WARRIOR MET COAL, INC.

Previous wording

The following discussion and analysis provides a narrative of our results of operations and financial condition for the three and six months ended June 30, 2026 and June 30, 2025. You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing in this Form 10-Q and the audited financial statements for the year ended December 31, 2025 included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the "2025 Annual Report"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis. Please see“Forward-Looking Statements.”

Current wording

The following discussion and analysis provides a narrative of our results of operations and financial condition for the three and nine months ended September 30, 2026 and September 30, 2025. You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing in this Form 10-Q and the audited financial statements for the year ended December 31, 2025 included in our Annual Report on Form 10-K for the year ended December 31, 2025 (the "2025 Annual Report"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis. Please see“Forward-Looking Statements.”

Previous wording

As of December 31, 2025, based on a reserve report prepared by Marshall Miller & Associates, Inc. ("Marshall Miller"), our three operating underground mines had approximately 179.3 million metric tons of recoverable reserves and our Blue Creek mine contained 54.0 million metric tons of recoverable reserves. As a result of our high-quality coal, our Mine No. 7 steelmaking coal realized price has historically been in line with, or at a slight discount to, the Platts Premium Low Volatility ("LV") Free-On-Board Australian Index (the "S&P Platts Index"). Our Mine No. 4 and Blue Creek steelmaking coals are High Volatility A ("HVA") quality coal that typically trades at a discount to the price of coal from Mine No. 7. We primarily target the East Coast High Vol A index for sales of our Mine No. 4 and Blue Creek coals that are destined for the Atlantic Basin, whereas we target a variety of indices, including Platts Premium Low Vol and Platts Low Vol HCC for sales destined to the Pacific Basins. Our Blue Creek coal is also primarily sold into Asia and is sold on a cost and freight ("CFR") basis. Our steelmaking coal, mined from the Southern Appalachian portion of the Blue Creek coal seam, is characterized by low-to-high volatile matter, low sulfur, high fluidity, and high strength. These qualities make our coal ideally suited as a coking coal for the manufacture of steel.

Current wording

As of December 31, 2025, based on a reserve report prepared by Marshall Miller & Associates, Inc. ("Marshall Miller"), our three operating underground mines had approximately 179.3 million metric tons of recoverable reserves and our Blue Creek mine contained 54.0 million metric tons of recoverable resources. As a result of our high-quality coal, our Mine No. 7 steelmaking coal realized price has historically been in line with, or at a slight discount to, the Platts Premium Low Volatility ("LV") Free-On-Board Australian Index (the "S&P Platts Index"). Our Mine No. 4 and Blue Creek steelmaking coals are High Volatility A ("HVA") quality coal that typically trades at a discount to the price of coal from Mine No. 7. We primarily target the East Coast High Vol A index for sales of our Mine No. 4 and Blue Creek coals that are destined for the Atlantic Basin, whereas we target a variety of indices, including Platts Premium Low Vol and Platts Low Vol HCC for sales destined to the Pacific Basins. Our Blue Creek coal is also primarily sold into Asia and is sold on a cost and freight ("CFR") basis. Our steelmaking coal, mined from the Southern Appalachian portion of the Blue Creek coal seam, is characterized by low-to-high volatile matter, low sulfur, high fluidity, and high strength. These qualities make our coal ideally suited as a coking coal for the manufacture of steel.

Previous wording

In the first quarter of 2026, we completed the Blue Creek construction project. We invested approximately $71.3 million in the current year, brining total project spending to $1,028.1 million. Final project costs were fully in line with our capital guidance, and no material additional project capital expenditures are expected. With construction complete, Blue Creek is positioned to continue driving higher production, lower costs, and improved cash flow generation as the operation advances through its ramp-up and optimization phase.

Current wording

In the first quarter of 2026, we completed the Blue Creek construction project. We invested approximately $71.3 million in the current year, bringing total project spending to $1,028.1 million. Final project costs were fully in line with our capital guidance, and no material additional project capital expenditures are expected. With construction complete, Blue Creek is positioned to continue driving higher production, lower costs, and improved cash flow generation as the operation advances through its ramp-up and optimization phase.

Previous wording

Warrior BC bid approximately $32 million for the Mine No. 1 Lease and has submitted a payment for approximately $6.4 million, which is the first of five equal payments. Warrior Mining bid approximately $15 million for the Mine No. 4 Lease and has submitted a payment for approximately $3.0 million, which is the first of five equal payments. Successive installments are due each year on the anniversary of the Leases for the next four years. These future installments were recorded at a discount using our credit-adjusted risk-free rate and are presented in the Consolidated Balance Sheets as short and long-term federal coal lease obligations. As of June 30, 2026, the short-term and long-term obligations were $9.1 million and $24.4 million, respectively. As of December 31, 2025, the short-term and long-term obligations were $8.8 million and $23.7 million, respectively.

Current wording

Warrior BC bid approximately $32 million for the Mine No. 1 Lease and has submitted a payment for approximately $6.4 million, which is the first of five equal payments. Warrior Mining bid approximately $15 million for the Mine No. 4 Lease and has submitted a payment for approximately $3.0 million, which is the first of five equal payments. Successive installments are due each year on the anniversary of the Leases for the next four years. These future installments were recorded at a discount using our credit-adjusted risk-free rate and are presented in the Condensed Balance Sheets as short and long-term federal coal lease obligations. As of September 30, 2026, the short-term and long-term obligations were $9.2 million and $24.8 million, respectively. As of December 31, 2025, the short-term and long-term obligations were $8.8 million and $23.7 million, respectively.

Previous wording

On July 4, 2025, the One, Big, Beautiful Bill Act ("OBBBA") was enacted into law and includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The changes include, among other things, an update to IRC Section 250 Deduction: FDII to Foreign-Derived Deduction Eligible Income ("FDDEI"), which provides for, among other things, a permanent deduction of 33.34% of FDDEI, which reduces the statutory tax rate to 14% of such income. The OBBBA also classified met coal as a critical mineral eligible for the advanced manufacturing production tax credit under Section 45X (the "45X Credit") of the Internal Revenue Code. The 45X Credit for met coal provides for a credit of 2.5% of eligible production costs through 2029. Section 50202 of the OBBBA also temporarily decreases the royalty rate for coal leases on federal lands to not more than 7% through 2034. We recognized a benefit from the 45X Credit of $9.7 million and $18.0 million for the three and six months ended June 30, 2026, which is reflected as a reduction to cost of sales in the Condensed Statements of Operations and a corresponding income tax receivable included in prepaid expenses and other receivables in the Condensed Balance Sheets.

Current wording

On July 4, 2025, the One, Big, Beautiful Bill Act ("OBBBA") was enacted into law and includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The changes include, among other things, an update to IRC Section 250 Deduction: FDII to Foreign-Derived Deduction Eligible Income ("FDDEI"), which provides for, among other things, a permanent deduction of 33.34% of FDDEI, which reduces the statutory tax rate to 14% of such income. The OBBBA also classified met coal as a critical mineral eligible for the advanced manufacturing production tax credit under Section 45X (the "45X Credit") of the Internal Revenue Code. The 45X Credit for met coal provides for a credit of 2.5% of eligible production costs through 2029. Section 50202 of the OBBBA also temporarily decreases the royalty rate for coal leases on federal lands to not more than 7% through 2034. We recognized a benefit from the 45X Credit of $10.8 million and $28.9 million for the three and nine months ended September 30, 2026, which is reflected as a reduction to cost of sales in the Condensed Statements of Operations and a corresponding income tax receivable in the Condensed Balance Sheets.

Previous wording

We define Segment Adjusted EBITDA as net income (loss) adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative expenses, interest income, interest expense, income tax benefit (expense) and certain transactions or adjustments that the Chief Executive Officer, our Chief Operating Decision Maker, does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our consolidated financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

Current wording

We define Segment Adjusted EBITDA as net income adjusted for other revenues, cost of other revenues, depreciation and depletion, selling, general and administrative expenses, interest expense (income), income tax benefit (expense) and certain transactions or adjustments that the Chief Executive Officer, our Chief Operating Decision Maker, does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our consolidated financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

Previous wording

We evaluate our cash cost of sales on a cost per metric ton basis. Cash cost of sales is based on reported cost of sales and includes items such as freight, royalties, manpower, fuel and other similar production and sales cost items, and may be adjusted for other items that, pursuant to accounting principles generally accepted in the United States ("GAAP"), are classified in the Consolidated Statements of Operations as costs other than cost of sales, but relate directly to the costs incurred to produce steelmaking coal and sell it free-on-board at the Port of Mobile in Alabama. Our cash cost of sales per metric ton is calculated as cash cost of sales divided by the metric tons sold. Cash cost of sales is used as a supplemental financial measure by management and by external users of our consolidated financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

Current wording

We evaluate our cash cost of sales on a cost per metric ton basis. Cash cost of sales is based on reported cost of sales and includes items such as freight, royalties, manpower, fuel and other similar production and sales cost items, and may be adjusted for other items that, pursuant to accounting principles generally accepted in the United States ("GAAP"), are classified in the Condensed Statements of Operations as costs other than cost of sales, but relate directly to the costs incurred to produce steelmaking coal and sell it free-on-board at the Port of Mobile in Alabama. Our cash cost of sales per metric ton is calculated as cash cost of sales divided by the metric tons sold. Cash cost of sales is used as a supplemental financial measure by management and by external users of our consolidated financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

Previous wording

We define Adjusted EBITDA as net income (loss) before net interest expense (income), income tax expense (benefit), depreciation and depletion, non-cash asset retirement obligation accretion, non-cash stock compensation expense, other non-cash accretion, non-cash mark-to-market (gain) loss on gas hedges and business interruption expenses. Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our consolidated financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

Current wording

We define Adjusted EBITDA as net income before net interest expense (income), income tax expense (benefit), depreciation and depletion, non-cash asset retirement obligation accretion, non-cash stock compensation expense, other non-cash accretion and non-cash mark-to-market gain on gas hedges. Adjusted EBITDA is used as a supplemental financial measure by management and by external users of our consolidated financial statements, such as investors, industry analysts, lenders and ratings agencies, to assess:

Previous wording

We believe that the presentation of Adjusted EBITDA in this report provides information useful to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to Adjusted EBITDA is net income (loss). Adjusted EBITDA should not be considered an alternative to net income (loss) or any other measure of financial performance or liquidity presented in accordance with GAAP. Adjustments exclude some, but not all, items that affect net income and our presentation of Adjusted EBITDA may vary from that presented by other companies.

Current wording

We believe that the presentation of Adjusted EBITDA in this report provides information useful to investors in assessing our financial condition and results of operations. The GAAP measure most directly comparable to Adjusted EBITDA is net income. Adjusted EBITDA should not be considered an alternative to net income or any other measure of financial performance or liquidity presented in accordance with GAAP. Adjustments exclude some, but not all, items that affect net income and our presentation of Adjusted EBITDA may vary from that presented by other companies.

Previous wording

The following table presents a reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure, on a historical basis for each of the periods indicated.

Current wording

The following table presents a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP financial measure, on a historical basis for each of the periods indicated.

Previous wording

We produced 3.0 million metric tons of steelmaking coal for the three months ended June 30, 2026 compared to 2.1 million metric tons for the three months ended June 30, 2025, representing a 45.0% increase. The increased production was primarily driven by an increase in tons produced at the Blue Creek mine.

Current wording

We produced 2.8 million metric tons of steelmaking coal for the three months ended September 30, 2026 compared to 2.0 million metric tons for the three months ended September 30, 2025, representing a 35.8% increase. The increased production was primarily driven by an increase in tons produced at the Blue Creek mine.

Previous wording

Sales for the three months ended June 30, 2026 were $503.6 million compared to $288.5 million for the three months ended June 30, 2025. The $215.1 million increase in sales was primarily driven by a $186.6 million increase due to a 64.7% increase in steelmaking coal sales volume primarily due to Blue Creek combined with a $28.6 million increase related to a $8.60 per metric ton increase in the average net selling price per metric ton of our steelmaking coal. The average net selling price of our steelmaking coal increased $8.60 from $143.31 per metric ton in the second quarter of 2025 to $151.91 per metric ton in the second quarter of 2026.

Current wording

Sales for the three months ended September 30, 2026 were $501.0 million compared to $320.0 million for the three months ended September 30, 2025. The $181.1 million increase in sales was primarily driven by a $154.1 million increase due to a 48.2% increase in steelmaking coal sales volume primarily due to Blue Creek combined with a $27.0 million increase related to an $8.52 per metric ton increase in the average net selling price per metric ton of our steelmaking coal. The average net selling price of our steelmaking coal increased $8.52 from $149.73 per metric ton in the third quarter of 2025 to $158.25 per metric ton in the third quarter of 2026.

Previous wording

For the three months ended June 30, 2026, our geographic customer sales volume mix was 50% in Asia, 35% in Europe, 14% in South America and 1% in the United States. For the three months ended June 30, 2025, our geographic customer sales volume mix was 52% in Asia, 37% in Europe and 11% in South America. Our geographic customer mix typically varies each period based on the timing of customer orders and shipments.

Current wording

For the three months ended September 30, 2026, our geographic customer sales volume mix was 55% in Asia, 35% in Europe and 10% in South America. For the three months ended September 30, 2025, our geographic customer sales volume mix was 43% in Europe, 38% in Asia, 18% in South America and 1% in the United States. Our geographic customer mix typically varies each period based on the timing of customer orders and shipments.

Previous wording

Other revenues for the three months ended June 30, 2026 were $6.1 million compared to $9.0 million for the three months ended June 30, 2025. Other revenues are comprised of revenue derived from our natural gas operations, gains and losses on our natural gas hedges and earned royalty revenue. The $2.9 million decrease in other revenues was primarily due to the prior year comparable period including a gain on mark-to-market gas hedges of $1.8 million. The decrease was also due to a decrease in the Southern Louisiana natural gas price average per Million British Thermal Unit ("MMBtu") of 14% and a decrease in natural gas sales volumes of 1%.

Current wording

Other revenues for the three months ended September 30, 2026 were $6.9 million compared to $8.6 million for the three months ended September 30, 2025. Other revenues are comprised of revenue derived from our natural gas operations, gains and losses on our natural gas hedges and earned royalty revenue. The $1.7 million decrease in other revenues was primarily due to the prior year comparable period including a gain on mark-to-market gas hedges of $0.7 million.

Previous wording

Cost of sales was $340.0 million, or 66.7% of total revenues, for the three months ended June 30, 2026, compared to $226.4 million, or 76.1% of total revenues for the three months ended June 30, 2025. The $113.6 million increase was primarily driven by a $145.2 million increase due to a 1,302 thousand metric ton increase in steelmaking coal sales volume primarily driven by coal sales from the Blue Creek mine offset partially by a $31.6 million decrease due to a $9.54 per metric ton decrease in cash cost of sales per metric ton due to the sales mix of Blue Creek coal with its inherent lower cost structure, a benefit from the 45X Credit of $9.7 million, our disciplined approach to cost control and an increase in tons produced. For the three months ended June 30, 2026, cost of production represented 58% of cost of sales and transportation and royalties accounted for approximately 42% compared to cost of production of 67% and transportation and royalties of 33% for the three months ended June 30, 2025.

Current wording

Cost of sales was $368.5 million, or 72.6% of total revenues, for the three months ended September 30, 2026, compared to $239.5 million, or 72.9% of total revenues, for the three months ended September 30, 2025. The $129.0 million increase was primarily driven by a $114.2 million increase due to a 1,029 thousand metric ton increase in steelmaking coal sales volume primarily driven by coal sales from the Blue Creek mine and a $15.0 million increase due to a $4.73 per metric ton increase in cash cost of sales per metric ton reflecting lower production volumes at Mine No. 7, which resulted in production costs being absorbed over fewer tons, the effect of higher steelmaking coal prices on Warrior's variable cost structure (including transportation and royalties), and inflationary cost increases. These factors were partially offset by the lower-cost contribution from the Blue Creek mine and a benefit from the Section 45X credit. For the three months ended September 30, 2026, cost of production represented 63% of cost of sales and transportation and royalties accounted for approximately 37% compared to cost of production of 67% and transportation and royalties of 33% for the three months ended September 30, 2025.

Previous wording

Cost of other revenues was $7.0 million or 1.4% of total revenues, for the three months ended June 30, 2026, compared to $8.2 million, or 2.8% of total revenues for the three months ended June 30, 2025. The decrease was primarily driven by lower gas compression costs and a 1% decrease in gas sales volumes.

Current wording

Cost of other revenues was $6.8 million, or 1.3% of total revenues, for the three months ended September 30, 2026, compared to $7.6 million, or 2.3% of total revenues for the three months ended September 30, 2025. The decrease was primarily driven by a 9% decrease in gas sales volumes.

Previous wording

Depreciation and depletion expenses were $58.3 million, or 11.4% of total revenues, for the three months ended June 30, 2026, compared to $43.3 million, or 14.5% of total revenues for the three months ended June 30, 2025. The $15.0 million increase in depreciation and depletion is primarily driven by an increase in additional assets placed into service at Blue Creek combined with a 64.7% increase in steelmaking coal sales volume as depreciation and depletion is first capitalized into coal inventory and relieved when the tons are sold.

Current wording

Depreciation and depletion expenses were $68.1 million, or 13.4% of total revenues, for the three months ended September 30, 2026, compared to $43.6 million, or 13.3% of total revenues for the three months ended September 30, 2025. The $24.5 million increase in depreciation and depletion is primarily driven by a 48.2% increase in steelmaking coal sales volume as depreciation and depletion is first capitalized into coal inventory and relieved when the tons are sold combined with an increase in additional assets placed into service at Blue Creek.

Previous wording

Selling, general and administrative expenses were $9.8 million, or 1.9% of total revenues, for the three months ended June 30, 2026, compared to $11.9 million, or 4.0% of total revenues, for the three months ended June 30, 2025. The $2.1 million decrease in selling, general and administrative expenses for the period was primarily due to a gain of $2.4 million related to recoveries received in connection with the Walter Energy bankruptcy proceedings.

Current wording

Selling, general and administrative expenses were $13.7 million, or 2.7% of total revenues, for the three months ended September 30, 2026, compared to $17.2 million, or 5.2% of total revenues, for the three months ended September 30, 2025. The $3.5 million decrease in selling, general and administrative expenses for the period was primarily due to a decrease in employee-related expenses.

Previous wording

Interest expense was $5.5 million, or 1.1% of total revenues, for the three months ended June 30, 2026, compared to interest expense of $2.9 million, or 1.0% of total revenues, for the three months ended June 30, 2025. The $2.6 million increase was due to an increase in interest on additional financing leases and imputed interest on the federal coal lease obligations.

Current wording

Interest expense was $4.5 million, or 0.9% of total revenues, for the three months ended September 30, 2026, compared to interest expense of $2.3 million, or 0.7% of total revenues, for the three months ended September 30, 2025. The $2.2 million increase was due to capitalized interest no longer occurring with the finalization of the Blue Creek project and imputed interest on the federal coal lease obligations.

Previous wording

Interest income was $2.1 million, or 0.4% of total revenues for the three months ended June 30, 2026, compared to $5.1 million, or 1.7% of total revenues for the three months ended June 30, 2025. The $2.9 million decrease was primarily driven by a decrease in invested cash balances and lower rates of return earned on our investments.

Current wording

Interest income was $2.5 million, or 0.5% of total revenues for the three months ended September 30, 2026, compared to $4.4 million, or 1.3% of total revenues for the three months ended September 30, 2025. The $1.9 million decrease was primarily driven by a decrease in invested cash balances.

Previous wording

For the three months ended June 30, 2026, we recognized an income tax expense of $3.7 million compared to income tax expense of $4.3 million for the three months ended June 30, 2025. We estimated our annual effective tax rate and applied this effective tax rate to our year-to-date pretax income at the end of the interim reporting period. The $3.7 million income tax expense for the three months ended June 30, 2026, was driven by pre-tax income and depletion and Internal Revenue Code ("IRC") Section 250 Deduction: Foreign-Derived Deduction Eligible Income ("FDDEI") deductions. The prior year comparable period income tax expense was driven by a pre-tax income, depletion and FDII deductions.

Current wording

For the three months ended September 30, 2026, we recognized an income tax benefit of $0.4 million compared to an income tax benefit of $13.7 million for the three months ended September 30, 2025. We estimated our annual effective tax rate and applied this effective tax rate to our year-to-date pretax income at the end of the interim reporting period. The $0.4 million income tax benefit for the three months ended September 30, 2026, was driven by pre-tax income and depletion and Internal Revenue Code ("IRC") Section 250 Deduction: Foreign-Derived Deduction Eligible Income ("FDDEI") deductions. The prior year comparable period income tax benefit was driven by pre-tax income, depletion and FDII deductions.

Previous wording

The OBBBA was enacted on July 4, 2025, and updated the FDII to FDDEI, which provides for, among other things, a permanent deduction of 33.34% of FDDEI, which reduces the statutory tax rate to 14% of such income. The changes take effect for taxable years beginning after December 31, 2025.

Current wording

The OBBBA was enacted on July 4, 2025, and updated the FDII to FDDEI, which provides for, among other things, a permanent deduction of 33.34% of FDDEI, which reduces the statutory tax rate to 14% of such income. The changes took effect for taxable years beginning after December 31, 2025.

Previous wording

We produced 6.2 million metric tons of steelmaking coal for the six months ended June 30, 2026 compared to 4.1 million metric tons for the six months ended June 30, 2025, representing a 50.0% increase. The increased production was primarily driven by an increase in tons produced at the Blue Creek mine.

Current wording

We produced 9.0 million metric tons of steelmaking coal for the nine months ended September 30, 2026 compared to 6.2 million metric tons for the nine months ended September 30, 2025, representing a 45.3% increase. The increased production was primarily driven by an increase in tons produced at the Blue Creek mine.

Previous wording

Sales for the six months ended June 30, 2026 were $952.1 million compared to $583.4 million for the six months ended June 30, 2025. The $368.6 million or 63.2% increase in sales was primarily driven by a $301.0 million increase in sales due to a 51.6% or 2,055 thousand metric ton increase in steelmaking coal sales volume and a $67.6 million increase in sales related to a 7.6% or $11.20 per metric ton increase in the average net selling price per metric ton of steelmaking coal.

Current wording

Sales for the nine months ended September 30, 2026 were $1,453.1 million compared to $903.4 million for the nine months ended September 30, 2025. The $549.7 million or 60.8% increase in sales was primarily driven by a $455.2 million increase in sales due to a 50.4% or 3,084 thousand metric ton increase in steelmaking coal sales volume and a $94.5 million increase in sales related to a 7.0% or $10.27 per metric ton increase in the average net selling price per metric ton of steelmaking coal.

Previous wording

For the six months ended June 30, 2026, our geographic customer sales volume mix was 55% in Asia, 30% in Europe, 14% in South America and 1% in the United States. For the six months ended June 30, 2025, our geographic customer sales volume mix was 47% in Asia, 37% in Europe and 16% in South America. Our geographic customer mix typically varies each period based on the timing of customer orders and shipments.

Current wording

For the nine months ended September 30, 2026, our geographic customer sales volume mix was 55% in Asia, 32% in Europe, 12% in South America and 1% in the United States. For the nine months ended September 30, 2025, our geographic customer sales volume mix was 44% in Asia, 39% in Europe, 16% in South America and 1% in the United States. Our geographic customer mix typically varies each period based on the timing of customer orders and shipments.

Previous wording

Other revenues for the six months ended June 30, 2026 were $16.2 million compared to $14.0 million for the six months ended June 30, 2025. Other revenues are comprised of revenue derived from our natural gas operations, gains on sales and disposals of property, plant and equipment and land, changes in the fair value of our natural gas swap contracts, as well as earned royalty revenue. The $2.2 million increase in other revenues were due to an increase in the Southern Louisiana natural gas price average of 20% offset partially by a decrease in sales volume of 2% for the six months ended June 30, 2026.

Current wording

Other revenues for the nine months ended September 30, 2026 were $23.1 million compared to $22.7 million for the nine months ended September 30, 2025. Other revenues are comprised of revenue derived from our natural gas operations, gains on sales and disposals of property, plant and equipment and land, changes in the fair value of our natural gas swap contracts, as well as earned royalty revenue. The $0.5 million increase in other revenues was due to an increase in the Southern Louisiana natural gas price average of 17% offset partially by a decrease in sales volume of 5% for the nine months ended September 30, 2026.

Previous wording

Cost of sales (exclusive of items shown separately below) was $630.5 million, or 65.1%, of total revenues, for the six months ended June 30, 2026, compared to $472.2 million, or 79.0% of total revenues for the six months ended June 30, 2025. The $158.3 million increase was primarily driven by a $241.7 million increase due to a 51.6% or 2,055 thousand metric ton increase in steelmaking coal sales volume partially offset by a $83.4 million decrease due to a $13.82 per metric ton decrease in cash cost of sales per metric ton. The decrease in cash cost of sales per metric ton was due to the sales mix of Blue Creek coal and its inherent lower cost structure, a benefit from the 45X Credit of $18.0 million, our disciplined approach to cost control and an increase in tons produced. For the six months ended June 30, 2026, cost of production represented 59% of cost of sales and transportation and royalties accounted for approximately 41% compared to cost of production of 67% and transportation and royalties of 33% for the six months ended June 30, 2025.

Current wording

Cost of sales (exclusive of items shown separately below) was $999.0 million, or 67.7% of total revenues, for the nine months ended September 30, 2026, compared to $711.7 million, or 76.8% of total revenues for the nine months ended September 30, 2025. The $287.3 million increase was primarily driven by a $355.6 million increase due to a 50.4% or 3,084 thousand metric ton increase in steelmaking coal sales volume offset partially by a $68.2 million decrease due to a $7.41 per metric ton decrease in cash cost of sales per metric ton. The decrease in cash cost of sales per metric ton was due to the sales mix of Blue Creek coal and its inherent lower cost structure, a benefit from the Section 45X Credit of $28.9 million and an increase in tons produced. For the nine months ended September 30, 2026, cost of production represented 61% of cost of sales and transportation and royalties accounted for approximately 39% compared to cost of production of 67% and transportation and royalties of 33% for the nine months ended September 30, 2025.

Previous wording

Depreciation and depletion expenses were $110.6 million, or 11.4% of total revenues, for the six months ended June 30, 2026, compared to $88.5 million, or 14.8% of total revenues, for the six months ended June 30, 2025. The $22.0 million increase in depreciation and depletion expenses were primarily driven by additional assets placed into service at Blue Creek and a 51.6% or 2,055 thousand metric ton increase in steelmaking coal sales volume as depreciation and depletion is first capitalized into coal inventory and relieved when the tons are sold.

Current wording

Depreciation and depletion expenses were $178.7 million, or 12.1% of total revenues, for the nine months ended September 30, 2026, compared to $132.1 million, or 14.3% of total revenues, for the nine months ended September 30, 2025. The $46.5 million increase in depreciation and depletion expenses was primarily driven by a 50.4% or 3,084 thousand metric ton increase in steelmaking coal sales volume as depreciation and depletion is first capitalized into coal inventory and relieved when the tons are sold combined with additional assets placed into service at Blue Creek.

Previous wording

Selling, general and administrative expenses were $38.0 million, or 3.9% of total revenues, for the six months ended June 30, 2026, compared to $30.4 million, or 5.1% of total revenues, for the six months ended June 30, 2025. The $7.6 million increase in selling, general and administrative expenses for the period was primarily due to an increase in employee related expenses offset partially by a gain of $2.4 million related to recoveries received in connection with the Walter Energy bankruptcy proceedings.

Current wording

Selling, general and administrative expenses were $51.7 million, or 3.5% of total revenues, for the nine months ended September 30, 2026, compared to $47.6 million, or 5.1% of total revenues, for the nine months ended September 30, 2025. The $4.1 million increase in selling, general and administrative expenses for the period was primarily due to an increase in employee related expenses offset partially by a gain of $2.4 million related to recoveries received in connection with the Walter Energy bankruptcy proceedings.

Previous wording

Interest expense was $8.7 million, or 0.9% of total revenues, for the six months ended June 30, 2026, compared to $5.0 million, or 0.8% of total revenues, for the six months ended June 30, 2025. The $3.7 million increase was due to an increase in interest on additional financing leases and imputed interest on the federal coal lease obligations.

Current wording

Interest expense was $13.2 million, or 0.9% of total revenues, for the nine months ended September 30, 2026, compared to $7.3 million, or 0.8% of total revenues, for the nine months ended September 30, 2025. The $5.9 million increase was due to capitalized interest no longer occurring with the finalization of the Blue Creek project and imputed interest on the federal coal lease obligations.

Previous wording

Interest income was $4.7 million, or 0.5% of total revenues for the six months ended June 30, 2026, compared to $10.4 million, or 1.7%, of total revenues for the six months ended June 30, 2025. The $5.6 million decrease was primarily driven by a decrease in invested cash balances and lower rates of return earned on our investments.

Current wording

Interest income was $7.3 million, or 0.5% of total revenues for the nine months ended September 30, 2026, compared to $14.8 million, or 1.6% of total revenues, for the nine months ended September 30, 2025. The $7.5 million decrease was primarily driven by a decrease in invested cash balances.

Previous wording

We recognized income tax expense of $10.2 million and an income tax benefit of $1.7 million for the six months ended June 30, 2026 and June 30, 2025, respectively. We estimated our annual effective tax rate and applied this effective tax rate to our year-to-date pre-tax income at the end of the interim reporting period. The effective income tax rate for the six months ended June 30, 2026 varied from the statutory federal income tax rate of 21%, primarily due to pre-tax income and Internal Revenue Code ("IRC") Section 250 Deduction: Foreign-Derived Deduction Eligible Income ("FDDEI") deductions.

Current wording

We recognized income tax expense of $9.7 million and an income tax benefit of $15.5 million for the nine months ended September 30, 2026 and September 30, 2025, respectively. We estimated our annual effective tax rate and applied this effective tax rate to our year-to-date pre-tax income at the end of the interim reporting period. The effective income tax rate for the nine months ended September 30, 2026 varied from the statutory federal income tax rate of 21%, primarily due to pre-tax income and Internal Revenue Code ("IRC") Section 250 Deduction: Foreign-Derived Deduction Eligible Income ("FDDEI") deductions.

Previous wording

The OBBBA was enacted on July 4, 2025, and updated the FDII to FDDEI, which provides for, among other things, a permanent deduction of 33.34% of FDDEI, which reduces the statutory tax rate to 14% of such income. The changes take effect for taxable years beginning after December 31, 2025.

Current wording

The OBBBA was enacted on July 4, 2025, and updated the FDII to FDDEI, which provides for, among other things, a permanent deduction of 33.34% of FDDEI, which reduces the statutory tax rate to 14% of such income. The changes took effect for taxable years beginning after December 31, 2025.

Previous wording

Going forward, we plan to use cash to fund debt service payments on our Notes, the Amended ABL Facility and our other indebtedness, to fund operating activities, working capital, capital expenditures, our reclamation obligations, our finance lease obligations, our black lung obligations, our federal coal lease obligations, professional fees and other non-recurring transaction expenses and strategic investments, stock repurchases, and, if declared, to pay our quarterly and/or special dividends. Our ability to fund our capital needs going forward will depend on our ongoing ability to generate cash from operations and borrowing availability under the

Current wording

Going forward, we plan to use cash to fund debt service payments on our Notes, the Amended ABL Facility and our other indebtedness, to fund operating activities, working capital, capital expenditures, our reclamation obligations, our finance lease obligations, our black lung obligations, our federal coal lease obligations, professional fees and other non-recurring transaction expenses and strategic investments, stock repurchases, and, if declared, to pay our quarterly and/or special dividends. Our ability to fund our capital needs going forward will depend on our ongoing ability to generate cash from operations and borrowing availability under the Amended ABL Facility, and, in the case of any future strategic investments, capital needs or special dividends financed partially or wholly with debt financing and our ability to access the capital markets to raise additional capital.

Previous wording

Our total liquidity as of June 30, 2026 was $452.9 million, consisting of cash and cash equivalents of $302.3 million, short-term investments of $10.1 million, which is net of $10.1 million posted as collateral and $140.5 million available under our Amended ABL Facility. As of June 30, 2026, no loans were outstanding under the Amended ABL Facility and there were $2.5 million of letters of credit issued and outstanding under the Amended ABL Facility.

Current wording

Our total liquidity as of September 30, 2026 was $577.6 million, consisting of cash and cash equivalents of $437.1 million and $140.5 million available under our Amended ABL Facility. As of September 30, 2026, no loans were outstanding under the Amended ABL Facility and there were $2.5 million of letters of credit issued and outstanding under the Amended ABL Facility.

Previous wording

We assumed all of the black lung liabilities of Walter Energy and its U.S. subsidiaries. We are self-insured for these black lung liabilities and have posted $18.6 million in surety bonds and $10.1 million of collateral recognized as short-term investments in addition to maintaining a black lung trust of $0.7 million that was acquired from Walter Energy. We received a letter from the Division of Coal Mine Workers' Compensation ("DCWMC") on February 21, 2020, under its new process for self-insurance renewals, which would require us to increase the amount of collateral posted to $39.8 million, but we appealed such increase. We received another letter from the DCWMC on December 8, 2021 requesting additional information to support our appeal of the collateral requested by the DOL. On February 9, 2022, the DCWMC held a conference call with representatives from the Company related to our appeal. On July 12, 2022, we received a decision on our appeal from the DCWMC lowering the amount of collateral required to be posted from $39.8 million to $28.0 million. We appealed this decision.

Current wording

We assumed all of the black lung liabilities of Walter Energy and its U.S. subsidiaries. We are self-insured for these black lung liabilities and have posted $18.6 million in surety bonds and $10.2 million of collateral recognized as short-term investments in addition to maintaining a black lung trust of $0.6 million that was acquired from Walter Energy. We received a letter from the Division of Coal Mine Workers' Compensation ("DCMWC") on February 21, 2020, under its new process for self-insurance renewals, which would require us to increase the amount of collateral posted to $39.8 million, but we appealed such increase. We received another letter from the DCMWC on December 8, 2021 requesting additional information to support our appeal of the collateral requested by the DOL. On February 9, 2022, the DCMWC held a conference call with representatives from the Company related to our appeal. On July 12, 2022, we received a decision on our appeal from the DCMWC lowering the amount of collateral required to be posted from $39.8 million to $28.0 million. We appealed this decision.

Previous wording

On January 19, 2023, the DOL proposed revisions to regulations under the Black Lung Benefits Act governing authorization of self-insurers, which was then subsequently revised as part of the final rules published on December 12, 2024, which became effective on January 13, 2025 (the "2025 Final Regulations"). The 2025 Final Regulations required, among other requirements, all self-insured operators to post security of at least 100 percent of their projected black lung liabilities. On January 14, 2025, we received a letter from the DCMWC outlining the new procedures and application process for authorizing operators to self-insure under the new regulations. The letter outlined authorization form requirements and provided a 60-day period for the submission of the required documents. Subsequently, on February 20, 2025, we received another letter from the DCMWC stating that the 60-day deadline to provide information was no longer applicable and no information was required to be submitted at this time. DCWMC further stated that additional guidance would be provided in due course after consultation with the new DOL leadership.

Current wording

On January 19, 2023, the DOL proposed revisions to regulations under the Black Lung Benefits Act governing authorization of self-insurers, which was then subsequently revised as part of the final rules published on December 12, 2024, which became effective on January 13, 2025 (the "2025 Final Regulations"). The 2025 Final Regulations required, among other requirements, all self-insured operators to post security of at least 100 percent of their projected black lung liabilities. On January 14, 2025, we received a letter from the DCMWC outlining the new procedures and application process for authorizing operators to self-insure under the new regulations. The letter outlined authorization form requirements and provided a 60-day period for the submission of the required documents. Subsequently, on February 20, 2025, we received another letter from the DCMWC stating that the 60-day deadline to provide information was no longer applicable and no information was required to be submitted at this time. DCMWC further stated that additional guidance would be provided in due course after consultation with the new DOL leadership.

Previous wording

On July 30, 2026, the DOL published a notice of proposed rulemaking that would amend the 2025 Final Regulations. Among other changes, the proposal would replace the current requirement that self-insured operators post security equal to 100% of projected black lung liabilities with a risk-based framework and would permit qualifying operators to phase in required security over a three-year period. The proposed rule remains subject to public comment and may be modified before adoption. The Company is evaluating the proposal and cannot currently predict the ultimate outcome of the rulemaking or reasonably estimate its effect, if any, on the Company's financial position, results of operations or liquidity.

Current wording

On July 30, 2026, the DOL published a notice of proposed rulemaking that would amend the 2025 Final Regulations. Among other changes, the proposal would replace the current requirement that self-insured operators post security equal to 100% of projected black lung liabilities with a risk-based framework and would permit qualifying operators to phase in required security over a three-year period. The proposed rule may be modified before adoption. The Company is evaluating the proposal and cannot currently predict the ultimate outcome of the rulemaking or reasonably estimate its effect, if any, on the Company's financial position, results of operations or liquidity.

Previous wording

We believe that our future cash flows from operations, together with cash on our balance sheet and proceeds from the borrowings under our Amended ABL Facility, will provide adequate resources to fund our debt service payments, asset retirement obligations, finance lease obligations, federal coal lease obligations, black lung obligations and planned operating and capital expenditure needs for at least the next twelve months and beyond. However, we will continue to assess our liquidity needs in light of the current weakness in steelmaking coal prices.

Current wording

We believe that our future cash flows from operations, together with cash on our balance sheet and proceeds from the borrowings under our Amended ABL Facility, will provide adequate resources to fund our debt service payments, asset retirement obligations, finance lease obligations, federal coal lease obligations, black lung obligations and planned operating and capital expenditure needs for at least the next twelve months and beyond.

Previous wording

Cash and cash equivalent balances were $302.3 million and $300.0 million at June 30, 2026 and December 31, 2025, respectively.

Current wording

Cash and cash equivalent balances were $437.1 million and $300.0 million at September 30, 2026 and December 31, 2025, respectively.