SunCoke Energy Inc. SXC posted a third-quarter 2015 adjusted loss of 6 cents per share. The Zacks Consensus Estimate was earnings of 3 cents.
Operating loss excluded impairment of equity method investment in Visa SunCoke of 30 cents per share.
Quarterly Highlights
SunCoke Energy’s total revenues declined 10.6% to $336.9 million from $377 million a year ago due to the pass-through of lower coal prices at the Domestic Coke segment as well as lower sales volume. Revenues narrowly missed the Zacks Consensus Estimate of $338 million.
Total costs and operating expenses fell 10.6% to $313.8 million. The decrease was attributable to lower cost of products sold and operating expenses, and asset impairment of $16.4 million related to the Coal Mining segment.
SunCoke Energy reported an operating income of $23.1 million, down 10.8% from $25.9 million a year ago.
The company reported total adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) of $50.2 million, down 21.8% from the year-ago level. The decline was primarily due to the operating challenges at Indiana Harbor.
SunCoke Energy’s interest expenses increased 22.7% to $14.6 million from $11.9 million last year.
Segment Highlights
Domestic Coke: Adjusted EBITDA declined 22.8% to $55.9 million primarily due to underperformance at the Indiana Harbor facility and idling of Haverhill Chemicals LLC, one of the company’s steam supply partners. Domestic coke-production volume in the reported quarter was 1,049 thousand tons, down 3.8% year over year, while coke sales volume was 1,043 thousand tons, down 2.9%.
Coal Logistics: Adjusted EBITDA escalated 173.7% to $10.4 million from the year-ago level owing to the Convent Marine Terminal contribution.
Brazil Coke: Adjusted EBITDA remained flat at $3.4 million from last year. Brazilian coke production rose 4.2% to 449 thousand tons.
India Coke: Adjusted EBITDA loss remained flat at $0.8 million. Coke sales volume declined 7.8% to 71 thousand tons.
Coal Mining: Adjusted EBITDA loss was $4.9 million, wider than a loss of $2.9 million in the third quarter of 2014.
Financial Position
Cash and cash equivalents were $103.2 million as of Sep 30, 2015 compared with $139.0 million as of Dec 31, 2014. Long-term debt was $998 million as of Sep 30, 2015 compared with $633.5 million as of Dec 31, 2014.
In the nine months ended Sep 30, 2015, SunCoke Energy’s net cash from operating activities increased 42% to $83 million from $58.4 million in the prior-year period. The company’s capital expenditure declined 54% to $49.3 million from $107.2 million a year ago.
Business Update
SunCoke Energy has disposed its 23% stake in the Granite City cokemaking operations to SunCoke Energy Partners, L.P. SXCP for a consideration of $67 million.
2015 Guidance
For 2015, SunCoke Energy expects consolidated adjusted EBITDA in the range of $180–$190 million.
The company expects domestic coke production in the range of 4.1–4.2 million tons.
Capital expenditure is estimated to be $75–$80 million.
Cash from operations is expected in the range of $125–$145 million.
Cash taxes are estimated to be $8–$9 million.
Upcoming Releases
Alliance Holdings GP, L.P. AHGP is slated to report third quarter earnings on Oct 27, 2015. The Zacks Consensus Estimate is $ 1.12.
Cloud Peak Energy Inc. CLD is slated to report third quarter earnings on Oct 27, 2015. The Zacks Consensus Estimate is a loss of $0.13.
Zacks Rank
SunCoke Energy currently carries a Zacks Rank #3 (Hold).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment