SunCoke Energy, Inc.

followed by one on your telephone keypad i'm now going to hand over to shantanu agrawal vp finance and treasurer to begin shantanu please go ahead thanks jordan good morning and thank you for joining us this morning to discuss suncook energy's fourth quarter and full year 2023 results as well as 2024 guidance with me today are mike rippey chief executive officer catherine gates president and Mark Marinko, Senior Vice President and Chief Financial Officer. Following management's prepared remarks, we'll open the call for Q&A. This conference call is being webcast live on the investor relations section of our website, and a replay will be available later today. If we don't get to your questions on the call today, please feel free to reach out to our investor relations team. Before I turn things over to Catherine, let me remind you that the various remarks we make on today's call regarding future expectations constitute forward-looking statements. a cautionary language regarding forward-looking statements in our SEC filing applied to the remarks we make today. These documents are available on our website as our reconciliations to non-GAAP financial measures discussed on today's call. With that, I'll now turn things over to Catherine.

Thanks, Shantanu. Good morning. Thank you all for joining us today. Earlier today, we announced Suncook Energy's fourth quarter results. Before I turn it over to Mark to review the results in detail, I want to share a few highlights from 2023. I want to start by thanking all of our Suncoke employees for their contributions in achieving our 2023 objectives. The dedication of our team is evident through our strong operational performance and our financial results. Slide three lays out our key objectives for 2023 and how we performed against those objectives. We delivered consolidated adjusted EBITDA of $268.8 million modestly exceeding the high end of our guidance range of $265 million. Strong domestic Coke operational performance drove our results, while our logistics business faced headwinds due to challenging market conditions. We generated $138.9 million of free cash flow, exceeding the high end of our guidance range of $120 million. We continued to build on the success of our Foundry Coke business with the completion of the Foundry Screener project in 2023. This investment improves our handling efficiency and allows us to continue growing our foundry market participation. Our plants ran full in 2023 and we were able to successfully sell all non-contracted tons into the foundry and spot blast coke markets. We also extended our Indiana Harbor contract with Cleveland Cliffs through September 2035 with key provisions similar to the prior agreement. The renewal affirms our mutually beneficial relationship with Cleveland Cliffs and positions Indiana Harbor well for the future. We also made great progress on our capital allocation priorities in 2023. We deployed free cash flow to reduce our gross debt by approximately $44 million, ending the year with a gross leverage ratio of 1.86 times on a last 12 months adjusted EBITDA basis. We returned approximately $31 million to our shareholders having increased our quarterly dividend from $0.08 per share to $0.10 per share during 2023. We expect the continuation of our quarterly dividend throughout 2024. And lastly, we continue to work on the development of the GPI project at Granite City. With that, I'll turn it over to Mark to review our fourth quarter and full year earnings in detail. Mark? Thanks, Kathryn.

Turning to slide four. The fourth quarter net income attributable Sunco was $0.16 per share, up $0.02 versus the fourth quarter of 2022. Our full year 2023 net income attributable Sunco was $0.68 per share, down $0.51 versus the full year 2022. Tax adjustments of $0.29 per share recorded in the third quarter of 2022 and the third quarter of 2023 impacted EPS. primarily due to tax law changes in the U.S. and Brazil in both 2022 and 2023. Excluding the impact of these adjustments, EPS was lowered by 22 cents per share year over year, primarily driven by lower contribution margins on non-contracted blast coast sales. Consolidated adjusted EBITDA for the fourth quarter 2023 was 62.3 million, up 3.4 million versus the fourth quarter of 2022. The increase was primarily driven by higher cold to coke yields and favorable O&M recovery on long-term take or pay contracts from our domestic coke plants. Partially offset by lower volumes at CMT and higher non-cash legacy liability expense at corporate. On a full year basis, we delivered adjusted EBITDA of $268.8 million. down 28.9 million versus record results of 297.7 million in 2022. The year-over-year decrease was primarily driven by lower contribution margins on non-contracted blast coke sales, lower volumes in logistic segments, and higher non-cash legacy liability expense, partially offset by higher cold coke yields and lower employee-related costs. Turning to slide five to discuss the year-over-year adjusted EBITDA variance in detail. Our domestic Coke business operated at full capacity but was impacted by lower contribution margins from non-contracted blast Coke sales. This was partially offset by higher cold to Coke yields on long-term take-or-pay contracts. The domestic Coke segment delivered full-year adjusted EBITDA of 247.8 million modestly above our full year domestic Coke guidance range. Results from our Brazil Coke segment were impacted by the absence of technology fees, which expired at the end of 2022. Including Brazil, our Coke operations delivered adjusted EBITDA of 256.9 million. The logistics segment adjusted EBITDA decreased by 5.4 million year over year, driven by lower throughput volumes at CMT as a result of weak commodity market conditions. The logistics segment delivered full-year adjusted EBITDA of 44.3 million. Finally, our corporate and other expenses were higher by 2.5 million year-over-year, mainly due to higher non-cash legacy liability expenses, which were partially offset by lower employee-related expenses. Turning to slide six to discuss capital deployment in 2023. We generated very strong operating cash flow of $249 million during 2023, partially driven by the timing of favorable working capital changes, which allowed us to make good progress on our capital deployment initiatives. Capital expenditures came in at $109.2 million, which was above our guidance, mainly due to the timing of certain projects. We expect to see an offset in 2024 which is why our CapEx guidance of 75 to 80 million is lower than our normal run rate. We reduced gross debt outstanding by 43.8 million in 2023, with no outstanding balance on a revolver at year end. During 2023, we also returned capital to our shareholders in the form of a 36 cents per share annual dividend, which was a use of approximately 31 million of cash. As mentioned by Catherine, we increased our dividend by 25%, that is, from $0.08 to $0.10 per share during the third quarter of 2023. In total, we ended 2023 with a cash balance of $140.1 million and strong liquidity of approximately $490 million, setting the stage for continued progress against our capital allocation priorities in 2024. Now I'd like to turn to our guidance expectations for 2024. We expect Consolidated Adjusted EBITDA to be between $240 and $255 million in 2024. Domestic Coke Adjusted EBITDA is expected to be lower by $3 to $10 million, driven primarily by our expectation of lower coal-to-coke yield value on contracted blast coke sales due to lower coal pricing. We expect to continue running our Coke fleet at full capacity. Brazil Coke adjusted EBITDA will be flat to better by $1 million. As a reminder, the Brazil Coke facility is owned by ArcelorMittal Brazil, and Sun Coke provides the operating and technological services pursuant to an operating agreement. Logistics adjusted EBITDA is expected to be lower by 9 to 14 million in 2024. We anticipate lower volume in pricing at CMT year over year, driven by weak commodity markets. Lastly, we expect our corporate and other segment expense to be higher by approximately 3 to 5 million, driven by normalized non-cash legacy liability expenses. Moving on to slide 9 to discuss the domestic Coke segment in detail. In 2024, we expect our domestic coke adjusted EBITDA to be between 238 and 245 million, with sales of approximately 4.1 million tons, which includes contract, foundry, and spot blast coke. We expect to continue to run, running the full domestic coke fleet at full capacity. Approximately 3.6 million tons are contracted under long-term take or pay agreements in 2024. We anticipate selling the remaining 650,000 furnace equivalent tons in the foundry and spot coke markets. As a reminder, foundry tons do not replace blast furnace tons on a ton for ton basis. For example, due to differences in the production process, a single ton of foundry coke replaces approximately two tons of blast furnace coke. The order books for foundry and spot blast coke are solid. with a substantial portion of our 2024 sales finalized. While we expect to continue running at full capacity, the lower year-over-year adjusted EBITDA is primarily due to lower cold to cold yield value on our long-term take or pay contracts due to lower cold pricing. Moving to slide 10 to discuss logistics in more detail. 2024 logistics adjusted EBITDA is estimated to be between 30 and 35 million. This estimate is driven by significantly weaker market conditions at CMT. Our outlook considers the low expectations for thermal coal export volumes from the Gulf Coast as a result of tepid demand due to milder weather, lower cost gas imports, and ample coal inventory in Europe. We also expect a lower API2 price adjustment benefit as compared to 2023, which is factored into our guidance. We anticipate approximately 4.1 million tons of coal to be exported through CMT and approximately 3.8 million tons of non-coal throughput, such as iron ore, pet coke, and other products. Moving to the 2024 guidance summary on slide 11. Once again, we expect consolidated adjusted EBITDA to be between $240 and $255 million. Our domestic coke business expected to run at full capacity, but with lower cold to coke yield value on contracted coke sales due to lower coal pricing. We expect to face significant headwinds due to weak commodity markets and logistics segment impacting both volumes and pricing. As indicated earlier, we anticipate our capex requirements in 2024 to be between $75 million and $80 million, which is lower than our normal annual run rate. We expect 2024 operating cash flow to be between $185 and $200 million, driven by the reversal of favorable working capital build in 2023. Our free cash flow is expected to be between 105 and 125 million. With that, I'll turn it back over to Catherine.