Arch Resources, Inc.

Good morning, and welcome to the Arch Resources, Inc. second quarter 2024 earnings 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 remarks, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Dex Sloan. Please go ahead.

Good morning from St. Louis, and thanks for joining us today. Before we begin, let me remind you that certain statements made during this call, including statements relating to our expected future business and financial performance, may be considered forward-looking statements according to the Private Securities Litigation Reform Act. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. These uncertainties, which are described in more detail in the annual and quarterly reports that we file with the SEC, may cause our actual future results to be materially different from those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required by law. I'd also like to remind you that you can find the reconciliation of the non-GAAP financial measures that we plan to discuss this morning at the end of our press release, a copy of which we have posted in the investor section of our website at archrsc.com. Also participating on this morning's call will be Paul Lang, our CEO, John Drexler, our president, and Matt Gilgium, our CFO. After our formal remarks, we'll be happy to take questions. With that, I'll now turn the call over to Paul.

Thanks, Nick, and good morning, everyone. We appreciate your interest in ARCH, and I'm glad you could join us on the call this morning. I'm pleased to report, as I've heard in the second quarter, ARCH continues to drive forward with our clear and consistent plan for long-term value creation growth. Through the quarter of this end, the team achieved adjusted EBITDA of $60 million, set a quarterly production record in our core metallurgical segment, while driving ahead with the development of a second longwall district in the first half, where we expect substantially more favorable conditions. Shipped 2 million tons of cocaine coal, despite significant logistical challenges stemming from the tragic collapse of the Francis Scott Key Bridge. Paid down an incremental $13 million in debt, giving us a net cash positive position of $46 billion, and worked to right-size the operating activities in our thermal segment, setting the stage for cash generation at these operations in the back last year. In addition, in a particular note, we deployed incremental $19.6 billion in our capital return program during the second quarter, even in the face of the just-discussed logistical challenges and a subdued near-term market environment. We returned this capital through the repurchase of an additional 94,000 shares in common stock with an investment of $15 million and a declaration of a quarterly cash dividend of $0.25 per share, payable in September, with a total projected payment of $4.6 million to shareholders. In aggregate, we've now deployed well over $1.3 billion in our capital return program since its relaunch, in February 2022, which we hope you'll agree represents a substantial amount of value generation in a relatively brief period of time. This total includes $732 million, $38.78 per share in dividend payments, and the repurchase of $615 million in common stock, as well as the repurchase and retirement of unconvertible notes. It's worth pointing out that, including the Q2 repurchases, we've now reduced our diluted share count by well over 3.5 million shares, or more than 16%, when compared to the level of May 2022. Looking ahead, we remain sharply focused on driving that share count down even further. As you know, a central tenet of our value proposition is to return 100% of the company's discretionary cash flow to shareholders, with a strong emphasis on share repurchases. We believe that this framework has created substantial value for our shareholders in the past, and we fully expect it to continue to do so in the future. Let's now switch to some brief commentary on the steel and coke and coal markets before turning the call over to John for additional color on our operating performance during Q2. As you're no doubt aware, seaborne coke and coal demand remains tepid due principally to our estimation to a challenging global macroeconomic environment related in part to weak infrastructure and property market spending in China. The predictable but nonetheless consequential effects of the monsoon season in India and the slow climb out from multiple quarters of economic stagnation in Europe. These factors have coalesced to weigh on global steel demand as evidenced by the recent erosion of steel prices. Hot coal prices in major steel producing regions are down approximately 50% versus the peak seen in 2021. As part of this, European steel markets are under pressure, with the average capacity factor of blast furnaces standing around 65%, according to our estimates. This steel market weakness has had the predictable knock-on effect on global cooking coal markets. Even with these pressures, however, customer interest in Archer's high-quality cooking coal products particularly in Asia, continues to thrive. Asian steelmakers appear increasingly focused on identifying strong, consistent, and long-lived sources for their long-term cooking coal requirements, given their own expansion plans, in order to buffer themselves from a lack of new investment in the cooking coal supply space. Given the number of customer inquiries over the last couple of months, we expect to have ample opportunity to continue to build on our global customer base, with a strong Asian emphasis that represents a good strategic fit with our high-quality assets. Meanwhile, the cold and cold supply side of the story remains muted, reflecting degradation and depletion of the resource base and major supply regions. Only modest investment in new and replacement mine capacity. Recent mine outages that have removed 2% to 3% of supply from the global seaboard market and an increasingly fragile supply chain. Moreover, we believe that the current cooking coal prices are below the marginal cost of production on a global basis. We at Chief Acura will take a predictable toll on production models over time, assuming such prices persist. As a result of these various factors, we expect seaborne coal and coal markets to balance quickly once the global economy begins to strain and global steel demand starts to reassert itself. Looking ahead, we remain sharply focused on driving continuous improvement and execution across our entire operating platform in support of strong, value-generating capital returns for our stockholders, even in today's soft market environment. With our cost-competitive Coca-Cola portfolio, high-quality products, and rapidly expanding presence in Asian markets, and recognized sustainability leadership, we believe we are exceptionally well-positioned to capitalize as global steel demand stabilizes and then returns to its anticipated upward growth. With that, I'll turn the call over to John for further discussion on our operational performance in Q2. John?