NACCO Industries Inc (NC) 2024 Q3 法說會逐字稿

Gentleman and welcome to the NACCO Industries third quarter, 2024 earnings conference call at this time. All lines are in listen-only mode following the presentation, we will conduct a question and answer session and if at any time during this call, you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, October 31st 2024. I would now like to turn the conference over to our investor relations. Mrs Christina Kmetko. Please go ahead.

先生們，歡迎此時參加 NACCO Industries 2024 年第三季財報電話會議。演示結束後，所有線路均處於僅聽模式，我們將進行問答會議，如果在此通話期間的任何時間您需要立即幫助，請按星零鍵聯繫接線員。本次通話錄音時間為 2024 年 10 月 31 日星期四。我現在想將會議轉交給我們的投資者關係部門。克里斯蒂娜·克梅特科夫人。請繼續。

Thank you. Good morning everyone and welcome to our third quarter 2024 earnings call. Thank you for joining us this morning.

謝謝。大家早安，歡迎參加我們的 2024 年第三季財報電話會議。感謝您今天早上加入我們。

I'm Christina Kmetko and I'm responsible for investor relations at NACCO. Joining me today are J.C. Butler, President and Chief Executive Officer and Elizabeth I. Loveman, senior Vice President and controller. Yesterday, we published our 2024 3rd quarter results and filed our 10-Q. This information is available on our website. Today's call is also being webcast. The webcast will be on our website later this afternoon and available for approximately 12 months. Our remarks that follow including answers to your questions, contain forward-looking statements. These statements are subject to several risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements made here today.

我是 Christina Kmetko，負責 NACCO 的投資人關係。今天與我一起出席的有總裁兼執行長 J.C. Butler 和高級副總裁兼財務總監 Elizabeth I. Loveman。昨天，我們發布了 2024 年第三季業績並提交了 10 季業績報告。此資訊可在我們的網站上找到。今天的電話會議也進行了網路直播。該網路廣播將於今天下午晚些時候在我們的網站上發布，持續約 12 個月。我們接下來的評論（包括對您的問題的回答）包含前瞻性陳述。這些陳述受到多種風險和不確定性的影響，可能導致實際結果與今天發布的前瞻性陳述中表達的結果有重大差異。

These risks include among others matters that we've described in our earnings release 10-Q and other sec filings. We may not update these forward-looking statements until our next quarterly earnings conference call. We'll also be discussing Non-GAAP information that we believe is useful in evaluating the company's operating performance reconciliations for these Non-GAAP measures can be found in our earnings release and on our website with the formalities out of the way, I'll turn the call over to J.C. for some opening remarks. J.C.

這些風險包括我們在 10-Q 財報和其他證券交易文件中所述的其他事項。在下一次季度收益電話會議之前，我們可能不會更新這些前瞻性聲明。我們還將討論非 GAAP 信息，我們認為這些信息有助於評估公司的經營業績對賬，這些非 GAAP 衡量指標可以在我們的收益發布和我們的網站上找到，並完成手續，我將將電話轉給J.C，讓其發表一些開場白。J.C.

Thank you, Christina and good morning to those listening. Our 2024 3rd quarter was another strong quarter for us. It was very much helped along by the $13.6 million of business interruption insurance income. We recorded at Mississippi lignite mining company in relation to a boiler outage of the customer's power plant that reduced customer demand from mid December 2023 until the end of July. However, even without the insurance recovery, I'm pleased to say our results were very strong, specifically in our coal mining and minerals management segments, excluding the insurance, our consolidated operating profit increased over 197% from last year's third quarter loss. Christi will provide more detail about our third quarter income and an overview of our outlook after my remarks on the operations. I'll start with the positive operational news at our coal mining segment which delivered the biggest year over year improvement for the third quarter. As you might have surmised from my previous insurance recovery comment, the Red Hills power plant completed the repairs to the damaged boiler during the quarter. That said the resolution of this issue was only a small factor in the coal mining segment's improved results. Coal mining revenues declined primarily due to fewer deliveries at the Red Hills Power Plant as compared with 2023 when the plant was operational for an entire quarter.

謝謝克里斯蒂娜，各位聽眾早安。2024 年第三季對我們來說是另一個強勁的季度。1,360 萬美元的營業中斷保險收入對它的發展有很大幫助。我們記錄了密西西比褐煤礦業公司客戶發電廠鍋爐停駛的情況，導致從 2023 年 12 月中旬到 7 月底客戶需求減少。然而，即使沒有保險賠償，我很高興地說我們的業績也非常強勁，特別是在我們的煤炭開採和礦產管理領域，不包括保險，我們的綜合營業利潤比去年第三季度的虧損增長了197 % 以上。在我對營運發表評論後，克里斯蒂將提供有關我們第三季收入的更多詳細資訊以及我們的前景概述。我將從煤炭開採部門的積極營運消息開始，該部門第三季實現了最大的同比改善。正如您可能從我之前的保險恢復評論中猜測的那樣，紅山發電廠在本季度完成了受損鍋爐的維修。儘管如此，這個問題的解決只是煤炭開採部門業績改善的一個小因素。煤礦開採收入下降的主要原因是，與 2023 年相比，紅山發電廠的交付量減少，當時該發電廠運作了整個季度。

Despite this lower customer demand, Mississippi Lignite mining company, Red Hills mine operated more efficiently this quarter than a year ago. In 2023 we were still finalizing the move to a new mine area and contending with difficult mining conditions related both to the move and to weather. We're now established in this new mine area and mining conditions have improved. This contributed significantly to the improved results at this mine for the quarter.

儘管客戶需求下降，密西西比褐煤礦業公司 Red Hills 礦山本季的營運效率仍高於去年同期。2023 年，我們仍在完成向新礦區的搬遷工作，並應對與搬遷和天氣相關的困難採礦條件。現在我們在這個新礦區落戶，採礦條件已經改善。這對該礦本季度業績的改善做出了重大貢獻。

And I also like to note the improved earnings. Our unconsolidated coal mining operations. I mentioned last quarter, the temporary price concessions put in place at Falkirk to help facilitate Rainbow Energy's acquisition of cocreate station ended in May. Our third quarter results reflect a full quarter of the higher pricing which surrogated to the increase in our coal mining segment results at minerals management. I'm pleased to report that the investments we've been making in new mineral assets are delivering benefits. Third quarter, 2024 operating profit for this segment increased over last year, largely due to higher production volumes from the assets acquired in late 2023. We are very pleased with the work done by the Catapult Mineral Partners team which oversight sees this segment. They've expanded our portfolio of mineral interests and we are more diversified in terms of our oil gas mix, a wider range of operations, A greater geographic footprint and various stages of mineral development ranging from producing wells to undeveloped mineral interests. Catapult team continues to review additional investment opportunities.

我還想指出收入的改善。我們未合併的煤礦開採業務。我上個季度提到，福爾柯克為幫助 Rainbow Energy 收購 cocreate 電站而實施的臨時價格優惠已於 5 月結束。我們第三季的業績反映了整個季度較高的定價，這取代了我們在礦產管理方面煤炭開採部門業績的成長。我很高興地報告，我們對新礦產資產的投資正在帶來效益。該部門 2024 年第三季的營業利潤較去年增加，這主要是由於 2023 年末收購的資產產量增加。我們對 Catapult Mineral Partners 團隊所做的工作感到非常滿意，該團隊負責監督這一領域。他們擴大了我們的礦產權益組合，我們的油氣組合、更廣泛的業務、更大的地理足跡以及從生產井到未開發礦產權益的礦產開發的各個階段都更加多元化。Catapult 團隊繼續審查其他投資機會。

Shifting to the North American mining segment. First, let me say we are thankful that all of our Florida employees are safe and the impact to our operations from the recent hurricanes was not substantial.

轉向北美採礦業。首先，我們很慶幸佛羅裡達州的所有員工都很安全，而且最近的颶風對我們的營運影響並不大。

The significant rain in Florida as well as planned customer outages did affect our third quarter deliveries despite this lower customer demand and excluding the effect of reimbursable costs. North American mining's revenue still increased 24% year over year due to favorable pricing and delivery mix at the lis during quarries looking at North American mining's operating results last quarter, I mentioned that we had begun mining phosphate for a new customer in Florida. This customer temporarily ceased operations in the third quarter as it works through business challenges. We are hopeful these challenges can be resolved. We established a $900,000 reserve against their receivable primarily as a result of this charge, North American mining generated a modest operating loss in the 2024 3rd quarter compared with the prior year operating profit.

儘管客戶需求較低且不包括可報銷成本的影響，但佛羅裡達州的大雨以及計劃中的客戶停電確實影響了我們第三季的交貨。北美礦業的收入仍同比增長 24%，得益於採石場有利的定價和交付組合。該客戶因應對業務挑戰而在第三季暫時停止營運。我們希望這些挑戰能夠得到解決。我們針對其應收帳款設立了 90 萬美元的準備金，主要是由於這項費用，與上一年的營業利潤相比，北美礦業在 2024 年第三季產生了適度的營業虧損。

I'd also like to note that lithium Americas continues to make progress on the Thacker Pass project. Earlier this week, they announced the closing of a significant loan from the Department of Energy which will help finance the construction of the Thacker Pass lithium project in Northern Nevada. We're thrilled that our customer has reached this important milestone and what this latest development means for this project, we continue to support the project by assisting with certain construction services. And in addition, in the fourth quarter of 2024 we in lithium Americas agreed to expand the scope of our work to include transportation of clay tailings. Once lithium production commences phase one, lithium production is estimated to begin in 2027.

我還想指出，美洲鋰公司在 Thacker Pass 專案上繼續取得進展。本週早些時候，他們宣布結束了能源部的一筆大額貸款，這將有助於為內華達州北部的 Thacker Pass 鋰項目的建設提供資金。我們很高興我們的客戶已經達到了這一重要的里程碑，而這項最新的發展對該專案意味著什麼，我們將繼續透過協助某些施工服務來支援該專案。此外，在 2024 年第四季度，我們美洲鋰公司同意擴大我們的工作範圍，將黏土尾礦的運輸納入其中。一旦鋰生產開始第一階段，鋰生產預計將於 2027 年開始。

Finally moving to mitigation resources of North America results for this business continue to fluctuate based on the mix of outstanding project projects.

最後轉向北美的緩解資源，該業務的結果繼續根據優秀項目的組合而波動。

However, this team continues to execute existing mitigation and reclamation projects and build on the substantial foundation is the it is established over the past several years based on current expectations for new projects as well as time adding timing of permit approvals and mitigation credit releases this part of our business anti anticipates achieving a full year profit in 2025. As this business matures, we believe it can provide solid rates of return on capital employed overall, I continue to be very optimistic about our business. I have a lot of confidence in our trajectory and the team and I'm pleased with the way all of these businesses continue to advance their strategies, including efforts to protect our coal mining business. With that. I'll turn the call back over to Christi to cover our quarterly results and outlook in more detail. Christi.

然而，該團隊繼續執行現有的緩解和復墾項目，並建立在過去幾年基於當前對新項目的預期以及許可證批准和緩解信用釋放的時間增加的時間基礎上建立的堅實基礎上。的業務預計在2025 年實現全年盈利。隨著這項業務的成熟，我們相信它可以提供穩定的整體資本回報率，我仍然對我們的業務感到非常樂觀。我對我們的發展軌跡和團隊充滿信心，我對所有這些企業繼續推動其策略的方式感到滿意，包括努力保護我們的煤礦開採業務。就這樣。我會將電話轉回給克里斯蒂，以更詳細地介紹我們的季度業績和前景。克里斯蒂.

Thank you J.C. I'll start with some high level comments about our consolidated third quarter financial results. Then I'll discuss the results of our individual segments at the consolidated level. We reported operating profit of $19.7 million and net income of $15.6 million which equated to $2.14 per share for last year's third quarter, we reported an operating loss of $6.3 million and a net loss of $3.8 million or a loss of $0.51 per share.

謝謝 J.C. 我將首先對我們第三季綜合財務業績進行一些高層評論。然後我將討論我們各個細分市場的綜合結果。我們報告的營業利潤為1,970 萬美元，淨利潤為1,560 萬美元，相當於去年第三季的每股收益2.14 美元。虧損0.51 美元。

EBITDA increased to $25.7 million from $400,000 in 2023. As J.C mentioned, these financial results include insurance recovery income of $13.6 million recorded in our coal mining segment results.

EBITDA 從 2023 年的 40 萬美元增至 2,570 萬美元。正如 J.C 所提到的，這些財務業績包括我們煤炭開採部門業績中記錄的 1,360 萬美元的保險賠償收入。

Looking at our coal mining segment, that segment reported operating profit of $19.9 million and generated segment adjusted EBITDA of 22.1 million. This compares to an operating loss of $4.7 million and close to break even segment adjusted EBITDA in 2023. J.C generally discussed the reasons for the higher coal mining segment results. I would note that in addition to the favorable MLMC results and higher Falkirk pricing improved results at Cato. Another one of our unconsolidated minds also contributed to the profit improvement since J.C already provided the primary drivers of the minerals management and North American mining results. I would just mention the financial numbers, minerals management. Third quarter revenues of 2024 revenues of $8.8 million increased 54% from 5.7 million a year ago. Operating profit improved to 6.2 million up 71% compared to 3.6 million in the 2023 3rd quarter, North American mining reported an operating loss of approximately half a million dollars versus profit of $900,000 in 2023 segment adjusted EBITDA was $2.2 million and down approximately 700,000 from last year.

看看我們的煤炭開採部門，該部門報告營業利潤為 1,990 萬美元，部門調整後 EBITDA 為 2,210 萬美元。相較之下，2023 年營運虧損為 470 萬美元，部門調整後 EBITDA 接近收支平衡。J.C 整體討論了煤炭開採部門業績較高的原因。我要指出的是，除了有利的 MLMC 結果和更高的 Falkirk 定價之外，Cato 的表現也有所改善。我們的另一項未整合的想法也為利潤的提高做出了貢獻，因為 J.C 已經提供了礦產管理和北美採礦結果的主要驅動力。我只想提及財務數據和礦產管理。2024 年第三季營收為 880 萬美元，比一年前的 570 萬美元成長 54%。營業利潤從2023 年第三季的360 萬美元增至620 萬美元，成長71%，北美礦業報告營業虧損約50 萬美元，而2023 年部門調整後的EBITDA 為220 萬美元，比前一年下降約70 萬美元年。

Looking forward, we expect our coal mining segment operating profit to increase in both the 2024 4th quarter and full year compared with both of the prior year periods. This improvement occurs with or without the $60.8 million impairment charge that was taken in fourth quarter, 2023 higher segment adjusted EBITDA which excludes the impairment charge is also projected for both periods. These anticipated increases are primarily due to higher earnings at the unconsolidated coal mining operations and an expected improvement in results at Mississippi lignite mining company due to an increase in the index based sales price partly offset by a reduction in customer demand.

展望未來，我們預計煤炭開採部門的營業利潤在 2024 年第四季和全年均將較去年同期有所成長。無論是否考慮 2023 年第四季 6,080 萬美元的減損費用，這項改善都會發生，預計這兩個時期的較高部門調整後 EBITDA（不包括減損費用）也將出現。這些預期成長主要是由於未合併煤炭開採業務的收益增加以及密西西比褐煤礦業公司業績的預期改善，這是由於基於指數的銷售價格的上漲部分被客戶需求的減少所抵消。

The projected increase in fourth quarter, 2024 earnings at the unconsolidated coal mining operations is driven primarily by an expectation for increased customer requirements as well as the higher per ton management fee. At Falkirk.

預計 2024 年第四季未合併煤炭開採業務的利潤將增加，主要是由於客戶需求增加的預期以及每噸管理費的上漲。在福爾柯克。

Turning to North American mining, we expect both the 2024 4th quarter and full year operating profit and segment adjusted EBITDA to increase year over year fourth quarter. Results are also anticipated to improve over this past quarter. These improvements are mainly due to mutually advantageous limestone contract amendments and the scope of work expansion with another customer that took effect earlier this year.

談到北美礦業，我們預計 2024 年第四季和全年營業利潤以及部門調整後的 EBITDA 將比去年同期成長。預計上個季度的業績也會有所改善。這些改進主要歸功於互利的石灰石合約修訂以及今年稍早生效的與另一家客戶的工作範圍擴大。

Finally, at minerals management, we expect operating profit and segment adjusted EBITDA to decrease in the 2024 4th quarter and full year compared with the prior year period, excluding the fourth quarter, 2023 impairment charge of $5.1 million as well as the $4.5 million gain on sale recognized in the 2024 2nd quarter which affects the full year comparison.

最後，在礦產管理方面，我們預計2024 年第四季和全年的營業利潤和部門調整後EBITDA 將較上年同期下降，不包括2023 年第四季510 萬美元的減損費用以及450 萬美元的收益2024 年第二季確認的銷售額將影響全年比較。

These declines are primarily driven by current market expectations for natural gas and oil prices as well as development and production assumptions on currently owned reserves.

這些下降主要是由當前市場對天然氣和石油價格的預期以及對現有儲量的開發和生產假設所推動的。

As we've mentioned our fourth quarter, 2023 results included a pretax impairment charge totaling $65.9 million. My upcoming results comments about our anticipated consolidated results exclude the effect of this charge overall. We expect fourth quarter and full year 2024 consolidated operating profit and adjusted ebita to increase significantly year over year. These improvements are primarily due to the anticipated increases in profitability at coal mining from improved results at Mississippi Lignite Mining company, Falkirk and Cato. Also North American mining's growth and profit improvement initiatives are expected to contribute to the improved earnings full year. 2024 net income is expected to increase significantly over 2023.

正如我們所提到的，2023 年第四季的業績包括總計 6,590 萬美元的稅前減損費用。我即將發布的關於我們預期綜合業績的評論排除了這項費用的整體影響。我們預計 2024 年第四季和全年綜合營業利潤和調整後息稅前利潤將比去年同期大幅成長。這些改善主要是由於密西西比褐煤礦業公司、福爾柯克和卡托業績的改善預計將提高煤炭開採的獲利能力。此外，北美礦業的成長和利潤改善舉措預計將有助於全年收益的提高。預計2024年淨利將較2023年大幅成長。

Looking forward to 20. Looking towards 2025 the company's businesses provide critical inputs for electricity generation, construction and development and the production of industrial minerals and chemicals. Increasing demand for electricity ensuring and current federal policies are creating favorable macroeconomic trends within these industries. We anticipate solid customer demand at our coal mining operations in 2025 and will benefit from the absence of temporary price concessions at Falkirk. However, cost inflation is anticipated to affect Mississippi Lignite mining company 2025 results.

期待20。展望 2025 年，該公司的業務為發電、建築和開發以及工業礦物和化學品的生產提供關鍵投入。對電力需求的不斷增長和當前的聯邦政策正在這些行業內創造有利的宏觀經濟趨勢。我們預計到 2025 年，我們的煤炭開採業務的客戶需求將會強勁，並將受益於福爾柯克沒有臨時價格優惠的情況。然而，成本上漲預計將影響密西西比褐煤礦業公司 2025 年的業績。

North American mining expects to build on its current 2024 momentum to deliver further improved results in 2025 benefits from new and amended contracts and new business expansion opportunities are expected to generate improved. 2025 results on expectations for comparable year over year customer demand.

北美礦業預計將在 2024 年目前的勢頭基礎上，在 2025 年實現進一步改善的業績，受益於新的和修訂的合同，並且新的業務擴張機會預計將產生改善。 2025 年結果是基於可比較的同比客戶需求預期。

Mineral management's current high quality diversified portfolio provides a strong foundation of well positioned assets that are expected to continue to deliver solid financial results. However, given current trends in oil and natural gas prices and projected volumes, we anticipate a moderate production decline in 2025.

礦產管理目前的高品質多元化投資組合為定位良好的資產奠定了堅實的基礎，預計將繼續帶來穩健的財務表現。然而，考慮到當前石油和天然氣價格趨勢以及預計產量，我們預計 2025 年產量將適度下降。

In addition, we are taking actions to terminate our defined benefit pension plan which will eliminate future volatility from changes in the pension obligation. Once complete obligations under the terminated plan will be transferred to a third party insurance provider. Although the plan is currently overfunded NACO is anticipating a noncash settlement charge in 2025 upon termination.

此外，我們正在採取行動終止我們的固定福利退休金計劃，這將消除退休金義務變化帶來的未來波動。一旦完成終止計劃下的義務將轉移給第三方保險提供者。儘管該計劃目前資金過剩，但 NACO 預計在 2025 年終止時將收取非現金結算費用。

Before I turn the call over to questions. Let me close with some information about our balance sheet and cash flow. We ended the quarter with consolidated cash of approximately $63 million and debt of $70 million during the third quarter. We also purchased approximately 68,000 shares for $2 million under an existing share repurchase program.

在我將電話轉入提問之前。讓我以有關我們的資產負債表和現金流的一些資訊作為結束語。本季末，我們的綜合現金約為 6,300 萬美元，第三季債務為 7,000 萬美元。我們也根據現有的股票回購計畫以 200 萬美元的價格購買了約 68,000 股股票。

We amended our revolving credit facility during Q3 to increase the revolving credit commitments to 200 million and extend the maturity to September 2028 availability under the revolver was approximately 131 million at September 30th 2024.

我們在第三季修改了循環信貸額度，將循環信貸承諾增加至 2 億，並將期限延長至 2028 年 9 月，截至 2024 年 9 月 30 日，循環信貸額度約為 1.31 億。

We expect cash flow before financing activities to be a use of cash for the full year. 2024. We will now turn to any questions you may have.

我們預計融資活動前的現金流為全年的現金使用。2024 年。我們現在將回答您可能提出的任何問題。

Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment again. Please press star one to ask the question and we'll pause for just a moment to allow everyone an opportunity to signal for questions.

謝謝。如果您想提問，請按下電話鍵盤上的星號一號。如果您使用免持電話，請確保您的靜音功能已關閉，以便您的訊號再次到達我們的裝置。請按星號 1 來提問，我們將暫停片刻，以便每個人都有機會提出問題。

Our first question comes from the line of dog ways from ESW investment. Please go ahead.

我們的第一個問題來自 ESW 投資的狗路。請繼續。

Hey, good morning.

嘿，早安。

Morning.

早晨。

Hey. So I guess starting with the potash, customer, what happens when a customer is facing financial difficulties? Do you stop doing work? And then what happens to the equipment and so on?

嘿。所以我想從鉀肥開始，客戶，當客戶面臨財務困難時會發生什麼事？你停止工作嗎？那麼設備等會怎麼樣呢？

Well, I mean, generally it completely depends on the situation, right? We're going to handle any of these specifically to the circumstances. If you know, if it's a place where we can pull people away. So that we're not incurring costs. If it's you know it's a contract where we're actually paying the cost and you know we'll pull our employees away we'll reduce costs do what we need to do, secure equipment if it's our equipment, you know button things up you know in other situations you know it might be that you know our customer is paying all the costs and you know we'll make an assessment about the situation there as well. So it's really it's very situation specific and contract specific?

嗯，我的意思是，通常這完全取決於情況，對吧？我們將根據情況具體處理其中的任何一個。如果你知道的話，如果這是一個我們可以把人拉走的地方。這樣我們就不會產生費用。如果你知道這是一份我們實際支付費用的合同，你知道我們會解僱員工，我們會降低成本，做我們需要做的事情，保護設備，如果這是我們的設備，你知道把事情搞定在其他情況下，您可能知道我們的客戶正在支付所有費用，並且您知道我們也會對那裡的情況進行評估。那麼這真的是根據具體情況和合約而定的嗎？

That makes sense. Are you able to say how many tons that contract is?

這是有道理的。你能說一下這份合約有多少噸嗎？

No. I will also tell you that one of the things that I've been thinking about anyway, is as we start to diversify into more and more different kinds of minerals within the North American mining segment is tons really a useful statistic. While it's predominantly limestone makes sense as you start mixing in other things like potash and lithium and you know, other things that we'd like to mind in the future, it becomes a less meaningful number.

不。我還要告訴你，無論如何，我一直在考慮的一件事是，當我們開始在北美採礦領域內多元化生產越來越多不同種類的礦物時，這確實是一個非常有用的統計數據。雖然它主要是石灰石，但當你開始混合鉀鹽和鋰等其他物質時，你知道，我們將來要注意的其他物質，它就變得不太有意義了。

Okay. And by the way I think I misspoke I think I described it as potash but it's phosphate, right? Sorry

好的。順便說一句，我想我說錯了，我想我把它描述為鉀肥，但它是磷酸鹽，對嗎？對不起

I'm sorry. Phosphate. Yeah, you got me doing it too.

對不起。磷酸鹽。是啊，你也讓我這麼做了。

I planted that in your head. So okay.

我把它植入你的腦海裡。那麼好吧。

And I guess you don't want to characterize whether this is a contract where the customers is covering the cost.

我想您不想描述這是否是客戶承擔成本的合約。

I mean look we took a charge that we thought you know you I mean you know how works right? If you're if you've got any concerns at all you need to take a charge. I think our statement was we're hopeful that this is going to get resolved here in the next you know, couple quarters and that these guys are going to are going to you know be moving forward so you know that's our position as we stand here right now we're obviously staying very close to it. They're being very transparent with us and we feel overall pretty good about the situation and where it's headed. But, you know we're not in control and we're a service provider and we're going to have to see how this plays out.

我的意思是，你看，我們認為你了解你，我的意思是你知道如何運作，對嗎？如果您有任何疑慮，則需要付費。我認為我們的聲明是我們希望這個問題能夠在接下來的幾個季度內得到解決，並且這些人將繼續前進，所以你知道這就是我們站在這裡的立場現在我們顯然已經非常接近它了。他們對我們非常透明，我們對目前的情況和發展方向總體感覺很好。但是，你知道我們無法控制，我們是服務提供者，我們必須看看事情會如何發展。

Okay. And then Thank you mentioned that the decline in tonnage for the quarter still on North American mining was largely due to rain and customer maintenance. Would you expect that tonnage to kind of bounce back to the levels in the second quarter in the fourth quarter and going forward?

好的。然後謝謝您提到，本季北美採礦業的噸位下降主要是因為降雨和客戶維護。您是否預期噸位會在第四季及未來反彈至第二季的水平？

Yeah. So, normally I think we would the big wild card is you know a substantial amount of our operations, although not all are in Florida and in particular we've got a number of quarries where we operate in Central Florida. The 12 punch of the two hurricanes coming through there both Helene and Milton. Have you know really slowed down operations in that part of Florida? And it's for a number of reasons. In some instances there are quarries that are just flooded out and it's you know impossible for them to get to work until the water recedes in other instances. Ty what typically happens in Florida after a hurricane is you know we've all seen the you know pictures in the newspaper and videos online or on television, there's just piles of debris and mattresses and sofas and trees and all sorts of stuff everywhere. A lot of the aggregates that we mine and deliver to our customers are then hauled away from the customer side by independent truckers. After a hurricane. A lot of truckers go to work, for FEMA and the state and other organizations that are, you know, hard at work trying to get things cleaned up. And in addition, a lot of the construction projects where these, some of these aggregates were going, you know those things slow down as well. So for a while, there's a diversion of kind of the people that put aggregates to work while they're cleaning up from the hurricane and that you know that varies based on the hurricane and the location and all that.

是的。因此，通常情況下，我認為我們最大的不確定因素是你知道我們的大量業務，儘管並非全部都在佛羅裡達州，特別是我們在佛羅裡達州中部有許多採石場。兩場颶風的第 12 次重擊都經過那裡，海倫和米爾頓。您知道佛羅裡達州那部分的營運速度真的減慢了嗎？這是有很多原因的。在某些情況下，有些採石場剛剛被洪水淹沒，您知道在其他情況下，除非水退去，否則它們無法開始工作。佛羅裡達州颶風過後通常會發生的情況是，我們都在報紙上看到過圖片，在網路或電視上看到圖片，到處都是成堆的碎片、床墊、沙發、樹木和各種各樣的東西。我們開採並交付給客戶的許多骨材隨後由獨立卡車司機從客戶方運走。颶風過後。許多卡車司機去為聯邦緊急管理局、州政府和其他組織工作，你知道，他們正在努力清理問題。此外，許多建設項目，其中一些骨料正在進行，你知道這些事情也會放緩。因此，有一段時間，人們在清理颶風時將骨料投入工作，你知道這會根據颶風和地點等因素而有所不同。

Typically, I'm not saying this is exactly what's going to happen here but typically then after a period of time when things start to return to normal demand picks up for the construction projects or other activities that are underway using aggregates. But there tends to be a little bit of an additional bump because municipalities in the state are in there, fixing roads and bridges and beaches and other things that require aggregates. So, you know it's hard to say exactly how that's going to play out quarter to quarter. But I wanted to give you a flavor for how the dynamics work in Florida typically after hurricanes.

通常情況下，我並不是說這正是這裡將要發生的情況，但通常是在一段時間之後，當建築項目或正在進行的使用骨料的其他活動的需求開始恢復正常時。但往往會出現一些額外的障礙，因為該州的市政當局正在那裡修復道路、橋樑、海灘和其他需要骨料的東西。所以，你知道很難確切地說每季的情況會如何。但我想讓您了解颶風過後佛羅裡達州的動態如何運作。

Yeah, that's helpful. And that brings me to another question which is you know when in a normal period on a typical aggregate mine are you mining to your capacity or are you mining to the customers you know targeted volume?

是的，這很有幫助。這讓我想到了另一個問題，即在正常時期，在典型的骨料礦山上，您是否會開採到自己的能力，或者是否會開採到您知道目標數量的客戶？

Yeah, it's all customer targeted volume.

是的，這都是客戶目標量。

Right?

正確的？

I would say the only time it goes the other way is if we're at capacity with the equipment that's there which in some cases we owe and in some cases they owe.

我想說，唯一出現相反情況的情況是，我們的設備已經達到了容量，而這些設備在某些情況下是我們欠的，在某些情況下是他們欠的。

Okay. And, but it's based on their demand. We, we, you know, sometimes describe that as customer requirements.

好的。而且，但這是基於他們的需求。我們，我們，你知道，有時將其描述為客戶要求。

Right? And I assume there's a certain, I mean a fair bit of fixed cost leverage right? So that because you got to have the people there and you got to have the equipment there. So I assume your costs are relatively fixed and then you know if the demand spikes that's a lot more incremental margin is that the right way to think about it?

正確的？我認為存在一定的，我的意思是相當多的固定成本槓桿，對嗎？因為那裡必須有人員和設備。所以我假設你的成本相對固定，然後你知道需求激增是否會帶來更多的增量利潤，這是正確的思考方式嗎？

Well, it's very contract specific There's some instances where the customer owns the drag line pays all of our costs and we receive a service fee and there are some contracts where we own the drag line and pay all of our costs and, and you know, provide the work at a fee that covers our cost and capital. We have another contract structure that's a bit in the middle of that where we own the equipment, but the customer gives us a fixed monthly payment related to the capital that we have invested and we get a fixed payment related to the fixed costs that we incur and then the service part of it operates on the margin. So it's a, there's a range of contract structures that exist in, in this business.

嗯，這是非常具體的合同。 ，提供工作的費用足以支付我們的成本和資本。我們有另一種合約結構，它位於我們擁有設備的中間位置，但客戶每月向我們支付與我們投資的資本相關的固定付款，並且我們獲得與我們產生的固定成本相關的固定付款然後它的服務部分是靠邊際運作的。所以，這個行業存在著一系列的合約結構。

But your question, your question is about leveraging, it's really about and regardless of who uses, who owns the equipment, who pays the fixed cost. You know, this, all of these businesses are you know, it's a quarry with a fixed amount of minerals and customers invested in them, they have their processing plan, we or they have the mining equipment. So for both sides, it's a really a volume, volume game.

但你的問題，你的問題是關於槓桿作用，它實際上是關於並且無論誰使用、誰擁有設備、誰支付固定成本。你知道，所有這些企業都是你知道的，這是一個擁有固定數量礦物的採石場，客戶投資其中，他們有他們的加工計劃，我們或他們有採礦設備。所以對雙方來說，這都是一場規模非常大的遊戲。

Right? No, that makes sense. And it does what you're describing have anything to do with how you categorize. The businesses is consolidated and unconsolidated in the in that division or is that totally a separate issue?

正確的？不，這是有道理的。它的作用與您所描述的內容與您的分類方式有關。該部門的業務是合併還是未合併，或者這完全是一個單獨的問題？

That is a great question for Liz Loveman.

對莉茲·洛夫曼來說，這是一個很好的問題。

That is that, that goes into it really you know the variable interest entity, accounting relies on control. And so we evaluate each contract individually and based on the merits of that contract, we determine if it's consolidated and unconsolidated?

也就是說，你真的知道可變利益實體，會計依賴控制。因此，我們單獨評估每份合同，並根據該合約的優點，確定它是否合併或未合併？

I see so the less so in situations where you don't own the equipment and you're more of a service provider that would be more likely to be unconsolidated, is that right?

我認為，在您不擁有設備並且您更像是一個更有可能被分散的服務提供者的情況下，這種情況就更少了，對嗎？

Okay. great. And if you try to expand that business outside of Florida, are there other people who do the same thing you do? You know, I'm curious if there would ever be M&A opportunities to sort of accelerate your diversification.

好的。偉大的。如果您嘗試將業務擴展到佛羅裡達州以外的地區，是否有其他人做與您相同的事情？你知道，我很好奇是否會有併購機會來加速你的多元化發展。

So we actually are expanding pretty rapidly out of Florida. I mean, we've got operations in Texas, Nebraska, Arkansas, Virginia. And, you know, and continue to expand and, you know, the lithium mine up in Northern Nevada. So we continue to expand the footprint of this business, You know, pretty aggressively. We operate, we have relationships with gosh I don't know how many but a significant number of the TOP10 aggregates producers in the country and we're operating under a model that says you know they're experts at their aggregates business they know how to assess their customer base and size it and sell it and all those things and we're experts in mining which is not their core expertise. So we're leveraging that that those complementary skill sets and the relationships we have both with current and other customers in order to expand this as much as we can out of the state You know more diversification gives us less exposure to hurricanes Certainly. But it's also just good for the business.

所以我們實際上正在快速地擴展到佛羅裡達州以外的地區。我的意思是，我們在德克薩斯州、內布拉斯加州、阿肯色州、維吉尼亞州都有業務。而且，你知道，並繼續擴張，你知道，內華達州北部的鋰礦。因此，我們繼續非常積極地擴大這項業務的足跡。我們運營，我們與天哪有關係，天哪，我不知道有多少，但數量很大，是該國排名前十的骨料生產商，我們的運營模式表明，您知道他們是骨料業務的專家，他們知道如何做評估他們的客戶群並確定其規模並出售它以及所有這些東西，我們是採礦方面的專家，但這不是他們的核心專業知識。因此，我們正在利用這些互補的技能組合以及我們與當前和其他客戶的關係，以便盡可能地將其擴展到州外。但這對企業來說也有好處。

Right.

正確的。

So, you see an opportunity to with those relationships you have to kind of like if we just took like a Martin Marriott I mean where they obviously have a national footprint where you could start working with them in other states.

所以，你看到了建立這些關係的機會，你必須像馬丁萬豪一樣，我的意思是，他們顯然在全國範圍內都有足跡，你可以開始在其他州與他們合作。

Yeah, absolutely.

是的，絕對是。

And, you know, we have done so with I mean I'm not going to list the customers but we have done that with a number of customers.

而且，你知道，我們已經這樣做了，我的意思是我不會列出客戶，但我們已經對許多客戶這樣做了。

Okay. Makes sense.

好的。有道理。

I guess moving to the mineral management, you know, I think there's a certain amount of optimism around gas prices next year. You know if that plays out would that change your forecast or your expectation in terms of production volume? Is that very much a price dependent item?

我想轉向礦物管理，你知道，我認為明年天然氣價格有一定程度的樂觀情緒。您知道如果這種情況發生，會改變您的預測或產量預期嗎？這很大程度上取決於價格嗎？

I mean, it's sure it's I mean the higher prices will always affect you know output. But I think the biggest impact for us would actually just be from the price effect. And that's you know that's we're always aware that that's great for our minerals management business given the significant amount of natural gas reserves that we own but it's also good for our coal business because it makes the coal generating assets more competitive events natural gas power generation.

我的意思是，可以肯定的是，更高的價格總是會影響產量。但我認為對我們來說最大的影響其實只是來自價格效應。您知道，我們始終意識到，鑑於我們擁有大量天然氣儲量，這對我們的礦產管理業務非常有利，而且對我們的煤炭業務也有好處，因為它使煤炭發電資產更具競爭力。

Right.

正確的。

Do you have you ever thought or do you have the ability to sell forward. Guess. I know you're not taking physical possession of it. But is there you know just as a financial kind of hedge.

你有沒有想過或你有沒有能力遠期銷售。猜測。我知道你並沒有實際佔有它。但你知道這只是一種金融對沖嗎？

So the hedging strategies that we have looked at, one wouldn't meet hedge, accounting, you know, requirements that we'd like to have. The other is that you know hedging has a cost. Everybody's always focused on the benefits of hedging. The hedging has a cost and because we are operating our business we're you know we own these minerals and we're buying minerals really with cash. We don't have debt we don't have you know we're not a yield code like some of the mineral companies out there. We're not funded by a private equity firm. We don't have to incur the cost of the hedges. And you know can just roll along with the prices it as it moves. And over the long term we think that's going to be more profitable. We think if there are short term pressures on us, we think if we had short term pressures, you know, hedging can make sense because you gotta be assured of the timing of those income streams. But in our situation, we think we can avoid the cost of hedging and we have a long term will benefit from that.

因此，我們研究過的避險策略無法滿足我們想要的避險、會計要求。另一個是你知道對沖是有成本的。每個人都始終專注於對沖的好處。對沖是有成本的，因為我們正在經營我們的業務，所以我們擁有這些礦物，我們實際上是用現金購買礦物。我們沒有債務，我們沒有債務，你知道我們不像一些礦業公司有收益準則。我們不是由私募股權公司資助的。我們不必承擔對沖成本。而且您知道可以隨著價格的變化而滾動。從長遠來看，我們認為這會更有利可圖。我們認為，如果我們面臨短期壓力，我們認為，如果我們面臨短期壓力，你知道，對沖是有意義的，因為你必須確保這些收入流的時間安排。但就我們的情況而言，我們認為我們可以避免對沖成本，並且從長遠來看我們將從中受益。

Okay. And then moving on to the coal my impression from the 10-K is that those are all multi decade, particularly just focusing more on the unconsolidated assets that those are multi decade reserves. But I guess is that right? And would you want to kind of put a general number on what the reserve life is of those unconsolidated assets?

好的。然後轉向煤炭，我對 10-K 的印像是，這些都是數十年的，特別是更專注於那些屬於數十年儲備的未合併資產。但我想是這樣嗎？您是否想對這些未合併資產的儲備壽命給出一個大致數字？

There's a lot of reserves there. Liz, I don't know what's disclosed in the technical parts of any of our documents but there is there's lots of coal reserves in, in the unconsolidated coal mines.

那裡有很多儲備。麗茲，我不知道我們任何文件的技術部分揭露了什麼，但散裝煤礦裡有大量的煤炭儲量。

Yeah. Okay.

是的。好的。

Look at the10 if you look in the 10-K we have some you know detail included that we update each year in the in the front section of the 10-K And if.

如果您查看 10-K，請查看 10，我們有一些您知道的詳細信息，我們每年都會在 10-K 的前面部分進行更新。

Okay, I'll look at.

好的，我看看。

I would tell you that reserve the reserve I mean the consolidated mines are in North Dakota and I can tell you that the coal reserves in North Dakota are vast plenty of plenty of coal reserves that are probably go beyond what is described in our disclosures because I guess that's tied to the permit area. So as you know, as you expand the permit area, there's more reserves there.

我會告訴你，儲備儲備我的意思是綜合煤礦位於北達科他州，我可以告訴你，北達科他州的煤炭儲量非常豐富，可能超出我們披露的內容，因為我我猜這與許可區域有關。如您所知，當您擴大許可區域時，那裡會有更多的儲備。

Okay.

好的。

All right. Well, thanks that's all I have for today and appreciate the time as always and talk to you next quarter.

好的。好吧，謝謝，今天就講到這裡，並一如既往地珍惜這段時光，並在下個季度與您交談。

we appreciate your questions. It's great to see somebody digging into the business that's got an interest in what we're doing and we're happy to take your questions on the call.

我們感謝您的提問。很高興看到有人對我們正在做的事情感興趣並深入研究該業務，我們很高興在電話中回答您的問題。

Again. Please press star one to ask the question, sir. No question at this time. Please continue.

再次。先生，請按星一號來提問。目前沒有問題。請繼續。

Okay. And with that we'll conclude our Q&A session. I'd like to provide a few reminders. A replay of our call will be available later this morning. We'll also post a transcript on our website when it becomes available. If you do have any questions, please reach out to me. You can reach me at the phone number on the press release. I hope you enjoy the rest of our day your day. Sorry. And now I'll turn it back to our operator to conclude the call.

好的。我們的問答環節到此結束。我想提供一些提醒。今天上午晚些時候我們將重播我們的電話會議。當文字記錄可用時，我們也會在我們的網站上發布文字記錄。如果您有任何疑問，請與我聯絡。您可以透過新聞稿中的電話號碼與我聯絡。我希望您今天剩下的時間過得愉快。對不起。現在我會將其轉回給我們的接線員以結束通話。

Thank you. This concludes today's conference call. You can listen to the replay by dialing +18886606345 and enter the passcode +49480. Thank you, everyone You may now disconnect.

謝謝。今天的電話會議到此結束。您可以撥打+18886606345並輸入密碼+49480收聽重播。謝謝大家，現在可以斷開連線了。