Coronado Global Resources Inc.

Thank you for standing by and welcome to the Coronado Global Resources Fourth Quarter Investor Call. All participants are in a listen-only mode. There will be a discussion of results from the CEO and CFO followed by a question and answer session. If you would like to ask a question, you'll need to press the star key followed by the number one on your telephone keypad. I now lay down the conference over to Chantal Assa, Vice President of Investor Relations. Please go ahead.

Thank you, Darcy, and all for joining Coronado's December and final quarter call for 2025. Today, we released our quarterly report to the ASX and filed with the SEC. Today, I'm joined by our Managing Director and Chief Executive Officer, Douglas Thompson, and Chief Financial Officer, Barry Vandermeer. Within our report, you will see our notice regarding forward-looking statements and reconciliations of certain non-US GAAP financial measures, I also remind everyone that Coronado quotes all numbers in US dollars and metric times unless otherwise stated. I'll now hand over the call to Douglas.

Thank you, Chantelle. Thank you, everybody, for making the time to join us today. Before we begin, I want to acknowledge two tragic incidents that occurred since mid-December. Our thoughts and prayers are with the families, friends and teammates affected by these tragic events. These events are unacceptable. and we continue to work with the relevant authorities and our contracting partners to investigate. The safety and the health of our people are and will remain our highest priority. The journey this company has been on over the past three years has been significant. In 2022, we committed to a disciplined multi-year improvement plan. We always said that if we executed consistently across our cost base, operational stability, fleet performance, workforce capability and capital discipline, it would pay off. And today we can say it has paid off. The structural change to Coronado performance is now unmistakable. We have sustainably lowered our cost base, increased production across both regions and stabilised our operating assets and expanded our capacity in line with our long-term strategy. More importantly, the business is now more predictable, more resilient, and better positioned to leverage improving market conditions than at any point in the past seven years. Then into the highlights for financial 2025 and December quarter. The team delivered salable production of 16 million tonnes, which is 4% increase year on year, finishing at the lower end of guidance. Average mining cost per tonne sold averaged $97 a tonne, a 10% reduction year on year. The capital spend was $245 million for the year at the bottom end of guidance and the major investment phase for the business is now complete. We closed the year with exit run rates that outperformed guidance which demonstrates the structural shift in the production and costs. We had the highest quarterly sales since 2021, quarter three. The sales volumes increased by 11% quarter on quarter. The operating cost was reduced by approximately $300 million across the year. The cannon expansion of Mammoth Underground reached expected run rates in the second half of the year. And Currah's second half saleable production averaged 36% higher than the first half of the year. and remain consistently above 1 million tonnes per month for half year. Focus now shifts to the CHPP upgrades to maximise margin from the now stable low-cost mining base. Material liquidity support from Stanwell reflects our critical role in Queensland's energy security. $150 million was provided mid-2025. And then the subsequent transaction brought forward the 2027 reset we've all been waiting for. With rebate forgiveness and price support that exceeded the original reset expectations for 2027, that we're now enjoying. The 2026 standards mechanisms are expected to provide between $200 and $250 million of cash flow uplift, depending on prices and nominated tonnages. also secured a five-year $265 million covenant-like ABL facility of 9%, which was fully drawn in December and enabled full repayment of our O2 facility and strengthened our near-term liquidity. So stepping back on this year, the message is simple. Our operating base is now more predictable, our cost structures are materially lower, and our expansion investments are delivering. And we have meaningful leverage to improving prices, a clear path to stronger cash generation, balance sheet deleveraging, and future shareholder returns. Focusing on our group's performance, the quarter delivered continued strong operating results. We achieved the highest quarterly and half-year sales volume since 2021. We also set new quarterly and half-year records for ROM and saleable production. Strongest half year since 2019 for RON and since 2021 for saleable production. And unit costs continue to trend down. RON production costs per tonne average $56 a tonne, lower since 2021, and 15% improvement over the past two years. This reflects the disciplined execution of our improvement plan, including higher dragline utilisation and tighter cost control. Our expanded infrastructure at the Cameron Mammoth is now delivering higher and more stable run rates, translating into meaningful cost and productivity gains, and contributed approximately one million tonnes of incremental salable tonnes across the group for the year. With system capacity now 16% pre-investment levels, above pre-investment levels, we're into 2026 in a materially stronger position to utilise this additional capacity as market conditions allow. The full year, we closed at 16 million tonnes of saleable production, a 4% increase year-on-year. In looking ahead, we expect to lift production rates in 2026, supported by our expansion projects. In Australia, the Currah Complex delivered a strong December quarter across all key metrics. With record ROM production and sales volume surpassing levels last achieved in 2020, our dragline system operated at their highest levels since acquisition of the mine in 2018, consistently accounting for approximately 50% of total waste movement, up from historic levels of 30%. This is a significant lower cost method to move prime waste versus truck excavate. These gains reflect the one current plan, which continues to improve pit configuration, decongest operating areas, enhance strike length, and enable sustained gains from fleet rationalization, procurement, and cost management. At Mammoth, the mine ran all three production panels and achieved run rates equivalent to per year during quarter four. As a result, the mining cost per tonne sold in Q4 remained below the low end of guidance. To convert the now stable low-cost mining into maximised margin, we will execute targeted CHPP upgrades earlier this year. While these works may moderate production in the March quarter, they are designed to unlock additional processing capacity. and product yield, strengthening cash generation. As noted in our report, cyclone Koji impacted the Bowen Basin earlier this month. Therefore, expect durability in quarter one's performance. What is pleasing is our recovery. Improving resilience of current complex enabled a much better than historic response and recovery, and we continue to ship committed product to our clients. In the U.S., Buchanan delivered its strongest month since August 2022 during December. We recorded record daily ROM production and record skip counts as the expansion project benefits came to light. In December alone, Buchanan generated approximately 400,000 tonnes of saleable production, $20 million of earnings and achieved a $67 a tonne unit rate for the month. a great achievement and demonstrates our expectations when you look forward. Expansion is delivering as intended. The additional raw and product stockpiles and the second set of skips have increased capacity and created redundancy, enabling a sustained 1 million tonne annualised run rate in December. These facilities also decouple maintenance schedules between the mine and the processing plant, improving overall efficiencies. Shared technical conditions in both the north and southern long walls during October and then November constrained production, resulting in a modest quarter-on-quarter reduction. However, Canon's structural improvements to long walls, higher skip capacity and expanded stockpiles all reduce costs, sustain higher production than at the time of acquisition and support a long life of more than 20 years. four underground mines performed to plan and met forecast production for the quarter. The minor vessel delay into January increased site and port inventories that did not impact the mines, nor did it impact plant performance. And these inventories will support sales volumes during two longer moves scheduled for the March quarter, one that we're in the process of executing and almost complete. With that, I will now hand over to Barry to speak to the financial position.

Thank you, Douglas, and good morning, everyone. As Douglas said earlier, the production and cost results we announced this morning is the result of hard work and dedication of many people over the course of the last three years or so. With the market starting to show signs of improvement, Orinato is well positioned to take advantage of this with our ramped-up projects, lower capital expenditure, good cost control, more robust debt structure, and improved liquidity position and support from Stanwell if liquidity weakens. Starting with costs, in FY25 we achieved approximately $300 million in operating cost reductions versus the prior year. Both Currah and Buchanan averaged around $86 a ton over the last three quarters. This marks a structural shift in the cost position with both those assets now firmly within the midpoint. of the industry cost curve. With a full year of production from the expansion projects, improving prices, and the earlier than planned reset of the Stanwell agreements, profitability and cash flow will benefit materially in FY26. For the year, the group averaged mining cost of $97.60 a ton, which is a material improvement from $107 in FY24 and $108 in FY23. This cost performance is below the midpoint of guidance for FY25, and this was at 64.5 cents FX on average for the year. The December quarter was Currah's strongest for the year, with continuing consistent production of 1 million tonnes per month achieved since June. This is off the back of consistent ROM production and stable mining operations. Having established this rhythm in the mining process and the production bottleneck shifting to the plants, we are starting FY26 with a major plant shutdown for two weeks in February to work on plant reliability and maximising the margin from every tub. With a full year of production for mammoth in FY26, the learnings from the ramp-up embedded in the operation, stable mining performance and the benefits of the February plan shut, as well as a PLV index that has risen approximately 30% over the last three months. Curr is set for a profitable and cash positive FY26, and price and cash flow downside is protected by the recent Stanwell transaction. Douglas said earlier the challenges Buchanan experienced with geological conditions in October and November eased up during December. The mine generated $20 million in EBITDA in one month, with a PLV index at $212 a ton, well below current trading levels. That one-month achievement was almost a third of the full year's earnings in one month. This shows the value of the recent innovative at-the-light expansion project that repurposed an unused ventilation shaft to install added skip capacity. For the full year, the mine was also cash break-even after funding its own expansion capex at a PLV index of $188 a ton. This shows the quality of Buchanan and with the benefit of a full year of the expanded capacity and higher prices, Buchanan is set for strong cash generation in FY26. Capex spent as planned was $38 million in the December quarter, and $245 million for the year. This is the bottom of guidance. It reflects the completion of our major investment phase. As these assets now move from ramp-up to steady state, we expect cash generation FY26, provided market conditions remain positive, as was the case over the last month. Approximately $150 million of short-term liquidity management and working capital initiatives highlighted at the end of quarter three, were fully settled by year end. It closed December with $173 million of cash and did not pull any liquidity management or working capital management levers at the end of FY25. The $173 million cash balance is therefore fully available to the business and there has not been a large outflow of any cash in JAN unwind any such short-term initiatives. On 1 December, we fully drew the new $265 million 9% ABL facility and repaid the O3 credit facility in full. The ABL has no earnings governance for the first two years and does not contain any hair triggers that can result in review events, defaults or mandatory prepayments. It represents long-term debt committed in the business for five years at competitive rates, which is provided by Stanwell, with whom we have material common interests regarding Queensland's energy security and the regional blackwater economy. Our high yield notes only mature in 2029, and we therefore have no near-term debt maturities, which allows us to continue to focus on running our operations. The recent reset of the Stanwell arrangement brings forward the originally expected FY27 It waives the remaining AXA rebate for FY26 and the early part of FY27 and establishes a prepayment mechanism when liquidity is below $250 million. This puts Coronado in a better liquidity and cash flow position than that originally expected for FY27. Depending on prices and Stanwell's nominated tonnages, this will add approximately $200 to $250 flow in FY26. This is in addition to the approximate $400 million ABL and prepayments provided in FY25. The extent of this support clearly recognises Coronado's common interest with Stanwell and the importance of the company's contribution to Queensland's energy security and broader economy. It provides a material capital structure and liquidity underpinning that protects cash flow when liquidity levels drop below $250 million. In FY26, we'll continue our disciplined cost control. We'll have lower capital expenditure too. We'll benefit from a full year of volumes from the expansions that are in steady state. Cash flow will benefit from the latest Stanwell agreement. To improve market conditions and continuing work on minority disposals, We'll focus on improving the capital structure by reducing debt while at the same time providing shareholder returns. We'll also ensure that we have liquidity contingency plans in place, ranging from liberating cash from cashback guarantees when our credit rating improves, factoring and unsecured short and longer-term prepayments for coal if temporary liquidity buffers are required. We'll be releasing our financial results for 2025 and 2026 guidance to the market on 24 February 2026. With that, I'll hand you back to Douglas for the market outlook and closing remarks. Thanks.

Thanks, Barry. So in quarter four, the PLV hot coking coal Australian index averaged $200 a tonne, with prices rallying sharply from October through to mid-December and reaching $218 a tonne late in the quarter. That was a high since July 2024, and as we entered 2026, prices continued to strengthen. Supply side factors drove much of the price increases. The wet weather in Queensland in December, and that continued into January, and ongoing mining inspections and enforcement activities in China during October and November, and broader trade flow constraints, including the pace of Mongolia border clearances. With the March quarter, we expect prices to remain supported by firm India demand, seasonal Australian weather risk and continued supply rationalisation. Coronado's footprint across Australia and the US positions us well as global trade flows continue to shift. The US changes in tariff structures and steel sector policies are reshaping traditional export pathways, putting greater pressure on the high-cost producers. In this environment, our low-cost Buchanan complex remains competitively placed with flexibility to serve non-European markets, while our Australian operations continue to benefit from strong demand. At the same time, the high vol segment in the US remains structurally challenged, narrowing market access for operations like Logan and underscoring the importance of maintaining portfolio optionality as trade patterns evolve. Over the medium term, Our outlook remains positive as steel production outside of China recovers and trade policies continue to favor markets across several regions. In this environment, Coronado is well-placed to benefit from price changes to our higher production from our expansion projects and structurally lower cost base and increased operating predictability. Together with the Stanwell Reset, and restored liquidity, these factors position us to convert price momentum into stronger earnings and cash generation. With that, I'll hand over to Darcy and we welcome your questions.

Thank you. If you would like to ask a question, please press star 1 on your telephone and wife your name to be announced. If you would like to cancel your request, please press star 2. If you are on a speakerphone, please pick up the handset to ask your question. Your first question today comes from Rob Stein from Macquarie. Please go ahead.

Hi, Sam. Just obviously the fatalities in the last month or so, no-one wants to see, and I'm guessing there are lots of activities going on behind the scenes to understand the root cause towards those fatalities across the US and Australian operations. Can you share with us, especially in the case of mammoths, what initial learnings are, how confident are you that the risks can be managed and operations can return back to normal?

Well, thank you. There are tragic incidents that occurred and unfortunately both of these are subject to investigation so one needs to be careful what is communicated but also stick closely to the facts when talking about them. Let me say this, the Logan incident, the operations have returned to normal works and there are no constraints on the operations post the incident and that investigation will be ongoing outside of the ops. With the incident that's occurred here in Australia, investigations are ongoing. There is a milestone date, 20 days after the incident, which we're still within, to submit to the regulator, which is called the Section 201 investigation report and that the operators of Mammoth Mine will be submitting to the regulator and then post that we'll be able to talk more about that incident. I can assure you that all efforts have been made by us as demonstrated in the past that these tragic events get the benefit of the full focus of the business and all the earnings that we can get from it. or shared with the industry as quickly as possible to prevent future incidents where learnings can be drawn.

Sorry, as a follow-up, you know, is there any, I think in your report you said you did quite uplifts of, you know, that car related to mammoth and continued cost improvement expected in 26. Are we expecting, you know, based on that commentary that, you know, following that 20-day deadline or milestone date, that operations will resume and that they'll ramp back up to close to 100% of the trajectory they were on prior to the incident?

Well, if you don't mind, I want to break your question into two pieces. One is me setting a date of when the regulator will lift the directive that we have... We're allowed to enter the mine, we're allowed to do all other works except coal-winning works at the moment. That directive is public and you can read it. So works is ongoing in the mine other than coal-winning at the moment with the team. With regards to regulator lifting the directive, that's between the coal mine operator, the contracting company that we've appointed to do the work, and them, and we are clearly very interested and involved in the investigation. and ensuring that we return to work safely as soon as possible. With regards to MANA's capacity to ramp up after the event and keep operations going, I foresee with my experience no reason why once directors have lifted that operations will return to our planned production rates from that mine.

Thank you. I'll pass it on. Appreciate the colour.

No worries.

Thank you. Your next question comes from Glyn Lawlock from Baron Joey. Please go ahead. Morning.

Sorry, I just don't quite understand the answer to the question before on mammoth. So is there a set date or is it just the negotiation between the contractor and the safety regulator? So this could go on longer?

In short, yes. There are milestones that under the law you need to comply with as a coal mine operator and as I said, the contractor in this case is the coal mine operator. You've got a milestone date to submit an investigation on the Act which is called a Section 201 report and we're still within the 20 days that that is due for submission. So that is the milestone that I'm referring to but then it's between the regulator who has issued the directive to determine the lifting thereof. And that's obviously working through that we can demonstrate our controls are appropriate to ensure safe works.

Okay, that's much better. So, yeah, it's between the regulator and the contractor and how long is a piece of string. Thanks for the clarification. Maybe could you just talk a little bit to the status of discussions, I might have missed it, with the Queensland Government over whether you need to cash back the Rehabilitation Fund for Currah. What's the status there? Thanks.

Then I'll say a couple of things. One is how the world has changed. So obviously the state regulators got an obligation to do their determinations which they did last year. A lot of what the assessment is based on, if you go look at the framework that they obliged to work within, was based on rating agency determinations and then the scheme manager has discernment We've met with them, we've shown them our modelling, we've shown them subsequent to their discernment, so this is really important to pull out. They made their determination on what was information at a certain time, post that we could only make public to them the deal that we struck with Stanwell, we met with them subsequent to that again and even this month we provided them further information to support importance of Currah to Stanwell and Queensland's energy sector and our liquidity improved strategies that have all been delivered, that we committed to them have now all been delivered and our improved position. So they're now working through that information that we've given them and we're looking forward to their reported outcome.

Again, is there a timeline for a resolution or at least a ruling?

Yeah, they have indicated to us that within their framework and always there's outs within that, it will be in the month of February.

February this year, okay. And if I could squeeze in a last one, I was interested in your comments around the high-volume met coal market and the issues that Logan faces now with uncertain pathways, both domestically and export. Where does that leave you with Logan then now? You know, is it formally up for sale or what's your thought process? Because you obviously talk about, obviously, other ways to unwind the debt structure of the business.

Ben, as you know, you track this. I read a lot of what you write about it. So you're as well informed or if not better informed than anybody. The high-volume market is in oversupply in the United States at the moment. US market is talking about reduction in their steel, domestic steel production this year and next. What's happening with tariffs and threats around tariffs is impacting the Canadian market. So there's a lot of fluidity in the negotiations that are ongoing in the US at the moment. There's a few producers that have recently spent a lot of money bringing long-haul operations online that produce high-vol A and B and are looking to place that into the market. With the work that the team has done over the last three years, as you can see in the results we're speaking about today and the capital investments behind us, and particularly the standalone reset, we're now in a fortunate position to pivot to margin and ensuring that we drive good margin out of the business. And that includes us looking at our portfolio of products that we produce and looking at where do we employ our investors' capital into the future for the best sustained return. Now, Logan does have contracted tons that we committed to and we'll continue working towards, and we will be reviewing all of that as part of our strategic plans.

Okay. All right. Thanks very much, Douglas.

No worries. Thank you. Once again, if you'd like to ask a question, please press star 1 on your telephone and wait for your name to be announced. Your next question comes from Daniel Roden from Jefferies. Please go ahead.

Hey, guys. Thanks for taking the question. Probably just wanted to start with, I guess, the cyclone Koji impacts there and, I guess, how, you know, you outlined that you have, you know, better weather initiatives that have set the operations up. Like, you know, are you currently through a lot of that? Are you still seeing impacts from the operations? And are you able to split or define what inventory level you have at both of the sites and if any of that inventory is ported up?

There was a little bit of noise on the line so please forgive me if I get it precisely wrong and don't hesitate to correct me. I think your question related to cyclone Koji and our response to it and what's changed that I can speak to the improved response. There's a whole host of things that have changed at Curragh over the last three years in executing this plan. Primarily, if you start back in the operations, our pre-strip situations, particularly in our northern mine, which is dragline-dominated at the moment, with two draglines in the north, two draglines in the south, we've got good coal recovery and near coal that is available for mining operations. When you have a weather event like that, you have increase of water into the mine, it takes you a bit of time to pump the water out or move the water somewhere else and then clean. We fortunately had coal that was high. We could get back on production relatively quick. The other resilience to wet weather going forward and it's an adjunct to the Mammoth is we have coal that's been mined from underground now that is stockpiled that we can move to the operations. Now clearly Mammoth isn't operating now but we did have stockpiles of coal that we've got access to and structurally changed to cover long term is this augmented coal flow. It's an added benefit of Mammoth. It's not only a lower cost It's a different mining method that de-risks it. And then also our inventory positions that we have. If you look at our sales volumes at the back end of last year, a little bit in the US as I mentioned, but particularly in the Australian area. Raining in Australia was a challenge for most people on the Blackwater line, above rail providers had a whole host of issues that cancelled trains. We had to pivot our strategy through back end of November, early December. around what we moved to port and you'll see in the results that we focused on moving met coal to port and honouring our shipments to our clients and we worked with Stanwell on product being available at the mine and ensuring that we got it to the power station for them, but we ended up with very large reserves of inventory, ROM inventory and port inventory and site inventory in particular. of product build-up. So unfortunately we didn't get all the sales we wanted, but some of that has played to our hand at the moment and that's why I say we versus others that had to call force majeure, we didn't have to do that because we could meet all our MET commitments at the back end of last year and then we had these inventories either in ROM or product that we could keep shipping. The main thing is the mining method across Currow is a lot more stable than what it has been in the past. It's taken us a few years to address things like pre-strip deficits, get pit configuration sorted out, getting pumping in-pit and ex-pit results, which has set the mine up to be a lot more resilient and be able to respond to events like this better than in the past. So all of that, I think, has answered your question. I hope I heard it correctly and tried to cover most faces very quickly.

Yeah, no, it hasn't. Apologies for the line before, but no, thank you. And maybe just a clarification there. So there is port side inventory. You'd expect to destock some of that, but that might not be all in Q1 and you could see some of that destocking in Q2. So some of that working capital might still be neutral in Q1. You might see that outflow further in, you know, towards the end of Q1 or Q2. Is that a correct way of classifying it?

Yeah, look, our rail has been impacted with cyclone at the moment. Above rail providers and actually below rail providers restricted the number of trains that flowed in the first half or back half of January through this event and probably a little bit restrictions into Feb. But we've still been able to get the product to port for our clients. And then importantly, as Barry made a point of as well, we've got a major shutdown on our prep plant at Currah. for two weeks where we're doing some upgrade works to make it more reliable and get better yields out of the system because we've moved the bottleneck there. In that period we've been able to move quite a bit of product to the power stations and then also move what we have at site or the remainder of what we have to port and ensure that we meet our obligations. So we don't see much tipping over into the second quarter but it will all be in our committed sales for the first quarter.

Okay, no, thank you. And maybe just to follow up on, I guess, working capital as well, you know, I can read also that you mentioned working capital charges outstanding will be cleared in the December quarter. I was just wondering if there's any, I guess, you know, are there any outstanding payments or obligations? You know, are you expecting any future working capital, I guess, changes in the near term, specifically, you know, first half 26th?

Daniel, thanks for that one. So as I said, at Q3, we pulled that working capital lever quite hard due to the cash and liquidity position. That's all unwound. It's all settled. So the $173 million at the end of December is real cash. It's available. There's nothing to be caught up from that. year one, obviously with cyclone impact, fatality impact, we'll be drawing down, especially in Australia, we'll be drawing down on working capital. There'll be a bit of an inflow of cash, but then as we have the shut, as Douglas explained, I think we'll build up working capital again and then I would think by end of March it should all flush through. So as we sit here currently, I don't expect a big working capital impact

in in q1 if we execute the the plan as we've got it yeah perfect and sorry uh last one for me but the the 200 and 250 million dollar liquidity that you've called out for 26 are you able to i guess separate that into uh you know what proportions from the i guess waiver um and what proportions from the prepayments and and you know what what conditions um of you know outside of the financial conditions What are the conditions that you would need to see to draw down on that from, you know, your perspective and Stanwell's perspective?

Yep. So, I mean, the rebate forgiveness does depend a bit on what the full price is, you know, so that the revenue line drives that. But roughly I'd say, you know, you can say that the rebate forgiveness put that at 100 million and then the rest is the prepayments. The prepayment obviously happens. It's an automatic trigger depending on our cash balance. If the cash balance is below $250 million, then we get half of the total benefit. If it's below $200 million, we get the full benefit. With the full year results, we'll give a bit more detail as to exactly how that gets calculated. But as we sit here today with a cash balance of $173 million, we'd be entitled to that full benefit of the cold prepayments for every ton that goes to Stanwell. We'd basically be getting paid $90 a ton, as opposed to the $40, $30 a ton that's in the EXA. And then when you cross over $200 million, kind of that margin halves and so on and so forth. So that's kind of a rough idea, rebate 100, the cold repayment, the rest, automatic trigger that kind of, that kicks in depending on our cash position.

Yeah, perfect. I really appreciate your answers. I'll hand it over. Thank you. Cool.

Thank you. Your next question comes from Lachlan Shaw from UBS. Please go ahead.

Yeah, good morning, Doug and Tim. Thanks for your time and thanks for taking my question. I wanted to, I guess, congratulate you on where you've got CARA in terms of the One CARA Plan long time coming, but I wanted to also just sort of ask in terms of how we think about going forward, Is there more to come? Are you done? You've had three-quarters of sort of stable, pleasing cost performance. What more can be done sort of on a go-for basis, obviously, outside of additional volumes once Mammoth resumes?

Thank you. It talks to the strategy for the business. And, look, you're right. We did in 2022 set about a disciplined plan that required – amount of engineering time and money to be spent to turn the ship, but the results are there. You can see Currah has turned the corner and now it's set up to be a low-cost dragline operations augmented with the underground. There is upside to the plan. As we've been saying all along, there is a Mammoth 2, which is probably two continuous miners that we can expand, and we've taken that to BFS phase, and we'll pause that for the near term because we want to obviously deal leverage and strengthen our position as we enjoy the pricing at the moment and enjoy our low cost base for a period of time. But there's upside position there and then there is a twinkle in my eye with another underground mine. As these mines in the Bowen Basin age, their stripping ratios go up and having an underground capability that you can still extract a really valuable resource and leverage all the invested infrastructure longer term. going underground is sensibly a very attractive proposition. So we're looking at a few other options there, but not for now. Our for now focus in 26 is improving margins. So what we'll be doing, the biggest thing at Currah is what we're doing in February is the prep plant upgrades. Now, all the long lead items for that upgrade was bought in 25. So it'll be the works that get executed over the next two weeks or so in February that will give us better reliability and then improve some yield on some of the products that we produce, just replacing old technology with newer technologies. So that'll be the biggest and then we're going to be looking at our mine plans for everything where the Stanwell mechanism drove us in the past, particularly because of the rebate situation that we chased incremental tonnages to try and get on the right side of that calculation of it to margin-driven tunnels. and that'll be our focus for the next while. So moving towards let's get the most that we can out of every tonne relevant to what the market is offering us in the near term.

Great, thank you. That's really great, Kala. And just my follow-up question. So I might have missed it. Apologies, I was late on the call. But with Mammoth and, I guess, remediation, I understand there's a question there of just waiting for directive outcomes from the regulator. Do you anticipate any sort of ongoing kind of increases to OPEX that might flow there from, for example, additional roof stabilisation measures or such measures you might need to take? Thanks.

I don't want to speculate too much because the investigation is ongoing. I must just call up, we're not waiting for the regulator nor is the regulator just waiting for us to put in our report and then submit. We are working very constructively with the regulator and I must commend them, them and the unions for the maturity and the professionalism displayed during this incident. I'll do a couple of things. One, treat the respect of the person who lost their life, Jeff. their family, but then also all the teammates who have worked very diligently to build a world-class operation in Mammoth that they're all very proud of and make sure that they learn from this and move on. So I thank all of them. And that collaborative approach is ongoing where our accountability is all owned. Everybody's working towards a couple of goals. Let's learn from this and ensure that we share it with the industry. And the other is the best thing for Mammoth and all its people and all agencies agree to this is getting back to work as quickly as possible and as productively as we can. Impact on additional support and changes, I don't want to venture there until we have a report out coming. Let me say this, that I do not see that kind of change being material to the way in which we think about Logan's operations into the future in any of that that's coming up.

Got it. That's clear. Thank you. Thanks again, guys.

Thank you. Once again, if you would like to ask a question, please press star 1 and wait for your name to be announced. Your next question comes from Chen Jiang from Bank of America. Please go ahead.

Good morning, Doug and Barry. Thank you for taking my question. First question, your U.S. domestic coal sales, which is close to one-third of your U.S. coal sales. I remember Coronado used to provide the market with the fixed price, which negotiated with your customer for the next two months. Has that changed for 2026? Because I haven't found any U.S. domestic coal prices fixed provided in today's release. Thank you.

Chen, no, not necessarily. We're just still in the middle of some of those negotiations and we don't want to pre-empt or prejudice our clients as well with sharing information that we shouldn't right now. So when it's appropriate, we'll talk about what the domestic is for Buchanan and Logan into the future.

So you are still in negotiation with your customer for whatever forward price should be for the U.S. coal for the next two months?

Yeah, I don't think I know. I read some of your stuff as well. You guys watch that market and understand that highball market very closely. What happened around tariffs and U.S. steel ownership and that negotiations were delayed last year. And then over the Christmas break, we're delayed even further. And then with what's happened between the US and Canada and some other trade threats and relief and change, a number of parties have stood on the sideline and just waited to see what exactly the label angle is going to be before they commit. So some of that has and continues to impact some of those domestic negotiations. I will say, as I hinted at earlier, and it is public Some of the producers who have built long walls of this type of product and just made major investments into long walls producing these products have gone early and secured domestic contracts, but obviously they've got a capital base they need to support. We're not in that situation with Logan. So we're making sure we pick the best opportunities and make the decisions that drive our best outcomes for the business.

Sorry, one thing to just add to that is that obviously you've got, you know, U.S. operations important to delineate between the Logan IVOL and the Buchanan more premium product space.

Yeah, yeah, sure, sure. Thank you. And then can I have a follow-up, please? Second question on your potential minority asset disposal in the release, are you still exploring that option, because the MECO price is sport, POV, hardcore eco, $250 per ton. So I'm wondering, under the scenario, if current sport stays for the rest of the year, or even for the next year, is the minority asset disposal still under your plan? What's the thinking, if you can help me to understand why that is still part of your plan?

Thank you. Yeah, so the board has still given me and the team a mandate to look at minority sales. Obviously, we had to do a lot to our balance sheet last year to get through a very difficult year. I think it's evident in the numbers. So we want to deleverage the business. We have great assets and we've got lots of people that are interested in being part of those assets going forward. But as you called out, the world is pretty different. Pricing has improved. We are a very different business. Our capital projects are now behind us. They're fully de-risked and clearly by what we've spoken about today, the run rates delivered in the fourth quarter, they are delivering. And like Buchanan, they generated $20 million in a month in December and is having another good time this month, frankly. we will make sure that we get maximum value for our shareholders. So we will consider where we're at, where the market's at, and our balance sheet and options to strengthen that versus asset sales. But I will say we've had strong interest. We're well-progressed in our discussions with parties on that minority sale.

Sure, I understand. Can I ask you a last question? Because you mentioned that the leverage and also in today's release mentioned... So I'm thinking looking at your senior debt, US $400 million, and then you have Stanwell facility, $265 million. That's altogether in total US $665 million, which is still higher than your current market cap. If you can help us to understand your plan, if there's a need to deliverage balance sheet over the, I guess, more medium-long term, if the small price stay for the next quarters or years, and how you are going to do that, given the agreement with Sunwell is in exchange of the thermacle sales. Thank you.

Yeah, Chen, that's very good. I mean, I think that the way we'd look at it, obviously, so if prices hold and stay where it is and it lasts for a year or more than that, Coronado is very well set in that regard because our operational leverage is extremely high. The business will generate a lot of cash. I think that the way we go about it will be to build cash against the debt. Even though we can choose to repay that AVL with Stanwell and prepay it, I think that manage liquidity, one would rather keep the flexibility and build up cash and keep the gross debt, and then deal with those debts as they come up to maturity. I think when we speak about Shell, the returns in that sense, I think in the first instance, deleveraging you know, would cause the equity to respond because I think the company's enterprise value is intact and is in a good place, but there's a lot of debt that makes up that enterprise value as you rightly remarked this. Look at the market cap, the debt and the equity value is kind of approaching parity now. So one would think as you build cash against the debt that you'd see an uplift in the equity. So that's quite simply, I think, what we... what we target. In terms of the minority sales earlier, if as Douglas said, we can find a suitable transaction with the right value, that will help us accelerate the leveraging and get us on the front foot as opposed to just doing it through operating cash flow as and when we generate it. Great.

That's very good, Carlos Barres. So to clarify, I guess the plan from here is just to building up cash. and then how we should look at it is the net day rather than total day because total day is still relatively high and then the maturity is very, very long-dated, probably 2027 onwards. Okay, that's very clear. Thank you.

I think that's what you do in the first instance to just preserve your liquidity position. If our high price continues for the second and the third year, then... I think you'd start looking at kind of how do you do a more comprehensive balance sheet refinancing that maybe resets maturities and kind of cost of debt and those things. But I'm conscious that, you know, it's two days of PLV above 250. So as long may it last.

Yeah. Okay. Thank you so much. Thank you. I'll pass down.

Thank you. This concludes the question and answer section of today's call. I'll hand back to Douglas for any closing remarks.

Thanks, Darcy. As Barry said, long may it last above 250. For a team to set about a multi-year plan to improve a business takes discipline and resilience and focus. And I am... very proud of and very grateful for the people in our business that have demonstrated the resilience and consistency to ensure that we made real progress in these plans that we can demonstrate and set the business up for long term and the celebration of the important milestones in this plan along the way. And while that all occurred and while we focus on the plan, we obviously went through some very difficult times last year as a business and the team stuck to the plan. and they delivered it to ensure that they set the business up now for the future to enjoy the market that we're now talking about, as Barry said, long may 250 last. So with that, thank you very much, everybody, for joining today on the call. And if you've got any further questions, please do not hesitate to reach out to our Investor Relations team. As you know, Chantal is always happy to help you understand for modeling reasons and the like.

That does conclude our conference for today. Thank you for participating.