管理層發言
Lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, please press star 1 on your telephone keypad. If you would like to withdraw your question, simply press star 1 again. We'll now turn the conference over to Sharon Doyle, Investor Relations Manager. Please go ahead.
Thank you. Good morning and thank you for joining us this morning to discuss Suncoke Energy's second quarter 2026 results. With me today are Catherine Gates, President and Chief Executive Officer, and Shantanu Agrawal, Senior Vice President and Chief Financial Officer. This conference call is being webcast live on the investor relations section of our website and a replay will be available later. Following management's prepared remarks, we will open the call for Q&A. If we do not get to your questions on the call today, please feel free to reach out to our investor relations team. Before I turn things over to Catherine, let me remind you that the various remarks we make on today's call regarding future expectations constitute forward-looking statements. The cautionary language regarding forward-looking statements in our SEC filings applies to the remarks we make today. These documents are available on our website, as are our reconciliations to non-GAAP financial measures discussed on today's call. With that, I'll turn it over to Catherine. Thanks, Sharon.
Thanks, Sharon. Good morning, and thank you for joining us on today's call. This morning, we announced Suncoke Energy's second quarter results. I want to share a few highlights before turning it over to Shantanu to discuss the results in detail. We're very pleased with our second quarter results with strong consolidated adjusted EBITDA of $69.6 million. Our industrial services segment delivered the highest adjusted EBITDA since the acquisition of Phoenix, with substantially higher handling volumes at our terminals as compared to the prior year period. Our domestic coke segment benefited from favorable coal-to-coke yields, and the Middletown turbine was returned to service with power production resuming in May. Earlier today, we also announced a quarterly dividend of $0.12 per share, payable to shareholders on September 2, 2026. This is our 28th consecutive quarterly dividend. While the dividend is evaluated on a quarterly basis by our board, we expect the dividend to continue as part of our well-balanced capital allocation.
As previously discussed in our first quarter earnings call, we are running at full capacity and sold out for the full year. We expect continued strong operating performance for both business segments, and with a solid outlook through the second half of the year, we are increasing our full-year 2026 consolidated adjusted EBITDA guidance range to $250 million to $265 million. With that, I'll turn it over to Shantanu to review our second quarter earnings.
Thanks, Catherine. Turning to slide four. Net income attributable to Suncoke was $0.15 per share in the second quarter of 2026, up $0.13 versus the prior year period. The increase was primarily driven by the addition of Phoenix results and higher terminal handling volumes. Consolidated adjusted EBITDA for the second quarter of 2026 was $69.6 million compared to $43.6 million in the prior year period. The increase in adjusted EBITDA was primarily driven by the addition of Phoenix, higher terminal handling volumes, and favorable coal-to-coke yields, partially offset by lower coke sales volumes due to the Haverhill One shutdown and higher employee expense accruals driven by the company's strong financial performance. Moving to slide five to discuss our domestic coke business performance in detail. Second quarter domestic coke adjusted EBITDA was $42.5 million and coke sales volumes were 878,000 tons compared to $40.5 million and 943,000 tons in the prior year period.
The increase in adjusted EBITDA was primarily driven by favorable coal-to-coke yields and improved operating conditions, partially offset by lower coke sales volumes due to the Haverhill One shutdown. We are pleased with the improvement in our coke operations during the second quarter and with the return of power production at Middletown earlier than anticipated. We expect this strong operational performance to continue throughout the second half of the year and are increasing our full-year domestic coke adjusted EBITDA guidance range to $172 million to $178 million. Now moving on to slide six to discuss our industrial services results. Our industrial services segment generated $34.4 million of adjusted EBITDA in the second quarter of 2026, compared to $7.7 million in the prior year period. The increase in adjusted EBITDA was primarily driven by the addition of Phoenix results and higher terminal handling volumes.
Second quarter total terminals handling volumes were 6.7 million tons and steel customer volumes serviced were 5.8 million tons. We are increasing our full-year 2026 industrial services adjusted EBITDA guidance range to $110 million to $115 million, driven by a continued solid IEPs outlook for the second half of the year. Now, turning to slide seven to discuss our liquidity position for Q2. Suncoke ended the second quarter with a cash balance of $42.7 million and revolver availability of $164.5 million, representing ample liquidity of $207.2 million. Cash used in operating activities was $27.2 million and was negatively impacted by the timing of approximately $65 million of cash receipts at the quarter end, which were subsequently received in July. We expect operating cash flow to normalize over the remainder of the year and are increasing our full-year operating cash flow guidance to $240 million to $260 million.
During the quarter, we used $6.5 million for debt pay down, spent $15.9 million on capital expenditures, and paid $10.2 million in dividends at the rate of $0.12 per share. Suncoke has a strong track record of generating steady free cash flow, and we expect the trend to continue throughout the year. As Catherine mentioned earlier, we intend to continue utilizing our free cash flow to pay down debt, as well as to reward our long-term shareholders via dividends, which are reviewed and approved on a quarterly basis by our board of directors.
With that, I'll turn it back over to Catherine. Thanks, Shantanu. Wrapping up on slide eight. As always, safety is our first priority and our team remains committed to maintaining strong safety and environmental performance throughout the year. Robust safety and environmental standards set Suncoke apart and are central to our reliable delivery of high-quality coke and industrial services. We continue to be confident in our operations for 2026 with our profitable long-term coke business underpinned by the three pillars of Indiana Harbor, Middletown, and Jewel Foundry, which have consistently delivered excellent performance and results. With our Haverhill Two and Granite City coke making contracts in place and all spot glass and foundry coke sales finalized—we are sold out for the full year. We also maintain a positive outlook for our industrial services segment. 2026 will benefit from a full year of Phoenix adjusted EBITDA, as well as solid market conditions at our terminals.
As always, we take a balanced yet opportunistic approach to capital allocation. Our focus will remain on utilizing our free cash flow to support our capital allocation priorities, including paying down our revolver balance. We also plan to continue returning capital via the quarterly dividend as approved by our board, which has always been well received by our long-term shareholders. We continuously evaluate the capital needs of the business, our capital structure, and the need to reward our shareholders, and will make capital allocation decisions accordingly. We're committed to maximizing value for all of our stakeholders, which means operating and investing in our assets in the best and most efficient way possible. We will continue to focus on maintaining the strength of our core businesses, as well as assessing new growth opportunities across all areas of our business. Overall, we see the strong fundamentals of our business and expect our 2026 results to be reflective of that. We are confident that we'll be able to deliver full-year consolidated adjusted EBITDA within our revised guidance range of $250 million to $265 million.
分析師問答
Let's go ahead and open up the call for Q&A. If you have a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you wish to remove yourself from the queue, simply press star 1 again. Your first question comes from the line of Henry Hurl of B. Riley Securities. Your line is open.
Thank you, operator, and good morning, everyone. Just to start off, on the domestic coke side this year, adjusted EBITDA per ton was roughly $48.4, which is still slightly below your revised higher full-year guidance of $51 to $52. Could you help us and walk through the drivers to achieve this higher yield per ton in the second half of the year?
Thanks, Henry. Yes, there are a couple of things in there. First, the Middletown turbine came back online in the latter part of May, so we still did not have the full benefit of Middletown turbine power generation for the full quarter. You are going to see that benefit in the third and fourth quarters as we get the full turbine power generation from Middletown. The other piece which is also included in the second half of the year is the insurance recovery proceeds for the lost generation while the turbine was offline during the first half of the year. That recovery is built into our guidance for the second half.
Got it. Thanks, Shantanu. And then I believe your terminal handling volumes increased almost 20% quarter over quarter. What was kind of the main driver or drivers of that significant step up?
So, you know, this was really an extraordinary quarter for the terminals. We saw a shift from the end of last year and into the beginning of this year where domestic coal was relatively higher versus international coal. I think supply chain concerns and energy concerns tied to geopolitical developments, including the war in the Middle East, have driven some of these prices higher. When prices move higher, we see more volume come through as buyers react to market dynamics. Those factors all converged to create a very strong second quarter for us.
Understood. Thank you, Catherine, for that color. I think in your prepared remarks you said terminal volumes are expected to see strong performance in the second half. Do you mean further growth from Q2 levels or more of a normalization and remaining at those Q2 levels?
Very good question. We see the second half as being strong, but I would describe it as strong rather than extraordinary. The second quarter was unusual in that several things converged across all of our terminals to give us those very high volumes. We feel very good about the second half, but I would expect volumes to normalize to what I would consider our normal, strong results for the second half, which is reflected in the guidance we are giving for industrial services on a full-year basis.
Got it. Understood. I'll turn it over. Thanks, guys, and continued best of luck.
Thank you. Your next question comes from the line of Nathan Martin of The Benchmark Company. Your line is open.
Thanks, operator. Good morning, everyone. Congrats on a strong quarter. Maybe just digging in a little bit more on that last question. You did raise industrial services segment guidance by what looks like about $18 million or so at the midpoint, but it actually implies, I guess, an average of about $26 million a quarter in the back half. So am I thinking about that correctly, just trying to reconcile the implied half-over-half decline, or is there some conservatism built in? I think you guys had previously guided to terminal volumes of 24 million tons and Phoenix volumes of 22 million tons. Is that still what you're seeing for that segment or any other thoughts there would be great?
Yes, thanks, Nate. That's a great question. A couple of things. In Q2 we saw a significant amount of volumes come through the terminals. If you look at Q1, it was also pretty strong with 5.6 million tons, and we did 6.7 million tons in Q2. I would say the run rate for the second half is somewhere in the middle of those, more toward the Q1 level. The other piece which really impacted and helped us in Q2 was some extraordinary slag sales that we did on the Phoenix side of the business, which helped drive the number in Q2. These are more seasonal and timing-related items: you handle slag in one quarter and then sell it into the market. That helped in Q2 and should normalize out in Q3 and Q4. That's why the full-year guidance of $110 million to $115 million makes sense from that perspective.
Okay, that's some good color, Shantanu. I appreciate that. With Phoenix, are you guys still thinking that $60 million-ish run rate is a good way to think about that, or have you been able to institute some cost savings initiatives or higher sales that might see some upside there?
With respect to the synergies we expected to realize, we discussed previously the $5 million to $10 million of synergies and we have already achieved that this year. We have a good portion of the synergies this year, and we would expect to see full synergies in 2026. Operationally, we have applied the same level of discipline, reliability, and rigor at Phoenix that we bring to our other terminals. That operational excellence, coupled with how the mills have been performing, has driven stronger performance this year. So thinking about our original $60 million as a baseline when we announced the acquisition of Phoenix is reasonable, but you're seeing stronger performance this year due to operations execution and market conditions. On the price index question, we changed the price index last year to FOB New Orleans. We did see a favorable impact from that index this quarter—primarily two months out of the three months this quarter—and we expect to see some benefit in Q3 as well, although the index and the relative benefits can change quickly with market shifts between domestic and international pricing.
Okay, got it, Shantanu. And then I just wanted to come back to the coke side: you mentioned that insurance proceeds from Middletown are partly driving some of the higher expected adjusted EBITDA per ton in the back half. How much are those proceeds and how should we think about how that flows through?
So, Nate, we are not laying out a precise insurance amount because it's tied to a single plant's generation and timing. But if you think about it, what we said earlier was that the impact of the turbine outage and weather impacts on Indiana Harbor and our other units was roughly $10 million in Q1. We also did not have power for several months, so you can extrapolate and model the lost generation and associated recoveries. That gives you a way to think about the scale of the insurance proceeds built into the second-half guidance. The $10 million is illustrative of the magnitude of the impacts in Q1, and those effects continued into a portion of Q2 as well.
Okay. Got it. All right. I'll leave it there. Appreciate the time, everybody. Best of luck in the second half.
With no further questions, I will now turn the call back over to CEO and President Catherine Gates for closing remarks.
Thank you all for joining us this morning and for your continued interest in Suncoke Energy. Let's continue to work safely today and every day. This concludes today's conference call. You may now disconnect.