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PEABODY ENERGY CORP (BTU)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered solid execution in a weak price tape: revenue $937.0M, diluted EPS $0.27, Adjusted EBITDA $144.0M, with broad-based cost outperformance and strong U.S. thermal volumes; operating cash flow was $120.5M .
  • Seaborne Thermal led profitability (Adjusted EBITDA $84.2M; 32% margin) as Wilpinjong over-delivered and costs ran well below guidance; PRB volumes were robust on a sharp increase in U.S. coal burn, while Seaborne Met remained pressured by benchmark price softness and shipment timing (Adj. EBITDA $13.2M) .
  • Management raised/updated 2025 guidance datapoints: PRB full-year volume range lifted (76–78Mt from 72–78Mt prior), significantly increased “priced” ton coverage across seaborne segments at lower realized prices, with cost ranges largely maintained; Q2 guides call for seasonal volume dip and normalization of costs from Q1’s exceptional levels .
  • Strategic updates: Centurion development is ahead of plan (four CM units producing; 500kt sales target for 2025; longwall in Q1 2026), a seven-year 7–8Mtpa PRB supply deal was signed with Associated Electric, and a MAC notice was issued regarding the planned Anglo met coal acquisition after the Moranbah North event; financing process is on hold pending clarity .

What Went Well and What Went Wrong

  • What Went Well

    • Cost discipline: Q1 costs per ton came in below targets in Seaborne Thermal and Met, and near the low end in PRB and Other U.S. Thermal; Seaborne Thermal achieved 32% margins and $84.2M Adj. EBITDA as Wilpinjong exceeded production .
    • U.S. demand tailwinds: PRB shipped 19.6Mt vs expectations; management cited coal-fueled generation up ~20% YoY YTD, drawing down inventories and supporting PRB demand into 2025 .
    • Commercial momentum and project execution: New 7–8Mtpa, 7-year PRB contract with Associated Electric; Centurion ahead of schedule and targeting Q1’26 longwall; company generated $120.5M operating cash flow in Q1 .
    • Management tone: “Controlling the controllables” and diversified portfolio resiliency; “powerful first quarter results amid challenging markets” .

  • What Went Wrong

    • Seaborne Met pressure: Adj. EBITDA $13.2M as benchmark prices fell and Shoal Creek restart was slowed given poor spot conditions; volumes were modestly below targets .
    • Realized price headwinds: Seaborne Thermal realized export prices fell 18% vs Q4’24; Seaborne Met revenue/ton down vs prior year; overall revenue declined QoQ .
    • Anglo acquisition uncertainty: MAC notice on Moranbah North (gas ignition); no known longwall restart timetable; financing paused until clarity, creating overhang on the “transformational” met strategy .

Financial Results

Overall P&L vs prior quarter and prior year

MetricQ1 2024Q4 2024Q1 2025
Revenues ($M)$983.6 $1,123.1 $937.0
Net Income Attributable to Common ($M)$39.6 $30.6 $34.4
Diluted EPS – Continuing Ops ($)$0.30 $0.25 $0.27
Adjusted EBITDA ($M)$160.5 $176.7 $144.0

Segment performance and mix

SegmentQ1 2024 Revenue ($M)Q4 2024 Revenue ($M)Q1 2025 Revenue ($M)Q1 2024 Adj. EBITDA ($M)Q4 2024 Adj. EBITDA ($M)Q1 2025 Adj. EBITDA ($M)
Seaborne Thermal$283.9 $309.3 $265.1 $93.8 $111.8 $84.2
Seaborne Metallurgical$247.0 $271.8 $220.1 $48.3 $22.8 $13.2
Powder River Basin$254.1 $317.5 $275.6 $16.4 $52.7 $36.3
Other U.S. Thermal$191.6 $212.3 $168.7 $46.5 $40.5 $32.9
Corporate & Other$7.0 $12.2 $7.5 n/an/an/a
Total$983.6 $1,123.1 $937.0 $160.5 $176.7 $144.0

Operational KPIs by segment

KPIQ1 2024Q4 2024Q1 2025
Seaborne Thermal tons sold (M)4.0 4.2 4.4
– Export / Domestic (M)2.5 / 1.5 2.8 / 1.4 2.9 / 1.5
– Revenue/ton$71.24 $73.55 $60.64
– Costs/ton$47.71 $46.97 $41.37
Seaborne Met tons sold (M)1.4 2.2 1.8
– Revenue/ton$172.60 $123.41 $125.15
– Costs/ton$138.83 $113.05 $117.66
PRB tons sold (M)18.7 23.0 19.6
– Revenue/ton$13.62 $13.79 $14.02
– Costs/ton$12.74 $11.50 $12.18
Other U.S. Thermal tons sold (M)3.2 3.7 3.1
– Revenue/ton$59.75 $57.74 $54.32
– Costs/ton$45.25 $46.73 $43.71

Balance sheet and cash flow highlights

  • Cash & Cash Equivalents $696.5M; Total current assets $1.67B; Total assets $5.78B; Long-term debt (ex current) $331.2M; Current portion $16.0M; Net cash position; liquidity >$1B (cash + revolver availability) .
  • Net cash from continuing operations $120.5M in Q1; capex additions $70.4M; Centurion development spend $47M (FCF ~$30M per management) .

Guidance Changes

Full-year 2025 guidance vs prior update (excludes planned Anglo acquisition)

MetricPeriodPrevious Guidance (Feb 6)Current Guidance (May 6)Change
Seaborne Thermal – Total Volume (Mt)FY2514.2–15.2 14.2–15.2 Maintained
Seaborne Thermal – Priced Volume (Mt)FY255.6 9.1 Increased priced coverage
Seaborne Thermal – Priced Volume $/tonFY25$30.86 $48.14 Updated (higher) on more priced tons
Seaborne Thermal – Avg Cost/tonFY25$47–$52 $47–$52 Maintained
Seaborne Met – Total Volume (Mt)FY258.0–9.0 8.0–9.0 Maintained
Seaborne Met – Priced Volume (Mt)FY250.5 2.5 Increased priced coverage
Seaborne Met – Priced Volume $/tonFY25$128.00 $121.00 Lower priced level
Seaborne Met – Avg Cost/tonFY25$120–$130 $120–$130 Maintained
PRB – Total Volume (Mt)FY2572–78 76–78 Raised low end
PRB – Priced Volume (Mt)FY2571 77 Higher priced coverage
PRB – Avg Price/tonFY25$13.85 $13.85 Unchanged
PRB – Avg Cost/tonFY25$12.00–$12.75 $12.00–$12.75 Maintained
Other U.S. Thermal – Total Volume (Mt)FY2513.4–14.4 13.4–14.4 Maintained
Other U.S. Thermal – Priced Volume (Mt)FY2513.6 13.6 Maintained
Other U.S. Thermal – Avg Price/tonFY25$52.00 $52.00 Maintained
Other U.S. Thermal – Avg Cost/tonFY25$43–$47 $43–$47 Maintained
SG&A ($M)FY25$95 $95 Maintained
Total Capex ($M)FY25$450 $450 Maintained
Major Project Capex ($M)FY25$280 $280 Maintained
Sustaining Capex ($M)FY25$170 $170 Maintained
ARO Cash Spend ($M)FY25$50 $50 Maintained
DividendCurrent$0.075/sh (declared Feb 6) $0.075/sh (declared May 6; payable Jun 4) Maintained

Near-term (Q2 2025) operating guidance

SegmentQ2 2025 Guidance
Seaborne ThermalVolume 4.0Mt; exports 2.5Mt; 0.8Mt priced at ~$77/t; 1.0Mt Newcastle and 0.7Mt high-ash unpriced; costs $45–$50/t .
Seaborne MetVolume 2.2Mt; expected to achieve 70–75% of PHCC index; costs $120–$130/t .
PRB U.S. ThermalVolume 19Mt; avg price $13.80/t; costs ~$12.50–$13.00/t .
Other U.S. ThermalVolume 3.3Mt; avg price $52.00/t; costs ~$41–$45/t .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3’24 and Q4’24)Current Period (Q1’25)Trend
Centurion projectQ3’24: “Exceptional progress,” development exceeded plan; first shipment scheduled for Q4’24 . Q4’24: first coal shipped; longwall start March 2026; 500kt 2025 sales target .Four CM units producing; development 20% ahead of target; on track for Q1’26 longwall; ahead of 500kt 2025 sales .Positive execution; schedule reaffirmed.
U.S. coal demand & PRBQ3’24: PRB volumes better than expected; cost focus lifted margins . Q4’24: PRB 23.0Mt; stable price/costs .Coal generation up ~20% YTD; drawdown in inventories; PRB shipments beat expectations; new 7–8Mtpa 7-year deal .Strengthening domestic demand and contracting.
Seaborne ThermalQ3’24: strong production; added inventory; 38% margins . Q4’24: 36% margins; Wilpinjong strength .32% margins despite realized price declines; costs below guidance .Still resilient; price headwinds persist.
Seaborne MetQ3’24: pricing weaker; cost improvements; BI insurance tailwind earlier in year . Q4’24: 2.2Mt; costs -12% QoQ to $113/t .Soft benchmarks; slowed Shoal Creek return; costs below target; volumes 1.8Mt .Near-term weak but positioned for 2H improvement.
Anglo acquisition (MAC)Q4’24: “transformational” acquisition targeted to close next quarter .MAC notice on Moranbah North; no restart timetable; financing paused pending clarity .Uncertain; potential delay/termination risk.
Policy/tariffsQ3’24/ Q4’24: Not central themes in releases.Exec orders supportive of U.S. coal; multiple states bolstering dispatchable power; tariffs on China volumes immaterial (<0.5% exposure) .Policy tailwinds for U.S. thermal; limited tariff risk.

Management Commentary

  • CEO frame: “Peabody is off to a strong start in 2025… solid volumes and great cost management that mitigated impacts of cyclically low seaborne coal prices.”
  • On U.S. demand/policy: “Coal-fueled generation up a stunning 20% over the prior year… we signed an agreement with Associated Electric… 7 to 8 million tons per year for a minimum of 7 years.”
  • On Anglo MAC: “There is no known timetable for resuming longwall production… safety inspections only… we view [impacts] to be very, very significant.”
  • CFO on financials: “Net income $34M, EPS $0.27 and adjusted EBITDA $144M… generated $30M in free cash flow, net of $47M of continued development at Centurion… nearly $700M of cash and over $1B of liquidity.”

Q&A Highlights

  • Anglo MAC process: 10 days for Anglo to respond; up to 90 days cure; BTU must be satisfied with cure; financing on hold due to uncertainty around Moranbah North .
  • Shoal Creek: Restart slowed prudently amid weak March spot; ~170kt withheld; below-segment-average cost mine, but Q1 deferral did not lower cost—other mines drove cost outperformance .
  • Met netbacks: High-Vol A FOB index not representative of delivered Asia; current delivered ~$160–$170/mt with $30–$35 freight, implying FOB netback below index .
  • Seaborne Thermal volumes: H2’25 will be lower as Wambo underground winds down and Wilpinjong’s Q1 outperformance won’t repeat .
  • U.S. policy impact: Key is halting plant closures and enabling longer-term coal contracting; multiple utilities re-engaging on term supply .
  • PRB durability: Competitive reserve base and cost structure underpin margins; demand tailwinds support confidence in long-term cash flows .
  • Centurion capex cadence: $47M in Q1; ~$150M remaining to reach Southern District longwall production .

Estimates Context

  • S&P Global consensus datapoints for Q1 2025 were not available with estimate counts and returned only actualized values; we therefore do not present “beat/miss” vs consensus for revenue/EPS/EBITDA this quarter and instead benchmark results vs prior periods and company guidance .
  • EBITDA “consensus” placeholder data available in S&P Global showed $137M*, which is close to but below actual Adjusted EBITDA of $144.0M; EPS and revenue fields returned actuals only (no valid consensus comparison)* .
    Note: *Values retrieved from S&P Global.

Key Takeaways for Investors

  • Cost execution is the core bull point: broad-based cost wins, especially in Seaborne Thermal and PRB, cushioned weak seaborne pricing and supported solid cash generation .
  • U.S. thermal tailwinds are strengthening: policy support and higher coal burn underpin PRB demand, evidenced by the Associated Electric 7–8Mtpa, 7-year deal and raised FY PRB volume range .
  • Seaborne Met remains the swing factor: near-term softness and shipment timing weighed on profits, but management expects improved 2H with asset resets and potential market tightening .
  • Anglo acquisition overhang: MAC notice injects uncertainty and pauses financing; resolution path (sustainable Moranbah longwall) will drive positioning and multiple, positive or negative .
  • Centurion is executing to plan and is a medium-term margin uplift: ahead of schedule with Q1’26 longwall start targeted; management highlighted self-funded development and robust expected returns .
  • Liquidity and capital return intact: ~$697M cash and >$1B liquidity; dividend maintained at $0.075; balance sheet remains net cash positive, offering flexibility through the cycle .
  • Near-term setup: Q2 is seasonally lighter with normalizing costs; watch met pricing trajectory, Moranbah North clarity, and U.S. coal burn trends for upside/downside catalysts .

Appendix: Additional Disclosures and Data

  • Dividend: $0.075 per share declared May 6, 2025; payable June 4, 2025 to holders of record May 15, 2025 .
  • Balance sheet: Cash & Equivalents $696.5M; LT Debt $331.2M; Current Debt $16.0M; Total Assets $5.78B .
  • Q1 2025 segment per-ton metrics (illustrative): Seaborne Thermal revenue/ton $60.64, costs/ton $41.37; Seaborne Met revenue/ton $125.15, costs/ton $117.66; PRB revenue/ton $14.02, costs/ton $12.18; Other U.S. Thermal revenue/ton $54.32, costs/ton $43.71 .

Sources: BTU Q1 2025 8-K with press release and exhibits, earnings call transcript, and company press releases – – –.