Ramaco Resources, Inc.

Good morning and welcome to the Ramico Resources First Quarter 2024 Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you can press star, then one in your telephone keypad. To withdraw from the question queue, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Jeremy Sussman, Chief Financial Officer. Please go ahead.

Thank you, Operator. On behalf of Ramico Resources, I'd like to welcome all of you to our first quarter 2024 earnings conference call. With me this morning is Randy Atkins, our Chairman and CEO, Chris Blanchard, our Chief Operating Officer, and also in the room is our new VP of Marketing and Analysis, David Dyer. Before we start, I'd like to share our normal cautionary statement. Certain items discussed on today's call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent Ramico's expectations concerning future events. They're subject to risks, uncertainties, and other factors, many of which are outside of our control, which could cause actual results to differ materially from the results discussed in these forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. Except as required by law, Ramico does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. I'd also like to remind you that you can find a reconciliation of the non-GAAP financial measures that we plan to discuss today in our press release, which can be viewed on our website, www.ramicoresources.com. Lastly, I'd of course encourage everyone on this call to go onto our website and download today's investor presentation. With that said, let me introduce our chairman and CEO, Randy Atkins.

Thanks, Jeremy. Good morning to everyone, and thanks for joining the call. Our first quarter results were, of course, below our expectations. We printed 24 million of EBITDA in Q1 against twice that amount in Q4. Jeremy will go into detail on the financial metrics, but a main driver was lower realized prices. They dropped by over $55 a ton, or almost 20% since Q4. This particularly hit us in March when we shipped almost 50% of our Q1 export business, which was index price. We also dealt last quarter with mine cost issues at Elk Creek from both tough geology and labor conditions. I'm confident that our results will improve throughout the year. This will come from a combination of continued production growth, greater cost discipline, and improvements in productivity. With that expectation in mind, we have continued to maintain our current guidance for the year. As I said in our earnings release, there are parallels with our somewhat bifurcated performance in 23. Last year, we were both a different and much larger company in the second half of the year. Why? Essentially, we grew by 33% from three to four million tons of annualized production in the back half. 2024 looks like it may play out in very similar fashion. We now expect to ramp current sales and production by an additional 1 million tons, or 30% by Q4, and in the year at basically a 5 million ton run rate. We will reduce CapEx in 24 by 30% against 23 numbers. In the balance of the year, we will also see a meaningful cost reduction back to guidance levels from a combination of new production and better mining conditions, as I will briefly note in a moment. Later, we're also going to talk in detail about each of our four near-term production growth initiatives. All of them are currently on track on both timing and budget. In a brief summary, at Elk Creek, we will add roughly 600,000 tons of additional annualized production from the RAM number three surface and high wall mine, as well as a new third section to the Stonewall Alma mine. Both ramp up by the mid-year, And these mines will be in thicker coal cost, with cost rather, estimated at approximately $90 to $95 a ton. In the main Berwyn mine, starting in Q4, we will add roughly another 300,000 tons of annualized low-vol production from adding a third section. That mine is now running with cost of approximately $85 per ton. and we're expecting similar cost metrics in the new section. Lastly, we are on track to have the Mabin Prep Plant fully operational before year-end. This will eliminate about $40 per ton of current trucking costs. So collectively, in the back half, we should be producing and selling on an annual basis of almost a million tons more. Importantly, this new production should have average mine costs well below $100 per ton. When this is combined with productivity gains at our other mines, we anticipate overall cost will decline meaningfully in the second half. Our bottom line goal is to exit 24 at or below $100 per ton cash cost and produce and sell at almost a 5 million ton annual rate. This is now baked into our full year cash cost guidance of $105 to $111 per ton. On a rare earth element business, since we last spoke last quarter, we have moved forward on a number of fronts. In March, Weir International issued an updated technical report on our exploration target. Both the rare earth volumes and mineral concentration estimates basically doubled from the original report a year ago. We are currently drilling more cores at deeper depths and also mining larger test samples. As we do, we anticipate these numbers will get larger. There are two matters on the rare earths I'd like to note. There are a number of deposit lithologies that showed maximum part per million concentrations exceeding 9,000 ppm. This includes coal. Also, 10% of the deposit is now estimated to contain two high-value critical minerals called gallium and germanium. These are used in semiconductors. Both were banned from export by China last year. We are now estimated to have one of the largest natural supplies of these minerals in the U.S. On the back of the new WEIR report, in April, we held our first inaugural investor REE conference call with both the buy and the sell side. We would like to thank nearly all of the 200 people who participated, who were both a lot of new and many familiar faces. We are continuing to progress at the Brook Mine in terms of developing the geological assessment as well as the chemical and preliminary separation analysis of the REs. And we still expect completion of our techno-economic analysis later this year. Switching gears, in terms of the overall MET market, Jeremy will touch on some detail in his remarks. However, MET call prices, as I said, fell by roughly $55 throughout the first quarter. In March alone, the drop accelerated by $30 a ton. As I mentioned, unfortunately, March was when we had the majority of our first quarter export shipments. This price decline was largely on the back of muted seasonal buying influences, which we've now seen occur in Q1 for the last three years in a row. Some good news, however, is that pricing appears to have stabilized once again at levels similar to last year's lows. On the demand front, we have recently seen increased buying activity from several of our Asian customers. On the supply side, overall coal production is down in cap year-to-date, with southern West Virginia down about 14% and Virginia down about 21%. This decline is reflected with the recent closure of some higher-cost mines near us that are frankly losing money at current price levels. One silver lining of these closures is that the labor markets seem to have stabilized. As a result, our hiring has picked up and wage pressures seem to have declined. Although the met markets are always driven by macroeconomic factors, we're optimistic that the back half of the year may show some resiliency in both demand and pricing. There are a number of factors which we expect may lead to this rebound. In a nutshell, Chinese domestic steel demand has been weak this year, which caused them to increase their steel exports, and that supply glut has led to lower steel prices across the region, which in turn has squeezed margins across the whole supply chain. As we know, China has been in a shift toward building out energy transition and consumer-related industries at the expense of less spending on traditional real estate and infrastructure. Looking forward, however, there are reasons to expect that the Asian steel markets may rebound in the second half of the year with a corresponding uptick in overall met coal pricing. First, in China, there's a growing expectation of improving downstream demand due to recent project funding via accelerated bond issuances. In addition, India has progressively had a larger role in impacting the global MET business. This may be equal or even greater than Chinese market influence as we move forward. And one aspect of this influence on the markets we've seen is that now both India and China's seasonal buying patterns have more weight on price. As an example, China seems to be a more aggressive buyer in Q4 for their Q1 construction activity, and India seems to restock ahead of the monsoon season in Q3. Also this year, Indian elections are taking place this quarter, which has added to softer infrastructure spending. Note there's a prohibition of approving new infrastructure projects during the election season. So this adds another impact. Therefore, we view India's recent demand pullback as somewhat of a seasonal one. And post-election, we expect an uplift beginning in July. So to step back against this backdrop of international demand, we couple it with a forward muted supply picture from the closure of some higher cost mines in the US and continued production issues at some of the older Australian mines. This leads us to feel some optimism that we may see both demand and price pick up in the second half. Indeed, as I've said over the last few weeks, we have seen some increased sales interest from our Asian customers. And we should also not discount the knock-on demand impact if the U.S. economy shows some strength in the back half of the year. We expect this might come from the combined impact of spending rollouts from the multiple fiscal stimulus packages passed last year and the resulting onshoring or reshoring of related energy transition projects. Lastly, on our financial front, we recently closed an agreement to increase both the size and the term of our existing revolver with a key bank led syndicate. This facility takes the basic size of the revolver from 125 million to 200 million. It has an additional 75 million accordion feature which increases the ultimate size to $275 million. We also extended the term from three to five years until 2029. As we look to our production and sales growth over the coming years, we appreciate now having the flexibility of a larger facility to basically meet normal working capital requirements. And I want to thank especially KeyBank as well as our syndicate members for their long and continued support of Ramico and all our overall growth initiatives. I view the closing of this upsized facility as a validation of our longstanding strong credit culture and conservative balance sheet. In line with that, I would note that over the course of 24, we will continue to pay down the term debt we had at the end of the year, as Jeremy will detail in a moment. And with that, I would like to turn the floor over to the rest of our team to discuss finances, operations, and markets. So Jeremy, please begin with a rundown on our financial metrics. Thank you, Randy.