As a reminder, in March Weir International, Inc. issued a revised technical exploration report regarding Ramaco’s rare earth opportunity. In terms of its key findings, both the reported rare earth tonnage volume and concentration estimates essentially doubled since Weir's initial May 2023 Report. Importantly, a number of material lithologies showed maximum ppm concentrations exceeding 9,000 ppm, including from coal. In addition, over 10% of the Brook Mine deposit was estimated to contain gallium and germanium, two high value critical minerals recently banned by China.
Lastly, we recently closed an agreement to both extend and increase the size of our existing Revolver with a banking syndicate led by KeyBank, NA. The new facility increases the Revolver from $125 million to $200 million with an accordion feature to increase the ultimate size by an additional amount of $75 million to $275 million. As we look to further growth in production over the coming years, we now welcome the additional flexibility of a larger facility to meet normal operating requirements. The term of the new facility has also been extended to five years, from an original three years. We view the successful closing of this facility as another testament to our strong credit standing and conservative financial metrics.
In summary, we had a challenging quarter. We will move beyond it. We look forward to improving our operational and financial results throughout the remainder of the year as we execute on both our metallurgical coal production growth strategy, while advancing the commercial development of our Brook Mine REE and critical mineral project.”
Key operational and financial metrics are presented below:
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Key Metrics | | | | | | | | | | |
| 1Q24 | | 4Q23 | Chg. | | 1Q23 | Chg. |
Total Tons Sold ('000) | | 929 | | | 988 | (6)% | | | 757 | 23% |
Revenue ($mm) | $ | 172.7 | | $ | 202.7 | (15)% | | $ | 166.4 | 4% |
Cost of Sales ($mm) | $ | 139.7 | | $ | 139.4 | 0% | | $ | 110.5 | 26% |
Non-GAAP Pricing of Tons Sold ($/Ton) 1 | $ | 155 | | $ | 175 | (11)% | | $ | 188 | (18)% |
Non-GAAP Cash Cost of Sales ($/Ton) 1 | $ | 118 | | $ | 107 | 10% | | $ | 109 | 8% |
Non-GAAP Cash Margins on Tons Sold ($/Ton) | $ | 37 | | $ | 68 | (46)% | | $ | 79 | (53)% |
Net Income ($mm) | $ | 2.0 | | $ | 30.0 | (93)% | | $ | 25.3 | (92)% |
Diluted EPS - Class A Common Stock | $ | (0.00) | | $ | 0.60 | (100)% | | $ | 0.57 | (100)% |
Adjusted EBITDA ($mm) 1 | $ | 24.2 | | $ | 58.5 | (59)% | | $ | 48.3 | (50)% |
Capex ($mm) | $ | 18.7 | | $ | 18.0 | 4% | | $ | 23.5 | (20)% |
Adjusted EBITDA less Capex ($mm) | $ | 5.4 | | $ | 40.5 | (87)% | | $ | 24.7 | (78)% |
(1) See “Reconciliation of Non-GAAP Measures”
Differences may occur due to rounding.
FIRST QUARTER 2024 PERFORMANCE
In the following paragraphs, all references to “quarterly” periods or to “the quarter” refer to the first quarter of 2024, unless specified otherwise.
Year over Year Quarterly Comparison
Overall production in the quarter was 844,000 tons, up 1% from the same period of 2023. The Elk Creek complex produced 467,000 tons, down 24% from 611,000 tons last year. The decline was due to both challenging geology and labor constraints, both of which we believe are largely behind us as of this month. The Berwind, Knox Creek, and Maben complexes increased production to a record 377,000 tons in the quarter, up 69% from 223,000 tons for the same period last year.
Quarterly pricing was $155 per ton, which was 18% lower compared to $188 per ton in the first quarter of 2023. This mirrored the year-over-year decline in U.S. metallurgical coal price indices. Cash mine costs were $118 per ton sold, excluding transportation costs, alternative mineral development costs, and idle mine costs, which was an 8% increase from the same period in 2023. As a result of the above, cash margins were $37 per ton during the quarter, down from $79 per ton in the same period of 2023. This was based on non-GAAP revenue (FOB mine) and non-GAAP cash cost of sales (FOB mine).