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What changed in PEABODY ENERGY CORP's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of PEABODY ENERGY CORP's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+597 added−688 removedSource: 10-K (2024-02-23) vs 10-K (2023-02-24)

Top changes in PEABODY ENERGY CORP's 2023 10-K

597 paragraphs added · 688 removed · 450 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

151 edited+50 added−70 removed171 unchanged
Biggest changeThermal Mining Bear Run Indiana S DL, D, T/S T Tr, R, EV Yes 6.7 6.0 5.2 El Segundo/Lee Ranch New Mexico S DL, D, T/S T R No 3.7 3.7 4.6 Gateway North Illinois U CM T Tr, R, R/B, T/B, EV Yes 2.4 1.8 1.8 Wild Boar Indiana S HW, DL, D, T/S T Tr, R, R/B, T/B Yes 2.3 2.4 2.0 Francisco Underground Indiana U CM T R Yes 1.8 1.5 1.6 Twentymile Colorado U LW T R, Tr, EV Yes 1.5 1.7 1.2 Somerville Central (6) Indiana S DL, D, T/S T R, R/B, T/B, T/R No — — 0.4 Legend: S Surface Mine B Barge U Underground Mine Tr Truck HW Highwall Miner R/B Rail to Barge DL Dragline T/B Truck to Barge D Dozer/Casting T/R Truck to Rail T/S Truck and Shovel EV Export Vessel LW Longwall T Thermal/Steam CM Continuous Miner C Coking R Rail P Pulverized Coal Injection (1) In December 2020, the United Wambo Joint Venture, an unincorporated joint venture between Peabody and Glencore plc, began joint production.
Biggest changeThermal Bear Run Indiana S DL, D, T/S T Tr, R, EV Yes 5.5 6.7 6.0 El Segundo/Lee Ranch New Mexico S DL, D, T/S T R No 3.4 3.7 3.7 Gateway North Illinois U CM T Tr, R, R/B, T/B, EV Yes 2.5 2.4 1.8 Francisco Underground Indiana U CM T R Yes 2.0 1.8 1.5 Wild Boar Indiana S HW, DL, D, T/S T Tr, R, R/B, T/B Yes 1.9 2.3 2.4 Twentymile Colorado U LW T R, Tr, EV Yes 1.3 1.5 1.7 Legend: S Surface Mine B Barge U Underground Mine Tr Truck HW Highwall Miner R/B Rail to Barge DL Dragline T/B Truck to Barge D Dozer/Casting T/R Truck to Rail T/S Truck and Shovel EV Export Vessel LW Longwall T Thermal/Steam CM Continuous Miner C Coking R Rail P Pulverized Coal Injection (1) Peabody owns a 50% undivided interest in an unincorporated joint venture that owns the Wambo Open-Cut Mine.
Peabody actively seeks employees' feedback, including through surveys and focus groups on its employee value proposition. The typical Peabody employee has approximately seven years of experience with the company, and more than 47% of all Peabody employees remain employed with the company for more than five years.
Peabody actively seeks employees' feedback, including through surveys and focus groups on its employee value proposition. The typical Peabody employee has approximately seven years of experience with the company, and approximately 47% of all Peabody employees remain employed with the company for more than five years.
The State of New South Wales (NSW) enacted the Energy and Utilities Administration Amendment Act 2022 granting the State Premier and Minister for Energy the ability to issue directions in the event of a coal market price emergency (among other powers).
New South Wales Coal Directions . The State of New South Wales (NSW) enacted the Energy and Utilities Administration Amendment Act 2022 granting the State Premier and Minister for Energy the ability to issue directions in the event of a coal market price emergency (among other powers).
(7) Peabody owns a 50% equity interest in Middlemount, which owns the Middlemount Mine. Because Middlemount is accounted for as an unconsolidated equity affiliate, the table above excludes tons produced from that mine, which totaled 1.4 million, 2.0 million and 1.6 million tons, respectively (on a 50% basis). Refer to the Reserves and Resources tables within Item 2.
(6) Peabody owns a 50% equity interest in Middlemount, which owns the Middlemount Mine. Because Middlemount is accounted for as an unconsolidated equity affiliate, the table above excludes tons produced from that mine, which totaled 1.2 million, 1.4 million and 2.0 million tons, respectively (on a 50% basis). Refer to the Reserves and Resources tables within Item 2.
Changes in listings or requirements under these regulations could have a material adverse effect on Peabody’s costs or its ability to mine some of its properties in accordance with its current mining plans. During the Trump Administration, the Departments of the Interior and Commerce issued finalized five rules aiming to streamline and update the ESA.
Changes in listings or requirements under these regulations could have a material adverse effect on Peabody’s costs or its ability to mine some of its properties in accordance with its current mining plans. During the Trump Administration, the Departments of the Interior and Commerce finalized five rules aiming to streamline and update the ESA.
Hathhorn held various leadership positions with Drummond LTD in South America, including Mine Operations Superintendent, Port Manager, and Vice President - Mining Operations. Prior to joining Drummond LTD, Mr. Hathhorn held various engineering and supervisory positions with Newmont Gold Corporation. Mr. Hathhorn holds a Bachelor of Science Degree in Mining Engineering from the University of Idaho, College of Mines.
Hathhorn held various leadership positions with Drummond LTD in South America, including Mine Operations Superintendent, Port Manager, and Vice President - Mining Operations. Prior to joining Drummond LTD, Mr. Hathhorn held various engineering and supervisory positions with Newmont Mining Corporation. Mr. Hathhorn holds a Bachelor of Science Degree in Mining Engineering from the University of Idaho, College of Mines.
Peabody has secured its ability to transport coal from its Shoal Creek Mine under barge and port contracts; the primary port is the McDuffie Terminal in Mobile, Alabama, which the Company utilizes without a take-or-pay arrangement. Peabody’s U.S. thermal mining operations exported less than 1% of their annual tons sold during both the years ended December 31, 2022 and 2021.
Peabody has secured its ability to transport coal from its Shoal Creek Mine under barge and port contracts; the primary port is the McDuffie Terminal in Mobile, Alabama, which the Company utilizes without a take-or-pay arrangement. Peabody’s U.S. thermal operations exported less than 1% of their annual tons sold during the years ended December 31, 2022 and 2021.
Trade flow disruptions have occurred during 2022 related to China’s unofficial ban on Australian coal and sanctions imposed on Russian coal imports. Major international direct competitors (listed alphabetically) include Anglo American; Arch Resources, Inc.; BHP; Foxleigh; Glencore; Jellinbah; KRU; Stanmore; Teck Resources; Warrior Met Coal; Whitehaven Coal Limited; and Yancoal Australia Ltd, among others.
Trade flow disruptions occurred during 2022 and 2023 related to China’s unofficial ban on Australian coal and sanctions imposed on Russian coal imports. Major international direct competitors (listed alphabetically) include Anglo American; Arch Resources, Inc.; BHP; Foxleigh; Glencore; Jellinbah; KRU; Stanmore; Teck Resources; Warrior Met Coal; Whitehaven Coal Limited; and Yancoal Australia Ltd, among others.
The CWA of 1972 directly impacts U.S. coal mining operations by requiring effluent limitations and treatment standards for wastewater discharge from mines through the National Pollutant Discharge Elimination System (NPDES). Regular monitoring, reporting and performance standards are requirements of NPDES permits that govern the discharge of water from mine-related point sources into receiving waters. The U.S.
The CWA of 1972 directly impacts U.S. coal mining operations by requiring effluent limitations and treatment standards for wastewater discharge from mines through the National Pollutant Discharge Elimination System (NPDES). Regular monitoring, reporting and performance standards are requirements of NPDES permits that govern the discharge of water from mine-related point sources into jurisdictional waters. The U.S.
“Properties,” which is incorporated by reference herein, for additional information regarding coal reserves and resources, and product characteristics associated with each mine. Peabody Energy Corporation 2022 Form 10-K 5 Table of Contents Coal Supply Agreements Customers. Peabody’s coal supply agreements are primarily with electricity generators, industrial facilities and steel manufacturers.
“Properties,” which is incorporated by reference herein, for additional information regarding coal reserves and resources, and product characteristics associated with each mine. Peabody Energy Corporation 2023 Form 10-K 5 Table of Contents Coal Supply Agreements Customers. Peabody’s coal supply agreements are primarily with electricity generators, industrial facilities and steel manufacturers.
On March 21, 2022, the SEC proposed rules that would require public companies to disclose extensive climate-related information in certain SEC filings.
SEC Climate-Related Disclosures . On March 21, 2022, the SEC proposed rules that would require public companies to disclose extensive climate-related information in certain SEC filings.
While stormwater collected at the mine site is managed through two sedimentation dams, at times the heavy rainfall has presented challenges with managing the significant volumes of stormwater, as the surface water management infrastructure has not had sufficient capacity. As a result, on multiple occasions throughout 2021 and 2022 stormwater has been discharged from the mine site.
While stormwater collected at the mine site is managed through two sedimentation dams, at times the heavy rainfall presented challenges with managing the significant volumes of stormwater, as the surface water management infrastructure has not had sufficient capacity. As a result, on multiple occasions throughout 2021 and 2022 stormwater was discharged from the mine site.
In August 2019, Peabody and Glencore received approval from the NSW Independent Planning Commission (IPC) for the United Wambo project, subject to conditions (Export Conditions) requiring the joint venture to prepare an Export Management Plan setting out protocols for using all reasonable and feasible measures to ensure that any coal extracted from the mine that is to be exported from Australia is only exported to countries that are parties to the Paris Agreement (as defined below) or countries that the NSW Planning Secretary considers to have similar policies for reducing greenhouse gas emissions.
In August 2019, Peabody and Glencore received approval from the NSW Independent Planning Commission (IPC) for the United Wambo project, subject to conditions (Export Conditions) requiring the joint venture to prepare an Export Management Plan setting out protocols for using all reasonable and feasible measures to ensure that any coal extracted from the mine that is to be exported from Australia is only exported to countries that are parties to the Paris Agreement (as defined below) or countries that the NSW Planning Secretary considers to have similar policies for reducing GHG emissions.
Information About Our Executive Officers Set forth below are the names, ages and positions of Peabody’s executive officers. Executive officers are appointed by, and hold office at the discretion of, Peabody’s Board of Directors, subject to the terms of any employment agreements. Name Age (1) Position (1) James C. Grech 61 President and Chief Executive Officer Mark A.
Information About Our Executive Officers Set forth below are the names, ages and positions of Peabody’s executive officers. Executive officers are appointed by, and hold office at the discretion of, Peabody’s Board of Directors (the Board), subject to the terms of any employment agreements. Name Age (1) Position (1) James C. Grech 62 President and Chief Executive Officer Mark A.
Army Corps of Engineers (Corps) regulates certain activities affecting navigable waters and waters of the U.S., including wetlands. Section 404 of the CWA requires mining companies to obtain permits from the Corps to place material in or mine through jurisdictional waters of the U.S. States are empowered to develop and apply water quality standards.
Army Corps of Engineers (Corps) regulates certain activities affecting navigable waters and waters of the U.S., including wetlands. Section 404 of the CWA requires mining companies to obtain permits from the Corps to place dredged or fill material in or mine through jurisdictional waters of the U.S. States are empowered to develop and apply water quality standards.
The Clean Air Act contains a national visibility goal for the “prevention of any future, and the remedying of any existing, impairment of visibility in Class I areas which impairment results from manmade air pollution.” The EPA promulgated comprehensive regulations in 1999 requiring all states to submit plans to address regional haze that could affect 156 national parks and wilderness areas, including requirements for certain sources to install the best available retrofit technology and for states to demonstrate “reasonable progress” towards meeting the national visibility goal.
The CAA contains a national visibility goal for the “prevention of any future, and the remedying of any existing, impairment of visibility in Class I areas which impairment results from manmade air pollution.” The EPA promulgated comprehensive regulations in 1999 requiring all states to submit plans to address regional haze that could affect 156 national parks and wilderness areas, including requirements for certain sources to install the best available retrofit technology and for states to demonstrate “reasonable progress” towards meeting the national visibility goal.
Item 1. Business. Overview Peabody is a leading producer of metallurgical and thermal coal. At December 31, 2022, the Company owned interests in 17 active coal mining operations located in the United States (U.S.) and Australia, including a 50% equity interest in Middlemount Coal Pty Ltd. (Middlemount).
Item 1. Business. Overview Peabody is a leading producer of metallurgical and thermal coal. At December 31, 2023, the Company owned interests in 17 active coal mining operations located in the United States (U.S.) and Australia, including a 50% equity interest in Middlemount Coal Pty Ltd. (Middlemount).
Peabody Energy Corporation 2022 Form 10-K 6 Table of Contents The Company believes it has good relationships with U.S. and Australian rail carriers and port and barge companies due, in part, to its modern coal-loading facilities and the experience of its transportation coordinators.
Peabody Energy Corporation 2023 Form 10-K 6 Table of Contents The Company believes it has good relationships with U.S. and Australian rail carriers and port and barge companies due, in part, to its modern coal-loading facilities and the experience of its transportation coordinators.
In the U.S., natural gas is highly competitive (along with other alternative fuel sources) with thermal coal for electricity generation. The competitiveness of natural gas has been strengthened by accelerated growth in domestic natural gas production and new natural gas combined cycle generation capacity.
In the U.S., natural gas is highly competitive (along with other alternative fuel sources) with thermal coal for electricity generation. The competitiveness of natural gas has been strengthened by continued growth in domestic natural gas production and new natural gas combined cycle generation capacity.
Also shown are the primary ports that the Company uses for its coal exports and the Company’s corporate headquarters in St. Louis, Missouri. Peabody Energy Corporation 2022 Form 10-K 2 Table of Contents U.S.
Also shown are the primary ports that the Company uses for its coal exports and the Company’s corporate headquarters in St. Louis, Missouri. Peabody Energy Corporation 2023 Form 10-K 2 Table of Contents U.S.
Peabody Energy Corporation 2022 Form 10-K 7 Table of Contents Thermal Coal. Demand for Peabody’s thermal coal products is impacted by economic conditions; demand for electricity, which is impacted by energy efficient products; and the cost of electricity generation from coal and alternative forms of generation.
Peabody Energy Corporation 2023 Form 10-K 7 Table of Contents Thermal Coal. Demand for Peabody’s thermal coal products is impacted by economic conditions; demand for electricity, which is impacted by energy efficient products; and the cost of electricity generation from coal and alternative forms of generation.
In addition to its mining operations, the Company markets and brokers coal from other coal producers, trades coal and freight-related contracts, and, during 2022, partnered in a joint venture with the intent of developing various sites, including certain reclaimed mining land held by the Company in the U.S., for utility-scale photovoltaic solar generation and battery storage.
In addition to its mining operations, the Company markets and brokers coal from other coal producers; trades coal and freight-related contracts; and, since 2022, is partnered in a joint venture with the intent of developing various sites, including certain reclaimed mining land held by the Company in the U.S., for utility-scale photovoltaic solar generation and battery storage.
In December 2012, Australia signed on to the second commitment period. During the UNFCCC conference in Paris, France in late 2015, an agreement was adopted calling for voluntary emissions reductions contributions after the second commitment period ends in 2020 (the Paris Agreement).
In December 2012, Australia signed on to the second commitment period. During the UNFCCC conference in Paris, France in late 2015, an agreement was adopted calling for voluntary emissions reduction contributions after the second commitment period ends in 2020 (the Paris Agreement).
The new FA framework creates a pooled fund covering most mines and most of the total industry liability, plus other options for providing FA if not part of the pooled fund (for example, allowing insurance bonds or cash).
The new FA framework created a pooled fund covering most mines and most of the total industry liability, plus other options for providing FA if not part of the pooled fund (for example, allowing insurance bonds or cash).
Locations Peabody Energy Corporation 2022 Form 10-K 3 Table of Contents Australian Locations Peabody Energy Corporation 2022 Form 10-K 4 Table of Contents The table below summarizes information regarding the operating characteristics of each of the Company’s mines in the U.S. and Australia.
Locations Peabody Energy Corporation 2023 Form 10-K 3 Table of Contents Australian Locations Peabody Energy Corporation 2023 Form 10-K 4 Table of Contents The table below summarizes information regarding the operating characteristics of each of the Company’s mines in the U.S. and Australia.
He also previously held multiple financial positions at Newmont Mining Corporation, a leading gold and copper producer, First Data Corporation, a financial services company, and Deloitte LLP, an international accounting, tax and advisory firm. Mr. Spurbeck is a Certified Public Accountant and holds a Bachelor’s Degree in Accounting from Hillsdale College. Darren R.
He also previously held multiple financial positions at Newmont Mining Corporation, a leading gold and copper producer, First Data Corporation, a financial services company, and Deloitte LLP, an international accounting, tax and advisory firm. Mr. Spurbeck is a Certified Public Accountant (inactive) and holds a Bachelor’s Degree in Accounting from Hillsdale College.
Although the approval was refused for other reasons, the judge in that case discussed ‘Scope 3’ greenhouse gas emissions resulting from the consumption of coal to be mined under the proposed project. Such emissions are often raised as a ground of objection to Australian mining projects, including Peabody’s mining projects.
Although the approval was refused for other reasons, the judge in that case discussed ‘Scope 3’ GHG emissions resulting from the consumption of coal to be mined under the proposed project. Such emissions are often raised as a ground of objection to Australian mining projects, including Peabody’s mining projects.
Metropolitan Collieries Pty Ltd (MCPL), a wholly-owned subsidiary of Peabody, removed accumulated material from the sedimentation dams to restore full site stormwater capacity by December 31, 2022 and has identified and is implementing additional controls for the management of sediment moving forward.
Metropolitan Collieries Pty Ltd (MCPL), a wholly-owned subsidiary of PEC, removed accumulated material from the sedimentation dams to restore full site stormwater capacity by December 31, 2022 and identified and is implementing additional controls for the management of sediment moving forward.
Thermal Mining Operations. Revenue from Peabody’s Powder River Basin Mining and Other U.S.
Thermal Operations. Revenue from Peabody’s Powder River Basin and Other U.S.
This new law became effective July 1, 2020. The bill also introduced the requirement for statutory role holders to be employees of the coal mine operator entity with an 18-month transition period ending November 25, 2022. Industrial Relations .
This new law became effective July 1, 2020. The bill also introduced the requirement for statutory role holders to be employees of the coal mine operator entity with an 18-month transition period which ended November 25, 2022. Industrial Relations .
Peabody Energy Corporation 2022 Form 10-K 26 Table of Contents The Kyoto Protocol, adopted in December 1997 by the signatories to the 1992 United Nations Framework Convention on Climate Change (UNFCCC), established a binding set of GHG emission targets for developed nations. The U.S. signed the Kyoto Protocol but it has never been ratified by the U.S. Senate.
Peabody Energy Corporation 2023 Form 10-K 25 Table of Contents The Kyoto Protocol, adopted in December 1997 by the signatories to the 1992 United Nations Framework Convention on Climate Change (UNFCCC), established a binding set of GHG emission targets for developed nations. The U.S. signed the Kyoto Protocol but it has never been ratified by the U.S. Senate.
Refer to the section “Regulatory Matters — Australia” within this Item 1 for discussion of the proposed reform. Available Information Peabody files or furnishes annual, quarterly and current reports (including any exhibits or amendments to those reports), proxy statements and other information with the SEC.
Refer to the section “Regulatory Matters — Australia” within this Item 1 for discussion of the reforms. Available Information Peabody files or furnishes annual, quarterly and current reports (including any exhibits or amendments to those reports), proxy statements and other information with the SEC.
Over the past two years, there has been significantly high rainfall in New South Wales, including unprecedented rain totals at the Metropolitan Mine site.
Over the past few years, there has been significantly high rainfall in New South Wales, including unprecedented rain totals at the Metropolitan Mine site.
The Company is currently assessing the potential impact of the proposed rules. The public comment period on the proposed rules has concluded and final rules are expected in 2023. Inflation Reduction Act of 2022 . The Inflation Reduction Act of 2022 was signed into law on August 16, 2022.
The Company is currently assessing the potential impact of the proposed rules. The public comment period on the proposed rules has concluded and final rules are expected in April 2024. Inflation Reduction Act of 2022 . The Inflation Reduction Act of 2022 was signed into law on August 16, 2022.
Production Segment/Mining Complex Location Mine Type Mining Method Coal Type Primary Transport Method Processing Plants Year Ended December 31, 2022 2021 2020 Seaborne Thermal Mining (Tons in millions) Wilpinjong New South Wales S D, T/S T R, EV Yes 12.1 13.2 14.2 Wambo Open-Cut (1) New South Wales S T/S T, C R, EV Yes 2.0 2.4 4.0 Wambo Underground (2) New South Wales U LW T, C R, EV Yes 1.1 1.4 1.5 Seaborne Metallurgical Mining Coppabella (3) Queensland S DL, D, T/S P R, EV Yes 2.4 2.1 2.2 Metropolitan (4) New South Wales U LW C, P, T R, EV Yes 1.8 1.0 1.0 Moorvale (3) Queensland S D, T/S C, P, T R, EV Yes 1.5 1.3 1.2 Shoal Creek (5) Alabama U LW C B, EV Yes 0.8 0.1 0.6 Millennium (6) Queensland S HW C, P R, EV No — — 0.1 Middlemount (7) Queensland S D, T/S C, P R, EV Yes — — — Powder River Basin Mining North Antelope Rochelle Wyoming S DL, D, T/S T R No 60.4 62.8 66.1 Caballo Wyoming S D, T/S T R No 12.1 13.9 11.6 Rawhide Wyoming S D, T/S T R No 10.3 11.6 9.5 Other U.S.
Production Segment/Mining Complex Location Mine Type Mining Method Coal Type Primary Transport Method Processing Plants Year Ended December 31, 2023 2022 2021 Seaborne Thermal (Tons in millions) Wilpinjong New South Wales S D, T/S T R, EV Yes 12.0 12.1 13.2 Wambo Open-Cut (1) New South Wales S T/S T, C R, EV Yes 2.6 2.0 2.4 Wambo Underground (2) New South Wales U LW T, C R, EV Yes 1.2 1.1 1.4 Seaborne Metallurgical Metropolitan (3) New South Wales U LW C, P, T R, EV Yes 2.2 1.8 1.0 Coppabella (4) Queensland S DL, D, T/S P R, EV Yes 2.2 2.4 2.1 Moorvale (4) Queensland S D, T/S C, P, T R, EV Yes 2.2 1.5 1.3 Shoal Creek (5) Alabama U LW C B, EV Yes 0.6 0.8 0.1 Middlemount (6) Queensland S D, T/S C, P R, EV Yes — — — Powder River Basin North Antelope Rochelle Wyoming S DL, D, T/S T R No 62.0 60.4 62.8 Caballo Wyoming S D, T/S T R No 15.3 12.1 13.9 Rawhide Wyoming S D, T/S T R No 9.8 10.3 11.6 Other U.S.
The Henry Hub Natural Gas Prompt Price averaged $6.54 per mmBtu in 2022, versus $3.72 and $2.13 per mmBtu in 2021 and 2020, respectively. In addition, the competitiveness of other alternative fuel sources for electricity generation has been strengthened by the growth of renewable energy generation.
The Henry Hub Natural Gas Prompt Price averaged $2.66 per mmBtu in 2023, versus $6.54 and $3.72 per mmBtu in 2022 and 2021, respectively. In addition, the competitiveness of other alternative fuel sources for electricity generation has been strengthened by the growth of renewable energy generation.
Peabody endeavors to engage with its organized workforce and foster strong relationships with those organizations built on trust and communication. As of December 31, 2022, approximately 3,600 of Peabody’s employees are located in the U.S., with the remainder primarily located in Australia.
Peabody endeavors to engage with its organized workforce and foster strong relationships with those organizations built on trust and communication. As of December 31, 2023, approximately 3,500 of Peabody’s employees are located in the U.S., with the remainder primarily located in Australia.
Industry commercial practice, and Peabody’s typical practice, is to negotiate pricing for seaborne thermal coal contracts on an annual, spot or index basis and seaborne metallurgical coal contracts on a quarterly, spot or index basis. For its seaborne mining operations, the portion of sales volume under contracts with a duration of less than one year represented 41% in 2022. U.S.
Industry commercial practice, and Peabody’s typical practice, is to negotiate pricing for seaborne thermal coal contracts on an annual, spot or index basis and seaborne metallurgical coal contracts on a quarterly, spot or index basis. For its seaborne operations, the portion of sales volume under contracts with a duration of less than one year represented 30% in 2023. U.S.
The mines are listed within their respective reporting segment in descending order, as determined by tons produced in 2022.
The mines are listed within their respective reporting segment in descending order, as determined by tons produced in 2023.
The Company offers a variety of learning events, including mentoring and development programs to aid its employees in their career growth. During the past five years, approximately 27% of open positions and 64% of director and above positions have been filled by internal candidates through promotions and lateral career development opportunities.
The Company offers a variety of learning events, including mentoring and development programs to aid its employees in their career growth. During the past five years, approximately 25% of open positions and 60% of director and above positions have been filled by internal candidates through promotions or lateral career development opportunities.
In New South Wales, laws and regulations related to mining include, but are not limited to, the Mining Act 1992, Work Health and Safety (Mines) Act 2013, Coal Mine Subsidence Compensation Act 2017, Environmental Planning and Assessment Act 1979 (EPA Act), Environmental Planning and Assessment Regulations 2000, Protection of the Environment Operations Act 1997, Contaminated Land Management Act 1997, Explosives Act 2003, Water Management Act 2000, Water Act 1912, Radiation Control Act 1990, Biodiversity Conservation Act 2016 (BC Act), Heritage Act 1977, Aboriginal Land Rights Act 1983, Crown Land Management Act 2016, Dangerous Goods (Road and Rail Transport) Act 2008, Fisheries Management Act 1994, Forestry Act 2012, Native Title (New South Wales) Act 1994, Biosecurity Act 2015, Roads Act 1993 and National Parks & Wildlife Act 1974.
Peabody Energy Corporation 2023 Form 10-K 18 Table of Contents In New South Wales, laws and regulations related to mining include, but are not limited to, the Mining Act 1992, Work Health and Safety (Mines) Act 2013, Coal Mine Subsidence Compensation Act 2017, Environmental Planning and Assessment Act 1979 (EPA Act), Environmental Planning and Assessment Regulations 2000, Protection of the Environment Operations Act 1997, Contaminated Land Management Act 1997, Explosives Act 2003, Water Management Act 2000, Water Act 1912, Radiation Control Act 1990, Biodiversity Conservation Act 2016 (BC Act), Heritage Act 1977, Aboriginal Land Rights Act 1983, Crown Land Management Act 2016, Dangerous Goods (Road and Rail Transport) Act 2008, Fisheries Management Act 1994, Forestry Act 2012, Native Title (New South Wales) Act 1994, Biosecurity Act 2015, Roads Act 1993 and National Parks & Wildlife Act 1974.
States are required to revise plans every 10 years. New Source Review (NSR). The Clean Air Act imposes permitting requirements when a new source undergoes construction or when an existing source is reconstructed or undergoes a major modification. These requirements are contained in the CAA’s PSD and Nonattainment New Source Review (NNSR) programs, generally referred to as NSR.
States are required to revise plans every 10 years. New Source Review (NSR). The CAA imposes permitting requirements when a new source undergoes construction or when an existing source is reconstructed or undergoes a major modification. These requirements are contained in the CAA’s PSD and Nonattainment New Source Review programs, generally referred to as NSR.
The NSW government has announced changes to the IPC and planning system process which aims to improve timeframes and efficiencies for project approvals and providing more clarity on the IPC’s role in determining applications including seeking guidance on government policy.
The NSW government has announced changes to the IPC and planning system process which aim to improve timeframes and efficiencies for project approvals and provide more clarity on the IPC’s role in determining applications including seeking guidance on government policy.
The Company recognized expense related to the fees of $21.7 million, $27.0 million and $28.4 million for the years ended December 31, 2022, 2021 and 2020, respectively. Clean Air Act (CAA) . The CAA, enacted in 1970, and comparable state and tribal laws that regulate air emissions affect the Company’s U.S. coal mining operations both directly and indirectly.
The Company recognized expense related to the fees of $22.2 million, $21.7 million and $27.0 million for the years ended December 31, 2023, 2022 and 2021, respectively. Clean Air Act (CAA) . The CAA, enacted in 1970, and comparable state and tribal laws that regulate air emissions affect the Company’s U.S. coal mining operations both directly and indirectly.
In November 2018, the Queensland government passed the Mineral and Energy Resources (Financial Provisioning) Act 2018 providing for a new financial assurance (FA) framework and new progressive rehabilitation requirements.
In November 2018, the Queensland government passed the Mineral and Energy Resources (Financial Provisioning) Act 2018 which provided for a new financial assurance (FA) framework and new progressive rehabilitation requirements.
Those five customers were supplied primarily from 16 coal supply agreements (excluding trading and brokerage transactions) expiring at various times from 2023 to 2025. Peabody’s largest customer in 2022 contributed revenue of approximately $358 million, or approximately 7% of Peabody’s total revenue from coal supply agreements, and has contracts expiring at various times from 2023 to 2024. Backlog.
Those five customers were supplied primarily from 13 coal supply agreements (excluding trading and brokerage transactions) expiring at various times from 2024 to 2025. Peabody’s largest customer in 2023 contributed revenue of approximately $341 million, or approximately 7% of Peabody’s total revenue from coal supply agreements, and has contracts expiring in 2024. Backlog.
Major international direct coal supply competitors (listed alphabetically) include Adaro Energy; Anglo American plc; BHP; Bumi Resources; China Shenhua Energy; Coal India Limited; Drummond Company; Glencore; South32; SUEK; Whitehaven Coal Limited; and Yancoal Australia Ltd, among others. Metallurgical Coal.
Major international direct coal supply competitors (listed alphabetically) include Adaro Energy; BHP; Bumi Resources; China Shenhua Energy; Coal India Limited; Drummond Company; Glencore; SUEK; Whitehaven Coal Limited; and Yancoal Australia Ltd, among others. Metallurgical Coal.
Human Capital Peabody had approximately 5,500 employees as of December 31, 2022, including approximately 4,300 hourly employees. Additional information on its employees and related labor relations matters is contained in Note 19. “Management — Labor Relations” to the accompanying consolidated financial statements, which information is incorporated herein by reference.
Human Capital Peabody had approximately 5,400 employees as of December 31, 2023, including approximately 4,200 hourly employees. Additional information on its employees and related labor relations matters is contained in Note 19. “Management — Labor Relations” to the accompanying consolidated financial statements, which information is incorporated herein by reference.
Peabody’s sales backlog, which includes coal supply agreements subject to price reopener and/or extension provisions, was approximately 314 million and 283 million tons of coal as of January 1, 2023 and 2022, respectively.
Peabody’s sales backlog, which includes coal supply agreements subject to price reopener and/or extension provisions, was approximately 221 million and 314 million tons of coal as of January 1, 2024 and 2023, respectively.
As part of its ongoing efforts to reform the self-insurance program to ensure that operators are adequately securing their liabilities, the OWCP proposed a rule in January 2023 to update its regulations for authorizing operators to self-insure and for determining appropriate security amounts. The public comment period for the proposed rule ends March 20, 2023.
As part of its ongoing efforts to reform the self-insurance program to ensure that operators are adequately securing their liabilities, the OWCP proposed a rule in January 2023 to update its regulations for authorizing operators to self-insure and for determining appropriate security amounts. The public comment period for the proposed rule ended April 19, 2023.
The cost calculation for each bond must be completed according to the regulatory authority of each state. The Company’s asset retirement obligations calculated in accordance with U.S. generally accepted accounting principles for its active and inactive Australian operations were $216.7 million as of December 31, 2022.
The cost calculation for each bond must be completed according to the regulatory authority of each state. The Company’s asset retirement obligations calculated in accordance with U.S. generally accepted accounting principles for its active and inactive Australian operations were $219.0 million as of December 31, 2023.
Peabody Energy Corporation 2022 Form 10-K 19 Table of Contents In Queensland, laws and regulations related to mining include, but are not limited to, the Mineral Resources Act 1989, Environmental Protection Act 1994 (EP Act), Environmental Protection Regulation 2008, Planning Act 2016, Coal Mining Safety and Health Act 1999, Minerals and Energy Resources (Common Provisions) Act 2014, Explosives Act 1999, Aboriginal Cultural Heritage Act 2003, Water Act 2000, State Development and Public Works Organisation Act 1971, Queensland Heritage Act 1992, Transport Infrastructure Act 1994, Nature Conservation Act 1992, Vegetation Management Act 1999, Biosecurity Act 2014, Land Act 1994, Regional Planning Interests Act 2014, Fisheries Act 1994 and Forestry Act 1959.
In Queensland, laws and regulations related to mining include, but are not limited to, the Mineral Resources Act 1989, Environmental Protection Act 1994 (EP Act), Environmental Protection Regulation 2008, Planning Act 2016, Coal Mining Safety and Health Act 1999, Minerals and Energy Resources (Common Provisions) Act 2014, Explosives Act 1999, Aboriginal Cultural Heritage Act 2003, Water Act 2000, State Development and Public Works Organisation Act 1971, Queensland Heritage Act 1992, Transport Infrastructure Act 1994, Nature Conservation Act 1992, Vegetation Management Act 1999, Biosecurity Act 2014, Land Act 1994, Regional Planning Interests Act 2014, Fisheries Act 1994 and Forestry Act 1959.
Sales under long-term coal supply agreements comprised approximately 85%, 84% and 89% of the Company’s worldwide sales from its mining operations (by volume) for the years ended December 31, 2022, 2021 and 2020, respectively. For the year ended December 31, 2022, Peabody derived 28% of its revenue from coal supply agreements from its five largest customers.
Sales under long-term coal supply agreements comprised approximately 92%, 85% and 84% of the Company’s worldwide sales from its mining operations (by volume) for the years ended December 31, 2023, 2022 and 2021, respectively. For the year ended December 31, 2023, Peabody derived 25% of its revenue from coal supply agreements from its five largest customers.
Modified and reconstructed fossil fuel-fired steam generating units must implement the most efficient generation achievable through a combination of best operating practices and equipment upgrades, to meet an emission standard consistent with best historical performance.
Modified and reconstructed fossil fuel-fired steam generating units must implement the most efficient generation achievable through a combination of best operating practices and equipment upgrades, to meet an emission standard consistent with best historical performance. Reconstructed EGUs must implement the most efficient generating technology based on the size of the unit.
Global thermal coal markets have been turbulent during 2022, due in part to the Russian-Ukrainian conflict and the subsequent ban of Russian coal by European countries.
Global thermal coal markets were turbulent during 2022 and 2023, due in part to the Russian-Ukrainian conflict and the subsequent ban of Russian coal by European countries.
In 2022, the Company achieved a global safety incidence rate of 1.13 incidents per 200,000 hours worked, which was 59% better than the 2022 U.S. industry average incidence rate of 2.77 incidents per 200,000 hours worked per the Mine Safety and Health Administration (MSHA). Peabody strives to offer an inclusive work environment and engages, recognizes and develops employees.
In 2023, the Company achieved a global safety incidence rate of 1.18 incidents per 200,000 hours worked, which was 57% better than the 2023 U.S. industry average incidence rate of 2.72 incidents per 200,000 hours worked per the Mine Safety and Health Administration (MSHA). Peabody strives to offer an inclusive work environment and engages, recognizes and develops employees.
A self-bond is an indemnity agreement in a sum certain executed by the permittee or by the permittee and any corporate guarantor made payable to the regulatory authority. The Company’s total reclamation bonding requirements in the U.S. were $1,035.0 million as of December 31, 2022.
A self-bond is an indemnity agreement in a sum certain executed by the permittee or by the permittee and any corporate guarantor made payable to the regulatory authority. The Company’s total reclamation bonding requirements in the U.S. were $965.9 million as of December 31, 2023.
These pressures, coupled with increasing regulatory burdens, have contributed to a significant number of coal plant retirements. During 2022, approximately 12 gigawatts of U.S. coal power capacity was retired, and since 2010, U.S. coal power capacity has fallen by approximately thirty-six percent. Internationally, thermal coal also competes with alternative forms of electricity generation.
These pressures, coupled with increasing regulatory burdens, have contributed to a significant number of coal plant retirements. During 2023, approximately 14 gigawatts of U.S. coal power capacity was retired, and since 2010, U.S. coal power capacity has fallen by approximately forty-one percent. Internationally, thermal coal also competes with alternative forms of electricity generation.
The Company’s asset retirement obligations calculated in accordance with generally accepted accounting principles for its active and inactive U.S. operations were $533.3 million as of December 31, 2022.
The Company’s asset retirement obligations calculated in accordance with generally accepted accounting principles for its active and inactive U.S. operations were $483.8 million as of December 31, 2023.
Most of the hourly workers employed in the Company’s mines are also covered by the Black Coal Mining Industry Award and company specific enterprise agreements approved under the national system. National Greenhouse and Energy Reporting Act 2007 (NGER Act) .
Most of the hourly workers employed in the Company’s mines are also covered by the Black Coal Mining Industry Award and company specific enterprise agreements approved under the national system.
Peabody Energy Corporation 2022 Form 10-K 24 Table of Contents The transition to a net-zero emissions economy is driven by many factors, including, but not limited to, legislative and regulatory rulemaking processes, campaigns undertaken by non-governmental organizations to minimize or eliminate the use of coal as a source of electricity generation, and the ESG-related policies of financial institutions and other private companies.
The transition to a net-zero emissions economy is driven by many factors, including, but not limited to, legislative and regulatory rulemaking processes, campaigns undertaken by non-governmental organizations to minimize or eliminate the use of coal as a source of electricity generation, and the ESG-related policies of financial institutions and other private companies.
A change in requirements for security posted to self-insure black lung liabilities could result in the Company being required to post additional security for its obligations. At the request of OWCP, the Company recently refiled its application for self-insurance. Environmental Laws and Regulations Peabody is subject to various federal, state, local and tribal environmental laws and regulations.
A change in requirements for security posted to self-insure black lung liabilities could result in the Company being required to post additional security for its obligations. Environmental Laws and Regulations Peabody is subject to various federal, state, local and tribal environmental laws and regulations.
Frankcombe holds a Bachelor of Engineering (Mining) from University of Wollongong and a Master of Business Administration (Technology) from Deakin University. Patrick J. Forkin III was named Chief Development Officer in July 2022 after serving as Senior Vice President - Corporate Development and Strategy since November 2017.
Frankcombe holds a Bachelor of Engineering (Mining) from University of Wollongong and a Master of Business Administration (Technology) from Deakin University. Patrick J. Forkin III was named Chief Development Officer in July 2022 after serving as Senior Vice President - Corporate Development and Strategy since November 2017. He leads global strategy, mergers and acquisitions, portfolio management and renewable energy development.
Surface and underground mining equipment demand and lead times for parts and components have increased in recent periods. Peabody consistently uses its global leverage with major suppliers and comprehensive planning processes to ensure security of supply to meet the requirements of its active mines. Services.
Surface and underground mining equipment demand and lead times for parts and components stabilized throughout 2023. Peabody consistently uses its global leverage with major suppliers and comprehensive planning processes to ensure security of supply to meet the requirements of its active mines. Services.
Revenue from Peabody’s Seaborne Thermal Mining and Seaborne Metallurgical Mining segments represented approximately 59%, 50% and 42% of the Company’s total revenue from coal supply agreements for the years ended December 31, 2022, 2021 and 2020, respectively, during which periods the coal mining activities of those segments contributed respective amounts of 18%, 18% and 19% of the Company’s sales volumes from mining operations.
Revenue from Peabody’s Seaborne Thermal and Seaborne Metallurgical segments represented approximately 56%, 59% and 50% of the Company’s total revenue from coal supply agreements for the years ended December 31, 2023, 2022 and 2021, respectively, during which all three periods the coal mining activities of those segments contributed approximately 18% of the Company’s sales volumes from mining operations.
Among its many provisions are programs that provide grants and other forms of direct and indirect financial assistance for the deployment of zero emission technologies as well as other actions that could affect energy markets and the future use of coal. The Company is currently assessing the potential environmental impacts of the legislation.
Among its many provisions are programs that provide grants and other forms of direct and indirect financial assistance for the deployment of zero emission technologies as well as other actions that could affect energy markets and the future use of coal.
An example of a NUMA is the void that remains after open-cut mining activities have been completed. Under the legislation, each current mine is exempt from the requirement to justify its NUMAs to the extent that its current approvals provide for such areas.
An example of a NUMA is the void that remains after open-cut mining activities have been completed. Under the legislation, an existing mine was exempt from the requirement to justify its NUMAs to the extent that its existing approvals provided for such areas. Residual Risks .
There is also federal and state legislation to prevent damage to Aboriginal cultural heritage and archaeological sites. Following the May 2020 destruction of caves at the Juukan Gorge in the Pilbara region of Western Australia by an iron ore mining operation, the Federal Government established a Senate Inquiry.
There is also federal and state legislation to prevent damage to Aboriginal cultural heritage and archaeological sites. Peabody Energy Corporation 2023 Form 10-K 20 Table of Contents Following the May 2020 destruction of caves at the Juukan Gorge in the Pilbara region of Western Australia by an iron ore mining operation, the federal government established a Senate Inquiry.
Thermal Mining segments, in aggregate, represented approximately 41%, 50% and 58% of the Company’s revenue from coal supply agreements for the years ended December 31, 2022, 2021 and 2020, respectively, during which periods the coal mining activities of those segments contributed respective aggregate amounts of approximately 82%, 82% and 81% of the Company’s sales volumes from mining operations.
Thermal segments, in aggregate, represented approximately 44%, 41% and 50% of the Company’s revenue from coal supply agreements for the years ended December 31, 2023, 2022 and 2021, respectively, during which all three periods the coal mining activities of those segments contributed approximately 82% of the Company’s sales volumes from mining operations.
In addition, seaborne thermal coal import demand can be significantly impacted by the availability of domestic coal production, particularly in the two leading coal import countries, China and India, among others. China’s unofficial ban on Australian coal in recent years continued until January 2023 and impeded traditional trade flows.
In addition, seaborne thermal coal import demand can be significantly impacted by the availability of domestic coal production, particularly in the two leading coal import countries, China and India, among others. China’s unofficial ban on Australian coal concluded in January 2023, enabling the reestablishment of some traditional trade flows.
The new progressive rehabilitation requirements commenced on November 1, 2019 and require each mine, within a three-year transitional period, to establish a schedule of rehabilitation milestones covering the life of the mine, and any significant changes to the timing of rehabilitation will require regulatory approval.
The new progressive rehabilitation requirements, which commenced on November 1, 2019, require each mine to establish a schedule of rehabilitation milestones covering the life of the mine, and any significant changes to the timing of rehabilitation require regulatory approval.
The EPA published the final MATS rule in the Federal Register in 2012. The MATS rule revised the NSPS for NO x , SO 2 and PM for new and modified coal-fueled electricity generating plants, and imposed maximum achievable control technology (MACT) emission limits on hazardous air pollutants (HAPs) from new and existing coal-fueled and oil-fueled electric generating plants.
Mercury and Air Toxic Standards (MATS) . In 2012, the EPA published the final MATS rule, which revised the NSPS for NO x , sulfur dioxide and PM for new and modified coal-fueled electricity generating plants, and imposed maximum achievable control technology (MACT) emission limits on hazardous air pollutants (HAPs) from new and existing coal-fueled and oil-fueled electric generating plants.
Peabody Energy Corporation 2022 Form 10-K 10 Table of Contents Jamie Frankcombe was named Peabody’s President - Australian Operations in November 2021. He has executive responsibility for the Company’s Australian operating platform, which includes leadership of health, safety and environment, people, operational performance and product delivery.
Jamie Frankcombe was named Peabody’s President - Australian Operations in November 2021. He has executive responsibility for the Company’s Australian operating platform, which includes leadership of health, safety and environment, people, operational performance and product delivery.
This financial assurance is in the form of cash, surety bonds or bank guarantees which are supported by a combination of cash collateral, deeds of indemnity and guarantee and letters of credit issued under the Company’s credit facility, collateralized letter of credit program and accounts receivable securitization program.
This financial assurance is in the form of cash, surety bonds or bank guarantees which are supported by a combination of cash collateral, deeds of indemnity and guarantee and letters of credit issued under the Company’s collateralized letter of credit program and accounts receivable securitization program. The Company operates in both the Queensland and New South Wales state jurisdictions.
This rule requires that newly-constructed fossil fuel-fired steam generating units achieve an emission standard for carbon dioxide of 1,400 lb carbon dioxide per megawatt-hour gross output (CO 2 /MWh-gross). The standard (known as the Best System of Emission Reduction (BSER)) is based on the performance of a supercritical pulverized coal boiler implementing partial carbon capture, utilization and storage (CCUS).
The rule requires that newly-constructed fossil fuel-fired steam generating units achieve an emission standard for CO 2 (known as the Best System of Emission Reduction (BSER)) which is based on the performance of a supercritical pulverized coal boiler implementing partial carbon capture, utilization and storage (CCUS).
The new law seeks to enhance the role of advisory committees to identify, quantify and prioritize safety and health issues in the mining and quarrying industries. It also provides for an independent Work Health and Safety Prosecutor to prosecute serious offenses under resources safety legislation.
RSHQ includes inspectorates for coal mines, mineral mines and quarries, explosives and petroleum and gas. The new law seeks to enhance the role of advisory committees to identify, quantify and prioritize safety and health issues in the mining and quarrying industries. It also provides for an independent Work Health and Safety Prosecutor to prosecute serious offenses under resources safety legislation.
As a result of legislation enacted in December 2020, the excise tax rates were set at 4.4% of the gross sales price not to exceed $1.10 per ton of underground coal and $0.55 per ton of surface coal for the year ending December 31, 2021.
The trust fund has been funded by an excise tax on U.S. production. As a result of legislation enacted in December 2020, the excise tax rates were set at 4.4% of the gross sales price not to exceed $1.10 per ton of underground coal and $0.55 per ton of surface coal for the year ending December 31, 2021.
These approvals are obtained under separate legislation from separate government authorities. However, the application processes run concurrently and are also concurrent with any native title or cultural heritage process that is required. The environmental impacts of mining projects are regulated by state and federal governments.
However, the application processes run concurrently and are also concurrent with any native title or cultural heritage process that is required. The environmental impacts of mining projects are regulated by state and federal governments.
The enactment of future laws or the passage of regulations regarding emissions from the use of coal by the U.S., some of its states or other countries, or other actions to limit such emissions, could result in electricity generators switching from coal to other fuel sources.
Peabody Energy Corporation 2023 Form 10-K 24 Table of Contents The enactment of future laws or the passage of regulations regarding emissions from the use of coal by the U.S., some of its states or other countries, or other actions to limit such emissions, could result in electricity generators switching from coal to other fuel sources.
The Affordable Care Act included significant changes to the federal black lung program including an automatic survivor benefit paid upon the death of a miner with an awarded black lung claim and establishes a rebuttable presumption with regard to pneumoconiosis among miners with 15 or more years of coal mine employment that are totally disabled by a respiratory condition.
The federal black lung program also includes automatic survivor benefits paid upon the death of a miner with an awarded black lung claim and a rebuttable presumption with regard to pneumoconiosis among miners with 15 or more years of coal mine employment that are totally disabled by a respiratory condition.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe mining industry has limited industry-specific accounting literature and, as a result, the Company understands diversity in practice exists in the interpretation and application of accounting literature to mining-specific issues. As diversity in mining industry accounting is addressed, the Company may need to restate its reported results if the resulting interpretations differ from its current accounting practices.
Biggest changePeabody Energy Corporation 2023 Form 10-K 40 Table of Contents Diversity in interpretation and application of accounting literature in the mining industry may impact the Company’s reported financial results. The mining industry has limited industry-specific accounting literature and, as a result, the Company understands diversity in practice exists in the interpretation and application of accounting literature to mining-specific issues.
In certain locations, leases for oil, natural gas and coalbed methane reserves are located on, or adjacent to, some of the Company’s reserves and resources, potentially creating conflicting interests between it and lessees of those interests. Other lessees’ rights relating to these mineral interests could prevent, delay or increase the cost of developing the Company’s coal reserves and resources.
In certain locations, leases for oil, natural gas and coalbed methane reserves are located on, or adjacent to, some of the Company’s coal reserves and resources, potentially creating conflicting interests between it and lessees of those interests. Other lessees’ rights relating to these mineral interests could prevent, delay or increase the cost of developing the Company’s coal reserves and resources.
As such, actual coal tonnage recovered from identified reserve and resource areas or properties and revenue and expenditures with respect to the Company’s reserves and resources may vary materially from estimates. Thus, these estimates may not accurately reflect its actual reserves and resources.
As such, actual coal tonnage recovered from identified reserve and resource areas or properties and revenue and expenditures with respect to the Company’s coal reserves and resources may vary materially from estimates. Thus, these estimates may not accurately reflect its actual reserves and resources.
These restrictions and covenants limit, among other things, the Company’s ability to: • incur additional indebtedness; • pay dividends on or make distributions in respect of stock or make certain other restricted payments, such as share repurchases; • make capital or other investments; • enter into agreements that restrict distributions from certain subsidiaries; • sell or otherwise dispose of assets; • use for general purposes the cash received from certain allowable asset sales or disposals; • enter into transactions with affiliates; • create or incur liens; • merge, consolidate or sell all or substantially all of its assets; and • receive dividends or other payments from subsidiaries in certain cases.
These restrictions and covenants may limit, among other things, the Company’s ability to: • incur additional indebtedness; • pay dividends on or make distributions in respect of stock or make certain other restricted payments, such as share repurchases; • make capital or other investments; • enter into agreements that restrict distributions from certain subsidiaries; • sell or otherwise dispose of assets; • use for general purposes the cash received from certain allowable asset sales or disposals; • enter into transactions with affiliates; • create or incur liens; • merge, consolidate or sell all or substantially all of its assets; and • receive dividends or other payments from subsidiaries in certain cases.
Furthermore, political or international conflicts could give rise to disruptions to Peabody or its business partners’ global technology infrastructure, including through cyber attack or cyber intrusion; adverse changes in international trade policies and relations; regulatory enforcement; Peabody’s ability to implement and execute its business strategy; terrorist activities; Peabody’s exposure to foreign currency fluctuations; and constraints, volatility, or disruption in the capital markets, any of which could have a material adverse effect on the Company’s business, results of operations, cash flows and financial condition.
Furthermore, political or international conflicts could give rise to disruptions to Peabody or its business partners’ global technology infrastructure, including through cybersecurity attack or cyber intrusion; adverse changes in international trade policies and relations; regulatory enforcement; Peabody’s ability to implement and execute its business strategy; terrorist activities; Peabody’s exposure to foreign currency fluctuations; and constraints, volatility, or disruption in the capital markets, any of which could have a material adverse effect on the Company’s business, results of operations, cash flows and financial condition.
The Company may not be able to negotiate or secure new leases from the government or from private parties, obtain mining contracts for properties containing additional reserves and resources or maintain its leasehold interest in properties on which mining operations have not commenced or have not met minimum quantity or product royalty requirements.
The Company may not be able to negotiate or secure new leases from the government or from private parties, obtain mining contracts for properties containing additional coal reserves and resources or maintain its leasehold interest in properties on which mining operations have not commenced or have not met minimum quantity or product royalty requirements.
Most of its mining operations are conducted on properties owned or leased by the Company. Its right to mine some of its reserves and resources may be materially adversely affected if defects in title or boundaries exist. In order to conduct its mining operations on properties where these defects exist, the Company may incur unanticipated costs.
Most of its mining operations are conducted on properties owned or leased by the Company. Its right to mine some of its coal reserves and resources may be materially adversely affected if defects in title or boundaries exist. In order to conduct its mining operations on properties where these defects exist, the Company may incur unanticipated costs.
To the extent that the Company’s existing sources of liquidity are not sufficient to fund its planned mine development projects or reserve and resource acquisition activities, it may require access to capital markets, which may not be available to it or, if available, may not be available on satisfactory terms.
To the extent that the Company’s existing sources of liquidity are not sufficient to fund its planned mine development projects or coal reserve and resource acquisition activities, it may require access to capital markets, which may not be available to it or, if available, may not be available on satisfactory terms.
Any material inaccuracy in the Company’s estimates related to its reserves and resources could result in lower than expected revenue, higher than expected costs or decreased profitability which could materially and adversely affect its business, results of operations, financial position and cash flows.
Any material inaccuracy in the Company’s estimates related to its coal reserves and resources could result in lower than expected revenue, higher than expected costs or decreased profitability which could materially and adversely affect its business, results of operations, financial position and cash flows.
Peabody Energy Corporation 2022 Form 10-K 27 Table of Contents Coal prices are dependent upon factors beyond the Company’s control, including: • the demand for electricity and capacity utilization of electricity generating units (whether coal or non-coal); • changes in the fuel consumption and dispatch patterns of electric power generators, whether based on economic or non-economic factors; • the proximity, capacity and cost of transportation and terminal facilities; • competition with and the availability, quality and price of coal and alternative fuels, including natural gas, fuel oil, nuclear, hydroelectric, wind, biomass and solar power; • governmental regulations and taxes, including tariffs or other trade restrictions as well as those establishing air emission standards for coal-fueled power plants or mandating or subsidizing increased use of electricity from renewable energy sources; • the strength of the global economy; • the global supply and production costs of thermal and metallurgical coal; • the demand for steel, which may lead to price fluctuations in the monthly and quarterly repricing of the Company’s metallurgical coal contracts; • weather patterns, severe weather and natural disasters; • regulatory, administrative and judicial decisions, including those affecting future mining permits and leases; • competing technologies used to make steel, some of which do not use coal as a manufacturing input, such as electric arc furnaces; and • technological developments, including those related to alternative energy sources, those intended to convert coal-to-liquids or gas and those aimed at capturing, using and storing carbon dioxide.
Peabody Energy Corporation 2023 Form 10-K 26 Table of Contents Coal prices are dependent upon factors beyond the Company’s control, including: • the demand for electricity and capacity utilization of electricity generating units (whether coal or non-coal); • changes in the fuel consumption and dispatch patterns of electric power generators, whether based on economic or non-economic factors; • the proximity, capacity and cost of transportation and terminal facilities; • competition with and the availability, quality and price of coal and alternative fuels, including natural gas, fuel oil, nuclear, hydroelectric, wind, biomass and solar power; • governmental regulations and taxes, including tariffs or other trade restrictions as well as those establishing air emission standards for coal-fueled power plants or mandating or subsidizing increased use of electricity from renewable energy sources; • the strength of the global economy; • the global supply and production costs of thermal and metallurgical coal; • the demand for steel, which may lead to price fluctuations in the monthly and quarterly repricing of the Company’s metallurgical coal contracts; • weather patterns, severe weather and natural disasters; • regulatory, administrative and judicial decisions, including those affecting future mining permits and leases; • competing technologies used to make steel, some of which do not use coal as a manufacturing input, such as electric arc furnaces; and • technological developments, including those related to alternative energy sources, those intended to convert coal-to-liquids or gas and those aimed at capturing, using and storing carbon dioxide.
The Company has substantial take-or-pay arrangements with its port access and rail transportation providers, predominately in Australia, totaling $1.4 billion, with terms ranging up to 20 years, that commit the Company to pay a minimum amount for the delivery of coal even if those commitments go unused.
The Company has substantial take-or-pay arrangements with its port access and rail transportation providers, predominately in Australia, totaling $1.2 billion, with terms ranging up to 20 years, that commit the Company to pay a minimum amount for the delivery of coal even if those commitments go unused.
Peabody could be exposed to significant liability, reputational harm, loss of revenue, increased costs or other risks if it sustains cyber attacks or other security breaches that disrupt its operations or result in the dissemination of proprietary or confidential information about the Company, its customers or other third-parties.
Peabody could be exposed to significant liability, reputational harm, loss of revenue, increased costs or other risks if it sustains cybersecurity attacks or other security breaches that disrupt its operations or result in the dissemination of proprietary or confidential information about the Company, its customers or other third-parties.
New legislation or administrative regulations (or new interpretations by the relevant government of existing laws, regulations and approvals), including proposals related to the protection of the environment or the reduction of greenhouse gas emissions that would further regulate and tax the coal industry, may also require the Company or its customers to change operations significantly or incur increased costs.
New legislation or administrative regulations (or new interpretations by the relevant government of existing laws, regulations and approvals), including proposals related to the protection of the environment or the reduction of GHG emissions that would further regulate and tax the coal industry, may also require the Company or its customers to change operations significantly or incur increased costs.
Peabody Energy Corporation 2022 Form 10-K 28 Table of Contents If a substantial number of the Company’s long-term coal supply agreements, including those with its largest customers, terminate, or if the pricing, volumes or other elements of those agreements materially adjust, its revenue and operating profits could suffer if the Company is unable to find alternate buyers willing to purchase its coal on comparable terms to those in its contracts.
Peabody Energy Corporation 2023 Form 10-K 27 Table of Contents If a substantial number of the Company’s long-term coal supply agreements, including those with its largest customers, terminate, or if the pricing, volumes or other elements of those agreements materially adjust, its revenue and operating profits could suffer if the Company is unable to find alternate buyers willing to purchase its coal on comparable terms to those in its contracts.
A decrease in the discount rate used to determine its postretirement benefit and defined benefit pension obligations could result in an increase in the valuation of these obligations, thereby increasing the cost in subsequent fiscal years. The Company has made assumptions related to future trends for medical care costs in the estimates of retiree health care obligations.
A decrease in the discount rate used to determine its postretirement benefit obligations could result in an increase in the valuation of these obligations, thereby increasing the cost in subsequent fiscal years. The Company has made assumptions related to future trends for medical care costs in the estimates of retiree health care obligations.
Thermal coal accounted for the majority of the Company’s coal sales by volume during 2022 and 2021, with the vast majority of these sales to electric power generators.
Thermal coal accounted for the majority of the Company’s coal sales by volume during 2023 and 2022, with the vast majority of these sales to electric power generators.
If the Company fails to accurately estimate the future results and value of an acquired or divested business or assets and the related risk associated with such a transaction, or are unable to successfully integrate the businesses or assets it acquires, its business, financial condition or results of operations could be negatively affected.
If the Company fails to accurately estimate the future results and value of these assets or any other acquired or divested business or assets and the related risk associated with such a transaction, or are unable to successfully integrate the businesses or assets it acquires, its business, financial condition or results of operations could be negatively affected.
Peabody Energy Corporation 2022 Form 10-K 29 Table of Contents Risks inherent to mining could increase the cost of operating the Company’s business, and events and conditions that could occur during the course of its mining operations could have a material adverse impact on the Company.
Peabody Energy Corporation 2023 Form 10-K 28 Table of Contents Risks inherent to mining could increase the cost of operating the Company’s business, and events and conditions that could occur during the course of its mining operations could have a material adverse impact on the Company.
The payment of future cash dividends and future repurchases will depend upon these restrictions, as well as Peabody’s earnings, economic conditions, liquidity and capital requirements, and other factors, including its leverage and other financial ratios. Accordingly, the Company cannot make any assurance that future dividends will be paid or future repurchases will be made.
The payment of future cash dividends and future repurchases will depend upon Peabody’s earnings, economic conditions, liquidity and capital requirements, and other factors, including its leverage and other financial ratios. Accordingly, the Company cannot make any assurance that future dividends will be paid or future repurchases will be made.
The Company produces metallurgical coal that is used in the global steel industry. Metallurgical coal accounted for approximately 32% and 22% of its revenue in 2022 and 2021, respectively. Changes in governmental policies and regulations and changes in the steel industry, including the demand for steel, could reduce the demand for the Company’s metallurgical coal.
The Company produces metallurgical coal that is used in the global steel industry. Metallurgical coal accounted for approximately 26% and 32% of its revenue in 2023 and 2022, respectively. Changes in governmental policies and regulations and changes in the steel industry, including the demand for steel, could reduce the demand for the Company’s metallurgical coal.
The Company’s operations are susceptible to widespread outbreaks of illness or other public health issues, such as the global coronavirus (COVID-19) pandemic. Pandemic illnesses could have a material adverse effect on the Company’s business, results of operations, financial condition and prospects, including its ability to comply with restrictions and covenants under its debt and surety bonding obligations.
The Company’s operations are susceptible to widespread outbreaks of illness or other public health issues. Pandemic illnesses could have a material adverse effect on the Company’s business, results of operations, financial condition and prospects, including its ability to comply with restrictions and covenants under its debt and surety bonding obligations.
The Company has entered into certain hedging arrangements to address these risks, and may continue in the future to enter into hedging arrangements, including economic hedging arrangements, to manage these risks or other exposures. Since the Company’s existing hedging arrangements do not receive cash flow hedge accounting treatment, all changes in fair value are reflected in current earnings.
The Company hedges certain of these risks through hedging arrangements and may continue in the future to enter into hedging arrangements, including economic hedging arrangements, to manage these risks or other exposures. Since the Company’s existing hedging arrangements do not receive cash flow hedge accounting treatment, all changes in fair value are reflected in current earnings.
As further described in “Liquidity and Capital Resources” of Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in November 2020, the Company entered into a surety transaction support agreement with the providers of its surety bond portfolio.
As further described in “Liquidity and Capital Resources” of Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the Company has a surety transaction support agreement with the providers of its surety bond portfolio.
Peabody Energy Corporation 2022 Form 10-K 38 Table of Contents The number and quantity of viable financing and insurance alternatives available to the Company may be significantly impacted by unfavorable lending and investment policies by financial institutions and insurance companies associated with concerns about environmental impacts of coal combustion, and negative views around its efforts with respect to environmental and social matters and related governance considerations could harm the perception of the Company by a significant number of investors or result in the exclusion of its securities from consideration by those investors.
The number and quantity of viable financing and insurance alternatives available to the Company may be significantly impacted by unfavorable lending and investment policies by financial institutions and insurance companies associated with concerns about environmental impacts of coal combustion, and negative views around its efforts with respect to environmental and social matters and related governance considerations could harm the perception of the Company by a significant number of investors or result in the exclusion of its securities from consideration by those investors.
For the year ended December 31, 2022, the Company derived 28% of its revenue from coal supply agreements from its five largest customers. Those five customers were supplied primarily from 16 coal supply agreements (excluding trading and brokerage transactions) expiring at various times from 2023 to 2025.
For the year ended December 31, 2023, the Company derived 25% of its revenue from coal supply agreements from its five largest customers. Those five customers were supplied primarily from 13 coal supply agreements (excluding trading and brokerage transactions) expiring at various times from 2024 to 2025.
Peabody Energy Corporation 2022 Form 10-K 30 Table of Contents The Company could be negatively affected if it fails to maintain satisfactory labor relations. As of December 31, 2022, the Company had approximately 5,500 employees (excluding employees that were employed at operations classified as discontinued), which included approximately 4,300 hourly employees.
Peabody Energy Corporation 2023 Form 10-K 29 Table of Contents The Company could be negatively affected if it fails to maintain satisfactory labor relations. As of December 31, 2023, the Company had approximately 5,400 employees (excluding employees that were employed at operations classified as discontinued), which included approximately 4,200 hourly employees.
Approximately 34% of its hourly employees were represented by organized labor unions and generated approximately 16% of its coal production for the year ended December 31, 2022. Relations with its employees and, where applicable, organized labor are important to the Company’s success.
Approximately 38% of its hourly employees were represented by organized labor unions and generated approximately 18% of its coal production for the year ended December 31, 2023. Relations with its employees and, where applicable, organized labor are important to the Company’s success.
Further, Peabody could be the subject of securities class action litigation due to any such stock price volatility, which could divert management’s attention and have a material adverse effect on its results of operation.
Further, Peabody could be the subject of securities class action litigation due to any such stock price volatility, which could divert management’s attention and have a material adverse effect on its results of operation. Peabody’s Common Stock is subject to dilution and may be subject to further dilution in the future.
Peabody Energy Corporation 2022 Form 10-K 33 Table of Contents Numerous activist groups are devoting substantial resources to anti-coal activities to minimize or eliminate the use of coal as a source of electricity generation, domestically and internationally, thereby further reducing the demand and pricing for coal, and potentially materially and adversely impacting the Company’s future financial results, liquidity and growth prospects.
Numerous activist groups are devoting substantial resources to anti-coal activities to minimize or eliminate the use of coal as a source of electricity generation, domestically and internationally, thereby further reducing the demand and pricing for coal, and potentially materially and adversely impacting the Company’s future financial results, liquidity and growth prospects.
If the Company experiences a default under the terms of its debt or surety bonding obligations for any reason, its business, financial condition and results of operations could be materially and adversely affected.
In this regard, if the Company experiences a default under the terms of its unsecured debt, revolving credit facility or surety bonding obligations for any reason, its business, financial condition and results of operations could be materially and adversely affected.
In addition, complying with such terms may make it more difficult for the Company to successfully execute its business strategy and compete against companies who are not subject to such restrictions.
In addition, complying with such terms may make it more difficult for the Company to successfully execute its business strategy, including by making it more difficult to compete against competitors who are not subject to such financial restrictions.
For additional information about the various regulations affecting the Company, see the sections entitled “Regulatory Matters —U.S.” and “Regulatory Matters — Australia.” The Company’s operations may impact the environment or cause exposure to hazardous substances, and its properties may have environmental contamination, which could result in material liabilities to the Company.
For additional information about the various regulations affecting the Company, see the sections entitled “Regulatory Matters —U.S.” and “Regulatory Matters — Australia.” Peabody Energy Corporation 2023 Form 10-K 31 Table of Contents The Company’s operations may impact the environment or cause exposure to hazardous substances, and its properties may have environmental contamination, which could result in material liabilities to the Company.
The Company’s trading and hedging activities do not cover certain risks and may expose it to earnings volatility and other risks. In addition to coal price volatility, the Company is currently subject to price volatility on diesel fuel utilized in its mining operations and the Australian dollar.
The Company’s trading and hedging activities do not cover certain risks and may expose it to earnings volatility and other risks. The Company is subject to coal price volatility, price volatility on diesel fuel utilized in its mining operations and foreign currency exchange rate risk associated with the Australian dollar.
As of December 31, 2022, the Company leased a total of 44,287 acres from the federal government subject to those limitations. The Company’s planned mine development projects and acquisition activities may not result in significant additional reserves and resources, and it may not have success developing additional mines.
As of December 31, 2023, the Company leased a total of 44,287 acres from the federal government subject to those limitations. Peabody Energy Corporation 2023 Form 10-K 33 Table of Contents The Company’s planned mine development projects and acquisition activities may not result in significant additional reserves and resources, and it may not have success developing additional mines.
As of December 31, 2022, the Company had gross deferred income tax assets, including net operating loss (NOL) carryforwards, and liabilities of $1,587.0 million and $81.7 million, respectively, as described further in Note 8. “Income Taxes” to the accompanying consolidated financial statements. At that date, the Company also had recorded a valuation allowance of $1,451.0 million.
As of December 31, 2023, the Company had gross deferred income tax assets, including net operating loss (NOL) carryforwards, and liabilities of $1,556.1 million and $111.2 million, respectively, as described further in Note 8. “Income Taxes” to the accompanying consolidated financial statements. At that date, the Company also had recorded a valuation allowance of $1,473.5 million.
The Company pays postretirement health and life insurance benefits to eligible retirees. Its total accumulated postretirement benefit obligation related to such benefits was a liability of $172.5 million as of December 31, 2022, of which $16.0 million was classified as a current liability. These liabilities are actuarially determined.
The Company pays postretirement health and life insurance benefits to eligible retirees. Its total accumulated postretirement benefit obligation related to such benefits was a liability of $163.7 million as of December 31, 2023, of which $15.3 million was classified as a current liability. These liabilities are actuarially determined.
Risks Related to Peabody’s Capital Structure The terms of the agreements and instruments governing the Company’s debt and surety bonding obligations impose restrictions that may limit its operating and financial flexibility.
The terms of the agreements and instruments governing the Company’s debt and surety bonding obligations impose restrictions that may limit its operating and financial flexibility.
Joint ventures, partnerships or non-managed operations may not be successful and may not comply with the Company’s operating standards. The Company participates in several joint venture and partnership arrangements and may enter into others, all of which necessarily involve risk.
Peabody Energy Corporation 2023 Form 10-K 34 Table of Contents Joint ventures, partnerships or non-managed operations may not be successful and may not comply with the Company’s operating standards. The Company participates in several joint venture and partnership arrangements and may enter into others, all of which necessarily involve risk.
“Properties” involves the use of certain estimates and those estimates could be inaccurate. Actual production, revenue and expenditures with respect to its coal reserves and resources may vary materially from estimates.
Moreover, the amount of coal reserves and resources described in Part I, Item 2. “Properties” involves the use of certain estimates and those estimates could be inaccurate. Actual production, revenue and expenditures with respect to its coal reserves and resources may vary materially from estimates.
Numerous governmental permits and approvals are required for mining operations. The permitting rules, and the interpretations of these rules, are complex, change frequently and are often subject to discretionary interpretations by regulators, all of which may make compliance more difficult or impractical.
The permitting rules, and the interpretations of these rules, are complex, change frequently and are often subject to discretionary interpretations by regulators, all of which may make compliance more difficult or impractical.
Peabody is exposed to risks associated with political or international conflicts such as the ongoing conflict between Russia and Ukraine. Political or international conflicts can result in worldwide geopolitical and macroeconomic uncertainty, as has been the case with the ongoing conflict between Russia and Ukraine. The Company is unable to predict the ultimate impacts related to such conflicts.
Political or international conflicts can result in worldwide geopolitical and macroeconomic uncertainty, as has been the case with the ongoing conflict between Russia and Ukraine, the Israel-Hamas conflict and escalating tensions in the Middle East. The Company is unable to predict the ultimate impacts related to such conflicts.
In turn, increasing government attention is being paid to global climate issues and to emissions of greenhouse gases, including emissions of carbon dioxide from coal combustion by power plants.
In turn, increasing government attention is being paid to global climate issues and to emissions of GHGs, including emissions of CO 2 from coal combustion by power plants.
If the Company’s mortality tables do not anticipate its population’s mortality experience as accurately as expected, actual cash expenditures and costs that the Company incurs could differ materially from its current estimates.
If the Company’s mortality tables do not anticipate its population’s mortality experience as accurately as expected, actual cash expenditures and costs that the Company incurs could differ materially from its current estimates. High inflation could continue to result in higher costs and decreased profitability.
The price of Peabody’s common stock (Common Stock) may fluctuate due to a variety of market and industry factors that may materially reduce the market price of its Common Stock regardless of its operating performance, including, among others: • actual or anticipated fluctuations in Peabody’s quarterly and annual results and those of other public companies in its industry; • industry cycles and trends; • mergers and strategic alliances in the coal industry; • changes in government regulation; • potential or actual military conflicts or acts of terrorism; • the failure of securities analysts to publish research about Peabody or to accurately predict the results it actually achieves; • changes in accounting principles; • announcements concerning Peabody or its competitors; • the purchase and sale of shares of its Common Stock by significant shareholders; • lack of or excess of trading liquidity; and • the general volatility of securities markets.
The price of Peabody’s common stock (Common Stock) may fluctuate due to a variety of market and industry factors that may materially reduce the market price of its Common Stock regardless of its operating performance, including, among others: • general economic conditions within the U.S. and internationally, including inflationary pressures and changes in interest rates; • general market conditions; • actual or anticipated fluctuations in Peabody’s quarterly and annual results and those of other public companies in its industry; • industry cycles and trends; • mergers and strategic alliances in the coal industry; • changes in government regulation; • potential or actual military conflicts or acts of terrorism; • the failure of securities analysts to publish research about Peabody or to accurately predict the results it actually achieves; • changes in accounting principles; • announcements concerning Peabody or its competitors; • the purchase and sale of shares of its Common Stock by significant shareholders; • lack of or excess of trading liquidity; • operational incidents; and • investor sentiment with respect to our policies or efforts on environmental, social or governance matters.
Peabody Energy Corporation 2022 Form 10-K 37 Table of Contents The Company is subject to various general operating risks which may be fully or partially outside of its control. The Company’s results of operations, financial position or cash flows could be adversely impacted by various general operating risks which may be fully or partially outside of its control.
The Company is subject to various general operating risks which may be fully or partially outside of its control. The Company’s results of operations, financial position or cash flows could be adversely impacted by various general operating risks which may be fully or partially outside of its control.
These provisions could limit the price that certain investors might be willing to pay in the future for shares of its Common Stock and may have the effect of delaying or preventing a change in control. Diversity in interpretation and application of accounting literature in the mining industry may impact the Company’s reported financial results.
These provisions could limit the price that certain investors might be willing to pay in the future for shares of its Common Stock and may have the effect of delaying or preventing a change in control.
In addition, Peabody may continue issuing equity securities in connection with future investments, acquisitions or capital raising transactions. Such issuances or grants could constitute a significant portion of the then-outstanding Common Stock, which may result in significant dilution in ownership of Common Stock.
Peabody’s Common Stock is subject to dilution from its convertible senior debt and its long-term incentive plan. In addition, Peabody may continue issuing equity securities in connection with future investments, acquisitions or capital raising transactions. Such issuances or grants could constitute a significant portion of the then-outstanding Common Stock, which may result in significant dilution in ownership of Common Stock.
Peabody Energy Corporation 2022 Form 10-K 31 Table of Contents The Company’s mining operations are extensively regulated, which imposes significant costs on it, and future regulations and developments could increase those costs or limit its ability to produce coal.
The Company’s mining operations are extensively regulated, which imposes significant costs on it, and future regulations and developments could increase those costs or limit its ability to produce coal.
As of December 31, 2022, the Company had $1,376.8 million of outstanding surety bonds and $569.6 million of letters of credit with third parties in order to provide required financial assurances for post-mining reclamation, workers’ compensation and other insurance obligations, coal lease-related and other obligations and performance guarantees, in addition to collateral for sureties.
As of December 31, 2023, the Company had $1,139.9 million of outstanding surety bonds; $276.7 million of deposits with regulatory authorities; $275.1 million of letters of credit with third parties; and $64.9 million of cash backed bank guarantees in order to provide required financial assurances for post-mining reclamation, workers’ compensation and other insurance obligations, coal lease-related and other obligations and performance guarantees, in addition to collateral for sureties.
If any such default occurs, subject to applicable grace periods, the holders of the Company’s indebtedness may elect to declare such indebtedness, together with accrued interest and other amounts payable thereunder, to be immediately due and payable.
If any such default occurs, subject to applicable grace periods, the holders of the Company’s indebtedness may elect to declare such indebtedness, together with accrued interest and other amounts payable thereunder, to be immediately due and payable. In addition, the lenders under the Company’s revolving credit facility could elect to require the cash collateralization of any outstanding letters of credit.
From time to time, the Company’s board of directors and management attempt to analyze the potential impact on the Company of as-yet-unadopted, potential laws, regulations and policies.
Peabody Energy Corporation 2023 Form 10-K 32 Table of Contents From time to time, the Company’s Board of Directors and management attempt to analyze the potential impact on the Company of as-yet-unadopted, potential laws, regulations and policies.
If the assumptions underlying the Company’s asset retirement obligations for reclamation and mine closures are materially inaccurate, its costs could be significantly greater than anticipated.
Peabody Energy Corporation 2023 Form 10-K 30 Table of Contents If the assumptions underlying the Company’s asset retirement obligations for reclamation and mine closures are materially inaccurate, its costs could be significantly greater than anticipated.
Peabody Energy Corporation 2022 Form 10-K 35 Table of Contents The conversion of reported mineral resources to mineral reserves should not be assumed, and the reclassification of reported mineral resources from lower to higher levels of geological confidence should not be assumed.
The conversion of reported mineral resources to mineral reserves should not be assumed, and the reclassification of reported mineral resources from lower to higher levels of geological confidence should not be assumed.
Such transactions may advance the interests of the significant stockholder and not necessarily those of other stakeholders, which might adversely affect Peabody or other holders of its Common Stock or debt instruments. The future payment of dividends on Peabody’s stock or future repurchases of its stock is dependent on a number of factors and cannot be assured.
Such transactions may advance the interests of the significant stockholder and not necessarily those of other stakeholders, which might adversely affect Peabody or other holders of its Common Stock or debt instruments.
The Company’s ability to comply with these restrictions or covenants may be affected by events beyond its control and the Company may need to refinance existing debt in the future. A breach of any of these restrictions or covenants together with the expiration of any cure period, if applicable, could result in a default.
Peabody Energy Corporation 2023 Form 10-K 37 Table of Contents The Company’s ability to comply with these restrictions or covenants may be affected by events beyond its control. A breach of any of these restrictions or covenants together with the expiration of any cure period, if applicable, could result in a default.
Peabody Energy Corporation 2022 Form 10-K 32 Table of Contents The Company may be unable to obtain, renew or maintain permits necessary for its operations, or the Company may be unable to obtain, renew or maintain such permits without conditions on the manner in which it runs its operations, which would reduce its production, cash flows and profitability.
The Company may be unable to obtain, renew or maintain permits necessary for its operations, or the Company may be unable to obtain, renew or maintain such permits without conditions on the manner in which it runs its operations, which would reduce its production, cash flows and profitability. Numerous governmental permits and approvals are required for mining operations.
The resulting estimated asset retirement obligation could change significantly if actual amounts change significantly from its assumptions, which could have a material adverse effect on its results of operations and financial condition. The Company’s future success depends upon its ability to continue acquiring and developing coal reserves and resources that are economically recoverable.
The resulting estimated asset retirement obligation could change significantly if actual amounts change significantly from its assumptions, which could have a material adverse effect on its results of operations and financial condition.
The Company may engage in acquisition or divestiture activity based on its set of investment criteria to produce outcomes that increase shareholder value or provide potential strategic benefits.
The Company has engaged in, and may continue to engage in acquisition or divestiture activity, such as its recent conditional acquisition of the southern part of Stanmore’s Ward Wells Tenements in Queensland’s Bowen Basin, based on its set of investment criteria to produce outcomes that increase shareholder value or provide potential strategic benefits.
The Company’s recoverable reserves and resources decline as it produces coal. The Company has not yet applied for the permits required or developed the mines necessary to use all of its reserves and resources. Moreover, the amount of coal reserves and resources described in Part I, Item 2.
The Company’s future success depends upon its ability to continue acquiring and developing coal reserves and resources that are economically recoverable. The Company’s recoverable reserves and resources decline as it produces coal. The Company has not yet applied for the permits required or developed the mines necessary to use all of its reserves and resources.
The Company’s current strategy includes increasing its reserves and resources through acquisitions of government and other leases and producing properties and continuing to use its existing properties and infrastructure.
The Company’s future success depends upon it conducting successful exploration and development activities or acquiring properties containing economically recoverable reserves and resources. The Company’s current strategy includes increasing its coal reserves and resources through acquisitions of government and other leases and producing properties and continuing to use its existing properties and infrastructure.
The agreements governing the Company’s debt and surety bonding obligations contain certain restrictions and covenants which restrict its ability to incur liens and/or debt or provide guarantees in respect of obligations of any other person and other restrictions, all of which could adversely affect the Company’s ability to operate its business, as well as significantly affect its liquidity, and therefore could adversely affect its results of operations.
The agreements governing the Company’s unsecured debt, revolving credit facility and surety bonding obligations contain certain restrictions and covenants, which are described below and which could adversely affect the Company’s ability to operate its business, as well as significantly affect its liquidity, and therefore could adversely affect its business, financial condition and results of operations.
Risks Related to Ownership of Peabody’s Securities The price of Peabody’s securities may be volatile.
Peabody Energy Corporation 2023 Form 10-K 38 Table of Contents Risks Related to Ownership of Peabody’s Securities The price of Peabody’s securities may be volatile.
Peabody Energy Corporation 2022 Form 10-K 40 Table of Contents Acquisitions and divestitures are a potentially important part of the Company’s long-term strategy, subject to its investment criteria, and involve a number of risks, any of which could cause the Company not to realize the anticipated benefits.
The Company’s results of operations, financial condition and cash flows may adversely be affected in future periods by these limitations. Acquisitions and divestitures are a potentially important part of the Company’s long-term strategy, subject to its investment criteria, and involve a number of risks, any of which could cause the Company not to realize the anticipated benefits.
Refer to Note 1. “Summary of Significant Accounting Policies” to the accompanying consolidated financial statements for a summary of the Company’s significant accounting policies. Item 1B. Unresolved Staff Comments. None.
As diversity in mining industry accounting is addressed, the Company may need to restate its reported results if the resulting interpretations differ from its current accounting practices. Refer to Note 1. “Summary of Significant Accounting Policies” to the accompanying consolidated financial statements for a summary of the Company’s significant accounting policies. Item 1B. Unresolved Staff Comments. None.
Peabody Energy Corporation 2022 Form 10-K 36 Table of Contents The Company’s business, results of operations, financial condition and prospects could be materially and adversely affected by pandemic or other widespread illnesses and the related effects on public health.
Accordingly, substantial inflation may result in a material adverse impact on the Company’s costs, profitability and financial results. The Company’s business, results of operations, financial condition and prospects could be materially and adversely affected by pandemic or other widespread illnesses and the related effects on public health.
Inflation could result in higher costs and decreased profitability Recent inflation, increasing the cost of materials, labor, equipment, freight, fuel and other cost categories, has adversely impacted the Company and could be a sustained trend.
In recent years the Company has been adversely impacted by inflation, which has increased the cost of materials, labor, equipment, freight, fuel and other cost categories.
The primary methods the Company uses to meet those obligations are to provide a third-party surety bond or a letter of credit.
Historically, the primary methods the Company has used to meet those obligations are to provide a third-party surety bond or a letter of credit. In recent years, the Company has also utilized deposits with regulatory authorities or cash backed bank guarantees.
Governmental mandates could require forced shutdowns of its mines and other facilities for extended or indefinite periods and widespread outbreaks in locations significant to its operations could adversely affect its workforce, resulting in serious health issues and absenteeism. In addition, pandemic illnesses could cause supply chain and distribution channels to be interrupted, slowed or rendered inoperable.
Peabody Energy Corporation 2023 Form 10-K 35 Table of Contents Pandemic or other widespread illnesses could result in governmental mandates requiring shutdowns of facilities for indefinite periods; serious health issues and absenteeism within the workforce; and disruptions to supply chain and distribution channels impacting both vendors and customers. As a result, the Company could face increased costs or decreased sales.
The Company could also face disruption to supply chain and distribution channels, potentially increasing costs of production, storage and distribution, and potential adverse effects to its workforce, each of which could have a material adverse effect on its business, financial condition, results of operations and prospects.
These factors could have a material adverse effect on its business, financial condition, results of operations and prospects. Peabody is exposed to risks associated with political or international conflicts.
Removed
Peabody Energy Corporation 2022 Form 10-K 34 Table of Contents The Company’s future success depends upon it conducting successful exploration and development activities or acquiring properties containing economically recoverable reserves and resources.
Added
Under the Company’s agreement with the providers of its surety portfolio, the Company has $444.0 million in cash held in trust accounts for the benefit of certain surety providers as of December 31, 2023.
Removed
Additionally, the Company’s reported defined benefit pension funding status may be affected, and it may be required to increase employer contributions, due to increases in its defined benefit pension obligation or poor financial performance in asset markets in future years.
Added
Peabody Energy Corporation 2023 Form 10-K 36 Table of Contents Risks Related to Peabody’s Capital Structure The Company may be able to incur more debt, including secured debt, which could increase the risks associated with its indebtedness. As of December 31, 2023, the Company had approximately $320.0 million of unsecured indebtedness outstanding, excluding finance leases and debt issuance costs.
Removed
Accordingly, substantial inflation may result in a material adverse impact on the Company’s costs, profitability and financial results. During the year ended December 31, 2022, the Company estimates that the impact of inflation increased operating costs and expenses by approximately $230 million over the prior year.
Added
As further discussed in “Liquidity and Capital Resources” of Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” as of January 2024 the Company has an additional $320.0 million in revolving commitments. The Company may be able to incur additional indebtedness in the future, including secured debt.
Removed
Governmental mandates and the Company’s efforts to act in the best interests of its employees, customers, suppliers, vendors and joint venture and other business partners, could affect its business and operations, causing the Company to modify a number of its normal business practices.
Added
Although covenants under agreements governing the Company’s other indebtedness, including its revolving credit facility and finance leases, limit the Company’s ability to incur additional indebtedness, these restrictions are subject to a number of qualifications and exceptions.
Removed
If the Company’s operations were curtailed, it may need to seek alternate sources of supply for commodities, services and labor, which may be more expensive. Alternate sources may not be available or may result in delays in shipments to its customers. Further, if the Company’s customers’ businesses were similarly affected, they might delay, reduce or cancel purchases from the Company.
Added
In addition, the agreements governing the Company’s other indebtedness do not limit the Company from incurring obligations that do not constitute indebtedness as defined therein.
Removed
If such obligations were to be accelerated, the Company’s financial resources may be insufficient to repay the debt and any other obligations becoming due in full as a result of certain cross default provisions.

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Item 2. Properties

Properties — owned and leased real estate

68 edited+21 added−33 removed60 unchanged
Biggest changeThermal Mining: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Bear Run USA IN P S T 84 10.6 3.1 11,058 52 10.0 2.5 11,045 136 10.4 2.9 11,055 100 % El Segundo/Lee Ranch USA NM P S T 13 15.8 0.9 9,249 1 12.3 0.7 9,526 14 15.6 0.9 9,266 100 % Gateway North USA IL P U T 38 8.9 2.9 10,888 5 9.0 3.0 10,874 43 8.9 2.9 10,886 100 % Twentymile USA CO P U T 10 10.7 0.5 11,280 1 10.2 0.5 11,230 11 10.6 0.5 11,272 100 % Wild Boar USA IN P S T 7 8.3 2.4 11,010 8 8.4 2.7 11,470 15 8.4 2.6 11,265 100 % Francisco Underground USA IN P U T 3 8.7 2.9 11,500 4 9.0 3.3 11,455 7 8.9 3.1 11,480 100 % Total 155 71 226 Grand total 2,056 379 2,435 Stage Mining Method Coal Type P Producing S Surface Mine T Thermal I Idle U Underground Mine C Coking D Development P Pulverized Coal Injection E Exploration Peabody Energy Corporation 2022 Form 10-K 46 Table of Contents SUMMARY COAL RESOURCES AT END OF THE FISCAL YEAR ENDED DECEMBER 31, 2022 (1) (Tons in millions) Measured and Indicated Peabody Mining Coal Measured Coal Resources Indicated Coal Resources Coal Resources Inferred Coal Resources Interest Deposit Country State Stage Method Type Amount Quality Amount Quality Amount Quality Amount Quality (10) Seaborne Thermal Mining: (2)(4) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (5) Wilpinjong AUS NSW P S T 103 23.0 0.5 6,055 25 25.4 0.5 5,860 128 23.5 0.5 6,017 6 27.3 0.5 5,698 100 % Wambo Opencut (9) AUS NSW P S/U T 191 21.6 0.4 5,731 154 21.5 0.4 5,764 345 21.6 0.4 5,746 259 19.9 0.4 5,864 50 % Wambo South AUS NSW E U T/C 219 21.5 0.3 6,068 83 27.2 0.3 5,571 302 23.1 0.3 5,931 47 36.3 0.3 4,745 100 % Total 513 262 775 312 Seaborne Metallurgical Mining: (3)(4) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Shoal Creek USA AL P U C 40 9.6 0.7 25.1 35 9.9 0.7 24.1 75 9.8 0.7 24.6 7 10.3 0.7 24.0 100 % Metropolitan AUS NSW P U C/T 7 15.4 0.4 18.6 8 15.3 0.3 18.7 15 15.3 0.4 18.6 2 16.0 0.3 19.0 100 % Coppabella AUS QLD P S P 13 15.8 0.3 13.1 48 14.3 0.2 12.8 61 14.6 0.2 12.9 73 15.5 0.2 12.3 73.3 % Moorvale AUS QLD P S P 14 18.5 0.3 16.7 14 17.2 0.3 16.6 28 17.9 0.3 16.7 5 15.9 0.3 16.7 73.3 % Moorvale South AUS QLD P S C/P 3 18.3 0.4 18.4 7 18.2 0.4 18.3 10 18.2 0.4 18.3 6 16.8 0.4 17.7 73.3 % NGC GLB2 AUS QLD E U C — — — — 1 15.3 0.6 20.7 1 15.3 0.6 20.7 8 13.6 0.5 20.7 100 % Coppabella North AUS QLD E U P 255 15.8 0.3 14.6 102 16.8 0.3 14.6 357 16.1 0.3 14.6 12 16.5 0.3 14.3 75.5 % Yeerun AUS QLD E S P 16 16.0 0.4 14.3 57 16.2 0.5 15.0 73 16.2 0.4 14.8 46 17.8 0.5 14.7 83.0 % Moorvale North AUS QLD E U P 21 26.0 0.4 12.9 25 24.5 0.5 13.2 46 25.2 0.4 13.1 25 23.2 0.5 13.4 73.3 % Gundyer AUS QLD E U P — — — — 54 16.4 0.2 19.7 54 16.4 0.2 19.7 70 18.3 0.2 18.3 90.0 % Total 369 351 720 254 Powder River Basin Mining: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Caballo USA WY P S T 15 5.3 0.4 8,218 65 5.2 0.4 8,211 80 5.2 0.4 8,212 1 5.5 0.4 8,263 100 % Rawhide USA WY P S T 1 5.4 0.4 8,277 95 5.2 0.3 8,356 96 5.2 0.3 8,355 7 5.7 0.4 8,252 100 % Total 16 160 176 8 Other U.S.
Biggest changeThermal: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Bear Run USA IN P S T 48 10.3 3.1 11,120 24 10.0 2.5 11,100 72 10.2 2.9 11,115 100 % El Segundo/Lee Ranch USA NM P S T 10 16.0 0.9 9,260 1 12.3 0.7 9,526 11 15.7 0.8 9,280 100 % Gateway North USA IL P U T 23 8.8 2.9 10,919 3 8.8 2.9 10,944 26 8.8 2.9 10,922 100 % Twentymile USA CO P U T 8 10.7 0.4 11,277 1 10.6 0.4 11,263 9 10.7 0.5 11,275 100 % Wild Boar USA IN P S T 7 8.4 2.4 10,985 6 8.1 2.8 11,235 13 8.2 2.6 11,110 100 % Francisco Underground USA IN P U T 3 8.8 3.0 11,495 2 8.9 3.2 11,490 5 8.8 3.1 11,493 100 % Total 99 37 136 Grand total 1,788 305 2,093 Stage Mining Method Coal Type P Producing S Surface Mine T Thermal I Idle U Underground Mine C Coking D Development P Pulverized Coal Injection E Exploration Peabody Energy Corporation 2023 Form 10-K 46 Table of Contents SUMMARY COAL RESOURCES AT END OF THE FISCAL YEAR ENDED DECEMBER 31, 2023 (1) (Tons in millions) Measured and Indicated Peabody Mining Coal Measured Coal Resources Indicated Coal Resources Coal Resources Inferred Coal Resources Interest Deposit Country State Stage Method Type Amount Quality Amount Quality Amount Quality Amount Quality (10) Seaborne Thermal: (2)(4) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Wilpinjong AUS NSW P S T 103 23.0 0.5 6,058 25 25.4 0.5 5,861 128 23.5 0.5 6,020 6 27.3 0.5 5,698 100 % Wambo Opencut (9) AUS NSW P S T/C 217 21.2 0.4 5,757 154 21.5 0.4 5,764 371 21.3 0.4 5,760 265 22.0 0.4 5,437 50 % South Wambo AUS NSW E U T/C 219 21.5 0.3 6,068 83 27.2 0.3 5,571 302 23.1 0.3 5,931 47 36.3 0.3 4,745 100 % Total 539 262 801 318 Seaborne Metallurgical: (3)(4) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Shoal Creek USA AL P U C 37 9.6 0.7 25.1 34 9.9 0.7 24.1 71 9.8 0.7 24.6 7 10.3 0.7 24.0 100 % Metropolitan AUS NSW P U C/P/T 7 15.4 0.4 18.6 8 15.3 0.3 18.7 15 15.3 0.4 18.6 2 16.0 0.3 19.0 100 % Coppabella AUS QLD P S P 13 15.8 0.3 13.0 46 14.6 0.3 12.8 59 14.9 0.3 12.8 60 15.7 0.3 12.4 73.3 % Moorvale AUS QLD P S C/P/T 14 18.5 0.3 16.7 14 17.2 0.3 16.6 28 17.9 0.3 16.7 5 15.9 0.3 16.7 73.3 % Moorvale South AUS QLD P S C/P/T 3 18.3 0.4 18.4 7 18.2 0.4 18.3 10 18.2 0.4 18.3 6 16.8 0.4 17.7 73.3 % Centurion (GLB2) AUS QLD E U C — — — — 2 14.8 0.5 20.7 2 14.8 0.5 20.7 8 13.6 0.5 20.7 100 % Coppabella North AUS QLD E U P 255 15.8 0.3 14.6 102 16.8 0.3 14.6 357 16.1 0.3 14.6 12 16.5 0.3 14.3 75.5 % Yeerun AUS QLD E S P 16 16.0 0.4 14.3 57 16.2 0.5 15.0 73 16.2 0.4 14.8 46 17.8 0.5 14.7 83.0 % Moorvale North AUS QLD E U P 21 26.0 0.4 12.9 25 24.5 0.5 13.2 46 25.2 0.4 13.1 25 23.2 0.5 13.4 73.3 % Gundyer AUS QLD E U P — — — — 54 16.4 0.2 19.7 54 16.4 0.2 19.7 70 18.3 0.2 18.3 90.0 % Total 366 349 715 241 Powder River Basin: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Caballo USA WY P S T 120 4.9 0.3 8,500 123 5.0 0.4 8,240 243 5.0 0.4 8,440 2 5.5 0.4 8,255 100 % Rawhide USA WY P S T 21 5.5 0.4 8,150 90 5.2 0.3 8,360 111 5.3 0.4 8,320 7 5.8 0.4 8,250 100 % Total 141 213 354 9 Other U.S.
(2) The cut-off grade and metallurgical recovery are not limiting factors for reserve estimates due to consistent coal thickness and established trends of coal quality in the leased area. The strip ratio increases gradually, but the existing pit length allows an average mineable strip ratio.
(2) The cut-off grade and metallurgical recovery are not limiting factors for coal reserve estimates due to consistent coal thickness and established trends of coal quality in the leased area. The strip ratio increases gradually, but the existing pit length allows an average mineable strip ratio.
(3) The moisture condition for the Seaborne Metallurgical Mining segment coal quality is on an air-dry basis, except for Shoal Creek Mine which is on a dry basis. (4) The quantities for Australian coal reserves are estimated on an as-shipped moisture basis; quantities for Australian coal resources are estimated on an in situ moisture basis.
(3) The moisture condition for the Seaborne Metallurgical segment coal quality is on an air-dry basis, except for the Shoal Creek Mine, which is on a dry basis. (4) The quantities for Australian coal reserves are estimated on an as-shipped moisture basis; quantities for Australian coal resources are estimated on an in situ moisture basis.
The internal controls for reserve and resource estimates also cover exploration activities, sample preparation and analysis, data verification, processing, metallurgical testing, recovery estimation, mine design and sequencing, and reserve and resource evaluations, with environmental, social and regulatory considerations.
The internal controls for coal reserve and resource estimates also cover exploration activities, sample preparation and analysis, data verification, processing, metallurgical testing, recovery estimation, mine design and sequencing, and coal reserve and resource evaluations, with environmental, social and regulatory considerations.
Routine maintenance, overhauls, and necessary capital replacements are generally included in the LOM plan to support future production. Peabody Energy Corporation 2022 Form 10-K 49 Table of Contents The table below presents NARM coal reserve estimates at December 31, 2022, along with comparative quantities at December 31, 2021. NARM did not hold any coal resources as of December 31, 2022.
Routine maintenance, overhauls, and necessary capital replacements are generally included in the LOM plan to support future production. Peabody Energy Corporation 2023 Form 10-K 49 Table of Contents The table below presents NARM coal reserve estimates at December 31, 2023, along with comparative quantities at December 31, 2022. NARM did not hold any coal resources as of December 31, 2023.
As of December 31, 2022, all required licenses and permits were in place for the operations of NARM. The mining operation consists of multiple open pits in four main mining areas, which allows for quality blending and other optimization strategies. Overburden is removed by dragline, truck and shovel, dozer and cast blasting methods.
As of December 31, 2023, all required licenses and permits were in place for the operations of NARM. The mining operation consists of multiple open pits in four main mining areas, which allows for quality blending and other optimization strategies. Overburden is removed by dragline, truck and shovel, dozer and cast blasting methods.
These reserve estimates were supported by the analyses of 4,778 total drill holes within the coal lease area. The quantity of the coal reserves is estimated on a saleable product basis and deemed 100% attributable to Peabody. In addition to quantity, the table presents selected key quality parameters on an as-shipped basis.
These coal reserve estimates were supported by the analyses of 4,869 total drill holes within the coal lease area. The quantity of the coal reserves is estimated on a saleable product basis and deemed 100% attributable to Peabody. In addition to quantity, the table presents selected key quality parameters on an as-shipped basis.
Peabody Energy Corporation 2022 Form 10-K 48 Table of Contents North Antelope Rochelle Mine The North Antelope Rochelle Mine (NARM) is a production-stage surface coal mine located sixty-five miles south of Gillette, Wyoming, USA. NARM is situated in the Gillette Coal Field on the east flank of the Powder River Basin.
Peabody Energy Corporation 2023 Form 10-K 48 Table of Contents North Antelope Rochelle Mine The North Antelope Rochelle Mine (NARM) is a production-stage surface coal mine located sixty-five miles south of Gillette, Wyoming, USA. NARM is situated in the Gillette Coal Field on the east flank of the Powder River Basin.
These reserve and resource estimates were supported by the analyses of 1,178 total drill holes within the coal lease area. The quantity of the coal resources is estimated on an in situ basis as 100% attributable to Peabody. Coal resources are reported exclusive of coal reserves.
These coal reserve and resource estimates were supported by the analyses of 1,271 total drill holes within the coal lease area. The quantity of the coal resources is estimated on an in situ basis as 100% attributable to Peabody. Coal resources are reported exclusive of coal reserves.
The following tables summarize the Company’s estimated coal reserves and resources as of December 31, 2021. The quantity of the coal resources is estimated on an in situ basis as attributable to Peabody. Coal resources are reported exclusive of coal reserves. The quantity of the coal reserves is estimated on a saleable product basis as attributable to Peabody.
The following tables summarize the Company’s estimated coal reserves and resources as of December 31, 2023. The quantity of the coal resources is estimated on an in situ basis as attributable to Peabody. Coal resources are reported exclusive of coal reserves. The quantity of the coal reserves is estimated on a saleable product basis as attributable to Peabody.
The quantity of the coal resources is estimated on an in situ basis as 100% attributable to Peabody. Coal resources are reported exclusive of coal reserves. The quantity of the coal reserves is estimated on a saleable product basis as 100% attributable to Peabody. Coal reserves and resources are reported on selected key quality parameters on an air-dried basis.
The quantity of the coal resources is estimated on an in situ basis as 100% attributable to Peabody. Coal resources are reported exclusive of coal reserves. The quantity of the coal reserves are estimated on a saleable product basis as 100% attributable to Peabody. Coal reserves and resources are reported on selected key quality parameters on an air-dry basis.
(2) The moisture condition for Seaborne Thermal Mining segment coal quality is on an air-dry basis, except for Wambo Opencut, which is estimated on an as-shipped basis for reserves, and an in-situ moisture basis for resources.
(2) The moisture condition for Seaborne Thermal segment coal quality is on an air-dry basis, except for the Wambo Opencut Mine, which is estimated on an as-shipped basis for coal reserves and an in situ moisture basis for coal resources.
The mining industry in the Powder River Basin anchors numerous communities from which the mine attracts qualified personnel. The property, plant, equipment and mine development assets of NARM had a net book value of approximately $417 million at December 31, 2022. The mine’s operating equipment and facilities meet contemporary mining standards and are adequately maintained to execute the LOM plan.
The mining industry in the Powder River Basin anchors numerous communities from which the mine attracts qualified personnel. The property, plant, equipment and mine development assets of NARM had a net book value of approximately $375 million at December 31, 2023. The mine’s operating equipment and facilities meet contemporary mining standards and are adequately maintained to execute the LOM plan.
As of December 31, 2022, the Company leased 1,610 acres of federal land in Alabama, 3,480 acres in Colorado, 282 acres in New Mexico and 38,915 acres in Wyoming, for a total of 44,287 acres nationwide subject to those limitations. The Company also lease coal-mining properties from various state governments in the U.S.
As of December 31, 2023, the Company leased 1,610 acres of federal land in Alabama, 3,480 acres in Colorado, 282 acres in New Mexico and 38,915 acres in Wyoming, for a total of 44,287 acres nationwide subject to those limitations. The Company also leases coal-mining properties from various state governments in the U.S.
Peabody Energy Corporation 2022 Form 10-K 52 Table of Contents Wilpinjong Mine The Wilpinjong Mine is a production-stage surface thermal coal mine situated approximately 25 miles northeast of Mudgee in New South Wales, Australia. Peabody acquired the mine as part of its acquisition of Excel Coal Pty Ltd (Excel) in 2006.
Peabody Energy Corporation 2023 Form 10-K 50 Table of Contents Wilpinjong Mine The Wilpinjong Mine is a production-stage surface thermal coal mine situated approximately 25 miles northeast of Mudgee in New South Wales, Australia. Peabody acquired the mine as part of its acquisition of Excel Coal Pty Ltd (Excel) in 2006.
(1) Economic recoverability is based upon product-specific estimated average sales prices per ton of $51.99 for the five-year period ending December 31, 2027 and assumed escalation of 2.0% to 3.0% per annum during the subsequent period through the end of the LOM plan. (2) The quality of coal resources is on an in situ , air-dry basis.
(1) Economic recoverability is based upon product-specific estimated average sales prices per tonne of $51.65 for the five-year period ending December 31, 2028 and assumed escalation of 2.0% to 3.0% per annum during the subsequent period through the end of the LOM plan. (2) The quality of coal resources is on an in situ , air-dry basis.
The mine’s proximity to other large coal producers in the region provides access to a significant pool of experienced mining personnel. Peabody Energy Corporation 2022 Form 10-K 53 Table of Contents The property, plant, equipment and mine development assets of Wilpinjong Mine had a net book value of approximately $342 million at December 31, 2022.
The mine’s proximity to other large coal producers in the region provides access to a significant pool of experienced mining personnel. Peabody Energy Corporation 2023 Form 10-K 51 Table of Contents The property, plant, equipment and mine development assets of Wilpinjong Mine had a net book value of approximately $307 million at December 31, 2023.
The information that follows relating to such individually material mines is derived, for the most part, from, and in some instances is an extract from, the studies relating to such properties prepared in compliance with the Item 601(b)(96) and subpart 1300 of Regulation S-K.
The information that follows relating to such individually material mines is derived, for the most part, from, and in some instances is an extract from, the technical report summaries (TRSs) relating to such properties prepared in compliance with the Item 601(b)(96) and subpart 1300 of Regulation S-K.
(2) The quality of coal resources is estimated on an in situ , air-dry basis. (3) The quantity of coal resource is estimated on an in situ basis, which doesn’t take into consideration coal loss during mining and processing.
(2) The quality of coal reserves and resources are estimated on an air-dry basis. (3) The quantity of coal resource estimates are on an in situ basis, which doesn’t take into consideration coal loss during mining and processing.
(1) Economic recoverability is based upon an estimated average sales price per ton of $14.64 for the five-year period ending December 31, 2027 and assumed escalation of 2.0% per annum during the subsequent period through the end of the LOM plan.
(1) Economic recoverability is based upon an estimated average sales price per ton of $15.00 for the five-year period ending December 31, 2028 and assumed escalation of 2.0% per annum during the subsequent period through the end of the LOM plan.
In addition to the factors noted above, the prices which may be obtained at each mine or future mine can be impacted by factors such as (i) the mine’s location, which impacts the total delivered energy costs to its customers, (ii) quality characteristics, particularly if they are unique relative to competing mines, (iii) assumed transportation costs and (iv) other mine costs that are contractually passed on to customers in certain commercial relationships.
Peabody Energy Corporation 2023 Form 10-K 44 Table of Contents In addition to the factors noted above, the prices which may be obtained at each mine or future mine can be impacted by factors such as (i) the mine’s location, which impacts the total delivered energy costs to its customers, (ii) quality characteristics, particularly if they are unique relative to competing mines, (iii) assumed transportation costs and (iv) other mine costs that are contractually passed on to customers in certain commercial relationships.
The quantity of the coal reserves is estimated on a saleable product basis as 73.3% attributable to Peabody. Coal reserves and resources are reported on selected key quality parameters on an air-dry basis.
The quantity of the coal reserves is estimated on a saleable product basis as 100% attributable to Peabody. Coal reserves and resources are reported on selected key quality parameters on an air-dried basis.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations.”) Qualitative factors may include, as applicable, strategic priorities, the regulatory environment, capital expansion plans, and the long-term pricing outlook. The Company concluded that, as of December 31, 2021, its individually material mines are North Antelope Rochelle Mine (NARM), Shoal Creek Mine, Wilpinjong Mine, and the Coppabella-Moorvale Joint Venture.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations.”) Qualitative factors may include, as applicable, strategic priorities, the regulatory environment, capital expansion plans, and the long-term pricing outlook. The Company concluded that as of December 31, 2023, its individually material mines are North Antelope Rochelle Mine (NARM), Wilpinjong Mine and Centurion Mine.
The CMJV’s operating equipment meets contemporary mining standards and is adequately maintained to execute the mine plan. Routine maintenance, overhauls and necessary capital replacements are generally included in the LOM plan to support future production. The tables below present estimates of the CMJV coal reserves and resources as of December 31, 2022, along with comparative quantities at December 31, 2021.
The mine’s operating equipment meets contemporary mining standards and is adequately maintained to execute the LOM plan. Routine maintenance, overhauls and necessary capital replacements are generally included in the LOM plan to support future production. The tables below present Wilpinjong Mine’s estimated coal reserves and resources at December 31, 2023, along with comparative quantities at December 31, 2022.
Peabody Energy Corporation 2022 Form 10-K 41 Table of Contents Coal resources are estimated from geological models constructed from an extensive historical database of drill holes and the Company’s ongoing drilling program. Data from individual drill holes is compiled in a computerized drill-hole database, including the depth, thickness and, where core drilling is used, the quality of the coal observed.
Coal resources are estimated from geological models constructed from an extensive historical database of drill holes and the Company’s ongoing drilling program. Data from individual drill holes is compiled in a computerized drill-hole database, including the depth, thickness and, where core drilling is used, the quality of the coal observed.
(5) The cut-off grade and metallurgical recovery are not limiting factors for the reserve and resource estimates due to relatively consistent coal quality and float recovery from the lab results within the assessed area.
(5) The cut-off grade and metallurgical recovery are not limiting factors for the coal reserve and resource estimates due to relatively consistent coal quality and float recovery from the lab results within the assessed area. The Lease boundary, surface infrastructures, and the base of weathering are the main limiting factors.
The range of variability of the moisture content in coal may affect the actual shipped Btu content. (9) Reserve and resource data is maintained and provided by joint venture managing partners utilizing the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. (10) The quantities of reserves and resources are disclosed at Peabody’s proportional ownership share.
(9) Reserve and resource data is maintained and provided by joint venture managing partners utilizing the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. (10) The quantities of coal reserves and resources are disclosed at Peabody’s proportional ownership share.
WILPINJONG MINE - SUMMARY OF RESERVES AND RESOURCES (1) (Tons in millions) December 31, 2022 December 31, 2021 Coal Reserves (5)(6) Tons %Ash %Sulfur Kcal/kg % Mine Yield (7) Tons Proven 63 24.2 0.5 5,953 82 % 71 Probable 4 30.4 0.4 5,422 82 % 5 Total 67 76 Year-over-year decrease (12) % December 31, 2022 December 31, 2021 Coal Resources (2)(3)(4) Tons %Ash %Sulfur Kcal/kg Tons Measured 103 23.0 0.5 6,055 103 Indicated 25 25.4 0.5 5,860 25 Measured and indicated 128 23.5 0.5 6,017 128 Inferred 6 27.3 0.5 5,698 6 Total 134 134 The year-over-year decrease in the quantity of coal reserves was driven by production depletion.
WILPINJONG MINE - SUMMARY OF COAL RESERVES AND RESOURCES (1) (Tons in millions) December 31, 2023 December 31, 2022 Coal Reserves (5)(6) Tons %Ash %Sulfur Kcal/kg % Mine Yield (7) Tons Proven 54 24.2 0.5 5,953 82 % 63 Probable 3 30.3 0.4 5,431 82 % 4 Total 57 67 Year-over-year decrease (15) % December 31, 2023 December 31, 2022 Coal Resources (2)(3)(4) Tons %Ash %Sulfur Kcal/kg Tons Measured 103 23.0 0.5 6,058 103 Indicated 25 25.4 0.5 5,861 25 Measured and indicated 128 23.5 0.5 6,020 128 Inferred 6 27.3 0.5 5,698 6 Total 134 134 The year-over-year decrease in the quantity of coal reserves was driven by production depletion.
The Company holds the majority of the required surface rights to meet mid- to long-term production requirements. The additional surface rights to meet long-term production requirements are expected to be acquired as needed. Peabody Energy Corporation 2022 Form 10-K 42 Table of Contents The Company is party to numerous U.S. federal coal leases that are administered by the U.S.
The Company holds the majority of the required surface rights to meet mid- to long-term production requirements. The additional surface rights to meet long-term production requirements are expected to be acquired as needed. The Company is party to numerous U.S. federal coal leases that are administered by the U.S.
Peabody Energy Corporation 2022 Form 10-K 44 Table of Contents Costs The cost estimates used to establish LOM plans are generally made according to internal processes that project future costs based on historical costs and expected trends. The estimated costs normally include mining, processing, transportation, royalty, add-on tax and other mining-related costs.
Costs The cost estimates used to establish LOM plans are generally made according to internal processes that project future costs based on historical costs and expected trends. The estimated costs normally include mining, processing, transportation, royalty, add-on tax and other mining-related costs.
Summary of Coal Reserves and Resources Peabody controlled an estimated 2.4 billion tons of coal reserves and 2.4 billion tons of coal resources as of December 31, 2022. Approximately 95% of the Company’s coal reserves and 98% of the Company’s coal resources are held under lease, and the remainder is held through fee ownership.
Summary of Coal Reserves and Resources Peabody controlled an estimated 2.1 billion tons of coal reserves and 2.7 billion tons of coal resources as of December 31, 2023. Approximately 97% of the Company’s coal reserves and 94% of the Company’s coal resources are held under lease, and the remainder is held through fee ownership.
For US domestic thermal mines, the estimated sales prices for the same period range from approximately $10.42 to $59.69 per ton. Subsequent to 2027, for all mines, sales price escalation is assumed at 2.0% to 3.0% per annum through the end of each LOM plan.
For U.S. domestic thermal mines, the estimated sales prices for the same period range from approximately $10.44 to $70.52 per ton. Subsequent to 2028, for all mines, sales price escalation is assumed at 2.0% to 3.0% per annum through the end of each LOM plan.
NARM - SUMMARY OF RESERVES (1) (Tons in millions) December 31, 2022 December 31, 2021 Coal Reserves (2)(3)(4) Tons %Ash %Sulfur Btu % Mine Yield (5) Tons Proven 1,316 4.4 0.2 8,889 100 % 1,378 Probable 107 4.5 0.2 8,965 100 % 106 Total 1,423 1,484 Year-over-year decrease (4) % The year-over-year decrease in the quantity of coal reserves was driven by production depletion.
NARM - SUMMARY OF COAL RESERVES (1) (Tons in millions) December 31, 2023 December 31, 2022 Coal Reserves (2)(3)(4) Tons %Ash %Sulfur Btu % Mine Yield (5) Tons Proven 1,261 4.6 0.2 8,880 100 % 1,316 Probable 103 4.7 0.2 8,885 100 % 107 Total 1,364 1,423 Year-over-year decrease (4) % The year-over-year decrease in the quantity of coal reserves was driven by production depletion.
Item 2. Properties. Coal Reserves and Resources Information concerning the Company’s mining properties in this Annual Report on Form 10-K has been prepared in accordance with the requirements of subpart 1300 of Regulation S-K, which first became applicable to the Company for the year ended December 31, 2021.
Item 2. Properties. Coal Reserves and Resources Information concerning the Company’s mining properties in this Annual Report on Form 10-K has been prepared in accordance with the requirements of subpart 1300 of Regulation S-K.
For the five-year period 2023 through 2027, the estimated sales prices for seaborne metallurgical mines are based upon estimated premium hard coking coal benchmark prices ranging from $172 to $227 per tonne. The estimated sales prices for seaborne thermal mines are based upon estimated Newcastle benchmark prices ranging from $86 to $224 per tonne for the same period.
For the five-year period 2024 through 2028, the estimated sales prices for seaborne metallurgical mines are based upon estimated premium hard coking coal benchmark prices ranging from $180 to $239 per tonne. The estimated sales prices for seaborne thermal mines are based upon estimated Newcastle benchmark prices ranging from $92 to $128 per tonne for the same period.
The tables below present Wilpinjong Mine’s estimated coal reserves and resources at December 31, 2022, along with comparative quantities at December 31, 2021. These reserve and resource estimates were supported by the analyses of 1,271 total drill holes within the coal lease area.
Peabody Energy Corporation 2023 Form 10-K 54 Table of Contents The tables below present Centurion Mine’s estimated coal reserves and resources at December 31, 2023, along with comparative quantities at December 31, 2022. These coal reserve and resource estimates were supported by the analyses of 1,776 total drill holes within the coal lease area.
The terms of private U.S. leases are normally extended by active production at or near the end of the lease term. Private U.S. leases containing undeveloped coal properties may expire or these leases may be renewed periodically. Mining and exploration in Australia are generally carried out under leases or licenses granted by state governments.
The terms of private U.S. leases are normally extended by active production at or near the end of the lease term. Private U.S. leases containing undeveloped coal properties may expire or these leases may be renewed periodically.
Conventional open cut mining methods are used at the Wilpinjong Coal Mine, with multiple pits at a low strip ratio allowing for relatively rapid pit advance. Overburden is removed by a combination of cast blasting, doze, and truck and shovel methods.
As of December 31, 2023, all required licenses and permits were in place for the operations of Wilpinjong. Conventional open cut mining methods are used at the Wilpinjong Coal Mine, with multiple pits at a low strip ratio allowing for relatively rapid pit advance. Overburden is removed by a combination of cast blasting, dozer, and truck and excavator methods.
A concentration or occurrence of material of economic interest in or on the earth's crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction.
Mineral resources and reserves are defined in subpart 1300 of Regulation S-K as follows: • Mineral resource. A concentration or occurrence of material of economic interest in or on the earth's crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction.
The level of geological uncertainty associated with an inferred mineral resource is too high to apply relevant technical and economic factors likely to influence the prospects of economic extraction in a manner useful for evaluation of economic viability. The geological confidence surrounding resource classification is first determined by a drill hole spacing analysis performed by a QP using geostatistical techniques.
The level of geological uncertainty associated with an inferred mineral resource is too high to apply relevant technical and economic factors likely to influence the prospects of economic extraction in a manner useful for evaluation of economic viability.
Peabody Energy Corporation 2022 Form 10-K 43 Table of Contents Internationally, thermal coal-fueled generation also competes with alternative forms of electricity generation. The competitiveness and availability of generation fueled by natural gas, oil, nuclear, hydro, wind, solar and biomass vary by country and region and can have a meaningful impact on coal pricing.
Internationally, thermal coal-fueled generation also competes with alternative forms of electricity generation. The competitiveness and availability of generation fueled by natural gas, oil, nuclear, hydro, wind, solar and biomass vary by country and region and can have a meaningful impact on coal pricing. Policy and regulations, which vary from country to country, can also influence prices.
The LOM plans project, among other things, annual quantities and qualities for each coal product. The saleable product mix for a mine may include multiple thermal and metallurgical products with different targeted qualities and sales prices.
The saleable product mix for a mine may include multiple thermal and metallurgical products with different targeted qualities and sales prices.
Portions of the following information are based on assumptions, qualifications and procedures that are not fully described herein. The changes from the previous year are not material and no updates for TRS are included in this filing. Other technical details regarding the individual properties should be referred to the previously disclosed TRS.
Portions of the following information are based on assumptions, qualifications and procedures that are not fully described herein. The changes for NARM from the previous years are not material and no updates for the TRS are included in this filing.
The Company’s coal reserves and resources are estimated by individuals deemed Qualified Persons (QP) according to the standards set forth in subpart 1300 of Regulation S-K. Mineral resources and reserves are defined in subpart 1300 of Regulation S-K as follows: • Mineral resource.
Subpart 1300 of Regulation S-K requires disclosure of mineral resources, in addition to mineral reserves, both in the aggregate and for each of the Company’s individually material mining properties. The Company’s coal reserves and resources are estimated by individuals deemed Qualified Persons (QP) according to the standards set forth in subpart 1300 of Regulation S-K.
Such controls employ management systems, standardized procedures, workflow processes, multi-functional supervision and management approval, internal and external reviews, reconciliations, and data security covering record keeping, chain of custody and data storage.
Annually, QPs and other employees review the estimates of mineral reserves and mineral resources, the supporting documentation, and compliance with applicable internal controls. Such controls employ management systems, standardized procedures, workflow processes, multi-functional supervision and management approval, internal and external reviews, reconciliations, and data security covering record keeping, chain of custody and data storage.
The reserve and resource estimates have inherent risks due to data accuracy, uncertainty from geological interpretation, mine plan assumptions, uncontrolled rights for mineral and surface properties, environmental challenges, uncertainty for future market supply and demand, and changes in laws and regulations. Management and QPs are aware of those risks that might directly impact the assessment of coal reserves and resources.
Peabody Energy Corporation 2023 Form 10-K 55 Table of Contents The coal reserve and resource estimates have inherent risks due to data accuracy, uncertainty from geological interpretation, mine plan assumptions, uncontrolled rights for mineral and surface properties, environmental challenges, uncertainty for future market supply and demand, and changes in laws and regulations.
(6) The quantity of coal reserves is estimated on a saleable product basis which takes into consideration of mining and processing loss. The economic results from the LOM planning process demonstrate the economic viability of the coal reserve estimate. (7) Mine yield is the ratio of estimated saleable product coal over ROM coal tons with mainly processing loss considered.
(6) The quantity of coal reserves is estimated on a saleable product basis, which takes into consideration of unmined coal (pillars, etc.), coal loss during mining and processing, and additional washing recovery. The results from the LOM planning process demonstrate the economic recoverability of the coal reserve estimate.
The current coal reserves and resources are estimated based on the best information available and are subject to re-assessment when conditions change. Refer to Item 1A. “Risk Factors” for discussion of risks associated with the estimates of the Company’s reserves and resources.
Management and QPs are aware of those risks that might directly impact the assessment of coal reserves and resources. The current coal reserves and resources are estimated based on the best information available and are subject to re-assessment when conditions change. Refer to Item 1A.
Surface rights are typically acquired directly from landowners through agreement or court determination, subject to some exceptions. Pricing The pricing information used in support of the Company’s reserve and resource estimates include internal, proprietary price forecasts and existing contract economics, in each case on a mine-by-mine and product-by-product basis.
Pricing The pricing information used in support of the Company’s coal reserve and resource estimates include internal, proprietary price forecasts and existing contract economics, in each case on a mine-by-mine and product-by-product basis.
The cut-off criteria of those structure and quality parameters are different for each deposit, and a QP generally forms those criteria based upon experience with the Company’s existing mining operations or adjacent operations with similar geological conditions. Other factors, such as coal control, or surface and underground obstacles are also considered in connection with resource estimates.
Each coal deposit is different with respect to geology, potential mining methods, logistics, and markets. The cut-off criteria of those structure and quality parameters are different for each deposit, and a QP generally forms those criteria based upon experience with the Company’s existing mining operations or adjacent operations with similar geological conditions.
Peabody Energy Corporation 2022 Form 10-K 45 Table of Contents SUMMARY COAL RESERVES AT END OF THE FISCAL YEAR ENDED DECEMBER 31, 2022 (1) (Tons in millions) Peabody Mining Coal Proven Coal Reserves Probable Coal Reserves Total Coal Reserves Interest Segment / Mining Complex Country State Stage Method Type Amount Quality Amount Quality Amount Quality (10) Seaborne Thermal Mining: (2)(4) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Wilpinjong AUS NSW P S T 63 24.2 0.5 5,953 4 30.4 0.4 5,422 67 24.5 0.5 5,924 100 % Wambo Opencut (9) AUS NSW P S T 29 10.9 0.3 6,448 2 10.6 0.3 6,478 31 10.9 0.3 6,450 50 % Wambo Underground AUS NSW P U T 2 13.7 0.4 6,473 3 12.2 0.4 6,588 5 12.9 0.4 6,534 100 % South Wambo AUS NSW E U T/C — — — — 74 9.8 0.3 7,034 74 9.8 0.3 7,034 100 % Total 94 83 177 Seaborne Metallurgical Mining: (3)(4) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Shoal Creek USA AL P U C 15 10.0 0.7 30.2 2 10.0 0.7 30.2 17 10.0 0.7 30.2 100 % Coppabella AUS QLD P S P 6 9.3 0.2 9.9 4 9.8 0.2 8.5 10 9.5 0.2 9.3 73.3 % Moorvale AUS QLD P S C/P/T 4 11.4 0.3 16.5 — — — — 4 11.4 0.3 16.5 73.3 % Metropolitan AUS NSW P U C/T 3 13.9 0.4 18.6 7 13.8 0.4 18.7 10 13.8 0.4 18.6 100 % North Goonyella AUS QLD D U C 46 7.4 0.5 21.4 24 7.5 0.5 21.1 70 7.4 0.5 21.3 100 % Moorvale South AUS QLD P S C/P 3 11.1 0.4 18.4 2 9.8 0.4 17.4 5 10.6 0.4 18.0 73.3 % Middlemount (9) AUS QLD P S C/P 25 10.3 0.4 18.0 9 10.3 0.4 18.0 34 10.3 0.4 18.0 50.0 % Total 102 48 150 Powder River Basin Mining: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) North Antelope Rochelle USA WY P S T 1,316 4.4 0.2 8,889 107 4.5 0.2 8,965 1,423 4.4 0.2 8,895 100 % Caballo USA WY P S T 274 5.1 0.3 8,517 68 5.6 0.3 8,313 342 5.2 0.3 8,476 100 % Rawhide USA WY P S T 115 5.6 0.4 8,278 2 5.2 0.3 8,362 117 5.6 0.4 8,279 100 % Total 1,705 177 1,882 Other U.S.
Peabody Energy Corporation 2023 Form 10-K 45 Table of Contents SUMMARY COAL RESERVES AT END OF THE FISCAL YEAR ENDED DECEMBER 31, 2023 (1) (Tons in millions) Peabody Mining Coal Proven Coal Reserves Probable Coal Reserves Total Coal Reserves Interest Segment / Mining Complex Country State Stage Method Type Amount Quality Amount Quality Amount Quality (10) Seaborne Thermal: (2)(4) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Tons %Ash %Sulfur Kcal/kg (6) Wilpinjong AUS NSW P S T 54 24.2 0.5 5,953 3 30.3 0.4 5,431 57 24.5 0.5 5,925 100 % Wambo Opencut (9) AUS NSW P S T/C 24 11.2 0.3 6,425 1 11.3 0.3 6,418 25 11.2 0.3 6,425 50 % Wambo Underground AUS NSW P U T/C 1 12.8 0.4 6,473 3 12.3 0.4 6,588 4 12.4 0.4 6,559 100 % South Wambo AUS NSW E U T/C — — — — 74 9.8 0.3 7,034 74 9.8 0.3 7,034 100 % Total 79 81 160 Seaborne Metallurgical: (3)(4) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Tons %Ash %Sulfur VM% (7) Shoal Creek USA AL P U C 15 9.6 0.7 30.4 2 9.7 0.7 30.2 17 9.6 0.7 30.3 100 % Coppabella AUS QLD P S P 7 9.3 0.2 10.2 15 9.5 0.2 10.0 22 9.4 0.2 10.1 73.3 % Moorvale AUS QLD P S C/P/T 4 11.4 0.3 16.5 — — — — 4 11.4 0.3 16.5 73.3 % Metropolitan AUS NSW P U C/P/T 1 11.7 0.4 18.6 9 11.7 0.4 18.4 10 11.7 0.4 18.4 100 % Centurion AUS QLD D U C 46 7.4 0.5 20.9 23 7.5 0.5 21.1 69 7.4 0.5 21.0 100 % Moorvale South AUS QLD P S C/P/T 3 11.1 0.4 18.5 2 9.8 0.4 17.5 5 10.6 0.4 18.1 73.3 % Middlemount (9) AUS QLD P S C/P 26 10.3 0.4 18.0 10 10.3 0.4 18.0 36 10.3 0.4 18.0 50.0 % Total 102 61 163 Powder River Basin: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) North Antelope Rochelle USA WY P S T 1,261 4.6 0.2 8,880 103 4.7 0.2 8,885 1,364 4.6 0.2 8,880 100 % Caballo USA WY P S T 160 5.2 0.3 8,495 20 5.5 0.4 8,325 180 5.2 0.3 8,475 100 % Rawhide USA WY P S T 87 5.5 0.4 8,300 3 5.7 0.3 8,310 90 5.5 0.3 8,300 100 % Total 1,508 126 1,634 Other U.S.
A QP may also use qualitative analysis to determine the geologic confidence based on historical experience with a specific coal deposit. Resources are further evaluated using a set of structure and quality parameters to determine the reasonable prospects for economic extraction. The structure parameters include coal thickness, depth, dipping angle, and strip ratio, among others.
Resources are further evaluated using a set of structure and quality parameters to determine the reasonable prospects for economic extraction. The structure parameters include coal thickness, depth, dipping angle, and strip ratio, among others. The quality parameters include ash and sulfur content, yield, and heat value, among others.
QPs rely on LOM planning as an integral process for coal reserve and resource estimates. The LOM plans consider dilution and losses during mining and processing as recoverability factors to estimate saleable coal. The LOM plans are developed in consideration of market demands and operational constraints.
The LOM plans consider dilution and losses during mining and processing as recoverability factors to estimate saleable coal. The LOM plans are developed in consideration of market demands and operational constraints. The LOM plans project, among other things, annual quantities and qualities for each coal product.
(7) VM (volatile matter) represents the proportion of certain organic and mineral components in coal, for example, water, carbon dioxide, or sulfur dioxide. Volatile matter is inversely related to coal rank. (8) Btu (British thermal unit) is the gross heating value of coal per pound, which includes the weight of moisture in coal on an as-sold basis.
(6) Kcal/kg (kilocalories per kilogram) is the net calorific value (net heating value) of coal, except for the Wambo Opencut Mine which is estimated as gross calorific value. (7) VM (volatile matter) represents the proportion of certain organic and mineral components in coal, for example, water, carbon dioxide or sulfur dioxide. Volatile matter is inversely related to coal rank.
(3) The quantity of resource estimates are on an in situ basis, which doesn’t take into consideration coal loss during mining and processing. (4) The coal resource boundary is established by considering various factors, including results from drill hole analyses, coal control, geological features, faults and other surface features.
(4) The coal resource boundary is established by considering various factors, including results from drill hole analyses, mining lease, coal control, geological features, faults and other surface features.
(5) The quality and quantity estimates for U.S. thermal reserves are calculated on as-shipped moisture basis; the quality and quantity estimates for U.S. thermal resources are calculated on an in situ moisture basis. (6) Kcal/kg (kilocalories per kilogram) is the net calorific value (net heating value) of coal, except for Wambo Opencut which is estimated as gross calorific value.
(5) The quality and quantity estimates for U.S. thermal coal reserves are calculated on as-shipped moisture basis; the quality and quantity estimates for U.S. thermal coal resources are calculated on an in situ moisture basis.
The economically mineable part of indicated, and sometimes measured, coal resources are considered probable coal reserves and have a moderate degree of assurance of economic viability. For each mine or future mine, the Company develops Life-of-Mine (LOM) plans which employ a market-driven, risk-adjusted capital allocation process to guide long-term mine planning of active operations and development projects.
For each mine or future mine, the Company develops Life-of-Mine (LOM) plans which employ a market-driven, risk-adjusted capital allocation process to guide long-term mine planning of active operations and development projects. QPs rely on LOM planning as an integral process for coal reserve and resource estimates.
The Company has secured three exploration licenses of 3,186 hectares and three mining licenses of 3,723 hectares through the New South Wales Minister of Planning. The typical royalty rate is 8.2% of the value of coal recovered. The mining licenses require renewal upon expiration in 2027 for 2,863 hectares and in 2039-2040 for 860 acres.
The Company has secured three exploration licenses of 2,958 hectares and four mining leases of 3,790 hectares through the New South Wales Minister of Planning. The typical royalty rate is 8.2% currently, increasing to 10.8% in July of 2024, of the value of coal recovered.
Internal Controls The preparation of coal reserve and resource estimates is completed in accordance with the Company’s prescribed internal control procedures, which are designed specifically to ensure the reliability of such estimates presented herein. Annually, QPs and other employees review the estimates of mineral reserves and mineral resources, the supporting documentation, and compliance with applicable internal controls.
(7) Mine yield is the ratio of estimated saleable product coal over ROM coal tons with mainly processing loss considered. Internal Controls The preparation of coal reserve and resource estimates is completed in accordance with the Company’s prescribed internal control procedures, which are designed specifically to ensure the reliability of such estimates presented herein.
Thermal Mining: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Bear Run USA IN P S T 18 14.6 3.5 10,860 51 16.8 3.5 10,450 69 16.3 3.5 10,550 37 16.3 3.5 10,545 100 % El Segundo/Lee Ranch USA NM P S T 1 17.1 1.1 9,491 5 16.5 1.0 9,475 6 16.6 1.0 9,478 2 17.4 1.2 9,280 100 % Wild Boar USA IN P S T — — — — 3 12.9 6.1 10,940 3 12.9 5.4 11,020 1 12.9 5.9 10,960 100 % Total 19 59 78 40 Grand total 917 832 1,749 614 Peabody Energy Corporation 2022 Form 10-K 47 Table of Contents (1) The sales price assumptions supporting economic recoverability vary depending upon factors such as coal quality and existing customer volume commitments.
Thermal: (5) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Tons %Ash %Sulfur Btu (8) Bear Run USA IN P S T 73 14.7 3.9 10,800 89 16.6 3.7 10,490 162 15.8 3.8 10,630 29 15.9 3.5 10,600 100 % Francisco Underground USA IN P U T 2 13.8 4.7 11,325 5 12.5 4.7 11,540 7 13.1 4.7 11,440 — — — — 100 % Gateway North USA IL P U T 25 13.1 3.9 10,583 17 13.1 3.9 10,583 42 13.1 3.9 10,583 — — — — 100 % El Segundo/Lee Ranch USA NM P S T 1 13.5 1.0 9,932 5 12.1 0.9 10,036 6 12.4 1.0 10,014 2 14.3 1.2 9,655 100 % Wild Boar USA IN P S T — — — — 3 11.7 5.5 11,390 3 11.7 5.5 11,390 1 12.0 5.5 11,290 100 % Total 101 119 220 32 Grand total 1,147 943 2,090 600 Peabody Energy Corporation 2023 Form 10-K 47 Table of Contents (1) The sales price assumptions supporting economic recoverability vary depending upon factors such as coal quality and existing customer volume commitments.
Mining leases are typically for an initial term of up to 21 years (but which may be renewed) and contain conditions relating to such matters as minimum annual expenditures, restoration and rehabilitation. Royalties are paid to the state government as a percentage of the sales price.
Peabody Energy Corporation 2023 Form 10-K 43 Table of Contents Mining and exploration in Australia are generally carried out under leases or licenses granted by state governments. Mining leases are typically for an initial term of up to 21 years (but which may be renewed) and contain conditions relating to such matters as minimum annual expenditures, restoration and rehabilitation.
The reclassification of reported mineral resources from lower to higher levels of geological confidence should not be assumed. The economically mineable part of a measured coal resource is considered a proven coal reserve and has the highest degree of assurance of economic viability.
The economically mineable part of a measured coal resource is considered a proven coal reserve and has the highest degree of assurance of economic viability. The economically mineable part of indicated, and sometimes measured, coal resources are considered probable coal reserves and have a moderate degree of assurance of economic viability.
Generally, landowners do not own the mineral rights or have the ability to grant rights to mine those minerals. These rights are retained by state governments. Compensation is payable to landowners for loss of access to the land, and the amount of compensation can be determined by agreement or court process.
Royalties are paid to the state government as a percentage of the sales price. Generally, landowners do not own the mineral rights or have the ability to grant rights to mine those minerals. These rights are retained by state governments.
(7) Mine yield is the ratio of estimated saleable product coal over ROM coal tons with mainly processing loss considered. Peabody Energy Corporation 2022 Form 10-K 54 Table of Contents Coppabella-Moorvale Joint Venture The Company’s Coppabella Moorvale Joint Venture (CMJV) mines are located approximately 75 miles southwest of Mackay, near the township of Coppabella, in central Queensland, Australia.
(7) Mine yield is the ratio of estimated saleable product coal over ROM coal tons with mainly processing loss considered. Peabody Energy Corporation 2023 Form 10-K 52 Table of Contents Centurion Mine The Centurion Mine, which is currently undergoing redevelopment, is an underground longwall metallurgical coal mine located 160 kilometers WSW of Mackay, Queensland, Australia.
SHOAL CREEK MINE - SUMMARY OF RESERVES AND RESOURCES (1) (Tons in millions) December 31, 2022 December 31, 2021 Coal Reserves (2)(4)(5)(6) Tons %Ash %Sulfur %VM % Mine Yield (7) Tons Proven 15 10.0 0.7 30.2 36 % 16 Probable 2 10.0 0.7 30.2 36 % 2 Total 17 18 Year-over-year decrease (6) % December 31, 2022 December 31, 2021 Coal Resources (2)(3)(4)(5) Tons %Ash %Sulfur VM% Tons Measured 40 9.6 0.7 25.1 40 Indicated 35 9.9 0.7 24.1 35 Measured and indicated 75 9.8 0.7 24.6 75 Inferred 7 10.2 0.7 24.0 7 Total 82 82 The year-over-year decrease in coal reserves reflects 2022 production depletion.
CENTURION MINE - SUMMARY OF COAL RESERVES AND RESOURCES (1) (Tons in millions) December 31, 2023 December 31, 2022 Coal Reserves (2)(5)(6) Tons %Ash %Sulfur %VM % Mine Yield (7) Tons Proven 46 7.4 0.5 20.9 82 % 46 Probable 23 7.5 0.5 21.1 82 % 24 Total 69 70 Year-over-year decrease (1) % December 31, 2023 December 31, 2022 Coal Resources (2)(3)(4)(5) Tons %Ash %Sulfur VM% Tons Measured — — — — — Indicated 2 14.8 0.5 20.7 1 Measured and indicated 2 14.8 0.5 20.7 1 Inferred 8 13.6 0.5 20.7 8 Total 10 9 (1) Economic recoverability is based upon an estimated average sales price per tonne of $180 for most of the LOM plan.
The mine’s operating equipment and facilities meet contemporary mining standards and are adequately maintained to execute the LOM plan. Routine maintenance, overhauls and necessary capital replacements are generally included in the LOM plan to support future production.
Routine maintenance, overhauls and necessary capital replacements are generally included in the LOM plan to support future production. While the mine was idled since 2018, the Company upgraded the mine’s coal transfer and handling facilities, purchased new mining equipment and made other capital investments to improve its prospective cost structure.
The renewal application for two exploration licenses is currently pending approval and the third was granted in May 2022 for an initial term of 6 years. As of December 31, 2022, all required licenses and permits were in place for the operations of Wilpinjong.
The mining leases require renewal upon expiration in 2027 for 2,863 hectares and in 2039-2044 for 927 hectares. Renewal applications for two exploration licenses were approved in 2023, with the terms extended to December 2027 and March 2028, and the third was granted in May 2022 for an initial term of 6 years.
The Company also assesses material changes in the material properties mainly on the basis of the amount of reserves and resources over a period of three years. The Company concluded that, as of December 31, 2022, its material mining operations had no material changes. The Company will update its assessment of individually material mines on an annual basis.
The Company will update its assessment of individually material mines on an annual basis.
Removed
These requirements differ significantly from the previously applicable disclosure requirements of SEC Industry Guide 7. Among other differences, subpart 1300 of Regulation S-K requires disclosure of mineral resources, in addition to mineral reserves, both in the aggregate and for each of the Company’s individually material mining properties.
Added
Peabody Energy Corporation 2023 Form 10-K 42 Table of Contents The geological confidence surrounding resource classification is first determined by a drill hole spacing analysis performed by a QP using geostatistical techniques. A QP may also use qualitative analysis to determine the geologic confidence based on historical experience with a specific coal deposit.
Removed
The quality parameters include ash and sulfur content, yield, and heat value, among others. Each coal deposit is different with respect to geology, potential mining methods, logistics, and markets.
Added
Other factors, such as coal control, or surface and underground obstacles are also considered in connection with resource estimates. The reclassification of reported mineral resources from lower to higher levels of geological confidence should not be assumed.
Removed
Policy and regulations, which vary from country to country, can also influence prices.
Added
Compensation is payable to landowners for loss of access to the land, and the amount of compensation can be determined by agreement or court process. Surface rights are typically acquired directly from landowners through agreement or court determination, subject to some exceptions.
Removed
Peabody Energy Corporation 2022 Form 10-K 50 Table of Contents Shoal Creek Mine The Shoal Creek Mine is a production-stage underground longwall metallurgical coal mine located thirty-five miles west of Birmingham, Alabama, USA. The mine is within the east-central portion of the Warrior Coal Field, which is part of the Southern Appalachian coal-producing region.
Added
(8) Btu (British thermal unit) is the gross heating value of coal per pound, which includes the weight of moisture in coal on an as-sold basis. The range of variability of the moisture content in coal may affect the actual shipped Btu content.
Removed
The Drummond Corporation began producing coal at the mine in 1994. Peabody Energy acquired the mine from the Drummond Corporation in December 2018. The mine was idled in the fourth quarter of 2020 due to market conditions and resumed production in November 2021.
Added
Reference should be made to the full text of the TRS, incorporated herein by reference, made a part of Peabody’s Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the SEC on February 18, 2022.
Removed
Shoal Creek Mine extracts coal from the Mary Lee and Blue Creek coal seams at depths of 1,000 to 1,300 feet. The Company has secured mineral rights through a combination of private, federal and state mineral leases and surface rights agreements which encompass a total of 31,747 acres of mineral control and 3,490 acres of surface land control.
Added
Reference should be made to the full text of the TRSs for Wilpinjong and Centurion Mines, incorporated herein by reference and made a part of this Annual Report on Form 10-K.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

11 edited+8 added−5 removed8 unchanged
Biggest changeThe Custom Composite Index reflects publicly listed U.S. companies within the coal industry of similar size or product type. The graph assumes that the value of the investment in BTU and each index was $100 at December 31, 2017. The graph also assumes that all dividends were reinvested and that the investments were held through December 31, 2022.
Biggest change(Custom Composite Index); and (iii) the S&P Metals Mining Select Industry Index, which replaces the Custom Composite Index. As certain competitors within the Custom Composite Index have diversified from coal production, Peabody elected to use a published industry index. The graph assumes that the value of the investment in BTU and each index was $100 at December 31, 2018.
During the year ended December 31, 2021, the Company sold approximately 24.8 million shares for net cash proceeds of $269.8 million. No sales were made under this at-the-market equity offering program during the year ended December 31, 2022, leaving approximately 7.7 million shares available for sale.
During the year ended December 31, 2021, the Company sold approximately 24.8 million shares for net cash proceeds of $269.8 million. No sales were made under this at-the-market equity offering program during the years ended December 31, 2022 or 2023, leaving approximately 7.7 million shares available for sale.
Peabody’s Common Stock is listed on the New York Stock Exchange, under the symbol “BTU.” As of February 17, 2023 there were 173 holders of the Company’s Common Stock, as determined by counting its record holders and the number of participants reflected in a security position listing provided to the Company by the Depository Trust Company (DTC).
Peabody’s Common Stock is listed on the New York Stock Exchange, under the symbol “BTU.” As of February 16, 2024 there were 176 holders of the Company’s Common Stock, as determined by counting its record holders and the number of participants reflected in a security position listing provided to the Company by the Depository Trust Company (DTC).
These indices are included for comparative purposes only and do not necessarily reflect management's opinion that such indices are an appropriate measure of the relative performance of the stock involved and are not intended to forecast or be indicative of possible future performance of the common stock. Peabody Energy Corporation 2022 Form 10-K 59 Table of Contents Item 6. Reserved.
These indices are included for comparative purposes only and do not necessarily reflect management's opinion that such indices are an appropriate measure of the relative performance of the stock involved and are not intended to forecast or be indicative of possible future performance of the common stock. Item 6. Reserved. Not applicable.
Stock Performance Graph The following performance graph compares the cumulative total return on Peabody’s common stock with the cumulative total return of the following indices: (i) the S&P MidCap 400 Stock Index and (ii) Custom Composite Index (a peer group comprised of Arch Resources, Inc., Hallador Energy Co., and Warrior Met Coal, Inc.).
Peabody Energy Corporation 2023 Form 10-K 57 Table of Contents Stock Performance Graph The following performance graph compares the cumulative total return on Peabody’s common stock with the cumulative total return of the following indices: (i) the S&P MidCap 400 Stock Index; (ii) a historical peer group comprised of Arch Resources, Inc., Hallador Energy Co., and Warrior Met Coal, Inc.
Purchases of Equity Securities The following table summarizes all share purchases for the three months ended December 31, 2022: Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Dollar Value of Shares that May Yet Be Used to Repurchase Shares Under the Publicly Announced Program (In millions) October 1 through October 31, 2022 — $ — — $ 160.5 November 1 through November 30, 2022 — — — 160.5 December 1 through December 31, 2022 — — — 160.5 Total — — — (1) Includes shares withheld to cover the withholding taxes upon the vesting of equity awards, which are not a part of the Repurchase Program Repurchase Program.
Purchases of Equity Securities The following table summarizes all share purchases for the three months ended December 31, 2023: Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Dollar Value of Shares that May Yet Be Used to Repurchase Shares Under the Publicly Announced Program (In millions) October 1 through October 31, 2023 1,206,643 $ 24.95 1,206,515 $ 703.5 November 1 through November 30, 2023 1,174,073 23.35 1,174,073 676.1 December 1 through December 31, 2023 1,085,760 24.06 1,085,760 650.0 Total 3,466,476 24.13 3,466,348 (1) Includes shares withheld to cover the withholding taxes upon the vesting of equity awards, which are not a part of the Repurchase Program Repurchase Program.
Because such DTC participants are brokers and other institutions holding shares of Peabody’s Common Stock on behalf of their customers, the Company does not know the actual number of unique shareholders represented by these record holders. Dividends As more fully described within “Liquidity and Capital Resources” of Part II, Item 7.
Because such DTC participants are brokers and other institutions holding shares of Peabody’s Common Stock on behalf of their customers, the Company does not know the actual number of unique shareholders represented by these record holders.
Additionally, restrictive covenants in its credit facility also limit the Company's ability to pay cash dividends. Share Relinquishments The Company routinely allows employees to relinquish Common Stock to pay estimated taxes upon the vesting of restricted stock units and the payout of performance units that are settled in Common Stock under its equity incentive plans.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations.”) Share Relinquishments The Company routinely allows employees to relinquish Common Stock to pay estimated taxes upon the vesting of restricted stock units and the payout of performance units that are settled in Common Stock under its equity incentive plans.
Peabody Energy Corporation 2022 Form 10-K 58 Table of Contents Issuances of Equity Securities In June 2021, the Company announced an at-the-market equity offering program pursuant to which the Company could offer and sell up to 12.5 million shares of its Common Stock. The at-the-market equity offering program was further expanded to 32.5 million shares during 2021.
The value of Common Stock tendered by employees is determined based on the closing price of the Company’s Common Stock on the dates of the respective relinquishments. Issuances of Equity Securities In June 2021, the Company announced an at-the-market equity offering program pursuant to which the Company could offer and sell up to 12.5 million shares of its Common Stock.
The Repurchase Program does not have an expiration date and may be discontinued at any time. Through December 31, 2022, the Company has repurchased 41.5 million shares of its Common Stock for $1,340.3 million, which included commissions paid of $0.8 million, leaving $160.5 million available for share repurchase under the Repurchase Program.
Through December 31, 2023, the Company had repurchased 16.1 million shares of its common stock under the 2023 Repurchase Program for $350.3 million, which included $2.6 million of unsettled share repurchases and commissions paid of $0.3 million, leaving $650.0 million available for share repurchase.
Share Repurchase Program On August 1, 2017, the Company announced that its Board of Directors authorized a share repurchase program to allow repurchases of up to $500 million of the then outstanding shares of its common stock and/or preferred stock (Repurchase Program), which was eventually expanded to $1.5 billion during 2018.
On April 17, 2023, the Company announced that its Board of Directors authorized a new share repurchase program (2023 Repurchase Program) authorizing repurchases of up to $1.0 billion of its common stock. The 2023 Repurchase Program superseded and replaced the previous repurchase program that had been announced in 2017.
Removed
“Management’s Discussion and Analysis of Financial Condition and Results of Operations,” during the fourth quarter of 2020, the Company entered into a transaction support agreement with its surety bond providers which prohibits the payment of dividends through the earlier of December 31, 2025, or the maturity of the Credit Agreement (currently March 31, 2025) unless otherwise agreed to by the parties to the agreements.
Added
Share Repurchase Program On April 14, 2023, the Company amended its existing transaction support agreement with the providers of its surety bond portfolio, dated November 6, 2020, to remove the restrictions on shareholder returns, subject to a minimum liquidity threshold, and terminated the then-existing credit facility.
Removed
The value of Common Stock tendered by employees is determined based on the closing price of the Company’s Common Stock on the dates of the respective relinquishments.
Added
Under the 2023 Repurchase Program, the Company may purchase shares of common stock from time to time at the discretion of management through open market purchases, privately negotiated transactions, block trades, accelerated or other structured share repurchase programs, or other means.
Removed
Similar to the payment of dividends as described above, the same agreements with the Company’s surety bond providers prohibit share repurchases through the earlier of December 31, 2025, or the maturity of the Credit Agreement (currently March 31, 2025) unless otherwise agreed to by the parties to the agreements.
Added
The amount of any share repurchase transactions is subject to the Company’s annual Available Free Cash Flow (as defined in Part II, Item 7.
Removed
Additionally, restrictive covenants in its credit facility also limit the Company’s ability to repurchase shares. Future repurchases will be made at the Company’s discretion.
Added
“Management’s Discussion and Analysis of Financial Condition and Results of Operations.”) The manner, timing and pricing of any share repurchase transactions will be based on a variety of factors, including market conditions, applicable legal requirements and alternative opportunities that the Company may have for the use or investment of capital.
Removed
The specific timing, price and size of purchases will depend upon the share price, general market and economic conditions and other considerations, including compliance with various debt agreements in effect at the time any repurchases are made.
Added
Peabody Energy Corporation 2023 Form 10-K 56 Table of Contents Dividends During the year ended December 31, 2023, the Company declared dividends per share of $0.225. On February 8, 2024, the Company declared an additional dividend per share of $0.075 to be paid on March 13, 2024 to shareholders of record as of February 22, 2024.
Added
The declaration and payment of dividends and the amount of dividends will depend on the Company’s annual Available Free Cash Flow (as defined in Part II, Item 7.
Added
The at-the-market equity offering program was further expanded to 32.5 million shares during 2021.
Added
The graph also assumes that all dividends were reinvested and that the investments were held through December 31, 2023.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

133 edited+51 added−101 removed46 unchanged
Biggest changeDecember 31, Debt Instrument (defined below, as applicable) 2022 2021 (Dollars in millions) 6.000% Senior Secured Notes due March 2022 (2022 Notes) $ — $ 23.1 8.500% Senior Secured Notes due December 2024 (2024 Peabody Notes) — 62.6 10.000% Senior Secured Notes due December 2024 (2024 Co-Issuer Notes) — 193.9 Senior Secured Term Loan due 2024 (Co-Issuer Term Loans) — 206.0 6.375% Senior Secured Notes due March 2025 (2025 Notes) — 334.9 Senior Secured Term Loan due 2025, net of original issue discount (Senior Secured Term Loan) — 322.8 3.250% Convertible Senior Notes due March 2028 (2028 Convertible Notes) 320.0 — Finance lease obligations 23.6 29.3 Less: Debt issuance costs (9.8) (34.8) 333.8 1,137.8 Less: Current portion of long-term debt 13.2 59.6 Long-term debt $ 320.6 $ 1,078.2 As further described below, during 2021, the Company completed a significant debt restructuring to extend maturities on its existing debt and obtain covenant relief.
Biggest changeDecember 31, Debt Instrument (defined below, as applicable) 2023 2022 (Dollars in millions) 3.250% Convertible Senior Notes due March 2028 (2028 Convertible Notes) $ 320.0 $ 320.0 Finance lease obligations 22.3 23.6 Less: Debt issuance costs (8.1) (9.8) 334.2 333.8 Less: Current portion of long-term debt 13.5 13.2 Long-term debt $ 320.7 $ 320.6 During 2022, the Company utilized various methods allowable or required under its then-existing debt agreements to retire all of its senior secured long-term debt, leaving only its 2028 Convertible Notes, which are further described below, and various finance lease obligations outstanding at December 31, 2022.
The Company classifies its seaborne mines within the Seaborne Thermal Mining or Seaborne Metallurgical Mining segments based on the primary customer base and coal reserve type of each mining operation. A small portion of the coal mined by the Seaborne Thermal Mining segment is of a metallurgical grade.
The Company classifies its seaborne mines within the Seaborne Thermal or Seaborne Metallurgical segments based on the primary customer base and coal reserve type of each mining operation. A small portion of the coal mined by the Seaborne Thermal segment is of a metallurgical grade.
The principal business of the Company’s thermal operating segments in the U.S. is the mining, preparation and sale of thermal coal, sold primarily to electric utilities in the U.S. under long-term contracts, with a relatively small portion sold as international exports as conditions warrant. The Company’s Powder River Basin Mining operations consist of its mines in Wyoming.
The principal business of the Company’s thermal operating segments in the U.S. is the mining, preparation and sale of thermal coal, sold primarily to electric utilities in the U.S. under long-term contracts, with a relatively small portion sold as international exports as conditions warrant. The Company’s Powder River Basin operations consist of its mines in Wyoming.
The mines in that segment are characterized by surface mining extraction processes, coal with a lower sulfur content and Btu and higher customer transportation costs (due to longer shipping distances). The Company’s Other U.S. Thermal Mining operations reflect the aggregation of its Illinois, Indiana, New Mexico and Colorado mining operations.
The mines in that segment are characterized by surface mining extraction processes, coal with a lower sulfur content and Btu and higher customer transportation costs (due to longer shipping distances). The Company’s Other U.S. Thermal operations reflect the aggregation of its Illinois, Indiana, New Mexico and Colorado mining operations.
The Company has an ongoing asset optimization program whereby its property management group regularly reviews these reserves, resources and surface properties for opportunities to generate earnings and cash flow through the sale or exchange of non-strategic coal reserves, resources and surface lands. These surface lands include acres where Peabody has completed post-mining reclamation.
The Company has an ongoing asset optimization program whereby its property management group regularly reviews these coal reserves, coal resources and surface properties for opportunities to generate earnings and cash flow through the sale or exchange of non-strategic coal reserves, coal resources and surface lands. These surface lands include acres where Peabody has completed post-mining reclamation.
The Company has also generated cash from the sale of non-strategic assets, including coal reserves, resources and surface lands, and, from time to time, borrowings under its credit facilities and the issuance of securities.
The Company has also generated cash from the sale of non-strategic assets, including coal reserves, coal resources and surface lands, and, from time to time, borrowings under its credit facilities and the issuance of securities.
Similarly, a small portion of the coal mined by the Seaborne Metallurgical Mining segment is of a thermal grade. Additionally, the Company may market some of its metallurgical coal products as a thermal coal product from time to time depending on market conditions. The Company’s Seaborne Thermal Mining operations consist of mines in New South Wales, Australia.
Similarly, a small portion of the coal mined by the Seaborne Metallurgical segment is of a thermal grade. Additionally, the Company may market some of its metallurgical coal products as a thermal coal product from time to time depending on market conditions. The Company’s Seaborne Thermal operations consist of mines in New South Wales, Australia.
Critical Accounting Policies and Estimates The Company’s discussion and analysis of its financial condition, results of operations, liquidity and capital resources is based upon its financial statements, which have been prepared in accordance with U.S. GAAP. The Company is also required under U.S.
Critical Accounting Policies and Estimates The Company’s discussion and analysis of its financial condition, results of operations, liquidity and capital resources is based upon its consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The Company is also required under U.S.
Unrealized Losses on Foreign Currency Option Contracts. Unrealized losses primarily relate to mark-to-market activity on foreign currency option contracts. For additional information, refer to Note 6. “Derivatives and Fair Value Measurements” to the accompanying consolidated financial statements. Income Tax Benefit (Provision) .
Unrealized gains (losses) primarily relate to mark-to-market activity on foreign currency option contracts. For additional information, refer to Note 6. “Derivatives and Fair Value Measurements” to the accompanying consolidated financial statements. Income Tax (Provision) Benefit .
The seaborne pricing included in the table below is not necessarily indicative of the pricing the Company realized during the year ended December 31, 2022 due to quality differentials and a portion of its seaborne sales being executed through annual and multi-year international coal supply agreements that contain provisions requiring both parties to renegotiate pricing periodically, with spot, index and quarterly sales arrangements also utilized.
The seaborne pricing included in the table below is not necessarily indicative of the pricing the Company realized during the year ended December 31, 2023 due to quality differentials and a portion of its seaborne sales being executed through annual and multi-year international coal supply agreements that contain provisions requiring both parties to renegotiate pricing periodically, with spot, index and quarterly sales arrangements also utilized.
The mines in that segment are characterized by a mix of surface and underground mining extraction processes, coal with a higher sulfur content and Btu and lower customer transportation costs (due to shorter shipping distances). Geologically, the Company’s Powder River Basin Mining operations mine sub-bituminous coal deposits and its Other U.S.
The mines in that segment are characterized by a mix of surface and underground mining extraction processes, coal with a higher sulfur content and Btu and lower customer transportation costs (due to shorter shipping distances). Geologically, the Company’s Powder River Basin operations mine sub-bituminous coal deposits and its Other U.S. Thermal operations mine both bituminous and sub-bituminous coal deposits.
Summary Spot pricing for premium low-vol hard coking coal (Premium HCC), premium low-vol pulverized coal injection (Premium PCI) coal, Newcastle index thermal coal and API 5 index thermal coal, and prompt month pricing for PRB 8,880 Btu/Lb coal and Illinois Basin 11,500 Btu/Lb coal during the year ended December 31, 2022 is set forth in the table below.
Summary Spot pricing for premium low-vol hard coking coal (Premium HCC), premium low-vol pulverized coal injection (Premium PCI) coal, Newcastle index thermal coal and API 5 index thermal coal, and prompt month pricing for PRB 8,880 Btu/Lb coal and Illinois Basin 11,500 Btu/Lb coal during the year ended December 31, 2023 is set forth in the table below.
Accrued contingent liabilities exclude claims against third parties and are not discounted. The current portion of these accruals is included in “Accounts payables and accrued expenses” and the long-term portion is included in “Other noncurrent liabilities” in the Company’s consolidated balance sheets. In general, legal fees related to environmental remediation and litigation are charged to expense.
Accrued contingent liabilities exclude claims against third parties and are not discounted. The current portion of these accruals is included in “Accounts payables and accrued expenses” and the long-term portion is included in “Other noncurrent liabilities” in the Company’s consolidated balance sheets. In general, legal fees related to environmental remediation and litigation are charged to expense as incurred.
See the table below for a reconciliation of Free Cash Flow to its most comparable measure under U.S. GAAP.
See the table below for a reconciliation of Available Free Cash Flow to its most comparable measure under U.S. GAAP.
The assumptions used are based on the Company’s best knowledge at the time it prepares its analysis but can vary significantly due to the volatile and cyclical nature of coal prices and demand, regulatory issues, unforeseen mining conditions, commodity prices and cost of labor.
When necessary, the assumptions used are based on the Company’s best knowledge at the time it prepares its analysis but can vary significantly due to the volatile and cyclical nature of coal prices and demand, regulatory issues, unforeseen mining conditions, commodity prices and cost of labor.
In the U.S., the pricing included in the table below is also not necessarily indicative of the pricing the Company realized during the year ended December 31, 2022 since the Company generally sells coal under long-term contracts where pricing is determined based on various factors.
In the U.S., the pricing included in the table below is also not necessarily indicative of the pricing the Company realized during the year ended December 31, 2023 since the Company generally sells coal under long-term contracts where pricing is determined based on various factors.
The Company’s ability to declare dividends or repurchase shares in the future will depend on its future financial performance, which in turn depends on the successful implementation of its strategy and on financial, competitive, regulatory, technical and other factors, general economic conditions, demand for and selling prices of coal and other factors specific to its industry, many of which are beyond the Company’s control.
The Company’s ability to early retire debt, declare dividends or repurchase shares in the future will depend on its future financial performance, which in turn depends on the successful implementation of its strategy and on financial, competitive, regulatory, technical and other factors, general economic conditions, demand for and selling prices of coal and other factors specific to its industry, many of which are beyond the Company’s control.
The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. Asset Retirement Obligations.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The Company’s discussion and analysis of the year ended December 31, 2022 compared to the year ended December 31, 2021 is included herein.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The Company’s discussion and analysis of the year ended December 31, 2023 compared to the year ended December 31, 2022 is included herein.
The mines in that segment utilize both surface and underground extraction processes to mine low-sulfur, high Btu thermal coal. The Company’s Seaborne Metallurgical Mining operations consist of mines in Queensland, Australia, one in New South Wales, Australia and one in Alabama, USA.
The mines in that segment utilize both surface and underground extraction processes to mine low-sulfur, high Btu thermal coal. The Company’s Seaborne Metallurgical operations consist of mines in Queensland, Australia, one in New South Wales, Australia and one in Alabama, USA. The mines in that segment utilize both surface and underground extraction processes to mine various qualities of metallurgical coal.
For discussion and analysis of the year ended December 31, 2021 compared to the year ended December 31, 2020, please refer to Item 7 of Part II, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Peabody’s Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the SEC on February 18, 2022 and is incorporated by reference herein.
For discussion and analysis of the year ended December 31, 2022 compared to the year ended December 31, 2021, please refer to Item 7 of Part II, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Peabody’s Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 24, 2023 and is incorporated by reference herein.
GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP. Peabody Energy Corporation 2022 Form 10-K 67 Table of Contents Depreciation, Depletion and Amortization.
GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP. Peabody Energy Corporation 2023 Form 10-K 65 Table of Contents Depreciation, Depletion and Amortization.
During the years ended December 31, 2022 and 2021, the mine sold 1.6 million and 2.0 million tons of coal, respectively (on a 50% basis).
During the years ended December 31, 2023 and 2022, the mine sold 1.2 million and 1.6 million tons of coal, respectively (on a 50% basis).
The tax benefits recognized in the financial statements from such a position must be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. At December 31, 2022, the Company had net unrecognized tax benefits of $9.5 million included in recorded liabilities in the consolidated balance sheet.
The tax benefits recognized in the financial statements from such a position must be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. At December 31, 2023, the Company had net unrecognized tax benefits of $8.7 million included in recorded liabilities in the consolidated balance sheet.
Net Income Attributable to Noncontrolling Interests . The increase in net income attributable to noncontrolling interests during the year ended December 31, 2022 compared to the prior year period was primarily due to stronger financial results of Peabody’s majority-owned mines in which there is an outside non-controlling interest.
The increase in net income attributable to noncontrolling interests during the year ended December 31, 2023 compared to the prior year period was primarily due to stronger financial results of Peabody’s majority-owned Wambo operations in which there is an outside non-controlling interest.
If a range of possible loss exists and no anticipated loss within the range is more likely than any other anticipated loss, the Company records the accrual at the low end of the range, in accordance with Accounting Standards Codification 450, “Contingencies.” Peabody Energy Corporation 2022 Form 10-K 82 Table of Contents Peabody provides disclosure surrounding loss contingencies when it believes that it is at least reasonably possible that a material loss may be incurred or an exposure to loss in excess of amounts already accrued may exist.
If a range of possible loss exists and no anticipated loss within the range is more likely than any other anticipated loss, the Company records the accrual at the low end of the range, in accordance with Accounting Standards Codification 450, “Contingencies.” Peabody provides disclosure surrounding loss contingencies when it believes that it is at least reasonably possible that a material loss may be incurred or an exposure to loss in excess of amounts already accrued may exist.
The Company recognized $11.2 million in aggregate asset impairment charges during the year ended December 31, 2022 related to the sale of certain land interests and an investment in equity securities. Refer to Note 3.
The Company recognized $2.0 million in aggregate asset impairment charges during the year ended December 31, 2023 related to an investment in equity securities. Aggregate asset impairment charges of $11.2 million recognized during the prior year were related to the sale of certain land interests and an investment in equity securities. Refer to Note 3.
Asset retirement obligation expense, consisting of both accretion expense and changes in estimates for the Company’s inactive locations, for the year ended December 31, 2022 was $49.4 million and payments totaled $52.6 million. See Note 12. “Asset Retirement Obligations” to the accompanying consolidated financial statements for additional information regarding the Company’s asset retirement obligations. Impairment of Long-Lived Assets.
Asset retirement obligation expense, consisting of both accretion expense and changes in estimates for the Company’s inactive locations, for the year ended December 31, 2023 was $50.5 million and payments totaled $60.4 million. See Note 12. “Asset Retirement Obligations” to the accompanying consolidated financial statements for additional information regarding the Company’s asset retirement obligations. Impairment of Long-Lived Assets.
Bonding requirement amounts may differ significantly from the related asset retirement obligation because such requirements are calculated under the assumption that reclamation begins currently, whereas the Company’s accounting liabilities are discounted from the end of a mine’s economic life (when final reclamation work would begin) to the balance sheet date. Guarantees and Other Financial Instruments with Off-Balance Sheet Risk.
Bonding requirement amounts may differ significantly from the related asset retirement obligation because such requirements are calculated under the assumption that reclamation begins currently, whereas the Company’s accounting liabilities are discounted from the end of a mine’s economic life (when final reclamation work would begin) to the balance sheet date.
Peabody Energy Corporation 2022 Form 10-K 71 Table of Contents Any future determinations to return capital to stockholders, such as dividends or share repurchases will depend on a variety of factors, including the restrictions set forth under the Company’s debt and surety agreements, its net income or other sources of cash, liquidity position and potential alternative uses of cash, such as internal development projects or acquisitions, as well as economic conditions and expected future financial results.
Peabody Energy Corporation 2023 Form 10-K 69 Table of Contents Any future determinations to return capital to stockholders, such as dividends or share repurchases will depend on a variety of factors, including the Company’s net income or other sources of cash, liquidity position and potential alternative uses of cash, such as internal development projects or acquisitions, as well as economic conditions and expected future financial results.
Amortization associated with the Company’s asset retirement obligation assets of $26.5 million for the year ended December 31, 2022 was included in “Depreciation, depletion and amortization” in the Company’s consolidated statements of operations.
Amortization associated with the Company’s asset retirement obligation assets of $33.4 million for the year ended December 31, 2023 was included in “Depreciation, depletion and amortization” in the Company’s consolidated statements of operations.
Thermal 13.19 9.71 3.48 35.8 % (1) This is an operating/statistical measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.
Thermal 12.79 13.19 (0.40) (3.0) % (1) This is an operating/statistical measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.
Tons Sold The following table presents tons sold by operating segment: (Decrease) Increase Year Ended December 31, to Volumes 2022 2021 Tons % (Tons in millions) Seaborne Thermal Mining 15.6 17.3 (1.7) (9.8) % Seaborne Metallurgical Mining 6.6 5.5 1.1 20.0 % Powder River Basin Mining 82.6 88.4 (5.8) (6.6) % Other U.S.
Tons Sold The following table presents tons sold by operating segment: (Decrease) Increase Year Ended December 31, to Volumes 2023 2022 Tons % (Tons in millions) Seaborne Thermal 15.5 15.6 (0.1) (0.6) % Seaborne Metallurgical 6.9 6.6 0.3 4.5 % Powder River Basin 87.2 82.6 4.6 5.6 % Other U.S.
In its discussion of liquidity and capital resources, Peabody includes references to Free Cash Flow which is also a non-GAAP measure. Free Cash Flow is used by management as a measure of its financial performance and its ability to generate excess cash flow from its business operations.
In its discussion of liquidity and capital resources, the Company includes references to Available Free Cash Flow (AFCF) which is also a non-GAAP financial measure. AFCF is used by management as a measure of its ability to generate excess cash flow from its business operations. Peabody believes non-GAAP performance measures are used by investors to measure its operating performance.
The gain recorded during the year ended December 31, 2022 was driven by increases to the discount rates for actuarially determined liabilities ($190.1 million) and the favorable impacts of changes for the postretirement benefit plans related to updated claims experience ($28.6 million).
Peabody Energy Corporation 2023 Form 10-K 66 Table of Contents The gain recorded during the year ended December 31, 2022 was driven by increases to the discount rates for actuarially determined liabilities ($190.1 million) and the favorable impacts of changes for the postretirement benefit plans related to updated claims experience ($28.6 million).
In connection with such matters, the Company is required to assess the likelihood of any adverse judgments or outcomes, as well as potential ranges of probable losses. A determination of the amount of reserves required for these matters is made after considerable analysis of each individual issue.
In connection with such matters, the Company is required to assess the likelihood of any adverse judgments or outcomes, as well as potential ranges of probable losses. Peabody Energy Corporation 2023 Form 10-K 76 Table of Contents A determination of the amount of reserves required for these matters is made after considerable analysis of each individual issue.
The Company’s remaining indebtedness requires estimated contractual principal and interest payments, assuming interest rates in effect at December 31, 2022, of approximately $25 million in 2023, $16 million in 2024, $14 million in 2025, $13 million in 2026, $11 million in 2027 and $322 million thereafter.
The Company’s remaining indebtedness requires estimated contractual principal and interest payments, assuming interest rates in effect at December 31, 2023, of approximately $25 million in 2024, $16 million in 2025, $13 million in 2026, $12 million in 2027 and $325 million in 2028.
Such cash flows pertain to postretirement benefit plans, work-related injuries and illnesses, defined benefit pension plans, mine reclamation and end-of-mine closure costs and exploration obligations and are estimated to amount to approximately $235 million in 2023, $100 million in 2024, $110 million in 2025, $100 million in 2026, $100 million in 2027 and $1,685 million thereafter.
Such cash flows pertain to postretirement benefit plans, work-related injuries and illnesses, defined benefit pension plans, mine reclamation and end-of-mine closure costs and exploration obligations and are estimated to amount to approximately $105 million in 2024, $80 million in 2025, $90 million in 2026, $85 million in 2027, $100 million in 2028 and $1,275 million thereafter.
Peabody Energy Corporation 2022 Form 10-K 79 Table of Contents Asset Retirement Obligations. The Company’s asset retirement obligations primarily consist of spending estimates for surface land reclamation and support facilities at both surface and underground mines in accordance with applicable reclamation laws and regulations in the U.S. and Australia as defined by each mining permit.
The Company’s asset retirement obligations primarily consist of spending estimates for surface land reclamation and support facilities at both surface and underground mines in accordance with applicable reclamation laws and regulations in the U.S. and Australia as defined by each mining permit.
Non-GAAP Financial Measures The following discussion of Peabody’s results of operations includes references to and analysis of Adjusted EBITDA and Total Reporting Segment Costs, which are financial measures not recognized in accordance with U.S. generally accepted accounting principles (U.S. GAAP).
Peabody Energy Corporation 2023 Form 10-K 58 Table of Contents Non-GAAP Financial Measures The following discussion of Peabody’s results of operations includes references to and analysis of Adjusted EBITDA and Total Reporting Segment Costs, which are financial measures not recognized in accordance with U.S. generally accepted accounting principles (U.S. GAAP).
Peabody Energy Corporation 2022 Form 10-K 60 Table of Contents Also included in the following discussion of Peabody’s results of operations are references to Revenue per Ton, Costs per Ton and Adjusted EBITDA Margin per Ton for each reporting segment. These metrics are used by management to measure each of its reporting segments’ operating performance.
Also included in the following discussion of Peabody’s results of operations are references to Revenue per Ton, Costs per Ton and Adjusted EBITDA Margin per Ton for each reporting segment. These metrics are used by management to measure each of its reporting segments’ operating performance.
Thermal Mining operations mine both bituminous and sub-bituminous coal deposits. The Company’s Corporate and Other segment includes selling and administrative expenses, results from equity affiliates, corporate hedging activities, trading and brokerage activities, minimum charges on certain transportation-related contracts, the closure of inactive mining sites and certain commercial matters. Peabody Energy Corporation 2022 Form 10-K 61 Table of Contents Resource Management.
Peabody Energy Corporation 2023 Form 10-K 59 Table of Contents The Company’s Corporate and Other segment includes selling and administrative expenses, results from equity affiliates, corporate hedging activities, trading and brokerage activities, minimum charges on certain transportation-related contracts, the closure of inactive mining sites and certain commercial matters. Resource Management.
Peabody Energy Corporation 2022 Form 10-K 66 Table of Contents Corporate and Other Adjusted EBITDA.
Peabody Energy Corporation 2023 Form 10-K 64 Table of Contents Corporate and Other Adjusted EBITDA.
When indicators of impairment are present, the Company evaluates its long-lived assets for recoverability by comparing the estimated undiscounted cash flows in the LOM plan expected to be generated by those assets under various assumptions to their carrying amounts.
Peabody Energy Corporation 2023 Form 10-K 75 Table of Contents When indicators of impairment are present, the Company evaluates its long-lived assets for recoverability by comparing the estimated undiscounted cash flows in the LOM plan expected to be generated by those assets under various assumptions to their carrying amounts.
Year Ended December 31, 2022 2021 (Dollars in millions) Income from continuing operations, net of income taxes $ 1,317.4 $ 347.4 Depreciation, depletion and amortization 317.6 308.7 Asset retirement obligation expenses 49.4 44.7 Restructuring charges 2.9 8.3 Asset impairment 11.2 — Changes in deferred tax asset valuation allowance and reserves and amortization of basis difference related to equity affiliates (2.3) (33.8) Interest expense 140.3 183.4 Net loss (gain) on early debt extinguishment 57.9 (33.2) Interest income (18.4) (6.5) Net mark-to-market adjustment on actuarially determined liabilities (27.8) (43.4) Unrealized losses on derivative contracts related to forecasted sales 35.8 115.1 Unrealized losses on foreign currency option contracts 2.3 7.5 Take-or-pay contract-based intangible recognition (2.8) (4.3) Income tax (benefit) provision (38.8) 22.8 Adjusted EBITDA $ 1,844.7 $ 916.7 Total Reporting Segment Costs is defined as operating costs and expenses adjusted for the discrete items that management excluded in analyzing each of its segments’ operating performance, as displayed in the reconciliations below: Year Ended December 31, 2022 2021 (Dollars in millions) Operating costs and expenses $ 3,290.8 $ 2,553.1 Unrealized losses on foreign currency option contracts (2.3) (7.5) Take-or-pay contract-based intangible recognition 2.8 4.3 Net periodic benefit credit, excluding service cost (49.0) (38.3) Total Reporting Segment Costs $ 3,242.3 $ 2,511.6 The following table presents Total Reporting Segment Costs by reporting segment: Year Ended December 31, 2022 2021 (Dollars in millions) Seaborne Thermal Mining $ 698.0 $ 580.9 Seaborne Metallurgical Mining 835.2 549.5 Powder River Basin Mining 997.3 836.3 Other U.S.
Year Ended December 31, 2023 2022 (Dollars in millions) Income from continuing operations, net of income taxes $ 816.0 $ 1,317.4 Depreciation, depletion and amortization 321.4 317.6 Asset retirement obligation expenses 50.5 49.4 Restructuring charges 3.3 2.9 Asset impairment 2.0 11.2 Provision for NARM and Shoal Creek losses 40.9 — Changes in amortization of basis difference related to equity affiliates (1.6) (2.3) Interest expense 59.8 140.3 Net loss on early debt extinguishment 8.8 57.9 Interest income (76.8) (18.4) Net mark-to-market adjustment on actuarially determined liabilities (0.3) (27.8) Unrealized (gains) losses on derivative contracts related to forecasted sales (159.0) 35.8 Unrealized (gains) losses on foreign currency option contracts (7.4) 2.3 Take-or-pay contract-based intangible recognition (2.5) (2.8) Income tax provision (benefit) 308.8 (38.8) Total Adjusted EBITDA $ 1,363.9 $ 1,844.7 Total Reporting Segment Costs is defined as operating costs and expenses adjusted for the discrete items that management excluded in analyzing each of its segments’ operating performance, as displayed in the reconciliations below: Year Ended December 31, 2023 2022 (Dollars in millions) Operating costs and expenses $ 3,385.1 $ 3,290.8 Unrealized gains (losses) on foreign currency option contracts 7.4 (2.3) Take-or-pay contract-based intangible recognition 2.5 2.8 Net periodic benefit credit, excluding service cost (41.6) (49.0) Total Reporting Segment Costs $ 3,353.4 $ 3,242.3 The following table presents Total Reporting Segment Costs by reporting segment: Year Ended December 31, 2023 2022 (Dollars in millions) Seaborne Thermal $ 752.9 $ 698.0 Seaborne Metallurgical 863.8 835.2 Powder River Basin 1,044.4 997.3 Other U.S.
As of December 31, 2022, Peabody controlled approximately 2.4 billion tons of proven and probable coal reserves, 2.4 billion tons of resources and approximately 360,000 acres of surface property through ownership and lease agreements.
As of December 31, 2023, Peabody controlled approximately 2.1 billion tons of proven and probable coal reserves, 2.7 billion tons of coal resources and approximately 350,000 acres of surface property through ownership and lease agreements.
During the year ended December 31, 2022, the Company repatriated approximately $1.3 billion. If additional foreign-held cash is repatriated in the future, the Company does not expect restrictions or potential taxes will have a material effect to its near-term liquidity.
During the year ended December 31, 2023, the Company repatriated approximately $250 million through intercompany dividends. If additional foreign-held cash is repatriated in the future, the Company does not expect restrictions or potential taxes will have a material effect to its near-term liquidity.
Thermal Mining (62.2) (67.4) 5.2 7.7 % Corporate and Other (9.7) (18.8) 9.1 48.4 % Total $ (317.6) $ (308.7) $ (8.9) (2.9) % Additionally, the following table presents a summary of the Company’s weighted-average depletion rate per ton for active mines in each of its operating segments: Year Ended December 31, 2022 2021 Seaborne Thermal Mining $ 2.61 $ 2.19 Seaborne Metallurgical Mining 2.55 1.18 Powder River Basin Mining 0.32 0.25 Other U.S.
Thermal (69.0) (62.2) (6.8) (10.9) % Corporate and Other (8.4) (9.7) 1.3 13.4 % Total $ (321.4) $ (317.6) $ (3.8) (1.2) % Additionally, the following table presents a summary of the Company’s weighted-average depletion rate per ton for active mines in each of its operating segments: Year Ended December 31, 2023 2022 Seaborne Thermal $ 2.13 $ 2.61 Seaborne Metallurgical 2.16 2.55 Powder River Basin 0.31 0.32 Other U.S.
The Company’s primary uses of cash include the cash costs of coal production, capital expenditures, coal reserve lease and royalty payments, debt service costs, capital and operating lease payments, postretirement plans, take-or-pay obligations, post-mining reclamation obligations, collateral and margining requirements, and selling and administrative expenses.
The Company’s primary uses of cash include the cash costs of coal production, capital expenditures, coal reserve lease and royalty payments, debt service costs, finance and operating lease payments, postretirement plans, take-or-pay obligations, post-mining reclamation obligations, collateral and margining requirements, dividends, share repurchases and selling and administrative expenses. The Company has also used cash for early debt retirements.
The Company receives a variable deposit rate on the amount of cash collateral posted in support of letters of credit. The agreement has an initial expiration date of December 31, 2025. At December 31, 2022, letters of credit of $103.3 million were outstanding under the agreement, which were collateralized by cash of $111.0 million, which includes interest earned on deposits.
The Company receives a variable deposit rate on the amount of cash collateral posted in support of letters of credit. The agreement has an initial expiration date of December 31, 2025. At December 31, 2023, letters of credit of $167.0 million were outstanding under the agreement, which were collateralized by cash of $172.0 million.
The following table presents a summary of depreciation, depletion and amortization expense by reporting segment: (Decrease) Increase Year Ended December 31, to Income 2022 2021 $ % (Dollars in millions) Seaborne Thermal Mining $ (114.4) $ (107.7) $ (6.7) (6.2) % Seaborne Metallurgical Mining (88.8) (73.3) (15.5) (21.1) % Powder River Basin Mining (42.5) (41.5) (1.0) (2.4) % Other U.S.
The following table presents a summary of depreciation, depletion and amortization expense by reporting segment: Increase (Decrease) Year Ended December 31, to Income 2023 2022 $ % (Dollars in millions) Seaborne Thermal $ (103.7) $ (114.4) $ 10.7 9.4 % Seaborne Metallurgical (91.5) (88.8) (2.7) (3.0) % Powder River Basin (48.8) (42.5) (6.3) (14.8) % Other U.S.
Thermal Mining 1.23 1.15 The increase in the weighted-average depletion rate per ton for the Seaborne Thermal Mining segment during the year ended December 31, 2022 compared to the same period in the prior year reflects the impact of volume and mix variances across the segment.
Thermal 1.23 1.23 The decreases in the weighted-average depletion rate per ton for both the Seaborne Thermal and the Seaborne Metallurgical segments during the year ended December 31, 2023 compared to the same period in the prior year reflects the impact of volume and mix variances across the segment. Asset Impairment.
Peabody accounts for income taxes in accordance with accounting guidance which requires deferred tax assets and liabilities to be recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities.
“Asset Impairment” to the accompanying consolidated financial statements for additional information regarding impairment charges. Income Taxes. Peabody accounts for income taxes in accordance with accounting guidance which requires deferred tax assets and liabilities to be recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities.
The estimated future cash flows associated with such arrangements are approximately $100 million in 2023, $110 million in 2024, $105 million in 2025, $100 million in 2026, $100 million in 2027 and $875 million thereafter.
The estimated future cash flows associated with such arrangements are approximately $103 million in 2024, $100 million in 2025, $100 million in 2026, $100 million in 2027, $100 million in 2028 and $685 million thereafter.
Net (Loss) Gain on Early Debt Extinguishment. The net loss (gain) on early debt extinguishment was primarily related to the redemption of existing notes during the years ended December 31, 2022 and 2021, as further discussed in Note 10. “Long-term Debt” to the accompanying consolidated financial statements. Interest Income.
The net loss on early debt extinguishment recognized during the prior year was primarily related to the redemption of existing notes, as further discussed in Note 10. “Long-term Debt” to the accompanying consolidated financial statements. Interest Income.
Peabody Energy Corporation 2022 Form 10-K 77 Table of Contents Cash Flows and Free Cash Flow The following table summarizes the Company’s cash flows for the years ended December 31, 2022 and 2021, as reported in the accompanying consolidated financial statements. Free Cash Flow is a financial measure not recognized in accordance with U.S. GAAP.
Cash Flows The following table summarizes the Company’s cash flows for the years ended December 31, 2023 and 2022, as reported in the accompanying consolidated financial statements. Available Free Cash Flow is a financial measure not recognized in accordance with U.S. GAAP.
The Company’s operating lease commitments, excluding potential contingent rental amounts, will require cash payments of approximately $19 million in 2023, $7 million in 2024 and $4 million thereafter.
The Company’s operating lease commitments, excluding potential contingent rental amounts, will require cash payments of approximately $19 million in 2024, $15 million in 2025, $15 million in 2026, $13 million in 2027, $8 million in 2028 and $4 million thereafter.
In its evaluation of the need for a valuation allowance, Peabody takes into account various factors, including the expected level of future taxable income, available tax planning strategies, reversals of existing taxable temporary differences and taxable income in carryback years.
In its evaluation of the need for a valuation allowance, Peabody takes into account various factors, including taxable income in carryback years, reversals of existing taxable temporary differences, available tax planning strategies and the expected level of future taxable income. At December 31, 2023, the Company maintained valuation allowances for income taxes totaling $1,473.5 million.
The 2028 Convertible Notes will bear interest at a rate of 3.250% per year payable semi-annually in arrears on March 1 and September 1 of each year.
The 2028 Convertible Notes will mature on March 1, 2028, unless earlier converted, redeemed or repurchased in accordance with their terms. The 2028 Convertible Notes bear interest at a rate of 3.250% per year payable semi-annually in arrears on March 1 and September 1 of each year.
Peabody Energy Corporation 2022 Form 10-K 72 Table of Contents Collateralized Letter of Credit Agreement In February 2022, the Company entered into a new agreement, which provides up to $250.0 million of capacity for irrevocable standby letters of credit, expected to primarily support reclamation bonding requirements.
Collateralized Letter of Credit Agreement In February 2022, the Company entered into an agreement, which provides up to $250.0 million of capacity for irrevocable standby letters of credit, primarily to support reclamation bonding requirements.
“Pension and Savings Plans” to the accompanying consolidated financial statements for additional information regarding postretirement benefit and pension plans. Contingent liabilities. From time to time, Peabody is subject to legal and environmental matters related to its continuing and discontinued operations and certain historical, non-coal producing operations.
“Income Taxes” to the accompanying consolidated financial statements for additional information regarding valuation allowances and unrecognized tax benefits. Contingent liabilities. From time to time, Peabody is subject to legal and environmental matters related to its continuing and discontinued operations and certain historical, non-coal producing operations.
The decrease in interest expense during the year ended December 31, 2022 compared to the prior year primarily reflects debt retirements completed by the Company during 2022 and 2021 and prior year fees related to a series of refinancing transactions completed by the Company as further described in Note 10. “Long-term Debt” to the accompanying consolidated financial statements.
The decrease in interest expense during the year ended December 31, 2023 compared to the prior year primarily reflects debt retirements completed by the Company during 2022 as further described in Note 10. “Long-term Debt” to the accompanying consolidated financial statements. Net Loss on Early Debt Extinguishment.
Thermal Mining 242.4 164.2 78.2 47.6 % Corporate and Other 104.8 86.3 18.5 21.4 % Adjusted EBITDA (1) $ 1,844.7 $ 916.7 $ 928.0 101.2 % (1) This is a financial measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S.
Thermal 207.5 242.4 (34.9) (14.4) % Corporate and Other (12.2) 104.8 (117.0) (111.6) % Adjusted EBITDA (1) $ 1,363.9 $ 1,844.7 $ (480.8) (26.1) % (1) This is a financial measure not recognized in accordance with U.S. GAAP. Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S. GAAP.
The Company used the proceeds of the offering of the 2028 Convertible Notes to redeem the remaining $62.5 million of its outstanding 2024 Peabody Notes and, together with available cash, approximately $257.4 million of its outstanding 2025 Notes, and to pay related premiums, fees and expenses relating to the offering of the 2028 Convertible Notes and the redemptions.
The Company used the proceeds of the offering of the 2028 Convertible Notes and available cash to redeem $62.6 million of senior secured notes maturing in 2024 and $257.4 million of senior secured notes maturing in 2025, and to pay related premiums, fees and expenses relating to the offering and redemptions.
(2) Includes gains (losses) on certain surplus coal reserve, resource and surface land sales and property management costs and revenue. (3) Includes trading and brokerage activities, costs associated with post-mining activities, gains (losses) on certain asset disposals, minimum charges on certain transportation-related contracts, costs associated with suspended operations including the North Goonyella Mine and expenses related to other commercial activities.
(3) Includes trading and brokerage activities, costs associated with post-mining activities, gains (losses) on certain asset disposals, minimum charges on certain transportation-related contracts, costs associated with suspended operations including the Centurion Mine and expenses related to the Company’s other commercial activities.
(2) Prices expressed per short ton. Within the global coal industry, supply and demand for its products and the supplies used for mining have been impacted by the ongoing Russian-Ukrainian conflict and the COVID-19 pandemic. Furthermore, inflationary pressures and supply chain constraints have contributed to rising costs and may continue to impact future periods.
(2) Prices expressed per short ton. Within the global coal industry, supply and demand for its products and the supplies used for mining have been impacted by the ongoing geopolitical events, including the Russian-Ukrainian conflict. Furthermore, inflationary pressures and supply chain constraints contributed to rising costs during the twelve months ended December 31, 2023.
Such collateral is primarily in support of the financial instruments noted above, including in relation to the Company’s collateralized letter of credit agreement, mandatory repurchases of credit facility capacity, additional collateral in support of certain surety bonds, and amounts held directly with beneficiaries which are not supported by surety bonds.
Such collateral is primarily in support of the financial instruments noted above, including in relation to the Company’s surety bond portfolio, its collateralized letter of credit agreement, mandatory repurchases of credit facility capacity and amounts held directly with beneficiaries which are not supported by surety bonds. At December 31, 2023, the Company had total asset retirement obligations of $702.8 million.
Thermal Mining 18.4 16.9 1.5 8.9 % Total tons sold from operating segments 123.2 128.1 (4.9) (3.8) % Corporate and Other 0.5 2.0 (1.5) (75.0) % Total tons sold 123.7 130.1 (6.4) (4.9) % Peabody Energy Corporation 2022 Form 10-K 64 Table of Contents Supplemental Financial Data The following table presents supplemental financial data by operating segment: Year Ended December 31, Increase (Decrease) 2022 2021 $ % Revenue per Ton - Mining Operations (1) Seaborne Thermal $ 86.07 $ 54.09 $ 31.98 59.1 % Seaborne Metallurgical 243.78 131.83 111.95 84.9 % Powder River Basin 12.89 10.99 1.90 17.3 % Other U.S.
Thermal 16.2 18.4 (2.2) (12.0) % Total tons sold from operating segments 125.8 123.2 2.6 2.1 % Corporate and Other 0.4 0.5 (0.1) (20.0) % Total tons sold 126.2 123.7 2.5 2.0 % Peabody Energy Corporation 2023 Form 10-K 62 Table of Contents Supplemental Financial Data The following table presents supplemental financial data by operating segment: Year Ended December 31, (Decrease) Increase 2023 2022 $ % Revenue per Ton - Mining Operations (1) Seaborne Thermal $ 85.94 $ 86.07 $ (0.13) (0.2) % Seaborne Metallurgical 188.66 243.78 (55.12) (22.6) % Powder River Basin 13.74 12.89 0.85 6.6 % Other U.S.
“Other Events.” Income From Continuing Operations, Net of Income Taxes The following table presents income from continuing operations, net of income taxes: Increase (Decrease) to Income Year Ended December 31, 2022 2021 $ % (Dollars in millions) Adjusted EBITDA (1) $ 1,844.7 $ 916.7 $ 928.0 101.2 % Depreciation, depletion and amortization (317.6) (308.7) (8.9) (2.9) % Asset retirement obligation expenses (49.4) (44.7) (4.7) (10.5) % Restructuring charges (2.9) (8.3) 5.4 65.1 % Asset impairment (11.2) — (11.2) n.m.
Income From Continuing Operations, Net of Income Taxes The following table presents income from continuing operations, net of income taxes: (Decrease) Increase to Income Year Ended December 31, 2023 2022 $ % (Dollars in millions) Adjusted EBITDA (1) $ 1,363.9 $ 1,844.7 $ (480.8) (26.1) % Depreciation, depletion and amortization (321.4) (317.6) (3.8) (1.2) % Asset retirement obligation expenses (50.5) (49.4) (1.1) (2.2) % Restructuring charges (3.3) (2.9) (0.4) (13.8) % Asset impairment (2.0) (11.2) 9.2 82.1 % Provision for NARM and Shoal Creek losses (40.9) — (40.9) n.m.
In February 2023, the Company LC Agreement was further amended to reduce its capacity by an additional $65.0 million, accelerate its expiration date to December 31, 2023 from December 31, 2024, and eliminate the prepayment premium due upon any reduction of commitments thereunder prior to July 29, 2023.
LC Facility The now-terminated LC Facility had an original capacity of $324.0 million and was subsequently amended at various dates to reduce its capacity and effect certain other changes, including in February 2023 to reduce capacity by $65.0 million, accelerate the expiration date to December 31, 2023 from December 31, 2024, and eliminate the prepayment premium due upon any reduction of commitments thereunder prior to July 29, 2023.
The following table presents a summary of the components of Corporate and Other Adjusted EBITDA: Increase (Decrease) Year Ended December 31, to Income 2022 2021 $ % (Dollars in millions) Middlemount (1) $ 132.8 $ 48.2 $ 84.6 175.5 % Resource management activities (2) 29.3 6.9 22.4 324.6 % Selling and administrative expenses (88.8) (84.9) (3.9) (4.6) % Other items, net (3) 31.5 116.1 (84.6) (72.9) % Corporate and Other Adjusted EBITDA $ 104.8 $ 86.3 $ 18.5 21.4 % (1) Middlemount’s results are before the impact of related changes in deferred tax asset valuation allowance and reserves and amortization of basis difference.
The following table presents a summary of the components of Corporate and Other Adjusted EBITDA: (Decrease) Increase Year Ended December 31, to Income 2023 2022 $ % (Dollars in millions) Middlemount (1) $ 13.2 $ 132.8 $ (119.6) (90.1) % Resource management activities (2) 21.0 29.3 (8.3) (28.3) % Selling and administrative expenses (90.7) (88.8) (1.9) (2.1) % Other items, net (3) 44.3 31.5 12.8 40.6 % Corporate and Other Adjusted EBITDA $ (12.2) $ 104.8 $ (117.0) (111.6) % (1) Middlemount’s results are before the impact of related changes in amortization of basis difference.
Capital Expenditures For 2023, the Company is targeting total capital expenditures of approximately $325 million. Approximately $200 million of such amount is appropriated to major projects and growth capital expenditures, including approximately $120 million for the initial redevelopment of the Company’s North Goonyella mine.
Capital Expenditures For 2024, the Company is targeting total capital expenditures of approximately $375 million. Approximately $235 million of such amount is appropriated to major projects and growth capital expenditures, including approximately $150 million for the redevelopment of the Company’s Centurion Mine.
The Company’s available liquidity increased from $995.9 million as of December 31, 2021 to $1,317.8 million as of December 31, 2022.
The Company’s available liquidity decreased from $1,317.8 million as of December 31, 2022 to $1,059.7 million as of December 31, 2023.
Sales volumes increased by 20% from the prior year. Powder River Basin Mining. Segment revenue increased during the year ended December 31, 2022 compared to the prior year due to favorable realized prices ($168.5 million), offset by unfavorable volumes ($74.2 million) resulting from rail performance issues. Peabody Energy Corporation 2022 Form 10-K 65 Table of Contents Other U.S. Thermal Mining.
Segment revenue increased during the year ended December 31, 2023 compared to the prior year due to favorable realized prices ($74.1 million) and favorable volumes ($58.5 million) resulting from improved rail performance. Peabody Energy Corporation 2023 Form 10-K 63 Table of Contents Other U.S. Thermal.
Adjusted EBITDA The following table presents Adjusted EBITDA for each of the Company’s reporting segments: Increase (Decrease) to Year Ended December 31, Adjusted EBITDA 2022 2021 $ % (Dollars in millions) Seaborne Thermal Mining $ 647.6 $ 353.1 $ 294.5 83.4 % Seaborne Metallurgical Mining 781.7 178.2 603.5 338.7 % Powder River Basin Mining 68.2 134.9 (66.7) (49.4) % Other U.S.
Adjusted EBITDA The following table presents Adjusted EBITDA for each of the Company’s reporting segments: (Decrease) Increase to Year Ended December 31, Adjusted EBITDA 2023 2022 $ % (Dollars in millions) Seaborne Thermal $ 576.8 $ 647.6 $ (70.8) (10.9) % Seaborne Metallurgical 438.1 781.7 (343.6) (44.0) % Powder River Basin 153.7 68.2 85.5 125.4 % Other U.S.
These increases were offset by mark-to-market losses on pension and postretirement benefit plan assets ($43.1 million). Unrealized Losses on Derivative Contracts Related to Forecasted Sales. Unrealized losses primarily relate to mark-to-market activity on derivative contracts related to forecasted coal sales. For additional information, refer to Note 6. “Derivatives and Fair Value Measurements” to the accompanying consolidated financial statements.
Unrealized Gains (Losses) on Derivative Contracts Related to Forecasted Sales. Unrealized gains (losses) primarily relate to mark-to-market activity on derivative contracts related to forecasted coal sales. For additional information, refer to Note 6. “Derivatives and Fair Value Measurements” to the accompanying consolidated financial statements. Unrealized Gains (Losses) on Foreign Currency Option Contracts.
The increase in interest income during the year ended December 31, 2022 compared to the prior year was primarily due to higher cash balances and interest rates in the current year. Peabody Energy Corporation 2022 Form 10-K 68 Table of Contents Net Mark-to-Market Adjustment on Actuarially Determined Liabilities.
The increase in interest income during the year ended December 31, 2023 compared to the prior year was primarily due to higher cash balances, including restricted cash balances on which the Company earns interest, and higher interest rates in the current year. Net Mark-to-Market Adjustment on Actuarially Determined Liabilities.
The Company does not expect any material losses to result from these guarantees or off-balance-sheet instruments in excess of liabilities provided for in its consolidated balance sheets.
The Company periodically evaluates the instruments for on-balance-sheet treatment based on the amount of exposure under the instrument and the likelihood of required performance. The Company does not expect any material losses to result from these guarantees or off-balance-sheet instruments in excess of liabilities provided for in the accompanying consolidated balance sheets.
Changes in deferred tax asset valuation allowance and reserves and amortization of basis difference related to equity affiliates 2.3 33.8 (31.5) (93.2) % Interest expense (140.3) (183.4) 43.1 23.5 % Net (loss) gain on early debt extinguishment (57.9) 33.2 (91.1) (274.4) % Interest income 18.4 6.5 11.9 183.1 % Net mark-to-market adjustment on actuarially determined liabilities 27.8 43.4 (15.6) (35.9) % Unrealized losses on derivative contracts related to forecasted sales (35.8) (115.1) 79.3 68.9 % Unrealized losses on foreign currency option contracts (2.3) (7.5) 5.2 69.3 % Take-or-pay contract-based intangible recognition 2.8 4.3 (1.5) (34.9) % Income tax benefit (provision) 38.8 (22.8) 61.6 270.2 % Income from continuing operations, net of income taxes $ 1,317.4 $ 347.4 $ 970.0 279.2 % (1) This is a financial measure not recognized in accordance with U.S.
Changes in amortization of basis difference related to equity affiliates 1.6 2.3 (0.7) (30.4) % Interest expense (59.8) (140.3) 80.5 57.4 % Net loss on early debt extinguishment (8.8) (57.9) 49.1 84.8 % Interest income 76.8 18.4 58.4 317.4 % Net mark-to-market adjustment on actuarially determined liabilities 0.3 27.8 (27.5) (98.9) % Unrealized gains (losses) on derivative contracts related to forecasted sales 159.0 (35.8) 194.8 544.1 % Unrealized gains (losses) on foreign currency option contracts 7.4 (2.3) 9.7 421.7 % Take-or-pay contract-based intangible recognition 2.5 2.8 (0.3) (10.7) % Income tax (provision) benefit (308.8) 38.8 (347.6) (895.9) % Income from continuing operations, net of income taxes $ 816.0 $ 1,317.4 $ (501.4) (38.1) % (1) This is a financial measure not recognized in accordance with U.S.
Diluted EPS The following table presents diluted EPS: Increase (Decrease) to Year Ended December 31, EPS 2022 2021 $ % Diluted EPS attributable to common stockholders: Income from continuing operations $ 8.29 $ 3.00 $ 5.29 176.3 % Income from discontinued operations 0.02 0.22 (0.20) (90.9) % Net income attributable to common stockholders $ 8.31 $ 3.22 $ 5.09 158.1 % Peabody Energy Corporation 2022 Form 10-K 69 Table of Contents Diluted EPS is commensurate with the changes in results from continuing operations and discontinued operations during that period.
Diluted EPS The following table presents diluted EPS: Decrease to Year Ended December 31, EPS 2023 2022 $ % Diluted EPS attributable to common stockholders: Income from continuing operations $ 5.00 $ 8.29 $ (3.29) (39.7) % Income from discontinued operations — 0.02 (0.02) (100.0) % Net income attributable to common stockholders $ 5.00 $ 8.31 $ (3.31) (39.8) % Diluted EPS is commensurate with the changes in results from continuing operations and discontinued operations during that period.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

18 edited+4 added−20 removed9 unchanged
Biggest changePeabody is estimating full year 2023 metallurgical coal sales from its Seaborne Metallurgical Mining segment of 7.0 million to 8.0 million tons. Sales commitments in the metallurgical coal market are typically not long-term in nature, and the Company is therefore subject to fluctuations in market pricing.
Biggest changeSales commitments in the metallurgical coal market are typically not long-term in nature, and the Company is therefore subject to fluctuations in market pricing. The Company’s sensitivity to market pricing in thermal coal markets is dependent on the duration of contracts. As of December 31, 2023, the Company had no coal derivative contracts related to its forecasted sales.
Assuming the Company had no foreign currency hedging instruments in place, its exposure in operating costs and expenses due to a $0.10 change in the Australian dollar/U.S. dollar exchange rate is approximately $190 to $200 million for the next twelve months.
Assuming the Company had no foreign currency hedging instruments in place, its exposure in operating costs and expenses due to a $0.10 change in the Australian dollar/U.S. dollar exchange rate is approximately $185 to $195 million for the next twelve months.
This includes approximately 92 million tons of PRB coal and 19 million tons of other U.S. thermal coal. The Company has the flexibility to increase volumes should demand warrant.
This includes approximately 85 million tons of PRB coal and 15 million tons of other U.S. thermal coal. The Company has the flexibility to increase volumes should demand warrant.
Credit and Nonperformance Risk The fair values of Peabody’s derivative instruments utilized for corporate hedging and coal trading activities reflect adjustments for credit risk, as necessary. The Company’s exposure is substantially with electric utilities, energy marketers, steel producers and nonfinancial trading houses.
Peabody Energy Corporation 2023 Form 10-K 77 Table of Contents Credit and Nonperformance Risk The fair values of Peabody’s derivative instruments utilized for corporate hedging and coal trading activities reflect adjustments for credit risk, as necessary. The Company’s exposure is substantially with electric utilities, energy marketers, steel producers and nonfinancial trading houses.
Sales under such agreements comprised approximately 85%, 84% and 89% of its worldwide sales (by volume) for the years ended December 31, 2022, 2021 and 2020, respectively. As of December 31, 2022, the Company had approximately 111 million tons of U.S. thermal coal priced and committed for 2023.
Sales under such agreements comprised approximately 92%, 85% and 84% of its worldwide sales from its mining operations (by volume) for the years ended December 31, 2023, 2022 and 2021, respectively. As of December 31, 2023, the Company had approximately 100 million tons of U.S. thermal coal priced and committed for 2024.
Due to a lack of quoted market prices and the long-term, illiquid nature of the positions, the Company has not quantified market price risk related to its non-trading, long-term coal supply agreement portfolio. Coal Trading Activities and Related Commodity Price Risk Coal Price Risk Monitored Using VaR.
Due to a lack of quoted market prices and the long-term, illiquid nature of the positions, the Company has not quantified market price risk related to its non-trading, long-term coal supply agreement portfolio. Coal Trading Activities and Related Commodity Price Risk Peabody engages in direct and brokered trading of physical coal and freight-related commodities in over-the-counter markets.
A $10 per barrel change in the price of crude oil (the primary component of a refined diesel fuel product) would increase or decrease its annual diesel fuel costs by approximately $26 million based on its expected usage.
A $10 per barrel change in the price of crude oil (the primary component of a refined diesel fuel product) would increase or decrease its annual diesel fuel costs by approximately $22 million based on its expected usage. As of December 31, 2023, the Company did not have any diesel fuel derivative instruments in place.
Peabody also continually monitors counterparty and contract nonperformance risk, if present, on a case-by-case basis. Peabody Energy Corporation 2022 Form 10-K 84 Table of Contents Foreign Currency Risk The Company has historically utilized currency forwards and options to hedge currency risk associated with anticipated Australian dollar expenditures. The accounting for these derivatives is discussed in Note 6.
Peabody also continually monitors counterparty and contract nonperformance risk, if present, on a case-by-case basis. Foreign Currency Risk The Company has historically utilized currency forwards and options to hedge currency risk associated with anticipated Australian dollar operating expenditures. The accounting for these derivatives is discussed in Note 6. “Derivatives and Fair Value Measurements” to the accompanying consolidated financial statements.
Based upon the Australian dollar/U.S. dollar exchange rate at December 31, 2022, the currency option contracts outstanding at that date would limit the Company’s net exposure to a $0.10 unfavorable change in the exchange rate to approximately $167 million for the next twelve months.
Based upon the Australian dollar/U.S. dollar exchange rate at December 31, 2023, the currency option contracts outstanding at that date would limit the Company’s exposure to approximately $116 million with respect to a $0.10 increase in the exchange rate, while the Company would benefit by approximately $179 million with respect to a $0.10 decrease in the exchange rate for the next twelve months.
Peabody is estimating 2023 thermal coal sales volumes from its Seaborne Thermal Mining segment of 14.5 million to 15.5 million tons comprised of thermal export volume of 9.0 million to 10.0 million tons and domestic volume of 5.5 million tons.
Peabody is estimating 2024 thermal coal sales volumes from its Seaborne Thermal segment of 15 million to 16 million tons comprised of thermal export volume of 9 million to 11 million tons and domestic volume of 5.8 million tons. Peabody is estimating full year 2024 metallurgical coal sales from its Seaborne Metallurgical segment of 7.5 million to 8.5 million tons.
Peabody engages in direct and brokered trading of physical coal and freight-related commodities in OTC markets. These activities give rise to commodity price risk, which represents the potential loss that can be caused by an adverse change in the market value of a particular commitment.
These activities give rise to commodity price risk, which represents the potential loss that can be caused by an adverse change in the market value of a particular commitment. Peabody actively measures, monitors, manages and hedges market price risk due to current and anticipated trading activities to remain within risk limits prescribed by management.
While the support activities (such as the forward sale of coal to be produced and/or purchased) may ultimately involve instruments sensitive to market price risk, the sourcing of coal in these arrangements does not involve market risk sensitive instruments and does not encompass the commodity price risks that the Company monitors through VaR analysis, as discussed above. Future Realization.
While the support activities (such as the forward sale of coal to be produced and/or purchased) may ultimately involve instruments sensitive to market price risk, the sourcing of coal in these arrangements does not involve market risk sensitive instruments. Peabody also monitors other types of risk associated with its coal trading activities, including credit, market liquidity and counterparty nonperformance.
A one percentage point increase in interest rates would result in a decrease of approximately $23 million in the estimated fair value of these borrowings. Peabody Energy Corporation 2022 Form 10-K 85 Table of Contents Item 8. Financial Statements and Supplementary Data. See Part IV, Item 15.
A one percentage point increase in interest rates would result in a decrease of approximately $52 million in the estimated fair value of these borrowings. Item 8. Financial Statements and Supplementary Data. See Part IV, Item 15. “Exhibits and Financial Statement Schedules” of this report for the information required by this Item 8, which information is incorporated by reference herein.
VaR analysis is not used to evaluate the Company’s non-trading diesel fuel or foreign currency hedging portfolios, as applicable, or coal trading activities it employs in support of coal production (as discussed below). The Company attempts to manage market price risks through diversification, controlling position sizes and executing hedging strategies.
The potential for changes in the market value of the Company’s coal and freight-related trading, crude oil, diesel fuel and foreign currency contract portfolios, as applicable, and exposure to interest rate changes is referred to as “market risk.” The Company attempts to manage market price risks through diversification, controlling position sizes and executing hedging strategies.
“Derivatives and Fair Value Measurements” to the accompanying consolidated financial statements. As of December 31, 2022, the Company had currency options outstanding with an aggregate notional amount of $745.0 million Australian dollars to hedge currency risk associated with anticipated Australian dollar expenditures during the first nine months of 2023.
As of December 31, 2023, the Company held average rate options with an aggregate notional amount of $456.0 million Australian dollars to hedge currency risk associated with anticipated Australian dollar operating expenditures over the six-month period ending June 30, 2024.
Interest Rate Risk Peabody’s objectives in managing exposure to interest rate changes are to limit the impact of interest rate changes on earnings and cash flows and to lower overall borrowing costs. As of December 31, 2022, Peabody had approximately $320.0 million of fixed-rate borrowings and no variable-rate borrowings outstanding and had no interest rate swaps in place.
The Company partially manages the price risk of diesel fuel through the use of cost pass-through contracts with certain customers. Interest Rate Risk Peabody’s objectives in managing exposure to interest rate changes are to limit the impact of interest rate changes on earnings and cash flows and to lower overall borrowing costs.
“Exhibits and Financial Statement Schedules” of this report for the information required by this Item 8, which information is incorporated by reference herein. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.
Subsequent to December 31, 2022, the Company entered into additional average rate options with an aggregate notional amount of $135.0 million Australian dollars related to the second and third quarters of 2023 and purchased collars with an aggregate notional amount of $150.0 million Australian dollars related to the second half of 2023.
As of December 31, 2023, the Company also held purchased collars with an aggregate notional amount of $483.0 million Australian dollars related to anticipated Australian dollar operating expenditures during the nine-month period ending September 30, 2024.
Removed
The potential for changes in the market value of the Company’s coal and freight-related trading, crude oil, diesel fuel and foreign currency contract portfolios, as applicable, is referred to as “market risk.” Market risk related to its coal trading and freight-related contract portfolio, which includes bilaterally-settled and over-the-counter (OTC) exchange-settled trading, in addition to, from time to time, the brokered trading of coal, is evaluated using a value at risk (VaR) analysis.
Added
Although Peabody believes its Australian dollar monetary asset position acts as a hedge to lessen the impact on its results from operations, the Company may continue to use options and collars to hedge its cash flow exposure to currency risk associated with anticipated Australian dollar operating expenditures.
Removed
Peabody actively measures, monitors, manages and hedges market price risk due to current and anticipated trading activities to remain within risk limits prescribed by management. For example, it has policies in place that limit the amount of market price risk, as measured by VaR, that the Company may assume at any point in time from its trading and brokerage activities.
Added
Historically, such financial contracts have included futures, forwards and options. Peabody Energy Corporation 2023 Form 10-K 78 Table of Contents Diesel Fuel Price Risk The Company expects to consume 90 to 100 million gallons of diesel fuel during the next twelve months.
Removed
Peabody generally accounts for its coal trading activities using the fair value method, which requires it to reflect contracts with third parties that meet the definition of a derivative at market value in its consolidated financial statements, with the exception of contracts for which it has elected to apply the normal purchases and normal sales exception.
Added
Peabody is primarily exposed to interest rate risk as a result of its interest-earning cash balances and its long-term debt. Peabody’s interest-earning cash and restricted cash balances are primarily held in deposit accounts and investments with maturities of three months or less. Therefore, these balances are subject to interest rate fluctuations and could produce less income if interest rates fall.
Removed
Peabody’s trading portfolio included futures, forwards and options as of December 31, 2022. The use of VaR allows the Company to quantify in dollars, on a daily basis, a measure of price risk inherent in its trading portfolio.
Added
Based upon its interest-earning cash and restricted cash balances at December 31, 2023, a one percentage point decrease in interest rates would result in a decrease of approximately $16 million to interest income. As of December 31, 2023, Peabody had approximately $320 million of fixed-rate borrowings, no variable-rate borrowings outstanding and no interest rate swaps in place.
Removed
VaR represents the expected loss in portfolio value due to adverse market price movements over a defined time horizon (liquidation period) within a specified confidence level. Peabody’s VaR model is based on a variance/co-variance approach, which captures its potential loss exposure related to future, forward, swap and option positions.
Removed
Peabody’s VaR model assumes a 15-day holding period at the time of VaR measurement and produces an output corresponding with a 95% one-tailed confidence interval, which means that there is a one in 20 statistical chance that its portfolio could lose more than the VaR estimates during the assumed liquidation period.
Removed
Peabody’s volatility calculation incorporates an exponentially weighted moving average algorithm based on price movements during the previous 60 market days, which makes its volatility more representative of recent market conditions while still reflecting an awareness of historical price movements.
Removed
VaR does not estimate the maximum potential loss expected in the 5% of the time that changes in the portfolio value during the assumed liquidation period is expected to exceed measured VaR. The Company uses stress testing and scenario analysis to help provide visibility in such cases, as discussed further below.
Removed
Peabody Energy Corporation 2022 Form 10-K 83 Table of Contents VaR analysis allows the Company to aggregate market price risk across products in the portfolio, compare market price risk on a consistent basis and identify the drivers of risk and changes thereto over time. Peabody uses historical data to estimate price volatility as an input to VaR.
Removed
Given its reliance on historical data, the Company believes VaR is reasonably effective in characterizing market price risk exposures in markets in which there are not sudden fundamental changes or shifts in market conditions. Nonetheless, an inherent limitation of VaR is that past changes in market price risk factors may not produce accurate predictions of future market price risk.
Removed
Due to that limitation, combined with the subjectivity in the choice of the liquidation period and reliance on historical data to calibrate its models, the Company performs stress and scenario analyses as needed to estimate the impacts of market price changes on the value of the portfolio. Additionally, back-testing is regularly performed to monitor the effectiveness of its VaR measure.
Removed
The results of these analyses are used to supplement the VaR methodology and identify additional market price-related risks. During the year ended December 31, 2022, the actual low, high and average VaR associated with the Company’s trading and brokerage function was $0.6 million, $23.0 million and $5.4 million, respectively. Other Risk Exposures.
Removed
As of December 31, 2022, the total estimated future realization of the value of the Company’s trading portfolio is expected to occur during 2023. Peabody also monitors other types of risk associated with its coal trading activities, including credit, market liquidity and counterparty nonperformance.
Removed
The additional average rate options have a strike price of $0.75. The purchased collars have a floor and ceiling of $0.63 and $0.75, respectively, whereby the Company would incur a loss on the instruments for rates below the floor and gain for rates above the ceiling.
Removed
The Company anticipates it will continue to use options and collars to hedge Australian dollar currency risk.
Removed
As of December 31, 2022, the Company held coal derivative contracts related to a portion of its forecasted sales with an aggregate notional volume of 0.6 million tonnes. Such financial contracts may include futures, forwards and options.
Removed
The notional volume is related predominantly to financial derivatives entered to support the profitability of the Wambo Underground Mine as part of a strategy to extend the mine’s life. All such tonnes will settle in 2023.
Removed
The Newcastle thermal coal index was $398.50 per tonne on December 31, 2022, and the Company had posted $198 million of variation margin for the related derivative contracts at such date.
Removed
A change in the Newcastle forward curve of $100 per tonne would increase or decrease the Company’s variation margin requirement by approximately $55 million and result in comparable unrealized gains or losses. Diesel Fuel Price Risk Previously, the Company managed price risk of the diesel fuel used in its mining activities through the use of derivatives, primarily swaps.
Removed
As of December 31, 2022, the Company did not have any diesel fuel derivative instruments in place. The Company also manages the price risk of diesel fuel through the use of cost pass-through contracts with certain customers. The Company expects to consume 100 to 110 million gallons of diesel fuel during the next twelve months.

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