Peabody Energy Corporation (NYSE:BTU) Q1 2024 Earnings Conference Call May 2, 2024 11:00 AM ET

Company Participants

Karla Kimrey - Vice President of Investor Relations
Jim Grech - President & Chief Executive Officer
Mark Spurbeck - Chief Financial Officer
Malcolm Roberts - Chief Marketing Officer

Conference Call Participants

Lucas Pipes - B. Riley Securities
Nathan Martin - Benchmark Company
Katja Jancic - BMO Capital Markets

Operator

Good day, and welcome to the Peabody First Quarter 2024 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Karla Kimrey. Please go ahead.

Karla Kimrey

Good morning, and thanks for joining Peabody Energy Corp. for the first quarter of 2024. With me today are President and CEO, Jim Grech; CFO, Mark Spurbeck; and our Chief Marketing Officer, Malcolm Roberts.

Within the earnings release, you will find our statement on forward-looking information as well as a reconciliation of non-GAAP financial measures. We encourage you to consider the risk factors referenced there, along with our public filings with the SEC.

Now I'll turn the call over to Jim.

Jim Grech

Thanks Karla, and good morning everyone. First quarter operational results were highlighted by a number of challenges and successes. There were unforeseen production challenges in Australia that are now behind us, while thermal coal shipments in the US were impacted by unseasonably warm winter weather and low natural gas prices.

Within our Seaborne Met segment, Shoal Creek continues to exceed production expectations, although shipments have been hampered by the failure of the Demopolis lock. We continue to strategically invest in our portfolio through the development of Centurion, and completed the acquisition of the adjacent Wood Loads coal deposit, which extends the mine life to over 25 years. Before I expand on the markets, I want to thank our global employees for their continued focus and commitment to working safely and efficiently.

Now turning to the global coal markets. Seaborne Thermal coal markets traded within a tighter range for the first quarter. The normal winter and low natural gas prices have continued to weigh on demand for thermal coal, coupled with a steady supply from the East Coast of Australia, resulting in Newcastle coal trading within a range of $120 to $135 per ton.

Asian thermal coal imports are expected to remain robust, with China continuing to show increases in electricity demand with first quarter Seaborne Thermal coal imports estimated at a year-over-year increase of approximately 15%. Within the Seaborne Metallurgical coal market, coking coal prices declined during the quarter. Metallurgical coal demand was hampered by a thin steel margin globally, except for India, where robust economic output supported steelmaking profitability.