LISLE, Ill., Aug. 3, 2020
/PRNewswire/ -- SunCoke Energy, Inc. (NYSE: SXC) today
reported results for the second quarter 2020 and provided
updates on COVID-19 impact on business and result of customer
negotiations.
"We recognize that COVID-19 has significantly impacted the steel
industry as evident from recent steel capacity utilization rates.
In response to the market challenges presented by COVID-19, we have
taken proactive actions to work with our customers and provide
near-term coke supply relief in exchange for extending existing
contracts," said Mike Rippey,
President and Chief Executive Officer of SunCoke Energy, Inc. "We
expect the impact of these short-term relief measures, net of cost
savings initiatives, will result in a $40 - $50 million
reduction in 2020 Adjusted EBITDA. We are pleased to have
successfully addressed short-term market challenges with our
customers while simultaneously assuring long term stability for our
stakeholders."
Rippey added, "In addition to the significant progress we have
made with our customer contracts, we are also evaluating our cost
structure to ensure that we remain a low cost coke and logistics
service provider. We have taken certain actions, which while
difficult during these unprecedented times, will help better
position SunCoke for the future. We anticipate that these
initiatives will achieve full year savings of approximately
$10 million in 2021. We are also
working on a transformational project to produce and sell foundry
coke beginning in 2021. This alternative product will provide
customer diversification and help address current blast furnace
coke market dynamics."
SECOND QUARTER CONSOLIDATED RESULTS
|
Three Months Ended
June 30,
|
|
(Dollars in
millions)
|
2020
|
|
2019
|
|
Increase
(Decrease)
|
|
Revenues
|
$
|
338.0
|
|
|
$
|
407.5
|
|
|
$
|
(69.5)
|
|
|
Net income
attributable to SXC
|
$
|
6.5
|
|
|
$
|
2.3
|
|
|
$
|
4.2
|
|
|
Adjusted
EBITDA(1)
|
$
|
59.0
|
|
|
$
|
63.1
|
|
|
$
|
(4.1)
|
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
Revenue in the second quarter 2020 decreased $69.5 million compared to the same prior year
period, reflecting the pass through of lower coal prices in our
Domestic Coke segment as well as lower volumes in both our Domestic
Coke and Logistics segments.
Adjusted EBITDA decreased $4.1
million as compared to the same prior year period. Lower
volumes were partly offset by operating and maintenance savings in
our Domestic Coke segment.
Net income attributable to SXC increased $4.2 million from the prior year period. The
decrease in operating results discussed above was more than offset
by lower depreciation expense and the absence of $4.4 million in transaction costs incurred during
the prior year period.
SECOND 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
June 30,
|
|
(Dollars in
millions, except per ton amounts)
|
2020
|
|
2019
|
|
Increase
(Decrease)
|
|
Revenues
|
$
|
323.5
|
|
|
$
|
378.0
|
|
|
$
|
(54.5)
|
|
|
Adjusted
EBITDA(1)
|
$
|
61.6
|
|
|
$
|
56.3
|
|
|
$
|
5.3
|
|
|
Sales volumes
(thousands of tons)
|
977
|
|
|
1,030
|
|
|
(53)
|
|
|
Adjusted EBITDA per
ton(2)
|
$
|
63.05
|
|
|
$
|
54.66
|
|
|
$
|
8.39
|
|
|
|
|
(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 decreased $54.5 million
largely due to the pass through of lower coal costs, which
decreased revenues by $42.8 million.
Higher sales volumes from rebuilt ovens at our Indiana Harbor
facility were more than offset by the impact of volume relief
provided to our customers in 2020.
On a full year basis, we expect the volume relief provided to
our customers to be approximately 550,000 tons and we now expect to
produce approximately 3,750,000 tons of coke in 2020.
Adjusted EBITDA increased $5.3
million as operating and maintenance cost savings across the
domestic coke fleet offset the decrease in volume discussed
above.
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
June 30,
|
|
(Dollars in
millions, except per ton amounts)
|
2020
|
|
2019
|
|
Decrease
|
|
Revenues
|
$
|
7.3
|
|
|
$
|
19.5
|
|
|
$
|
(12.2)
|
|
|
Intersegment
sales
|
$
|
5.2
|
|
|
$
|
6.7
|
|
|
$
|
(1.5)
|
|
|
Adjusted
EBITDA(1)
|
$
|
3.0
|
|
|
$
|
11.8
|
|
|
$
|
(8.8)
|
|
|
Tons handled
(thousands of tons)
|
2,853
|
|
|
5,592
|
|
|
(2,739)
|
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
Revenues and Adjusted EBITDA decreased by $12.2 million and $8.8
million, respectively, driven by lower throughput volumes
and lower price partially offset by lower operating costs. Lower
demand continued to impact coal volumes in the second quarter.
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 $7.2
million and $3.2 million,
respectively, during the second quarter 2020, which was lower than
revenues and Adjusted EBITDA of $10.0
million and $4.3 million,
respectively, during the second quarter 2019, driven by lower sales
volumes.
Corporate and Other
Corporate and other expenses,
which includes activity from our legacy coal mining business, was
$8.8 million during the second
quarter 2020, $0.5 million lower than
$9.3 million during second quarter
2019. Corporate expenses in the current quarter included foundry
related research and development costs of $0.6 million, which was more than offset by
favorable employee related expenses as compared to the same prior
year period.
2020 Revised Outlook
Our 2020 guidance, is as follows:
- Domestic coke production is expected to be approximately 3.75
million tons
- Domestic coke Adjusted EBITDA/ton is expected to be between
$53 to $54/ton
- Consolidated Adjusted EBITDA is expected to be between
$190 to $200
million
- Capital expenditures are projected to be approximately
$80 million which includes
approximately $12 million for foundry
coke
- Free Cash Flow is estimated to be between $36 million and $56
million
- Cash taxes are projected to be between $0 to $4
million
RELATED COMMUNICATIONS
We will host our quarterly earnings call at 10:30 a.m.
Eastern Time (9:30 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:
http://www.directeventreg.com/registration/event/9541916
Upon registration, each participant will be emailed a confirmation,
dial-in details, and a registrant ID.
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 55 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.
DEFINITIONS
- Adjusted EBITDA represents earnings before
interest, taxes, depreciation and amortization ("EBITDA"), adjusted
for any impairments, gain on extinguishment of debt, changes to our
contingent consideration liability related to our acquisition of
CMT, and/or transaction costs incurred as part of the
Simplification Transaction. EBITDA and Adjusted EBITDA do not
represent and should not be considered alternatives to net income
or operating income under accounting principles generally accepted
in the U.S. ("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.
- Free Cash Flow (FCF) represents operating cash
flow adjusted for capital expenditures. Management believes FCF is
an important measure of liquidity. FCF is not a measure calculated
in accordance with GAAP, and they should not be considered a
substitute for operating cash flow or any other measure of
financial performance presented in accordance with GAAP.
- 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 contains
"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.
Consolidated
Statements of Income
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars and shares in millions,
except per share amounts)
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
Sales and other
operating revenue
|
|
$
|
338.0
|
|
|
$
|
407.5
|
|
|
$
|
720.7
|
|
|
$
|
798.8
|
|
|
Costs and
operating expenses
|
|
|
|
|
|
|
|
|
|
Cost of products sold
and operating expenses
|
|
262.5
|
|
|
327.0
|
|
|
566.9
|
|
|
634.4
|
|
|
Selling, general and
administrative expenses
|
|
16.5
|
|
|
21.9
|
|
|
32.7
|
|
|
38.6
|
|
|
Depreciation and
amortization expense
|
|
34.1
|
|
|
37.0
|
|
|
68.2
|
|
|
74.2
|
|
|
Total costs and
operating expenses
|
|
313.1
|
|
|
385.9
|
|
|
667.8
|
|
|
747.2
|
|
|
Operating
income
|
|
24.9
|
|
|
21.6
|
|
|
52.9
|
|
|
51.6
|
|
|
Interest expense,
net
|
|
14.9
|
|
|
15.1
|
|
|
29.5
|
|
|
29.9
|
|
|
Gain on
extinguishment of debt
|
|
—
|
|
|
—
|
|
|
(2.9)
|
|
|
—
|
|
|
Income before income
tax expense
|
|
10.0
|
|
|
6.5
|
|
|
26.3
|
|
|
21.7
|
|
|
Income tax
expense
|
|
2.2
|
|
|
3.2
|
|
|
12.6
|
|
|
6.2
|
|
|
Net income
|
|
7.8
|
|
|
3.3
|
|
|
13.7
|
|
|
15.5
|
|
|
Less: Net income
attributable to noncontrolling interests
|
|
1.3
|
|
|
1.0
|
|
|
2.3
|
|
|
3.4
|
|
|
Net income
attributable to SunCoke Energy, Inc.
|
|
$
|
6.5
|
|
|
$
|
2.3
|
|
|
$
|
11.4
|
|
|
$
|
12.1
|
|
|
Earnings attributable
to SunCoke Energy, Inc. per common share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.08
|
|
|
$
|
0.03
|
|
|
$
|
0.14
|
|
|
$
|
0.19
|
|
|
Diluted
|
|
$
|
0.08
|
|
|
$
|
0.03
|
|
|
$
|
0.14
|
|
|
$
|
0.18
|
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
82.8
|
|
|
65.9
|
|
|
83.2
|
|
|
65.4
|
|
|
Diluted
|
|
82.9
|
|
|
66.1
|
|
|
83.4
|
|
|
65.7
|
|
|
SunCoke Energy,
Inc.
Consolidated
Balance Sheets
|
|
|
|
|
|
|
|
June 30,
2020
|
|
December 31,
2019
|
|
|
(Unaudited)
|
|
|
|
|
(Dollars in
millions, except
par value amounts)
|
|
Assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
81.1
|
|
|
$
|
97.1
|
|
|
Receivables,
net
|
|
49.5
|
|
|
59.5
|
|
|
Inventories
|
|
135.2
|
|
|
147.0
|
|
|
Income tax
receivable
|
|
6.1
|
|
|
2.2
|
|
|
Other current
assets
|
|
5.2
|
|
|
2.5
|
|
|
Total current
assets
|
|
277.1
|
|
|
308.3
|
|
|
Properties, plants
and equipment (net of accumulated depreciation of $969.5
million and $903.7 million at June 30, 2020 and
December 31, 2019,
respectively)
|
|
1,347.6
|
|
|
1,390.2
|
|
|
Goodwill and other
intangible assets, net
|
|
36.8
|
|
|
38.1
|
|
|
Deferred charges and
other assets
|
|
16.9
|
|
|
17.2
|
|
|
Total
assets
|
|
$
|
1,678.4
|
|
|
$
|
1,753.8
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
Accounts
payable
|
|
$
|
72.9
|
|
|
$
|
142.4
|
|
|
Accrued
liabilities
|
|
41.7
|
|
|
47.3
|
|
|
Current portion of
financing obligation
|
|
3.0
|
|
|
2.9
|
|
|
Interest
payable
|
|
2.1
|
|
|
2.2
|
|
|
Total current
liabilities
|
|
119.7
|
|
|
194.8
|
|
|
Long-term debt and
financing obligation
|
|
768.1
|
|
|
780.0
|
|
|
Accrual for black
lung benefits
|
|
51.3
|
|
|
50.5
|
|
|
Retirement benefit
liabilities
|
|
23.5
|
|
|
24.5
|
|
|
Deferred income
taxes
|
|
162.6
|
|
|
147.6
|
|
|
Asset retirement
obligations
|
|
14.9
|
|
|
14.4
|
|
|
Other deferred
credits and liabilities
|
|
22.8
|
|
|
23.6
|
|
|
Total
liabilities
|
|
1,162.9
|
|
|
1,235.4
|
|
|
Equity
|
|
|
|
|
|
Preferred stock,
$0.01 par value. Authorized 50,000,000 shares; no issued
shares at both June 30, 2020 and December 31,
2019
|
|
—
|
|
|
—
|
|
|
Common stock, $0.01
par value. Authorized 300,000,000 shares; issued
98,172,557 and 98,047,389 shares at June 30, 2020 and
December 31,
2019, respectively
|
|
1.0
|
|
|
1.0
|
|
|
Treasury stock,
15,404,482 and 13,783,182 shares at June 30, 2020 and
December 31, 2019, respectively
|
|
(184.0)
|
|
|
(177.0)
|
|
|
Additional paid-in
capital
|
|
714.1
|
|
|
712.1
|
|
|
Accumulated other
comprehensive loss
|
|
(15.9)
|
|
|
(14.4)
|
|
|
Retained
deficit
|
|
(28.8)
|
|
|
(30.1)
|
|
|
Total SunCoke Energy,
Inc. stockholders' equity
|
|
486.4
|
|
|
491.6
|
|
|
Noncontrolling
interest
|
|
29.1
|
|
|
26.8
|
|
|
Total
equity
|
|
515.5
|
|
|
518.4
|
|
|
Total liabilities and
equity
|
|
$
|
1,678.4
|
|
|
$
|
1,753.8
|
|
|
SunCoke Energy,
Inc.
Consolidated
Statements of Cash Flows
(Unaudited)
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
(Dollars in
millions)
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
Net income
|
|
$
|
13.7
|
|
|
$
|
15.5
|
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
68.2
|
|
|
74.2
|
|
|
Deferred income tax
expense
|
|
15.0
|
|
|
1.8
|
|
|
Payments in excess of
expense for postretirement plan benefits
|
|
(1.0)
|
|
|
(1.1)
|
|
|
Share-based
compensation expense
|
|
2.3
|
|
|
2.1
|
|
|
Gain on extinguishment
of debt
|
|
(2.9)
|
|
|
—
|
|
|
Changes in working
capital pertaining to operating activities:
|
|
|
|
|
|
Receivables
|
|
10.0
|
|
|
(23.5)
|
|
|
Inventories
|
|
11.8
|
|
|
(65.3)
|
|
|
Accounts
payable
|
|
(56.9)
|
|
|
23.0
|
|
|
Accrued
liabilities
|
|
(5.5)
|
|
|
10.7
|
|
|
Interest
payable
|
|
(0.1)
|
|
|
0.3
|
|
|
Income
taxes
|
|
(3.9)
|
|
|
(2.5)
|
|
|
Other
|
|
(2.1)
|
|
|
0.4
|
|
|
Net cash provided by
operating activities
|
|
48.6
|
|
|
35.6
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
Capital
expenditures
|
|
(36.9)
|
|
|
(53.1)
|
|
|
Other investing
activities
|
|
—
|
|
|
0.2
|
|
|
Net cash used in
investing activities
|
|
(36.9)
|
|
|
(52.9)
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
Repayment of
long-term debt
|
|
(8.9)
|
|
|
(0.6)
|
|
|
Proceeds from
revolving credit facility
|
|
247.2
|
|
|
175.6
|
|
|
Repayment of
revolving credit facility
|
|
(247.2)
|
|
|
(180.6)
|
|
|
Repayment of
financing obligation
|
|
(1.4)
|
|
|
(1.4)
|
|
|
Shares
repurchased
|
|
(7.0)
|
|
|
—
|
|
|
Dividends
paid
|
|
(10.0)
|
|
|
—
|
|
|
Cash distribution to
noncontrolling interests
|
|
—
|
|
|
(14.2)
|
|
|
Other financing
activities
|
|
(0.4)
|
|
|
(5.0)
|
|
|
Net cash used in
financing activities
|
|
(27.7)
|
|
|
(26.2)
|
|
|
Net decrease in cash
and cash equivalents
|
|
(16.0)
|
|
|
(43.5)
|
|
|
Cash and cash
equivalents at beginning of period
|
|
97.1
|
|
|
145.7
|
|
|
Cash and cash
equivalents at end of period
|
|
$
|
81.1
|
|
|
$
|
102.2
|
|
|
Supplemental
Disclosure of Cash Flow Information
|
|
|
|
|
|
Interest paid, net of
capitalized interest of zero and $2.3 million,
respectively
|
|
$
|
27.3
|
|
|
$
|
28.0
|
|
|
Income taxes paid,
net of refunds of $0.3 million and zero, respectively
|
|
$
|
1.4
|
|
|
$
|
6.5
|
|
SunCoke Energy, Inc.
Segment
Financial and Operating Data
The following tables set forth financial and operating data for
the three and six months ended June 30,
2020 and 2019, respectively:
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions, except per ton amounts)
|
|
Sales and other
operating revenues:
|
|
|
|
|
|
|
|
|
|
Domestic
Coke
|
|
$
|
323.5
|
|
|
$
|
378.0
|
|
|
$
|
688.7
|
|
|
$
|
737.3
|
|
|
Brazil Coke
|
|
7.2
|
|
|
10.0
|
|
|
15.7
|
|
|
19.7
|
|
|
Logistics
|
|
7.3
|
|
|
19.5
|
|
|
16.3
|
|
|
41.8
|
|
|
Logistics intersegment
sales
|
|
5.2
|
|
|
6.7
|
|
|
11.8
|
|
|
13.2
|
|
|
Elimination of
intersegment sales
|
|
(5.2)
|
|
|
(6.7)
|
|
|
(11.8)
|
|
|
(13.2)
|
|
|
Total sales and other
operating revenues
|
|
$
|
338.0
|
|
|
$
|
407.5
|
|
|
$
|
720.7
|
|
|
$
|
798.8
|
|
|
Adjusted
EBITDA(1):
|
|
|
|
|
|
|
|
|
|
Domestic
Coke
|
|
$
|
61.6
|
|
|
$
|
56.3
|
|
|
$
|
125.0
|
|
|
$
|
114.8
|
|
|
Brazil Coke
|
|
3.2
|
|
|
4.3
|
|
|
7.3
|
|
|
8.8
|
|
|
Logistics
|
|
3.0
|
|
|
11.8
|
|
|
6.3
|
|
|
24.5
|
|
|
Corporate and
Other(2)
|
|
(8.8)
|
|
|
(9.3)
|
|
|
(17.5)
|
|
|
(17.7)
|
|
|
Total Adjusted
EBITDA
|
|
$
|
59.0
|
|
|
$
|
63.1
|
|
|
$
|
121.1
|
|
|
$
|
130.4
|
|
|
Coke Operating
Data:
|
|
|
|
|
|
|
|
|
|
Domestic Coke
capacity utilization
|
|
94
|
%
|
|
97
|
%
|
|
98
|
%
|
|
97
|
%
|
|
Domestic Coke
production volumes (thousands of tons)
|
|
987
|
|
|
1,030
|
|
|
2,056
|
|
|
2,036
|
|
|
Domestic Coke sales
volumes (thousands of tons)
|
|
977
|
|
|
1,030
|
|
|
2,041
|
|
|
2,034
|
|
|
Domestic Coke Adjusted
EBITDA per ton(3)
|
|
$
|
63.05
|
|
|
$
|
54.66
|
|
|
$
|
61.24
|
|
|
$
|
56.44
|
|
|
Brazilian Coke
production—operated facility (thousands of tons)
|
|
270
|
|
|
424
|
|
|
680
|
|
|
843
|
|
|
Logistics
Operating Data:
|
|
|
|
|
|
|
|
|
|
Tons handled
(thousands of tons)
|
|
2,853
|
|
|
5,592
|
|
|
7,067
|
|
|
11,376
|
|
|
|
|
(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 $2.4 million and $4.5 million
during the three and six months ended June 30, 2020,
respectively, and $2.0 million and $3.8 million for the three and
six months ended June 30, 2019, respectively. Additionally,
Corporate and Other includes foundry related research and
development costs of $0.6 million and $1.4 million during the three
and six months ended June 30, 2020, respectively.
|
|
(3)
|
Reflects Domestic
Coke Adjusted EBITDA divided by Domestic Coke sales
volumes.
|
|
SunCoke Energy,
Inc.
Reconciliation of
Non-GAAP Information
Net Income to
Adjusted EBITDA
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
(Dollars in
millions)
|
|
Net income
attributable to SunCoke Energy, Inc.
|
|
$
|
6.5
|
|
|
$
|
2.3
|
|
|
$
|
11.4
|
|
|
$
|
12.1
|
|
|
Add: Net income
attributable to noncontrolling interests
|
|
1.3
|
|
|
1.0
|
|
|
2.3
|
|
|
3.4
|
|
|
Net
income
|
|
$
|
7.8
|
|
|
$
|
3.3
|
|
|
$
|
13.7
|
|
|
$
|
15.5
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
34.1
|
|
|
37.0
|
|
|
68.2
|
|
|
74.2
|
|
|
Interest expense,
net
|
|
14.9
|
|
|
15.1
|
|
|
29.5
|
|
|
29.9
|
|
|
Gain on extinguishment
of debt
|
|
—
|
|
|
—
|
|
|
(2.9)
|
|
|
—
|
|
|
Income tax
expense
|
|
2.2
|
|
|
3.2
|
|
|
12.6
|
|
|
6.2
|
|
|
Contingent
consideration adjustments(1)
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
(0.3)
|
|
|
Simplification
Transaction costs(2)
|
|
—
|
|
|
4.4
|
|
|
—
|
|
|
4.9
|
|
|
Adjusted
EBITDA
|
|
59.0
|
|
|
63.1
|
|
|
121.1
|
|
|
130.4
|
|
|
Subtract: Adjusted
EBITDA attributable to noncontrolling
interest(3)
|
|
2.3
|
|
|
18.6
|
|
|
4.3
|
|
|
37.5
|
|
|
Adjusted EBITDA
attributable to SunCoke Energy, Inc.
|
|
$
|
56.7
|
|
|
$
|
44.5
|
|
|
$
|
116.8
|
|
|
$
|
92.9
|
|
|
|
|
(1)
|
In connection with
the CMT acquisition, the Company entered into a contingent
consideration arrangement that required the Company to make future
payments to the seller based on future volume over a specified
threshold, price and contract renewals. Contingent
consideration adjustments in the first half of 2019 were primarily
the result of modifications to the volume forecast. This liability
was written to zero during the third quarter of 2019, and the
related contract was terminated in 2020.
|
|
(2)
|
Costs expensed by the
Partnership associated with SunCoke's acquisition of all
outstanding Partnership common units not already owned by SunCoke
on June 28, 2019 ("Simplification Transaction").
|
|
(3)
|
Reflects
noncontrolling interest in Indiana Harbor and the portion of the
Partnership owned by public unitholders prior to the Simplification
Transaction.
|
|
SunCoke Energy,
Inc.
Reconciliation of
Non-GAAP Information
Estimated 2020 Net
Income
to Estimated
Consolidated Adjusted EBITDA
|
|
|
|
|
|
2020
|
|
|
Low
|
|
High
|
|
|
(Dollars in
millions)
|
|
Net
income
|
|
$
|
0
|
|
|
$
|
10
|
|
|
Add:
|
|
|
|
|
|
Depreciation and
amortization expense
|
|
132
|
|
|
128
|
|
|
Interest expense,
net
|
|
57
|
|
|
57
|
|
|
Gain on extinguishment
of debt
|
|
(3)
|
|
|
(3)
|
|
|
Income tax
expense
|
|
2
|
|
|
5
|
|
|
Restructuring
charges(1)
|
|
2
|
|
|
3
|
|
|
Adjusted
EBITDA
|
|
$
|
190
|
|
|
$
|
200
|
|
|
Subtract:
|
|
|
|
|
|
Adjusted EBITDA
attributable to noncontrolling interest(2)
|
|
7
|
|
|
7
|
|
|
Adjusted EBITDA
attributable to SunCoke Energy, Inc.
|
|
$
|
183
|
|
|
$
|
193
|
|
|
|
|
(1)
|
Charges related to a
company-wide restructuring and cost-reduction
initiative.
|
|
(2)
|
Reflects
noncontrolling interest in Indiana Harbor.
|
|
SunCoke Energy,
Inc.
Reconciliation of
Non-GAAP Information
Estimated 2020
Operating Cash Flow
to Estimated 2020
Free Cash Flow
|
|
|
|
|
|
2020
|
|
|
Low
|
|
High
|
|
|
(Dollars in
millions)
|
|
Operating Cash
Flow
|
|
$
|
116
|
|
|
$
|
136
|
|
|
Capital
Expenditures
|
|
$
|
(80)
|
|
|
$
|
(80)
|
|
|
Free Cash Flow
(FCF)
|
|
$
|
36
|
|
|
$
|
56
|
|
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SOURCE SunCoke Energy, Inc.