Core Natural Resources, Inc.

11/06/2025 | Press release | Distributed by Public on 11/06/2025 05:57

Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) in conjunction with the Consolidated Financial Statements and corresponding notes included elsewhere in this Quarterly Report on Form 10-Q. In addition, this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements for the three-year period ended December 31, 2024 included in the Company's Annual Report on Form 10-K, filed on February 20, 2025. This MD&A contains forward-looking statements, and the matters discussed in these forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those projected or implied in the forward-looking statements. Please see "Risk Factors" and "Forward-Looking Statements" for a discussion of the uncertainties, risks and assumptions associated with these statements.
All amounts discussed are in millions of U.S. dollars, unless otherwise indicated. All tons discussed are on a clean coal equivalent basis.
Recent Developments
Merger
On January 14, 2025, the Company completed the Merger with Arch. Pursuant to the terms of the Merger Agreement, Merger Sub merged with and into Arch, with Arch continuing as the surviving corporation and as a wholly-owned subsidiary of the Company. See Note 2 - Merger with Arch in the Notes to the Consolidated Financial Statements in Item 1 of this Quarterly Report on Form 10-Q for additional information.
Prior to the completion of the Merger, the Company consisted of two reportable segments, the PAMC segment and the CONSOL Marine Terminal segment. Following completion of the Merger, the Company adjusted its internal reporting structure, and the Company's chief operating decision maker ("CODM") changed the manner in which he measures financial performance and allocates resources. Thus, the Company reassessed its reporting segments and the Company now consists of four reportable segments: (1) the High CV Thermal segment; (2) the Metallurgical segment; (3) the Powder River Basin ("PRB") segment; and (4) the Baltimore Marine Terminal segment. Accordingly, the manner in which the Company reports its operations has been changed retrospectively, and all relevant prior period amounts have been recast to reflect this change.
Combustion-Related Activity at Leer South Mine
On January 13, 2025, an isolated combustion-related activity was reported at the Leer South mine, located in Barbour County, West Virginia. The Company temporarily sealed the Leer South mine's active longwall panel in order to extinguish such activity. The Company resumed development work with continuous miners in February 2025, and Company personnel and regulatory officials re-entered the sealed area of the mine on June 10, 2025. Thereafter, ventilation to the full mine was re-established, hydraulic pressure along the longwall face was restored and an extensive evaluation of the mine's major equipment and infrastructure was conducted. As expected, the longwall was largely unaffected by the combustion event, and major components and systems remain in good condition. On June 26, 2025, the operating team found it necessary to evacuate the mine and begin restoring pumpable seals to the affected area in the wake of an increase in carbon monoxide levels. The Company has continued to work closely with federal and state officials on a plan to recover and reposition the longwall equipment and is currently waiting on approval of the plan by the federal Mine Safety and Health Administration; however, this has been delayed due to the government shutdown.
The Company currently expects to incur fire extinguishment and idle costs of $15 million to $25 million at Leer South in the fourth quarter of 2025. Our initial advancement of insurance proceeds was $19.4 million, and the Company will continue to pursue all avenues for additional recoveries as we work to reopen the mine.
One Big Beautiful Bill Act
On July 4, 2025, H.R. 1, the One Big Beautiful Bill Act (the "OBBBA") was signed into law by the President of the U.S. Several provisions included in the OBBBA are expected to benefit the Company, including language designating U.S.-produced metallurgical coal as a "critical material" under Internal Revenue Code Section 45X (Advanced Manufacturing Production Credit), through which the Company will be eligible for a 2.5% monetizable tax credit on production-related costs beginning in 2026 and sunsetting at the end of 2029. The Company is currently evaluating the OBBBA provisions, and the determination as to the applicability and extent of the OBBBA's provisions on the Company's future results of operations and cash flows will be dependent upon interpretations of the law and revenue rulings issued by the U.S. Treasury Department.
Executive Orders
President Trump issued a series of executive orders in April 2025 intended to reduce the regulatory burden on U.S. coal-based power plants and to ensure the long-term preservation of the U.S. coal fleet. The Trump Administration views the coal fleet as essential to the security, resilience and reliability of the U.S. power system.
Our Business
We are a world-class producer and exporter of high-quality, low-cost coals, including metallurgical and thermal coals. With a focus on seaborne markets, we play an essential role in meeting the world's growing need for steel, infrastructure and energy and have ownership interests in two marine export terminals.
The Merger joined two proven leadership teams and operating platforms to establish Core, a premier North American coal producer and exporter of high-quality, low-cost coals with offerings ranging from metallurgical to high calorific value and other thermal coals. With mining operations and terminal facilities across six states, Core owns 11 mines, including one of the largest, lowest cost and highest calorific value thermal coal mining complexes in North America and one of the largest, lowest cost and highest quality metallurgical coal mine portfolios in the U.S. Core also has access to global markets via ownership interests in two export terminals on the U.S. Eastern seaboard, along with strategic connectivity to ports on the West Coast and the Gulf of America. The combined company expects to realize meaningful operating synergies through the optimization of support functions, greatly enhanced marketing opportunities and a significantly expanded logistics network, which will enhance the Company's ability to deliver coal reliably and efficiently to its global customers.
How We Evaluate Our Operations
Our management team uses a variety of financial and operating metrics to analyze our performance. These metrics are significant factors in assessing our operating results and profitability. The metrics include: (i) coal production and sales volumes; (ii) realized coal revenue, a non-GAAP financial measure; (iii) realized coal revenue per ton sold, an operating ratio derived from non-GAAP financial measures; (iv) cash cost of coal sold, a non-GAAP financial measure; (v) cash cost of coal sold per ton, an operating ratio derived from non-GAAP financial measures; (vi) cash margin per ton sold, an operating ratio derived from non-GAAP financial measures, defined as realized coal revenue per ton sold less cash cost of coal sold per ton; and (vii) adjusted EBITDA, a non-GAAP financial measure.
We believe that realized coal revenue and realized coal revenue per ton sold better reflect our revenue for the quality of coal sold and our operating results by including all income from coal sales. We believe cash cost of coal sold, cash cost of coal sold per ton and cash margin per ton sold normalize the volatility contained within comparable GAAP measures by adjusting for certain non-operating or non-cash transactions. We believe that adjusted EBITDA provides a helpful measure of comparing our operating performance with the performance of other companies that have different financing, capital structures and tax rates than ours. Each of these non-GAAP measures are used as supplemental financial measures by management and by external users of our financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:
•our operating performance compared to the operating performance of other companies in the coal industry, without regard to financing methods, historical cost basis, tax rates or capital structure;
•the ability of our assets to generate sufficient cash flow;
•our ability to incur and service debt and fund capital expenditures;
•the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities; and
•the attractiveness of capital projects and acquisitions and the overall rates of return on alternative investment opportunities.
These non-GAAP financial measures should not be considered an alternative to cost of sales, net income (loss) or any other measure of financial performance presented in accordance with GAAP. These measures exclude some, but not all, items that affect measures presented in accordance with GAAP, and these measures and the way we calculate them may vary from those of other companies. As a result, the items presented below may not be comparable to similarly titled measures of other companies.
Reconciliation of Non-GAAP Financial Measures
We define realized coal revenue as revenues reported in the Consolidated Statements of Income (Loss) less transportation costs, transloading revenues and other revenues not directly attributable to coal sales. We define realized coal revenue per ton sold as realized coal revenue divided by tons sold. The following tables present reconciliations by
reportable segment of realized coal revenue and realized coal revenue per ton sold to revenues, the most directly comparable GAAP financial measure (in thousands, except per ton information):
Three Months Ended September 30, 2025
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Revenues $ 514,721 $ 292,694 $ 186,366 $ 19,778 $ 3,171 $ (14,187) $ 1,002,543
Less: Adjustments to Reconcile to Segment Realized Coal Revenue
Transportation Costs 82,550 66,912 2,830 - - - 152,292
Intersegment Terminal Revenues - - - 14,187 - (14,187) -
Non-Coal Revenues - - - 5,591 3,171 - 8,762
Segment Realized Coal Revenue $ 432,171 $ 225,782 $ 183,536 $ - $ - $ - $ 841,489
Tons Sold 7,229 2,222 13,030
Realized Coal Revenue per Ton Sold $ 59.78 $ 101.60 $ 14.09
Three Months Ended September 30, 2024
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Revenues $ 517,720 $ 24,425 $ - $ 23,740 $ 3,797 $ (16,250) $ 553,432
Less: Adjustments to Reconcile to Segment Realized Coal Revenue
Transportation Costs 77,990 1,666 - - - - 79,656
Intersegment Terminal Revenues - - - 16,250 - (16,250) -
Non-Coal Revenues - - - 7,490 3,797 - 11,287
Segment Realized Coal Revenue $ 439,730 $ 22,759 $ - $ - $ - $ - $ 462,489
Tons Sold 6,840 152 -
Realized Coal Revenue per Ton Sold $ 64.28 $ 149.85 $ -
Nine Months Ended September 30, 2025
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Revenues $ 1,663,307 $ 897,268 $ 535,827 $ 63,575 $ 10,821 $ (48,488) $ 3,122,310
Less: Adjustments to Reconcile to Segment Realized Coal Revenue
Transportation Costs 275,363 210,982 8,030 - - - 494,375
Intersegment Terminal Revenues - - - 48,488 - (48,488) -
Non-Coal Revenues - - - 15,087 10,821 - 25,908
Segment Realized Coal Revenue $ 1,387,944 $ 686,286 $ 527,797 $ - $ - $ - $ 2,602,027
Tons Sold 22,714 6,773 36,293
Realized Coal Revenue per Ton Sold $ 61.11 $ 101.32 $ 14.54
Nine Months Ended September 30, 2024
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Revenues $ 1,469,201 $ 87,024 $ - $ 60,288 $ 11,927 $ (37,599) $ 1,590,841
Less: Adjustments to Reconcile to Segment Realized Coal Revenue
Transportation Costs 228,842 7,645 - - - - 236,487
Intersegment Terminal Revenues - - - 37,599 - (37,599) -
Non-Coal Revenues - - - 22,689 11,927 - 34,616
Segment Realized Coal Revenue $ 1,240,359 $ 79,379 $ - $ - $ - $ - $ 1,319,738
Tons Sold 18,684 509 -
Realized Coal Revenue per Ton Sold $ 66.39 $ 155.99 $ -
We evaluate our cash cost of coal sold on an aggregate basis by segment and our cash cost of coal sold per ton on a per-ton basis. Cash cost of coal sold includes items such as direct operating costs, royalty and production taxes and direct administration costs, and excludes transportation costs, indirect costs, other costs not directly attributable to the production of coal and depreciation, depletion and amortization costs on production assets. We define cash cost of coal sold per ton as cash cost of coal sold divided by tons sold. The following tables present reconciliations by reportable segment of cash cost of coal sold and cash cost of coal sold per ton to cost of sales, the most directly comparable GAAP financial measure (in thousands, except per ton information):
Three Months Ended September 30, 2025
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Cost of Sales $ 375,552 $ 275,222 $ 172,775 $ 7,626 $ 10,484 $ (14,187) $ 827,472
Less: Adjustments to Reconcile to Segment Cash Cost of Coal Sold
Transportation Costs 69,704 65,571 2,830 - - - 138,105
Cost of Sales from Idled Operations - 18,375 - - 5,080 - 23,455
Insurance Reimbursements - (19,350) - - - - (19,350)
Intersegment Transloading Costs 12,846 1,341 - - - (14,187) -
Terminal Operating Costs - - - 7,626 - - 7,626
Other Non-Active Mining Costs - - - - 5,404 - 5,404
Segment Cash Cost of Coal Sold $ 293,002 $ 209,285 $ 169,945 $ - $ - $ - $ 672,232
Tons Sold 7,229 2,222 13,030
Cash Cost of Coal Sold per Ton $ 40.53 $ 94.18 $ 13.04
Three Months Ended September 30, 2024
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Cost of Sales $ 323,242 $ 33,060 $ - $ 6,919 $ 7,447 $ (16,250) $ 354,418
Less: Adjustments to Reconcile to Segment Cash Cost of Coal Sold
Transportation Costs 62,219 1,187 - - - - 63,406
Cost of Sales from Idled Operations - - - - 1,291 - 1,291
Intersegment Transloading Costs 15,771 479 - - - (16,250) -
Terminal Operating Costs - - - 6,919 - - 6,919
Other Non-Active Mining Costs - - - - 6,156 - 6,156
Segment Cash Cost of Coal Sold $ 245,252 $ 31,394 $ - $ - $ - $ - $ 276,646
Tons Sold 6,840 152 -
Cash Cost of Coal Sold per Ton $ 35.85 $ 206.71 $ -
Nine Months Ended September 30, 2025
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Cost of Sales $ 1,202,984 $ 902,081 $ 479,379 $ 23,028 $ 51,358 $ (48,488) $ 2,610,342
Less: Adjustments to Reconcile to Segment Cash Cost of Coal Sold
Transportation Costs 229,997 207,860 8,030 - - - 445,887
Cost of Sales from Idled Operations - 76,024 - - 14,644 - 90,668
Insurance Reimbursements - (19,350) - - - - (19,350)
Intersegment Transloading Costs 45,366 3,122 - - - (48,488) -
Terminal Operating Costs - - - 23,028 - - 23,028
Other Non-Active Mining Costs - - - - 36,714 - 36,714
Segment Cash Cost of Coal Sold $ 927,621 $ 634,425 $ 471,349 $ - $ - $ - $ 2,033,395
Tons Sold 22,714 6,773 36,293
Cash Cost of Coal Sold per Ton $ 40.84 $ 93.67 $ 12.99
Nine Months Ended September 30, 2024
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Idle and Other Eliminations Consolidated
Cost of Sales $ 946,790 $ 107,507 $ - $ 20,223 $ 15,574 $ (37,599) $ 1,052,495
Less: Adjustments to Reconcile to Segment Cash Cost of Coal Sold
Transportation Costs 192,569 6,319 - - - - 198,888
Cost of Sales from Idled Operations - - - - 4,003 - 4,003
Intersegment Transloading Costs 36,273 1,326 - - - (37,599) -
Terminal Operating Costs - - - 20,223 - - 20,223
Other Non-Active Mining Costs - - - - 11,571 - 11,571
Segment Cash Cost of Coal Sold $ 717,948 $ 99,862 $ - $ - $ - $ - $ 817,810
Tons Sold 18,684 509 -
Cash Cost of Coal Sold per Ton $ 38.43 $ 196.25 $ -
We define adjusted EBITDA as (i) net income (loss) plus income taxes, net interest expense and depreciation, depletion and amortization, as adjusted for (ii) certain non-cash items, such as loss on debt extinguishment and (iii) other adjustments, such as stock-based compensation and Merger-related expenses. Adjusted EBITDA may also be adjusted for items that may not reflect the trend of future results by excluding transactions that are not indicative of our operating performance or that arise outside of the ordinary course of our business. The following tables present reconciliations by reportable segment of adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure (in thousands):
Three Months Ended September 30, 2025
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Other and Corporate Consolidated
Net Income (Loss) $ 86,327 $ (47,909) $ 4,796 $ 10,754 $ (22,370) $ 31,598
Income Tax Benefit - - - - (52,998) (52,998)
Interest Expense, net - - - - 3,028 3,028
Depreciation, Depletion and Amortization 52,842 65,381 8,795 1,398 22,590 151,006
Other Adjustments - - - - 8,548 8,548
Adjusted EBITDA $ 139,169 $ 17,472 $ 13,591 $ 12,152 $ (41,202) $ 141,182
Three Months Ended September 30, 2024
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Other and Corporate Consolidated
Net Income (Loss) $ 153,873 $ (10,691) $ - $ 15,545 $ (63,095) $ 95,632
Income Tax Expense - - - - 17,539 17,539
Interest Income, net - - - - (352) (352)
Depreciation, Depletion and Amortization 42,306 2,056 - 1,276 7,691 53,329
Other Adjustments - - - - 13,030 13,030
Adjusted EBITDA $ 196,179 $ (8,635) $ - $ 16,821 $ (25,187) $ 179,178
Nine Months Ended September 30, 2025
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Other and Corporate Consolidated
Net Income (Loss) $ 304,170 $ (191,400) $ 31,207 $ 36,376 $ (254,588) $ (74,235)
Income Tax Benefit - - - - (50,098) (50,098)
Interest Expense, net - - - - 8,379 8,379
Depreciation, Depletion and Amortization 156,153 186,587 25,241 4,171 69,673 441,825
Loss on Debt Extinguishment - - - - 11,680 11,680
Other Adjustments - - - - 71,386 71,386
Adjusted EBITDA $ 460,323 $ (4,813) $ 56,448 $ 40,547 $ (143,568) $ 408,937
Nine Months Ended September 30, 2024
High CV Thermal Metallurgical PRB Baltimore Marine Terminal Other and Corporate Consolidated
Net Income (Loss) $ 396,286 $ (26,750) $ - $ 36,521 $ (150,473) $ 255,584
Income Tax Expense - - - - 43,409 43,409
Interest Expense, net - - - - 918 918
Depreciation, Depletion and Amortization 129,146 6,267 - 3,544 26,216 165,173
Other Adjustments - - - - 20,385 20,385
Adjusted EBITDA $ 525,432 $ (20,483) $ - $ 40,065 $ (59,545) $ 485,469
Results of Operations: Three Months Ended September 30, 2025 Compared with the Three Months Ended September 30, 2024
Revenues
The Company's revenues primarily include sales to customers of coal produced at our operations and, to a lesser extent, coal purchased from third parties. The Company's revenues also include transloading services at the Port of Baltimore, as well as other revenues generated from customers.
Our presence in the metallurgical coal market has expanded through the Merger with two longwall mines and two continuous miner mines in West Virginia that produce a premium metallurgical product used in the global steel industry. We also gained two thermal surface mines in the Powder River Basin, as well as another thermal longwall mine in Colorado. The thermal surface mines produce thermal coal for sale into domestic and international markets, while the thermal longwall mine produces a high-quality, high calorific value thermal product that can compete effectively in seaborne markets.
Consolidated revenues in the three months ended September 30, 2025 were $449 million higher than the three months ended September 30, 2024. As a result of the Merger, the legacy Arch operations contributed $513 million of revenues in the three months ended September 30, 2025, primarily from coal sales in the Metallurgical and PRB segments. The revenues of legacy CONSOL's PAMC decreased $53 million in the period-to-period comparison, primarily due to lower sales tons and reduced realization. The revenues of legacy CONSOL's Itmann mine decreased $7 million in the period-to-period comparison, primarily due to lower sales tons and reduced metallurgical coal benchmark pricing. The revenues of the Baltimore Marine Terminal decreased $4 million in the period-to-period comparison, primarily due to lower throughput volumes. See the discussion in "Operational Performance" below for further information about segment results.
Cost of Sales
Cost of sales includes items such as direct operating costs, royalty and production taxes, direct administration costs and transportation costs. Our consolidated cost of sales in the three months ended September 30, 2025 increased $473 million compared to the three months ended September 30, 2024. As a result of the Merger, the legacy Arch operations incurred cost of sales of $482 million during the three months ended September 30, 2025. Cost of sales at legacy CONSOL's PAMC and the Itmann mine decreased $15 million in the period-to-period comparison, primarily due to decreased sales tons. Cost of sales at the Baltimore Marine Terminal increased $1 million in the period-to-period comparison. See the discussion in "Operational Performance" below for further information about segment results. The remaining $5 million increase in the period-to-period comparison was the result of additional operating overhead and certain actuarial costs during the three months ended September 30, 2025.
Depreciation, Depletion and Amortization
On a consolidated basis, depreciation, depletion and amortization costs were $151 million for the three months ended September 30, 2025, compared to $53 million for the three months ended September 30, 2024, resulting in a $98 million increase. The assets acquired in the Merger resulted in an additional $93 million of depreciation, depletion and amortization expense in the three months ended September 30, 2025. See Note 2 - Merger with Arch in the Notes to the Consolidated Financial Statements in Item 1 of this Quarterly Report on Form 10-Q for additional information. The remaining increase was primarily the result of additional capital expenditures at the legacy CONSOL operations and adjustments to the Company's asset retirement obligations in the three months ended September 30, 2025, none of which were individually material.
General and Administrative Costs
On a consolidated basis, general and administrative costs were $34 million for the three months ended September 30, 2025, compared to $36 million for the three months ended September 30, 2024. The $2 million decrease in the period-to-period comparison was primarily due to non-recurring transaction costs, including fees paid to financial, legal and accounting advisors, severance and benefit costs, filing fees and debt restructuring costs, incurred during the three months ended September 30, 2024 as a result of the Merger, partially offset by increased headcount as a combined company. See Note 2 - Merger with Arch in the Notes to the Consolidated Financial Statements in Item 1 of this Quarterly Report on Form 10-Q for additional information.
Other Operating (Expense) Income, net
Other operating (expense) income, net changed by $10 million in the period-to-period comparison due to the following items:
Three Months Ended September 30,
2025 2024 Variance
Royalty Income - Non-Operated Coal $ 9 $ 7 $ 2
Contract Assessments - 8 (8)
Land Holding and Administrative Costs (10) (2) (8)
Other (1) (5) 4
Total Other Operating (Expense) Income, net $ (2) $ 8 $ (10)
Royalty income increased as a result of additional leased coal volumes related to overriding royalty agreements or coal reserve leases between the Company and third-party operators.
There were no contract assessments during the three months ended September 30, 2025. Contract assessment income during the three months ended September 30, 2024 was primarily the result of penalties and fees levied against customers that did not meet the purchase obligations under their contracts with the Company.
Land holding and administrative costs increased primarily due to the acquisition of various coal leases and land holdings as a result of the Merger.
Interest Expense and Interest Income
On a consolidated basis, interest expense was $11 million for the three months ended September 30, 2025, compared to $5 million for the three months ended September 30, 2024. The $6 million increase in the period-to-period comparison was primarily due to interest incurred on the WVEDA Bonds (as defined below), as well as interest incurred on additional equipment financing arrangements.
Interest income increased $3 million in the period-to-period comparison primarily as a result of increased cash and cash equivalents.
Non-Service Related Pension and Postretirement Benefit Costs
Non-service related pension and postretirement benefit costs increased $2 million in the period-to-period comparison, primarily due to the impact of changes in actuarial assumptions made at the beginning of each year and as a result of the Merger.
Operational Performance: Three Months Ended September 30, 2025 Compared with the Three Months Ended September 30, 2024
The Company consists of four reportable segments: (1) the High CV Thermal segment; (2) the Metallurgical segment; (3) the PRB segment; and (4) the Baltimore Marine Terminal segment. The High CV Thermal segment consists of the Company's Pennsylvania Mining Complex and the West Elk mine located in Colorado. The Metallurgical segment consists of the Company's Leer, Leer South, Beckley, Mountain Laurel and Itmann coal mines in West Virginia. The PRB segment consists of the Company's Black Thunder and Coal Creek surface mining complexes located in Wyoming. The Baltimore Marine Terminal segment consists of the Company's coal export terminal operations in the Port of Baltimore.
Most of the production from the PRB segment is sold to U.S. power generators, who in recent years have indicated a shift in their generating capacity to other, non-coal fuel and energy sources. As such, the Company is managing its operational footprint at its PRB operations to meet current demand and has put in place funding to pay for the eventual closure and final reclamation of these operations.
The Company evaluates the performance of its segments utilizing Adjusted EBITDA and various productivity metrics. Adjusted EBITDA measures the operating performance of the Company's segments and is used to allocate resources to the Company's segments. The following table presents results by reportable segment:
Three Months Ended September 30,
2025 2024 Variance
High CV Thermal Segment
Total Tons Produced (in millions) 7.6 7.2 0.4
Total Tons Sold (in millions) 7.2 6.8 0.4
Realized Coal Revenue per Ton Sold (1)
$ 59.78 $ 64.28 $ (4.50)
Cash Cost of Coal Sold per Ton (1)
$ 40.53 $ 35.85 $ 4.68
Cash Margin per Ton Sold (1)
$ 19.25 $ 28.43 $ (9.18)
Adjusted EBITDA (in thousands) (1)
$ 139,169 $ 196,179 $ (57,010)
Metallurgical Segment
Total Tons Produced (in millions) 2.3 0.2 2.1
Total Tons Sold (in millions) 2.2 0.2 2.0
Realized Coal Revenue per Ton Sold (1)
$ 101.60 $ 149.85 $ (48.25)
Cash Cost of Coal Sold per Ton (1)
$ 94.18 $ 206.71 $ (112.53)
Cash Margin per Ton Sold (1)
$ 7.42 $ (56.86) $ 64.28
Adjusted EBITDA (in thousands) (1)
$ 17,472 $ (8,635) $ 26,107
PRB Segment
Total Tons Produced (in millions) 12.9 - 12.9
Total Tons Sold (in millions) 13.0 - 13.0
Realized Coal Revenue per Ton Sold (1)
$ 14.09 $ - $ 14.09
Cash Cost of Coal Sold per Ton (1)
$ 13.04 $ - $ 13.04
Cash Margin per Ton Sold (1)
$ 1.05 $ - $ 1.05
Adjusted EBITDA (in thousands) (1)
$ 13,591 $ - $ 13,591
Baltimore Marine Terminal Segment
Throughput Tons (in millions) 4.0 4.7 (0.7)
Adjusted EBITDA (in thousands) (1)
$ 12,152 $ 16,821 $ (4,669)
(1) Realized coal revenue per ton sold, cash cost of coal sold per ton and cash margin per ton sold are operating ratios derived from non-GAAP financial measures, and Adjusted EBITDA is a non-GAAP financial measure. See "How We Evaluate Our Operations - Reconciliation of Non-GAAP Financial Measures"above for definitions and reconciliations of these amounts to the most directly comparable GAAP measures.
HIGH CV THERMAL SEGMENT ANALYSIS:
Adjusted EBITDA decreased $57 million in the period-to-period comparison, primarily due to reduced realization and a 0.3 million ton decrease in PAMC sales volumes quarter-over-quarter. Realized coal revenue per ton sold was negatively impacted by softened international markets, which weighed on Newcastle prices, coupled with weak demand in Europe, which weighed on API2 pricing.
METALLURGICAL SEGMENT ANALYSIS:
All Metallurgical segment operations, except Itmann, were acquired in the Merger, resulting in additional sales volumes of 2.1 million tons, realized coal revenue of $210 million and cash cost of coal sold of $191 million in the three
months ended September 30, 2025. However, realized coal revenue per ton sold was significantly impacted by reduced metallurgical coal benchmark prices during the three months ended September 30, 2025, which remained challenged due to surplus production within the industry and weak demand. Adjusted EBITDA was also impacted by $18 million of costs incurred during the current quarter related to the combustion incident at the Leer South mine, offset by $19 million of insurance reimbursements.
PRB SEGMENT ANALYSIS:
The PRB segment operations were acquired in the Merger and, as such, there was no activity during the three months ended September 30, 2024. The PRB segment produced 12.9 million tons and sold 13.0 million tons in the three months ended September 30, 2025. Adjusted EBITDA was $14 million in the current quarter.
BALTIMORE MARINE TERMINAL SEGMENT ANALYSIS:
Adjusted EBITDA for the three months ended September 30, 2025 was $12 million, compared to $17 million for the three months ended September 30, 2024. Throughput volumes at the Baltimore Marine Terminal were 4.0 million tons for the three months ended September 30, 2025, compared to 4.7 million tons for the three months ended September 30, 2024. Baltimore Marine Terminal revenue was $20 million for the three months ended September 30, 2025, compared to $24 million for the three months ended September 30, 2024.
Results of Operations: Nine Months Ended September 30, 2025 Compared with the Nine Months Ended September 30, 2024
Revenues
Consolidated revenues in the nine months ended September 30, 2025 were $1,531 million higher than the nine months ended September 30, 2024. As a result of the Merger, the legacy Arch operations contributed $1,532 million of revenues in the nine months ended September 30, 2025, primarily from coal sales in the Metallurgical and PRB segments. The revenues of legacy CONSOL's PAMC increased $9 million in the period-to-period comparison, primarily due to increased sales tons. Revenues from legacy CONSOL's Itmann mine decreased $14 million in the period-to-period comparison, primarily due to reduced metallurgical coal benchmark prices. The revenues of the Baltimore Marine Terminal increased $4 million in the period-to-period comparison, primarily due to the negative impacts of the Francis Scott Key Bridge collapse during the second quarter of 2024. See the discussion in "Operational Performance" below for further information about segment results.
Cost of Sales
Our consolidated cost of sales in the nine months ended September 30, 2025 increased $1,558 million compared to the nine months ended September 30, 2024. As a result of the Merger, the legacy Arch operations incurred cost of sales of $1,495 million during the nine months ended September 30, 2025. Cost of sales at legacy CONSOL's PAMC and the Itmann mine increased $43 million in the period-to-period comparison, primarily due to increased sales tons. Cost of sales at the Baltimore Marine Terminal increased $3 million in the period-to-period comparison, primarily due to increased throughput volumes. See the discussion in "Operational Performance" below for further information about segment results. The remaining $17 million increase was the result of additional operating overhead and certain actuarial costs, as well as costs incurred at the Company's idled locations, during the nine months ended September 30, 2025.
Depreciation, Depletion and Amortization
On a consolidated basis, depreciation, depletion and amortization costs were $442 million for the nine months ended September 30, 2025, compared to $165 million for the nine months ended September 30, 2024, resulting in a $277 million increase. The assets acquired in the Merger resulted in an additional $258 million of depreciation, depletion and amortization expense in the nine months ended September 30, 2025. See Note 2 - Merger with Arch in the Notes to the Consolidated Financial Statements in Item 1 of this Quarterly Report on Form 10-Q for additional information. The remaining increase was primarily the result of additional capital expenditures at the legacy CONSOL operations and adjustments to the Company's asset retirement obligations in the nine months ended September 30, 2025, none of which were individually material.
General and Administrative Costs
On a consolidated basis, general and administrative costs were $158 million for the nine months ended September 30, 2025, compared to $78 million for the nine months ended September 30, 2024. The $81 million increase in the period-to-period comparison was primarily due to increased headcount as a combined company, an increase in long-term incentive
compensation recognized in relation to award modifications due to the Merger and non-recurring transaction costs, including fees paid to financial, legal and accounting advisors, severance and benefit costs, filing fees and debt restructuring costs, as a result of the Merger. See Note 2 - Merger with Arch in the Notes to the Consolidated Financial Statements in Item 1 of this Quarterly Report on Form 10-Q for additional information.
Other Operating (Expense) Income, net
Other operating (expense) income, net changed by $15 million in the period-to-period comparison due to the following items:
Nine Months Ended September 30,
2025 2024 Variance
Royalty Income - Non-Operated Coal $ 23 $ 16 $ 7
Gain on Sale of Assets 6 7 (1)
Contract Assessments - 11 (11)
Land Holding and Administrative Costs (19) (6) (13)
Other (7) (10) 3
Total Other Operating (Expense) Income, net $ 3 $ 18 $ (15)
Royalty income increased as a result of additional leased coal volumes related to overriding royalty agreements or coal reserve leases between the Company and third-party operators.
There were no contract assessments during the nine months ended September 30, 2025. Contract assessment income during the nine months ended September 30, 2024 was primarily the result of penalties and fees levied against customers that did not meet the purchase obligations under their contracts with the Company. This amount also included partial contract buyouts that involved negotiations with customers to reduce coal quantities that they otherwise were obligated to purchase under contracts in exchange for payment of certain fees to the Company and did not impact forward contract terms.
Land holding and administrative costs increased primarily due to the acquisition of various coal leases and land holdings as a result of the Merger.
Interest Expense and Interest Income
On a consolidated basis, interest expense was $29 million for the nine months ended September 30, 2025, compared to $15 million for the nine months ended September 30, 2024. The $14 million increase in the period-to-period comparison was primarily due to interest incurred on the WVEDA Bonds, as well as interest incurred on additional equipment financing arrangements and increased fees associated with the Company's Revolving Credit Facility (as defined below) as a result of the January 2025 amendment.
Interest income increased $6 million in the period-to-period comparison primarily as a result of increased cash and cash equivalents.
Loss on Debt Extinguishment
Loss on debt extinguishment of $12 million was recognized in the nine months ended September 30, 2025 due to the amendment of the Company's Revolving Credit Facility and the refinancing of the Company's tax-exempt bonds. See Note 13 - Long-Term Debt in the Notes to the Consolidated Financial Statements in Item 1 of this Quarterly Report on Form 10-Q for additional information.
Non-Service Related Pension and Postretirement Benefit Costs
Non-service related pension and postretirement benefit costs increased $6 million in the period-to-period comparison, primarily due to the impact of changes in actuarial assumptions made at the beginning of each year and as a result of the Merger.
Operational Performance: Nine Months Ended September 30, 2025 Compared with the Nine Months Ended September 30, 2024
The following table presents results by reportable segment:
Nine Months Ended September 30,
2025 2024 Variance
High CV Thermal Segment
Total Tons Produced (in millions) 22.9 19.3 3.6
Total Tons Sold (in millions) 22.7 18.7 4.0
Realized Coal Revenue per Ton Sold (1)
$ 61.11 $ 66.39 $ (5.28)
Cash Cost of Coal Sold per Ton (1)
$ 40.84 $ 38.43 $ 2.41
Cash Margin per Ton Sold (1)
$ 20.27 $ 27.96 $ (7.69)
Adjusted EBITDA (in thousands) (1)
$ 460,323 $ 525,432 $ (65,109)
Metallurgical Segment
Total Tons Produced (in millions) 6.7 0.5 6.2
Total Tons Sold (in millions) 6.8 0.5 6.3
Realized Coal Revenue per Ton Sold (1)
$ 101.32 $ 155.99 $ (54.67)
Cash Cost of Coal Sold per Ton (1)
$ 93.67 $ 196.25 $ (102.58)
Cash Margin per Ton Sold (1)
$ 7.65 $ (40.26) $ 47.91
Adjusted EBITDA (in thousands) (1)
$ (4,813) $ (20,483) $ 15,670
PRB Segment
Total Tons Produced (in millions) 36.2 - 36.2
Total Tons Sold (in millions) 36.3 - 36.3
Realized Coal Revenue per Ton Sold (1)
$ 14.54 $ - $ 14.54
Cash Cost of Coal Sold per Ton (1)
$ 12.99 $ - $ 12.99
Cash Margin per Ton Sold (1)
$ 1.55 $ - $ 1.55
Adjusted EBITDA (in thousands) (1)
$ 56,448 $ - $ 56,448
Baltimore Marine Terminal Segment
Throughput Tons (in millions) 13.2 11.5 1.7
Adjusted EBITDA (in thousands) (1)
$ 40,547 $ 40,065 $ 482
(1) Realized coal revenue per ton sold, cash cost of coal sold per ton and cash margin per ton sold are operating ratios derived from non-GAAP financial measures, and Adjusted EBITDA is a non-GAAP financial measure. See "How We Evaluate Our Operations - Reconciliation of Non-GAAP Financial Measures"above for definitions and reconciliations of these amounts to the most directly comparable GAAP measures.
HIGH CV THERMAL SEGMENT ANALYSIS:
Adjusted EBITDA decreased $65 million in the period-to-period comparison, primarily due to a $5.28 decrease in realized coal revenue per ton sold as international markets continued to soften, which weighed on Newcastle prices, coupled with weak demand in Europe, which weighed on API2 pricing. The reduced realization was partially offset by a 1.6 million ton increase in PAMC sales volumes year-over-year. Additionally, the West Elk mine was acquired in the Merger, which resulted in additional sales volumes of 2.4 million tons, realized coal revenue of $121 million and cash cost of coal sold of $133 million in the nine months ended September 30, 2025.
METALLURGICAL SEGMENT ANALYSIS:
All Metallurgical segment operations, except Itmann, were acquired in the Merger, resulting in additional sales volumes of 6.3 million tons, realized coal revenue of $621 million and cash cost of coal sold of $560 million in the nine months ended September 30, 2025. However, realized coal revenue per ton sold was significantly impacted by reduced metallurgical coal benchmark prices during the nine months ended September 30, 2025, which remained challenged due to
surplus production within the industry and weak demand. In addition to lower realization, Adjusted EBITDA was also impacted by $76 million of costs incurred during the nine months ended September 30, 2025 related to the combustion incident at the Leer South mine, partially offset by $19 million of insurance reimbursements.
PRB SEGMENT ANALYSIS:
The PRB segment operations were acquired in the Merger, and as such, there was no activity during the nine months ended September 30, 2024. The PRB segment produced 36.2 million tons and sold 36.3 million tons in the nine months ended September 30, 2025. Adjusted EBITDA was $56 million during the nine months ended September 30, 2025.
BALTIMORE MARINE TERMINAL SEGMENT ANALYSIS:
Adjusted EBITDA for the nine months ended September 30, 2025 was $41 million, compared to $40 million for the nine months ended September 30, 2024. In 2024, throughput volumes and revenue from those volumes were interrupted until May 20, 2024 as a result of the Francis Scott Key Bridge collapse. Accordingly, throughput volumes at the Baltimore Marine Terminal were 13.2 million tons for the nine months ended September 30, 2025, compared to 11.5 million tons for the nine months ended September 30, 2024. Baltimore Marine Terminal revenue was $64 million for the nine months ended September 30, 2025, compared to $60 million for the nine months ended September 30, 2024.
Vessel access to, and export capability from, the Baltimore Marine Terminal was restricted on March 26, 2024 after the Francis Scott Key Bridge collapsed. Management worked diligently to minimize the disruption to our business and address direct and indirect impacts to the Company and its operations, including moving coal through an alternative port on the East Coast of the U.S., accelerating domestic shipments and managing ongoing expenditures. On May 20, 2024, a limited access channel in the Chesapeake Bay was opened to commercial vessel traffic and coal shipments to international markets resumed from the Baltimore Marine Terminal. The permanent 700-foot wide, 50-foot deep channel was restored and opened on June 10, 2024.
Liquidity and Capital Resources
The Company's potential sources of liquidity include cash generated from operations, cash on hand, borrowings under the Revolving Credit Facility and Receivables Financing Agreement (which are discussed and defined below) and, if necessary, the ability to issue equity or debt securities. The Company believes that cash generated from these sources, without needing to issue equity or debt securities, will be sufficient to meet its short-term working capital requirements, long-term capital expenditure requirements and debt servicing obligations, as well as to provide required letters of credit or surety bonds necessary for the Company's operations.
On January 14, 2025, the Company completed the Merger with Arch pursuant to the Merger Agreement. In connection with the Merger, the Company entered into an amendment to its existing Revolving Credit Facility. The amendment increased the available revolving commitments from $355 million to $600 million and extended the scheduled maturity date of the Revolving Credit Facility to April 30, 2029. Additionally, the Company reduced the interest rate margin by 75 basis points while further enhancing financial flexibility.
Our total liquidity as of September 30, 2025 was comprised of the following:
(in millions) September 30, 2025
Cash and Cash Equivalents $ 445
Receivables Financing Agreement - Current Availability 220
Revolving Credit Facility - Current Availability 600
Less: Letters of Credit Outstanding (270)
Total Liquidity $ 995
Events that negatively impact our operations, overall financial condition and liquidity could result in our inability to comply with the Revolving Credit Facility's financial covenants. This could limit our ability to borrow under the Revolving Credit Facility if we are unable to obtain necessary waivers or amendments. The Company expects to maintain adequate liquidity through its operating cash flow and cash and cash equivalents on hand, as well as the Revolving Credit Facility and its Receivables Financing Agreement, to fund its working capital needs and capital expenditures in the short-term and long-term.
Uncertainty in the financial markets, tariffs and executive actions by the executive branch of the U.S. Government and certain other foreign nations or sovereignties bring additional potential risks to the Company. These risks could impact
our ability to raise capital in the equity and debt markets, or result in higher costs to obtain additional capital or credit as well as increase potential counterparty defaults. In addition, market disruptions and uncertainty, including as a result of potential tariffs and executive actions, high interest rates and sustained high inflation, may impact the Company's revenues and collection of trade receivables. The Company regularly monitors the creditworthiness of its customers and counterparties and manages credit exposure through payment terms, credit limits, prepayments and security.
The global landscape on rates and the scope of tariffs imposed on goods imported into and out of the U.S. from multiple countries around the world continues to evolve and be uncertain, as the U.S. Government continues to negotiate its position with multiple countries and across various industries and goods. While the evolving global trade landscape relating to tariffs and retaliatory trade measures imposed by other countries on U.S. goods have not yet had a significant impact on our business or results of operations as of September 30, 2025, these or additional changes in U.S. or international trade policy have increased uncertainty regarding the ultimate effect of the tariffs on economic conditions and could lead to further weakened business conditions for the coal industry.
Over the past few years, the insurance and surety markets have been increasingly challenging, particularly for coal companies. We have experienced rising premiums, reduced coverage and/or fewer providers willing to underwrite policies and surety bonds. Terms have generally become more unfavorable, including increases in the amount of collateral required to secure surety bonds. However, more recently, we have seen insurance rates stabilize and even decrease on certain lines of coverage, as new insurance carriers have entered the market. Further cost burdens on our ability to maintain adequate insurance and bond coverage may adversely impact our operations, financial position and liquidity.
At September 30, 2025, the Company had a $125 million fund in place that will cover, in part, future reclamation costs of the thermal assets in the PRB. Additionally, the Company maintains a $15 million Global Water Treatment Trust Fund that will fund future water treatment obligations in Pennsylvania, as well as replace surety bonds and related collateral requirements. The Company expects to contribute a minimum of $2 million per year to the Global Water Treatment Trust Fund. These amounts are included in Funds for Asset Retirement Obligations on the Consolidated Balance Sheets.
In December 2024, the Office of Workers' Compensation Programs (the "OWCP") issued a final rule revising the regulations under the Black Lung Benefits Act related to self-insurance by coal mine operators. Under the new standard, self-insured coal mine operators are required to post additional security for the Black Lung benefit liabilities. The final rule requires a security amount equal to 100% of a self-insured operator's projected black lung liabilities. The rule became effective on January 13, 2025, and operators were required to remit the increased security amount within one year. The final rule, including any assessments, is subject to appeal. In February 2025, the Company received letters from the OWCP that additional guidance regarding the final rule will be provided at a future date.
The Company participates in the United Mine Workers of America (the "UMWA") Combined Benefit Fund and the UMWA 1992 Benefit Plan for which benefits are reflected in the Company's consolidated financial statements when paid. These benefit arrangements may result in additional liabilities that are not recognized on the Consolidated Balance Sheet at September 30, 2025. The various multi-employer benefit plans are discussed in Note 17 - Other Employee Benefit Plans in the Notes to the Consolidated Financial Statements in Item 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. The Company's total contributions under the Coal Industry Retiree Health Benefit Act of 1992 were $2 million for the nine months ended September 30, 2025 and 2024. The Company also uses a combination of surety bonds, corporate guarantees and letters of credit to secure its financial obligations for employee-related, environmental, performance and various other items that are not reflected on the Consolidated Balance Sheet at September 30, 2025. Management believes these items will expire without being funded. See Note 14 - Commitments and Contingent Liabilities in the Notes to the Consolidated Financial Statements included in Item 1 of this Quarterly Report on Form 10-Q for additional details of the various financial guarantees that have been issued by the Company.
Cash Flows (in millions)
Nine Months Ended September 30,
2025 2024 Change
Net Cash Provided by Operating Activities $ 198 $ 355 $ (157)
Net Cash Provided by (Used in) Investing Activities $ 132 $ (135) $ 266
Net Cash Used in Financing Activities $ (166) $ (94) $ (72)
Net cash provided by operating activities decreased $157 million in the period-to-period comparison, primarily due to the payment of non-recurring Merger-related expenditures in the nine months ended September 30, 2025.
Net cash provided by (used in) investing activities changed by $266 million in the period-to-period comparison, primarily due to cash acquired via the Merger, partially offset by the purchase of Arch's tax-exempt bonds. The Company liquidated its remaining U.S. Treasury securities during the nine months ended September 30, 2025, resulting in net proceeds of $75 million. Capital expenditures increased $66 million primarily due to expenditures at the operations acquired in the Merger, partially offset by reduced equipment-related expenditures and rebuilds at the PAMC and Itmann during the nine months ended September 30, 2025.
Net cash used in financing activities increased $72 million in the period-to-period comparison. Cash outflows related to share repurchases totaled $203 million in the nine months ended September 30, 2025, compared to $71 million in the nine months ended September 30, 2024. In connection with the Merger, the Company successfully amended its Revolving Credit Facility, refinanced its tax-exempt bonds and amended the legacy Arch Securitization Facility. Proceeds of $114 million were received in connection with the bond refinancing, and fees associated with these transactions amounted to $20 million. Additionally, dividend payments increased $13 million period-over-period.
Revolving Credit Facility
In November 2017, the Company entered into a revolving credit facility with PNC Bank, N.A. ("PNC") (the "Revolving Credit Facility"). The Revolving Credit Facility has been amended several times, the most recent of which occurred in January 2025 in connection with the Merger. The January 2025 amendment increased the available revolving commitments from $355 million to $600 million while extending the scheduled maturity date to April 30, 2029. Additionally, the Company reduced the applicable interest margin on its borrowings and letters of credit under the Revolving Credit Facility by 75 basis points.
Borrowings under the Revolving Credit Facility may be used for general corporate purposes, including working capital, capital expenditures and permitted acquisitions. Amounts repaid under the Revolving Credit Facility may be reborrowed, subject to satisfaction of the conditions to each credit extension. The Revolving Credit Facility provides that up to the full amount of the Revolving Credit Facility will be available for the issuance of letters of credit (the "Letters of Credit") by each lender under the Revolving Credit Facility, including Arch letters of credit that are deemed to be issued under the Revolving Credit Facility. The Company may increase the revolving credit commitments on the same terms or incur term "A" loans in an aggregate amount of up to $150 million.
Borrowings under the Revolving Credit Facility bear interest at a floating rate that is, at the Company's option, either (i) the applicable term Secured Overnight Financing Rate ("SOFR") rate plus a SOFR adjustment of 0.10% plus an applicable margin or (ii) an alternate base rate plus an applicable margin. The applicable margin for the Revolving Credit Facility ranges from 3.00% to 3.75% (for SOFR loans) and 2.00% to 2.75% (for alternate base rate loans), depending on the total net leverage ratio.
The Company's obligations under the Revolving Credit Facility are fully and unconditionally guaranteed by subsidiaries of the Company that own any portion of the Company's Pennsylvania Mining Complex, its marine terminal at the Port of Baltimore and specified coal reserves and, subject to certain customary exceptions, all other existing or future direct or indirect wholly-owned material restricted subsidiaries of the Company, including subsidiaries acquired pursuant to the Merger. The obligations under the Revolving Credit Facility are secured by, subject to certain exceptions (including a limitation of pledges of equity interests in certain subsidiaries and certain thresholds with respect to real property), a first-priority lien on the Company's and certain subsidiaries' significant assets.
The Revolving Credit Facility contains a number of customary affirmative covenants and a number of negative covenants, including (subject to certain exceptions) limitations on (among other things): indebtedness, liens, investments, acquisitions, asset dispositions, restricted payments, mergers, consolidations, divisions and other fundamental changes, transactions with affiliates and prepayments of junior indebtedness. The Revolving Credit Facility will require prepayment
of Revolving Credit Loans and/or Swing Loans if (x) Excess Balance Sheet Cash is greater than $125 million and (y) the sum of Revolving Credit Loans, Swing Loans and Letter of Credit Obligations (other than in respect of undrawn Letters of Credit) is greater than 25% of the Revolving Credit Commitments, in each case as of the last day of any calendar month.
The Revolving Credit Facility also includes financial covenants, including (i) a maximum first lien gross leverage ratio, (ii) a maximum total net leverage ratio, and (iii) a minimum interest coverage ratio. Under the Revolving Credit Facility, the maximum first lien gross leverage ratio is 1.50 to 1.00, the maximum total net leverage ratio is 2.50 to 1.00 and the minimum interest coverage ratio is 3.00 to 1.00. The Revolving Credit Facility contains customary events of default, including with respect to a failure to make payments when due, cross-default and cross-judgment default and certain bankruptcy and insolvency events.
The Company's first lien gross leverage ratio was 0.18 to 1.00 at September 30, 2025. The Company's total net leverage ratio was (0.04) to 1.00 at September 30, 2025. The Company's interest coverage ratio was 50.13 to 1.00 at September 30, 2025. The Company was in compliance with all covenants under the Revolving Credit Facility as of September 30, 2025.
At September 30, 2025, there were no borrowings outstanding under the Revolving Credit Facility and the facility is currently only used for providing letters of credit, with $79million of letters of credit outstanding, leaving $521 million of unused capacity. From time to time, the Company is required to post financial assurances to satisfy contractual and other requirements generated in the normal course of business. Some of these assurances are posted to comply with federal, state or other government agencies' statutes and regulations. The Company sometimes uses letters of credit to satisfy these requirements, and these letters of credit reduce the Company's borrowing facility capacity.
Receivables Financing Agreement
At September 30, 2025, certain U.S. subsidiaries of Core Natural Resources, Inc. were parties to a trade accounts receivable securitization facility with financial institutions for the sale on a continuous basis of eligible trade accounts receivable. On July 28, 2025, the Company and certain of its subsidiaries entered into (i) that certain Receivables Financing Agreement (the "Receivables Financing Agreement"), by and among Core Receivable Company, LLC, as borrower (the "Borrower"), Core Sales, LLC, as the initial servicer (the "Servicer"), PNC Bank, National Association ("PNC"), as administrative agent and LC bank, PNC Capital Markets LLC ("PNC CM"), as structuring agent, and the lenders from time to time party thereto; (ii) that certain Third Amended and Restated Sale and Contribution Agreement (the "Sale and Contribution Agreement"), by and among the Borrower, the Servicer and Arch, as transferor; (iii) that certain Third Amended and Restated Purchase and Sale Agreement (the "Purchase and Sale Agreement"), by and among Arch, the Servicer and the originators party thereto; and (iv) that certain Fifth Amended and Restated Performance Guaranty (the "Performance Guaranty" and, together with the Receivables Financing Agreement, the Sale and Contribution Agreement and the Purchase and Sale Agreement, the "Receivables Documents"). With entry into the Receivables Documents, legacy Arch's securitization facility was amended and restated in its entirety to, among other things, consolidate facilities and extend the maturity date to July 27, 2028, and legacy CONSOL's securitization facility was terminated effective July 28, 2025.
Pursuant to the Receivables Financing Agreement, Core Sales, LLC; Mingo Logan Coal LLC; Mountain Coal Company, L.L.C.; ICG Beckley, LLC; ICG Tygart Valley, LLC; Wolf Run Mining LLC; Thunder Basin Coal Company, L.L.C.; CONSOL Pennsylvania Coal Company LLC; CONSOL Marine Terminals LLC; and Itmann Mining Company LP, all wholly-owned subsidiaries of the Company, sell and/or contribute trade receivables to Core Receivable Company, LLC, a special purpose vehicle and wholly-owned subsidiary of the Company ("Core Receivable"). Core Receivable, in turn, pledges its interests in the receivables to PNC and/or Regions Bank, which either make loans or issue letters of credit on behalf of Core Receivable. The maximum amount of advances and letters of credit outstanding under the Receivables Financing Agreement may not exceed $250 million.
Loans under the Receivables Financing Agreement accrue interest at a reserve-adjusted market index rate equal to the applicable term SOFR rate plus ten basis points. Loans and letters of credit under the Receivables Financing Agreement also accrue a drawn fee and a letter of credit participation fee, respectively, of 2.00% per annum. In connection with the Receivables Financing Agreement, the Borrower paid certain structuring fees to PNC CM and pays other customary fees to the lenders, including a fee on unused commitments equal to 0.60% per annum.
The Receivables Documents contain various customary representations and warranties, covenants and default provisions that provide for the termination and acceleration of the commitments and loans under the Receivables Financing Agreement in certain circumstances including, but not limited to, failure to make payments when due, breach of representation, warranty or covenant, certain insolvency events or failure to maintain the security interest in the trade receivables, and defaults under other material indebtedness. The Company guarantees the performance of the obligations of Mingo Logan Coal LLC; Mountain Coal Company, L.L.C.; ICG Beckley, LLC; ICG Tygart Valley, LLC; Wolf Run
Mining LLC; Thunder Basin Coal Company, L.L.C.; CONSOL Pennsylvania Coal Company LLC; CONSOL Marine Terminals LLC; and Itmann Mining Company LP under the securitization, and will guarantee the obligations of any additional originators or successor servicer that may become party to the Receivables Financing Agreement. However, neither the Company nor its affiliates will guarantee collectability of receivables or the creditworthiness of obligors thereunder.
At September 30, 2025, eligible accounts receivable yielded $220 million of borrowing capacity. At September 30, 2025, the Receivables Financing Agreement had no outstanding borrowings and approximately $191 million of letters of credit outstanding, leaving $29 million of unused capacity. The Company has not derecognized any receivables due to its continued involvement in the collections efforts.
Series 2025 Bonds
On March 27, 2025, the Company borrowed the proceeds of tax-exempt bonds issued by (i) the Pennsylvania Economic Development Financing Authority ("PEDFA") in the aggregate principal amount of $98 million (the "PEDFA Bonds"), at a fixed rate of 5.45% for an initial term of ten years on an unsecured basis, pursuant to a Bond Purchase Agreement, dated March 19, 2025, by and among Jefferies LLC, as the representative acting on behalf of itself, KeyBanc Capital Markets Inc., PNC CM, Goldman Sachs & Co. LLC, B. Riley Securities, Inc. and TCBI Securities, Inc. (collectively, the "Underwriters"), PEDFA and the Company; (ii) the Maryland Economic Development Corporation ("MEDCO") in the aggregate principal amount of $103 million (the "MEDCO Bonds"), at a fixed rate of 5.00% for an initial term of ten years on an unsecured basis, pursuant to a Bond Purchase Agreement, dated March 19, 2025, by and among the Underwriters, MEDCO and the Company; and (iii) the West Virginia Economic Development Authority ("WVEDA") in the aggregate principal amount of $106 million (the "WVEDA Bonds" and together with the PEDFA Bonds and the MEDCO Bonds, the "Bonds"), at a fixed rate of 5.45% for an initial term of ten years on an unsecured basis, pursuant to a Bond Purchase Agreement, dated March 19, 2025, by and among the Underwriters, WVEDA and the Company.
The Company used (i) a portion of the proceeds of the PEDFA Bonds to finance and refinance the costs of acquisition, construction, improvement, installation and equipping of certain solid waste disposal facilities located at the Central Preparation Plant in West Finley, Pennsylvania in part by refunding in full PEDFA's outstanding $75 million Solid Waste Disposal Revenue Bonds, Series 2021A (CONSOL Energy Inc. Project), (ii) the proceeds from the MEDCO Bonds to refinance the costs of acquisition, construction, improvement, installation and equipping of certain improvements, modifications and additions to a coal transshipment terminal located in the Canton area of the Port of Baltimore by refunding in full MEDCO's outstanding $103 million Port Facilities Refunding Revenue Bonds (CNX Marine Terminals Inc. Port of Baltimore Facility) Series 2010 and (iii) a portion of the proceeds of the WVEDA Bonds to finance and refinance the costs of acquisition, construction, improvement, installation and equipping of certain solid waste disposal facilities relating to a longwall coal mining complex known as the Leer South Mine located in Barbour County, West Virginia in part by refunding in full WVEDA's outstanding $53 million Solid Waste Disposal Facility Revenue Bonds (Arch Resources Project), Series 2020 and $45 million Solid Waste Disposal Facility Revenue Bonds (Arch Resources Project), Series 2021.
The (i) PEDFA Bonds were issued pursuant to an indenture (the "PEDFA Indenture"), dated March 1, 2025, by and between PEDFA and Wilmington Trust, National Association, as trustee (the "Trustee"), and PEDFA made a loan of the proceeds of the PEDFA Bonds to the Company pursuant to a Loan Agreement, dated March 1, 2025 (the "PEDFA Loan Agreement"), between PEDFA and the Company; (ii) MEDCO Bonds were issued pursuant to an indenture (the "MEDCO Indenture"), dated March 1, 2025, by and between MEDCO and the Trustee, and MEDCO made a loan of the proceeds of the MEDCO Bonds to the Company pursuant to a Loan Agreement, dated March 1, 2025 (the "MEDCO Loan Agreement"), between MEDCO and the Company; and (iii) WVEDA Bonds were issued pursuant to an indenture (the "WVEDA Indenture" and together with the PEDFA Indenture and the MEDCO Indenture, the "Indentures"), dated March 1, 2025, by and between WVEDA and the Trustee, and WVEDA made a loan of the proceeds of the WVEDA Bonds to the Company pursuant to a Loan Agreement, dated as of March 1, 2025 (the "WVEDA Loan Agreement" and together with the PEDFA Loan Agreement and MEDCO Loan Agreement, the "Loan Agreements"), between WVEDA and the Company. Under the terms of the Loan Agreements, the Company agreed to make all payments of principal, interest and other amounts at any time due on the respective Bonds or under the respective Indenture.
Material Cash Requirements
The Company expects to make the following payments in the next 12 months:
•$106 million on its long-term debt and operating and finance lease obligations, including interest;
•$72 million on its employee-related long-term liabilities, including obligations that the Company has under multi-employer plans; and
•$84 million on its environmental obligations and $163 million on its other current liabilities.
The Company believes it will be able to satisfy these material requirements with cash generated from operations, cash on hand, borrowings under the Revolving Credit Facility and Receivables Financing Agreement and, if necessary, cash generated from its ability to issue equity or debt securities.
Debt
At September 30, 2025, the Company had total long-term debt and finance lease obligations of $425 million outstanding, including the current portion of $84 million. This long-term debt consisted of:
•An aggregate principal amount of $106 million of WVEDA Bonds, which were issued to finance a coal refuse disposal area at the Leer South mine, bear interest at 5.45% per annum for an initial term of ten years and mature in January 2055. Interest on the WVEDA Bonds is payable on April 1 and October 1 of each year.
•An aggregate principal amount of $103 million of MEDCO Bonds, which were issued to finance the Baltimore Marine Terminal, bear interest at 5.00% per annum for an initial term of ten years and mature in July 2048. Interest on the MEDCO Bonds is payable on February 1 and August 1 of each year.
•An aggregate principal amount of $98 million of PEDFA Bonds, which were issued to finance the ongoing expansion of the coal refuse disposal area at the Central Preparation Plant, bear interest at 5.45% per annum for an initial term of ten years and mature in January 2051. Interest on the PEDFA Bonds is payable on June 1 and December 1 of each year.
•An aggregate principal amount of $73 million of various equipment financing arrangements with a weighted-average interest rate of 7.56%.
•An aggregate principal amount of $34 million of finance leases with a weighted-average interest rate of 6.77%.
•Advanced royalty commitments of $6 million with a weighted-average interest rate of 8.10% per annum.
•An aggregate principal amount of $5 million of other debt arrangements.
At September 30, 2025, the Company had no borrowings outstanding and approximately $79 million of letters of credit outstanding under the $600 million Revolving Credit Facility. At September 30, 2025, the Company had no borrowings outstanding and approximately $191 million of letters of credit outstanding under the $250 million Receivables Financing Agreement.
Stock Repurchases
On February 18, 2025, the Company's Board of Directors approved a capital return framework that involves a mix of dividends and share repurchases. The repurchase program permits the repurchase, from time to time, of the Company's outstanding shares of common stock in an aggregate amount of up to $1 billion, subject to certain covenants in the Revolving Credit Facility and the agreements relating to the Series 2025 Bonds that limit the Company's ability to repurchase shares of its common stock.
During the nine months ended September 30, 2025, the Company repurchased and retired 2,824,033 shares of the Company's common stock at an average price of $71.74 per share.
Total Equity and Dividends
Total equity attributable to the Company was $3,779 million at September 30, 2025 and $1,568 million at December 31, 2024. See the Consolidated Statements of Stockholders' Equity in Item 1 of this Quarterly Report on Form 10-Q for additional details.
The declaration and payment of dividends by the Company is at the discretion of the Company's Board of Directors. The Revolving Credit Facility and the agreements relating to the Series 2025 Bonds include certain covenants limiting the Company's ability to declare and pay dividends.
On November 6, 2025, the Company announced a $0.10 per share dividend in an aggregate amount of approximately $5.1 million, payable on December 15, 2025 to all stockholders of record as of November 28, 2025.
Critical Accounting Estimates
The Company prepares its financial statements in accordance with accounting principles generally accepted in the U.S. The preparation of these financial statements requires management to make judgments, estimates and assumptions that affect the reported amount of assets, liabilities, revenues and expenses, as well as the disclosure of contingent assets and liabilities. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. There have been no material changes to the Company's critical accounting estimates from the Annual Report on Form 10-K for the year ended December 31, 2024, except as set forth below.
Business Combinations
The Company accounts for business combinations using the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed are recorded at their respective fair values at the date of acquisition. The determination of fair values of identifiable assets and liabilities requires estimates and the use of valuation techniques when fair value is not readily available and requires a significant amount of management judgment. Although the Company believes its estimates of fair values are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on the determination of fair value of the assets acquired in the Merger. During the measurement period (a period not to exceed 12 months from the closing date of the Merger), the Company may record adjustments to the assets acquired and liabilities assumed due to the use of preliminary information in its initial estimates. Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.
Forward-Looking Statements
Certain statements in this Quarterly Report on Form 10-Q are "forward-looking statements" within the meaning of the federal securities laws. With the exception of historical matters, the matters discussed in this Quarterly Report on Form 10-Q are forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that involve risks and uncertainties that could cause actual results and outcomes to differ materially from results expressed in or implied by our forward-looking statements. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The forward-looking statements may include projections and estimates concerning the timing and success of specific projects and our future production, revenues, income and capital spending. When we use the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "predict," "project," "should," "will," "would," or their negatives, or other similar expressions, the statements that include those words are usually forward-looking statements. When we describe strategy that involves risks or uncertainties, we are making forward-looking statements. The forward-looking statements in this Quarterly Report on Form 10-Q speak only as of the date of this Quarterly Report on Form 10-Q; we disclaim any obligation to update these statements unless required by securities law, and we caution you not to rely on them unduly. We have based these forward-looking statements on our current expectations and assumptions about future events. While our management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. These risks, contingencies and uncertainties relate to, among other matters, the following:
•risks related to the prior occurrence of combustion-related activity at Core's Leer South mine and the risk of future occurrences; the increase in combustion-related gases at Core's Leer South mine; and Core's ability to resume development work at Leer South with continuous miners and longwall development in accordance with its expected timing;
•the U.S. Government shutdown and our ability to resume operations at the Leer South mine;
•deterioration in economic conditions (including continued inflation) or changes in consumption patterns of our customers may decrease demand for our products, impair our ability to collect customer receivables and impair our ability to access capital;
•volatility and wide fluctuation in coal prices based upon a number of factors beyond our control;
•an extended decline in the prices we receive for our coal affecting our operating results and cash flows;
•significant downtime of our equipment or inability to obtain equipment, parts or raw materials;
•decreases in the availability of, or increases in the price of, commodities or capital equipment used in our coal mining operations;
•our reliance on major customers, our ability to collect payment from our customers and uncertainty in connection with our customer contracts;
•our inability to acquire additional coal reserves or resources that are economically recoverable;
•alternative steel production technologies that may reduce demand for our coal;
•the availability and reliability of transportation facilities and other systems that deliver our coal to market and fluctuations in transportation costs;
•a loss of our competitive position;
•foreign currency fluctuations that could adversely affect the competitiveness of our coal abroad;
•the risks related to the fact that a significant portion of our production is sold in international markets (and may grow) and our compliance with export control and anti-corruption laws;
•coal users switching to other fuels in order to comply with various environmental standards related to coal combustion emissions;
•the impact of current and future regulations to address climate change, the discharge, disposal and clean-up of hazardous substances and wastes and employee health and safety on our operating costs as well as on the market for coal;
•the risks inherent in coal operations, including being subject to unexpected disruptions caused by adverse geological conditions, equipment failure, delays in moving out longwall equipment, railroad derailments, security breaches or terroristic acts and other hazards, delays in the completion of significant construction or repair of equipment, fires, explosions, seismic activities, accidents and weather conditions;
•our inability to manage our operational footprint in response to changes in demand;
•failure to obtain or renew surety bonds or insurance coverages on acceptable terms;
•the effects of coordinating our operations with oil and natural gas drillers and distributors operating on our land;
•our inability to obtain financing for capital expenditures on satisfactory terms;
•the effects of our securities being excluded from certain investment funds as a result of ESG practices;
•the effects of global conflicts on commodity prices and supply chains;
•the effect of new or existing laws, regulations, tariffs, executive orders or other trade measures;
•our inability to find suitable joint venture partners or acquisition targets or integrating the operations of future acquisitions into our operations;
•obtaining, maintaining and renewing governmental permits and approvals for our coal operations;
•the effects of asset retirement obligations, employee-related long-term liabilities and certain other liabilities;
•uncertainties in estimating our economically recoverable coal reserves;
•defects in our chain of title for our undeveloped reserves or failure to acquire additional property to perfect our title to coal rights;
•the outcomes of various legal proceedings, including those that are more fully described herein;
•the risk of our debt agreements, our debt and changes in interest rates affecting our operating results and cash flows;
•information theft, data corruption, operational disruption and/or financial loss resulting from a terrorist attack or cyber incident;
•the potential failure to retain and attract qualified personnel of the Company;
•failure to maintain effective internal control over financial reporting;
•uncertainty with respect to the Company's common stock, potential stock price volatility and future dilution;
•uncertainty regarding the timing and value of any dividends we may declare;
•uncertainty as to whether we will repurchase shares of our common stock;
•inability of stockholders to bring legal action against us in any forum other than the state courts of Delaware;
•the risk that the businesses of the Company and Arch will not be integrated successfully;
•the risk that the anticipated benefits of the Merger may not be realized or may take longer to realize than expected;
•the risks related to new or existing tariffs and other trade measures; and
•other unforeseen factors.
The above list of factors is not exhaustive nor necessarily in order of importance. Additional information concerning factors that could cause actual results to differ materially from those in forward-looking statements include those discussed under "Risk Factors" elsewhere in this report and the other filings we make with the Securities and Exchange Commission ("SEC"). The Company disclaims any intention or obligation to update publicly any forward-looking statements, whether in response to new information, future events, or otherwise, except as required by applicable law.
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