Natural Resource Partners LP

Thank you for standing by and welcome to the Natural Resource Partners LP third quarter 2020 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star 0. I would now like to hand the conference over to Tiffany Sammis, Manager of Investor Relations. Please go ahead.

Thank you. Good morning and welcome to the Natural Resource Partners third quarter 2020 conference call. Today's call is being webcast and a replay will be available on our website. Joining me today are Craig Nunez, President and Chief Operating Officer, Chris Zolas, Chief Financial Officer, and Kevin Craig, Executive Vice President of Coal. Some of our comments today may include forward-looking statements reflecting NRP's views about future events. These matters involve risks and uncertainties that could cause our actual results to materially differ from our forward-looking statements. These risks are discussed in NRP's Form 10-K and other Securities and Exchange Commission filings. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. Our comments today also include non-GAAP financial measures. Additional details and reconciliations to the most directly comparable GAAP measures are included in our third quarter press release, which can be found on our website. I would like to remind everyone that we do not intend to discuss the operations or outlook for any particular coalesce or detailed market fundamentals. In addition, I refer you to General Resources public disclosures and commentary for specific questions regarding our Soda Ash business segment. Now, I would like to turn the call over to Craig Nunez, our President and Chief Operating Officer.

Thank you, Tiffany, and good morning, all. NRP continues to operate under CDC guidelines, government-imposed rules, and company remote work protocols. Our employees are safe, and the partnership is conducting business as usual. Our management succession plans and delegations of authorities are in place should we need them. Demand for steel, electricity and glass began to rebound in the third quarter and the outlook for our coal and soda ash businesses has improved. However, we expect markets to remain volatile as a result of ongoing uncertainties with the COVID-19 pandemic. We continue to generate free cash flow and maintain strong liquidity. We generated $95 million of free cash flow over the last 12 months and paid off $46 million of debt. Our cash flow cushion, which is the free cash flow remaining after paying our private placement debt amortizations and distributions on our common and preferred units, was $1.5 million. We ended the quarter with $216 million of liquidity consisting of $116 million of cash and $100 million of unused borrowing capacity. Metallurgical and thermal coal markets have shown improvement from their second quarter lows, and we expect this will benefit our lessees going forward. As mentioned last quarter, we worked with Foresight to help them develop a plan to emerge from bankruptcy. and we entered into lease amendments pursuant to which Foresight, which represents over 70% of our thermal coal revenues, agreed to make fixed payments to us totaling $49 million this year and $42 million next year. We began to see the benefits of those amendments in the third quarter. The fixed payments provide cash flow certainty for NRP at a level greater than had been anticipated as the coal industry manages through difficult market conditions Thank you for joining us. Reducing operating expenses, delaying large capital expenditures, negotiating additional covenant headroom on its revolving credit facility, and finding new customers. Despite these positive developments, we do not expect Jenner Management to resume cash distributions from Jenner Wyoming until they have greater visibility and confidence in the sustainability of the continuing improvement in global soda ash demand. Chris? Chris?