Warrior Met Coal 2025 Q2 Earnings Significant Earnings Drop
Generado por agente de IAAinvest Earnings Report Digest
jueves, 7 de agosto de 2025, 12:07 pm ET2 min de lectura
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Warrior Met CoalHCC-- reported earnings that fell well below prior-year levels, driven by a weaker coal market and declining prices. The company issued updated guidance reflecting a challenging outlook for the remainder of 2025. The earnings report highlights a significant drop in both net income and revenue compared to the prior year, with a 91.9% decline in EPS and a 92.1% decrease in net income.
Revenue
Warrior Met Coal's total revenue in 2025 Q2 fell by 26.1% to $288.49 million, with the mining segment accounting for the entirety of the $288.49 million in revenue. This represents a notable decline from the $390.42 million in revenue reported during the same period in 2024. The company's overall revenue of $297.52 million for the quarter reflects a sharp drop from the $396.52 million recorded in the prior-year period.
Earnings/Net Income
The company's earnings per share (EPS) dropped dramatically to $0.11 in 2025 Q2, a 91.9% decrease from $1.35 in the same period in 2024. Net income also plummeted by 92.1%, declining to $5.61 million in 2025 Q2 from $70.71 million in 2024 Q2. This steep decline in profitability underscores the challenges faced by Warrior Met CoalHCC-- in a difficult market environment.
Price Action
Despite the earnings shortfall, Warrior Met Coal's stock saw a positive response in the short term. The stock price edged up 1.26% during the latest trading day, surged 8.21% over the past full trading week, and climbed 11.53% month-to-date. The positive price movement suggests market optimism or strategic buying amid the earnings report.
Post Earnings Price Action Review
A trading strategy of buying HCCHCC-- when earnings beat and holding for 30 days delivered impressive results. The strategy generated a 361.65% return, outperforming the benchmark return of 86.19%. The strategy's excess return of 275.46% and a compound annual growth rate (CAGR) of 36.12% indicate strong performance. Notably, the strategy experienced no maximum drawdown, a Sharpe ratio of 0.72, and a volatility of 49.99%, highlighting effective risk management and substantial returns.
CEO Commentary
Walt Scheller, CEO of Warrior Met Coal, emphasized the company's strong operational performance and cost discipline. He highlighted the early commercial sales from Blue Creek, the successful startup of longwall operations, and the company's focus on maintaining positive cash margins despite market conditions. Scheller also outlined the challenges posed by global steelmaking headwinds, including excess Chinese exports and tariff uncertainties, while expressing cautious optimism about the company's future.
Guidance
The company updated its full-year 2025 guidance to reflect the challenging market conditions. Warrior Met Coal anticipates coal sales in the range of 8.8-9.5 million short tons and coal production of 8.3-9.1 million short tons. The company expects a cash cost of sales (free-on-board port) between $110-$120 per short ton. Capital expenditures for sustaining existing mines are projected to be $90-$100 million, while the Blue Creek project will see capital expenditures of $225-$250 million. The company also expects mine development costs for Blue Creek to be between $85-$100 million, depreciation and depletion costs between $185-$210 million, and SG&A expenses between $65-$75 million. Interest expense is projected to range from $10-$15 million, and interest income is expected to be between $15-$20 million.
Additional News
Warrior Met Coal announced a regular quarterly cash dividend of $0.08 per share, set to be distributed on August 15, 2025, to stockholders of record as of August 8, 2025. The company emphasized its commitment to disciplined capital allocation and the strategic development of the Blue Creek project. The Blue Creek longwall operations are expected to begin ahead of schedule in early Q1 2026, with a focus on cost control and operational efficiency to sustain cash flow. The company also highlighted its ability to generate strong cash margins and positive operating cash flows despite market conditions. Warrior Met Coal's updated outlook reflects its strategic positioning and operational efficiency amid volatile market conditions.
Revenue
Warrior Met Coal's total revenue in 2025 Q2 fell by 26.1% to $288.49 million, with the mining segment accounting for the entirety of the $288.49 million in revenue. This represents a notable decline from the $390.42 million in revenue reported during the same period in 2024. The company's overall revenue of $297.52 million for the quarter reflects a sharp drop from the $396.52 million recorded in the prior-year period.
Earnings/Net Income
The company's earnings per share (EPS) dropped dramatically to $0.11 in 2025 Q2, a 91.9% decrease from $1.35 in the same period in 2024. Net income also plummeted by 92.1%, declining to $5.61 million in 2025 Q2 from $70.71 million in 2024 Q2. This steep decline in profitability underscores the challenges faced by Warrior Met CoalHCC-- in a difficult market environment.
Price Action
Despite the earnings shortfall, Warrior Met Coal's stock saw a positive response in the short term. The stock price edged up 1.26% during the latest trading day, surged 8.21% over the past full trading week, and climbed 11.53% month-to-date. The positive price movement suggests market optimism or strategic buying amid the earnings report.
Post Earnings Price Action Review
A trading strategy of buying HCCHCC-- when earnings beat and holding for 30 days delivered impressive results. The strategy generated a 361.65% return, outperforming the benchmark return of 86.19%. The strategy's excess return of 275.46% and a compound annual growth rate (CAGR) of 36.12% indicate strong performance. Notably, the strategy experienced no maximum drawdown, a Sharpe ratio of 0.72, and a volatility of 49.99%, highlighting effective risk management and substantial returns.
CEO Commentary
Walt Scheller, CEO of Warrior Met Coal, emphasized the company's strong operational performance and cost discipline. He highlighted the early commercial sales from Blue Creek, the successful startup of longwall operations, and the company's focus on maintaining positive cash margins despite market conditions. Scheller also outlined the challenges posed by global steelmaking headwinds, including excess Chinese exports and tariff uncertainties, while expressing cautious optimism about the company's future.
Guidance
The company updated its full-year 2025 guidance to reflect the challenging market conditions. Warrior Met Coal anticipates coal sales in the range of 8.8-9.5 million short tons and coal production of 8.3-9.1 million short tons. The company expects a cash cost of sales (free-on-board port) between $110-$120 per short ton. Capital expenditures for sustaining existing mines are projected to be $90-$100 million, while the Blue Creek project will see capital expenditures of $225-$250 million. The company also expects mine development costs for Blue Creek to be between $85-$100 million, depreciation and depletion costs between $185-$210 million, and SG&A expenses between $65-$75 million. Interest expense is projected to range from $10-$15 million, and interest income is expected to be between $15-$20 million.
Additional News
Warrior Met Coal announced a regular quarterly cash dividend of $0.08 per share, set to be distributed on August 15, 2025, to stockholders of record as of August 8, 2025. The company emphasized its commitment to disciplined capital allocation and the strategic development of the Blue Creek project. The Blue Creek longwall operations are expected to begin ahead of schedule in early Q1 2026, with a focus on cost control and operational efficiency to sustain cash flow. The company also highlighted its ability to generate strong cash margins and positive operating cash flows despite market conditions. Warrior Met Coal's updated outlook reflects its strategic positioning and operational efficiency amid volatile market conditions.
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