LISLE, Ill., Nov. 5, 2019 /PRNewswire/ -- SunCoke Energy, Inc.
(NYSE: SXC) today reported results for the third quarter 2019,
reflecting the continued strong performance of the Domestic Coke
segment and customer challenges facing the Logistics segment.
"In the third quarter, cokemaking operations performed at a high
level and delivered excellent results, partially driven by the
success of our oven rebuild program at Indiana Harbor," said
Mike Rippey, President and Chief
Executive Officer of SunCoke Energy, Inc. "In our Coal Logistics
segment, we experienced a meaningful shift in the operating
environment as one of the two coal export customer filed for
bankruptcy and the other continues to explore potential
restructuring alternatives. This development led us to lower our
guidance for the full year and record a non-cash impairment charge
in the current quarter."
Rippey continued, "Going forward, while we navigate through
these difficult market conditions, we remain committed to our
logistics business and are continuing to optimize asset performance
across our businesses to generate significant value for SunCoke
stakeholders in the long term. Despite the challenges in our
logistics business, we continue to deliver strong cash flows and
are committed to prioritizing capital allocation, as demonstrated
by the 2.1 million shares repurchased during the quarter and the
new $100 million share repurchase
authorization approved by our Board."
THIRD QUARTER CONSOLIDATED RESULTS
|
Three Months Ended
September 30,
|
(Dollars in
millions)
|
2019
|
|
2018
|
|
Increase
|
Revenues
|
$
|
404.3
|
|
|
$
|
364.5
|
|
|
$
|
39.8
|
|
Adjusted
EBITDA(1)
|
$
|
66.7
|
|
|
$
|
66.0
|
|
|
$
|
0.7
|
|
Net (loss) income
attributable to SXC
|
$
|
(163.0)
|
|
|
$
|
11.5
|
|
|
$
|
(174.5)
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
Revenues in the third quarter 2019 increased $39.8 million compared to the prior year period,
primarily reflecting the pass-through of higher coal prices,
partially offset by lower volumes in the Logistics segment.
Adjusted EBITDA in the third quarter 2019 was $66.7 million, a $0.7
million increase from the prior year period. Improved
performance in the Domestic Coke segment and lower Corporate costs
were partially offset by lower volumes in the Logistics
segment.
Net loss attributable to SXC was $163.0
million, or $1.81 per share,
for the third quarter 2019 and included non-cash impairment
related charges of Logistics assets of $247.4 million, a related tax benefit of
$68.7 million and a $3.9 million adjustment to our contingent
consideration liability at CMT, which was reduced to zero during
the quarter. The collective impact of these impairment
related charges on net loss attributable to SXC was $174.8 million, or $1.94 per share.
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)
|
2019
|
|
2018
|
|
Increase
|
Revenues
|
$
|
378.5
|
|
|
$
|
326.8
|
|
|
$
|
51.7
|
|
Adjusted
EBITDA(1)
|
$
|
59.8
|
|
|
$
|
49.1
|
|
|
$
|
10.7
|
|
Sales volumes
(thousands of tons)
|
1,057
|
|
|
1,012
|
|
|
45.0
|
|
Adjusted EBITDA per
ton(2)
|
$
|
56.58
|
|
|
$
|
48.52
|
|
|
$
|
8.06
|
|
|
|
(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 increased $51.7 million
primarily due to the pass-through of higher coal prices. Revenues
also benefited from higher volumes at Indiana Harbor (performance
of rebuilt ovens) and Granite City
(absence of major outage).
Adjusted EBITDA increased $10.7
million due to an increase in sales volumes and energy
production as well as lower outage costs.
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)
|
2019
|
|
2018
|
|
Increase
(Decrease)
|
Revenues
|
$
|
16.2
|
|
|
$
|
28.0
|
|
|
$
|
(11.8)
|
|
Intersegment
sales
|
$
|
6.1
|
|
|
$
|
5.7
|
|
|
$
|
0.4
|
|
Adjusted
EBITDA(1)
|
$
|
9.6
|
|
|
$
|
21.0
|
|
|
$
|
(11.4)
|
|
Tons handled
(thousands of tons)(2)
|
4,706
|
|
|
6,943
|
|
|
(2,237)
|
|
CMT take-or-pay
shortfall tons (thousands of tons)(3)
|
1,717
|
|
|
42
|
|
|
1,675
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation elsewhere in this
release.
|
(2)
|
Reflects inbound tons
handled during the period.
|
(3)
|
Reflects tons billed
under take-or-pay contracts where services have not yet been
performed. The Company has established a reserve against the
shortfall tons billed during the three and nine months ended
September 30, 2019 as collection is not probable. As the
obligations related to these billings had not been satisfied, the
related deferred revenue was also reduced by an equal amount,
resulting in no impact to net income (loss) for the three and nine
months ended September 30, 2019.
|
Revenues and Adjusted EBITDA decreased by $11.8 million and $11.4
million, respectively, driven by lower throughput volumes at
the CMT facility. Depressed export pricing and lower demand
continued to impact export volumes in the third 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 $9.6
million and $3.9 million,
respectively, during the third quarter 2019, which was slightly
lower than revenues and Adjusted EBITDA of $9.7 million and $4.5
million, respectively, during the third quarter 2018, driven
by lower sales volumes.
Corporate and Other
Corporate and other Adjusted
EBITDA loss, which include costs related to our legacy coal mining
business, was $6.6 million during the
third quarter 2019, an improvement of $2.0
million compared to third quarter 2018, reflecting lower
legal costs and favorable deferred compensation expense.
2019 OUTLOOK
We are updating our 2019 guidance to reflect financial impact at
logistics:
- Domestic coke production is expected to be approximately 4.1
million tons
- Domestic coke Adjusted EBITDA/ton is expected to be at the
higher end of $53 to $55/ton
- Consolidated Adjusted EBITDA is expected to be between
$240 to $250
million
- Adjusted EBITDA attributable to SXC is expected to be between
$200 to $206
million
- Capital expenditures are projected to be between $110 to $120
million, including $40 million
to $48 million related to our Indiana
Harbor oven rebuild project and approximately $6 million related to completing our Granite City gas sharing project
- Cash generated by operations is estimated to be between
$150 million and $160 million
- Cash taxes are projected to be between $4 to $8
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
may participate in this call by dialing 1-833-236-5757 in the U.S.
or 1-647-689-4185 if outside the U.S., confirmation code
3267039.
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) loss on extinguishment of debt, changes to our
contingent consideration liability related to our acquisition of
CMT, loss on the disposal of our interest in VISA SunCoke Limited,
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.
- Adjusted EBITDA attributable to SXC represents Adjusted
EBITDA less Adjusted EBITDA attributable to noncontrolling
interests.
- Adjusted net income attributable to SXC represents net
income (loss) attributable to SXC adjusted for impairments, changes
to our contingent consideration liability as a result of
impairments and related tax impacts. Adjusted earnings per
share is Adjusted net income attributable to SXC divided by the
weighted average number of diluted common shares outstanding.
Management believes Adjusted net income attributable to SXC and
Adjusted earnings per share provide useful information to investors
because it eliminates non-cash impairment related charges that are
not representative of our ongoing business. These measures are not
calculated in accordance with GAAP, and should not be consider a
substitute for net income or any other measure of financial
performance presented in accordance with GAAP.
FORWARD-LOOKING STATEMENTS
Some of the statements included in this press release constitute
"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). Forward-looking
statements include all statements that are not historical facts and
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 SXC) 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 SXC, 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 SXC; and changes in tax, environmental and other laws
and regulations applicable to SXC's businesses.
Forward-looking statements are not guarantees of future
performance, but are based upon the current knowledge, beliefs and
expectations of SXC management, and upon assumptions by SXC
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. SXC 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, SXC 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 SXC. For information concerning these factors, see
SXC'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 SXC'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 Operations
(Unaudited)
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars and shares in millions,
except per share amounts)
|
Revenues
|
|
|
|
|
|
|
|
|
Sales and other
operating revenue
|
|
$
|
404.3
|
|
|
$
|
364.5
|
|
|
$
|
1,203.1
|
|
|
$
|
1,082.0
|
|
Costs and
operating expenses
|
|
|
|
|
|
|
|
|
Cost of products sold
and operating expenses
|
|
319.4
|
|
|
283.3
|
|
|
953.8
|
|
|
836.6
|
|
Selling, general and
administrative expenses
|
|
14.3
|
|
|
15.7
|
|
|
52.9
|
|
|
49.2
|
|
Depreciation and
amortization expense
|
|
35.6
|
|
|
35.4
|
|
|
109.8
|
|
|
100.3
|
|
Long-lived asset and
goodwill impairment
|
|
247.4
|
|
|
—
|
|
|
247.4
|
|
|
—
|
|
Total costs and
operating expenses
|
|
616.7
|
|
|
334.4
|
|
|
1,363.9
|
|
|
986.1
|
|
Operating (loss)
income
|
|
(212.4)
|
|
|
30.1
|
|
|
(160.8)
|
|
|
95.9
|
|
Interest expense,
net
|
|
15.7
|
|
|
15.4
|
|
|
45.6
|
|
|
46.9
|
|
(Gain) loss on
extinguishment of debt, net
|
|
(1.5)
|
|
|
—
|
|
|
(1.5)
|
|
|
0.3
|
|
(Loss) income before
income tax (benefit) expense
|
|
(226.6)
|
|
|
14.7
|
|
|
(204.9)
|
|
|
48.7
|
|
Income tax (benefit)
expense
|
|
(63.5)
|
|
|
(2.4)
|
|
|
(57.3)
|
|
|
1.8
|
|
Loss from equity
method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.4
|
|
Net (loss)
income
|
|
(163.1)
|
|
|
17.1
|
|
|
(147.6)
|
|
|
41.5
|
|
Less: Net (loss)
income attributable to noncontrolling interests
|
|
(0.1)
|
|
|
5.6
|
|
|
3.3
|
|
|
17.1
|
|
Net (loss) income
attributable to SunCoke Energy, Inc.
|
|
$
|
(163.0)
|
|
|
$
|
11.5
|
|
|
$
|
(150.9)
|
|
|
$
|
24.4
|
|
(Loss) earnings
attributable to SunCoke Energy, Inc. per common share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(1.81)
|
|
|
$
|
0.18
|
|
|
$
|
(2.05)
|
|
|
$
|
0.38
|
|
Diluted
|
|
$
|
(1.81)
|
|
|
$
|
0.18
|
|
|
$
|
(2.05)
|
|
|
$
|
0.37
|
|
Weighted average
number of common
shares
outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
89.9
|
|
|
64.7
|
|
|
73.7
|
|
|
64.7
|
|
Diluted
|
|
89.9
|
|
|
65.5
|
|
|
73.7
|
|
|
65.5
|
|
SunCoke Energy,
Inc.
Consolidated
Balance Sheets
|
|
|
|
September 30,
2019
|
|
December 31,
2018
|
|
|
(Unaudited)
|
|
|
|
|
(Dollars in
millions, except
par value amounts)
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
93.7
|
|
|
$
|
145.7
|
|
Receivables,
net
|
|
62.7
|
|
|
75.4
|
|
Inventories
|
|
157.0
|
|
|
110.4
|
|
Income tax
receivable
|
|
3.1
|
|
|
0.7
|
|
Other current
assets
|
|
4.2
|
|
|
2.8
|
|
Total current
assets
|
|
320.7
|
|
|
335.0
|
|
Properties, plants
and equipment (net of accumulated depreciation of $907.4 million
and $855.8 million at September 30, 2019 and December 31, 2018,
respectively)
|
|
1,389.5
|
|
|
1,471.1
|
|
Goodwill
|
|
3.4
|
|
|
76.9
|
|
Other intangible
assets, net
|
|
35.4
|
|
|
156.8
|
|
Deferred charges and
other assets
|
|
17.2
|
|
|
5.5
|
|
Total
assets
|
|
$
|
1,771.2
|
|
|
$
|
2,045.3
|
|
Liabilities and
Equity
|
|
|
|
|
Accounts
payable
|
|
$
|
119.8
|
|
|
$
|
115.0
|
|
Accrued
liabilities
|
|
46.1
|
|
|
45.6
|
|
Deferred
revenue
|
|
2.1
|
|
|
3.0
|
|
Current portion of
long-term debt and financing obligation
|
|
2.9
|
|
|
3.9
|
|
Interest
payable
|
|
14.4
|
|
|
3.6
|
|
Total current
liabilities
|
|
185.3
|
|
|
171.1
|
|
Long-term debt and
financing obligation
|
|
780.0
|
|
|
834.5
|
|
Accrual for black
lung benefits
|
|
46.9
|
|
|
44.9
|
|
Retirement benefit
liabilities
|
|
23.7
|
|
|
25.2
|
|
Deferred income
taxes
|
|
146.9
|
|
|
254.7
|
|
Asset retirement
obligations
|
|
13.5
|
|
|
14.6
|
|
Other deferred
credits and liabilities
|
|
23.1
|
|
|
17.6
|
|
Total
liabilities
|
|
1,219.4
|
|
|
1,362.6
|
|
Equity
|
|
|
|
|
Preferred stock,
$0.01 par value. Authorized 50,000,000 shares; no issued shares at
both September 30, 2019 and December 31, 2018
|
|
—
|
|
|
—
|
|
Common stock, $0.01
par value. Authorized 300,000,000 shares; issued 98,040,372 and
72,233,750 shares at September 30, 2019 and December 31, 2018,
respectively
|
|
1.0
|
|
|
0.7
|
|
Treasury stock,
9,544,132 and 7,477,657 shares at September 30, 2019 and
December 31, 2018, respectively
|
|
(153.9)
|
|
|
(140.7)
|
|
Additional paid-in
capital
|
|
710.9
|
|
|
488.8
|
|
Accumulated other
comprehensive loss
|
|
(13.9)
|
|
|
(13.1)
|
|
Retained (deficit)
earnings
|
|
(23.5)
|
|
|
127.4
|
|
Total SunCoke Energy,
Inc. stockholders' equity
|
|
520.6
|
|
|
463.1
|
|
Noncontrolling
interests
|
|
26.2
|
|
|
219.6
|
|
Total
equity
|
|
550.2
|
|
|
682.7
|
|
Total liabilities and
equity
|
|
$
|
1,769.6
|
|
|
$
|
2,045.3
|
|
SunCoke Energy,
Inc.
Consolidated
Statements of Cash Flows
(Unaudited)
|
|
|
|
Nine Months Ended
September 30,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
(Dollars in
millions)
|
Cash Flows from
Operating Activities:
|
|
|
|
|
Net (loss)
income
|
|
$
|
(147.6)
|
|
|
$
|
41.5
|
|
Adjustments to
reconcile net (loss) income to net cash provided by operating
activities:
|
|
|
|
|
Long-lived asset and
goodwill impairment
|
|
247.4
|
|
|
—
|
|
Depreciation and
amortization expense
|
|
109.8
|
|
|
100.3
|
|
Deferred income tax
benefit
|
|
(64.2)
|
|
|
(4.0)
|
|
Payments in excess of
expense for postretirement plan benefits
|
|
(1.5)
|
|
|
(1.8)
|
|
Share-based
compensation expense
|
|
3.3
|
|
|
2.2
|
|
(Gain) loss on
extinguishment of debt, net
|
|
(1.5)
|
|
|
0.3
|
|
Loss from equity
method investment
|
|
—
|
|
|
5.4
|
|
Changes in working
capital pertaining to operating activities:
|
|
|
|
|
Receivables
|
|
12.7
|
|
|
(7.0)
|
|
Inventories
|
|
(46.6)
|
|
|
(7.0)
|
|
Accounts
payable
|
|
6.0
|
|
|
30.6
|
|
Accrued
liabilities
|
|
(1.3)
|
|
|
(7.3)
|
|
Deferred
revenue
|
|
(0.9)
|
|
|
0.9
|
|
Interest
payable
|
|
10.8
|
|
|
11.3
|
|
Income
taxes
|
|
(2.4)
|
|
|
2.1
|
|
Other
|
|
(3.5)
|
|
|
3.1
|
|
Net cash provided by
operating activities
|
|
120.5
|
|
|
170.6
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
Capital
expenditures
|
|
(81.5)
|
|
|
(70.7)
|
|
Sale of equity method
investment
|
|
—
|
|
|
4.0
|
|
Other investing
activities
|
|
0.2
|
|
|
0.3
|
|
Net cash used in
investing activities
|
|
(81.3)
|
|
|
(66.4)
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
Proceeds from
issuance of long-term debt
|
|
—
|
|
|
45.0
|
|
Repayment of
long-term debt
|
|
(90.5)
|
|
|
(45.4)
|
|
Debt issuance
costs
|
|
(2.0)
|
|
|
(0.5)
|
|
Proceeds from
revolving credit facility
|
|
392.6
|
|
|
127.2
|
|
Repayment of
revolving credit facility
|
|
(354.3)
|
|
|
(152.2)
|
|
Repayment of
financing obligation
|
|
(2.1)
|
|
|
(1.9)
|
|
Acquisition of
additional interest in the Partnership
|
|
—
|
|
|
(4.2)
|
|
Cash distribution to
noncontrolling interests
|
|
(14.2)
|
|
|
(24.8)
|
|
Shares
repurchased
|
|
(13.2)
|
|
|
—
|
|
Other financing
activities
|
|
(7.5)
|
|
|
0.8
|
|
Net cash used in
financing activities
|
|
(91.2)
|
|
|
(56.0)
|
|
Net (decrease)
increase in cash and cash equivalents
|
|
(52.0)
|
|
|
48.2
|
|
Cash and cash
equivalents at beginning of period
|
|
145.7
|
|
|
120.2
|
|
Cash and cash
equivalents at end of period
|
|
$
|
93.7
|
|
|
$
|
168.4
|
|
Supplemental
Disclosure of Cash Flow Information
|
|
|
|
|
Interest paid, net of
capitalized interest of $2.3 million and $2.2 million,
respectively
|
|
$
|
32.3
|
|
|
$
|
32.4
|
|
Income taxes paid,
net of refunds of zero and $3.2 million, respectively
|
|
$
|
8.8
|
|
|
$
|
3.4
|
|
SunCoke Energy,
Inc.
Segment Financial
and Operating Data
|
|
The following tables
set forth financial and operating data for the three and nine
months ended September 30, 2019 and 2018:
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions, except per ton amounts)
|
Sales and other
operating revenues:
|
|
|
|
|
|
|
|
|
Domestic
Coke
|
|
$
|
378.5
|
|
|
$
|
326.8
|
|
|
$
|
1,115.8
|
|
|
$
|
973.6
|
|
Brazil
Coke
|
|
9.6
|
|
|
9.7
|
|
|
29.3
|
|
|
30.0
|
|
Logistics
|
|
16.2
|
|
|
28.0
|
|
|
58.0
|
|
|
78.4
|
|
Logistics
intersegment sales
|
|
6.1
|
|
|
5.7
|
|
|
19.3
|
|
|
16.6
|
|
Elimination of
intersegment sales
|
|
(6.1)
|
|
|
(5.7)
|
|
|
(19.3)
|
|
|
(16.6)
|
|
Total sales and other
operating revenues
|
|
$
|
404.3
|
|
|
$
|
364.5
|
|
|
$
|
1,203.1
|
|
|
$
|
1,082.0
|
|
Adjusted
EBITDA(1):
|
|
|
|
|
|
|
|
|
Domestic
Coke
|
|
$
|
59.8
|
|
|
$
|
49.1
|
|
|
$
|
174.6
|
|
|
$
|
156.3
|
|
Brazil
Coke
|
|
3.9
|
|
|
4.5
|
|
|
12.7
|
|
|
14.0
|
|
Logistics
|
|
9.6
|
|
|
21.0
|
|
|
34.1
|
|
|
54.3
|
|
Corporate and
Other(2)
|
|
(6.6)
|
|
|
(8.6)
|
|
|
(24.3)
|
|
|
(27.3)
|
|
Total Adjusted
EBITDA
|
|
$
|
66.7
|
|
|
$
|
66.0
|
|
|
$
|
197.1
|
|
|
$
|
197.3
|
|
Coke Operating
Data:
|
|
|
|
|
|
|
|
|
Domestic Coke
capacity utilization
|
|
99
|
%
|
|
95
|
%
|
|
98
|
%
|
|
94
|
%
|
Domestic Coke
production volumes (thousands of tons)
|
|
1,059
|
|
|
1,011
|
|
|
3,095
|
|
|
2,972
|
|
Domestic Coke sales
volumes (thousands of tons)
|
|
1,057
|
|
|
1,012
|
|
|
3,091
|
|
|
2,993
|
|
Domestic Coke
Adjusted EBITDA per ton(3)
|
|
$
|
56.58
|
|
|
$
|
48.52
|
|
|
$
|
56.49
|
|
|
$
|
52.22
|
|
Brazilian Coke
production—operated facility (thousands of tons)
|
|
427
|
|
|
454
|
|
|
1,270
|
|
|
1,326
|
|
Logistics
Operating Data:
|
|
|
|
|
|
|
|
|
Tons handled
(thousands of tons)(4)
|
|
4,706
|
|
|
6,943
|
|
|
16,082
|
|
|
19,744
|
|
CMT take-or-pay
shortfall tons (thousands of tons)(5)
|
|
1,717
|
|
|
42
|
|
|
3,244
|
|
|
147
|
|
|
|
(1)
|
See definition of
Adjusted EBITDA and reconciliation to GAAP elsewhere in this
release.
|
(2)
|
Corporate and Other
includes the activity from our legacy coal mining business, which
contributed Adjusted EBITDA losses of $2.0 million and $5.8 million
during the three and nine months ended September 30, 2019,
respectively, and $2.9 million and $7.6 million during the three
and nine months ended September 30, 2018, respectively.
|
(3)
|
Reflects Domestic
Coke Adjusted EBITDA divided by Domestic Coke sales
volumes.
|
(4)
|
Reflects inbound tons
handled during the period.
|
(5)
|
Reflects tons billed
under take-or-pay contracts where services have not yet been
performed. The Company has established a reserve against the
shortfall tons billed during the three and nine months ended
September 30, 2019 as collection is not probable. As the
obligations related to these billings had not been satisfied, the
related deferred revenue was also reduced by an equal amount,
resulting in no impact to net income (loss) for the three and nine
months ended September 30, 2019.
|
SunCoke Energy,
Inc.
Reconciliation of
Non-GAAP Information
Net (Loss) Income
to Adjusted EBITDA
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
(Dollars in
millions)
|
Net (loss)
income
|
|
$
|
(163.1)
|
|
|
$
|
17.1
|
|
|
$
|
(147.6)
|
|
|
$
|
41.5
|
|
Add:
|
|
|
|
|
|
|
|
|
Long-lived asset and
goodwill impairment
|
|
247.4
|
|
|
—
|
|
|
247.4
|
|
|
—
|
|
Depreciation and
amortization expense
|
|
35.6
|
|
|
35.4
|
|
|
109.8
|
|
|
100.3
|
|
Interest expense,
net
|
|
15.7
|
|
|
15.4
|
|
|
45.6
|
|
|
46.9
|
|
(Gain) loss on
extinguishment of debt, net
|
|
(1.5)
|
|
|
—
|
|
|
(1.5)
|
|
|
0.3
|
|
Income tax (benefit)
expense
|
|
(63.5)
|
|
|
(2.4)
|
|
|
(57.3)
|
|
|
1.8
|
|
Contingent
consideration adjustments(1)
|
|
(3.9)
|
|
|
0.5
|
|
|
(4.2)
|
|
|
1.1
|
|
Loss from equity
method investment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.4
|
|
Simplification
Transaction costs(2)
|
|
—
|
|
|
—
|
|
|
4.9
|
|
|
—
|
|
Adjusted
EBITDA
|
|
66.7
|
|
|
66.0
|
|
|
197.1
|
|
|
197.3
|
|
Subtract: Adjusted
EBITDA attributable to noncontrolling
interest(3)
|
|
1.6
|
|
|
21.0
|
|
|
39.1
|
|
|
61.6
|
|
Adjusted EBITDA
attributable to SunCoke Energy, Inc.
|
|
$
|
65.1
|
|
|
$
|
45.0
|
|
|
$
|
158.0
|
|
|
$
|
135.7
|
|
|
|
(1)
|
In connection with
the CMT acquisition, the Company entered into a contingent
consideration arrangement that requires the Company to make future
payments to the seller based on future volume over a specified
threshold, price and contract renewals. Contingent
consideration adjustments were primarily the result of
modifications to the volume forecast. Customer events during
the third quarter of 2019 drove a decrease in our forecast such
that the contingent consideration liability was reduced to
zero.
|
(2)
|
Costs expensed by the
Partnership associated with the Simplification
Transaction.
|
(3)
|
Reflects
noncontrolling interest in Indiana Harbor and the portion of the
Partnership owned by public unitholders prior to the closing of the
Simplification Transaction.
|
SunCoke Energy,
Inc.
Reconciliation of
Non-GAAP Information
Net Loss to
Adjusted Net Income Attributable to SunCoke Energy,
Inc.
|
|
|
|
Three Months
Ended
September 30,
|
|
|
2019
|
|
|
(Dollars in
millions)
|
Net loss
attributable to SunCoke Energy, Inc.
|
|
$
|
(163.0)
|
|
Add:
|
|
|
Long-lived asset and
goodwill impairment
|
|
247.4
|
|
Contingent
consideration adjustments(1)
|
|
(3.9)
|
|
Related income tax
benefit(2)
|
|
(68.7)
|
|
Adjusted net
income attributable to SunCoke Energy, Inc.
|
|
$
|
11.8
|
|
Adjusted earnings
attributable to SunCoke Energy, Inc. per common share:
|
|
|
Basic
|
|
0.13
|
|
Diluted
|
|
0.13
|
|
Weighted average
number of common shares outstanding:
|
|
|
Basic
|
|
89.9
|
|
Diluted
|
|
89.9
|
|
|
|
(1)
|
In connection with
the CMT acquisition, the Company entered into a contingent
consideration arrangement that requires the Company to make future
payments to the seller based on future volume over a specified
threshold, price and contract renewals. Customer events
during the third quarter of 2019 drove a decrease in our forecast
such that the contingent consideration liability was reduced to
zero.
|
(2)
|
Reflects the tax
impacts of long-lived asset and goodwill impairment and the
contingent consideration adjustment.
|
SunCoke Energy,
Inc.
Reconciliation of
Non-GAAP Information
Estimated 2019 Net
Loss
to Estimated
Consolidated Adjusted EBITDA
|
|
|
|
2019
|
|
|
Low
|
|
High
|
Net
loss
|
|
$
|
(158)
|
|
|
$
|
(151)
|
|
Add:
|
|
|
|
|
Long-lived asset and
goodwill impairment
|
|
247
|
|
|
247
|
|
Depreciation and
amortization expense
|
|
150
|
|
|
145
|
|
Interest expense,
net
|
|
60
|
|
|
60
|
|
Gain on
extinguishment of debt, net
|
|
(2)
|
|
|
(2)
|
|
Income tax
benefit
|
|
(58)
|
|
|
(50)
|
|
Contingent
consideration adjustments(1)
|
|
(4)
|
|
|
(4)
|
|
Simplification
Transaction costs(2)
|
|
5
|
|
|
5
|
|
Adjusted
EBITDA
|
|
$
|
240
|
|
|
$
|
250
|
|
Subtract:
|
|
|
|
|
Adjusted EBITDA
attributable to noncontrolling interests(3)
|
|
40
|
|
|
44
|
|
Adjusted EBITDA
attributable to SunCoke Energy, Inc.
|
|
$
|
200
|
|
|
$
|
206
|
|
|
|
(1)
|
In connection with
the CMT acquisition, the Company entered into a contingent
consideration arrangement that requires the Company to make future
payments to the seller based on future volume over a specified
threshold, price and contract renewals. Customer events
during the third quarter of 2019 drove a decrease in our forecast
such that the contingent consideration liability was reduced to
zero.
|
(2)
|
Costs expensed by the
Partnership associated with the Simplification
Transaction.
|
(3)
|
Reflects
noncontrolling interest in Indiana Harbor and the portion of the
Partnership owned by public unitholders prior to the closing of the
Simplification Transaction.
|
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SOURCE SunCoke Energy, Inc.