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What changed in NACCO INDUSTRIES INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of NACCO INDUSTRIES INC's 2024 and 2025 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 2025 report.

+510 added−596 removedSource: 10-K (2026-03-04) vs 10-K (2025-03-05)

Top changes in NACCO INDUSTRIES INC's 2025 10-K

510 paragraphs added · 596 removed · 339 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

126 edited+81 added−136 removed29 unchanged
Biggest changeFor as long as we remain a smaller reporting company, we may take advantage of certain exemptions from the SEC’s reporting requirements that are otherwise applicable to public companies that are not smaller reporting companies. 8 Table of Contents Government Regulation Our operations are subject to various federal, state and local laws and regulations on matters such as employee health and safety, and certain environmental laws and regulations relating to, among other matters, the reclamation and restoration of coal mining properties, air pollution, water pollution, the disposal of wastes and effects on groundwater.
Biggest changeFor as long as we remain a smaller reporting company, we may take advantage of certain exemptions from the SEC’s reporting requirements that are otherwise applicable to public companies that are not smaller reporting companies.
These SMCRA permit provisions include requirements for coal prospecting, mine plan development, topsoil removal, storage and replacement, selective handling of overburden materials, mine pit backfilling and grading, protection of the hydrologic balance, surface drainage control, mine drainage and mine discharge control and treatment, and revegetation. Although mining permits have stated expiration dates, SMCRA provides for a right of successive renewal.
These SMCRA permit provisions include requirements for coal prospecting, mine plan development, topsoil removal, storage and replacement, selective handling of overburden materials, mine pit backfilling and grading, protection of the hydrologic balance, surface drainage control, mine drainage, mine discharge control and treatment and revegetation. Although mining permits have stated expiration dates, SMCRA provides for a right of successive renewal.
In 2011, the EPA finalized the Cross-State Air Pollution Rule (CSAPR) to address interstate transport of pollutants. While the CSAPR affects states in the eastern half of the U.S. and Texas, it does not affect EGUs in North Dakota. This rule imposes additional emission restrictions on coal-fired power plants to attain ozone and fine particulate NAAQS.
Cross-State Air Pollution Rule (CSAPR) In 2011, the EPA finalized the CSAPR to address interstate transport of pollutants. While the CSAPR affects states in the eastern half of the U.S. and Texas, it does not affect EGUs in North Dakota. This rule imposes additional emission restrictions on coal-fired power plants to attain ozone and fine particulate NAAQS.
Comprehensive Environmental Response, Compensation and Liability Act CERCLA and similar state laws create liabilities for the investigation and remediation of releases of hazardous substances into the environment and for damages to natural resources. We must also comply with reporting requirements under the Emergency Planning and Community Right-to-Know Act and the Toxic Substances Control Act.
Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) CERCLA and similar state laws create liabilities for the investigation and remediation of releases of hazardous substances into the environment and for damages to natural resources. We must also comply with reporting requirements under the Emergency Planning and Community Right-to-Know Act and the Toxic Substances Control Act.
Environmental Laws Our coal mining operations are subject to various federal environmental laws, as amended, including: • the Surface Mining Control and Reclamation Act of 1977 (SMCRA); • the Clean Air Act, including amendments to that act in 1990 (CAA); • the Clean Water Act of 1972 (CWA); • the Resource Conservation and Recovery Act (RCRA); • the National Environmental Policy Act of 1970 (NEPA); and • the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).
Environmental Laws Our operations are subject to various federal environmental laws, as amended, including: • the Surface Mining Control and Reclamation Act of 1977 (SMCRA); • the Clean Air Act, including amendments to that act in 1990 (CAA); • the Clean Water Act of 1972 (CWA); • the Resource Conservation and Recovery Act (RCRA); • the National Environmental Policy Act of 1970 (NEPA); and • the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).
In addition, if hydraulic fracturing is further regulated at the federal or state level, fracturing activities could become subject to additional permitting and financial assurance requirements, more stringent construction specifications, increased monitoring, reporting and recordkeeping obligations, plugging and abandonment requirements and also to attendant permitting delays and potential increases in costs.
If hydraulic fracturing is further regulated at the federal or state level, fracturing activities could become subject to additional permitting and financial assurance requirements, more stringent construction specifications, increased monitoring, reporting and recordkeeping obligations, plugging and abandonment requirements and also to attendant permitting delays and potential increases in costs.
In the Minerals Management segment, the oil and gas industry is intensely competitive; we primarily compete with companies and investors for the acquisition of oil and gas properties, some of which have greater resources and may be able to pay more for productive oil and natural gas properties or to define, evaluate, bid for and purchase a greater number of properties than our financial resources permit.
In the Minerals and Royalties segment, the oil and gas industry is intensely competitive; we primarily compete with companies and investors for the acquisition of oil and gas properties, some of which have greater resources and may be able to pay more for productive oil and natural gas properties or to define, evaluate, bid for and purchase a greater number of properties than our financial resources permit.
The Minerals Management segment generates income primarily from royalty-based lease payments from oil, gas and to a lesser extent, coal producers. The pricing of oil, gas and coal sales is primarily determined by supply and demand in the marketplace and can fluctuate considerably.
The Minerals and Royalties segment generates income primarily from royalty-based lease payments from oil, gas and to a lesser extent, coal producers. The pricing of oil, gas and coal sales is primarily determined by supply and demand in the marketplace and can fluctuate considerably.
Additionally, many of the Minerals Management segment's competitors are, or are affiliated with, operators that engage in the exploration and production of their oil and gas properties, which allows them to acquire larger assets that include operated properties.
Additionally, many of the Minerals and Royalties segment's competitors are, or are affiliated with, operators that engage in the exploration and production of their oil and gas properties, which allows them to acquire larger assets that include operated properties.
The Florida construction industry can be affected by the cyclicality of the economy, seasonal weather conditions, significant weather events, and pandemics, all of which can result in variations in demand for aggregates. In the Minerals Management segment, oil and natural gas wells have high initial production rates and follow a natural decline before settling into relatively stable, long-term production.
The Florida construction industry can be affected by the cyclicality of the economy, seasonal weather conditions and significant weather events, all of which can result in variations in demand for aggregates. In the Minerals and Royalties segment, oil and natural gas wells have high initial production rates and follow a natural decline before settling into relatively stable, long-term production.
In 2004, Bellaire was notified by the Pennsylvania Department of Environmental Protection that it was required to establish a mine water treatment trust to serve as a long-term funding mechanism related to this obligation. See Note 7 and Note 9 to the Consolidated Financial Statements in this Form 10-K for further information on Bellaire.
In 2004, Bellaire was notified by the Pennsylvania Department of Environmental 11 Table of Contents Protection that it was required to establish a mine water treatment trust to serve as a long-term funding mechanism related to this obligation. See Note 7 and Note 9 to the Consolidated Financial Statements in this Form 10-K for further information on Bellaire.
In addition, demand for coal-fired power generation can increase due to unusually hot or cold weather as consumers use more air conditioning or heating, respectively. Conversely, mild weather can result in weaker demand for coal-fired power generation. The NAMining segment extracts a significant amount of the annual limestone produced in Florida.
In addition, demand for coal-fired power generation can increase due to unusually hot or cold weather as consumers use more air conditioning or heating, respectively. Conversely, mild weather can result in weaker demand for coal-fired power generation. The Contract Mining segment extracts a significant amount of the annual limestone produced in Florida.
There exists no arrangement or understanding between any executive officer and any other person pursuant to which such executive officer was selected. EXECUTIVE OFFICERS OF THE COMPANY Name Age Current Position J.C. Butler, Jr. 64 President and Chief Executive Officer of NACCO and President and Chief Executive Officer of NACCO Natural Resources Corporation (NNRC) (from prior to 2019) Elizabeth I.
There exists no arrangement or understanding between any executive officer and any other person pursuant to which such executive officer was selected. EXECUTIVE OFFICERS OF THE COMPANY Name Age Current Position J.C. Butler, Jr. 65 President and Chief Executive Officer of NACCO and President and Chief Executive Officer of NACCO Natural Resources Corporation (NNRC) (from prior to 2020) Elizabeth I.
The cost of obtaining surface mining permits can vary widely depending on the quantity and type of information that must be provided to obtain the permits. 9 Table of Contents SMCRA establishes operational, reclamation and closure standards for surface coal mines.
The cost of obtaining surface mining permits can vary widely depending on the quantity and type of information that must be provided to obtain the permits. SMCRA establishes operational, reclamation and closure standards for surface coal mines.
Changes in the availability or price of oil and natural gas or other forms of energy, as well as business 6 Table of Contents conditions, conservation, legislation, regulations, and the ability to convert to alternate fuels and other forms of energy may affect the demand for oil and natural gas.
Changes in the availability or price of oil and natural gas or other forms of energy, as well as business conditions, conservation, legislation, regulations, and the ability to convert to alternate fuels and other forms of energy may affect the demand for oil and natural gas.
The Minerals Management segment’s ability to acquire additional properties in the future will be dependent upon our ability to evaluate and select suitable properties and to consummate transactions in a highly competitive environment. Further, oil and natural gas compete with other forms of energy available to customers, primarily based on price.
The Minerals and Royalties segment’s ability to acquire additional properties in the future will be dependent upon our ability to evaluate and select suitable properties and to consummate transactions in a highly 6 Table of Contents competitive environment. Further, oil and natural gas compete with other forms of energy available to customers, primarily based on price.
Some of our properties or mineral interests may be located in areas that are or may be designated as habitats for endangered or threatened species, and previously unprotected species may later be designated as threatened or endangered in areas where we hold interests.
Some of our properties, projects or mineral interests may be located in areas that are or may be designated as habitats for endangered or threatened species, and previously unprotected species may later be designated as threatened or endangered in areas where we own property, projects or mineral interests.
The rule also includes new testing and reporting requirements, such as: (i) the requirement to submit cementing reports after well completion or after cessation of drilling, whichever is later; and (ii) the imposition of additional testing on wells less than 1,000 feet below usable groundwater. The well integrity rule took effect in January 2014.
The rule also includes new testing and reporting requirements, such as: (i) the requirement to submit cementing reports after well completion or after cessation of drilling, whichever is later; and (ii) the imposition of additional testing on wells less than 1,000 feet below usable groundwater.
NACCO believes we have good relations with our employees. Market-Based Compensation: We believe our employees are critical to our success and we invest in our employees by offering a market-based competitive total rewards package that includes a combination of salaries and wages and a benefits package that promotes employee well-being across all aspects of their lives.
Market-Based Compensation: We believe our employees are critical to our success and we invest in our employees by offering a market-based competitive total rewards package that includes a combination of salaries and wages and a benefits package that promotes employee well-being across all aspects of their lives.
As a mineral owner, we have limited access to timely information, involvement, and operational control over the volumes of oil, gas and coal produced and sold and the terms and conditions, including price, on which such volumes are marketed and sold. In 2024 and 2023, three customers and two customers, respectively, accounted for more than 10% of consolidated revenue.
As a mineral owner, we have limited access to timely information, involvement, and operational control over the volumes of oil, gas and coal produced and sold and the terms and conditions, including price, on which such volumes are marketed and sold. In both 2025 and 2024, three customers accounted for 10% or more of consolidated revenue.
In May 2023, the EPA published proposed regulations that would impose federal regulatory requirements for previously exempt inactive CCR surface impoundments at inactive facilities (legacy CCR surface impoundments).
In May 2023, the EPA published proposed regulations that would impose federal regulatory requirements for previously exempt inactive CCR surface impoundments at inactive facilities (legacy CCR surface impoundments) and CCR Management Units (CCRMUs).
We also manage legacy royalty and mineral interests located in Ohio (Utica and Marcellus shale natural gas), Louisiana (Haynesville shale and Cotton Valley formation natural gas), Texas (Cotton Valley and Austin Chalk formation natural gas), Mississippi (coal), Pennsylvania (coal, coalbed methane and Marcellus shale natural gas), Alabama (coal, coalbed methane and natural gas) and North Dakota (coal, oil and natural gas).
The Minerals and Royalties segment also manages legacy royalty and mineral interests located in Ohio (Utica and Marcellus shale natural gas), Louisiana (Haynesville shale and Cotton Valley formation natural gas), Texas (Cotton Valley and Austin Chalk formation natural gas), Mississippi (coal), Pennsylvania (coal, coalbed methane and Marcellus shale natural gas), Alabama (coal, coalbed methane and natural gas) and North Dakota (coal, oil and natural gas).
Weather conditions affect the demand for, and prices of, natural gas and can also delay drilling activities. Demand for natural gas is typically higher during the winter, resulting in higher natural gas prices during the first and fourth quarters.
Weather conditions affect the demand for, and prices of, natural gas and can also delay drilling activities. Demand for natural gas is typically higher during the winter, resulting in higher natural gas prices during the first and fourth quarters. Seasonal weather conditions can limit drilling and producing activities and other oil and natural gas operations.
Minerals Management Segment The Minerals Management segment derives income primarily by leasing our royalty and mineral interests to third-party exploration and production companies, and, to a lesser extent, other mining companies, granting them the rights to explore, develop, mine, produce, market and sell gas, oil, and coal in exchange for royalty payments based on the lessees' sales of those minerals.
Minerals and Royalties Segment The Minerals and Royalties segment derives income primarily by leasing our royalty and mineral interests to third-party exploration and production companies, and, to a lesser extent, other mining companies, granting them the rights to explore, develop, mine, produce, market and sell gas, oil, and coal in exchange for royalty payments based on the lessees' sales of those minerals. 4 Table of Contents The Minerals and Royalties segment owns royalty interests, mineral interests, non-participating royalty interests and overriding royalty interests (collectively mineral and royalty interests). • Royalty Interest.
The majority of our legacy reserves were acquired as part of our historical coal mining operations. Total oil and gas mineral and royalty interests include approximately 198.4 thousand gross acres and 63.9 thousand net royalty acres at December 31, 2024.
The majority of our legacy reserves were acquired as part of our historical coal mining operations. Total oil and gas mineral and royalty interests include approximately 208.0 thousand gross acres and 64.4 thousand net royalty acres at December 31, 2025.
Loveman 55 Senior Vice President and Controller and Principal Financial Officer (from prior to 2019) John D. Neumann 49 Senior Vice President, General Counsel and Secretary of NACCO, Senior Vice President, General Counsel and Secretary of NNRC (from prior to 2019) Thomas A.
Loveman 56 Senior Vice President and Controller and Principal Financial Officer (from prior to 2020) John D. Neumann 50 Senior Vice President, General Counsel and Secretary of NACCO, Senior Vice President, General Counsel and Secretary of NNRC (from prior to 2020) Thomas A.
Federal, state and local regulations provide detailed requirements for the abandonment of wells, closure or decommissioning of production facilities and pipelines and for site restoration in areas where the operators of the acreage underlying our mineral and royalty interests operate. The U.S.
Federal, state and local regulations provide detailed requirements for the abandonment of wells, closure or decommissioning of production facilities and pipelines and for site restoration in areas where the operators of the acreage underlying our mineral and royalty interests operate. The USACE and many other state and local authorities also have regulations for plugging and abandonment, decommissioning and site restoration.
Benefits offered to employees include: • Medical, dental and vision benefits for employees, spouses and dependents; • Flexible spending accounts for both healthcare and dependent care; • Health savings accounts and health reimbursement accounts, both of which receive company contributions; • Paid vacation and holidays; • Parental leave; • Short-term and long-term disability benefits; • Wellness incentives for employees; • Life and AD&D insurance benefits; • Identity protection benefits; • Charitable donation matches; and • Employee assistance program. 7 Table of Contents Employee Development: We recognize that our culture and success is strengthened when employees are respected, motivated and engaged.
Benefits offered to employees include: • Medical, dental and vision benefits for employees, spouses and dependents; • Flexible spending accounts for both healthcare and dependent care; • Health savings accounts and health reimbursement accounts, certain of which receive company contributions; • Paid vacation and holidays; • Parental leave; • Short-term and long-term disability benefits; • Wellness incentives and programs for employees; 7 Table of Contents • Life and AD&D insurance benefits; • Identity protection benefits; • Charitable donation matches; and • Employee assistance program.
Dewing 68 Senior Vice President and Chief Operating Officer of NNRC (from prior to 2019) John D. Neumann 49 Senior Vice President, General Counsel and Secretary of NACCO, Senior Vice President, General Counsel and Secretary of NNRC (from prior to 2019) J. Patrick Sullivan, Jr. 66 Senior Vice President and Chief Financial Officer of NNRC (from prior to 2019)
Dewing 69 Senior Vice President and Chief Operating Officer of NNRC (from prior to 2020) John D. Neumann 50 Senior Vice President, General Counsel and Secretary of NACCO, Senior Vice President, General Counsel and Secretary of NNRC (from prior to 2020) J. Patrick Sullivan, Jr. 67 Senior Vice President and Chief Financial Officer of NNRC (from prior to 2020)
Customers The principal customers of the Coal Mining segment are electric utilities and an independent power provider. The principal customers of the NAMining segment are limestone producers and to a lesser extent, sand and gravel producers. In addition, NAMining will serve as exclusive contract miner for the Thacker Pass lithium project in northern Nevada.
The principal customers of the Contract Mining segment are limestone producers and to a lesser extent, construction firms and sand and gravel producers. In addition, the Contract Mining segment will serve as exclusive contract miner for the Thacker Pass lithium project in northern Nevada.
NPRI is an interest in oil and gas production which is created from the mineral estate. The NPRI is expense-free, bearing no operational costs of production. The term non-participating indicates that the interest owner does not share in the bonus, rentals from a lease, nor the right to participate in the execution of oil and gas leases.
The NPRI is expense-free, bearing no operational costs of production. The term non-participating indicates that the interest owner does not share in the bonus, rentals from a lease, nor the right to participate in the execution of oil and gas leases. The NPRI owner does; however, typically receive royalty payments. • Overriding Royalty Interest (ORRIs).
Maxwell 47 Senior Vice President - Financial Planning and Analysis and Treasurer (from prior to 2019) PRINCIPAL OFFICERS OF THE COMPANY’S SUBSIDIARIES Name Age Current Position J.C. Butler, Jr. 64 President and Chief Executive Officer of NACCO and President and Chief Executive Officer of NNRC (from prior to 2019) Carroll L.
Maxwell 48 Senior Vice President - Finance and Treasurer (from prior to 2020) PRINCIPAL OFFICERS OF THE COMPANY’S SUBSIDIARIES Name Age Current Position J.C. Butler, Jr. 65 President and Chief Executive Officer of NACCO and President and Chief Executive Officer of NNRC (from prior to 2020) Carroll L.
NAMining provides contract mining services for independently owned mines and quarries, creating value for our customers by performing the mining aspects of our customers’ operations. This allows customers to focus on their areas of expertise: materials handling and processing, product sales and distribution. As of December 31, 2024, NAMining operates in Florida, Texas, Arkansas, Virginia and Nebraska.
Contract Mining provides contract mining services for independently owned mines and quarries, creating value for our customers by performing the mining aspects of our customers’ operations. This allows customers to focus on their areas of expertise: materials handling and processing, product sales and distribution.
NACCO is not the primary beneficiary of the VIE as it does not exercise financial control; therefore, we do not consolidate the results of these operations within our financial statements. Instead, this contract is accounted for as an equity method investment.
In each case, NACCO is not the primary beneficiary of the VIE as it does not exercise financial control; therefore, we do not consolidate the results of these operations within our financial statements. Instead, these contracts are accounted for as equity method investments.
The following represents the revenue attributable to each of these entities as a percentage of consolidated revenue for those years: 5 Table of Contents Percentage of Consolidated Revenues Segment 2024 2023 Coal Mining customer 29 % 40 % NAMining customer 24 % 22 % NAMining customer 11 % 7 % The loss of any of these customers could have a material adverse effect on the results of operations attributable to the applicable segment and on our consolidated results of operations.
The following represents the revenue attributable to each of these entities as a percentage of consolidated revenue for those years: Percentage of Consolidated Revenues Segment 2025 2024 Utility Coal Mining customer 31 % 29 % Contract Mining customer 25 % 24 % Contract Mining customer 10 % 11 % The loss of any of these customers could have a material adverse effect on the results of operations attributable to the applicable segment and on our consolidated results of operations.
Available Information We make our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports available through our website, www.nacco.com, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission (SEC).
We will match employee contributions up to $5,000 per employee if program criteria are met. 8 Table of Contents Available Information We make our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports available through our website, www.nacco.com, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the Securities and Exchange Commission (SEC).
Like royalty interests, ORRIs do not confer an obligation to make capital expenditures or pay for lease 4 Table of Contents operating expenses and have limited environmental liability; however, ORRIs may be calculated net of post-production expenses, depending on how the ORRI is structured.
ORRIs are created by carving out the right to receive royalties from a working interest. Like royalty interests, ORRIs do not confer an obligation to make capital expenditures or pay for lease operating expenses and have limited environmental liability; however, ORRIs may be calculated net of post-production expenses, depending on how the ORRI is structured.
We offer a 100% 401(k) matching contribution up to 5% of compensation, which is immediately vested. Additionally, NACCO offers a generous profit-sharing contribution for all of our full-time and part-time employees. We provide employee wages that are competitive and consistent with employee positions, skill levels, experience, knowledge and geographic location.
Additionally, NACCO offers a generous profit-sharing contribution for all of our full-time and part-time employees. We provide employee wages that are competitive and consistent with employee positions, skill levels, experience, knowledge and geographic location.
NACCO believes in making long-term investments in the areas where we operate by supporting numerous charitable efforts, including educational, arts and community organizations. Community engagement is encouraged and supported through our matching gift program. We will match employee contributions up to $5,000 per employee if program criteria are met.
NACCO believes in making long-term investments in the areas where we operate by supporting numerous charitable efforts, including educational, arts and community organizations. Community engagement is encouraged and supported through our matching gift program.
Mine Health and Safety Laws The Federal Mine Safety and Health Act of 1977 imposes safety and health standards on all mining operations. Regulations are comprehensive and affect numerous aspects of mining operations, including training of mine personnel, mining procedures, blasting, the equipment used in mining operations and other matters.
Regulations are comprehensive and affect numerous aspects of mining operations, including training of mine personnel, mining procedures, blasting, the equipment used in mining operations and other matters. The Federal Mine Safety and Health Administration enforces compliance with these federal laws and regulations.
Due to these seasonal fluctuations, Minerals Management results of operations for individual quarterly periods may not be indicative of the results that may be realize on an annual basis. Human Capital As of December 31, 2024, we had approximately 1,700 employees, including approximately 1,100 employees at our unconsolidated mining operations, none of which are represented by a collective bargaining agreement.
Due to these seasonal fluctuations, the Minerals and Royalties segment's results of operations for individual quarterly periods may not be indicative of the results that may be realized on an annual basis. Human Capital As of December 31, 2025, we had approximately 1,700 employees, including approximately 1,100 employees at our unconsolidated mining operations.
The holder of a mineral interest has the right to lease the minerals to an exploration and production company. Upon the execution of an oil and gas lease, the lessee (the exploration and production company) becomes the working interest owner and the lessor (the mineral interest owner) has a royalty interest. • Non-Participating Royalty Interest (NPRIs).
Upon the execution of an oil and gas lease, the lessee (the exploration and production company) becomes the working interest owner and the lessor (the mineral interest owner) has a royalty interest. • Non-Participating Royalty Interest (NPRIs). NPRI is an interest in oil and gas production which is created from the mineral estate.
MLMC sells coal to its customer at a contractually agreed-upon price which adjusts monthly, primarily based on changes in the level of established indices which reflect general U.S. inflation rates. Profitability at MLMC is affected by customer demand for coal and changes in the indices that determine sales price and actual costs incurred.
MLMC sells coal to its customer at a contractually agreed-upon price which adjusts monthly, primarily based on changes in the level of established indices which reflect general U.S. inflation rates and includes adjustments for coal quality and certain reimbursable costs.
The new rule does not go into effect in states where a stay had been issued for the previous rule, including North Dakota, Texas, Louisiana, and Mississippi. In these states, the legal challenges to this rule have resumed.
As a result of the Sackett decision, the EPA and the USACE revised the definition of WOTUS and promulgated a final rule. The new rule did not go into effect in states where a stay had been issued for the previous rule, including North Dakota, Texas, Louisiana, and Mississippi. In these states, the legal challenges to this rule have resumed.
In May 2024, the EPA published a final rule amending CCR regulations which introduces new requirements for the management of coal ash at active coal-fired power plants and inactive coal-fired power plants with a legacy surface impoundment.
In May 2024, the EPA published a final rule amending CCR regulations which introduced new requirements for the management of coal ash at active coal-fired power plants and inactive coal-fired power plants with a legacy surface impoundment. The regulations impose new requirements including groundwater monitoring, closure standards, post-closure care obligations, and potential remediation activities.
Net royalty acres are calculated based on our ownership and royalty rate, normalized to a standard 1/8 th royalty lease, and assumes a 1/4 th royalty rate for unleased acres. See Item 2. Properties on page 29 in this Form 10-K for discussion of our proved reserves.
Net royalty acres are calculated based on our ownership and royalty rate, normalized to a standard 1/8 th royalty lease, and assumes a 1/4 th royalty rate for unleased acres. See Item 2.
Certain coal supply contracts can be terminated early, which would result in a reduction to future earnings. The MLMC contract is the only coal supply contract in which we are responsible for all operating costs, capital requirements and final mine reclamation; therefore, MLMC is consolidated within our financial statements.
The MLMC contract is the only coal supply contract in which we are responsible for all operating costs, capital requirements and final mine reclamation; therefore, MLMC is consolidated within our financial statements.
Every employee is responsible and accountable for safety performance. Company Ethics: We have processes in place for compliance with our Code of Corporate Conduct, Insider Trading Policy and Anti-Corruption Policy. All of our Directors and employees annually complete certifications with respect to compliance with our Code of Corporate Conduct.
Company Ethics: We have processes in place for compliance with our Code of Corporate Conduct, Insider Trading Policy and Anti-Corruption Policy. All of our Directors and employees annually complete certifications to comply with our Code of Corporate Conduct. In addition, all of our employees are required to complete annual Code of Corporate Conduct training.
In addition to these federal environmental laws, various states have enacted environmental laws that provide for higher levels of environmental compliance than similar federal laws. These state environmental laws require reporting, permitting and/or approval of many aspects of coal mining operations. Both federal and state inspectors regularly visit mines to enforce compliance.
In addition to these federal environmental laws, various states have enacted environmental laws that provide for higher levels of environmental compliance than similar federal laws. These state environmental laws require reporting, permitting and/or approval of many aspects of operations. We have ongoing training, compliance and permitting programs to ensure compliance with such environmental laws.
Among the factors that affect competition are the price and availability of oil and natural gas, environmental and related political considerations, the time and expenditures required to develop new energy sources, the cost of transportation, the cost of compliance with governmental regulations, the impact of federal and state energy policies, the impact of subsidies on pricing of renewable energy and our customers' dispatch decisions, which may also take into account carbon dioxide emissions.
Among the factors that affect competition are the price and availability of oil and natural gas, our customers' dispatch decisions, the time and expenditures required to develop energy sources, the cost of transportation, the cost of compliance with governmental regulations and the impact of federal and state energy policies.
We have items not directly attributable to a reportable segment that are not included in the reported financial results of the operating segment. These items primarily include administrative costs related to public company reporting requirements, including management and board compensation, and the financial results of Bellaire Corporation (Bellaire), Mitigation Resources, ReGen Resources and other developing businesses.
ReGen Resources is pursuing opportunities to develop new power generation resources. We also have items not directly attributable to an operating segment. These items primarily include administrative costs related to public company reporting requirements, including management and board compensation, the financial results of developing businesses and Bellaire Corporation (Bellaire).
Instead, these contracts are accounted for as equity method investments. The income before income taxes associated with these VIEs is reported as Earnings of unconsolidated operations on the Consolidated Statements of Operations and our investment is reported on the line Investments in unconsolidated subsidiaries in the Consolidated Balance Sheets.
The income before income taxes associated with these VIEs is reported as Earnings of unconsolidated operations on the Consolidated Statements of Operations and our investment is reported on the line Investments in unconsolidated subsidiaries in the Consolidated Balance Sheets. The mines that meet the definition of a VIE are referred to collectively as the Unconsolidated Subsidiaries.
In addition, hydraulic fracturing operations require the use of a significant amount of water, and the inability of the operators of the acreage underlying our mineral interests to locate sufficient amounts of water or dispose of or recycle water used in their drilling and production operations could adversely impact their operations.
The inability of the operators of the acreage underlying our mineral interests to locate sufficient amounts of water or dispose of or recycle water used in their drilling and production operations could adversely impact their operations. Moreover, a number of lawsuits and enforcement actions have been initiated across the country implicating hydraulic fracturing practices.
Properties on page 29 in this Form 10-K for discussion of our mineral resources and mineral reserves. NAMining Segment The NAMining segment provides value-added contract mining and other services for producers of industrial minerals. The segment is a platform for our growth and diversification of mining activities outside of the thermal coal industry.
Contract Mining Segment The Contract Mining segment provides value-added contract mining and other services for producers of industrial minerals and products. The segment is a platform for our growth and diversification of mining activities outside of the thermal coal industry.
Surface Mining Control and Reclamation Act SMCRA establishes mining, environmental protection and reclamation standards for all aspects of surface coal mining operations. Where state regulatory agencies have adopted federal mining programs under SMCRA, the state becomes the primary regulatory authority. Coal mine operators must obtain SMCRA permits and permit renewals for coal mining operations from the applicable regulatory agency.
SMCRA stipulates compliance with many other major environmental programs. Where state regulatory agencies have adopted federal mining programs under SMCRA, the state becomes the primary regulatory authority. 9 Table of Contents Coal mine operators must obtain SMCRA permits and permit renewals for coal mining operations from the applicable regulatory agency.
We accrue for the costs of final mine closure, including the cost of treating mine water discharges, at mines where our subsidiaries hold the mining permit. While these obligations are largely unfunded, they can require securitization through bonding, with the exception of the final mine closure costs for the Coyote Creek Mine, which are being funded throughout the production stage.
While these obligations are largely unfunded, they can require securitization through bonding, with the exception of the final mine closure costs for the Coyote Creek Mine, which are being funded by the customers throughout the production stage.
Coal mine wastes, such as overburden and coal cleaning wastes, currently are exempted from hazardous waste management. In 2020, the EPA finalized changes to the coal combustion residual (CCR) rule that classified all clay-lined surface impoundments that receive CCR as unlined.
In 2020, the EPA finalized changes to the coal combustion residual (CCR) rule that classified all clay-lined surface impoundments that receive CCR as unlined.
The Texas Railroad Commission subsequently adopted rules and regulations implementing this legislation that apply to all wells for which the Railroad Commission issues an initial drilling permit.
For example, the Texas Legislature previously adopted legislation requiring oil and gas operators to publicly disclose the chemicals used in the hydraulic fracturing process. The Texas Railroad Commission subsequently adopted rules and regulations implementing this legislation that apply to all wells for which the Railroad Commission issues an initial drilling permit.
During 2024 and 2023, Minerals Management invested a total of $19.1 million, including $15.7 million in the fourth quarter of 2024, in Eiger, which holds non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin. This entity meets the definition of a VIE.
During 2025 and 2024, the Minerals and Royalties segment invested $15.0 million and $16.6 million, respectively, in Eiger Resources, which holds operated and non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin. Eiger Resources meets the definition of a VIE.
On June 5, 2023, the EPA published the FIP in the Federal Register. The FIP decreases, over time, the ozone-season NOx allowances allocated to generators in the states not affected by the judicial stay beginning in 2024 by assuming that participants in this cap-and-trade program had or would optimize existing NOx controls and later install additional NOx controls.
In 2023, the EPA published the Good Neighbor Plan, which decreases, over time, the ozone-season NOx allowances for EGUs in the affected states by assuming that participants in this cap-and-trade program had or would optimize existing NOx controls and later install additional NOx controls. In 2024, the U.S.
Management continues to view our long-term business outlook positively. Our businesses provide critical inputs for electricity generation, construction and development, and the production of industrial minerals and chemicals. Increasing demand for electricity, on-shoring and current federal policies are creating favorable macroeconomic trends within these industries. Management is confident in our trajectory and business prospects as well as longer-term growth opportunities.
Our businesses operate exclusively in the U.S. and provide critical inputs for electricity generation, construction and development, and the production of industrial minerals and products. Increasing demand for electricity, on-shoring and current federal policies are creating favorable macroeconomic trends within these industries. We continue to capitalize on these tailwinds, pursuing longer-term growth opportunities.
Minerals Management Segment During 2024 and 2023, Minerals Management invested a total of $19.1 million, including $15.7 million in the fourth quarter of 2024, in Eiger, LLC (Eiger), which holds non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin.
During 2025 and 2024, the Minerals and Royalties segment invested $15.0 million and $16.6 million, respectively, in Eiger Resources, which holds operated and non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin.
We work to match employees with assignments that capitalize on the skills, talents and potential of each employee, and provides opportunities for professional growth. NACCO believes training is a critical component of employee well-being and growth. Training ranges from equipment-specific task training and enhanced safety procedures to strategic leadership and management training, ethics training and role-specific training.
NACCO believes training is a critical component of employee well-being and growth. Training ranges from equipment-specific task training and enhanced safety procedures to strategic leadership and management training, ethics training and role-specific training. Employees are encouraged to pursue continued professional development, skills training and other educational opportunities.
Royalty interests leased to producers expire upon the expiration of the oil and gas lease and revert to the mineral owner. • Mineral Interest. Mineral interests are perpetual rights of the owner to explore, develop, exploit, mine and/or produce any or all of the minerals lying below the surface of the property.
Mineral interests are perpetual rights of the owner to explore, develop, exploit, mine and/or produce any or all of the minerals lying below the surface of the property. The holder of a mineral interest has the right to lease the minerals to an exploration and production company.
If the original FIP withstands legal challenge, it would increase the cost of operating the customer facility serviced by MLMC. The EPA promulgated a regional haze program designed to protect and to improve visibility at and around Class I Areas, which are generally National Parks, National Wilderness Areas and International Parks.
Regional Haze The EPA promulgated a regional haze program designed to protect and to improve visibility at and around Class I Areas, which are generally National Parks, National Wilderness Areas and International Parks.
In addition, all of our employees are required to complete annual Code of Corporate Conduct training. The Code of Corporate Conduct, Insider Trading Policy and Anti-Corruption Policy require employees to comply with applicable laws and regulations, maintain high ethical standards and report situations of actual or potential noncompliance.
The Code of Corporate Conduct, Insider Trading Policy and Anti-Corruption Policy require employees to comply with applicable laws and regulations, maintain high ethical standards and report situations of actual or potential noncompliance. The Company believes the code and these policies represent sound practices and provide a strong framework for the conduct of our Board and employees.
We cannot predict whether new legislation to regulate oil and natural gas might be proposed, what proposals, if any, might be enacted by Congress or the various state legislatures, and what effect, if any, the proposals might have on the Minerals Management segment.
Although oil and natural gas prices are currently unregulated, Congress historically has been active in the area of oil and natural gas regulation. We cannot predict whether new legislation to regulate oil and natural gas might be proposed, or what proposals, if any, might be enacted by Congress or the various state legislatures.
Changes in environmental laws and regulations occur frequently, and any changes that result in more stringent and costly pollution control or waste handling, storage, transport, disposal or cleanup requirements could materially adversely affect the Minerals Management segment.
Changes in environmental laws and regulations occur frequently, and any changes that result in more stringent and costly pollution control or waste handling, storage, transport, disposal or cleanup requirements could materially adversely affect our business. Surface Mining Control and Reclamation Act (SMCRA) SMCRA establishes mining, environmental protection and reclamation standards for all aspects of surface coal mining operations.
We have strategically leveraged our core mining and natural resources management skills to build a robust portfolio of affiliated businesses and opportunities for additional growth remain strong.
We believe our businesses have competitive advantages that provide value to customers, and the continuing investment in our businesses can create long-term value for stockholders. We have strategically leveraged our core mining and natural resource management skills to build a robust portfolio of affiliated businesses, and opportunities for additional growth remain strong.
Such mandates, combined with other incentives to use renewable energy sources, such as tax credits, make alternative fuel sources more competitive with coal. Fluctuations in natural gas prices and the availability of renewable energy sources, particularly wind, can contribute to changes in power plant dispatch and customer demand for coal.
Fluctuations in natural gas prices and the availability of renewable energy sources can contribute to changes in power plant dispatch and customer demand for coal.
The mines that meet the definition of a VIE are referred to collectively as the Unconsolidated Subsidiaries. For tax purposes, the Unconsolidated Subsidiaries are included within our consolidated U.S. tax return; therefore, the Income tax benefit line on the Consolidated Statements of Operations includes income taxes related to these entities.
For tax purposes, the Unconsolidated Subsidiaries are included within our consolidated U.S. tax return; therefore, the Income tax (benefit) provision line on the Consolidated Statements of Operations includes income taxes related to these entities. See Note 16 to the Consolidated Financial Statements in this Form 10-K for further information on the Unconsolidated Subsidiaries.
The Minerals Management segment owns royalty interests, mineral interests, non-participating royalty interests and overriding royalty interests (collectively mineral and royalty interests). • Royalty Interest. Royalty interests generally result when the owner of a mineral interest leases the underlying minerals to an exploration and production company pursuant to an oil and gas lease.
Royalty interests generally result when the owner of a mineral interest leases the underlying minerals to an exploration and production company pursuant to an oil and gas lease. Typically, the resulting royalty interest is a cost-free percentage of production revenues for minerals extracted from the acreage.
Any such closure of our mines could have a material adverse effect on our business, financial condition and results of operations. In compliance with these regulations, Falkirk's customer, the owner of the Coal Creek Station power plant, submitted a CCR Part B application to the EPA in 2020 asserting a unit complied with the CCR rules.
We are currently unable to predict any specific changes or how such changes, if any, may impact our operations. In compliance with these regulations, Falkirk's customer, the owner of the Coal Creek Station power plant, submitted a CCR Part B application to the EPA in 2020 asserting a unit complied with the CCR rules.
This contract structure eliminates exposure to spot coal market price fluctuations while providing income and cash flow with minimal capital investment. Other than at Coyote Creek, debt financing provided by or supported by the customers is without recourse to us. See Note 16 to the Consolidated Financial Statements in this Form 10-K for further discussion of Coyote Creek's guarantees.
Other than at Coyote Creek, debt financing provided by or supported by the customers is without recourse to us. See Note 16 to the Consolidated Financial Statements in this Form 10-K for further discussion of Coyote Creek's guarantees. Coteau, Coyote Creek, Falkirk and Sabine each meet the definition of a variable interest entity (VIE).
See Note 16 to the Consolidated Financial Statements in this Form 10-K for further information on the Unconsolidated Subsidiaries. We perform contemporaneous reclamation activities at each mine in the normal course of operations. Under all of the Unconsolidated Subsidiaries’ contracts, our customer has the obligation to fund final mine reclamation activities.
We perform contemporaneous reclamation activities at each mine in the normal course of operations. Under all of the Unconsolidated Subsidiaries’ contracts, our customer has the obligation to fund final mine reclamation activities. Under certain contracts, the Unconsolidated Subsidiary holds the mine permit and is therefore responsible for final mine reclamation activities.
As an owner of mineral and royalty interests, we are entitled to a portion of the revenues received from the production of oil, natural gas and associated natural gas liquids, typically net of post-production expenses and taxes.
As an owner of mineral and royalty interests, we are entitled to a portion of the revenues received from the sale of oil, natural gas and associated natural gas liquids. The current portfolio of well-positioned assets is expected to continue to deliver solid financial results.
Hazards in the workplace are actively identified and management tracks incidents so remedial actions can be taken to improve workplace safety. We believe communication related to near misses, safety incidents and protocols is essential to continuously developing and maintaining best-practices related to safety and enables identification and correction of operational practices that might impair employee safety or health.
We believe communication related to safety incidents, near misses and protocols is essential to continuously developing and maintaining robust safety practices. This communication also enables the identification and correction of operational practices that might impair employee safety or health. Every employee is responsible and accountable for safety performance.
SWEPCO is an American Electric Power (AEP) company. As a result of the early retirement of the Pirkey Plant, Sabine ceased deliveries and commenced final reclamation on April 1, 2023. Funding for mine reclamation is the responsibility of SWEPCO, and Sabine receives compensation for providing mine reclamation services. Sabine will provide mine reclamation services through September 30, 2026.
All production from Sabine was delivered to Southwestern Electric Power Company's (SWEPCO) Henry W. Pirkey Plant (the Pirkey Plant). SWEPCO is an American Electric Power (AEP) company. As a result of the early retirement of the Pirkey Plant, Sabine ceased deliveries and commenced final reclamation on April 1, 2023.
In addition to providing comprehensive mining services, Sawtooth is currently assisting with certain construction services and will transport clay tailings once lithium production commences.
In addition to providing comprehensive mining services, Sawtooth is currently assisting with certain construction services and will transport clay tailings once lithium production commences. See Item 2. Properties on page 38 in this Form 10-K for a list of the Contract Mining segment's locations and customers.
As diesel fuel is heavily weighted among the indices used to determine the coal sales price, fluctuations in diesel fuel prices can result in significant fluctuations in earnings at MLMC. MLMC's customer operates the Red Hills Power Plant, which supplies electricity to TVA under a long-term power purchase agreement. MLMC’s contract with its customer runs through April 1, 2032.
Profitability at MLMC is affected by customer demand for coal, changes in the contractually determined sales price and actual costs incurred. MLMC's customer operates the Red Hills Power Plant, which supplies electricity to the Tennessee Valley Authority (TVA) under a long-term power purchase agreement. MLMC’s contract with its customer runs through April 1, 2032.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAny reduction in customer demand at MLMC, including, but not limited to, reduced availability of the customer’s power plant, dispatch of power generated by other energy sources, fluctuations in demand due to unanticipated weather conditions, planned and unplanned outages at the customer's Red Hills Power Plant, economic conditions, governmental regulations and inflationary adjustments could have a material adverse effect on MLMC's financial condition, results of operations and cash flows.
Biggest changeAny reduction in customer demand at MLMC, including fluctuations in demand due to planned and unplanned outages at the customer's Red Hills Power Plant, unanticipated weather conditions, economic conditions, governmental regulations and inflationary adjustments could have a material adverse effect on MLMC's financial condition, results of operations and cash flows. 15 Table of Contents Termination of or default under long-term mining contracts could adversely affect our business, financial condition, results of operation and cash flows.
In view of the significant uncertainty surrounding each of these factors, it is not possible for us to predict reasonably the impact that any such laws, regulations or other policies may have on our business, financial condition and results of operations. However, such impacts could have a material adverse effect on our business, financial condition and results of operations.
In view of the significant uncertainty surrounding each of these factors, it is not possible for us to reasonably predict the impact that any such laws, regulations or other policies may have on our business, financial condition and results of operations. However, such impacts could have a material adverse effect on our business, financial condition and results of operations.
As a result, reduced coal usage by customers for any reason, including, but not limited to, reduced availability of the customer’s power plant, dispatch of power generated by other energy sources, fluctuations in demand due to unanticipated weather conditions, planned and unplanned outages at the Coal Mining segment's customers' facilities, economic conditions and governmental regulations could have a material adverse effect on our results of operations.
As a result, reduced coal usage by customers for any reason, including, but not limited to, reduced availability of the customer’s power plant, dispatch of power generated by other energy sources, fluctuations in demand due to unanticipated weather conditions, planned and unplanned outages at the Utility Coal Mining segment's customers' facilities, economic conditions and governmental regulations could have a material adverse effect on our results of operations.
The potential impact on us of future laws, regulations or other policies or circumstances will depend upon the degree to which any such laws, regulations or other policies or circumstances require electricity generators to diminish their reliance on coal as a fuel source. Complicating these matters further, over the last several decades, U.S.
The potential impact of future laws, regulations or other policies or circumstances will depend upon the degree to which any such laws, regulations or other policies or circumstances require electricity generators to diminish their reliance on coal as a fuel source. Complicating these matters further, over the last several decades, U.S.
The Coal Mining segment's Unconsolidated Subsidiaries are subject to risks created by changes in customer demand and inflationary adjustments. The contracts with the Unconsolidated Subsidiaries' customers are primarily based on a management fee approach, whereby compensation includes reimbursement of all operating costs, plus a fee based on the amount of coal delivered.
The Utility Coal Mining segment's Unconsolidated Subsidiaries are subject to risks created by changes in customer demand and inflationary adjustments. The contracts with the Unconsolidated Subsidiaries' customers are primarily based on a management fee approach, whereby compensation includes reimbursement of all operating costs, plus a fee based on the amount of coal delivered.
We anticipate that it will continue to incur costs and capital expenditures associated with future growth prior to realizing the full measure of anticipated long-term benefits, and the return on these investments may be lower, may develop more slowly than expected or may never be realized.
We anticipate that we will continue to incur costs and capital expenditures associated with future growth prior to realizing the full measure of anticipated long-term benefits, and the return on these investments may be lower, may develop more slowly than expected or may never be realized.
Increasing attention to climate change risk has also resulted in a recent trend of governmental investigations and private litigation by local and state governmental agencies as well as private plaintiffs in an effort to hold energy companies accountable for the effects of climate change.
Increasing attention to climate change risk has also resulted in a recent trend of governmental investigations and private litigation by local and state governmental agencies as well as private plaintiffs in an effort to hold energy companies accountable for the alleged effects of climate change.
Earnings from the Coal Mining segment's customers may fluctuate from time to time based on numerous factors, including market conditions and the realignment of customers' power generation portfolios that reduce the electric power generated from coal, which may be outside of our control.
Earnings from the Utility Coal Mining segment's customers may fluctuate from time to time based on numerous factors, including market conditions and the realignment of customers' power generation portfolios that reduce the electric power generated from coal, which may be outside of our control.
Any delay or reduction in making capital expenditures to maintain or upgrade coal-fired power plants by the Coal Mining segment's customers, principally electric utilities, could result in an increase in outage days and a corresponding decrease in coal consumption.
Any delay or reduction in making capital expenditures to maintain or upgrade coal-fired power plants by the Utility Coal Mining segment's customers, principally electric utilities, could result in an increase in outage days and a corresponding decrease in coal consumption.
If any of the Coal Mining segment's customers experience declining demand due to market, economic, regulatory or competitive conditions, it could have an adverse effect on our profitability, cash flows and financial position.
If any of the Utility Coal Mining segment's customers experience declining demand due to market, economic, regulatory or competitive conditions, it could have an adverse effect on our profitability, cash flows and financial position.
We have not been made a party to these suits, but it is possible that we could be included in similar future lawsuits initiated by state and local governments as well as private claimants. 26 Table of Contents Our business could suffer if NACCO’s information technology systems are disrupted, cease to operate effectively or if we experience a security breach, a cyber incident or cyber attack.
We have not been made a party to these suits, but it is possible that we could be included in similar future lawsuits initiated by state and local governments as well as private claimants. 22 Table of Contents Our business could suffer if NACCO’s information technology systems are disrupted, cease to operate effectively or if we experience a security breach, a cyber incident or cyber attack.
The decision to pursue development and operation of oil and gas wells is made by third-party operators, not by us, and depends on a number of factors outside of our control, including fluctuations in commodity prices (primarily natural gas), regulatory risk, our lessees' willingness and ability to incur well-development and other operating costs, the rate of production of the reserves and changes in the availability and continuing development of infrastructure.
The decision to pursue development and operation of oil and gas wells is made by third-party operators, not by us, and depends on a number of factors outside of our control, including fluctuations in commodity prices, regulatory risk, our lessees' willingness and ability to incur well-development and other operating costs, the rate of production of the reserves and changes in the availability and continuing development of infrastructure.
While all of our operations are located in the United States, we participate in a global supply chain, and if governments regulate or restrict the flow of labor or products or impede the travel of our personnel, our ability to conduct normal business operations could be impacted which could adversely affect our results of operations and liquidity.
While all of our operations are located in the United States, we participate in a global supply chain, and if governments regulate or restrict the flow of labor or products or impede the travel of our personnel, our ability to conduct normal business operations could be impacted which could adversely affect our results of operations and liquidity. Item 1B.
These projects are subject to significant risks, including delays or reductions in making capital expenditures by NAMining's customers, timely regulatory approvals, extreme weather events, unexpected increases in the cost of required materials, and disputes with third party providers of materials, equipment or services, and a completed project may not yield the anticipated operational or financial benefit, any of which could have a material adverse effect on our business, financial condition and results of operations.
These projects are subject to significant risks, including delays or reductions in making capital expenditures by Contract Mining's customers, timely regulatory approvals, extreme weather events, unexpected increases in the cost of required materials, and disputes with third party providers of materials, equipment or services, and a completed project may not yield the anticipated operational or financial benefit, any of which could have a material adverse effect on our business, financial condition and results of operations.
Any significant disruption in the U.S. power grid, gathering system or transportation, processing, or refining-facility capacity could reduce our third-party lessee’s ability to market oil production and may adversely affect the Minerals Management segment’s financial condition or results of operations.
Any significant disruption in the U.S. power grid, gathering system or transportation, processing, or refining-facility capacity could reduce our third-party lessee’s ability to market oil production and may adversely affect the Minerals and Royalties segment’s financial condition or results of operations.
A substantial or extended decline in commodity prices may adversely affect the Minerals Management segment’s financial condition or results of operations. The marketability of oil and natural gas production is dependent upon transportation, pipelines and refining facilities and continued operation of the U.S. power grid.
A substantial or extended decline in commodity prices may adversely affect the Minerals and Royalties segment’s financial condition or results of operations. The marketability of oil and natural gas production is dependent upon transportation, pipelines and refining facilities and continued operation of the U.S. power grid.
The future cash flow and results of operations of the Minerals Management segment are highly dependent on third-party operators’ success in developing our current and future mineral and royalty interests. These operators may not have access to the capital needed to develop our mineral interests.
The future cash flow and results of operations of the Minerals and Royalties segment are highly dependent on third-party operators’ success in developing our current and future mineral and royalty interests. These operators may not have access to the capital needed to develop our mineral interests.
In addition, if any customers were to significantly reduce or eliminate their purchases of coal from us or if we are unable to renew expiring long-term sales agreements with existing customers or enter into new supply agreements, our business, financial condition, results of operations and cash flows could be adversely affected. See Item 1.
In addition, if any customers were to significantly reduce or eliminate their purchases of coal from us or if we are unable to renew expiring long-term sales agreements with existing customers or enter into new supply agreements, our business, financial condition, results of operations and cash flows could be adversely affected.
Holders of Class A common stock are entitled to cast one vote per share and, as of December 31, 2024, accounted for approximately 27 percent of our voting power. Holders of Class B common stock are entitled to cast ten votes per share and, as of December 31, 2024, accounted for our remaining voting power.
Holders of Class A common stock are entitled to cast one vote per share and, as of December 31, 2025, accounted for approximately 27 percent of our voting power. Holders of Class B common stock are entitled to cast ten votes per share and, as of December 31, 2025, accounted for our remaining voting power.
In addition, if we are able to enter into a new 22 Table of Contents lease with a new lessee, the replacement lessee may not achieve the same levels of production or sales prices as the lessee it replaced. Any of these risks could materially reduce our expected royalty income and profitability. Minerals are a depleting asset.
In addition, if we are able to enter into a new lease with a new lessee, the replacement lessee may not achieve the same levels of production or sales prices as the lessee it replaced. Any of these risks could materially reduce our expected royalty income and profitability. Minerals are a depleting asset.
The public, including non-governmental organizations, opposition groups and individuals, have statutory rights to comment upon and submit objections to requested permits and 18 Table of Contents approvals and to legally challenge certain permits subsequent to their issuance. Compliance with these requirements is costly and time-consuming and may delay commencement or continuation of development or production.
The public, including non-governmental organizations, opposition groups and individuals, have statutory rights to comment upon and submit objections to requested permits and approvals and to legally challenge certain permits subsequent to their issuance. Compliance with these requirements is costly and time-consuming and may delay commencement or continuation of development or production.
If we are unable to manage this growth and the associated expenses effectively, we may not be able to take advantage of market opportunities or remain competitive. We may also fail to execute on our business plan or respond to competitive pressures, any of which could adversely affect the NAMining business, operating results and financial condition.
If we are unable to manage this growth and the associated expenses effectively, we may not be able to take advantage of market opportunities or remain competitive. We may also fail to execute on our business plan or respond to competitive pressures, any of which could adversely affect the Contract Mining business, operating results and financial condition.
There are risks associated with NACCO's ability to execute on our longer term growth strategy, including our investment in mitigation solutions, comprehensive reclamation and restoration construction services as well as clean energy projects through our Mitigation Resources of North America and ReGen Resources businesses, and our ability to develop and manage such projects profitably.
There are risks associated with NACCO's ability to execute on our longer term growth strategy, including our investment in mitigation solutions, comprehensive reclamation and restoration construction services as well as other energy-related projects through our Mitigation Resources of North America and ReGen Resources businesses, and our ability to develop and manage such projects profitably.
The coal mining industry and the electric generation industry are subject to extensive regulation by federal, state and local authorities on matters concerning the health and safety of employees, land use, stream and wetland protection, permit and licensing requirements, air and water quality standards, plant and wildlife protection, reclamation and restoration of mining properties after mining, the discharge of GHGs and other materials into the environment, surface subsidence from underground mining and the effects that mining has on groundwater quality and availability.
The coal mining industry and the electric generation industry are subject to extensive regulation by federal, state and local authorities on matters concerning the health and safety of employees, land use, stream and wetland protection, permit and licensing requirements, air and water quality standards, plant and wildlife protection, reclamation and restoration of mining properties after mining, the discharge of GHGs and other materials into the environment and the effects that mining has on groundwater quality and availability.
Historically, oil and natural gas prices have been volatile and are subject to fluctuations in response to changes in: supply and demand, including if energy supply exceeds demand; market uncertainty and a variety of additional factors that are beyond our control; market expectations about future prices of oil and natural gas; the level of global oil and natural gas exploration and production; the cost of exploring for, developing, producing and delivering oil and natural gas; the price and quantity of foreign imports and U.S. exports of oil and natural gas; the level of U.S. domestic production; political and economic conditions in oil producing regions; the ability of members of the Organization of Petroleum Exporting Countries to agree to and maintain oil price and production controls; trading in oil and natural gas derivative contracts; the level of consumer product demand; weather conditions and natural disasters; technological advances affecting energy consumption, energy storage and energy supply; domestic and foreign governmental regulations and taxes; the continued threat of terrorism and the impact of military and other action, including ongoing conflicts in foreign nations and associated oil and natural gas import bans as well as economic sanctions such as those imposed by the U.S. on oil and gas exports from Iran; the proximity, cost, availability and capacity of oil and natural gas pipelines and other transportation facilities; the price and availability of alternative fuels; volatility in the political, legal and regulatory environments due to the U.S. presidential election; and overall domestic and global economic conditions.
Historically, oil and natural gas prices have been volatile and are subject to fluctuations in response to changes in: supply and demand, including if energy supply exceeds demand; market uncertainty and a variety of additional factors that are beyond our control; market expectations about future prices of oil and natural gas; the level of global oil and natural gas exploration and production; the cost of exploring for, developing, producing and delivering oil and natural gas; the price and quantity of foreign imports and U.S. exports of oil and natural gas; the level of U.S. domestic production; political and economic conditions in oil producing regions; the ability of members of the Organization of Petroleum Exporting Countries to agree to and maintain oil price and production controls; trading in oil and natural gas derivative contracts; the level of consumer product demand; weather conditions and natural disasters; technological advances affecting energy consumption, energy storage and energy supply; domestic and foreign governmental regulations and taxes; the continued threat of terrorism and the impact of military and other action, including ongoing conflicts in foreign nations and associated oil and natural gas import bans as well as economic sanctions; the proximity, cost, availability and capacity of oil and natural gas pipelines and other transportation facilities; the price and availability of alternative fuels; volatility in the political, legal and regulatory environments; and overall domestic and global economic conditions.
Future federal and state laws and regulations, regional transmission organizations and power purchase agreement customers may require higher amounts of financial security, including as a result of changes to certain factors used 25 Table of Contents to calculate the bonding or security amounts.
Future federal and state laws and regulations, regional transmission organizations and power purchase agreement customers may require higher amounts of financial security, including as a result of changes to certain factors used to calculate the bonding or security amounts.
These include political and regulatory developments that may make it more costly, or impossible, to pursue these business opportunities, logistical risks and potential delays related to construction, permitting and regulatory approvals; operational risk that the projects will not perform according to expectations; weather conditions or other factors beyond our 23 Table of Contents control.
These include political and regulatory developments that may make it more costly, or impossible, to pursue these business opportunities, logistical risks and potential delays related to construction, permitting and regulatory approvals; operational risk that the projects will not perform according to expectations; weather conditions or other factors beyond our control.
The following risk factors are not an exhaustive list of the risks associated with our business. New factors may emerge or changes to these risks could occur that could materially affect our business.
The following risk factors are not an exhaustive list of the risks associated with our business. New factors may emerge or changes to these risks could occur that could materially affect our business. See Item 1.
The price of our common stock may fluctuate due to a variety of market and industry factors that may materially reduce the market price of NACCO's common stock regardless of operating performance, including, among others: (i) actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in the industry; (ii) industry cycles and trends; (iii) changes in government regulation; (iv) potential or actual military conflicts or acts of terrorism; (v) announcements concerning NACCO, our customers or competitors; (vi) lack of trading liquidity as a result of low trading volumes could make it difficult for investors to sell shares; and (vii) the general state of the securities market.
The price of our common stock may fluctuate due to a variety of market and industry factors that may materially reduce the market price of NACCO's common stock regardless of operating performance, including, among others: (i) actual or anticipated fluctuations in our quarterly and annual results and those of other public companies in the industry; (ii) industry cycles and trends; (iii) changes in government regulation; (iv) military conflicts, inclusive of acts of terrorism; (v) supply chain disruptions, inclusive of tariff effects; (vi) announcements concerning NACCO, our customers or competitors; (vii) lack of trading liquidity as a result of low trading volumes could make it difficult for investors to sell shares; and (viii) the general state 20 Table of Contents of the securities market.
The Board of Directors has the power to determine the amount and frequency of the payment of dividends. Decisions regarding whether or not to pay dividends and the amount of any dividends are based on earnings, capital and future expense requirements, financial conditions and other factors the Board of Directors may consider.
Decisions regarding whether or not to pay dividends and the amount of any dividends are based on earnings, capital and future expense requirements, financial conditions and other factors the Board of Directors may consider.
These factors and assumptions include: • Geologic and mining conditions, including our ability to access certain mineral deposits as a result of the nature of the geologic formations of coal deposits or other factors, which may not be fully identified by available exploration data and may differ from past experience; • Demand for our minerals; • Contractual arrangements, operating costs and capital expenditures; • Development and reclamation costs; • Mining technology and processing improvements; • The effects of regulation by governmental agencies, including volatility in the political, legal and regulatory environments due to the U.S. presidential administration; • The ability to obtain, maintain and renew all required permits; • Employee health and safety; and • Our ability to convert all or any part of mineral resources to economically extractable mineral reserves.
These factors and assumptions include: • Geologic and mining conditions, including our ability to access certain mineral deposits as a result of the nature of the geologic formations of coal deposits or other factors, which may not be fully identified by available exploration data and may differ from past experience; • Demand for our minerals; • Contractual arrangements, operating costs and capital expenditures; • Development and reclamation costs; • Mining technology and processing improvements; • The effects of regulation by governmental agencies, including volatility in the political, legal and regulatory environments due to the U.S. presidential administration; • The ability to obtain, maintain and renew all required permits; • Employee health and safety; and • Our ability to convert all or any part of mineral resources to economically extractable mineral reserves. 17 Table of Contents As a result, actual tonnage recovered, estimated revenues, expenditures and cash flows with respect to reserves and resources may vary materially from estimates.
As of December 31, 2024, certain members of our extended founding family held approximately 36 percent of our outstanding Class A common stock and approximately 99 percent of our outstanding Class B common stock. On the basis of this common stock ownership, certain members of our extended founding family could have exercised approximately 82 percent of our total voting power.
As of December 31, 2025, certain members of our extended founding family held approximately 35 percent of our outstanding Class A common stock and approximately 99 percent of our outstanding Class B common stock. On the basis of this common stock ownership, certain members of our extended founding family could have exercised approximately 81 percent of our total voting power.
Any material inaccuracy in estimates related to our reserves or resources could result in lower than expected revenues, higher than expected costs or decreased profitability and changes in future cash flow, which could materially and adversely affect our business, results of operations, financial position and cash flows.
Thus, these estimates may not accurately reflect our actual reserves and resources. Any material inaccuracy in estimates related to our reserves or resources could result in lower than expected revenues, higher than expected costs or decreased profitability and changes in future cash flow, which could materially and adversely affect our business, results of operations, financial position and cash flows.
All of the aforementioned risks could reduce the viability of project development. We have and will continue to incur costs in connection with these projects and the results of operations and/or return on investment could be negative or lower than anticipated and we may need to write-down the value of capitalized assets associated with these projects.
We have and will continue to incur costs in connection with these projects and the results of operations and/or return on investment could be negative or lower than anticipated and we may need to write-down the value of capitalized assets associated with these projects.
The amount of coal consumed by the electric power generation industry is affected by general economic conditions; overall demand for electricity; availability of transmission; competition from alternative fuel sources for power generation, such as natural gas, nuclear, hydroelectric, wind and solar power, and the location, availability, quality and price of those alternative fuel sources; environmental and other governmental regulations, including those impacting coal-fired power plants; and energy conservation efforts and related governmental policies.
The amount of coal consumed by the electric power generation industry is affected by general economic conditions; overall demand for electricity; availability of transmission; competition from alternative fuel sources for power generation, such as natural gas, nuclear, hydroelectric, wind and solar power, and the location, availability, quality and price of those alternative fuel sources; and environmental and other governmental regulations.
NAMining operations are currently geographically concentrated and therefore subject to regional economic risk, regulatory conditions, natural disasters, severe weather events or other circumstances affecting Florida. As of December 31, 2024, over 75% of the quarries NAMining operates are located in Florida.
Contract Mining operations are currently geographically concentrated and therefore subject to regional economic risk, regulatory conditions, natural disasters, severe weather events or other circumstances affecting Florida. As of December 31, 2025, over 80% of the Contract Mining segment's quarries are located in Florida.
Such changes could have a material adverse effect on our business and could significantly reduce our profitability. 20 Table of Contents The Coal Mining segment's customers' operations require significant capital expenditures. Maintaining and installing environmental controls on power plants requires significant capital expenditures.
Such changes could have a material adverse effect on our business and could significantly reduce our profitability. The Utility Coal Mining segment's customers' operations require significant capital expenditures. Maintaining power plants requires significant capital expenditures.
In order to conduct mining operations on properties where these defects exist, we may incur unanticipated costs. In addition, some leases require us to produce a minimum quantity of coal and/or pay minimum production royalties.
In order to conduct mining operations on properties where these defects exist, we may incur unanticipated costs. In addition, some leases require us to produce a minimum quantity of coal and/or pay minimum production royalties. Our inability to satisfy those requirements may cause the leasehold interest to terminate.
NAMining cannot be certain that our existing customers will continue to outsource these services to NAMining in the future, which could adversely affect the NAMining business, operating results and financial condition. We are subject to risks involved in the development of new mining projects. From time to time, we seek to develop new mining projects, including the Thacker Pass project.
We cannot be certain that our existing customers will continue to outsource these services to us in the future, which could adversely affect the Contract Mining business, operating results and financial condition. We are subject to risks involved in the development of new mining projects.
A substantial or extended decline in commodity prices may adversely affect the Minerals Management segment’s financial condition or results of operations. The Minerals Management segment’s revenues and operating results depend significantly upon the prevailing prices for oil and natural gas.
Prices of oil and natural gas are volatile due to factors beyond our control. A substantial or extended decline in commodity prices may adversely affect the Minerals and Royalties segment’s financial condition or results of operations. The Minerals and Royalties segment’s revenues and operating results depend significantly upon the prevailing prices for oil and natural gas.
The risks associated with such projects can be substantial. New mining projects can take up to several years to complete, are complex and require significant capital expenditures.
From time to time, we seek to develop new mining projects, including the Thacker Pass project. The risks associated with such projects can be substantial. New mining projects can take up to several years to complete, are complex and require significant capital expenditures.
We may not be able to acquire or find sufficient additional mineral and royalty interests to replace third-party operators' current and future production. Further, the decline curve we use to project future royalty income is subject to numerous assumptions and limitations.
We may not be able to acquire or find sufficient additional mineral and royalty interests to replace third-party operators' current and future production. Further, the decline curve we use to project future royalty income is subject to numerous assumptions and limitations. Decline rates can vary due to factors like well depth, well length, formation pressure and facility design.
NAMining faces competition from aggregates producers that choose to self-perform mining operations and from other mining companies. NAMining faces competition from existing and prospective customers that are capable of performing, or engaging other companies to perform the services NAMining provides.
Our Contract Mining business faces competition from customers that choose to self-perform mining operations and from other mining companies. We face competition from existing and prospective customers that are capable of performing, or engaging other companies to perform the services we provide.
Limited, or an inability to obtain, insurance coverage, significant increases in the premiums or deductibles of insurance, or losses in excess of our liability insurance coverage limits, could have a material adverse effect on our operating results and financial condition.
Limited, or an inability to obtain, insurance coverage, significant increases in the premiums or deductibles of insurance, or losses in excess of our liability insurance coverage limits, could have a material adverse effect on our operating results and financial condition. We may be subject to litigation seeking to hold energy companies accountable for the effects of climate change.
We have expanded our overall NAMining business, operations and headcount in recent periods. NAMining’s operating expenses may continue to increase as we scale the NAMining business. We must effectively integrate, develop and motivate employees, while integrating new equipment and customers in an efficient and effective manner.
The Contract Mining segment's operating expenses may increase as we continue to scale the Contract Mining business. We must effectively integrate, develop and motivate employees, while integrating new equipment and customers in an efficient and effective manner.
In addition, if we make significant insurance claims under our insurance policies, such claims may have a material adverse effect on our ability to obtain future insurance coverage at commercially reasonable rates.
We hold a number of insurance policies, including director and officers’ liability and property and casualty insurance coverages. If we make significant insurance claims under our insurance policies, such claims may have a material adverse effect on our ability to obtain future insurance coverage at commercially reasonable rates.
Because of the contractual price formulas for the management fees at these Unconsolidated Subsidiaries, the profitability of these operations is also subject to fluctuations in inflationary adjustments (or lack thereof) that can impact the agreed upon management fees. These factors could materially reduce our profitability. Changes in coal consumption patterns of U.S. electric power generators could adversely affect our profitability.
Because of the contractual price formulas for the management fees at these Unconsolidated Subsidiaries, the profitability of these operations is also subject to fluctuations in inflationary adjustments (or lack thereof) that can impact the agreed upon management fees.
If we are unable to meet collateral requirements and cannot otherwise obtain or retain required surety bonds, it may be unable to satisfy legal requirements necessary to conduct mining operations.
Any such factors, could have a material adverse impact on our liquidity and financial position. If we are unable to meet collateral requirements and cannot otherwise obtain or retain required surety bonds, it may be unable to satisfy legal requirements necessary to conduct mining operations.
A security breach and loss of information may not be discovered for a significant period of time after it occurs. Any compromise of data security could result in a violation of applicable privacy and other laws or standards, the loss of valuable business data, or a disruption of our business.
Any compromise of data security could result in a violation of applicable privacy and other laws or standards, the loss of valuable business data, or a disruption of our business.
If we repossessed any of our properties, we would seek a replacement lessee. However, we may not be able to find a replacement lessee or might not be able to enter into a new lease on favorable terms within a reasonable period of time.
A failure on the part of the lessee to make royalty payments may give us certain rights; and if possible, we would seek a replacement lessee. However, we may not be able to find a replacement lessee or might not be able to enter into a new lease on favorable terms within a reasonable period of time.
Furthermore, the stock repurchase program does not obligate us to repurchase any dollar amount or number of shares of our Class A common stock, and it may be suspended or discontinued at any time and any suspension or discontinuation could cause the market price of our Class A common stock to decline. 24 Table of Contents NACCO is a smaller reporting company and cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies will make our common stock less attractive to investors.
Furthermore, the stock repurchase program does not obligate us to repurchase any dollar amount or number of shares of our Class A common stock, and it may be suspended or discontinued at any time and any suspension or discontinuation could cause the market price of our Class A common stock to decline.
Because certain members of our extended founding family could prevent other stockholders from exercising significant influence over significant corporate actions, we may be a less attractive takeover target, which could adversely affect the market price of our common stock.
Because certain members of our extended founding family could prevent other stockholders from exercising significant influence over significant corporate actions, we may be a less attractive takeover target, which could adversely affect the market price of our common stock. 21 Table of Contents General Risk Factors Our effective income tax rate could be volatile and materially change as a result of changes in tax laws, mix of earnings and other factors.
Employee error or other irregularities may also result in a failure of security measures and a breach of information systems. Moreover, hardware, software or applications we may use have inherent defects of design, manufacture or operations or could be inadvertently or intentionally implemented or used in a manner that could compromise information security.
Moreover, hardware, software or applications we may use have inherent defects of design, manufacture or operations or could be inadvertently or intentionally implemented or used in a manner that could compromise information security. A security breach and loss of information may not be discovered for a significant period of time after it occurs.
Substantially all of the Minerals Management segment’s revenues are derived from royalty payments that are based on the price at which oil and natural gas produced from the acreage underlying our interests are sold. Prices of oil and natural gas are volatile due to factors beyond our control.
Any of these risks could materially reduce our expected royalty income and profitability. Substantially all of the Minerals and Royalties segment’s revenues are derived from royalty payments that are based on the price at which oil and natural gas produced from the acreage underlying our interests are sold.
These projects face the risk that the current state regulatory programs and tax laws may expire or be adversely modified and could have a material adverse effect on our operating results and financial condition. Risks related to corporate structure The amount and frequency of dividend payments made on NACCO's common stock could change.
These projects face the risk that the current state regulatory programs and tax laws may expire or be adversely modified and could have a material adverse effect on our operating results and financial condition. Operating results may vary significantly from period to period and are inherently unpredictable.
New legislation and/or regulations and orders may materially adversely affect our mining operations, cost structure or customers. All of these factors could significantly reduce our profitability. Congress has considered climate change legislation aimed at reducing GHG emissions, particularly from coal combustion by power plants.
New legislation and/or regulations and orders may materially adversely affect our mining operations, cost structure or customers. All of these factors could significantly reduce our profitability.
The marketability of our third-party lessee’s production depends in part on the availability, proximity, and capacity of pipelines, tanker trucks, and other transportation methods, and processing and refining facilities owned by third parties as well as continued reliable operation of the U.S power grid.
Any limitation in the availability of these items could interfere with our third-party lessee’s ability to market oil and natural gas production and may adversely affect the Minerals and Royalties segment’s financial condition or results of operations. 19 Table of Contents The marketability of our third-party lessee’s production depends in part on the availability, proximity, and capacity of pipelines, tanker trucks, and other transportation methods, and processing and refining facilities owned by third parties as well as continued reliable operation of the U.S power grid.
Federal and state statutes require us to restore mine property in accordance with specified standards and an approved reclamation plan, and require that we obtain and periodically renew permits for mining operations. Regulations require us to incur the cost of reclaiming current mine disturbance at operations where we hold the mining permit.
We are subject to burdensome federal and state mining regulations and the assumptions underlying our reclamation and mine closure obligations could be materially inaccurate. Federal and state statutes require us to restore mine property in accordance with specified standards and an approved reclamation plan, and require that we obtain and periodically renew permits for mining operations.
We may be unable to obtain financing on reasonable terms. Historically, we have addressed our liquidity needs (including funds required to pay dividends and fund working capital and planned capital expenditures) with operating cash flow and borrowings under credit facilities. Our wholly-owned subsidiary has a revolving line of credit of up to $200.0 million that expires in September 2028.
Current and future capital and credit market conditions could adversely affect our ability to obtain bank financing on reasonable terms. We may be unable to obtain financing on reasonable terms. Historically, we have addressed our liquidity needs (including funds required to pay dividends and fund working capital and planned capital expenditures) with operating cash flow and borrowings under credit facilities.
Business — Business Developments on page 2 in this Form 10-K for further discussion. MLMC is subject to risks associated with our capital investment, operating and equipment costs, growing use of alternative generation that competes with coal-fired generation, changes in customer demand and inflationary adjustments.
Business — Government Regulation and Environmental Matters on page 9 in this Form 10-K for discussion of regulations that could materially adversely affect our businesses. Risks related to the Utility Coal Mining segment MLMC is subject to risks associated with our capital investment, operating and equipment costs, changes in customer demand and inflationary adjustments.
Estimates of our total reclamation and mine closing liabilities are based upon permit requirements and our engineering expertise related to these requirements.
Regulations require us to incur the cost of reclaiming current mine disturbance at operations where we hold the mining permit. Estimates of our total reclamation and mine closing liabilities are based upon permit requirements and our engineering expertise related to these requirements.
See Item 1. Business — Government Regulation on page 9 in this Form 10-K for discussion of regulations that could materially adversely affect the Coal Mining segment. The loss of, or significant reduction in, purchases by NACCO's coal customers could adversely affect our business, financial condition, results of operation and cash flows.
The loss of, or significant reduction in, purchases by NACCO's coal customers could adversely affect our business, financial condition, results of operation and cash flows.
Our inability to satisfy those requirements may cause the leasehold interest to terminate. 21 Table of Contents Risks related to the NAMining segment We have experienced growth in our NAMining business in recent periods and we may not be able to sustain growth or manage future growth effectively.
Risks related to the Contract Mining segment We have experienced growth in our Contract Mining business in recent periods and we may not be able to sustain growth or manage future growth effectively. We have expanded our overall Contract Mining business, operations and headcount in recent periods.
Future royalty-based income is dependent on the number of oil and gas wells being developed and operated on our mineral acreage.
We primarily derive income from royalty-based leases under which lessees make payments to us based on their sale of natural gas, oil and coal. Future royalty-based income is dependent on the number of oil and gas wells being developed and operated on our mineral acreage.
Furthermore, our ability to forecast results may be hindered or inaccurate and the projects may not perform as predicted. Even if these projects are profitable in the long term, they may not be profitable in the short term, and results of operations are unlikely to be even quarter over quarter.
Furthermore, our ability to forecast results may be hindered or inaccurate and the projects may not perform as predicted.
A prolonged economic downturn or adverse change in regulatory conditions in the Florida mining or construction industry could result in a significant reduction in demand for NAMining’s services. The occurr ence of one or more natural disasters, severe weather events, terrorist attacks, or disruptive political events in Florida could adversely affect the NAMining business.
A prolonged economic downturn or adverse change in regulatory conditions in the Florida mining or construction industry could result in a significant reduction in demand for our services.
The Minerals Management segment does not currently have any material investments under which it would be required to bear the cost of exploration, production or development. We primarily derive income from royalty-based leases under which lessees make payments to us based on their sale of natural gas, oil and coal.
We own mineral and royalty interests in the continental United States. The Minerals and Royalties segment does not currently have any material investments under which it would be required to bear the cost of exploration, production or development.
As such, increased costs or decreased revenues could materially reduce our profitability. Profitability at MLMC is affected by customer demand for coal and changes in the indices that determine sales price and actual costs incurred. MLMC sells lignite at contractually agreed upon prices which are subject to changes in the level of established 19 Table of Contents indices over time.
Profitability at MLMC is affected by customer demand for coal, changes in the contractually determined sales price and actual costs incurred. The MLMC contract is the only coal supply contract in which we are responsible for all operating costs, capital requirements and final mine reclamation. As such, increased costs or decreased revenues could materially reduce our profitability.
Although we have long-term contracts, numerous regulatory authorities, along with well-funded political and environmental activist groups, are devoting substantial resources to anti-coal activities to minimize or eliminate the use of coal as a source of electricity generation. Any customer's premature facility closure or contract default could have a material adverse effect on our business, financial condition and results of operations.
Substantially all of the Utility Coal Mining segment's profits are derived from long-term mining contracts. Although we have long-term contracts, any customer's premature facility closure or contract default could have a material adverse effect on our business, financial condition and results of operations.
Any of these risks could result in a decrease in coal consumption by our customers and could have a material adverse effect on our business, financial condition and results of operations. We are subject to burdensome federal and state mining regulations and the assumptions underlying our reclamation and mine closure obligations could be materially inaccurate.
Changes in the utility industry that affect NACCO's customers could also adversely affect us. Any of these risks could result in a decrease in coal consumption by our customers and could have a material adverse effect on our business, financial condition and results of operations.
A decrease in coal consumption could have a material adverse effect on the Coal Mining segment's financial condition, results of operations and cash flows. We face numerous uncertainties in estimating economically recoverable reserves and resources, and inaccuracies in estimates could result in lower than expected revenues, higher than expected costs and decreased profitability.
We face numerous uncertainties in estimating economically recoverable reserves and resources, and inaccuracies in estimates could result in lower than expected revenues, higher than expected costs and decreased profitability. Information concerning our mining operations in Item 2 - Properties on page 25 has been prepared in accordance with the requirements of subpart 1300 of Regulation S-K.
Risks related to the Minerals Management segment We have no control over the timing of the development and operation of our natural gas, oil and coal reserves extracted by third parties. We own mineral and royalty interests in the continental United States.
The occurr ence of one or more natural disasters, severe weather events, terrorist attacks, or disruptive political events in Florida could adversely affect the Contract Mining business. 18 Table of Contents Risks related to the Minerals and Royalties segment We have no control over the timing of the development and operation of our natural gas, oil and coal reserves extracted by third parties.
Forecasts of NACCO's future performance are based on, among other things, estimates of mineral reserves and resources.
A mineral is economically recoverable when the price at which it can be sold exceeds the costs and expenses of mining, processing and selling the mineral. Forecasts of NACCO's future performance are based on, among other things, estimates of mineral reserves and resources.
Lower commodity prices may reduce the amount of oil and natural gas that third-party operators can produce economically.
Lower commodity prices and/or increased costs may reduce the amount of oil and natural gas that third-party operators can produce economically. In addition, if a lessee were to experience financial difficulty, the lessee might not be able to pay our royalty payments or continue operations.
Cyber threats and cyber attackers can be sponsored by nation states or sophisticated criminal organizations or be the work of independent hackers. As cyber threats evolve and become more difficult to detect and successfully defend against, one or more cyber attacks might defeat our, or a third-party service provider's, security measures in the future.
Cyber threats and cyber attackers can be sponsored by nation states or sophisticated criminal organizations or be the work of independent hackers. The rapid evolution and increased availability of artificial intelligence (AI) may intensify cybersecurity risks by making cyber-attacks more sophisticated and cybersecurity incidents more difficult to detect, contain and mitigate.
Removed
Risks related to the Coal Mining segment Termination of or default under long-term mining contracts could adversely affect our business, financial condition, results of operation and cash flows. Substantially all of the Coal Mining segment's profits are derived from long-term mining contracts.
Added
As a significant portion of MLMC’s costs are fixed, reduction in dispatch and/or reduced mechanical availability of the Red Hills Power Plant can and historically has materially reduced operating results at MLMC. Conversely, periods of higher dispatch can improve results.
Removed
Enactment of laws and passage of regulations regarding GHG emissions at the federal or state level, or other actions to limit carbon dioxide emissions, such as opposition by environmental groups of coal-fired power plants, could result in electric generators switching from coal to other fuel sources or premature facility closures.
Added
In February 2026, MLMC received notice from its customer that the Red Hills Power Plant experienced an unplanned outage, which is expected to lead to reduced demand and an anticipated operating loss for MLMC during 2026.
Removed
Congress continues to consider a variety of proposals to reduce GHG emissions from the combustion of coal and other fuels. These proposals include emission taxes, emission reductions, including carbon tax and cap-and-trade programs, and mandates or incentives to generate electricity by using renewable energy sources, such as wind or solar power. Some states have established programs to reduce GHG emissions.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

6 edited+1 added−1 removed8 unchanged
Biggest changeIn 2024, our Board and the Audit Review Committee received periodic updates throughout the year on cybersecurity matters and these updates are part of their standing agendas. Our Chief Information Security Officer (CISO) leads NACCO's cybersecurity program and is responsible for the management of our cybersecurity risks.
Biggest changeThis process includes reviewing the state of our cybersecurity program, discussing emerging cybersecurity developments, including AI, and monitoring the steps that management has taken to mitigate such exposure. In 2025, our Board and the Audit Review Committee received periodic updates throughout the year on cybersecurity matters and these updates are part of their standing agendas.
Our full Board regularly reviews information provided by management to oversee risk identification, risk management and risk mitigation strategies. The Audit Review Committee assists the Board with cybersecurity risk oversight.
Our full Board regularly reviews information provided by management to oversee risk identification, risk management and risk mitigation strategies. The Audit Review Committee assists the Board with cybersecurity risk oversight. The Audit Review Committee is responsible for regularly reviewing and discussing with management risk exposure relating to cybersecurity.
The CISO is informed of cybersecurity incidents by the cybersecurity team, which is generally responsible for monitoring the prevention, detection, mitigation, and remediation of cybersecurity incidents. We have an established process governing our assessment, response and internal and external notifications upon the occurrence of a cybersecurity incident, including evaluation of the potential impacts of cybersecurity incidents to determine materiality.
We have an established process governing our assessment, response and internal and external notifications upon the occurrence of a cybersecurity incident, including evaluation of the potential impacts of cybersecurity incidents to determine materiality.
Additionally, the CISO successfully completed an Executive course through Northwestern’s Kellogg School of Management focused on artificial intelligence during 2024. The CISO reports directly to the President and Chief Executive Officer. The CISO manages a team of internal and external resources that have expertise and experience in cybersecurity.
The CISO holds a bachelor’s degree in engineering, an executive MBA, and certifications in cybersecurity from Harvard. Additionally, the CISO successfully completed an Executive course through Northwestern’s Kellogg School of Management focused on artificial intelligence during 2024. The CISO reports directly to the President and Chief Executive Officer.
The CISO has extensive cybersecurity knowledge and skills gained from over 30 years of technical and business experience, including as General Manager & President of MLMC, Vice President of Mississippi Operations and Vice President of Innovation & Technology. The CISO holds a bachelor’s degree in engineering, an executive MBA, and certifications in cybersecurity from Harvard.
Our Chief Information Security Officer (CISO) leads NACCO's cybersecurity program and is responsible for the management of our cybersecurity risks. The CISO has extensive cybersecurity knowledge and skills gained from over 30 years of technical and business experience, including as General Manager & President of MLMC, Vice President of Mississippi Operations and Vice President of Innovation & Technology.
For additional information regarding our cybersecurity risks, please refer to Item 1A - Risk Factors on page 18. 28 Table of Contents
We recognize the constantly evolving nature of cyber threats and are committed to cultivating a strong security culture, maintaining vigilance and continuously enhancing our cybersecurity systems and controls. For additional information regarding our cybersecurity risks, please refer to Item 1A - Risk Factors on page 15 . 24 Table of Contents
Removed
The Audit Review Committee is responsible for regularly reviewing and discussing with management risk exposure relating to cybersecurity, which includes reviewing the state of our cybersecurity program and emerging cybersecurity developments and threats, as well as the steps management has taken to monitor and mitigate such exposure.
Added
The CISO manages a team of internal and external resources that have expertise and experience in cybersecurity. The CISO is informed of cybersecurity incidents by the cybersecurity team, which is generally responsible for monitoring the prevention, detection, mitigation, and remediation of cybersecurity incidents.

Item 2. Properties

Properties — owned and leased real estate

82 edited+5 added−7 removed115 unchanged
Biggest changeThe mine started delivering coal in 1983. All production from the mine is delivered to Dakota Coal Company, a wholly owned subsidiary of Basin Electric. Dakota Coal Company then sells the coal to the Synfuels Plant, Antelope Valley Station and Leland Olds Station, all of which are operated by affiliates of Basin Electric.
Biggest changeCoteau The Freedom Mine, operated by Coteau, generally produces between 11.0 million and 13.0 million tons of lignite coal annually. The mine started delivering coal in 1983. All production from the mine is delivered to Dakota Coal Company, a wholly owned subsidiary of Basin Electric.
The facilities and equipment are maintained to allow for safe and efficient operation. The equipment is well maintained, in good physical condition and is either updated or replaced periodically with newer models or upgrades available to keep up with modern technology.
The facilities and equipment are maintained to allow for safe and efficient operation. The equipment is well maintained, in good physical condition and is either updated or replaced periodically with newer models or upgrades available to keep up with modern technology.
Lignite Coal Resource Classification Tonnage ( Kt) Grades/Qualities Calorific Value (Btu/lb) Moisture (%wt) Ash (%wt) Sulfur (%wt) Mississippi Lignite Mining Company Measured 4,400 5,200 44.6 13.0 0.6 Mississippi Lignite Mining Company Indicated 400 5,180 44.1 13.6 0.6 Mississippi Lignite Mining Company Measured + Indicated 4,700 5,200 44.5 13.0 0.6 Mississippi Lignite Mining Company Inferred 100 5,200 45.5 12.0 0.5 Note: – Mineral Resources estimates have been prepared by a qualified person employed by NACCO Natural Resources as of December 31, 2024. – Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability and there is no certainty that all or any part of such Mineral Resources will be converted into Mineral Reserves. – Mineral Resources are in-situ and exclusive of 22.9 million tons (Mt) of Mineral Reserves. – Mineral Resources are reported using an economic cutoff of $34.02 per ton. – Resources are presented with a minimum 1 foot seam thickness, a maximum as received moisture basis ash content of 30%, and a minimum calorific value of 4000 BTU/lb on an as received moisture basis cutoff. – Resources are estimated using Vulcan Software. – Tonnages and qualities have been rounded to an accuracy level deemed appropriate by the QP.
Lignite Coal Resource Classification Tonnage ( Kt) Grades/Qualities Calorific Value (Btu/lb) Moisture (%wt) Ash (%wt) Sulfur (%wt) Mississippi Lignite Mining Company Measured 4,400 5,200 44.6 13.0 0.6 Mississippi Lignite Mining Company Indicated 400 5,180 44.1 13.6 0.6 Mississippi Lignite Mining Company Measured + Indicated 4,700 5,200 44.5 13.0 0.6 Mississippi Lignite Mining Company Inferred 100 5,200 45.5 12.0 0.5 Note: – Mineral Resources estimates have been prepared by a qualified person (QP) employed by NACCO Natural Resources. – Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability and there is no certainty that all or any part of such Mineral Resources will be converted into Mineral Reserves. – Mineral Resources are in-situ and exclusive of 22.9 million tons (Mt) of Mineral Reserves. – Mineral Resources are reported using an economic cutoff of $34.02 per ton. – Resources are presented with a minimum 1 foot seam thickness, a maximum as received moisture basis ash content of 30%, and a minimum calorific value of 4000 BTU/lb on an as received moisture basis cutoff. – Resources are estimated using Vulcan Software. – Tonnages and qualities have been rounded to an accuracy level deemed appropriate by the QP.
Item 2. PROPERTIES Coal Mining Segment - Operations NACCO-owned Properties 1.0 INTRODUCTION Information concerning our mining properties in this Form 10-K have been prepared in accordance with the requirements of subpart 1300 of Regulation S-K.
Item 2. PROPERTIES Utility Coal Mining Segment - Operations NACCO-owned Properties 1.0 INTRODUCTION Information concerning our mining properties in this Form 10-K have been prepared in accordance with the requirements of subpart 1300 of Regulation S-K.
In addition, Coyote Creek Mine owns in fee 160 acres of surface interests and has four easements to conduct coal mining operations on approximately 352 acres. 39 Table of Contents Figure 2.4 – Coyote Creek Mine Location The towns of Beulah, Hazen, and Stanton along with other smaller communities are within a 40-mile radius of the Coyote Creek Mine and provide a vast supply and employment base.
In addition, Coyote Creek Mine owns in fee 160 acres of surface interests and has four easements to conduct coal mining operations on approximately 352 acres. 35 Table of Contents Figure 2.4 – Coyote Creek Mine Location The towns of Beulah, Hazen, and Stanton along with other smaller communities are within a 40-mile radius of the Coyote Creek Mine and provide a vast supply and employment base.
North Dakota’s freight rail service is largely provided by Burlington Northern Santa Fe Railway and Canadian Pacific Railway. 40 Table of Contents The coal tonnages are located in Mercer County, North Dakota, starting approximately six miles southwest of Beulah, North Dakota. The formations of sedimentary origin were deposited in the Williston Basin, the dominant structural feature of western North Dakota.
North Dakota’s freight rail service is largely provided by Burlington Northern Santa Fe Railway and Canadian Pacific Railway. 36 Table of Contents The coal tonnages are located in Mercer County, North Dakota, starting approximately six miles southwest of Beulah, North Dakota. The formations of sedimentary origin were deposited in the Williston Basin, the dominant structural feature of western North Dakota.
Haas & Cobb does not own an interest in NACCO or any of our properties, nor is it employed on a contingent basis. A copy of Haas & Cobb's estimated proved reserve report as of December 31, 2024 is incorporated by reference herein to Exhibit 99.1 to this Form 10-K.
Haas & Cobb does not own an interest in NACCO or any of our properties, nor is it employed on a contingent basis. A copy of Haas & Cobb's estimated proved reserve report as of December 31, 2025 is incorporated by reference herein to Exhibit 99.1 to this Form 10-K.
Reserve engineering is a subjective process of estimating volumes of economically recoverable oil and natural gas that cannot be measured in an exact manner. The accuracy of any reserve estimate is a function of the quality of available data and of 45 Table of Contents engineering and geological interpretation. As a result, the estimates of different engineers often vary.
Reserve engineering is a subjective process of estimating volumes of economically recoverable oil and natural gas that cannot be measured in an exact manner. The accuracy of any reserve estimate is a function of the quality of available data and of 41 Table of Contents engineering and geological interpretation. As a result, the estimates of different engineers often vary.
Travel to the Freedom Mine by air is possible by means of the Bismarck Municipal Airport, Bismarck, ND, which is approximately 90 miles southeast of the mine.
Location of the Freedom Mine. Travel to the Freedom Mine by air is possible by means of the Bismarck Municipal Airport, Bismarck, ND, which is approximately 90 miles southeast of the mine.
The Mineral Resources as of December 31, 2024 presented in Table 2.2 below have been estimated by applying a series of geologic and physical limits as well as high-level mining and economic constraints. The mining and economic constraints were limited to a level sufficient to support reasonable prospect for future economic extraction of the estimated Mineral Resources.
The Mineral Resources as of December 31, 2025 presented in Table 2.2 below have been estimated by applying a series of geologic and physical limits as well as high-level mining and economic constraints. The mining and economic constraints were limited to a level sufficient to support reasonable prospect for future economic extraction of the estimated Mineral Resources.
(4) As an owner of mineral and royalty interests, our access to information concerning activity and operations of our royalty and mineral interests is limited. As a result, we estimated the last two months of 2024 and 2023 production and pricing data using projections based on decline rates of wells and prior expense information.
(4) As an owner of mineral and royalty interests, our access to information concerning activity and operations of our royalty and mineral interests is limited. As a result, we estimated the last two months of 2025 and 2024 production and pricing data using projections based on decline rates of wells and prior expense information.
Profitability at MLMC is affected by customer demand for coal and changes in the indices that determine sales price and actual costs incurred. 30 Table of Contents A summary of coal production at MLMC for the past three years has been tabulated and is presented on Table 2.1 Production Summary.
Profitability at MLMC is affected by customer demand for coal and changes in the indices that determine sales price and actual costs incurred. 26 Table of Contents A summary of coal production at MLMC for the past three years has been tabulated and is presented on Table 2.1 Production Summary.
No NOVs have been issued at the Freedom Mine in the past three years. Coteau currently has all permits in place for the Freedom Mine to operate through 2031. Permit expansions required to extend the life of the mine through 2045 will be acquired as needed. No mineral processing occurs at the Freedom Mine.
No NOVs have been issued at the Freedom Mine in the past three years. Coteau currently has all permits in place for the Freedom Mine to operate through 2031. Permit expansions required to extend the life of the mine through 2042 will be acquired as needed. No mineral processing occurs at the Freedom Mine.
Internal technical team members met with independent reserve engineers periodically during the period covered by the reserves report to discuss the assumptions and methods used in the proved reserve estimation process. 46 Table of Contents The preparation of our proved reserve estimates is completed in accordance with internal control procedures.
Internal technical team members met with independent reserve engineers periodically during the period covered by the reserves report to discuss the assumptions and methods used in the proved reserve estimation process. 42 Table of Contents The preparation of our proved reserve estimates is completed in accordance with internal control procedures.
Evaluation and Review of Reserves The reserve estimates as of December 31, 2024 were prepared by Haas & Cobb Petroleum Consultants (Haas & Cobb). Haas & Cobb is an independent, third-party, petroleum engineering firm that meets industry-standards for qualifications, independence, objectivity and confidentiality.
Evaluation and Review of Reserves The reserve estimates as of December 31, 2025 were prepared by Haas & Cobb Petroleum Consultants (Haas & Cobb). Haas & Cobb is an independent, third-party, petroleum engineering firm that meets industry-standards for qualifications, independence, objectivity and confidentiality.
The primary technical person, Franklin Stagg, responsible for preparing the Reserve Report, Licensed Professional Engineer in the State of Texas, has been practicing consulting petroleum engineering at Haas & Cobb since 2016 and has over 9 years of industry experience.
The primary technical person, Franklin Stagg, responsible for preparing the Reserve Report, Licensed Professional Engineer in the State of Texas, has been practicing consulting petroleum engineering at Haas & Cobb since 2016 and has over 10 years of industry experience.
Likewise, readers are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be converted to mineral reserves. See Item 1A - Risk Factors on page 18.
Likewise, readers are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be converted to mineral reserves. See Item 1A - Risk Factors on page 15 .
Tons (in millions) 2022 2023 2024 Mississippi Lignite Mining Company 3.2 2.7 1.9 Table 2.1 Production Summary The Red Hills Mine generally produces between 2 million and 3 million tons of lignite coal annually.
Tons (in millions) 2023 2024 2025 Mississippi Lignite Mining Company 2.7 1.9 2.7 Table 2.1 Production Summary The Red Hills Mine generally produces between 2 million and 3 million tons of lignite coal annually.
No mineral processing occurs at the Falkirk Mine. 38 Table of Contents Figure 2.3 – Falkirk Mine Location Coyote Creek The Coyote Creek Mine generally produces between 1.5 million and 2.0 million tons of lignite annually.
No mineral processing occurs at the Falkirk Mine. 34 Table of Contents Figure 2.3 – Falkirk Mine Location Coyote Creek The Coyote Creek Mine generally produces between 1.5 million and 2.0 million tons of lignite annually.
The Minerals Management Segment’s Vice President of Engineering and Finance is the technical person primarily responsible for overseeing the preparation of the internal reserve estimates and for coordinating with Haas & Cobb in the preparation of the third-party reserve report.
The Minerals and Royalties Segment’s Vice President of Engineering and Finance is the technical person primarily responsible for overseeing the preparation of the internal reserve estimates and for coordinating with Haas & Cobb in the preparation of the third-party reserve report.
MLMC currently has all permits in place for the Red Hills Mine to operate and adhere to a mine plan projected through April 1, 2032. No mineral processing occurs at the Red Hills Mine. 31 Table of Contents The geology encountered at the Red Hills Mine is stratigraphic in nature with depositional sequences of sands, silts, clays, and lignite.
MLMC currently has all permits in place for the Red Hills Mine to operate and adhere to a mine plan projected through April 1, 2032. No mineral processing occurs at the Red Hills Mine. The geology encountered at the Red Hills Mine is stratigraphic in nature with depositional sequences of sands, silts, clays, and lignite.
Summation errors due to rounding may exist. Table 2.3 Mineral Reserves Summary as of December 31, 2024 Table 2.4 describes the difference between the Mineral Reserves and Mineral Resources reported as of December 31, 2023 and December 31, 2024.
Summation errors due to rounding may exist. Table 2.3 Mineral Reserves Summary as of December 31, 2025 Table 2.4 describes the difference between the Mineral Reserves and Mineral Resources reported as of December 31, 2024 and December 31, 2025.
All production from Sabine was delivered to Southwestern Electric Power Company's (SWEPCO) Henry W. Pirkey Plant (the Pirkey Plant). SWEPCO is an American Electric Power (AEP) company. As a result of the early retirement of the Pirkey Plant, Sabine ceased deliveries in the first quarter of 2023 and commenced final reclamation on April 1, 2023.
All production from Sabine was delivered to Southwestern Electric Power Company's (SWEPCO) Henry W. Pirkey Plant (the Pirkey Plant). SWEPCO is an American Electric Power (AEP) company. As a result of the early retirement of the Pirkey Plant, Sabine ceased deliveries and commenced final reclamation on April 1, 2023.
Tons (in millions) 2022 2023 2024 The Coteau Properties Company 13.4 11.4 11.9 The Falkirk Mining Company 7.6 6.6 7.5 Coyote Creek Mining Company 1.8 2.2 1.9 Mississippi Lignite Mining Company 3.2 2.7 1.9 Totals 26.0 22.9 23.2 Table 1.1 Production Summary 2.0 MINING PROPERTIES SUBJECT TO SUBPART 1300 OF REGULATION S-K REPORTING 2.1 Red Hills Mine — Mississippi Lignite Mining Company MLMC is the owner and operator of the Red Hills Mine.
Tons (in millions) 2023 2024 2025 The Coteau Properties Company 11.4 11.9 11.3 The Falkirk Mining Company 6.6 7.5 7.3 Coyote Creek Mining Company 2.2 1.9 1.8 Mississippi Lignite Mining Company 2.7 1.9 2.7 Totals 22.9 23.2 23.1 Table 1.1 Production Summary 2.0 MINING PROPERTIES SUBJECT TO SUBPART 1300 OF REGULATION S-K REPORTING 2.1 Red Hills Mine — Mississippi Lignite Mining Company MLMC is the owner and operator of the Red Hills Mine.
As an owner of mineral and royalty interests, we generally do not have evidence or approval of operators’ development plans. As a result, proved undeveloped reserve estimates are limited to those relatively few locations for which drilling permits have been publicly filed. As of December 31, 2024, PUD reserves consists of 89 wells in various stages of drilling or completions.
As an owner of mineral and royalty interests, we generally do not have evidence or approval of operators’ development plans. As a result, proved undeveloped reserve estimates are limited to those relatively few locations for which drilling permits have been publicly filed. As of December 31, 2025, PUD reserves consists of 126 wells in various stages of drilling or completions.
No other market exists for the lignite at Coteau, Coyote Creek and Falkirk as the cost of transportation makes sales to any entity other than the current mine-mouth operator unprofitable. 35 Table of Contents Coteau, Coyote Creek and Falkirk meet the definition of a VIE.
No other market exists for the lignite at Coteau, Coyote Creek and Falkirk as the cost of transportation makes sales to any entity other than the current mine-mouth operator unprofitable. Coteau, Coyote Creek and Falkirk meet the definition of a VIE.
The total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2024 is $58.7 million. The Falkirk Mine currently has no significant encumbrances to the property. No Notice of Violations (NOVs) have been issued at the Falkirk Mine in the past three years.
The total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2025 is $70.7 million. The Falkirk Mine currently has no significant encumbrances to the property. No Notice of Violations (NOVs) have been issued at the Falkirk Mine in the past three years.
Summation errors due to rounding may exist. 33 Table of Contents Table 2.2 Mineral Resources Summary as of December 31, 2024 The Mineral Reserves as of December 31, 2024 presented in Table 2.3 below were determined to be the economically mineable portion of the measured and indicated Mineral Resources after the consideration of modifying factors related to the mining process.
Summation errors due to rounding may exist. Table 2.2 Mineral Resources Summary as of December 31, 2025 The Mineral Reserves as of December 31, 2025 presented in Table 2.3 below were determined to be the economically mineable portion of the measured and indicated Mineral Resources after the consideration of modifying factors related to the mining process.
Primary removal of burden is achieved with one 82-cubic yard electric-powered dragline, four large track-type push dozers, and a truck and shovel fleet utilizing a 41-cubic yard electric rope shovel.
Primary removal of burden is achieved with one 82-cubic yard electric-powered 27 Table of Contents dragline, four large track-type push dozers, and a truck and shovel fleet utilizing a 41-cubic yard electric rope shovel.
Locations of the properties subject to SEC Section 1300 reporting are shown in Figure 1.1 Surface Coal Mines Operational During 2024 Subject to SEC Section 1300 Reporting. 29 Table of Contents Figure 1.1 Surface Coal Mines Operational During 2024 Subject to SEC Section 1300 Reporting A summary of coal production at the Mines subject to SEC Section 1300 Reporting for the past three years has been tabulated and is presented on Table 1.1 Production Summary.
Locations of the properties subject to SEC Section 1300 reporting are shown in Figure 1.1 Surface Coal Mines Operational During 2025 Subject to SEC Section 1300 Reporting. 25 Table of Contents Figure 1.1 Surface Coal Mines Operational During 2025 Subject to SEC Section 1300 Reporting A summary of coal production at the Mines subject to SEC Section 1300 Reporting for the past three years has been tabulated and is presented on Table 1.1 Production Summary.
Ongoing quality validation of production also provides a means to monitor for 41 Table of Contents any potential changes in quality.
Ongoing quality validation of production also provides a means to monitor for 37 Table of Contents any potential changes in quality.
Additionally, MLMC delivered 1.9 million tons during 2024. 2.2 Material Properties with no Mineral Resources or Mineral Reserves The lignite coal tonnages at Coteau, Falkirk and Coyote Creek have not been classified as measured resources, indicated resources, or inferred resources as defined in Items 1300 through 1305 of Regulation S-K, and as a result, do not have any proven or probable reserves under such definition and are therefore classified as an Exploration Stage Property pursuant to Items 1300 through 1305 of Regulation S-K.
Additionally, MLMC delivered 2.7 million tons during 2025. 30 Table of Contents 2.2 Material Properties with no Mineral Resources or Mineral Reserves The lignite coal tonnages at Coteau, Falkirk and Coyote Creek have not been classified as measured resources, indicated resources, or inferred resources as defined in Items 1300 through 1305 of Regulation S-K, and as a result, do not have any proven or probable reserves under such definition and are therefore classified as an Exploration Stage Property pursuant to Items 1300 through 1305 of Regulation S-K.
As equipment wears out, Coteau evaluates what replacement option will be the most cost-efficient, including the evaluation of both new and used equipment. The total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2024 is $162.2 million. The Freedom Mine currently has no significant encumbrances to the property.
As equipment wears out, Coteau evaluates what replacement option will be the most cost-efficient, including the evaluation of both new and used equipment. The total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2025 is $195.5 million. The Freedom Mine currently has no significant encumbrances to the property.
The following mines were operational during 2024: Location Name Aggregate Location State Customer Year NACCO Started Operations White Rock — North Limestone Miami FL WRQ 1995 Krome Limestone Miami FL Cemex 2003 Alico Limestone Ft.
The following locations were operational during 2025: Location Name Aggregate Location State Customer Year NACCO Started Operations White Rock — North Limestone Miami FL WRQ 1995 Krome Limestone Miami FL Cemex 2003 Alico Limestone Ft.
As of October 1, 2026, SWEPCO has an obligation to acquire all of the capital stock of Sabine and complete the remaining mine reclamation. 5.0 Facilities and Equipment The facilities and equipment for each of the coal mines are maintained to allow for safe and efficient operation.
As of October 1, 2026, SWEPCO is obligated to acquire all of the capital stock of Sabine and complete the remaining mine reclamation. 5.0 Facilities and Equipment The facilities and equipment for each of the coal mines are maintained to allow for safe and efficient operation.
The total cost of the property and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2024 is $52.5 million. The Red Hills Mine currently has no significant encumbrances to the property. No mining permit violations have been issued at the Red Hills Mine in the past ten years.
The total cost of the property and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2025 is $54.4 million. The Red Hills Mine currently has no significant encumbrances to the property. No mining permit violations have been issued at the Red Hills Mine in the past ten years.
As equipment wears out, Coyote Creek evaluates what replacement option will be the most cost-efficient, including the evaluation of both new and used equipment. The total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2024 is $105.9 million.
As equipment wears out, Coyote Creek evaluates what replacement option will be the most cost-efficient, including the evaluation of both new and used equipment. The total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2025 is $97.0 million.
Permitting requirements are discussed in Section 17.0 of the TRS. Figure 2.1 – Red Hills Mine Location 32 Table of Contents Mineral Resources and Reserves have been summarized from the December 31, 2024 TRS for MLMC. The Mineral Resources and Mineral Reserves as of December 31, 2024 are included as Table 2.2 and Table 2.3.
Permitting requirements are discussed in Section 17.0 of the TRS. Figure 2.1 – Red Hills Mine Location Mineral Resources and Reserves have been summarized from the December 31, 2024 TRS for MLMC and have been modified from mining depletion. The Mineral Resources and Mineral Reserves as of December 31, 2025 are included as Table 2.2 and Table 2.3.
The mining method and total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2024 is set forth in the chart below: Location Mining Method Total Historical Cost of Mine Property, Plant and Equipment, Net of Applicable Accumulated Amortization, Depreciation and Impairment Unconsolidated Mining Operations (in millions) Freedom Mine — The Coteau Properties Company Dragline operation with 3 draglines $ 162.2 Falkirk Mine — The Falkirk Mining Company Dragline operation with 4 draglines $ 58.7 Coyote Creek Mine — Coyote Creek Mining Company, LLC Dragline operation with 1 dragline $ 105.9 Consolidated Mining Operations Red Hills Mine — Mississippi Lignite Mining Company Dragline operation with 1 dragline $ 52.5 NAMining Segment - Operations NAMining provides contract mining services for independently owned mines and quarries, primarily operating and maintaining draglines at limestone quarries and utilizing other mining equipment at sand and gravel quarries.
The mining method and total cost of the property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment as of December 31, 2025 is set forth in the chart below: Location Mining Method Total Historical Cost of Mine Property, Plant and Equipment, Net of Applicable Accumulated Amortization, Depreciation and Impairment Unconsolidated Mining Operations (in millions) Freedom Mine — The Coteau Properties Company Dragline operation with 3 draglines $ 195.5 Falkirk Mine — The Falkirk Mining Company Dragline operation with 3 draglines $ 70.7 Coyote Creek Mine — Coyote Creek Mining Company, LLC Dragline operation with 1 dragline $ 97.0 Consolidated Mining Operations Red Hills Mine — Mississippi Lignite Mining Company Dragline operation with 1 dragline $ 54.4 Contract Mining Segment - Operations Contract Mining provides contract mining services for independently owned mines and quarries, primarily operating and maintaining draglines at limestone quarries and utilizing other mining equipment at sand and gravel quarries.
Access to the FEC mine is by means of a paved road from NW 118th Avenue. Access to the SCL mine is by means of a paved road from NW 137th Avenue. Access to the Central State Aggregates mine is by means of a paved road from Yonkers Boulevard.
Access to the SCL mine is by means of a paved road from NW 137th Avenue. Access to the Central State Aggregates mine is by means of a paved road from Yonkers Boulevard. Access to the Mid Coast Aggregates mine is by means of a paved road from State Road 50.
At December 31, 2024, NAMining had $72.7 million in property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment. 42 Table of Contents The mining process at the limestone mines involves excavating limestone from a water-filled quarry utilizing draglines. The excavated limestone is transported and processed by the customer.
At December 31, 2025, Contract Mining had $96.5 million in property, plant and equipment, net of applicable accumulated amortization, depreciation and impairment. 38 Table of Contents The mining process at the limestone mines involves excavating limestone from a water-filled quarry utilizing draglines. The excavated limestone is transported and processed by the customer.
Net royalty acres are calculated based on our ownership and royalty rate, normalized to a standard 1/8 th royalty lease, and assumes a 1/4 th royalty rate for unleased acres. 44 Table of Contents The following table includes our estimate of developed and undeveloped acreage based on the gross acres in a basin or region and includes mineral interests, NPRIs, and ORRIs: December 31, 2024 December 31, 2023 Developed Acreage Undeveloped Acreage Gross Acreage Developed Acreage Undeveloped Acreage Gross Acreage Appalachia 32,156 2,505 34,661 32,156 2,505 34,661 Gulf Coast 22,191 5,741 27,932 22,191 5,741 27,932 Permian 118,021 3,416 121,437 117,220 3,416 120,636 Rockies 7,696 5,537 13,233 326 — 326 Williston — 1,194 1,194 — 1,194 1,194 Total 180,064 18,393 198,457 171,893 12,856 184,749 Undeveloped acres are either unleased and open or are leased acres on which wells have not been drilled or completed to a point that would permit the production of commercial quantities of oil or natural gas, regardless of whether such acreage contains proved reserves.
Net royalty acres are calculated based on our ownership and royalty rate, normalized to a standard 1/8 th royalty lease, and assumes a 1/4 th royalty rate for unleased acres. 40 Table of Contents The following table includes our estimate of developed and undeveloped acreage based on the gross acres in a basin or region and includes mineral interests, NPRIs, and ORRIs: December 31, 2025 December 31, 2024 Developed Acreage Undeveloped Acreage Gross Acreage Developed Acreage Undeveloped Acreage Gross Acreage Appalachia 32,156 2,505 34,661 32,156 2,505 34,661 Gulf Coast 22,271 5,741 28,012 22,191 5,741 27,932 Permian 125,887 5,015 130,902 118,021 3,416 121,437 Rockies 7,696 5,537 13,233 7,696 5,537 13,233 Williston — 1,194 1,194 — 1,194 1,194 Total 188,010 19,992 208,002 180,064 18,393 198,457 Undeveloped acres are either unleased and open or are leased acres on which wells have not been drilled or completed to a point that would permit the production of commercial quantities of oil or natural gas, regardless of whether such acreage contains proved reserves.
The following table includes our estimate of acreage for oil and gas mineral interests, NPRIs, and ORRIs: December 31, 2024 December 31, 2023 Gross Acres Net Royalty Acres Gross Acres Net Royalty Acres Appalachia 34,661 36,199 34,661 36,199 Gulf Coast 27,932 20,105 27,932 20,105 Permian 121,437 4,568 120,636 4,556 Rockies 13,233 659 326 72 Williston 1,194 2,388 1,194 2,388 Total 198,457 63,919 184,749 63,320 We may own more than one type of interest in the same tract of land, but the overlap is not significant.
The following table includes our estimate of acreage for oil and gas mineral interests, NPRIs, and ORRIs: December 31, 2025 December 31, 2024 Gross Acres Net Royalty Acres Gross Acres Net Royalty Acres Appalachia 34,661 36,199 34,661 36,199 Gulf Coast 28,012 20,196 27,932 20,105 Permian 130,902 4,973 121,437 4,568 Rockies 13,233 659 13,233 659 Williston 1,194 2,388 1,194 2,388 Total 208,002 64,415 198,457 63,919 We may own more than one type of interest in the same tract of land, but the overlap is not significant.
MLMC holds leases granting the right to mine approximately 5,423 acres of coal interests and the right to utilize approximately 4,890 acres of surface interests. MLMC holds subleases under which it has the right to mine approximately 1,683 acres of coal interest.
MLMC holds leases granting the right to mine approximately 4,660 acres of coal interests and the right to utilize approximately 4,384 acres of surface interests. MLMC holds subleases under which it has the right to mine approximately 1,860 acres of coal interest.
Lignite Coal Reserve Classification Tonnage (Kt) Grades/Qualities Calorific Value (Btu/lb) Moisture (%wt) Ash (%wt) Sulfur (%wt) Mississippi Lignite Mining Company Proven 18,200 5,090 43.3 14.9 0.6 Mississippi Lignite Mining Company Probable 4,700 5,080 43.1 15.1 0.6 Mississippi Lignite Mining Company Total 22,900 5,090 43.3 14.9 0.6 Note: – Mineral Reserves Estimates have been prepared by a qualified person employed by MLMC as of December 31, 2024. – Mineral Reserves have been demonstrated to be economic based on a positive cash flow – Mineral Reserves are stated on a Run of Mine basis – An economic cutoff in the Life of Mine plan averaged $34.41 per ton and was used to demonstrate coal reserves – Recovery varies by coal seam and ranges from 67% to 100% – Mineral Reserves use an economic cut-off of a maximum cumulative stripping ratio of 14:1.
Inferred Mineral Resources were not considered for Mineral Reserves. 29 Table of Contents Lignite Coal Reserve Classification Tonnage (Kt) Grades/Qualities Calorific Value (Btu/lb) Moisture (%wt) Ash (%wt) Sulfur (%wt) Mississippi Lignite Mining Company Proven 15,700 5,120 43.3 14.7 0.6 Mississippi Lignite Mining Company Probable 4,700 5,080 42.9 15.4 0.6 Mississippi Lignite Mining Company Total 20,300 5,110 43.3 14.9 0.6 Note: – Mineral Reserves Estimates have been prepared by a QP employed by MLMC. – Mineral Reserves have been demonstrated to be economic based on a positive cash flow – Mineral Reserves are stated on a Run of Mine basis – An economic cutoff in the Life of Mine plan averaged $34.41 per ton and was used to demonstrate coal reserves – Recovery varies by coal seam and ranges from 67% to 100% – Mineral Reserves use an economic cut-off of a maximum cumulative stripping ratio of 14:1.
Substantially all of the leases held by Coteau were acquired in the early 1970s and have been replaced with new leases or have lease terms for a period sufficient to meet Coteau’s contractual production requirements.
In addition, Coteau owns in fee 33,888 acres of surface interests and 4,237 acres of coal interests. Substantially all of the leases held by Coteau were acquired in the early 1970s and have been replaced with new leases or have lease terms for a period sufficient to meet Coteau’s contractual production requirements.
Coal Mining and Minerals Management lease corporate headquarters office space in Plano, Texas. 47 Table of Contents NAMining leases office and warehouse space in Medley, Florida. Item 3. LEGAL PROCEEDINGS We are not a party to any material legal proceeding other than ordinary routine litigation incidental to our respective business.
Contract Mining leases office and warehouse space in Medley, Florida. 43 Table of Contents Item 3. LEGAL PROCEEDINGS We are not a party to any material legal proceeding other than ordinary routine litigation incidental to our respective business.
Myers FL Titan America 2017 Palm Beach Aggregates Limestone Loxahatchee FL Palm Beach Aggregates 2017 Perry Limestone Lamont FL Martin Marietta 2018 SDI Aggregates Limestone Florida City FL Martin Marietta 2018 Queenfield Sand and gravel King William County VA Holcim Group 2018 Newberry Limestone Alachua County FL Summit Materials/Quikrete 2019 Seven Diamonds Limestone Pasco County FL Summit Materials/Quikrete 2021 Little River Sand and gravel Ashdown AR Heidelberg Materials 2021 Rosser Sand and gravel Ennis TX Heidelberg Materials 2021 Brooksville Cement Plant Limestone Brooksville FL Cemex 2021 Ash Grove Limestone Louisville NE Ash Grove, A CRH Company 2022 MDL (a) Phosphate Polk County FL Mineral Development, LLC 2024 (a) The MDL quarry was idled during 2024.
Myers FL Titan America 2017 Palm Beach Aggregates Limestone Loxahatchee FL Palm Beach Aggregates 2017 Perry Limestone Lamont FL Martin Marietta 2018 SDI Aggregates Limestone Florida City FL Martin Marietta 2018 Newberry Limestone Alachua County FL Summit Materials/Quikrete 2019 Seven Diamonds Limestone Pasco County FL Summit Materials/Quikrete 2021 Little River Sand and gravel Ashdown AR Heidelberg Materials 2021 Rosser (a) Sand and gravel Ennis TX Heidelberg Materials 2021 Brooksville Cement Plant Limestone Brooksville FL Cemex 2021 Ash Grove Limestone Louisville NE Ash Grove, A CRH Company 2022 Fort Myers Quarry Sand and gravel Ft.
Access to the Mid Coast Aggregates mine is by means of a paved road from State Road 50. Access to the West Florida Aggregates mine is by means of a paved road from Cortez Boulevard. Access to the St. Catherine mine is by means of a paved road from County Road 673.
Access to the West Florida Aggregates mine is by means of a paved road from Cortez Boulevard. Access to the St. Catherine mine is by means of a paved road from County Road 673. Access to the Center Hill mine is by means of a paved road from West Kings Highway.
The main entrance to the Freedom Mine is accessed by traveling north of Beulah on Highway 49 for one mile, then north on County Road 21 for two miles, then west on County Road 26 for three miles, and then north on County Road 15 for two miles as shown on Figure 2.2. Location of the Freedom Mine.
The Freedom Mine has, or is currently constructing, all supporting infrastructure for mining operations. 32 Table of Contents The main entrance to the Freedom Mine is accessed by traveling north of Beulah on Highway 49 for one mile, then north on County Road 21 for two miles, then west on County Road 26 for three miles, and then north on County Road 15 for two miles as shown on Figure 2.2.
The following table sets forth our estimate of the number of gross and net productive wells: December 31, 2024 December 31, 2023 Gross Net Gross Net Oil 1,295 4.3 1,646 6.6 Natural Gas 922 18.5 246 13.5 Total 2,217 22.8 1,892 20.1 Gross wells are the total wells in which an interest is owned.
The following table sets forth our estimate of the number of gross and net productive wells: December 31, 2025 December 31, 2024 Gross Net Gross Net Oil 1,663 4.7 1,295 4.3 Natural Gas 851 19.2 922 18.5 Total 2,514 23.9 2,217 22.8 Gross wells are the total wells in which an interest is owned.
Access to the White Rock mine is by means of a paved road from 122nd Avenue. Access to the Krome mine is by means of a paved road from Krome Avenue. Access to the Alico mine is by means of a paved road from Alico Road.
Access to the Krome mine is by means of a paved road from Krome Avenue. Access to the Alico mine is by means of a paved road from Alico Road. Access to the FEC mine is by means of a paved road from NW 118th Avenue.
Production and Price History The following table sets forth the estimated oil and natural gas production data related to our mineral and royalty interests as well as certain price and cost information for the years ended December 31: 2024 (4) 2023 (4) Production data: Oil (bbl) (1) 149,529 98,553 NGL (bbl) (1) 65,053 56,768 Residue gas (Mcf) (2) 8,482,414 7,601,521 Total BOE (3) 1,628,318 1,422,241 Average realized prices: Oil (bbl) (1) $ 78.45 $ 72.19 NGL (bbl) (1) $ 22.94 $ 23.33 Residue gas (Mcf) (2) $ 2.08 $ 2.37 Average unit cost BOE (3) $ 2.79 $ 3.32 (1) Bbl.
Production and Price History The following table sets forth the estimated oil and natural gas production data related to our mineral and royalty interests as well as certain price and cost information for the years ended December 31: 2025 (4) 2024 (4) Production data: Oil (bbl) (1) 112,308 149,529 NGL (bbl) (1) 72,430 65,053 Residue gas (Mcf) (2) 7,957,946 8,482,414 Total BOE (3) 1,511,063 1,628,318 Average realized prices: Oil (bbl) (1) $ 64.51 $ 78.45 NGL (bbl) (1) $ 23.21 $ 22.94 Residue gas (Mcf) (2) $ 3.13 $ 2.08 Average unit cost BOE (3) $ 2.58 $ 2.79 (1) Bbl.
Resource Classification December 31, 2023 Tonnage (Kt) December 31, 2024 Tonnage (Kt) Percent Change Measured 4,300 4,400 2% Indicated 500 400 (20)% Measured + Indicated 4,800 4,700 (2)% Inferred 1,600 100 (94)% Reserve Classification December 31, 2023 Tonnage (Kt) December 31, 2024 Tonnage (Kt) Percent Change Proven 15,100 18,200 21% Probable 7,400 4,700 (36)% Proven + Probable 22,500 22,900 2% Table 2.4.
Resource Classification December 31, 2024 Tonnage (Kt) December 31, 2025 Tonnage (Kt) Percent Change Measured 4,400 4,400 —% Indicated 400 400 —% Measured + Indicated 4,700 4,700 —% Inferred 100 100 —% Reserve Classification December 31, 2024 Tonnage (Kt) December 31, 2025 Tonnage (Kt) Percent Change Proven 18,200 15,700 (14)% Probable 4,700 4,700 —% Proven + Probable 22,900 20,300 (11)% Table 2.4.
Access to the Little River mine is by means of an unpaved road from Little River 60. Access to the Rosser mine is by means of a paved road from TX-34 S. Access to Brooksville Cement plant is by means of a paved road from Cement Plant Road.
Access to the Seven Diamonds mine is by means of a paved road from US-41 S/Broad St. Access to the Little River mine is by means of an unpaved road from Little River 60. Access to Brooksville Cement plant is by means of a paved road from Cement Plant Road.
The Red Hills Mine started operations in 2000 for plant commissioning, with initial commercial deliveries starting in 2001, and full production and commercial deliveries starting in 2002. All production from the mine is delivered to MLMC's customer's Red Hills Power Plant.
The Red Hills Mine started operations in 2000 for plant commissioning, with initial commercial deliveries starting in 2001, and full production and commercial deliveries starting in 2002. All production from the mine is delivered to MLMC's customer's Red Hills Power Plant. The Red Hills Mine, operated by MLMC, is located approximately 120 miles northeast of Jackson, Mississippi (Figure 2.1).
The Red Hills Mine, operated by MLMC, is located approximately 120 miles northeast of Jackson, Mississippi (Figure 2.1). The entrance to the mine is by means of a paved road located approximately one mile west of Highway 9. MLMC owns in fee approximately 8,090 acres of surface interest and 5,150 acres of coal interests.
The entrance to the mine is by means of a paved road located approximately one mile west of Highway 9. MLMC owns in fee approximately 8,337 acres of surface interest and 5,436 acres of coal interests.
Fuel for equipment is supplied by multiple local vendors including: Farstad Oil, Missouri Valley Petroleum, and Enerbase Cooperative Resources. The main entrance to the Falkirk Mine is accessed by traveling north from Bismarck on State Highway 83 for approximately 50 miles, then going west on the access road, 1st Street SW located four miles south of Underwood.
The main entrance to the Falkirk Mine is accessed by traveling north from Bismarck on State Highway 83 for approximately 50 miles, then going west on the access road, 1st Street SW located four miles south of Underwood. The mine office is located two miles to the west.
Figure 2.2 – Freedom Mine Location The towns of Beulah, Hazen, and Stanton along with other smaller communities are within a 40-mile radius of the Freedom Mine and provide a vast supply of the employment base.
Figure 2.2 – Freedom Mine Location The towns of Beulah, Hazen, and Stanton along with other smaller communities are within a 40-mile radius of the Freedom Mine and provide a vast supply of the employment base. Employees also come from the cities of Bismarck, Minot, and Dickinson, all of which are less than 100 miles away from the mine.
Assumptions include a maximum cumulative stripping ratio of 18:1 based on an assumed lignite sales price of $34.02 per ton. A further description of the verified drilling data used to model the lignite deposit for estimation of Mineral Resources is provided in Section 7.2 Drilling Exploration, 8.0 Sample Preparation, Analyses, and Security, and Section 9.0 Data Verification.
A further description of the verified drilling data used to model the lignite deposit for estimation of Mineral Resources is provided in Section 7.2 Drilling Exploration, 8.0 Sample Preparation, Analyses, and Security, and Section 9.0 Data Verification.
As of December 31, 2024, less than 1% of our total proved reserves were classified as PUDs. Headquarter locations NACCO leases office space in Highland Hills, Ohio, a suburb of Cleveland, Ohio, which serves as our corporate headquarters.
As of December 31, 2025, approximately 2% of our total proved reserves were classified as PUDs. Headquarter locations NACCO leases office space in Highland Hills, Ohio, a suburb of Cleveland, Ohio, which serves as our corporate headquarters. Utility Coal Mining and Minerals and Royalties lease corporate headquarters office space in Plano, Texas.
At December 31, 2024, NAMining operated 31 draglines and other equipment at 23 quarries. Of the 31 draglines, 7 are owned by us and 24 are owned by customers.
At December 31, 2025, Contract Mining operated 34 draglines and other equipment at 23 quarries. Of the 34 draglines, 8 are owned by us and 26 are owned by customers.
Access to the Palm Beach Aggregates mine is by means of a paved road from State Road 80. 43 Table of Contents Access to the Perry mine is by means of paved road from Nutall Rise Road. Access to the SDI Aggregates mine is by means of paved road from SW 167 th AVE.
Access to the Perry mine is by means of paved road from Nutall Rise Road. Access to the SDI Aggregates mine is by means of paved road from SW 167 th AVE. Access to the Newberry mine is by means of paved road from NW County Road 235 (CR 235).
Access to the Center Hill mine is by means of a paved road from West Kings Highway. Access to the Inglis mine is by means of a paved road from Highway 19 South. Access to the Titan Corkscrew mine is by means of a paved road from Corkscrew Road.
Access to the Inglis mine is by means of a paved road from Highway 19 South. Access to the Titan Corkscrew mine is by means of a paved road from Corkscrew Road. 39 Table of Contents Access to the Palm Beach Aggregates mine is by means of a paved road from State Road 80.
The income before income taxes associated with these VIEs is reported as Earnings of unconsolidated operations on the Consolidated Statements of Operations, and our investment is reported on the line Investments in unconsolidated subsidiaries in the Consolidated Balance Sheets. Coteau The Freedom Mine, operated by Coteau, generally produces between 11.5 million and 13.5 million tons of lignite coal annually.
The income before income taxes 31 Table of Contents associated with these VIEs is reported as Earnings of unconsolidated operations on the Consolidated Statements of Operations, and our investment is reported on the line Investments in unconsolidated subsidiaries in the Consolidated Balance Sheets.
The mine office is located two miles to the west. Travel to the Falkirk Mine by air is possible using the Bismarck Airport in Bismarck, ND, approximately 55 miles south of the mine, and then using ground transportation, traveling via US Highway 83.
Travel to the Falkirk Mine by air is possible using the Bismarck Airport in Bismarck, ND, approximately 55 miles south of the mine, and then using ground transportation, traveling via US Highway 83. The main railway systems near the Falkirk Mine are Canadian Pacific, BNSF, and Dakota Missouri Valley & Western (DMVW). DMVW crosses through the Falkirk Mine Reserve.
The initial production period is expected to run through May 1, 37 Table of Contents 2032, but the coal sales agreement may be extended or terminated early under certain circumstances. In 2014, Falkirk began delivering coal to Spiritwood Station, another electric power generating station owned by GRE.
The initial production period is expected to run through May 1, 2032, but the coal sales agreement may be extended or terminated early under certain circumstances.
Structurally, the area is located on an intercratonic basin containing a thick sequence of sedimentary rocks. The economically mineable coal occurs in the Sentinel Butte Formation and the Bullion Creek Formation and are unconformably overlain by the Coleharbor Formation. The Sentinel Butte Formation conformably overlies the Bullion Creek Formation.
The economically mineable coal occurs in the Sentinel Butte Formation and the Bullion Creek Formation and are unconformably overlain by the Coleharbor Formation. The Sentinel Butte Formation conformably overlies the Bullion Creek Formation.
The towns of Underwood and Washburn are located within ten miles of the mine, with other small communities also nearby. Numerous employees also reside in Bismarck and Mandan, a distance of about 50 miles. The Falkirk Mine receives both power and water from Coal Creek Station. However, Falkirk’s East shift change building receives water from McLean-Sheridan Rural Water.
Numerous employees also reside in Bismarck and Mandan, a distance of about 50 miles. The Falkirk Mine receives both power and water from Coal Creek Station. However, Falkirk’s East shift change building receives water from McLean-Sheridan Rural Water. Fuel for equipment is supplied by multiple local vendors including: Farstad Oil, Missouri Valley Petroleum, and Enerbase Cooperative Resources.
Coteau holds 355 leases granting the right to extract approximately 32,748 acres of coal interests and the right to utilize approximately 22,771 acres of surface interests. In addition, Coteau owns in fee 33,888 acres of surface interests and 4,117 acres of coal interests.
Falkirk holds 341 leases granting the right to extract approximately 43,600 acres of coal interests and the right to utilize approximately 22,475 acres of surface interests. In addition, Falkirk owns in fee 40,722 acres of surface interests and 2,148 acres of coal interests.
NAMining mined de minimis amounts at this location during 2024. NAMining's customers control all of the limestone and sand reserves within their respective mines. NAMining has no title, claim, lease or option to acquire any of the reserves at any of the mines where it provides services.
Contract Mining's customers control all of the limestone and sand reserves within their respective mines. Contract Mining has no title, claim, lease or option to acquire any of the reserves at any of the mines where it provides services. Access to the White Rock mine is by means of a paved road from 122nd Avenue.
Access to Ash Grove Louisville Quarry is by means of a paved road from HWY 50. Access to MDL Quarry is by means of Noralyn Mine Road. Minerals Management - Operations As an owner of royalty and mineral interests, our access to information concerning activity and operations of our royalty and mineral interests is limited.
Minerals and Royalties - Operations As an owner of royalty and mineral interests, our access to information concerning activity and operations of our royalty and mineral interests is limited.
Coal qualities are reported on an as-received moisture basis. Based on the December 31, 2024 TRS, prices in Table 2.2 are based on economic cut-off grades of $34.02 per ton at MLMC and prices in Table 2.3 are based on economic cut-off grades of $34.40 per ton at MLMC.
Based on the December 31, 2024 TRS, prices in Table 2.2 are based on economic cut-off grades of $34.02 per ton at MLMC and prices in Table 2.3 are based on economic cut-off grades of $34.40 per ton at MLMC. 28 Table of Contents Material assumptions and criteria used in the determination of Mineral Resource and Mineral Reserves reported herein are provided within the filed TRS for the MLMC – Red Hills Mine dated December 31, 2024.
Net reserves as of December 31, 2024 Net reserves as of December 31, 2023 Oil (bbl) (1) NGL (bbl) (1) Residue gas (Mcf) (2) Oil (bbl) (1) NGL (bbl) (1) Residue gas (Mcf) (2) Proved developed 620,790 443,650 27,491,840 656,370 380,650 23,596,110 Proved undeveloped 74,400 30,280 135,830 9,020 3,720 26,420 Total 695,190 473,930 27,627,670 665,390 384,370 23,622,530 (1) Bbl.
Net reserves as of December 31, 2025 Net reserves as of December 31, 2024 Oil (bbl) (1) NGL (bbl) (1) Residue gas (Mcf) (2) Oil (bbl) (1) NGL (bbl) (1) Residue gas (Mcf) (2) Proved developed 590,134 567,276 27,255,664 620,790 443,650 27,491,840 Proved undeveloped 83,559 17,528 251,964 74,400 30,280 135,830 Total 673,693 584,804 27,507,628 695,190 473,930 27,627,670 (1) Bbl.
Net difference of reported Mineral Resources and Mineral Reserves from previous reporting period to current reporting period.
Net difference of reported Mineral Resources and Mineral Reserves from previous reporting period to current reporting period. The Mineral Resources and Mineral Reserves as of December 31, 2025 reflect modifications from mining extraction of Mineral Reserves. No updates to Mineral Resources were made for 2025.
In addition, Falkirk owns in fee 41,034 acres of surface interests and 1,788 acres of coal interests. Substantially all of the leases held by Falkirk were acquired in the early 1970s with initial terms that have been further extended by the continuation of mining operations.
Substantially all of the leases held by Falkirk were acquired in the early 1970s with initial terms that have been further extended by the continuation of mining operations. The towns of Underwood and Washburn are located within ten miles of the mine, with other small communities also nearby.
The Falkirk Mine, operated by Falkirk, is located approximately 50 miles north of Bismarck, North Dakota on a paved access road off U.S. Highway 83 (Figure 2.3). Falkirk holds 334 leases granting the right to extract approximately 43,015 acres of coal interests and the right to utilize approximately 22,964 acres of surface interests.
In 2014, Falkirk began delivering coal to Spiritwood Station, another electric power generating station owned by GRE. 33 Table of Contents The Falkirk Mine, operated by Falkirk, is located approximately 50 miles north of Bismarck, North Dakota on a paved access road off U.S. Highway 83 (Figure 2.3).
The Synfuels Plant is a coal gasification plant that manufactures synthetic natural gas and produces fertilizers, solvents, phenol, carbon dioxide, and other chemical products for sale. In March 2025, the term of the existing lignite sales agreement was extended until 2032. The term may be extended for an additional five year period, or until 2037, at the option of Coteau.
In March 2025, the term of the existing lignite sales agreement was extended until 2032. The term may be extended for an additional five year period, or until 2037, at the option of Coteau. The Freedom Mine is located approximately 90 miles northwest of Bismarck, North Dakota (Figure 2.2).
The Freedom Mine is located approximately 90 miles northwest of Bismarck, North Dakota (Figure 2.2). The main entrance to the Freedom Mine is accessed by means of a paved road and is located on County Road 15.
The main entrance to the Freedom Mine is accessed by means of a paved road and is located on County Road 15. Coteau holds 354 leases granting the right to extract approximately 33,451 acres of coal interests and the right to utilize approximately 23,085 acres of surface interests.
The main railway systems near the Falkirk Mine are Canadian Pacific, BNSF, and Dakota Missouri Valley & Western (DMVW). DMVW crosses through the Falkirk Mine Reserve. The coal tonnages are located in McLean County, North Dakota, from approximately nine miles northwest of the town of Washburn, North Dakota to four miles north of the town of Underwood, North Dakota.
The coal tonnages are located in McLean County, North Dakota, from approximately nine miles northwest of the town of Washburn, North Dakota to four miles north of the town of Underwood, North Dakota. Structurally, the area is located on an intercratonic basin containing a thick sequence of sedimentary rocks.

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Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. LEGAL PROCEEDINGS 48 Item 4. MINE SAFETY DISCLOSURES 48 PART II. Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 49 Item 6. [RESERVED] 49 Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 50
Biggest changeItem 3. LEGAL PROCEEDINGS 44 Item 4. MINE SAFETY DISCLOSURES 44 PART II. Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES 45 Item 6. [RESERVED] 45 Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 46

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. MINE SAFETY DISCLOSURES Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of The Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 filed with this Form 10-K. 48 Table of Contents PART II
Biggest changeItem 4. MINE SAFETY DISCLOSURES Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of The Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95 filed with this Form 10-K. 44 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers Issuer Purchases of Equity Securities (1) Period (a) Total Number of Shares Purchased (b) Average Price Paid per Share (c) Total Number of Shares Purchased as Part of the Publicly Announced Program (d) Maximum Number of Shares (or Approximate Dollar Value) that May Yet Be Purchased Under the Program (1) October 1 to 31, 2024 — $ — — $ 8,909,786 November 1 to 30, 2024 — $ — — $ 8,909,786 December 1 to 31, 2024 12,610 $ 29.20 12,610 $ 8,541,574 Total 12,610 $ 29.20 12,610 $ 8,541,574 (1) On November 7, 2023, our Board of Directors approved a stock purchase program providing for the purchase of up to $20.0 million of our outstanding Class A common stock through December 31, 2025.
Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers Issuer Purchases of Equity Securities (1) (2) Period (a) Total Number of Shares Purchased (b) Average Price Paid per Share (c) Total Number of Shares Purchased as Part of the Publicly Announced Program (d) Maximum Number of Shares (or Approximate Dollar Value) that May Yet Be Purchased Under the Program (1) October 1 to 31, 2025 — $ — — $ 7,846,258 November 1 to 30, 2025 — $ — — $ 20,000,000 December 1 to 31, 2025 39,356 $ 46.70 39,356 $ 18,162,075 Total 39,356 $ 46.70 39,356 $ 18,162,075 (1) On November 18, 2025, our Board of Directors approved a stock purchase program providing for the purchase of up to $20.0 million of our outstanding Class A common stock through December 31, 2027.
The Class B common stock is convertible into Class A common stock on a one-for-one basis. At December 31, 2024, there were 648 Class A common stockholders of record and 110 Class B common stockholders of record.
The Class B common stock is convertible into Class A common stock on a one-for-one basis. At December 31, 2025, there were 631 Class A common stockholders of record and 104 Class B common stockholders of record.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeMitigation Resources of North America ® (Mitigation Resources) provides stream and wetland mitigation solutions as well as comprehensive reclamation and restoration construction services. In addition, ReGen Resources is pursuing opportunities to develop new power generation resources. We have items not directly attributable to a reportable segment that are not included in the reported financial results of the operating segment.
Biggest changeThese businesses complement our existing operations and support our long-term growth strategic objectives. Mitigation Resources of North America ® (Mitigation Resources) provides natural resource restoration and reclamation services that include stream and wetland mitigation solutions. ReGen Resources is pursuing opportunities to develop new power generation resources. We also have items not directly attributable to an operating segment.
All financial statement line items below operating profit (loss) (other income, including interest expense and interest income, the provision (benefit) for income taxes and net income (loss)) are presented and discussed within this Form 10-K on a consolidated basis. See Item 1. Business beginning on page 1 in this Form 10-K for further discussion of NACCO's subsidiaries.
All financial statement line items below operating profit (other expense, including interest expense and interest income, the benefit for income taxes and net income) are presented and discussed within this Form 10-K on a consolidated basis. See Item 1. Business beginning on page 1 in this Form 10-K for further discussion of NACCO's subsidiaries.
Item 6. [RESERVED] 49 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Item 6. [RESERVED] 45 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
These items primarily include administrative costs related to public company reporting requirements, including management and board compensation, and the financial results of Bellaire Corporation (Bellaire), Mitigation Resources, ReGen Resources and other developing businesses. Bellaire manages our long-term liabilities related to former Eastern U.S. underground mining activities.
These items primarily include administrative costs related to public company reporting requirements, including management and board compensation, the financial results of developing businesses and Bellaire Corporation (Bellaire). Bellaire manages long-term liabilities related to former Eastern U.S. underground mining activities.
NACCO Natural Resources brings natural resources to life by delivering aggregates, minerals, reliable fuels and environmental solutions through our robust portfolio of businesses. We operate under three business segments: Coal Mining, North American Mining ® (NAMining) and Minerals Management. The Coal Mining segment operates surface coal mines for power generation companies.
NACCO Natural Resources brings natural resources to life by delivering aggregates, minerals, reliable fuels and environmental solutions through our robust portfolio of businesses. We operate under three reportable business segments: Utility Coal Mining, Contract Mining and Minerals and Royalties.
See Note 3 to the Consolidated Financial Statements in this Form 10-K for further discussion of our revenue recognition. Long-lived assets: We periodically evaluate long-lived assets for impairment when changes in circumstances or the occurrence of certain events indicate the carrying amount of an asset or asset group may not be recoverable.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) Long-lived assets: We periodically evaluate long-lived assets for impairment when changes in circumstances or the occurrence of certain events indicate the carrying amount of an asset or asset group may not be recoverable.
Upon identification of indicators of impairment, we evaluate the carrying value of the asset by comparing the estimated future 50 Table of Contents
Upon identification of indicators of impairment, we evaluate the carrying value of the asset by comparing the estimated future undiscounted cash flows generated from the use of the asset or asset group and its eventual disposition with the asset's net carrying value.
Removed
The NAMining segment is a trusted mining partner for producers of aggregates, activated carbon, lithium and other industrial minerals. The Minerals Management segment, which includes the Catapult Mineral Partners (Catapult) business, acquires and promotes the development of mineral interests.
Added
The Utility Coal Mining segment, operated by North American Coal ® , manages surface coal mines that are exclusive, long-term fuel providers for power generation companies. The Contract Mining segment, operated by North American Mining ® , is a leading provider of a broad range of specialized, long-term contract mining services.
Added
The Minerals and Royalties segment, which includes the Catapult Mineral Partners ® (Catapult) business, acquires and promotes the development of mineral and royalty interests and other related investments. In addition to the reportable segments discussed above, we also operate other businesses that are not currently reported as separate segments.
Added
See Note 3 to the Consolidated Financial Statements in this Form 10-K for further discussion of our revenue recognition. 46 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Added
If the carrying value of an asset is considered impaired, an impairment charge is recorded for the amount that the carrying value of the long-lived asset or asset group exceeds its fair value.
Added
Fair value is estimated as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Income taxes: We file income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions.
Added
Tax law requires certain items to be included in the tax return at different times than the items are reflected in the financial statements.
Added
Some of these differences are permanent, such as the benefit associated with percentage depletion (tax deductions for depletion that may exceed the tax basis in the mineral reserve) and expenses that are not deductible for tax purposes, and some differences are temporary, reversing over time, such as depreciation expense.
Added
These temporary differences create deferred tax assets and liabilities using currently enacted tax rates. The objective of accounting for income taxes is to recognize the amount of taxes payable or refundable for the current year, and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the financial statements or tax returns.
Added
The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the provision for income taxes in the period that includes the enactment date.
Added
Management is required to estimate the timing of the recognition of deferred tax assets and liabilities, make assumptions about the future deductibility of deferred tax assets and assess deferred tax liabilities based on enacted laws and tax rates for the appropriate tax jurisdictions to determine the amount of such deferred tax assets and liabilities.
Added
Changes in the calculated deferred tax assets and liabilities may occur in certain circumstances, including statutory income tax rate changes, statutory tax law changes, or changes in the structure or tax status. Our tax assets, liabilities, and tax expense are supported by historical earnings and losses and our best estimates and assumptions of future earnings.
Added
We assess whether a valuation allowance should be established against our deferred tax assets based on consideration of all available evidence, both positive and negative, using a more likely than not standard. This assessment considers, among other matters, scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations.
Added
The assumptions about future taxable income require significant judgment and are consistent with the plans and estimates we use to manage the underlying businesses. When we determine, based on all available evidence, that it is more likely than not that deferred tax assets will not be realized, a valuation allowance is established.
Added
Since significant judgment is required to assess the future tax consequences of events that have been recognized in our financial statements or tax returns, the ultimate resolution of these events could result in adjustments to our financial statements and such adjustments could be material.
Added
We believe the current assumptions, judgments and other considerations used to estimate the current year accrued and deferred tax positions are appropriate.
Added
If the actual outcome of future tax consequences differs from these estimates and assumptions, due to changes or future events, the resulting change to the provision for income taxes could have a material impact on our results of operations and financial position. Since 2021, we have participated in a voluntary program with the IRS called Compliance Assurance Process (CAP).
Added
The objective of CAP is to contemporaneously work with the IRS to achieve federal tax compliance and resolve all or most issues prior to the filing of the tax return. See Note 13 to the Consolidated Financial Statements in this Form 10-K for further discussion of our income taxes. 47 Table of Contents Item 7.
Added
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Added
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) CONSOLIDATED FINANCIAL SUMMARY Our results of operations were as follows for the years ended December 31: 2025 2024 Revenues: Utility Coal Mining $ 88,188 $ 68,611 Contract Mining 140,013 119,600 Minerals and Royalties 37,630 34,579 Unallocated Items 15,080 17,707 Eliminations (3,713) (2,789) Total revenue $ 277,198 $ 237,708 Operating profit (loss): Utility Coal Mining $ 17,155 $ 24,311 Contract Mining 5,767 5,772 Minerals and Royalties 29,108 28,927 Unallocated Items (29,962) (23,317) Eliminations (87) 12 Total operating profit $ 21,981 $ 35,705 Interest expense 5,754 5,566 Interest income (3,052) (4,428) Closed mine obligations 457 2,381 Loss (gain) on equity securities 726 (1,805) Gain on settlement of excess funding liability (3,590) — Pension settlement charge 7,804 — Other, net 738 345 Other expense, net 8,837 2,059 Income before income tax benefit 13,144 33,646 Income tax benefit (4,430) (95) Net income $ 17,574 $ 33,741 Effective income tax rate (33.7) % (0.3) % The components of the change in revenues and operating profit are discussed below in Segment Results.
Added
Other expense, net Interest expense increased modestly in 2025 compared with 2024 due to higher average borrowings, partially offset by an increase in capitalized interest and lower average interest rates. Interest income decreased in 2025 compared with 2024 due to lower earnings on reduced cash balances.
Added
Loss (gain) on equity securities represents changes in the market price of invested assets reported at fair value. The change during 2025 compared with 2024 was due to fluctuations in the market prices of the exchange-traded equity securities.
Added
See Note 9 to the Consolidated Financial Statements in this Form 10-K for further discussion of our invested assets reported at fair value . Closed mine obligations decreased in 2025 compared with 2024 due to a change in the estimate of future water treatment costs at Bellaire.
Added
See Note 7 to the Consolidated Financial Statements in this Form 10-K for further discussion of our asset retirement obligations. 48 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Added
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) During 2025, we terminated the NACCO Combined Defined Benefit Plan (Combined Plan) and settled all future obligations by transferring the remaining benefit obligations to a third-party insurance company. Although the plan was over funded, we recognized a $7.8 million non-cash Pension settlement charge.
Added
See Note 1 and Note 14 to the Consolidated Financial Statements in this Form 10-K for further information on the Combined Plan. During 2025, $14.5 million of excess funds from the terminated Falkirk Defined Benefit Plan were directly transferred to the NACCO 401(k) plan.
Added
The NACCO 401(k) plan is a qualified replacement plan; therefore, these funds will be utilized to offset future profit sharing contributions to eligible 401(k) plan participants. During 2025, NACCO and Falkirk’s former customer agreed to settle the corresponding liability for $10.9 million, resulting in a $3.6 million Gain on settlement of excess funding liability.
Added
See Note 1 to the Consolidated Financial Statements in this Form 10-K for further information on the excess funds.
Added
Income Taxes We recorded an income tax benefit of $4.4 million for the year ended December 31, 2025 on income before income tax of $13.1 million, or (33.7)%, compared to an income tax benefit of $0.1 million on income before income tax of $33.6 million, or (0.3)%, for the year ended December 31, 2024.
Added
The years ended December 31, 2025 and 2024 included $1.9 million and $4.0 million of discrete tax benefits, primarily for deferred tax adjustments and the reversal of uncertain tax provisions, respectively. Excluding the respective $1.9 million and $4.0 million of discrete tax benefits, the effective income tax rate was (19.5)% and 11.5% in 2025 and 2024, respectively.
Added
The change in the effective income tax rate for 2025 compared to 2024, excluding the impact of discrete items, is primarily due to an increase in losses at entities that do not benefit from percentage depletion. Losses generated by these entities generate tax deductions at the statutory rate.
Added
This shift in the mix of pre-tax income resulted in a benefit tax rate in 2025. In addition, the benefit from percentage depletion is not directly related to the amount of pre-tax income recorded in a period.
Added
Accordingly, in periods where income or loss before income tax is relatively small, the proportional effect of the benefit from percentage depletion on the effective tax rate may be significant.
Added
When income tax expense is recorded, the benefit from percentage depletion decreases the effective income tax rate, while the effect is to increase the effective income tax rate when a benefit for income taxes is recorded. See Note 13 to the Consolidated Financial Statements in this Form 10-K for further discussion of our income taxes. 49 Table of Contents

Item 7. Management's Discussion & Analysis

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

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Biggest changeAmong the factors that could cause plans, actions and results to differ materially from current expectations are, without limitation: (1) changes to or termination of customer or other third-party contracts, or a customer or other third party default under a contract, (2) any customer's premature facility closure or extended project development delay, (3) regulatory actions, including the United States EPA's rules finalized in 2024 relating to mercury and greenhouse gas emissions for coal-fired power plants, changes in mining permit requirements or delays in obtaining mining permits that could affect deliveries to customers, (4) a significant reduction in purchases by the Company's customers, including as a result of changes in coal consumption patterns of U.S. electric power generators, or changes in the power industry that would affect demand for the Company's coal and other mineral reserves, (5) changes in the prices of hydrocarbons, particularly diesel fuel, natural gas, natural gas liquids and oil as a result of factors such as OPEC and/or government actions, geopolitical developments, economic conditions and regulatory changes, as well as supply and demand dynamics, (6) changes in development plans by third-party lessees of the Company's mineral interests, (7) failure or delays by the Company's lessees in achieving expected production of natural gas and other hydrocarbons; the availability and cost of transportation and processing services in the areas where the Company's oil and gas reserves are located; federal and state legislative and regulatory initiatives relating to hydraulic fracturing and U.S. export of natural gas; and the ability of lessees to obtain capital or financing needed for well-development operations and leasing and development of oil and gas reserves on federal lands, (8) failure to obtain adequate insurance coverages at reasonable rates, (9) supply chain disruptions, including price increases and shortages of parts and materials, (10) changes in tax laws or regulatory requirements, including the elimination of, or reduction in, the percentage depletion tax deduction, changes in mining or power plant emission regulations and health, safety or environmental legislation, (11) impairment charges, (12) changes in costs related to geological and geotechnical conditions, repairs and maintenance, new equipment and replacement parts, fuel or other similar items, (13) weather conditions, extended power plant outages, liquidity events or other events that would change the level of customers' coal or aggregates requirements, (14) weather or equipment problems that could affect deliveries to customers, (15) changes in the costs to reclaim mining areas, (16) costs to pursue and develop new mining, mitigation, oil and gas and solar development opportunities and other value-added service opportunities, (17) delays or reductions in coal or aggregates deliveries, (18) the ability to successfully evaluate investments and achieve intended financial results in new business and growth initiatives, (19) disruptions from natural or human causes, including severe weather, accidents, fires, earthquakes and terrorist acts, any of which could result in suspension of operations or harm to people or the environment, and (20) the ability to attract, retain, and replace workforce and administrative employees. 63 Table of Contents Item 7A.
Biggest changeAmong the factors that could cause plans, actions and results to differ materially from current expectations are, without limitation: (1) a significant reduction in demand by the Company's customers, (2) weather conditions, extended power plant outages, liquidity events or other events that would change the level of customers' coal or aggregates requirements, (3) changes to or termination of customer or other third-party contracts, or a customer or other third party default under a contract, (4) changes in the prices of hydrocarbons, particularly diesel fuel, natural gas, natural gas liquids and oil as a result of factors such as OPEC and/or government actions, geopolitical developments, economic conditions and regulatory changes, vehicle electrification, as well as supply and demand dynamics, (5) changes in development plans by third-party lessees of the Company's mineral interests, (6) failure or delays by the Company's lessees in achieving expected production of natural gas and other hydrocarbons; the availability and cost of transportation and processing services in the areas where the Company's oil and gas reserves are located; and the ability of lessees to obtain capital or financing needed for well-development operations and leasing and development of oil and gas reserves on federal lands, (7) any customer's premature facility closure or extended project development delay, (8) federal and state legislative and regulatory actions affecting fossil fuels, (9) supply chain disruptions, including price increases and shortages of parts and materials, inclusive of tariff effects, (10) failure to obtain adequate insurance coverages at reasonable rates, (11) changes in tax laws or regulatory requirements, including the elimination of, or reduction in, the percentage depletion tax deduction, changes in mining or power plant emission regulations and health, safety or environmental legislation, (12) impairment charges, (13) changes in costs related to geological and geotechnical conditions, repairs and maintenance, new equipment and replacement parts, fuel or other similar items, (14) equipment problems that could affect deliveries to customers, (15) changes in the costs to reclaim mining areas, (16) costs to pursue and develop new mining, mitigation, oil and gas and power generation development opportunities and other value-added service opportunities, (17) the ability to successfully evaluate investments and achieve intended financial results in new business and growth initiatives, (18) disruptions from natural or human causes, including severe weather, accidents, fires, earthquakes and terrorist acts, any of which could result in suspension of operations or harm to people or the environment, and (19) the ability to attract, retain, and replace workforce and administrative employees. 58 Table of Contents Item 7A.
The Facility provides the ability to make loans, dividends and advances to NACCO, with some restrictions based on maintaining a maximum debt to EBITDA ratio of 1.50 to 1.00, or if greater than 1.50 to 1.00, a Fixed Charge Coverage Ratio of 1.10 to 1.00.
The Facility provides the ability to make loans, dividends and advances to NACCO, with some restrictions based on maintaining a maximum net debt to EBITDA ratio of 1.50 to 1.00, or if greater than 1.50 to 1.00, a Fixed Charge Coverage Ratio of 1.10 to 1.00.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) We believe funds available from cash on hand, the Facility and operating cash flows will provide sufficient liquidity to meet our operating needs and commitments arising during the next twelve months and until the expiration of the Facility in September 2028.
We believe funds available from cash on hand, the Facility and operating cash flows will provide sufficient liquidity to meet our operating needs and commitments arising during the next twelve months and until the expiration of the Facility in September 2028.
The table below shows the average price as reported by the United States Energy Information Administration for the twelve months ended December 31: 2024 2023 West Texas Intermediate Average Crude Oil Price $ 76.55 $ 77.64 Henry Hub Average Natural Gas Price $ 2.19 $ 2.54 These indicated prices do not necessarily reflect the contract terms for our sales.
The table below shows the average price as reported by the United States Energy Information Administration for the years ended December 31: 2025 2024 West Texas Intermediate Average Crude Oil Price $ 65.46 $ 76.55 Henry Hub Average Natural Gas Price $ 3.53 $ 2.19 These indicated prices do not necessarily reflect the contract terms for our sales.
Borrowings bear interest at a floating rate plus a margin based on the level of debt to EBITDA ratio achieved. The applicable margins, effective December 31, 2024, for base rate and Term Secured Overnight Financing Rate loans were 1.50% and 2.50%, respectively. The Facility has a commitment fee which is based upon achieving various levels of debt to EBITDA ratios.
The applicable margins, effective December 31, 2025, for base rate and Term Secured Overnight Financing Rate loans were 1.50% and 2.50%, respectively. The Facility has a commitment fee which is based upon achieving various levels of net debt to EBITDA ratios. The commitment fee was 0.40% on the unused commitment at December 31, 2025.
We are a party to certain guarantees related to Coyote Creek. We believe that the likelihood of future performance under the guarantees is remote, and no amounts related to these guarantees have been recorded. See Note 16 to the Consolidated Financial Statements in this Form 10-K for further discussion of our guarantees.
We believe that the likelihood of future performance under the guarantees is remote, and no amounts related to these guarantees have been recorded. See Note 16 to the Consolidated Financial Statements in this Form 10-K for further discussion of our guarantees. We utilize letters of credit to support commitments made in the ordinary course of business.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) MINERALS MANAGEMENT SEGMENT FINANCIAL REVIEW Oil and natural gas prices have been historically volatile and may continue to be volatile in the future.
MINERALS AND ROYALTIES SEGMENT FINANCIAL REVIEW Oil and natural gas prices have been historically volatile and may continue to be volatile in the future.
We utilize letters of credit to support commitments made in the ordinary course of business. As of December 31, 2024 and 2023, outstanding letters of credit totaled $30.9 million and $34.9 million, respectively. ENVIRONMENTAL MATTERS We are affected by the regulations of numerous agencies, particularly the Federal Office of Surface Mining, the U.S. Environmental Protection Agency, the U.S.
As of December 31, 2025 and 2024, outstanding letters of credit totaled $50.5 million and $30.9 million, respectively. ENVIRONMENTAL MATTERS We are affected by the regulations of numerous agencies, particularly the Federal Office of Surface Mining, the U.S. Environmental Protection Agency, the U.S. Army Corps of Engineers and associated state regulatory authorities.
The commitment fee was 0.40% on the unused commitment at December 31, 2024. During the years ended December 31, 2024 and December 31, 2023, the average borrowing under the Facility was $27.2 million and $6.2 million, respectively, and the weighted-average annual interest rate was 8.83% and 6.06%, respectively.
During the years ended December 31, 2025 and December 31, 2024, the average borrowing under the Facility was $57.3 million and $27.2 million, respectively, and the weighted-average annual interest rate was 7.21% and 8.83%, respectively.
At December 31, 2024, the excess availability under the Facility was $99.1 million, which reflects a reduction for outstanding letters of credit of $30.9 million. NACCO has not guaranteed any borrowings of NACCO Natural Resources. The Facility allows for the payment to NACCO of dividends and advances under certain circumstances.
Borrowings outstanding under the Facility were $75.0 million at December 31, 2025. At December 31, 2025, the excess availability under the Facility was $74.5 million, which reflects a reduction for outstanding letters of credit of $50.5 million. NACCO has not guaranteed any borrowings of NACCO Natural Resources.
The obligations under the Facility are guaranteed by certain of NACCO Natural Resources' direct and indirect, existing and future domestic subsidiaries, and is secured by certain assets of NACCO Natural Resources and the guarantors, subject to customary exceptions and limitations. 55 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
At December 31, 2025, NACCO Natural Resources was in compliance with all financial covenants in the Facility. The obligations under the Facility are guaranteed by certain of NACCO Natural Resources' direct and indirect, existing and future domestic subsidiaries, and is secured by certain assets of NACCO Natural Resources and the guarantors, subject to customary exceptions and limitations.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) NORTH AMERICAN MINING (NAMining) SEGMENT FINANCIAL REVIEW Aggregate tons delivered by the NAMining segment were as follows for the years ended December 31: 2024 2023 Total tons delivered 54,963 56,655 The results of operations for the NAMining segment were as follows for the years ended December 31: 2024 2023 Total revenues $ 119,600 $ 90,532 Reimbursable costs 74,636 56,611 Revenues excluding reimbursable costs $ 44,964 $ 33,921 Revenues $ 119,600 $ 90,532 Cost of sales 110,821 83,719 Gross profit 8,779 6,813 Earnings of unconsolidated operations (a) 5,010 5,361 Selling, general and administrative expenses 8,365 8,308 (Gain) loss on sale of assets (348) 518 Operating profit $ 5,772 $ 3,348 (a) See Note 16 to the Consolidated Financial Statements in this Form 10-K for a discussion of our unconsolidated subsidiaries, including summarized financial information. 2024 Compared with 2023 Revenues excluding reimbursable costs increased 32.6% in 2024 compared with 2023, mainly due to favorable pricing and delivery mix at the consolidated limestone quarries and an increase in the scope of work at Sawtooth.
CONTRACT MINING SEGMENT FINANCIAL REVIEW Aggregate tons delivered by the Contract Mining segment were as follows for the years ended December 31: 2025 2024 Total tons delivered 54,885 54,963 The results of operations for the Contract Mining segment were as follows for the years ended December 31: 2025 2024 Total revenues $ 140,013 $ 119,600 Reimbursable costs 91,116 74,636 Revenues excluding reimbursable costs $ 48,897 $ 44,964 Revenues $ 140,013 $ 119,600 Cost of sales 129,876 110,821 Gross profit 10,137 8,779 Earnings of unconsolidated operations (a) 4,789 5,010 Selling, general and administrative expenses 9,321 8,365 Gain on sale of assets (162) (348) Operating profit $ 5,767 $ 5,772 (a) See Note 16 to the Consolidated Financial Statements in this Form 10-K for a discussion of our unconsolidated subsidiaries, including summarized financial information. 2025 Compared with 2024 Total revenues increased in 2025 compared with 2024, primarily due to an increase in reimbursable costs, which have an offsetting amount in cost of sales and have no impact on gross profit.
Expenditures for property, plant and equipment and mineral interests Following is a table which summarizes actual and planned expenditures (in millions): Planned Actual Actual 2025 2024 2023 NACCO $ 58.0 $ 55.4 $ 82.1 Planned expenditures for 2025 are expected to be approximately $13 million in the Coal Mining segment, $17 million in the NAMining segment, $20 million in the Minerals Management segment and $8 million in growth businesses included in Unallocated Items.
Expenditures for property, plant and equipment and mineral interests Following is a table which summarizes expenditures (in millions): Planned Actual Actual 2026 2025 2024 NACCO $ 89.0 $ 53.3 $ 55.4 Actual expenditures for 2025 were $8.0 million in the Utility Coal Mining Segment, $32.0 million in the Contract Mining segment, $7.7 million in the Minerals and Royalties segment and $5.6 million in growth business included in Unallocated Items.
NAMining's subsidiary, Sawtooth, is the exclusive provider of comprehensive mining services at Thacker Pass, which is owned by Lithium Americas Corp. (TSX: LAC) (NYSE: LAC). Sawtooth will supply all of the lithium-bearing ore requirements for Thacker Pass, which is currently under construction. We expect to continue to recognize moderate income at Sawtooth while it assists with certain construction services.
Sawtooth, a North American Mining subsidiary, provides exclusive comprehensive mining services at Thacker Pass, which is owned by a joint venture led by Lithium Americas Corp. (TSX: LAC; NYSE: LAC). Sawtooth will supply all of the lithium-bearing ore requirements for our customer's Thacker Pass lithium processing facility, which is currently under construction.
The increase in earnings of unconsolidated operations was primarily due to improved results at Falkirk, primarily due to a higher per ton management fee beginning in June 2024 when temporary price concessions ended and an increase in customer demand. Improved results at Coteau also contributed to the increase in earnings of unconsolidated operations. 58 Table of Contents Item 7.
The increase in earnings of unconsolidated operations was primarily due to a higher per ton management fee at Falkirk as temporary price concessions ended in the second quarter of 2024.
The following table identifies the components of change in Operating profit (loss) for 2024 compared with 2023: Operating Profit (Loss) 2023 $ (71,342) Increase (decrease) from: Long-lived asset impairment charge in 2023 60,832 Business interruption insurance recoveries 13,612 Gross loss, excluding inventory impairment charges 14,710 Earnings of unconsolidated operations 7,188 Amortization of intangibles 2,467 Inventory impairment charges (2,129) Selling, general and administrative expenses (973) Net change on sale of assets (54) 2024 $ 24,311 Operating profit (loss) changed favorably by $95.7 million in 2024 compared with 2023.
The following table identifies the components of change in Operating profit for 2025 compared with 2024: Operating Profit 2024 $ 24,311 Increase (decrease) from: Business interruption insurance recoveries in 2024 (13,612) Selling, general and administrative expenses (590) Amortization of intangibles (219) Net change on sale of assets (182) Gross loss 4,797 Earnings of unconsolidated operations 2,650 2025 $ 17,155 53 Table of Contents Item 7.
The results of operations for the Minerals Management segment were as follows for the years ended December 31: 2024 2023 Oil and natural gas revenues $ 27,157 $ 22,922 Other revenues 7,422 10,063 Total Revenues $ 34,579 $ 32,985 Total Revenues $ 34,579 $ 32,985 Cost of sales 5,234 3,969 Gross profit 29,345 29,016 Earnings of unconsolidated operations 647 — Selling, general and administrative expenses and asset impairment charge 5,577 9,556 (Gain) loss on sale of assets (4,512) 42 Operating profit $ 28,927 $ 19,418 Revenues increased in 2024 compared with 2023 primarily due to an increase in oil and natural gas revenues as a result of increased oil production volumes related to an acquisition that closed during the fourth quarter of 2023.
The results of operations for the Minerals and Royalties segment were as follows for the years ended December 31: 2025 2024 Oil and natural gas revenues $ 31,307 $ 27,157 Other revenues 6,323 7,422 Total Revenues $ 37,630 $ 34,579 Total Revenues $ 37,630 $ 34,579 Cost of sales 5,666 5,234 Gross profit 31,964 29,345 Earnings of unconsolidated operations 2,571 647 Selling, general and administrative expenses 5,444 5,577 Gain on sale of assets (17) (4,512) Operating profit $ 29,108 $ 28,927 Revenues increased 8.8% in 2025 compared with 2024 primarily due to an increase in natural gas revenue as a result of higher natural gas prices and increased production, partially offset by a decrease in oil revenue as a result of lower oil prices and decreased production. 55 Table of Contents Item 7.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) LIQUIDITY AND CAPITAL RESOURCES Cash Flows The following tables detail the change in cash flow for the years ended December 31: 2024 2023 Change Operating activities: Net income (loss) $ 33,741 $ (39,587) $ 73,328 Depreciation, depletion and amortization 24,652 29,387 (4,735) Deferred income taxes 1,517 (21,114) 22,631 Stock-based compensation 5,832 5,157 675 (Gain) loss on sale of assets (5,146) 221 (5,367) Inventory impairment charges 9,643 7,514 2,129 Long-lived asset impairment charge — 65,887 (65,887) Other (3,352) 1,473 (4,825) Working capital changes (44,598) 5,552 (50,150) Net cash provided by operating activities 22,289 54,490 (32,201) Investing activities: Expenditures for property, plant and equipment and acquisition of mineral interests (55,419) (82,122) 26,703 Proceeds from the sale of assets 822 561 261 Proceeds from the sale of private company equity units — 3,574 (3,574) Equity method investment (16,556) (3,464) (13,092) Other (139) (146) 7 Net cash used for investing activities (71,292) (81,597) 10,305 Cash flow before financing activities $ (49,003) $ (27,107) $ (21,896) The $32.2 million unfavorable change in net cash provided by operating activities during 2024 compared with 2023 was primarily due to an unfavorable change in cash provided by working capital, partially offset by an increase in cash provided by net income adjusted for non-cash items.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) LIQUIDITY AND CAPITAL RESOURCES Cash Flows The following tables detail the change in cash flow for the years ended December 31: 2025 2024 Change Operating activities: Net income $ 17,574 $ 33,741 $ (16,167) Depreciation, depletion and amortization 25,277 24,652 625 Deferred income taxes 58 1,517 (1,459) Stock-based compensation 8,280 5,832 2,448 Gain on sale of assets (286) (5,146) 4,860 Inventory impairment charges 6,986 9,643 (2,657) Pension settlement charge 7,804 — 7,804 Other 8,006 (3,352) 11,358 Changes in operating assets and liabilities (22,790) (44,598) 21,808 Net cash provided by operating activities 50,909 22,289 28,620 Investing activities: Expenditures for property, plant and equipment and acquisition of mineral interests (53,286) (55,419) 2,133 Proceeds from the sale of assets 2,799 822 1,977 Equity method investment (16,702) (16,556) (146) Return of equity method investment 3,295 — 3,295 Other (282) (139) (143) Net cash used for investing activities (64,176) (71,292) 7,116 Cash flow before financing activities $ (13,267) $ (49,003) $ 35,736 The $28.6 million favorable change in net cash provided by operating activities during 2025 compared with 2024 was primarily due to changes in operating assets and liabilities.
Operating Profit 2023 $ 3,348 Increase (decrease) from: Gross profit 1,966 Net change on sale of assets 866 Earnings of unconsolidated operations (351) Selling, general and administrative expenses (57) 2024 $ 5,772 Operating profit increased $2.4 million in 2024 compared with 2023 primarily due to an increase in gross profit and a favorable change on the sale of assets.
Operating Profit 2024 $ 28,927 Increase (decrease) from: Gross profit 2,619 Earnings of unconsolidated operations 1,924 Selling, general and administrative expenses 133 Gain on sale of assets (4,495) 2025 $ 29,108 Operating profit increased by $0.2 million in 2025 compared with 2024, primarily due to improvements in gross profit and earnings of unconsolidated operations.
Financing Activities In September 2024, NACCO Natural Resources amended the secured revolving line of credit (Facility) to increase the revolving credit commitments to $200.0 million and extend the maturity to September 2028. Borrowings outstanding under the Facility were $70.0 million at December 31, 2024.
See Note 12 to the Consolidated Financial Statements in this Form 10-K for a discussion of our stock repurchase programs. Financing Activities In September 2024, NACCO Natural Resources amended its secured revolving line of credit (Facility) to increase the revolving credit commitments to $200.0 million and extend the maturity to September 2028.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC. AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) NACCO has unrecognized tax benefits, including interest and penalties. See Note 13 to the Consolidated Financial Statements in this Form 10-K for further discussion of our income taxes.
See Note 7 to the Consolidated Financial Statements in this Form 10-K for further discussion of our asset retirement obligations. NACCO has unrecognized tax benefits, including interest and penalties. See Note 13 to the Consolidated Financial Statements in this Form 10-K for further discussion of our income taxes. We are a party to certain guarantees related to Coyote Creek.
Our policies stress environmental responsibility and compliance with these regulations. See Item 1 and Item 1A. in Part I of this Form 10-K for further discussion of these matters. SEGMENT RESULTS COAL MINING SEGMENT FINANCIAL REVIEW See Item 2. Properties on page 29 in this Form 10-K for discussion of our mineral resources and mineral reserves.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) SEGMENT RESULTS UTILITY COAL MINING SEGMENT FINANCIAL REVIEW See Item 2. Properties on page 25 in this Form 10-K for discussion of our mineral resources and mineral reserves.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) 2024 2023 Change Financing activities: Net additions to long-term debt and revolving credit agreements $ 55,710 $ 11,023 $ 44,687 Debt issuance costs (2,415) — $ (2,415) Cash dividends paid (6,624) (6,452) (172) Purchase of treasury shares (9,944) (3,103) (6,841) Net cash provided by financing activities $ 36,727 $ 1,468 $ 35,259 The change in net cash provided by financing activities was primarily due to higher additions in debt borrowings during 2024 compared with 2023, partially offset by increased share repurchases and debt issuance costs during 2024.
These favorable items were partially offset by an unfavorable change in accrued expenses, mainly attributable to a decrease in accrued payroll during the 2025 period, whereas accrued payroll increased during 2024. 2025 2024 Change Financing activities: Net additions to long-term debt and revolving credit agreements $ 11 $ 55,710 $ (55,699) Debt issuance costs — (2,415) $ 2,415 Cash dividends paid (7,335) (6,624) (711) Purchase of treasury shares (2,534) (9,944) 7,410 Net cash (used for) provided by financing activities $ (9,858) $ 36,727 $ (46,585) The change in net cash (used for) provided by financing activities was primarily due to relatively consistent debt borrowings during 2025 compared with additions during 2024.
The increase in Other non-current asset was primarily due to our investment of $15.7 million in Eiger, which holds non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin. The increase in Inventory was mainly due to higher mining supplies and coal inventory.
During 2025, we invested an additional $15.0 million in Eiger Resources, which holds operated and non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin. This resulted in an increase in Equity method investment in Eiger Resources.
Tons of coal delivered by the Coal Mining segment were as follows for the years ended December 31: 2024 2023 Unconsolidated mines 21,308 20,741 Consolidated mines 1,922 2,931 Total tons delivered 23,230 23,672 The results of operations for the Coal Mining segment were as follows for the years ended December 31: 2024 2023 Revenues $ 68,611 $ 85,415 Cost of sales 79,375 108,760 Gross loss (10,764) (23,345) Earnings of unconsolidated operations (a) 51,821 44,633 Business interruption insurance recoveries 13,612 — Selling, general and administrative expenses and long-lived asset impairment charge 30,112 89,971 Amortization of intangible assets 531 2,998 Gain on sale of assets (285) (339) Operating profit (loss) $ 24,311 $ (71,342) 57 Table of Contents Item 7.
Tons of coal delivered by the Utility Coal Mining segment were as follows for the years ended December 31: 2025 2024 Unconsolidated mines 20,400 21,308 Consolidated mines 2,730 1,922 Total tons delivered 23,130 23,230 The results of operations for the Utility Coal Mining segment were as follows for the years ended December 31: 2025 2024 Revenues $ 88,188 $ 68,611 Cost of sales 94,155 79,375 Gross loss (5,967) (10,764) Earnings of unconsolidated operations (a) 54,471 51,821 Business interruption insurance recoveries — 13,612 Selling, general and administrative expenses 30,702 30,112 Amortization of intangible assets 750 531 Gain on sale of assets (103) (285) Operating profit $ 17,155 $ 24,311 (a) See Note 16 to the Consolidated Financial Statements in this Form 10-K for a discussion of our unconsolidated subsidiaries, including summarized financial information. 2025 Compared with 2024 Revenues increased 28.5% in 2025 compared with 2024 primarily due to an increase in customer requirements at MLMC partially offset by a reduction in the contractually determined per ton sales price.
Dividends (to the extent permitted by the Facility) and management fees are the primary sources of cash for NACCO and enable us to pay dividends to stockholders and repurchase shares. The Facility has performance-based pricing, which sets interest rates based upon NACCO Natural Resources achieving various levels of debt to EBITDA ratios, as defined in the Facility.
The Facility allows for the payment to NACCO of dividends and advances under certain circumstances. Dividends (to the extent permitted by the Facility) and management fees are the primary sources of cash for NACCO and enable us to pay dividends to stockholders and repurchase shares.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) UNALLOCATED ITEMS AND ELIMINATIONS FINANCIAL REVIEW Unallocated Items and Eliminations were as follows for the years ended December 31: 2024 2023 Operating loss $ (23,305) $ (21,561) 2024 Compared with 2023 The operating loss increased during 2024 compared with 2023 primarily due to higher employee-related costs, partially offset by lower expenses for growth initiatives as certain costs expensed in 2023 were capitalized in 2024.
UNALLOCATED ITEMS AND ELIMINATIONS FINANCIAL REVIEW Unallocated Items and Eliminations were as follows for the years ended December 31: 2025 2024 Operating loss $ (30,049) $ (23,305) 2025 Compared with 2024 Operating loss increased during 2025 compared with 2024 primarily due to an increase in selling, general and administrative expenses.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC. AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) undiscounted cash flows generated from the use of the asset or asset group and its eventual disposition with the asset's net carrying value.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC. AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) The following table identifies the components of change in Operating profit for 2025 compared with 2024.
Reimbursable costs, which have an offsetting amount in cost of sales and have no impact on gross profit, also increased during 2024. The following table identifies the components of change in Operating profit for 2024 compared with 2023.
Revenues excluding reimbursable costs increased 8.7% in 2025 compared with 2024, mainly due to an increase in part sales. The following table identifies the components of change in Operating profit for 2025 compared with 2024.
Capital Structure NACCO's consolidated capital structure is presented below: December 31 2024 2023 Change Cash and cash equivalents $ 72,833 $ 85,109 $ (12,276) Other net tangible assets 451,962 349,934 102,028 Intangible assets, net 5,475 6,006 (531) Net assets 530,270 441,049 89,221 Total debt (99,514) (35,956) (63,558) Closed mine obligations (25,809) (22,753) (3,056) Total equity $ 404,947 $ 382,340 $ 22,607 Debt to total capitalization 20 % 9 % 11 % The increase in other net tangible assets was mainly the result of increases in Property, plant and equipment, Other non-current assets and Inventory during 2024.
Capital Structure NACCO's consolidated capital structure is presented below: December 31 2025 2024 Change Cash and cash equivalents $ 49,708 $ 72,833 $ (23,125) Other net tangible assets 500,411 451,962 48,449 Intangible assets, net 4,725 5,475 (750) Net assets 554,844 530,270 24,574 Total debt (100,895) (99,514) (1,381) Closed mine obligations (24,706) (25,809) 1,103 Total equity $ 429,243 $ 404,947 $ 24,296 Debt to total capitalization 19 % 20 % (1) % The increase in other net tangible assets was mainly the result of increases in Property, plant and equipment, the Equity method investment in Eiger Resources and the establishment of the Prepaid profit sharing asset during 2025.
We continue to maintain the highest levels 62 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC. AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) of customer service and operational excellence with an unwavering focus on safety and environmental stewardship.
This change was partially offset by decreases in share repurchases and debt 50 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC. AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) issuance costs during 2025.
See Note 14 to the Consolidated Financial Statements in this Form 10-K for further information on the Combined Defined Benefit Plan. 52 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
In addition, we closely monitor proposed legislation and regulation concerning SMCRA, CAA, ACE, CWA, RCRA, CERCLA, OBBBA and other regulatory actions. See Item 1 and Item 1A. in Part I of this Form 10-K for further discussion of these matters. 52 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
The Minerals Management segment, through its Catapult business, has constructed a high-quality, diversified portfolio of oil and gas mineral and royalty interests in the United States.
This project is providing stable income during construction and is expected to contribute increased income and long-term cash flows once lithium production commences, which is targeted for late 2027. The Minerals and Royalties segment, managed by Catapult, has constructed a high-quality, diversified portfolio of oil and gas mineral and royalty interests in the United States.
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) (a) See Note 16 to the Consolidated Financial Statements in this Form 10-K for a discussion of our unconsolidated subsidiaries, including summarized financial information. 2024 Compared with 2023 Revenues decreased 19.7% in 2024 compared with 2023 due to a reduction in customer requirements at MLMC as a result of a boiler issue at the customer's Red Hills Power Plant.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC. AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) Operating profit decreased by $7.2 million in 2025 compared with 2024 primarily due to the absence of MLMC's business interruption insurance recoveries for the boiler issue at the Red Hills Power Plant.
See Note 14 to the Consolidated Financial Statements in this Form 10-K for further information on future benefit payments. NACCO has asset retirement obligations. See Note 7 to the Consolidated Financial Statements in this Form 10-K for further discussion of our asset retirement obligations. 56 Table of Contents Item 7.
These funds will be used for future profit sharing contributions to eligible 401(k) plan participants, which resulted in an increase in Prepaid profit sharing. See Note 1 to the Consolidated Financial Statements in this Form 10-K for further information on the excess funds. Contractual Obligations, Contingent Liabilities and Commitments NACCO has asset retirement obligations.
Selling, general and administrative expenses include a $0.9 million charge to establish an allowance against a receivable from one of NAMining's customers during 2024, which was offset by a reduction in outside services. 59 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
The increase in selling, general and administrative expenses during 2025 was primarily the result of higher employee-related costs, partially offset by the absence of a $0.9 million prior year charge to establish an allowance against a customer receivable.
The reduction in revenues at MLMC was offset by lower cost of goods sold, resulting in a decrease in the gross loss during 2024 compared with 2023.
This unfavorable change was partially offset by a decrease in gross loss and an increase in earnings of unconsolidated operations. Gross loss was favorable during 2025 compared with the 2024 period, primarily due to an increase in customer requirements and a reduction in cost per ton delivered.
See Note 13 to the Consolidated Financial Statements in this Form 10-K for further discussion of our income taxes. 53 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Improvements at MLMC as a result of an increase in the contractually determined per ton sales price are expected 56 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Removed
If the carrying value of an asset is considered impaired, an impairment charge is recorded for the amount that the carrying value of the long-lived asset or asset group exceeds its fair value.
Added
Inventory levels at December 31, 2025 and December 31,2024 were relatively consistent, whereas inventories increased during 2024. Accounts receivable decreased during 2025 due to the timing of collections, whereas accounts receivable increased during 2024.
Removed
Fair value is estimated as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Added
The Facility has performance-based pricing, which sets interest rates based upon NACCO Natural Resources achieving various levels of debt to EBITDA ratios, as defined in the Facility. Borrowings bear interest at a floating rate plus a margin based on the level of debt to EBITDA ratio achieved.
Removed
Identifying and assessing whether impairment indicators exist, or if events or changes in circumstances have occurred, including assumptions about future power plant dispatch levels, changes in future sales price, operating costs and other factors that impact anticipated revenue and customer demand, requires significant judgment.
Added
Capital expenditures were primarily for a dragline and dragline related improvements in the Contract Mining segment.
Removed
We determined that indicators of impairment existed at MLMC during the fourth quarter of 2023 and, as a result, MLMC's long-lived assets were reviewed for impairment. We assessed the recoverability of the MLMC asset group and determined that the assets were not fully recoverable when compared to the remaining future undiscounted cash flows from these assets.
Added
Capital expenditures for 2026 are expected to be up to $6 million in the Utility Coal Mining segment, $36 million in the Contract Mining segment, $20 million in the Minerals and Royalties segment and $27 million in growth businesses included in 51 Table of Contents Item 7.
Removed
As a result, we estimated the fair value of the asset group which resulted in a non-cash, long-lived asset impairment charge of $65.9 million in 2023. See Note 9 to the Consolidated Financial Statements in this Form 10-K for further discussion of our impairment analysis.
Added
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC. AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) Unallocated Items. The majority of these expenditures relate to business development opportunities and will only be made if the projects meet our growth investment criteria.
Removed
Income taxes: We file income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions. Tax law requires certain items to be included in the tax return at different times than the items are reflected in the financial statements.
Added
See Note 1 to the Consolidated Financial Statements in this Form 10-K for further information on Eiger Resources. The excess funds from the terminated Combined Plan as well as the excess funds from the Falkirk Defined Benefit Plan will be utilized by the NACCO 401(k) plan, which is a qualified replacement plan.
Removed
Some of these differences are permanent, such as the benefit associated with percentage depletion (tax deductions for depletion that may exceed the tax basis in the mineral reserve) and expenses that are not deductible for tax purposes, and some differences are temporary, reversing over time, such as depreciation expense.
Added
A boiler issue at the customer's Red Hills Power Plant reduced customer requirements in 2024.
Removed
These temporary differences create deferred tax assets and liabilities using currently enacted tax rates. The objective of accounting for income taxes is to recognize the amount of taxes payable or refundable for the current year, and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the financial statements or tax returns.
Added
Operating Profit 2024 $ 5,772 Increase (decrease) from: Gross profit 1,358 Selling, general and administrative expenses (956) Net change on sale of assets (186) Earnings of unconsolidated operations (221) 2025 $ 5,767 54 Table of Contents Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NACCO INDUSTRIES, INC.
Removed
The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the provision for income taxes in the period that includes the enactment date.
Added
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) Operating profit was comparable during 2025 and 2024. An increase in gross profit was largely offset by an increase in selling, general and administrative expenses.
Removed
Management is required to estimate the timing of the recognition of deferred tax assets and liabilities, make assumptions about the future deductibility of deferred tax assets and assess deferred tax liabilities based on enacted laws and tax rates for the appropriate tax jurisdictions to determine the amount of such deferred tax assets and liabilities.
Added
The improvement in gross profit was mainly the result of an increase in part sales partially offset by a $1.1 million charge to establish a loss contingency in 2025.
Removed
Changes in the calculated deferred tax assets and liabilities may occur in certain circumstances, including statutory income tax rate changes, statutory tax law changes, or changes in the structure or tax status. Our tax assets, liabilities, and tax expense are supported by historical earnings and losses and our best estimates and assumptions of future earnings.
Added
See Item 2. Properties on page 40 in this Form 10-K discussion of our proved reserves.
Removed
We assess whether a valuation allowance should be established against our deferred tax assets based on consideration of all available evidence, both positive and negative, using a more likely than not standard. This assessment considers, among other matters, scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations.
Added
The increase in gross profit was mainly due to higher natural gas revenues. The increase in earnings of unconsolidated operations was primarily related to an additional investment in Eiger Resources during the fourth quarter of 2024. These increases were partially offset by the absence of a $4.5 million prior year gain on sale of land.
Removed
The assumptions about future taxable income require significant judgment and are consistent with the plans and estimates we use to manage the underlying businesses. When we determine, based on all available evidence, that it is more likely than not that deferred tax assets will not be realized, a valuation allowance is established.
Added
This increase was mainly the result of higher employee-related costs and increased costs related to our business development projects. Employee-related costs increased primarily due to elevated medical costs and higher share-based incentive compensation expense as a result of an increase in our share price during 2025. NACCO Industries, Inc.
Removed
Since significant judgment is required to assess the future tax consequences of events that have been recognized in our financial statements or tax returns, the ultimate resolution of these events could result in adjustments to our financial statements and such adjustments could be material.
Added
Outlook NACCO Industries is a growing diversified natural resources company with a unique business model strategically positioned to deliver stable and growing financial returns over the long term.
Removed
We believe the current assumptions, judgments and other considerations used to estimate the current year accrued and deferred tax positions are appropriate.
Added
Our business model is purposely built for durability and resilience with an expanding portfolio of long-term contracts, relationships and investments that leverage our proven operational expertise, disciplined capital allocation and an entrepreneurial yet patient approach.
Removed
If the actual outcome of future tax consequences differs from these estimates and assumptions, due to changes or future events, the resulting change to the provision for income taxes could have a material impact on our results of operations and financial position. Since 2021, we have participated in a voluntary program with the IRS called Compliance Assurance Process (CAP).
Added
We have methodically built unique capabilities and clear competitive advantages that allow us to pursue a wide range of growth opportunities, often completely integrated into customers’ operations in partnership-based relationships. We have multiple vectors for value creation, and we are steadfastly committed to delivering compounding returns and expanding investor value over the long term.
Removed
The objective of CAP is to contemporaneously work with the IRS to achieve federal tax compliance and resolve all or most issues prior to the filing of the tax return. See Note 13 to the Consolidated Financial Statements in this Form 10-K for further discussion of our income taxes. 51 Table of Contents Item 7.
Added
Our foundation rests on a stable base of long-term coal-mining contracts and legacy mineral and royalty assets, which generate dependable recurring cash flows. As new long-term contracts and investments are added across the Company, these new multi-year agreements create a “layering” effect as their contributions compound. This provides cash flow stability.
Removed
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) CONSOLIDATED FINANCIAL SUMMARY Our results of operations were as follows for the years ended December 31: 2024 2023 Revenues: Coal Mining $ 68,611 $ 85,415 NAMining 119,600 90,532 Minerals Management 34,579 32,985 Unallocated Items 17,707 8,459 Eliminations (2,789) (2,597) Total revenue $ 237,708 $ 214,794 Operating profit (loss): Coal Mining $ 24,311 $ (71,342) NAMining 5,772 3,348 Minerals Management 28,927 19,418 Unallocated Items (23,317) (21,461) Eliminations 12 (100) Total operating profit (loss) $ 35,705 $ (70,137) Interest expense 5,566 2,460 Interest income (4,428) (6,081) Closed mine obligations 2,381 3,585 Gain on equity securities (1,805) (1,958) Other, net 345 (3,985) Other expense (income), net 2,059 (5,979) Income (loss) before income tax benefit 33,646 (64,158) Income tax benefit (95) (24,571) Net income (loss) $ 33,741 $ (39,587) Effective income tax rate (0.3) % 38.3 % The components of the change in revenues and operating profit are discussed below in Segment Results.
Added
The momentum our operations experienced in 2025, particularly in the second half, is expected to continue into 2026, with meaningful year-over-year improvements in consolidated operating profit, net income and EBITDA. At our Utility Coal Mining segment, operated by North American Coal, we expect an increase in operating profit compared with 2025.
Removed
Other expense (income), net Interest expense increased in 2024 compared with 2023 due to higher average borrowings as well as an increase in interest rates. Interest income decreased in 2024 compared with 2023 due to lower earnings on reduced cash balances. Gain on equity securities represents changes in the market price of invested assets reported at fair value.
Added
AND SUBSIDIARIES (Tabular Amounts in Thousands, Except Per Share and Percentage Data) to be partly offset by lower earnings at the unconsolidated mining operations due to reduced income associated with the wind down of reclamation services at Sabine. While we expect modest year-over-year improvements at MLMC, the customer's power plant began a maintenance outage in mid-February 2026.
Removed
The change during 2024 compared with 2023 was due to fluctuations in the market prices of the exchange-traded equity securities. See Note 9 to the Consolidated Financial Statements in this Form 10-K for further discussion of our invested assets reported at fair value .
Added
The power plant is expected to resume operations in mid-March. Any delay or further changes in demand, dispatch and/or reduced mechanical availability at the power plant could decrease current expectations. The Contract Mining segment, operated by North American Mining, serves as our primary mining growth platform.
Removed
During 2023, our Board of Directors approved the termination of the Combined Defined Benefit Plan and participants were offered lump-sum distributions as part of the termination process. As a result of the lump-sum distributions, we recognized a non-cash, pension settlement charge of $1.8 million in 2023 on the line Other, net within the accompanying Consolidated Statements of Operations.

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