 | 5.0 | 20.3 | 16.8 | ||||||||||||
Elimination of intersegment sales | (6.3) | (5.0) | (20.3) | (16.8) | ||||||||||||
Total sales and other operating revenues | $ | 366.5 | $ | 302.2 | $ | 1,090.7 | $ | 1,022.9 | ||||||||
Adjusted EBITDA(1): | ||||||||||||||||
Domestic Coke | $ | 65.1 | $ | 48.7 | $ | 190.0 | $ | 173.7 | ||||||||
Brazil Coke | 4.5 | 3.2 | 13.0 | 10.5 | ||||||||||||
Logistics | 11.6 | 4.3 | 33.9 | 10.6 | ||||||||||||
Corporate and Other(2) | (7.3) | (8.4) | (24.4) | (25.9) | ||||||||||||
Total Adjusted EBITDA | $ | 73.9 | $ | 47.8 | $ | 212.5 | $ | 168.9 | ||||||||
Coke Operating Data: | ||||||||||||||||
Domestic Coke capacity utilization | 100 | % | 82 | % | 101 | % | 92 | % | ||||||||
Domestic Coke production volumes | 1,041 | 877 | 3,131 | 2,933 | ||||||||||||
Domestic Coke sales volumes (thousands | 1,056 | 868 | 3,157 | 2,909 | ||||||||||||
Domestic Coke Adjusted EBITDA per ton(3) | $ | 61.65 | $ | 56.11 | $ | 60.18 | $ | 59.71 | ||||||||
Brazilian Coke production—operated | 426 | 301 | 1,268 | 981 | ||||||||||||
Logistics Operating Data: | ||||||||||||||||
Tons handled (thousands of tons) | 4,940 | 3,346 | 15,344 | 10,413 | ||||||||||||
(1) | See definition of Adjusted EBITDA and reconciliation to GAAP elsewhere in this release. |
(2) | Corporate and Other includes activity from our legacy coal mining business, which contributed Adjusted EBITDA losses of |
(3) | Reflects Domestic Coke Adjusted EBITDA divided by Domestic Coke sales volumes. |
SunCoke Energy, Inc. | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Net income (loss) attributable to SunCoke Energy, Inc. | $ | 23.0 | $ | (2.7) | $ | 30.7 | $ | 8.7 | ||||||||
Add: Net income attributable to noncontrolling | 1.1 | 1.3 | 4.1 | 3.6 | ||||||||||||
Net income (loss) | $ | 24.1 | $ | (1.4) | $ | 34.8 | $ | 12.3 | ||||||||
Add: | ||||||||||||||||
Depreciation and amortization expense | 32.5 | 33.5 | 99.0 | 101.7 | ||||||||||||
Interest expense, net | 7.9 | 13.7 | 34.8 | 43.2 | ||||||||||||
(Gain) loss on extinguishment of debt | — | (0.5) | 31.9 | (3.4) | ||||||||||||
Income tax expense | 9.4 | 0.2 | 12.0 | 12.8 | ||||||||||||
Restructuring costs(1) | — | 2.3 | — | 2.3 | ||||||||||||
Adjusted EBITDA | 73.9 | 47.8 | 212.5 | 168.9 | ||||||||||||
Subtract: Adjusted EBITDA attributable to | 2.1 | 2.3 | 7.0 | 6.6 | ||||||||||||
Adjusted EBITDA attributable to SunCoke | $ | 71.8 | $ | 45.5 | $ | 205.5 | $ | 162.3 | ||||||||
(1) Charges related to a company-wide restructuring and cost-reduction initiative. |
(2) Reflects noncontrolling interest in Indiana Harbor. |
SunCoke Energy, Inc. | ||||||||
2021 | ||||||||
Low | High | |||||||
(Dollars in millions) | ||||||||
Net income | $ | 30 | $ | 40 | ||||
Add: | ||||||||
Depreciation and amortization expense | 137 | 133 | ||||||
Interest expense, net | 47 | 44 | ||||||
Loss on extinguishment of debt | 32 | 32 | ||||||
Income tax expense | 9 | 16 | ||||||
Adjusted EBITDA | $ | 255 | $ | 265 | ||||
Subtract: Adjusted EBITDA attributable to noncontrolling interest(1) | 9 | 9 | ||||||
Adjusted EBITDA attributable to SunCoke Energy, Inc. | $ | 246 | $ | 256 | ||||
(1) Reflects noncontrolling interest in Indiana Harbor. |
View original content to download multimedia:https://www.prnewswire.com/news-releases/suncoke-energy-inc-reports-strong-third-quarter-2021-results-301412510.html
SOURCE SunCoke Energy, Inc.
FAQ
What was SunCoke Energy's (SXC) net income for Q3 2021?
How much did the Adjusted EBITDA increase for SXC in Q3 2021?
What were the revenue figures for SunCoke Energy (SXC) in Q3 2021?
How is SunCoke Energy (SXC) performing compared to its adjusted EBITDA guidance for 2021?
What factors contributed to the increase in SunCoke Energy's (SXC) revenues?
