CONSOL Energy Inc. (NYSE: CEIX) shares surged over 7% on November 6, 2024, riding on the back of an exceptional third-quarter performance that saw the coal producer achieve record production levels, lowest cash costs in recent quarters, and a robust contracted position for 2025.

The company's Pennsylvania Mining Complex (PMC) achieved its highest-ever third-quarter sales and production tonnage of 7.2 million tons, up 18% year-over-year. This stellar operational performance, coupled with reduced contractor and purchase servicing costs, enabled CONSOL Energy to report its lowest cash cost of coal sold per ton since Q1 2023, at $35.85.

The strong production and cost efficiency translated into impressive financial results, with the company posting a net income of $96 million or $3.22 per diluted share, and an adjusted EBITDA of $179 million. CONSOL Energy's free cash flow for the quarter stood at a robust $122 million, surpassing the free cash flow generated in the first half of 2024.

Looking ahead, CONSOL Energy has secured contracts for approximately 18 million tons in 2025, driven by robust demand in the crossover metallurgical coal market, particularly in China and Southeast Asia. The company's high-quality product has proven attractive for blending with Australian coking coal, positioning it well for future growth opportunities.

Despite challenges such as equipment delivery delays at the Itmann complex and weak domestic demand due to low natural gas prices and inventory overhang, CONSOL Energy remains optimistic about its ability to achieve full operational ramp-up once the remaining section equipment arrives. Additionally, the company is making progress on its proposed merger with Arch Resources, having obtained necessary regulatory approvals and focusing on securing shareholder approval.