Segment Information

9 Months Ended

Sep. 30, 2025

Note 12. Segment Information

The Company generates revenue primarily through the production of steelmaking coal for sale to the steel industry. The Company also generates ancillary revenues from the sale of natural gas extracted as a byproduct from the underground coal mines and royalty revenues from leased properties.

Following the commencement of revenue-generating activities for the Blue Creek mine during the three months ended June 30, 2025, the manner in which the Company's chief operating decision maker (“CODM”), the Chief Executive Officer, measures financial performance and allocates resources changed. The Company reassessed its segment reporting and has determined that it continues to have one reportable segment identified as Mining which consists of: Mine No. 4, Mine No. 7 and the Blue Creek mine.

The Company has determined that its natural gas and royalty businesses did not meet the criteria in ASC 280 to be considered as a reportable segment. Therefore, the Company has included their results in an “all other” category as a reconciling item to consolidated amounts. The Company recast prior period information related to the change in segments, however, there were no revenues or cost of revenues associated with the Blue Creek mine.

The Company does not allocate all of its assets, or its depreciation and depletion expense, selling, general and administrative expenses, transactions costs, interest income (expense), and income tax expense (benefit) by segment.

The following tables include reconciliations of segment information to consolidated amounts (in thousands):


	For the three months ended September 30,				For the nine months ended September 30,
	2025		2024		2025		2024
Revenues
Mining	$	319,969	$	319,944	$	903,393	$	1,208,366
All other		8,620		7,776		22,662		19,389
Total revenues	$	328,589	$	327,720	$	926,055	$	1,227,755

Segment profit
Revenue	$	319,969	$	319,944	$	903,393	$	1,208,366
Cash cost of sales (exclusive of depreciation and depletion)(1)		237,216		229,744		705,748		773,605
Other segment items(2)		2,309		1,854		5,924		4,884
Segment profit	$	80,444	$	88,346	$	191,721	$	429,877

Transportation and royalties
Mining	$	79,347	$	78,029	$	237,031	$	293,909
All other		—		—		—		—
Total transportation and royalties	$	79,347	$	78,029	$	237,031	$	293,909

Depreciation and depletion
Mining	$	41,492	$	34,415	$	125,497	$	108,496
All other		2,102		2,227		6,629		6,319
Total depreciation and depletion	$	43,594	$	36,642	$	132,126	$	114,815

Assets
Mining	$	2,540,831	$	2,433,606	$	2,540,831	$	2,433,606
All other		141,965		146,842		141,965		146,842
Total assets	$	2,682,796	$	2,580,448	$	2,682,796	$	2,580,448

Capital expenditures
Mining	$	81,353	$	114,196	$	222,599	$	321,108
All other		1,225		1,682		3,455		5,434
Total capital expenditures	$	82,578	$	115,878	$	226,054	$	326,542

(1)

The significant expense category and amounts align with the segment-level information that is regularly reviewed by the CODM, inclusive of transportation and royalties and exclusive of depreciation and depletion.

(2)

Other segment items include non-cash charges to cost of sales (exclusive of depreciation and depletion) of asset retirement obligation accretion and valuation adjustments and stock compensation expense.

For the three and nine months ended September 30, 2025 and 2024, the Company's Mining segment had revenues comprising greater than 10% from the following customers:


	For the three months ended September 30,				For the nine months ended September 30,
Customers(1)	2025		2024		2025		2024
Customer A	$	51,234	$	—	$	105,117	$	—
Customer B		38,837		—		—		—
Customer C		—		53,445		—		190,138
Customer D		—		45,322		—		190,811
Customer E		—		35,245		—		182,075
Customer F		—		—		—		178,087

(1)

Customers with a zero did not trip the 10% quantitative threshold for that period.

The Company evaluates the performance of its segment based on Segment Adjusted EBITDA, which is defined as net income adjusted for other revenues; cost of other revenues; depreciation and depletion expense; selling, general and administrative expenses; interest income, net; income tax benefit (expense) and certain transactions or adjustments that the CODM does not consider for the purposes of making decisions to allocate resources among segments or assessing segment performance. Segment Adjusted EBITDA should not be considered as an alternative to cost of sales under GAAP and may not be comparable to other similarly titled measures used by other companies. Below is a reconciliation of Segment Adjusted EBITDA to net income (loss), which is its most directly comparable financial measure calculated and presented in accordance with GAAP (in thousands):


	For the three months ended September 30,						For the nine months ended September 30,
	2025			2024			2025			2024
Segment Adjusted EBITDA	$	80,444		$	88,346		$	191,721		$	429,877
Other revenues		8,620			7,776			22,662			19,389
Cost of other revenues		(7,546	)		(8,854	)		(23,629	)		(29,491	)
Depreciation and depletion		(43,594	)		(36,642	)		(132,126	)		(114,815	)
Selling, general and administrative		(17,200	)		(11,510	)		(47,566	)		(45,861	)
Interest income, net		2,128			7,257			7,508			22,616
Income tax benefit (expense)		13,746			(4,607	)		15,466			(32,248	)
Net income	$	36,598		$	41,766		$	34,036		$	249,467

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

WARRIOR MET COAL, INC. 10-Q