Peabody — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported net loss attributable to common stockholders of $(32.8) million, or $(0.27) per diluted share, compared to a loss of $(70.1) million, or $(0.58) per diluted share, in the prior-year quarter.
• Reported Adjusted EBITDA of $97.5 million for the quarter, compared to $99.5 million in the prior-year quarter.
• Revenue for the quarter was $1,096.3 million, compared to $1,012.1 million in the prior-year quarter.
• Operating costs and expenses were $980.2 million for the quarter.
• Depreciation, depletion, and amortization were $97.6 million for the quarter.
• Total segment costs for the quarter were $968.9 million.
• Cash and cash equivalents were $434.3 million as of September 30, 2026, with total liquidity of $887 million.
• Net cash used in operating activities was $(1.4) million for the quarter, compared to $122.0 million in the prior-year quarter.
• Net cash used in investing activities was $(51.4) million for the quarter.
• Net cash used in financing activities was $(78.7) million for the quarter.

Guidance and Future Outlook:

• Anticipates stronger fourth quarter production and free cash flow.
• Fourth quarter Seaborne Thermal volume expected to be 3.6–3.8 million tons, with costs anticipated at $46–$51 per ton.
• Fourth quarter Seaborne Metallurgical volume expected to be 2.2–2.4 million tons, with costs anticipated at $150–$160 per ton.
• Fourth quarter Powder River Basin volume expected to be 19.5–21.5 million tons at an average price of $13.75 per ton and costs of approximately $13.00–$13.50 per ton.
• Fourth quarter Other U.S. Thermal volume expected to be 3.6–4.0 million tons at an average price of $59.00 per ton and costs of approximately $48–$52 per ton.
• Updated 2026 full-year guidance to reflect a 0.2 million ton increase in expected Seaborne Thermal export volume.
• Updated 2026 Seaborne Metallurgical volume guidance was lowered by 0.6 million tons, with costs expected to increase by approximately $15 per ton.
• Updated 2026 Powder River Basin sales volume guidance decreased by approximately 7.5 million tons.
• Updated 2026 Other U.S. Thermal volume guidance decreased by 0.2 million tons.
• Reduced 2026 capital expenditure guidance by $40 million to $300 million, including approximately $30 million at Centurion due to the deferral of development capital for the Northern panels.

Business Segments and Product Lines:

• Seaborne Thermal: Adjusted EBITDA increased 26 percent quarter over quarter to $65.5 million, with margin per ton increasing to $21.05. Tons sold were 3.1 million, including 2.0 million export tons. Revenue per ton was $77.63.
• Seaborne Metallurgical: Returned to positive Adjusted EBITDA of $5.2 million, supported by improved realized pricing. Sales of 2.2 million tons exceeded targets. Revenue per ton was $164.83.
• Powder River Basin: Sales volumes of 19.6 million tons were below company targets due to lower-than-anticipated coal burn. Adjusted EBITDA was $15.0 million. Costs per ton improved 8 percent quarter over quarter to $12.94.
• Other U.S. Thermal: Delivered 3.4 million tons, below expectations. Adjusted EBITDA was $25.5 million. Revenue per ton increased 8 percent quarter over quarter to $59.53.
• Centurion: Achieved targeted third quarter sales volume of 0.58 million tons while working through higher-cost faulted conditions. Production of approximately 45,000 tons was recorded in October. Fourth quarter sales volume is expected between 0.3 and 0.5 million tons.
• Centurion Engineering: Identified modifications including a base-lift power increase estimated at $1.5 to $2 million and a two-stage flipper estimated at $5 to $10 million, to be installed during the next longwall move expected in the third quarter of 2027.

Market and Competitive Landscape:

• Seaborne markets remain strong, driving higher realized export prices.
• Seaborne Thermal export average realized price per ton increased to $100.37 in the quarter.
• Seaborne Metallurgical realized pricing improved nearly $17 per ton quarter over quarter.
• Powder River Basin costs were impacted by higher diesel prices and lower-than-expected shipments.
• Other U.S. Thermal costs were impacted by lower-than-expected shipments.

Risks and Challenges:

• Centurion faces continued geological challenges with problematic faulting constraining production and equipment performance.
• Higher diesel prices and lower-than-expected coal burn in the U.S. impacted costs in the Powder River Basin and Other U.S. Thermal segments.
• Elevated costs per ton in Seaborne Metallurgical due to working through higher-cost faulted conditions at Centurion.

Management Commentary and Tone:

• Jim Grech, President and Chief Executive Officer, stated the third quarter demonstrated improving momentum across the portfolio with all segments reporting positive Adjusted EBITDA.
• Grech noted that seaborne operations benefited from higher pricing and that the company worked through higher-cost faulted conditions at Centurion.
• Grech indicated priorities for the fourth quarter remain operating safely, clearing the faulted zone at Centurion, and improving free cash flow.
• Mark Spurbeck, Chief Financial Officer, stated opportunistic actions reflect a continued focus on shareholder value and that eliminating remaining convertible notes reduces shareholder dilution while preserving financial flexibility.

Other Key Points:

• Repurchased $38.9 million of 2028 convertible notes for cash consideration of $58.1 million, effectively repurchasing 0.7 million shares.
• Issued a cash redemption notice for the remaining $39.9 million of outstanding 2028 convertible notes, to be completed in November 2026, with settlement of any conversion obligation in cash.
• The repurchase of convertible notes resulted in a $3.3 million charge to third-quarter earnings.
• The cash-settlement commitment resulted in recognition of a $20.7 million derivative liability and corresponding debt discount.
• Third-quarter results included approximately $4.4 million of interest expense related to debt discount amortization and a $7.2 million mark-to-market gain on the derivative liability.
• Declared a quarterly dividend of $0.075 per share on November 4, 2026, payable on December 9, 2026.
• Recognized by the Office of Surface Mining Reclamation and Enforcement with the 2026 Excellence in Surface Coal Mining Reclamation National Award.
• Total shares effectively repurchased in 2026 through convertible note repurchases reached 5.7 million shares.
• Eliminating the remaining 2028 convertible notes reduces shareholder dilution by 4 million shares.