SunCoke Energy Q3 2026 Earnings: Adjusted EBITDA Rises as Revenue Holds Flat

SunCoke Energy (NYSE: SXC) reported Q3 2026 revenue of $485.9 million, down 0.2% from $487.0 million a year earlier, while diluted EPS slipped to $0.25 from $0.26. Adjusted EBITDA increased 30.1% to $76.9 million, supported by Industrial Services growth, improved coke sales mix, and favorable coal-to-coke yields.

Core Earnings Data

Revenue was essentially unchanged as lower Domestic Coke sales were offset by growth in Industrial Services. Operating income rose to $40.6 million from $13.4 million, but net income remained flat because the prior-year quarter included capital investment tax credits. Non-GAAP adjusted EBITDA increased to $76.9 million, lifting adjusted EBITDA as a percentage of revenue to approximately 15.8% from 12.1%.

Adjusted EBITDA is a non-GAAP measure and excludes items including property insurance recoveries and certain site closure, restructuring, and transaction-related costs.

Business and Segment Performance

Domestic Coke generated higher adjusted EBITDA despite lower revenue and sales volume, reflecting a more favorable mix of contract and spot coke sales and improved coal-to-coke yields. Industrial Services recorded higher revenue and adjusted EBITDA because of an additional month of Phoenix results and increased terminal handling volumes. Together, these trends explain why consolidated revenue was nearly flat while adjusted EBITDA expanded materially.

Domestic Coke revenue fell because the Haverhill I facility shutdown reduced blast coke volume and lower coal prices were passed through under long-term take-or-pay agreements. Capacity utilization nevertheless increased to 99% from 97% at the remaining Domestic Coke operations.

Corporate and Other adjusted EBITDA was a $6.3 million expense, compared with a $3.1 million expense a year earlier, primarily because of higher employee-related costs.

Profitability, Cash Flow, and Balance Sheet

SunCoke disclosed cash flow data for the nine months ended September 30 rather than the quarter alone. Nine-month operating cash flow increased to $140.3 million from $52.5 million, while capital expenditures rose to $53.8 million from $43.0 million. The simple difference between operating cash flow and capital expenditures was approximately $86.5 million, compared with $9.5 million in the prior-year period.

Cash and cash equivalents declined to $57.6 million from $88.7 million at the end of 2025. This occurred despite stronger operating cash flow because financing activities used $127.8 million, including approximately $86.0 million of net revolving-facility repayments and $31.0 million of dividends. Long-term debt decreased by $84.7 million to $600.8 million.

Working capital remained an important factor in cash conversion. Receivables used $99.9 million of cash during the nine-month period, while lower inventories provided $38.1 million. SunCoke also declared a quarterly dividend of $0.12 per share, payable December 1, 2026.

A $27.1 Million Tax Swing Offset the Operating Profit Gain

Income before taxes increased to $32.1 million from $5.0 million, an improvement of $27.1 million. However, the tax line moved from an $18.8 million benefit in Q3 2025 to an $8.3 million expense in Q3 2026—an approximately $27.1 million adverse swing that management attributed primarily to the absence of capital investment tax credits recorded in the prior-year quarter.

That tax change roughly offset the entire increase in pretax income, leaving GAAP net income unchanged at $23.8 million. Net income attributable to SXC and diluted EPS declined slightly because income allocated to noncontrolling interests increased to $2.0 million from $1.6 million.

2026 Guidance

Management now expects full-year consolidated adjusted EBITDA to modestly exceed the previous range’s $265 million high end. The operating cash flow, capital expenditure, net income, tax receipt, and coke volume outlooks were also included in the company’s revised 2026 guidance, although prior comparable ranges were not provided for those measures.

SunCoke also reached an October 2026 settlement with Algoma Steel related to its 2025 claim. The release did not disclose the settlement’s financial terms, so its effect cannot be quantified from the available information.

Recent Insider Transactions

The supplied insider dataset reported no open-market purchases or sales during its latest six-month measurement window and total insider holdings of approximately 947,200 shares. The latest clearly identified transactions in the two-year record included a stock award, several purchases, and one derivative-security conversion; all were reported as direct holdings.

These transactions are factual disclosures and do not, on their own, establish insiders’ views of SunCoke’s outlook or valuation.

Risks Investors Should Watch

• Lower coke volume: The Haverhill I shutdown reduced blast coke sales and contributed to an 8.0% decline in Domestic Coke volume. Further volume pressure could offset the benefits of higher adjusted EBITDA per ton.
• Dependence on favorable mix and yields: Domestic Coke’s EBITDA improvement was driven partly by contract and spot sales mix and favorable coal-to-coke yields. The release did not indicate how long these benefits may continue.
• Fourth-quarter cash conversion: With $140.3 million of operating cash flow through September, SunCoke would need approximately $129.7 million to $144.7 million in Q4 to reach its $270 million to $285 million full-year guidance. Receivables were already a substantial year-to-date cash use.
• Higher corporate costs: Corporate and Other adjusted EBITDA expense more than doubled to $6.3 million because of higher employee-related costs, partially diluting gains from the operating segments.
• Reported revenue pressure from coal-price pass-throughs: Lower coal prices reduced Domestic Coke revenue under take-or-pay agreements, meaning reported sales may remain pressured even when underlying operating profitability is more resilient.

Summary

SunCoke’s Q3 2026 results featured nearly flat revenue but substantially higher operating income and adjusted EBITDA, driven by Industrial Services growth, better coke sales mix, and favorable production yields. A prior-year tax benefit prevented those operating gains from producing comparable GAAP earnings growth. The main points to monitor are delivery of the above-$265 million adjusted EBITDA outlook, the large fourth-quarter cash flow requirement, and whether improved Domestic Coke economics can continue despite lower volume.