Coronado Reports 11% Price Rise, 31% Cost Increase, and Logan Mine Idling

Operational Reset Targets Cash Flow and Efficiency

Coronado Global Resources (ASX:CRN) has kicked off a significant operational and commercial reset aimed at improving cash flow and strengthening its balance sheet after a challenging 2025. The reset focuses on mine plan restructuring, fleet productivity enhancements, and contract renegotiations across its portfolio, with no new large-scale capital programs planned following the completion of recent expansions. Interim CEO Gerry Spindler highlighted that these measures are designed to capture operating leverage as production rates ramp up through 2026.

This reset comes on the back of a tough year marked by weak metallurgical coal prices and operational disruptions, as detailed in the company’s recent 2026 AGM and operational recovery update. The company expects a cash flow uplift in the June quarter driven by improved pricing, currently around US$35 per tonne, and enhanced productivity.

Buchanan Mine Delivers Strong EBITDA Growth

The Buchanan mine in the US was a standout in the March quarter, more than doubling its EBITDA to US$30 million compared to the December 2025 quarter. This performance was achieved despite two longwall moves and ongoing market headwinds, underscoring the asset’s quality and the benefits of recent capital investments. Buchanan’s realised metallurgical coal price rose by 16.3% quarter on quarter, helping offset modest cost increases.

With both longwalls now operational and expansion infrastructure fully commissioned, Buchanan is positioned for consistent production and returns through the remainder of the year. This contrasts with the company’s other US asset, the Logan Complex, which has been idled due to persistent structural challenges in the High Volatile (High Vol) coal market.

Logan Complex Idled and Impairment Expected

Logan’s performance has been hampered by reduced European steel production, shifting trade flows, and intense competition in Asian markets, leading to constrained sales pathways and pricing pressure. The company issued a WARN Act notice in February signaling potential idling, which has since been implemented. Coronado is actively exploring strategic options for Logan, including potential disposal, aiming to minimise holding costs and preserve flexibility.

Reflecting these challenges, Coronado expects to record a non-cash impairment of approximately US$160 million for Logan in the quarter, subject to audit review. This move aligns with the company’s focus on preserving liquidity and shareholder value amid a structurally challenged market segment.

Curragh Mine Weather-Impacted but Positioned for Recovery

In Australia, the Curragh Complex faced temporary coal recovery constraints due to weather and a planned two-week Coal Handling Preparation Plant (CHPP) shutdown. Overburden removal progressed well, boosting pit inventories and setting the stage for stronger coal availability later in the year. The Mammoth underground mine was temporarily paused following a fatal incident in January but has since resumed operations, contributing to improved site resilience and recovery capability.

Despite a 44.4% drop in saleable production quarter on quarter, Curragh benefited from a reset of the Stanwell thermal coal arrangements, which delivered approximately US$26 million in cash benefits during the quarter. This reset has materially improved Coronado’s cash flow and liquidity position, supporting the company’s disciplined capital management approach.

Market Dynamics and Financial Outlook

Metallurgical coal prices strengthened in early 2026, with the Premium Low Volatile Hard Coking Coal (PLV HCC) FOB Australian index averaging around US$220 per tonne in March, supported by supply tightness and geopolitical factors including the Middle East conflict. Coronado’s realised met coal price rose 11.2% quarter on quarter to US$165.4 per tonne, reflecting a stronger export mix and improved product quality, particularly from Buchanan.

However, unit costs increased temporarily due to lower production volumes, fixed-cost absorption, and higher diesel prices, especially affecting Curragh’s open-pit operations. The company expects these costs to normalise as production rates improve through the second half of 2026. Capital expenditure remained tightly controlled at approximately US$34 million for the quarter, consistent with the company’s focus on cash preservation.

Coronado ended the quarter with available liquidity of US$120 million and retained access to short-term working capital facilities totaling an estimated US$95 million. The company’s strategic focus remains on operational execution, cost discipline, and cash flow generation, with expectations of progressively stronger financial performance in the coming quarters.