Peabody Energy Corporation Price & Performance (BTU)

And you'll find our statements on forward looking info in the release we do encourage you to consider the risk factors that we reference here along with our public filings with the SEC. And I'll now turn the call over to Jim. Thanks, Vic.

Good morning, everyone.

KeyBuddy had a strong finish to 2024 marked by a highly productive quarter that sets the foundation for multiple years of substantial growth and value creation. Consider that in the past three months, we turned in a solid fourth quarter results even in the face of some geologic and pricing challenges.

Ship the first coal to market from the Centurion mine Agreed to buy multiple premium hard coking coal mines from Anglo American. Entered into an agreement with clean energy leader RWE to develop renewable energy projects on reclaimed mine lands. Completed a year in which we returned $221,000,000 to shareholders, while continuing to reinvest in the business. Set a new one hundred and forty plus year company record for lowest accident rates reclaimed 70% more land than we disturbed while freeing up more than $100,000,000 in reclamation binding obligations, and again achieved the top rating for governance by ratings firm ISS. We know of no other coal company that can cite that record of recent positive momentum. And while it is an impressive list, by no means can we say that we're hitting on all cylinders yet. Case in point, Seaborne met coal prices are off 45% in the past year as we move through the low with expectations of improvement later in the year. U. S. Coal demand hasn't yet caught the uplift that can be expected from growing domestic power demand which we believe will occur over time. And we've worked through geologic challenges at our 20 mile mine with increased production just now taking hold.

I'll spend a moment updating you on our major to transform Peabody into a company focused on serving growing met coal demands at Asian steel mills. Late in the quarter Peabody shipped its first coal from the Centurion mine to a Southeast Asian steel mill. We now have four continuous miners in coal in Centurion Southern District expect two continuous miners to enter coal in the Northern District in the third quarter. For 2025, we're looking at 500,000 tons of development coal from Centurion, ahead of our projected 3,500,000 tons in 2026, longwall production in the Southern District begins, I'm also pleased to report that Peabody's planned acquisition of premium hard coking coal mines in Australia from Anglo American is progressing well. Since signing the agreement, we've been active on a number of fronts.

We've received regulatory approvals from several jurisdictions advanced the contractual preemption process started the permanent financing process, and have begun in-depth integration planning. We're now targeting completion of the acquisition next quarter obviously subject to clearing the closing conditions. I'll remind investors of the many strategic and financial aspects that make this transaction so appealing.

First of all, this positions Peabody as a leading seaborne met coal supplier. On a pro form a basis, we expect three fourths Peabody's EBITDA in 2026 to come from metallurgical coal. This is also an acquisition that we believe is accretive to cash flows across all periods. The transaction boosts both coking coal quality improving realizations and mine lives with averages of more than twenty years. Geographically, we will have the logistics advantage of having most of our met coal production and sales the Pacific Rim, As global steel production continues to shift to Asia, We are highly confident that there are some $100,000,000 a year in synergies to be captured post acquisition. Finally, we believe that the strong cash flows of the acquired assets will accommodate continued shareholder returns and lead to a favorable rerating of the stock. From the acquired mines, we're projecting 11,300,000 tons of saleable production, our first full year of ownership in 2026. Since our November announcement, our confidence in those numbers has only grown. For example, a number of operational improvements are being implemented by And as we speak, the new longwall at Moranbah North is being ordered.

In a moment, I'll turn the call over to Malcolm Roberts, our Chief Marketing Officer to talk through the global coal markets. As a lead in, I would note that The U. S. Is experiencing the strongest confluence of policy, and commercial tailwinds that we've seen in more than two decades Consider these facts. First of all, After some fifteen years of flat electricity load growth in U. S, utility experts and industry observers are now expecting 2% to 3% annual load growth in coming years due to data centers and increased electrification. Second, following multiple years of premature retirements in coal fuel generation, we've now seen deferrals in retirement plans extending the life of 51 coal units in 17 states constituting 26 gigawatts of power, and up to power 20,000,000 homes. Third, have a new administration that is vocally pro coal and is already taking steps to facilitate common sense policies to assist our utility customers while also encouraging greater exports of LNG to Europe. Fourth, are seeing a favorable environment to increase utilization of existing coal plants. Which ran at 72% of capacity on average early last decade Most recently, we're only averaging 42% utilization. And finally, we have new entrants into merchant power generation and look to change up the dynamics of recent years.

Peabody itself has been approached by household name private equity funds that are looking for creative means to match up reliable low cost coal plants with growing data center needs. For backfill generation to feed a capacity hungry grid, Having covered U. S. Markets, Malcolm, ask you to complete the discussion with seaborne supply demand dynamics. You've given a good overview of U. S. Policy and market trends. Those trends along with strong winter weather have drawn down stockpiles in our mines. And at our customers. Our U. S. Thermal coal production is largely spoken for during the first half of the year and we expect to see our customer base come to market for additional volumes as the year progresses. In our discussions with customers, anecdotally confirming that the narrative of data centers driving electricity to Demand growth is real. Now I'll turn to what we're seeing in global seaborne markets starting with met coal. Near term seaborne met markets remain well supplied as the Chinese domestic economy remains soft China's apparent steel consumption declined by approximately 5% in 2024 to just under 900,000,000 tons.

Leading to net steel exports to increase by 30% to the highest level since 2015.

Another way of viewing steel from our perspective is its refined metallurgical coal.

So China's strong steel exports translated into otherwise weaker met coal demand elsewhere, steel production outside of China remained largely steady as a result of growth in India however margins have become challenged. Like most observers, we don't view China as the growth engine for met coal demand growth over time though. That role is likely to be played by India and in 2025, we expect an 8% increase in Indian steel production underwritten by several new blast furnaces coming online.

From a supply perspective, we're seeing some tightness in the premium low volt PCI segment. In the coking coal segment, there have been notable disruptions in high vol coking coal production, including mine fires and bankruptcies. That is partially offsetting some of the easing of demand.

From Atlantic buyers. Longer term, we anticipate the demand and supply fundamentals to drive increasing price spreads between premium hard coking coals and lesser grades, which of course is the thesis underpinning the development of the Centurion mine and our premium hard coking coal acquisition.

Turning to Seaboard thermal markets.

To wrap up 2024, China increased total coal imports to five forty three million metric tons, a 14.4% increase from 2023. China's imports of Australian coal increased by over 50% during the same period. The increase in Chinese imports was the key contributor to global seaborne demand growth during 2024. Within the global seaborne thermal market, we've seen a mix in the Northern Hemisphere of colder weather in the Atlantic and warmer winter weather in Asia. Recent demand for imports have been mixed with stockpiles in jurisdictions such as China and India higher than normal Attention is now Turning to industrial activity following Lunar New Year breaks in China and Asia more generally in coming weeks. As the year progresses, we'll see how Europe restocking of natural gas may influence LNG pricing and the relative competitiveness of Australian high energy coal, We'll also observe how recently announced trade tariffs influenced seaborne trade flows as relative price competitive competitiveness of U. S. Coal exports to China are likely impacted That's a brief review of review of the coal market dynamics. I'll leave leave it there for now and welcome the opportunity provide further details in Q and A. And now I'll turn the call over to Mark.

Thanks, Malcolm, and good morning. Jim noted our strong finish to the year.

And I'll provide some additional color. In the fourth quarter, we recorded net income attributable to common stockholders of $31,000,000 or $0.25 per diluted share. And adjusted EBITDA of $177,000,000 The company generated $121,000,000 of operating cash flow from continuing operations.

This contributed to a full year net income attributable to common stockholders of $371,000,000 and adjusted EBITDA of $872,000,000 The company generated $613,000,000 of operating cash flow from continuing operations. In 2024, we returned $221,000,000 to shareholders, through share repurchases and dividends advanced Centurion through its first coal shipment in the fourth quarter.

I would note since restarting our shareholder return program, we've returned $600,000,000 to shareholders and invested $500,000,000 in the development and expansion of Centurion. At December 31, Peabody had $700,000,000 of cash and available liquidity of 1,100,000,000.0 We believe this financial strength and balanced capital allocation will best reward our shareholders over time. Also positioned Peabody for the Anglo acquisition marking a deliberate progression in Peabody's financial and strategic [indiscernible] Looking ahead, Peabody's capital allocation will be heavily shaped by our pending acquisition.

As a reminder, we have structured the transaction with a combination of upfront, deferred and contingent payments.

From the acquired assets to self fund the transaction. And set up a higher baseline sustainable shareholder returns.

Let's now review the segment results. In the fourth quarter, Seaborn Thermal recorded $112,000,000 of adjusted EBITDA on margins of 36%.

Tons shipped were ahead of expectations and that was primarily due to higher than anticipated production at Wambo Underground. Seaborne thermal cost per ton remained stable with the third quarter beating expectations.

For the full year, Seaborn Thermo segment reported $430,000,000 of adjusted EBITDA, Shipments increased nearly 1,000,000 tons from 2023 and costs were down about $1 per ton. Resulting in EBITDA margins of 35%.

The segment generated over $350,000,000 of free cash flow. The Seaborn Met segment reported $23,000,000 of adjusted EBITDA in the fourth quarter.

Shipments increased 500,000 tons compared to the third quarter in line with expectations. Cost per ton improved at Shoal Creek, as well as a weaker Australian dollar. Was partly offset by lower production at Capabella.

Average realized price was down about $21 per ton compared to last quarter, due to a higher mix of Shoal Creek sales.

We also saw benchmark prices for PCI and high vol A coals each down about $15 a ton quarter over quarter.

For the full year, the Seaborne Met segment reported $43,000,000 of adjusted EBITDA, Shipments increased 400,000 tons year over year to 7,300,000 segment achieved EBITDA margins of 15% a favorable result considering that market prices pushed realizations down $44 per ton in the year.

Switching to U. S. Thermal.

The mines generated $93,000,000 of adjusted EBITDA in the fourth quarter and that resulted in $72,000,000 of free cash flow.

PRV mines shipped 23,000,000 tons, well ahead of expectations. Continued operational discipline kept costs at $11.5 per ton, the same as last quarter and that let us maintain the same 17% margins in the fourth quarter and generate $53,000,000 of adjusted EBITDA.

The other U. S. Thermal mines delivered $41,000,000 of adjusted EBITDA In the Midwest, we reached contractual agreements with certain customers to offset lower twenty twenty four shipments. Production was 200,000 tons less than expected as the previously disclosed geological conditions at 20 mile required us to step the longwall around a rock lens. We've turned the corner on that issue. And longwall production recently resumed. With the mindset for a strong twenty twenty five. Together, The U. S. Thermal mines produced $289,000,000 of adjusted EBITDA in 2024, and required just $54,000,000 of capital resulting in $235,000,000 of free cash flow.

The last comment I'll make on Q4 results relates to other operating costs. We recorded a $41,000,000 non cash charge for the remeasurement of our Australian balance sheet at year end due to a lower A dollar exchange rate. The weaker Australian dollar benefited operating costs throughout the quarter, providing a bit of a built in natural hedge to earnings. [indiscernible] throughout the quarter, the period end remeasurement resulted in a significant net negative impact to Q4 EBITDA. Looking ahead to 2025, I'll briefly review guidance for the full year. We see that some analysts are including the Anglo acquisition their 2025 estimates for Peabody Peabody. But our guidance excludes contributions until the transaction is complete. This year, Seaborn thermal volumes are expected to be lower than 2024 due to reduced production at Wilpinion. And the closing of the Wambo Underground mine mid year, which will be partly offset by higher production from Lambo's surface operations. Additionally, domestic cost plus sales requirement are down another 400,000 tons in 2025, allowing us to achieve export pricing on that volume. Shipments are targeted to be 14,700,000 tons including 9,300,000 export tons.

Are projected to be consistent with 2024 levels at $47 to $52 per ton. Seaborne metallurgical volumes are projected to increase over 1,000,000 tons to 8,500,000 primarily due to higher volume at Shoal Creek and the continued ramp up at Centurion. This occurs even as we work through the high wall stability challenges at Capabella as we reconfigure the mine for an optimal long term solution. Segment costs are targeted at 120 to $130 per ton in line with last year. In the PRB, we are forecasting shipments between 150,000,000 tons. And currently have 71,000,000 tons priced at $13.85 Costs are expected to remain mostly flat with twenty twenty four levels at $12 to $12.75 per ton.

Other U. S. Thermal volumes are expected to be about 14,000,000 tons. We have 13,600,000 tons priced at $52 expect costs in the range of $43 to $47 per ton. Consistent with last year. Total capital expenditures for 2025 are estimated at $450,000,000 including $280,000,000 in project capital primarily for the continued development of Centurion.

In summary, we delivered on our 2024 goals. Remain committed to financial discipline and growing free cash flow per share. 2025 promises to be a busy year that will be shaped by the Anglo acquisition Advancing Centurion, and U. S. Policy. For more on that, I'll turn the call back to Jim.

Thanks, Mark. I'll turn briefly to Peabody's main focus areas for the New Year.

It's fair to say that we begin 2025 with an ambitious agenda.

Our first focus is an every year item the relentless pursuit of safe productive and environmentally sound operations Our second focus this year is to continue to ramp up the Flag mine on time and on budget I'm pleased to report that development is running ahead of schedule and all systems are go for our planned longwall startup early next year. Our third priority is to complete our premium heart coking coal acquisition which together with Centurion will transform Peabody's product and financial profile.

Priority number four is to serve growing Asian thermal coal demand through our low cost Australian export platform with longer term mine extensions teed up It's no surprise that the International Energy Agency recently report the world used a record amount of coal 8,770,000,000 metric tons representing more than one ton for every man, woman and child on earth. IEA also projects that global coal use will continue to grow for the next several years. Our fifth priority is to leverage our low cost U. S. Coal production to capitalize on emerging favorable policy and commercial themes and that dynamic continues to unfold as we speak. And finally, we work every day to enhance long term cash flow per share creation.

While the actions we're undertaking today enhancing our shareholder value proposition in three areas: earnings growth, Sustainable shareholder returns and multiples expansion over time.

And it's fair to say that our share price is reflecting none of the potential uplift in valuation from our recent actions. I've never been more optimistic about the prospects for Peabody and look forward to seeing those positive actions translate into tangible share price as we continue to execute [indiscernible] we're now ready to take questions.

We will now begin the question and answer session. First question Please go ahead.

Thank you, operator. Good morning, everyone. My first question is around the preemption rights process. I was wondering if you could add any color around what those conversations have looked like and I had the same question for any potential stake sale. Is there a preference for incremental stakes in the Anglo assets versus any stake at Centurion?

Thank you very much. Hey, Nick. Good morning. Jim Grech here.

On the preemption question that is part of any sales process, it's a typical contract term when you have joint venture partners.

It's progressing well. The timeline for the deadlines on it is sometime in mid March. We expect that to that deadline to come and pass and we'll move forward with the closing of the transaction.

On the asset sales, could you again ask that question again, so I'm sure we respond to it correctly?

Yes. Thanks, Jim. That's very helpful. And just on the asset sales, I was wondering if there would be a preference for additional stakes at the Anglo assets versus one at Centurion? Nick, we would if anybody if the discussions lead to fair value, full value offers on the asset sales, we'd look at some minority sales in those assets, whether it's with the the Anglo assets or Centurion. So we are anticipating that to be part of the financing process that we have here for for the acquisition and some of those steps have been undertaken already. And but it's too early to call what if any would be the results of that Got it. Jim, that's very helpful.

Shifting gears, MET guidance of 8,500,000 tons at the midpoint. I assume around 500,000 tons could come from Centurion, but how should we think about bridging from the 2024 level to 2025 guidance? And And then similarly on the cost side, costs are up at the midpoint versus 2024. So how should we how should we upbridge those as well?

You very much. Good morning, Nick, and welcome to the call I read your note this morning and you looked like your model was perfect. So congratulations. I think you're doing a better job than Lucas already in your first call. And I say that tongue in cheek, I'm sure Lucas is listening in. So answer your question on Seaborne Met, you're right, we're up up over 1,000,000 tons and about 400,000 to 500,000 more year over year as at Centurion. Shoal Creek is also up about hundred thousand tons. So that's the delta there. As far as costs, go, we are forecasting $120,000,000 to 130 full year $2,024,000,000 dollars was $123,000,000 so pretty consistent. I'd say there's two things that may lead it to be a bit higher and that is one, As I mentioned in my remarks, we're resetting Capella for optimal long term solution. We're going to be moving more waste about 6,000,000 bank cubic meters more year over year. And don't forget, we had a pretty weak in 2024. Mark, I appreciate all the color. To you and the team continue best of luck. Thank you. Next question comes from Nathan Martin with The Benchmark Company.

Please go ahead.

Thanks, operator. Good morning, everyone.

Good morning, Nate.

Maybe just one more question on the Engle acquisition. You guys mentioned several regulatory approvals have come already. What's left anything there from the standpoint that could hold you guys up beyond that targeted 2Q closing? And Nate, we've had some in and the rest are in process. And the various international ones and I think we have one left in Australia.

The initial indications is everything is going just fine with them. And the timing on those regulatory approvals is anywhere from later in February to maybe March, April. So it spans that timeframe. So just like with the preemptions, we just got to work through the process. There's a timeframe involved. We're stepping through it and right now everything looks looks good to us, Nate.

That sounds good, Jim. And then maybe coming back to the preemtions or really just the minority interest sales. Does your preference change at all? Or how should we think about the balance between minority interest sales and debt for the transaction.

So I'll just have a comment on the sales process and then I'll let Mark get to some of the details. But as I said, we started the beginning of looking at potential minority sales physicians in the Anglo assets and Centurion And we've had some very robust interest in in the assets coming from many different different sectors in The U. S, Australia and international. So again, I'm not going to sit here and predict what's going to happen everything is in negotiation, but I will say that it's been very robust interest at the beginning here of this process.

Nate, not a lot has changed from when we announced the transaction and our plans for the permanent financing. The $1,700,000,000 upfront payment we expect to be funded primarily with debt, the lion's share being high yield secured notes, We've talked about the project level equity, the minority stake sales as being another key option there. And as Jim mentioned, those discussions are underway. The timing as well as Magna And then lastly, we potentially round out with convertible notes or other financing. So not a lot has changed. I will say that that process is underway. It's going well in the early stages. There's strong inbound interest. We continue to test market capacity and we're highly confident that we'll arrange the financing along the lines we originally announced.

And Mark, any commentary around potentially needing to issue common equity? I know that's a question investors are focused on.

Yes. I'd probably I'd echo Jim's comments that reflect our belief that a lot of the value in Peabody and the pending acquisition are not currently reflected in our share price. Unfortunately, we don't get to pick the time when these types of assets become available. And we recognize spot coal prices are down, but we didn't buy these multi decade assets for short term changes in spot prices. Which can influence the coal equities. Our number one goal remains to enhance shareholder value and you do that by increasing free cash flow per share. We simulate free cash flow out of the acquisition, our P50 case without Grosvenor results in in over $800,000,000 of free cash flow in the initial five years after all of the deferred and price contingent consideration. Effectively paying one half of that initial consideration off leaving us with a very manageable permanent debt slice of the capital stack. And a significantly higher free cash flow base to provide sustainable shareholder returns. So we recognize the need to appreciate the volatility in seaborne coal prices and remain prudent to ensure financial resiliency throughout the price cycle so we can execute the strategy. Coal equities have all traded down since the announcement.

And we're going to take a good hard look at it. It's the last on our priority list.

But we have all the tools in the kit and continue to assess what the market will provide.

Great. Appreciate those thoughts guys. And then maybe just one final, but to leave Malcolm out. I know you touched on this briefly in your prepared remarks, but coming back to China's new 15% tariff on U. S. Coal imports, obviously, the bulk of Peabody's export sales come from Australia, but how do you see that tariff potentially impacting your business as well as the seaborne markets in general?

Yes, look, one thing with the markets is they're a little bit like a balloon. If you push some And so U. S. Exports are getting pushed here in terms of their price competitiveness into Asia. And for us, we've got about 600,000 tons of product that went to China last year. And that would mean that if we did nothing and continued supplying to China, we'd have a 15% lower price. And it really doesn't help when that's the clearing level and that's your alternative because other customers now when you look to sell to them in Asia, we'll be looking at at what that alternative is. It's positive for Australia.

In the sense that Australia becomes more and more competitive in Asia, which is the growth base for met coal demand. But for us, it's probably not such a big issue. I would have liked not to have seen this happen. But look, the markets will readjust, maybe may be more product go to S. Product go to India. And more Australian product go to China to balance that out. Or more U. S. Product to Europe, and and less Australian products to Europe. The market will work that out. But to deal with that, we need some price signals. And the price signals to make that readjustment could be a little bit painful in terms of our Shoal Creek returns over the next quarter or so. But look, let's wait and see how it all plays out. But hopefully, that's given you my perspective on it. That's great. And just to clarify, Mal, from the 600,000 tons to China, is that from Shoal Creek you're referring to specific Yes, that's Shop Creek.

Okay. Got it. Appreciate the time guys and best of luck in 2025. Thanks, Nate. Next question comes from Katya Janczyk with BMO Capital Markets.

Please go ahead.

Hi. Thank you for taking my questions. Maybe going back to the [indiscernible] Can you talk a bit more about how much Capabella is negatively impacting costs? Because I would assume with production higher, in general and medical prices lower the cost should still be trending more positively or lower?

Katya, two things. One, Q1, we're guiding a little bit higher than the full year on a ratable basis. Q4, we turned in much better than expected and [indiscernible] a longwall move at Shoal Creek, so a little bit higher than ratable in Q1. For the full year, we've put our guidance at $120,000,000 to $130,000,000 dollars 2024 came in at $123,000,000 As I mentioned before, it's really just moving those additional 6,000,000 BCMs and really weak A dollar throughout 2024, particularly in the back half of the year, that's driving the difference. Otherwise, we see them pretty consistent. [indiscernible] we don't see any significant inflation or other issues. So Does that help?

No, that's helpful. Thank you. And then maybe there were some reports that Doll Rental Port was impacted by weather Are you seeing any impact from that year quarter to date And is are there any issues with production given the weather? Currently in Australia?

Hi, Kasia. Malcolm here. Luke, this is pretty normal. Monsoonals, trough has come over Queensland probably ten days ago. And moved from the North Of Queensland to the South. And so over the past week, Darryl Pool Bay has received around 400 millimeters of of rain and most of the rain has remained coastal. What that means is that the ability to stack coal or reclaim coal when it's very wet with rain is very limited. So there has been outages at the port. And there has been like a let's call it a seven day interruption. But I view that as very short term. Terms of our mines, we've had a little bit of seasonal rain there, but nothing that's created a remarkable interruption at this stage.

Okay. Thank you.

Our next question comes from Chris La Femina, with Jefferies. Please go ahead.

Thanks, operator. Hey, guys. Thanks for taking my question. So I wanted to ask about the thermal coal segments. If we look at the 2025 guidance, it's basically lower volumes and probably lower margins mean, costs are flattish and prices are going to be down. I think in the peer to be actually expected to be up. But I wanted to kind of understand where where the Thermal segments will be heading after 2025. So it's helpful that we have given us that whole guidance for 2026 on costs and obviously on volumes as well. But thermal coal heading because seaborne thermal volumes have been heading lower, PRB obviously heading lower. And it's hard to offset the negative impact of fixed cost leverage when you declining volume. So we're looking at thermal coal business that's going to have a flat to rising cost base and declining volumes and then EBITDA growth without prices going up?

Yes, Chris. I'll comment on The U. S. Platform and then Mark and maybe Malcolm can give you some some comments on the Australian platform.

On The U. S. Platform, the PRB tonnages, we have the ability to move those tons up and down. And some of the forecasts that you see Maybe we're pre all of the momentum we're getting currently here.

Within the last few months in The U. S. Market.

With the Trump administration the strong push for reliability and keeping coal plants open, the load growth And so, in The U. S, if the market demands are there, which we think those tailwinds are certainly getting much, much stronger, We can certainly respond with the with the tonnages in the PRB. Of course, we'll also maintain some pricing to [indiscernible] on The U. S, I would say the tenanted that you see any decreases made are based on market assumptions and not not the physical asset base. [indiscernible] with that, I'll let the other guys talk about the Australian platform some.

Yes. Good morning, Chris. Just briefly on 200,000 tons forward to Wambo Underground in the fourth quarter and really beating Seymour and Thermal in the fourth quarter.

We've already announced that that underground will cease stop operations mid year. So we're going to be down about 800,000 tons year over year at the Wambo Underground for comparison purposes. And Wilpin Young is declining as well about 1,400,000 tons, partially offset by the Wambo open cut, which we expect to be up 10% maybe another 300,000 tons there. So that's really the delta year over year. And going forward, we haven't provided any guidance beyond 2025 except for what we anticipate from the acquisition. Just to put a marker out there. So we haven't given any Peabody guidance We've talked about this in the past. The Wilpinion production continues to decline until we open up Pit 9 And 10 an extension a few years out. [indiscernible] along with that is a continued decline in the domestic ton requirements. So I think this year we're probably looking at a net little over 5,000,000 tons of export out of Wilpin Young. And I think over the next five years, You're going to see something pretty close to that, about 4.8 to five on average. So I really see that being pretty consistent. And then as Jim mentioned, The U. S. Piece is really just demand driven.

Okay. Thanks for that. And just secondly on Grover, I think Anglo has some comments this morning about having put some cameras down in the mine and they saw limited damage, which is pretty encouraging actually. And I think it seems like there's potential for that to maybe come online a bit sooner than people had expected based on what's been discovered so far. Just could you comment on your understanding of what's happening there and what your thought is about the potential restart for that asset in terms of timing, etcetera.

Yes, Chris, we that's encouraging news to hear. That you just mentioned about [indiscernible] we're really not in a good position to start putting out estimates of when we'll open that mine back up and the costs to do that until we get ownership of can really see the conditions firsthand.

So I will say that we do have optimism that we'll be able to do that based on what we've been able to do with the Centurion mine. The experience we have and the work we have with the regulators we certainly are well positioned to bring that mine back online, but we're not in a point at what we're going to start giving out estimates on timeline or costs or anything. It's just a little too early for us because we just don't have enough information to do that yet.

Understood. Thank you and good luck.

Thank you.

Next question is a follow-up from Nick Giles, please go ahead. Thank you very much, operator.

Mark, maybe in response to your earlier comments, you outperformed my model pretty meaningfully in the PRB. So I'm sure Lucas took notice of that. But wanted to come back to Shoal Creek.

It seems like production was stronger there, but wanted to get your take on kind of where realizations are today And maybe bigger picture, where does this asset fit in your portfolio longer term? And [indiscernible] a sale of the asset be an additional lever you could pull in the case of permanent financing? I'll start and then maybe Malcolm can talk about realizations a bit more. But yes Shoal Creek is really operating extremely well Did a great, great year. We expect even better things in 2025 as I noted earlier. So operationally, it's hitting on all cylinders. Doing absolutely everything that we anticipated they would do with the new longwall kit. Realizations have been a bit of a challenge but maybe, Malcolm, you want to add a little color to that? [indiscernible] last call, I did give a sort of a breakdown as to where those Asian realizations are. And obviously, with Europe not as strong for us, At the moment, a lot of our returns are coming from Asia.

And at the moment, to be honest, you're talking an FOB return on a short term basis of somewhere between $120 and $130 for that greater product. That's where the price point is if you're selling into Asia.

Appreciate the color. Thank you.

The next question is from Matt Warder with the coaltrader.com. Please go ahead.

Hey, guys. Hope all is well over there. I actually had a follow-up question to Nick, who basically stole most of my thunder there.

The realizations for Shoal Creek, is that basically just getting whacked due to the freight differential over to Asia? Is that the culprit there? [indiscernible] there's two things. If you look at the top CSR coal, our CSR coal, we're talking about those being at around $180 FOB in Australia, And now when we talk about closer to 60 CSR type goals, which Shoal Creek is, their returns are about $150 FOB metric.

You have to take a freight differential off that and convert it to short tons. And that's how I get to my $120,000,000 to $130,000,000 Okay. That's all good.

Also with regard to the guidance, how are you guys looking at semi soft and PCI realizations in 2025 this year? Any color on that would be really helpful.

Yes. So within the existing Peabody portfolio, we don't really sell into the semi soft market. But what I can and I would like to talk about the semi soft market because That market is quite long at the moment, particularly out of Newcastle.

So it's been a swing to Quentin Semi Softs. And So That's Part Of What's Happening With Newcastle returns. So there's a lot of that what used to be that lower semi soft products now coming back into thermal. So we think about Newcastle thermal, that's the challenge there. So yes, semi stock quite challenged. In Europe, there's been in Poland, there's been a couple of outages. Which we've seen some semi soft demand come out of there, but really semi soft is quite weak. But when it comes to PCI, there's two types of PCI. There's low vol PCI, high quality PCI coming from mines such as Copa Del Amorba. And then there's byproduct PCIs which tend to be higher in volatile manner. So when you come to that premium low vol category, we see that as really quite short. And challenged and the like. And we probably see the relative price point at over 80% for that coal. At the moment relative to prime low gold hot coke in coal. Got you. That's pretty helpful. If I could switch gears for a second, I think it was Jim had a comment about receiving inbounds from PE firms about basically power for data centers.

Is that something you guys are pursuing at all at this point? I know it was kind of discussion point with Thomas for a while there. Is that the just wondered how you guys are thinking about that at this point in time?

Well, Matt, first off, welcome to our earnings call. We appreciate the interest and the questions and from yourself. Thank you for that. Secondly, we are getting inbounds [indiscernible] companies that are trying to figure out how to serve this growing growing electrical load demands and do it reliably. And so people are looking at coal plants and then if they're looking at coal plants, they want to know that it has long term supply to those coal plants. So with the long life and low cost reserves, we are people naturally come to us and ask us if there's if there's anything that we can work together, things that we would do, would we supply that, would we participate in that So we are getting those inbounds. It certainly picked up with the Trump administration and their favorable stance towards coal. I wouldn't say there's anything imminent or breaking on that, but from a few months ago where we had none of that type of interest coming in or almost none It's been noticeably increased here in the recent month or two.

Now that's interesting. I mean, I think that's something that the whole industry could take advantage of. Going forward. I did have one last question which pertains to the Anglo assets, specifically their CapEx. If I recall correctly from the presentation, I think you're targeting couple hundred million dollars per year in CapEx for the first two or three years and then it goes to a maintenance CapEx level of like 150, like $13 per clean ton. Am I thinking about that right? And if so, what's the elevated level in the first couple of years? What was that being put toward? Matt, you got that exactly right. Those are the numbers [indiscernible] the initial couple of years being higher is really due to some of the objectives we have to get that production levels up to what we have forecasted. There's a new longwall obviously, in Morimba North, which is a big part in 2026. We also talked about some fleet enhancements at Cap Colon etcetera. So there's handful of things getting both the North And South District going to Moranbah North, walk on walk off capabilities, that kind of stuff. And there's those types of things. And then we do see that leveling out to about 150 on our on an average basis going forward for I think we looked at it in the model probably for the next 10 on a sustainable basis.

Okay. That's great. I think that's all I have here right now, but I'll turn it back over. Thanks a lot for the color guys.

You bet, Matt. Thank you.

This concludes our question and answer session. I would like to turn the conference back over to Jim Grek for any closing remarks.

Thank you, operator, and thank you all for time today also like to express my gratitude to the BBUDD team for the many excellent we had in 2024 and we're planning a highly productive next several months. So we look forward to keeping everyone apprised our progress Thank you.