Cola miner Alpha Metallurgical's Q2 EBITDA beats expectations

Overview

• Alpha reports Q2 net loss of $5.0 mln, improved from Q1 loss

• Adjusted EBITDA of $46.1 mln beats analyst expectations, per LSEG data

• Achieves best quarterly cost of coal sales performance since 2021

Outlook

• Alpha lowers 2025 cost of coal sales guidance to $101-$107 per ton

• Company reduces 2025 SG&A expense guidance to $48 mln-$54 mln

• Alpha raises full-year net cash interest income guidance to $6 mln-$12 mln

• Company increases 2025 idle operations expense guidance to $21 mln-$29 mln

Result Drivers

• COST REDUCTION - Alpha achieved significant cost reduction in coal sales, driven by labor and supply savings, per CEO Andy Eidson

• LIQUIDITY INCREASE - Alpha reported total liquidity of $557 mln as of June 30, attributed to improved cash flow and credit facility availability

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the iron & steel peer group is "buy."

• Wall Street's median 12-month price target for Alpha Metallurgical Resources Inc is $140.50, about 7.9% above its August 7 closing price of $129.45

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 7 three months ago

Press Release: ID:nPn22bkJWa