Warrior Met Coal saw strong demand for steel-making coal from
Asia in the third quarter, boosting sales by 51%.
On its
third quarter:
The
U.S.-based producer of steel-making coal sold 2.3 million tons of coal, up from
1.5 million tons in the comparable period a year ago.
"The
51% increase in sales volume was driven by continued improved performance by
our rail transportation provider and the McDuffie Terminal, which enabled
Warrior to export more product and draw down excess inventory," the
company said.
"In
addition, higher production was primarily due to both Mine No. 4 and Mine No. 7
operating at higher capacity levels in this quarter as a result of additional
employees returning from the labor strike."
Chief
Executive Walt Scheller said, "As evidenced by our sales volumes, demand
for shipments from our global contracted steel-making customers as well as for
spot cargoes from Asia was strong.
"We
continued to see improved performance from our transportation partners and at
the McDuffie Terminal, which allowed us to ship more volume and reduce our
excess inventory," Scheller said.
"Warrior
has had a larger ratio of spot volume this quarter, mainly due to the end of
the strike and the quality change at Mine 4. Normally, we sell most of our spot
volumes into our natural markets of Europe and South America, but both regions
have offered a limited number of spot transactions this year.
"As
such, Warrior has directed the majority of its spot business to China, India
and other South Asian countries. However, our average net selling price was
impacted by the freight differentials associated with the Pacific Basin, and in
particular China, additionally impacted by the negative arb in relation to the
PLB FOB Australia.
"We
believe the rapid and steep rise in the PLV Index price is based upon strong
demand from China and India, supply disruptions out of Australia, specifically
for premium hard coking coals, and a severe lack of liquidity supporting the
inadequate index system."
Warrior
produced almost 2 million tons of steel-making coal, up from 1.6 million tons
in the comparable period a year ago.
On its
outlook:
Warrior
maintained its full-year guidance of 6.8 million to 7.4 million tons of coal
and sales of 7.1 million to 7.7 million tons.