NACCO INDUSTRIES ANNOUNCES FIRST QUARTER 2025 RESULTS
PR Newswire
CLEVELAND, April 30, 2025
CLEVELAND, April 30, 2025 /PRNewswire/ --
Consolidated Q1 2025 Highlights:
-- Operating profit of $7.7 million increased from $4.8 million in Q1 2024 -- Income before taxes of $5.1 million decreased 8% from Q1 2024 -- Net income of $4.9 million increased 7.2% over Q1 2024 -- Diluted EPS of $0.66 versus $0.61 in Q1 2024 -- EBITDA of $12.8 million up 14% from Q1 2024
NACCO Industries$(R)$ $(NC)$ today announced the following consolidated results for the three months ended March 31, 2025.
Three Months Ended
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($ in thousands, except per share Fav (Unfav)
amounts) 3/31/2025 3/31/2024 % Change
--------- --------- ------------
Operating profit $7,682 $4,757 61.5 %
Other (income) expense, net $2,555 $(816) (413.1) %
Income before taxes $5,127 $5,573 (8.0) %
Income tax provision $227 $1,003 77.4 %
Net Income $4,900 $4,570 7.2 %
Diluted EPS $0.66 $0.61 8.2 %
Consolidated EBITDA* $12,829 $11,249 14.0 %
-------------------------------------- --------- --------- ------------
*Non-GAAP financial measures are defined and reconciled on page 8.
First Quarter 2025 Compared to First Quarter 2024
The significant improvement in consolidated operating profit was primarily due to a substantial increase in the Coal Mining segment operating profit and improved Mitigation Resources of North America(R) results. These improvements were partly offset by lower North American Mining segment results and an increase in Unallocated operating expenses, principally employee-related and outside services costs. A significant unfavorable change in other (income)/expense due to lower investment income and higher net interest expense offset the operating profit improvement, resulting in a moderate decrease in income before taxes.
The substantially lower first-quarter 2025 effective income tax rate drove the moderate increase in year-over-year net income.
Liquidity
At March 31, 2025, the Company had consolidated cash of $61.9 million and total debt of $95.8 million, with availability of $90.5 million under its revolving credit facility.
In the 2025 first quarter, the Company paid $1.7 million in dividends and repurchased approximately 22,200 shares of its Class A Common Stock at prevailing market prices for an aggregate purchase price of $0.7 million. As of March 31, 2025, the Company had $7.8 million remaining under its $20 million share repurchase program that expires at the end of 2025.
Detailed Discussion of 2025 First Quarter Compared to First Quarter 2024
Coal Mining Results
2025 2024
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Tons of coal delivered (in thousands)
Unconsolidated operations 5,616 5,480
Consolidated operations 591 455
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Total deliveries 6,207 5,935
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2025 2024
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(in thousands)
Revenues $ 19,239 $15,545
Earnings of unconsolidated operations $ 14,463 $12,007
Operating expenses(1) $ 7,341 $ 7,026
Operating profit (loss) $ 3,791 $ (417)
Segment Adjusted EBITDA(2) $ 5,809 $ 1,797
(1) Operating expenses consist of Selling, general and administrative
expenses, Amortization of intangible assets and (Gain) loss on sale of
assets.
(2) Segment Adjusted EBITDA is a non-GAAP measure and should not be considered
in isolation or as a substitute for GAAP. See non-GAAP explanation and the
related reconciliations to GAAP on page 9.
First-quarter 2025 revenues grew 23.8% due to an increase in tons delivered at Mississippi Lignite Mining Company. Prior year deliveries were lower as the power plant served by the mine operated with only one of its two boilers from mid-December 2023 through July 2024.
Coal Mining operating profit and Adjusted EBITDA increased significantly year-over-year mainly as a result of higher earnings of unconsolidated operations and improved operating results at Mississippi Lignite Mining Company. Earnings of unconsolidated operations increased mainly due to higher pricing at Falkirk after the expiration of temporary price concessions in June 2024 and a moderate increase in tons sold at Coteau. Improved operating efficiencies on higher tons sold primarily drove the increase in Mississippi Lignite Mining Company results.
North American Mining Results
2025 2024
-------------- --------------
(in thousands)
Tons delivered 12,853 15,173
2025 2024
-------------- --------------
(in thousands)
Revenues $ 31,526 $ 24,483
Operating profit $ 1,970 $ 2,355
Segment Adjusted EBITDA(1) $ 4,672 $ 4,611
(1) Segment Adjusted EBITDA is a non-GAAP measure and should not be considered
in isolation or as a substitute for GAAP. See non-GAAP explanation and the
related reconciliations to GAAP on page 9.
North American Mining(R) revenues grew 28.8% primarily due to an increase in reimbursed costs, which have an offsetting amount in cost of goods sold and therefore no impact on gross profit. Net of reimbursed costs, revenues increased modestly mainly as a result of an increase in parts sales largely offset by fewer tons delivered due to reduced customer requirements.
The increase in profits on parts sales was more than offset by the effect of lower delivery volumes and an increase in employee-related costs, which resulted in a decrease in the 2025 first-quarter operating profit.
Minerals Management Results
2025 2024
-------------- --------------
(in thousands)
Revenues $ 10,902 $ 10,401
Operating profit $ 7,907 $ 7,930
Segment Adjusted EBITDA(1) $ 9,815 $ 8,923
(1) Segment Adjusted EBITDA is a non-GAAP measure and should not be considered
in isolation or as a substitute for GAAP. See non-GAAP explanation and the
related reconciliations to GAAP on page 9.
Minerals Management revenues increased 4.8% primarily due to higher natural gas revenues, driven by higher natural gas prices, partly offset by a reduction in oil and coal royalties.
The improvement in Segment Adjusted EBITDA was primarily due to additional income from the increased equity investment in Eiger.
Outlook
NACCO's businesses provide critical inputs for electricity generation, construction and development, and the production of industrial minerals and chemicals. Increasing demand for electricity, on-shoring and current federal policies are creating favorable macroeconomic trends within these industries. We are confident in our trajectory and business prospects in 2025, and we continue to prepare for longer-term growth opportunities. Specifically for 2025, we expect to generate a moderate year-over-year increase in consolidated operating profit.
In 2025, the Coal Mining segment anticipates solid customer demand, with deliveries expected to increase modestly from 2024. We expect a more favorable near-term regulatory environment for the fossil fuel industry moving forward. These developments are expected to further support coal as an essential part of the energy mix in the United States for the foreseeable future.
The Coal Mining segment expects to benefit from the expiration of temporary price concessions at Falkirk and increased customer requirements at Coteau. In addition, Mississippi Lignite Mining Company continues to recover from inefficiencies experienced while its customer's Red Hills Power Plant operated on one of two generation units for more than half of 2024. With the power plant now anticipated to operate at a level consistent with historical averages, coal deliveries are expected to return to more normal levels, resulting in moderate cost efficiencies. However, an anticipated reduction in the 2025 contractually determined per ton sales price compared with 2024 is expected to offset these improvements, causing Mississippi Lignite Mining Company results to decline from prior year levels. An expected increase in operating expenses will contribute to an overall anticipated moderate year-over-year decrease in Coal Mining segment operating profit.
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