SUNCOKE ENERGY PARTNERS LP LISLE, Ill., Jan. 26, 2017 /PRNewswire/ -- SunCoke Energy, Inc. (NYSE: SXC) today reported fourth quarter 2016 net income attributable to SXC of $17.0 million, or $0.26 per share, down $2.0 million versus the prior year period. Fourth quarter Consolidated Adjusted EBITDA was $77.3 million, up $22.3 million versus the prior year period primarily due to the recognition of CMT deferred revenue.
Full-year 2016 net income attributable to SXC was $14.4 million, or $0.22 per share, representing a $36.4 million increase versus the same prior year period. The Company delivered full-year 2016 Consolidated Adjusted EBITDA of $217.0 million, which was in line with its full-year guidance, and $31.6 million higher than full-year 2015.
"Fourth quarter and full-year results were in line with expectations, and again illustrate the ability for our coke and coal logistics segments to consistently generate stable results," said Fritz Henderson, President, Chairman and Chief Executive Officer of SunCoke Energy, Inc. "In 2016, we set out to manage through the challenging market conditions that our customers faced while continuing to focus on de-levering our balance sheet and achieving our financial objectives. I am pleased that we have successfully delivered against these initiatives."
Looking forward, the Company expects 2017 Consolidated Adjusted EBITDA to be between $220 million and $235 million. This outlook reflects higher Coal Logistics volumes and lower Corporate spending, partially offset by the impact of the continued oven work at the Company's Indiana Harbor facility.
Henderson continued, "As we move into 2017, we are focused on executing against our 2017 objectives and delivering value to SunCoke shareholders."
2016 CONSOLIDATED RESULTS(1)
Three Months Ended Years Ended
December 31, December 31,
(Dollars in 2016 2015 Increase/ 2016 2015 Increase/
millions) (Decrease) (Decrease)
----------- ---- ---- ---------- ---- ---- ----------
Total
revenues $325.6 $353.6 $(28.0) $1,223.3 $1,362.7 $(139.4)
Net income
(loss)
attributable
to SXC $17.0 $19.0 $(2.0) $14.4 $(22.0) $36.4
Adjusted
EBITDA(2) $77.3 $55.0 $22.3 $217.0 $185.4 $31.6
(1) The current and prior year
periods are not comparable due
to the divestiture of our Coal
Mining business in April 2016
and the contribution of Convent
Marine Terminal, which was
acquired on August 12, 2015.
(2) See definition of Adjusted
EBITDA and reconciliation
elsewhere in this release.
Total revenues from operations were $325.6 million and $1,223.3 million in fourth quarter and full-year 2016, respectively, a decrease of $28.0 million and $139.4 million, respectively, compared with the same prior year periods. These decreases in revenue primarily reflect the pass-through of lower coal prices and lower sales volumes in our Domestic Coke segment. The full-year impact was partly offset by the full-year contribution from the Convent Marine Terminal ("CMT") versus the prior year period.
Fourth quarter 2016 net income attributable to SXC was $17.0 million, or $0.26 per share, down from net income of $19.0 million, or $0.30 per share, in the same prior year period. The prior year results include $8.9 million of gains on debt extinguishment and lower income taxes driven primarily by a deduction related to the liquidation of a coal mining subsidiary.
Full-year 2016 net income attributable to SXC was $14.4 million, or $0.22 per share, versus a loss of $22.0 million, or $0.34 per share, for full-year 2015. The improvement in full-year results was impacted by current year gains on extinguishment of debt of $25.0 million and favorable fair value adjustments to our contingent consideration obligation of $10.1 million. Additionally, in 2015 we recorded a $19.4 million impairment on our equity method investment in Visa SunCoke. These year-over-year improvements were offset by the unfavorable current year impacts from higher income tax expense, higher non-controlling interest related to earnings at SXCP, as well as losses of $14.7 million relating to the divestiture of our coal mining business.
Adjusted EBITDA was $77.3 million and $217.0 million in fourth quarter and full-year 2016, respectively, representing an increase of $22.3 million and $31.6 million compared to the same prior year periods. Both fourth quarter and full-year 2016 were favorably impacted by increased contributions from CMT of $21.9 million and $29.9 million, respectively. The divestiture of our coal mining business, as discussed above, resulted in lower operating costs which favorably impacted Adjusted EBITDA in 2016. Offsetting these contributions were lower year-over-year operating results in our Domestic Coke segment of $8.8 million and $16.2 million in the fourth quarter and full-year 2016, respectively, driven by a turbine failure at our Haverhill facility in the fourth quarter as well as lower energy sales and coal-to-coke yield gains in the full-year period. Full-year 2016 also benefited from the absence of a $12.6 million non-cash pension plan termination charge recorded in 2015.
FOURTH QUARTER 2016 SEGMENT RESULTS
Domestic Coke
Domestic Coke consists of cokemaking facilities and heat recovery operations at our Jewell, Indiana Harbor, Haverhill, Granite City and Middletown plants.
Three Months Ended December 31,
(Dollars in
millions, except
per ton amounts) 2016 2015 Increase/
(Decrease)
--- ---------
Sales and other
operating
revenues $261.2 $302.5 $(41.3)
Adjusted
EBITDA(1) $36.5 $45.3 $(8.8)
Sales Volume (in
thousands of
tons) 964 1,013 (49)
Adjusted EBITDA
per ton(2) $37.86 $44.72 $(6.86)
(1) See definitions of Adjusted
EBITDA and reconciliation
elsewhere in this release.
(2) Reflects Domestic Coke Adjusted
EBITDA divided by Domestic Coke
sales volumes.
-- Revenues were affected by both the pass-through of lower coal prices and
a decrease in sales volume of 49 thousand tons, primarily due to lower
production at Indiana Harbor and the impact of customer volume
accommodations at Haverhill. The impact of customer volume
accommodations on Adjusted EBITDA was mitigated by make-whole payments
from AK Steel.
-- Adjusted EBITDA decreased $8.8 million to $36.5 million driven by lower
volumes at Indiana Harbor due to the impact of the ongoing oven rebuilds
and lower coal-to-coke yields. Additionally, the quarter was impacted by
a turbine failure at our Haverhill facility, resulting in an unfavorable
net impact of $3.5 million. These impacts were partially offset by
favorable operating and maintenance spend.
Coal Logistics
Coal Logistics consists of the coal handling and mixing services operated by SXCP at our Convent Marine Terminal ("CMT"), Lake Terminal and Kanawha River Terminals ("KRT"). Additionally, Dismal River Terminal ("DRT"), which serves our Jewell cokemaking facility, is operated by SXC. The current and prior year periods are not comparable due to the construction of DRT in early 2016 and the recognition of a full-year of deferred revenue at CMT in 2016.
Three Months Ended December 31,
-------------------------------
(Dollars in
millions, except
per ton amounts) 2016 2015 Increase/
(Decrease)
--- ---------
Sales and other
operating revenues $48.2 $31.1 $17.1
Adjusted EBITDA(1) $45.3 $21.1 $24.2
Tons handled,
excluding CMT
(thousands of
tons)(2) 3,981 4,160 (179)
Tons handled by CMT
(thousands of
tons)(2) 1,731 1,395 336
(1) See definitions of Adjusted
EBITDA and reconciliation
elsewhere in this release.
(2) Reflects inbound tons handled
during the period.
-- Revenues were up $17.1 million, driven by a $18.0 million increase in
revenue at CMT due primarily to higher deferred revenue recognized in
the period related to volume short-falls over the full-year versus only
a partial year in 2015, as well as a $1.0 million contribution at DRT,
partially offset by lower volumes at KRT and Lake Terminal.
-- Adjusted EBITDA was up $24.2 million, driven primarily by a $21.9
million increase at CMT resulting from higher deferred revenue
recognized.
Brazil Coke
Brazil Coke consists of a cokemaking facility in Vitória, Brazil, which we operate for an affiliate of ArcelorMittal. In the fourth quarter, ArcelorMittal Brazil redeemed SunCoke's indirectly held preferred and common equity interest in Sol Coqueria Tubarão S.A. ("Brazil Investment") for consideration of $41.0 million, half of which was received in the fourth quarter 2016 and the other half which will be received on April 1, 2017.
With the redemption, the Company will no longer receive the $9.5 million annual dividend on its Brazil Investment. Also, starting in 2016, SunCoke will receive an incremental $5.1 million in licensing fees per year through 2023 related to the addition of certain patents to its existing intellectual property licensing agreement, which are currently in use by ArcelorMittal. SunCoke will continue to earn existing operating and technology fees of approximately $10 million per year through 2023 and, when combined with the new $5.1 million in technology fees, the total expected Adjusted EBITDA contribution from the Brazil facility is expected to be approximately $15 million per year.
-- Adjusted EBITDA decreased $4.0 million to $8.3 million in fourth quarter
2016, primarily due to the change in the Brazil Coke dividend net of
incremental licensing fees as discussed above.
Coal Mining
In April 2016, the Company divested substantially all of its coal mining business to Revelation Energy, LLC.
-- Adjusted EBITDA was a loss of $0.4 million in the current year period
compared to a loss of $5.5 million in the prior year period. The
improved results reflect lower operating costs due to the divestiture of
the business.
Corporate and Other
Corporate and other expenses, including legacy costs, in fourth quarter 2016 were $12.4 million, an improvement of $5.8 million versus fourth quarter 2015 primarily due to the timing of certain legacy expenses and lower professional service spend in the current year period. This was partially offset by $1.6 million unfavorable mark-to-market adjustments on deferred compensation driven by changes in the Company's share price.
2017 OUTLOOK
Our 2017 guidance is as follows:
-- Domestic coke production is expected to be approximately 3.9 million
tons
-- Consolidated Adjusted EBITDA is expected to be between $220 million and
$235 million
-- Adjusted EBITDA attributable to SXC is expected to be between $130
million and $141 million, reflecting the impact of public ownership in
SXCP
-- Capital expenditures are projected to be approximately $80 million
-- Cash generated by operations is estimated to be between $140 million and
$155 million
-- Cash taxes are projected to be between $8 million and $15 million
RELATED COMMUNICATIONS
Today, we will host an investor conference call at 11:00 a.m. Eastern Time (10:00 a.m. Central Time). Investors may participate in this call by dialing 1-877-201-0168 in the U.S. or 1-647-788-4901 if outside the U.S., confirmation code 47813261. This conference call will be webcast live and archived for replay in the Investor Relations section of www.suncoke.com.
SUNCOKE ENERGY, INC.
SunCoke Energy, Inc. (NYSE: SXC) supplies high-quality coke to the integrated steel industry under long-term, take-or-pay contracts that pass through commodity and certain operating costs to customers. We utilize an innovative heat-recovery cokemaking technology that captures excess heat for steam or electrical power generation. We are the sponsor of SunCoke Energy Partners, L.P. (NYSE: SXCP), a publicly traded master limited partnership, holding a 2 percent general partner interest, 54 percent limited partnership interest and all of the incentive distribution rights. Our cokemaking facilities are located in Illinois, Indiana, Ohio, Virginia, Brazil and India. To learn more about SunCoke Energy, Inc., visit our website at www.suncoke.com.
DEFINITIONS
-- Adjusted EBITDA represents earnings before interest, (gain) loss on
extinguishment of debt, taxes, depreciation and amortization ("EBITDA"),
adjusted for impairments, coal rationalization costs, changes to our
contingent consideration liability related to our acquisition of CMT,
the expiration of certain acquired contractual obligations, and
interest, taxes, depreciation and amortization and impairments
attributable to our equity method investment. EBITDA and Adjusted EBITDA
do not represent and should not be considered alternatives to net income
or operating income under GAAP and may not be comparable to other
similarly titled measures in other businesses. Management believes
Adjusted EBITDA is an important measure of the operating performance and
liquidity of the Company's net assets and its ability to incur and
service debt, fund capital expenditures and make distributions. Adjusted
EBITDA provides useful information to investors because it highlights
trends in our business that may not otherwise be apparent when relying
solely on GAAP measures and because it eliminates items that have less
bearing on our operating performance and liquidity. EBITDA and Adjusted
EBITDA are not measures calculated in accordance with GAAP, and they
should not be considered a substitute for net income, operating cash
flow or any other measure of financial performance presented in
accordance with GAAP.
-- Adjusted EBITDA attributable to SXC/SXCP represents consolidated
Adjusted EBITDA less Adjusted EBITDA attributable to noncontrolling
interests.
-- Legacy Costs include royalty revenues, costs associated with former
mining employee-related liabilities prior to the implementation of our
contractor mining business and ultimate disposal of our mining
operation.
FORWARD-LOOKING STATEMENTS
Some of the statements included in this press release constitute "forward-looking statements" (as defined in Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended). Forward-looking statements include all statements that are not historical facts and may be identified by the use of such words as "believe," "expect," "plan," "project," "intend," "anticipate," "estimate," "predict," "potential," "continue," "may," "will," "should" or the negative of these terms or similar expressions. Forward-looking statements are inherently uncertain and involve significant known and unknown risks and uncertainties (many of which are beyond the control of SXC) that could cause actual results to differ materially.
Such risks and uncertainties include, but are not limited to domestic and international economic, political, business, operational, competitive, regulatory and/or market factors affecting SXC, as well as uncertainties related to: pending or future litigation, legislation or regulatory actions; liability for remedial actions or assessments under existing or future environmental regulations; gains and losses related to acquisition, disposition or impairment of assets; recapitalizations; access to, and costs of, capital; the effects of changes in accounting rules applicable to SXC; and changes in tax, environmental and other laws and regulations applicable to SXC's businesses.
Forward-looking statements are not guarantees of future performance, but are based upon the current knowledge, beliefs and expectations of SXC management, and upon assumptions by SXC concerning future conditions, any or all of which ultimately may prove to be inaccurate. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. SXC does not intend, and expressly disclaims any obligation, to update or alter its forward-looking statements (or associated cautionary language), whether as a result of new information, future events or otherwise after the date of this press release except as required by applicable law.
In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, SXC has included in its filings with the Securities and Exchange Commission cautionary language identifying important factors (but not necessarily all the important factors) that could cause actual results to differ materially from those expressed in any forward-looking statement made by SXC. For information concerning these factors, see SXC's Securities and Exchange Commission filings such as its annual and quarterly reports and current reports on Form 8-K, copies of which are available free of charge on SXC's website at www.suncoke.com. All forward-looking statements included in this press release are expressly qualified in their entirety by such cautionary statements. Unpredictable or unknown factors not discussed in this release also could have material adverse effects on forward-looking statements.
SunCoke Energy, Inc.
Consolidated Statements of Operations
(Unaudited)
Three Months Ended Years Ended
December 31,
December 31,
2016 2015 2016 2015
---- ---- ---- ----
(Dollars and shares in millions, except per share amounts)
Revenues
Sales and other operating
revenue $325.4 $343.6 $1,222.2 $1,351.3
Other income, net 0.2 10.0 1.1 11.4
--- ---- --- ----
Total revenues 325.6 353.6 1,223.3 1,362.7
----- ----- ------- -------
Costs and operating expenses
Cost of products sold and
operating expenses 224.0 274.0 906.5 1,098.4
Selling, general and
administrative expenses 22.5 21.5 91.3 75.4
Depreciation and amortization
expense 31.8 33.3 114.2 109.1
Loss on divestiture of
business - - 14.7 -
Total costs and operating
expenses 278.3 328.8 1,126.7 1,282.9
----- ----- ------- -------
Operating income 47.3 24.8 96.6 79.8
Interest expense, net 13.2 14.7 53.5 56.2
(Gain) loss on extinguishment
of debt (0.1) (8.9) (25.0) 0.5
---- ---- ----- ---
Income before income tax
expense (benefit) and loss
from equity method investment 34.2 19.0 68.1 23.1
Income tax expense (benefit) 2.7 (13.9) 8.6 (8.8)
Loss from equity method
investment - - - 21.6
--- --- --- ----
Net income 31.5 32.9 59.5 10.3
Less: Net income attributable
to noncontrolling interests 14.5 13.9 45.1 32.3
---- ---- ---- ----
Net income (loss) attributable
to SunCoke Energy, Inc. $17.0 $19.0 $14.4 $(22.0)
===== ===== ===== ======
Earnings (loss) attributable
to SunCoke Energy, Inc. per
common share:
Basic $0.26 $0.30 $0.22 $(0.34)
Diluted $0.26 $0.30 $0.22 $(0.34)
Weighted average number of
common shares outstanding:
Basic 64.2 64.0 64.2 65.0
Diluted 64.9 64.0 64.4 65.0
SunCoke Energy, Inc.
Consolidated Balance Sheets
(Unaudited)
December 31,
2016 2015
---- ----
(Dollars in millions, except par
value amounts)
Assets
Cash and cash
equivalents $134.0 $123.4
Receivables 60.7 64.6
Receivable
from
redemption of
Brazilian
investment 20.5 -
Inventories 92.5 121.8
Income tax
receivable 4.6 11.6
Other current
assets 3.8 3.9
Assets held
for sale - 0.9
--- ---
Total current
assets 316.1 326.2
----- -----
Restricted
cash 0.5 18.2
Investment in
Brazilian
cokemaking
operations - 41.0
Properties,
plants and 2016 and
equipment 2015,
(net of respectively)
accumulated
depreciation
of $625.9
million and
$590.2
million at
December 31, 1,542.6 1,582.0
Goodwill 76.9 71.1
Other
intangible
assets, net 179.0 190.2
Deferred
charges and
other assets 5.8 15.4
Long-term
assets held
for sale - 11.4
--- ----
Total assets $2,120.9 $2,255.5
======== ========
Liabilities and Equity
Accounts
payable $98.6 $99.8
Accrued
liabilities 49.8 42.9
Deferred
revenue 2.5 2.1
Current
portion of
long-term
debt and
financing
obligation 4.9 1.1
Interest
payable 16.2 18.9
Liabilities
held for sale - 0.9
--- ---
Total current
liabilities 172.0 165.7
----- -----
Long-term
debt and
financing
obligation 849.2 997.7
Accrual for
black lung
benefits 45.4 44.7
Retirement
benefit
liabilities 29.0 31.3
Deferred
income taxes 352.5 349.0
Asset
retirement
obligations 13.9 16.3
Other deferred
credits and
liabilities 19.0 22.1
Long-term
liabilities
held for sale - 5.9
--- ---
Total
liabilities 1,481.0 1,632.7
------- -------
Equity
Preferred
stock, $0.01
par value.
Authorized
50,000,000
shares; no
issued shares
at December
31, 2016 and
2015 - -
Common stock,
$0.01 par December 31,
value. 2016 and
Authorized 2015,
300,000,000 respectively
shares;
issued
71,707,304
shares and
71,489,448
shares at 0.7 0.7
Treasury
stock,
7,477,657
shares at
December 31,
2016 and 2015
respectively (140.7) (140.7)
Additional
paid-in
capital 492.1 486.1
Accumulated
other
comprehensive
loss (19.0) (19.8)
Retained
deficit (22.0) (36.4)
----- -----
Total SunCoke
Energy, Inc.
stockholders'
equity 311.1 289.9
Noncontrolling
interests 328.8 332.9
----- -----
Total equity 639.9 622.8
----- -----
Total
liabilities
and equity $2,120.9 $2,255.5
======== ========
SunCoke Energy, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
Years Ended December 31,
2016 2015
---- ----
(Dollars in millions)
Cash Flows from Operating
Activities:
Net income $59.5 $10.3
Adjustments to reconcile net
income to net cash provided by
operating activities:
Loss on
divestiture of
business 14.7 -
Loss from equity
method
investment - 21.6
Depreciation and
amortization
expense 114.2 109.1
Deferred income
tax benefit 3.1 (5.6)
Settlement loss
and expense for
pension plan - 13.1
Gain on
curtailment and
payments in
excess of
expense for
postretirement
plan benefits (2.6) (8.0)
Share-based
compensation
expense 6.5 7.2
(Gain) loss on
extinguishment
of debt (25.0) 0.5
Changes in working capital
pertaining to operating
activities (net of the effects
of divestiture and
acquisition):
Receivables 3.7 18.8
Inventories 29.4 23.2
Accounts payable (0.8) (17.9)
Accrued
liabilities 6.8 (24.3)
Deferred revenue 0.4 (4.4)
Interest payable (2.7) (1.0)
Income taxes 7.0 (5.6)
Accrual for
black lung
benefits 0.3 6.0
Other 4.6 (1.9)
--- ----
Net cash
provided by
operating
activities 219.1 141.1
----- -----
Cash Flows from Investing
Activities:
Capital
expenditures (63.7) (75.8)
Acquisition of
businesses, net
of cash
received - (191.7)
Decrease
(increase) in
restricted cash 17.7 (17.7)
Divestiture of
coal business (12.8) -
Return of
Brazilian
investment 20.5 -
Other investing
activities 2.1 -
Net cash used in
investing
activities (36.2) (285.2)
----- ------
Cash Flows from Financing
Activities:
Proceeds from
issuance of
long-term debt - 260.8
Repayment of
long-term debt (66.1) (248.1)
Debt issuance
costs (0.2) (5.7)
Proceeds from
revolving
facility 28.0 292.4
Repayment of
revolving
facility (98.4) (50.0)
Proceeds from
financing
obligation 16.2 -
Repayment of
financing
obligation (1.0) -
Dividends paid - (28.0)
Cash
distributions
to
noncontrolling
interests (49.4) (43.3)
Shares
repurchased - (35.7)
SunCoke Energy
Partners, L.P.
units
repurchased - (12.8)
Other financing
activities (1.4) (1.1)
Net cash (used
in) provided by
financing
activities (172.3) 128.5
------ -----
Net increase
(decrease) in
cash and cash
equivalents 10.6 (15.6)
Cash and cash
equivalents at
beginning of
year 123.4 139.0
----- -----
Cash and cash
equivalents at
end of year $134.0 $123.4
====== ======
Supplemental Disclosure of Cash
Flow Information
Interest paid $58.4 $58.1
Income taxes
paid, net of
refunds of $8.2
million and
$1.5 million,
respectively $(2.3) $2.4
SunCoke Energy, Inc.
Segment Financial and Operating Data
(unaudited)
The following tables set forth financial and operating data for the three and twelve months ended December 31, 2016 and 2015:
Three Months Ended Years Ended
December 31, December 31,
2016 2015 2016 2015
---- ---- ---- ----
(Dollars in millions)
Sales and other operating
revenues:
Domestic Coke $261.2 $302.5 $1,097.2 $1,243.6
Brazil Coke 16.0 7.6 39.5 34.0
Coal Logistics(1) 48.2 31.1 84.7 60.8
Coal Logistics
intersegment sales 7.9 5.1 23.2 20.4
Coal Mining - 2.4 0.8 12.9
Coal Mining intersegment
sales - 26.7 22.0 101.0
Elimination of
intersegment sales (7.9) (31.8) (45.2) (121.4)
----- ----- ------
Total sales and other
operating revenue $325.4 $343.6 $1,222.2 $1,351.3
====== ====== ======== ========
Adjusted EBITDA(2)
Domestic Coke $36.5 $45.3 $193.9 $210.1
Brazil Coke 8.3 12.3 16.2 22.4
Coal Logistics(1) 45.3 21.1 63.9 38.0
Coal Mining (0.4) (5.5) (6.0) (18.9)
Corporate and Other,
including legacy costs,
net(3) (12.4) (18.2) (51.0) (66.2)
----- ----- ----- -----
Total Adjusted EBITDA $77.3 $55.0 $217.0 $185.4
===== ===== ====== ======
Coke Operating Data:
Domestic Coke capacity
utilization (%) 90 96 93 97
Domestic Coke production
volumes (thousands of
tons) 964 1,028 3,954 4,122
Domestic Coke sales
volumes (thousands of
tons) 964 1,013 3,956 4,115
Domestic Coke Adjusted
EBITDA per ton(4) $37.86 $44.72 $49.01 $51.06
Brazilian Coke production-
operated facility
(thousands of tons) 446 436 1,741 1,760
Coal Logistics Operating
Data:
Tons handled, excluding
CMT (thousands of
tons)(5) 3,981 4,160 14,076 16,652
Tons handled by CMT
(thousands of tons)(1)(5) 1,731 1,395 4,493 2,212
(1) The current and prior full year
periods are not comparable due to
the impact of CMT, which was
acquired on August 12, 2015.
(2) See definition of Adjusted EBITDA
and reconciliation to GAAP
elsewhere in this release.
(3) Legacy costs, net include costs
associated with former mining
employee-related liabilities
prior to the implementation of our
contractor mining business and
ultimate disposal of mining
operations, net of certain royalty
revenues. See details of these
legacy items below.
Three Months Ended Years Ended
December 31, December 31,
2016 2015 2016 2015
---- ---- ---- ----
(Dollars in millions)
Black lung expense $(2.9) $(6.5) $(8.1) $(9.8)
Postretirement
benefit plan
(expense) benefit (0.1) (0.1) (0.7) 3.6
Defined benefit plan
expense - - - (13.1)
Workers compensation
expense - (0.7) (0.6) (2.3)
Other 0.2 - 0.4 (0.4)
--- --- ----
Total legacy costs,
net $(2.8) $(7.3) $(9.0) $(22.0)
===== ===== ===== ======
(4) Reflects Domestic Coke
Adjusted EBITDA divided
by Domestic Coke sales
volumes.
(5) Reflects inbound tons
handled during the
period.
SunCoke Energy, Inc.
Reconciliations of Non-GAAP Information
Adjusted EBITDA to Net Income
Three Months Ended Years Ended
December 31, December 31,
2016 2015 2016 2015
---- ---- ---- ----
Net cash provided by operating
activities $53.0 $58.1 $219.1 $141.1
Subtract:
Loss on divestitures of business - - 14.7 -
Depreciation and amortization expense 31.8 33.3 114.2 109.1
Deferred income tax expense (benefit) (1.4) (12.5) 3.1 (5.6)
(Gain) loss on extinguishment of debt (0.1) (8.9) (25.0) 0.5
Changes in working capital and other (8.8) 13.3 52.6 26.8
Net income (loss) $31.5 $32.9 $59.5 $10.3
----- ----- ----- -----
Add:
Loss on divestitures of business $ - $ - $14.7 $ -
Adjustment to unconsolidated affiliate
earnings(1) - - - 20.8
Coal rationalization costs(2) - 0.2 0.4 0.6
Depreciation and amortization expense 31.8 33.3 114.2 109.1
Interest expense, net 13.2 14.7 53.5 56.2
(Gain) loss on extinguishment of debt (0.1) (8.9) (25.0) 0.5
Income tax expense (benefit) 2.7 (13.9) 8.6 (8.8)
Contingent consideration adjustments(3) (1.8) - (10.1) -
Expiration of land deposits(4) - - 1.9 -
Non-cash reversal of acquired
contractual obligations(5) - (3.3) (0.7) (3.3)
--- ---- ---- ----
Adjusted EBITDA $77.3 $55.0 $217.0 $185.4
----- ----- ------ ------
Subtract: Adjusted EBITDA attributable
to noncontrolling interest(6) 28.8 24.9 86.6 81.2
Adjusted EBITDA attributable to SunCoke
Energy, Inc. $48.5 $30.1 $130.4 $104.2
===== ===== ====== ======
(1) Reflects share of interest, taxes,
depreciation and amortization
related to VISA SunCoke. During
2015, as a result of continued
decline in demand and price of
coke in India an additional
impairment of $19.4 million was
recorded, resulting in an
investment balance of zero.
Beginning in the fourth quarter
of 2015, we no longer include the
results of our share of VISA
SunCoke in our consolidated
financial statements.
(2) Prior to the divestiture of the
coal mining business, we incurred
coal rationalization costs
including employee severance,
contract termination costs and
other costs to idle mines during
the execution of our coal
rationalization plan. The year
ended December 31, 2015 included
$2.3 million of income related to
a severance accrual adjustment.
(3) The Partnership amended its
contingent consideration terms
with The Cline Group during the
first quarter of 2016. This
amendment and subsequent fair
value adjustments to the
contingent consideration
liability, resulted in gains of
$1.8 million and $10.1 million
recorded during the three and
twelve months ended December 31,
2016, respectively, which were
excluded from Adjusted EBITDA.
(4) Reflects the expiration of land
deposits in Kentucky.
(5) In association with the
acquisition of CMT, we assumed
certain performance obligations
under existing contracts and
recorded liabilities related to
such obligations. These
contractual performance
obligation have expired without
the customer requiring
performance. As such, the
Partnership reversed the
liabilities as we no longer have
any obligations under the
contract.
(6) Reflects non-controlling interest
in Indiana Harbor and the portion
of the Partnership owned by
public unitholders.
SunCoke Energy, Inc.
Reconciliation of Non-GAAP Information
Estimated 2017 Net Cash Provided by Operating Activities to Estimated Net Income and Consolidated Adjusted
EBITDA
2017
Low High
--- ----
Net Cash Provided by
Operating activities $140 $155
Subtract:
Depreciation and
amortization expense 131 131
Changes in working capital
and other (20) (18)
Net Income $29 $42
--- ---
Add:
Depreciation and
amortization expense 131 131
Interest expense, net 57 54
Income tax expense 3 8
Adjusted EBITDA $220 $235
---- ----
Subtract: Adjusted EBITDA
attributable to
noncontrolling interest(1) 90 94
Adjusted EBITDA attributable
to SXC $130 $141
==== ====
(1) Reflects non-controlling
interest in Indiana Harbor
and the portion of the
Partnership owned by public
unitholders.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/suncoke-energy-inc-announces-fourth-quarter-and-full-year-2016-results-and-provides-full-year-2017-guidance-300397074.html
SOURCE SunCoke Energy, Inc.
