SXC 10-K & 10-Q changes, risk factors and insider trading

Our cokemaking and logisticsindustrial services businesses are subject to operating risks, some of which are beyond our control. Equipment failures or deterioration of assets, may lead to major incidents, production curtailments, shutdowns, impairments, or additional expenditures, which could materially and adversely affect our results of operations and financial condition.

Factors beyond our control could disrupt our cokemaking and logisticsindustrial services operations, adversely affect our ability to service the needs of our customers and increase our operating costs, all of which could have a material and adverse effect on our results of operations. Adverse developments at our cokemaking facilities could significantly disrupt our ability to produce and supply coke, steam, and/or electricityenergy to our customers. Adverse developments at our logisticsindustrial services operations could significantly disrupt our ability to provide scrap handling and sales, slag handling and sales, metals recovery, labor, handling, mixing, storage, terminalling, transloading and/or transportation services, of coal and other dry and liquid bulk commodities, to our customers. Our operations depend upon critical pieces of equipment that occasionally may be out of service for scheduled upgrades or maintenance or as a result of unanticipated failures. Assets and equipment critical to these operations also may deteriorate or become depleted materially sooner than we currently estimate, resulting in additional maintenance spending or additional timely replacement capital expenditures.

Our cokemaking and logisticsindustrial services operations are subject to significant hazards and risks, any of which could result in production and transportation difficulties and disruptions, equipment failures and risk of catastrophic loss, non-compliance with our operating permits, pollution, personal injury or wrongful death claims and other damage to our properties and the property of others. Such hazards and risks include, but are not limited to:

•fire, explosion, or other major incident causing injury to personnel and/or equipment that causes a cessation, or significant curtailment, of all or part of our cokemaking or logisticsindustrial services operations at a site for a period of time;

•processing and plant equipment failures or malfunction, operating hazards and unexpected maintenance problems affecting our cokemaking or logisticsindustrial services operations, or our customers; and

•adverse weather conditions and natural disasters, such as severe winds, heavy rains or snow, flooding, extreme temperatures and other natural events, including those resulting from climate change, affecting our cokemaking or logisticsindustrial services operations, transportation, or our customers; and

The financial performance of our cokemaking and logisticsindustrial services businesses is substantially dependent upon a limited number of customers, and the loss of any of these customers, or any failure by them to perform under their contracts with us, could materially and adversely affect our financial condition, permit compliance, results of operations and cash flows.

Substantially all of our sales are made to a limited number of customers. We expect these customers, and/or their respective successors in interest, by operation of merger, or otherwise, to continue to account for a significant portion of our revenues for the foreseeable future.

We are subject to the credit risk of our major customers and other parties. If we fail to adequately assess the creditworthiness of existing or future customers or unanticipated deterioration of their creditworthiness, any resulting increase in nonpayment or nonperformance by them could have a material adverse effect on our cash flows, financial position or results of operations. During periods of weak demand for steel or coal, our customers may experience significant reductions in their operations, or substantial declines in the prices of the steel, or coal products, they sell. These and other factors such as labor relations or bankruptcy filings may lead certain of our customers to seek renegotiation or cancellation of their existing contractual commitments to us, or reduce their utilization of our services.

The loss of any of these customers (or financial difficulties at any of these customers, which result in nonpayment or nonperformance) could have a significant adverse effect on our business. If one or more of these customers were to significantly reduce its purchases of coke or logisticsindustrial services from us without a make-whole payment, or default on their agreements with us, or terminate or fail to renew their agreements with us, or if we were unable to sell such coke or logisticsprovide industrial services to these customers on terms as favorable to us as the terms under our current agreements, our cash flows, financial position, permit compliance, or results of operations could be materially and adversely affected.

We face competition, both in our cokemaking operations and in our logisticsindustrial services business, which has the potential to reduce demand for our products and services, and that could materially and adversely affect our financial condition and results of operations.

We face competition, both in our cokemaking operations and in our logisticsindustrial services business:

•LogisticsIndustrial services business: Other logistics facilities and independent terminal operations in some areas may compete directly with our logistics facilities. In some markets, trucks may competitively deliver products to certain shorter-haul destinations, resulting in reduced utilization of existing terminal capacity. In the future, additional logistics facilities and terminals with rail and/or barge access may be constructed in the Gulf Coast and East Coast regions, and such additional facilities and terminals could compete directly with us in specific markets now served by our CMT and KRT facilities, respectively. Other logistics facilities, both global and domestic, may compete with our coal handling exports out of the Gulf Region, which may reduce the demand for our CMT facility. In addition, decreased throughput and utilization of our logistics assets could result indirectly due to competition in: (i) the electrical power generation business from abundant and relatively inexpensive supplies of natural gas displacing thermal coal as a fuel for electrical power generation by utility companies; (ii) the steel industry from processes such as electric arc furnaces, or blast furnace injection of pulverized coal or natural gas reducing demand for metallurgical coals handled through our logistics facilities; and/or (iii) the barge unloading business from service alternatives, such as mid-stream operations. In addition, other companies may be able to provide services to our customers at the same or reduced cost. Any reduction in domestic or global demand for steel has the potential to reduce the need for our industrial services operations. These factors have the potential to reduce demand for our services and slag sales and could materially and adversely affect our financial condition and results of operations.

We are subject to extensive environmental, health, and safety laws and regulations, which may increase our cost of doing business and have an adverse effect on our cash flows, financial position, or results of operations.

Our operations are subject to strict regulation by federal, state and local authorities with respect to: discharges of substances into the surrounding environment including the air, water and ground; emissions of GHGs; compliance with the NAAQS and other emissions standards; management and disposal of hazardous substances and wastes; cleanup of contaminated sites; protection of surface water and groundwater quality and availability; and protection of plants and wildlife; reclamation and restoration of properties after completion of mining or drilling; sales of electric power; installation of safety equipment in our facilities; and protection of employee health and safety. For a description of environmental laws and matters applicable to us and associated risks, see “Item 1. Business-Legal and Regulatory Requirements.”wildlife.

Failure to comply with applicable laws, regulations or permits may result in the assessment of administrative, civil and criminal penalties, the imposition of cleanup and site restoration costs and liens, the issuance of injunctions to limit or cease operations, the suspension or revocation of permits and other enforcement measures that could cause delays in permitting or development of projects or materially limit, or increase the cost of, our operations. We may not have been, or may not be, at all times, in complete compliance with all such requirements, and we may incur material costs or liabilities in connection with such requirements, or in connection with remediation at sites we own, or third-party sites where it has been alleged that we have liability, in excess of the amounts we have accrued. In addition, such regulatory requirements, including those related to GHGs, and various CAA programs, may change in the future in a manner that could result in substantially increased capital, operating and compliance costs, materially and adversely affecting our cash flows, financial condition, or results of operations.

Our operations result in emissions of various substances to the air, including GHGs and hazardous air pollutants. Our operations also generate solid and hazardous waste. We have in the past and could in the future be subject to claims under federal, state and local laws and regulations arising from these activities, including for the investigation and clean-up of soil, surface water, or groundwater. Some environmental laws also can impose liability regardless of fault or legality at the time in question, including the characterization of materials. We previously have been and could again in the future be subject to litigation for alleged personal injury or property damage arising from claimed exposure to emissions or hazardous substances allegedly used, released, or disposed of by us, as well as litigation related to climate change by governments, private entities, or individuals. We make every effort to avoid litigation. However, such matters are not totally within our control, and due to the inherently uncertain nature of litigation, we cannot predict the outcome of such matters. Environmental impacts resulting from our operations, including exposures to emissions, hazardous substances, or wastes associated with our operations, could result in costs and liabilities that could adversely impact our financial condition and results of operations.

We may be unable to obtain, maintain or renew permits or leases necessary for our operations, and may become subject to new and more stringent regulations, which could materially and adversely affect our production, cash flows or profitability.

Our cokemaking and logisticsindustrial operationsservices requireoperations, us to obtain a number of permits that impose strict regulations on various environmental and operational matters. These, as well as our facilities and operations (including our generation of electricity),electricity, require us to comply with numerous regulations and maintain a number of permits issued by various federal, state and local agencies and regulatory bodies.bodies that impose strict requirements on various environmental and operational matters. Our industrial services operations are in some cases dependent upon the permits of the steel mill customers where they operate. The regulations, permitting rules, and the interpretations of these regulations and rules, are complex, change frequently, and are often subject to discretionary interpretations by our regulators, all of which may make compliance more costly, difficult or impractical, and may possibly preclude the continuance of ongoing operations or the development of future cokemakingcokemaking, energy generation, and/or logisticsindustrial services facilities. For example, the United States Environmental Protection Agency finalized stringent new Clean Air Act Maximum Achievable Control Technology standards in 2024 that are now being litigated and reconsidered by the agency. Non-governmental organizations, environmental groups and individuals have certain rights to engage in the regulatory and permitting process, and may comment upon, or object to, the regulatory changes and requested permits. Such persons may also have the right to bring citizen’s lawsuits to challenge the issuanceregulatory changes and renewal of permits, or the validity of environmental evaluations related thereto. If any permits or leases are not issuedrenewed, or if regulations are promulgated or renewed in a timely fashion or at all, or if permits issued or renewed are conditioned in a manner that restricts our ability to efficiently and economically conduct our operations, it could have a material and adverse effect on our financial condition and results of operations. Similarly, the Federal Energy Regulatory Commission (“FERC”) regulates the sales of electricity from our Haverhill and Middletown facilities, exempts the facilities from certain requirements under the Public Utility Regulatory Policies Act of 1978 (“PURPA”), and grants requests for authority to sell electricity from these facilities at market-based rates. Changes to the interpretation and application of these rules by FERC may occur from time to time, and could adversely impact the future results of our power generation business.

We maintain insurance policies that provide limited coverage for some, but not all, potential risks and liabilities associated with our business. We may not obtain insurance if we believe the cost of available insurance is excessive relative to the risks presented. As a result of market conditions, premiums and deductibles for certain insurance policies can increase substantially, and in some instances, certain insurance may become unavailable or available only for reduced amounts of coverage. As a result, we may not be able to renew our existing insurance policies or procure other desirable insurance on commercially reasonable terms, if at all. In addition, certain risks, such as certain environmental and pollution risks, and certain cybersecurity risks, generally are not fully insurable. We must compensate employees for work-related injuries. If we do not make adequate provision for our workers' compensation liabilities, or we are pursued for applicable sanctions, costs, and liabilities, our operations and our profitability could be adversely affected. Even where insurance coverage applies, insurers may contest their obligations to make payments. Our financial condition, results of operations and cash flows could be materially and adversely affected by losses and liabilities from un-insureduninsured or under-insured events, as well as by delays in the payment of insurance proceeds, or the failure by insurers to make payments.

Our operations require a reliable supply of equipment, replacement parts and metallurgical coal. If the cost to produce coke and provide logisticsindustrial services increases due to price or usage, including cost of supplies, equipment, metallurgical coal or labor, and we cannot pass such increases in our costs of production to our customers, our profit margins may be reduced and our financial condition, results of operations and cash flows may be adversely affected.

Our success depends, in part, on the quality, efficacy and safety of our productsoperations and services. If our operations or services do not meet applicable safety standards, or our products or services are found to be unsafe, our relationships with customers could suffer and we could lose business or become subject to liability or claims. In addition, our cokemaking and logisticsindustrial services operations have inherent safety risks that may give rise to events resulting in death, injury, or property loss to employees, customers, or unaffiliated third parties. Depending upon the nature and severity of such events, we could be exposed to significant financial loss, reputational damage, potential civil or criminal government or other regulatory enforcement actions, or private litigation, the settlement or outcome of which could have a material and adverse effect on our financial condition or results of operations.

We are subject to various climate-related risks. Various policymakers have adopted, or are considering adopting, regulations regarding GHGs, particularly from fossil fuels, which are integral to our cokemaking and logisticsindustrial services businesses. Such regulations range from provisions to reduce GHG emissions, either directly or indirectly (such as through carbon pricing), to requirements for disclosure of climate-related information, any of which may result in substantial compliance costs. Moreover, pressure to reduce GHG emissions may also contribute to competition with alternatives to our products.

If a substantial portion of our agreements to supply coke, electricity,energy, and/or steam are modified or terminated,terminated or a contract is breached, our cash flows, financial position, permit compliance, results of operations and/or carrying value of our long-lived assets may be adversely affected if we are not able to replace such agreements, or if we are not able to enter into new agreements at the same level of profitability.

We make substantially all of our coke, electricityenergy and steam sales under long-term agreements. If a substantial portion of these agreements are modified or terminated or if force majeure is exercised,exercised or a contract is breached, our results of operations may be adversely affected if we are not able to replace such agreements, or if we are not able to enter into new agreements at the same level of profitability. The profitability of our long-term coke, energy and/or steam sales agreements depends on a variety of factors that vary from agreement to agreement and fluctuate during the agreement term. We may not be able to obtain long-term agreements at favorable prices, compared either to market conditions or to our cost structure. Price changes provided in long-term supply agreements may not reflect actual increases in production costs. As a result, such cost increases may reduce profit margins on our long-term coke and energy sales agreements. In addition, contractual provisions for adjustment or renegotiation of prices and other provisions may increase our exposure to short-term price volatility.

From time to time, we discuss the extension of existing agreements and enter into new long-term agreements for the supply of coke, steam, and energy to our customers, but these negotiations may not be successful and these customers may not continue to purchase coke, steam,energy, or electricitysteam from us under long-term agreements. In addition, declarations of bankruptcy by customers can result in changes in our contracts with less favorable terms. If any one or more of these customers were to become financially distressed and unable to pay us, significantly reduce their purchases of coke, steam,energy, or electricitysteam from us, or if we were unable to sell coke or electricityenergy to them on terms as favorable to us as the terms under our current agreements, our cash flows, financial position, permit compliance or results of operations may be materially and adversely affected.

Further, because of certain technological design constraints, we do not have the ability to shut downidle our cokemaking operations if we do not have adequate customer demand. If a customer refuses to take or pay for our coke, we mustmay choose to continue to operate our coke ovens even though we may not be able to sell our coke immediately or may incur significant additional operational costs for:and (i)fees natural gasrelated to maintainvendor the temperature inside our coke oven batteries; and (ii) fees under our rail contracts to account for reductions in inbound coal or outbound coke shipments at our plants,contracts, which may have a material and adverse effect on our cash flows, financial position or results of operations.

In some countries, steelmaking capacity exceeds demand for steel products. Rather than reducing employment by matching production capacity to consumption, steel manufacturers in these countries (often with local government assistance or subsidies in various forms) may export steel at prices that are significantly below their home market prices and that may not reflect their costs of production or capital. Our steelmaking customers may decrease the prices they charge for steel, or take other action, as the supply of steel increases. The profitability and financial position of our steelmaking customers may be adversely affected, causing such customers to reduce their demand for our coke and making it more likely that they may seek to renegotiate their contracts with us or fail to pay for the coke they are required to take under our contracts. In addition, future increases in exports of blast furnace and/or foundry coke from China and/or other coke-producing countries also may reduce our customers' demand for coke capacity. Such reduced demand for our coke could adversely affect the certainty of our long-term relationships with our customers, depress blast furnace and/or foundry coke prices, and limit our ability to enter into new, or renew existing, commercial arrangements with our customers, as well as our ability to sell into the North American spot coke and export coke markets, and could materially and adversely affect our future revenues and profitability.

Substantially all of the metallurgical coal used to produce coke at our cokemaking facilities is purchased from third-parties under one-year contracts. We cannot assure that there will continue to be an ample supply of metallurgical coal available that meetmeets our quality specificationsspecifications, or that these facilities will be supplied without any significant disruption in coke production, assafety, economic, environmental, and other conditions outside of our control may reduce our ability to source sufficient amounts of coal for our forecasted operational needs. If we are not able to make up the shortfalls resulting from such supply failures through purchases of coal from other sources, the failure of our coal suppliers to meet their supply commitments could materially and adversely impact our results of operations and, ultimately, impact the structural integrity of our coke oven batteries.

At our Granite City and Haverhill cokemaking facilities, we rely on third-parties to mix coals that we have purchased into coal mixesblends that we use to produce coke. We have entered into agreements with coal mixing service providers that are coterminous with our coke sales agreements. However, thereThere are limited alternative providers of coal mixing services and any disruptions from our current service providers could materially and adversely impact our results of operations. In addition, if our rail transportation agreements are terminated, we may have to pay higher rates to access rail lines or make alternative transportation arrangements.

Our coke production obligations at our Jewell cokemaking facility and our Haverhill cokemaking facility require us to deliver coke to certain customers via railcar. We have entered into long-termannual rail transportation agreements to meet these obligations. Disruption of these transportation services because of weather-related problems, including those related to climate change, mechanical difficulties, train derailments, infrastructure damage, strikes, lock-outs, lack of fuel or maintenance items, fuel costs, transportation delays, accidents, terrorism, domestic catastrophe or other events could temporarily, or over the long-term, impair our ability to produce coke, and therefore, could materially and adversely affect our business and results of operations.

Risks Related to Our LogisticsIndustrial Services Business

The growth and success of our logisticsindustrial services business depends upon our ability to find and contract foron-site scrap and slag handling and processing services as well as adequate throughput volumes, and an extended decline in demand for these services and coal could affect the customers for our logisticsindustrial services business adversely. As a consequence, the operating results and cash flows of our logisticsindustrial services business could be materially and adversely affected.

The financial results of our logisticsindustrial services business segment are significantly affected by the ability to secure contracts for on-site scrap and slag handling and processing as well as the demand for both thermal coal and metallurgical coal. An extended decline in our customers’ demand for eitherthese services and thermal or metallurgical coals, including as a result of cyclical downturns as well as legislation or regulations promoting renewable energy or limiting carbon emissions from the energy sector, could result in a reduced need for the coalmaterial mixing, terminallinghandling and/or transloadingmixing services we offer, thus reducing throughput and utilization of our logisticsindustrial services assets. Demand for such coalsservices may fluctuate due to factors beyond our control:

Additionally, fluctuations in the market price of coal can greatly affect production rates and investments by third-parties in the development of new and existing coal reserves. Mining activity may decrease as spot coal prices decrease. We have no control over the level of mining activity by coal producers, which may be affected by prevailing and projected coal prices, demand for hydrocarbons, the level of coal reserves, geological considerations, governmental regulation and the availability and cost of capital. A material decrease in coal mining production in the areas of operation for our logisticsindustrial services business, whether as a result of depressed commodity prices or otherwise, could result in a decline in the volume of coal processed through our logisticsindustrial services facilities, which would reduce our revenues and operating income.

Decreased demand for thermal or metallurgical coals, and extended or substantial price declines for coal could adversely affect our operating results for future periods and our ability to generate cash flows necessary to improve productivity and expand operations. The cash flows associated with our logisticsindustrial services business may decline unless we are able to secure new volumes of coal or other dry bulk products, by attracting additional customers to these operations. Future growth and profitability of our logisticsindustrial services business segment will depend, in part, upon whether we can contract for additional coal and other bulk commodity volumes at a rate greater than that of any decline in volumes from existing customers. Accordingly, decreased demand for coal, or other bulk commodities, or a decrease in the market price of coal, or other bulk commodities, could have a material adverse effect on the results of operations or financial condition of our logisticsindustrial services business.

We returned meaningful capital to our shareholders through the declaration and payment of a dividend during each quarter of 2024, increasing from $0.10 per share during the first half of the year to $0.12 per share during theeach second halfquarter of the year, representing a quarterly increase of 20 percent.2025.

•Granite City Contract Extension. In OctoberJanuary 2024,2026, the Granite City long-term, take-or-pay agreement with United States Steel Corporation (“U.S. Steel”) was extended through JuneDecember 30,31, 2025, with an option for U.S. Steel to extend for an additional six months.2026. Under the terms ofextension, the agreement, Granite CityCompany will supplyprovide 295590 thousand tons of cokemetallurgical coke. The provisions and economics of this extension remain similar to U.S.those Steelincluded duringin the initialprevious sixextensions month term. The terms of the extension includes a turn down fee, but resultsexecuted in significantly2024 lowerand overall economics compared to the current long-term, take-or-pay agreement. Other key provisions of the agreement, including the pass-through of coal costs, remain unchanged.2025.

•U.S. Department of Labor’s Division of Coal Mine Workers Compensation (“DCMWC”) Regulatory Exemption. In August 2024, the Company reached an agreement with the DCMWC and made a payment of $36.0 million to extinguish the majority of its self-insured federal black lung liabilities. As a result of the agreement, the Company recognized a $9.5 million pre-tax gain within selling, general and administrative expenses on the Consolidated Statements of IncomeOperations during the year ended December 31, 2024. The agreement resulted in a reduction of $45.5 million of the Company's black lung liability on the Consolidated Balance Sheets. See Note 1213 to our consolidated financial statements for further detail.

Selling, General and Administrative Expenses. The decrease in selling,Selling, general and administrative expenseexpenses wasincreased primarilyduring impacted2025, byreflecting transaction costs of $10.1 million incurred related to the recognitionacquisition of Phoenix Global as well as the absence of a $9.5 million gain, which was the result of the extinguishment of certain liabilities related to our legacy coal mining business.business in the prior year period. See Note 1213 to our consolidated financial statements for further detail. Additionally, selling, general and administrative expenses during 2025 further increased due to the inclusion of Phoenix Global's costs in the current year period. These increased costs were partially offset by lower employee related expenses and lower legal expenses in the current year period.

Depreciation and Amortization Expense. DepreciationThe increase to depreciation and amortization expense decreasedduring 2025 reflects the inclusion of Phoenix Global's expense in 2024the ascurrent comparedyear toperiod. 2023This asincrease awas resultpartially ofoffset by the expiration of the useful lives of assets in our Domestic Coke segment, which weresegment placed into service in prior periods.

We report our business results through threetwo reportable segments:

•Domestic Coke consists of our Jewell facility, located in Vansant, Virginia, our Indiana Harbor facility, located in East Chicago, Indiana, our Haverhill facility, located in Franklin Furnace, Ohio, our Granite City facility located in Granite City, Illinois, and our Middletown facilityand Haverhill facilities located in Middletown, Ohio.

•LogisticsIndustrial Services consists of logistics terminals including CMT, located in Convent, Louisiana, KRT, located in Ceredo and Belle, West Virginia, and Lake Terminal, located in East Chicago, Indiana. Lake Terminal is located adjacent to our Indiana Harbor cokemaking facility. Additionally, Industrial Services includes fifteen molten slag removal, handling and processing operating sites across the United States, Brazil, Slovakia and Spain.

Corporate expenses that can be identified with a segment have been included in determining segment results. The remainder is included in Corporate and Other, including licensing and operating fees payable to us under long-term contracts with ArcelorMittal Brazil as well as the expenses related to those operations and activity from our legacy coal mining business, which is not considered a reportable segment and,and therefore, not included in our segment information in Note 19.20. However, we have included Corporate and Other within our operating data below.

Management believes Adjusted EBITDA is an important measure of operating performance, which is used by the chief operating decision maker as one of the measurements to help determine the allocation of costs and resources to our reportable segments. Adjusted EBITDA should not be considered a substitute for the reported results prepared in accordance with GAAP. See the “Non-GAAP Financial Measures” section below for both the definition of Adjusted EBITDA and the reconciliation from GAAP to the non-GAAP measurement.

(1)Corporate and Other, net is not a reportable segment.segment and includes the results of Brazil cokemaking operations.

(3)Operating and maintenance costs primarilyduring 2025 benefited from lower planned maintenance outage costs in the current year periodas fromwell lower planned outage costs andas the absencetiming of ovenother rebuilds.maintenance costs.

(4)Energy and other decreasedincreased primarilydue to favorable energy pricing, which was partially offset by lower energy sales volumes as a result of unfavorableenergy-generating energyasset pricing. These decreases were partially offset by higher energy sales as a result of increased volumes related to upgrades of our assets madeoutages in the priorcurrent year period.

Corporate and Other Adjusted EBITDA increased $10.2 million, or 31 percent, torepresented a loss of $22.2$13.1 million in 20242025 compared to a loss of $32.4$12.3 million in 2023.2024. This increase was primarily driven by the recognitionabsence of a $9.5 million gain, which was the result of the extinguishment of certain liabilities related to our legacy coal mining business.business Seein Notethe 12prior toyear ourperiod. consolidatedThese financialincreases statementswere forpartially furtheroffset detail.during 2025 by lower employee related expenses and lower legal expenses.

The Company evaluates the performance of its segments based on segment Adjusted EBITDA, which is defined as earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted for any impairments, restructuring costs, gains or losses on extinguishment of debt, gains or losses on derivative instruments, site closure costs and/or transaction costs (“Adjusted EBITDA”). EBITDA and Adjusted EBITDA do not represent and should not be considered alternatives to net income or operating income under GAAP and may not be comparable to other similarly titled measures in other businesses.

Below is a reconciliation of Adjusted EBITDA to net (loss) income, which is its most directly comparable financial measure calculated and presented in accordance with GAAP:

(13)Reflects costs incurred related to potentialthe mergersPhoenix andGlobal acquisitionsacquisition and the granulated pig iron project with U.S. Steel.

Our primary liquidity needs are to fund working capital,capital fundand investments, service our debt, maintain cash reserves and replace partially or fully depreciated assets and other capital expenditures. Our sources of liquidity include cash generated from operations, borrowings under our revolving credit facility (“Revolving Facility”) and, from time to time, debt and equity offerings. We believe our current resources are sufficient to meet our working capital requirements for our current business for at least the next 12 months and thereafter for the foreseeable future. We funded the acquisition of Phoenix Global with existing cash and borrowing availability under our Revolving Facility. As of December 31, 2024,2025, we had $189.6$88.7 million of cash and cash equivalents and $350.0$132.0 million of borrowing availability under our Revolving Facility.

The following table sets forth a summary of the net cash provided by (used in) provided by operating, investing and financing activities for the years ended December 31, 20242025 and 20232024:

Cash ProvidedFlows byfrom Operating Activities

This Quarterly Report on Form 10-Q for the quarter ended MarchJune 31,30, 2026 (this “Quarterly Report on Form 10-Q”) contains certain forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This discussion contains forward-looking statements about our business, operations and industry that involve risks and uncertainties, such as statements regarding our plans, objectives, expected future developments, expectations and intentions, and they involve known and unknown risks that are difficult to predict. As a result, our future results and financial condition may differ materially from those we currently anticipate as a result of the factors we describe in our filings with the Securities and Exchange Commission (the “SEC”), including our Annual Report on Form 10-K for the year ended December 31, 2025 (the “Annual Report on Form 10-K”), and as updated in this Quarterly Report on Form 10-Q, and other quarterly and current reports, which are on file with the SEC and are available at the SEC's website (www.sec.gov). Additionally, please see our “Cautionary Statement Concerning Forward-Looking Statements” located elsewhere in this Quarterly Report on Form 10-Q.

FirstSecond Quarter Key Financial Results

Operating results for the three and six months ended MarchJune 31,30, 2026 reflect favorable coal-to-coke yields and terminals handling volumes. These increases were partially offset by lower volumes due to the shutdown of our Haverhill I cokemaking facility as well as the impact of severe winter weather and lower energy revenues due to the turbine failure at our Middletown cokemaking facility. Additionally, operating results for the six months ended June 30, 2026 were negatively impacted by lower pricing on our foundry sales. Operating results for the three and six months ended MarchJune 31,30, 2026 also include the results of Flame Aggregator, LLC (“Phoenix Global”). Operating cash flows during the current period primarily reflect favorable changes in primary working capital. See detailed analysis of the quarter's results throughout this MD&A.Global.

The following table sets forth amounts from the Consolidated Statements of Operations for the three and six months ended MarchJune 31,30, 2026 and 2025, respectively:

Sales and Other Operating Revenue and Costs of Products Sold and Operating Expenses.Revenue. Sales and other operating revenue and costs of products sold and operating expenses increased for the three and six months ended MarchJune 31,30, 2026 compared to the same prior year period,periods, driven by the inclusion of Phoenix Global results. ThisThese increaseincreases waswere partially offset by lower volumes as a result of the shutdown of our Haverhill I cokemaking facility, lower blast coke sales volumes due to the impact of severe winter weather, lower energy revenues due to the turbine failure at our Middletown cokemaking facility and the pass-through of lower coal prices on our long-term, take-or-pay agreements. Additionally, sales and other operating revenue for the six months ended June 30, 2026 was negatively impacted by lower pricing on our foundry sales.

Selling, General and Administrative Expenses. Selling, general and administrative expenses increased during the three and six months ended MarchJune 31,30, 2026 reflecting the inclusion of Phoenix Global costs andcosts, costs incurred associated with the shutdown of our Haverhill I cokemaking facility.facility and higher employee-related costs.

Depreciation and Amortization Expense. The increase to depreciation and amortization expense for the three and six months ended MarchJune 31,30, 2026 reflects the inclusion of Phoenix Global's expenseexpenses in the current year period.periods.

Interest Expense, Net. Interest expense, net, during the three and six months ended MarchJune 31,30, 2026 increased as a result of interest incurred on higher Revolving Facility borrowings.

Income Tax (Benefit) Expense. Income taxestax wereexpense a benefitincreased during the three months ended MarchJune 31,30, 2026 compared to the same prior year period as a result of thehigher pretax lossincome inand decreased during the currentsix months ended June 30, 2026 compared to the same prior year period,period due to lower pretax income, driven by the factors previously discussed, compared to pretax income in the comparative prior year period.discussed. See Note 5 Income Taxes to our consolidated financial statements for further detail.

(1)Volumes during the three and six months ended MarchJune 31,30, 2026 decreased due to the shutdown of our Haverhill I cokemaking facility as well as lower blast coke sales volumes as a result of severe winter weather.facility.

(2)The pass-through of lower coal prices decreased sales and other operating revenue during the three and six months ended MarchJune 31,30, 2026. Sales and other operating revenue and Adjusted EBITDA for the three and six months ended MarchJune 31,30, 2026 decreasedincreased asdue ato resultfavorable ofcoal-to-coke lower pricing on our foundry sales.yields.

(3)Energy and other during the three and six months ended MarchJune 31,30, 2026 decreased due to the turbine failure at our Middletown cokemaking facility, which wasfacility partially offset by favorable pricing during the current year period.periods.

During the three and six months ended MarchJune 31,30, 2026, sales and other operating revenues, exclusive of intersegment sales, were $85.4$98.4 million and $183.8 million, respectively, compared to $22.4$15.1 million and $37.5 million, respectively, in the corresponding prior year period.periods. Adjusted EBITDA, inclusive of the impact of intersegment transactions, during the three and six months ended MarchJune 31,30, 2026 was $26.2$34.4 million and $60.6 million, respectively, compared to $13.7$7.7 million and $21.4 million, respectively, in the corresponding prior year period.periods. Industrial services results increased during the current year periodperiods due to the inclusion of Phoenix Global results,results partiallyand offset by lowerfavorable transloading volumes.volumes and pricing.

Corporate and Other Adjusted EBITDA represented a loss of $5.0$7.3 million and $12.3 million, respectively, for the three and six months ended MarchJune 31,30, 2026, compared to a loss of $3.8$4.6 million and $8.4 million, respectively, in the corresponding prior year period.periods. The three and six months ended MarchJune 31,30, 2026 reflect higher employee related expenses.

The Company evaluates the performance of its segments based on segment Adjusted EBITDA, which is defined as earnings before interest, taxes, depreciation and amortization (“EBITDA”), adjusted for any impairments, restructuring costs, gains or losses on extinguishment of debt, gains or losses on foreign currency derivative instruments,instruments assumed as part of the acquisition of Phoenix Global, site closure costs and/or transaction costs (“Adjusted EBITDA”). EBITDA and Adjusted EBITDA do not represent and should not be considered alternatives to net income or operating income under GAAP and may not be comparable to other similarly titled measures in other businesses.

Management believes Adjusted EBITDA is an important measure in assessing operating performance. Adjusted EBITDA provides useful information to investors because it highlights trends in our business that may not otherwise be apparent when relying solely on GAAP measures and because it eliminates items that have less bearing on our operating performance. EBITDA and Adjusted EBITDA are not measures calculated in accordance with GAAP, and they should not be considered a substitute for net income, or any other measure of financial performance presented in accordance with GAAP. Additionally, other companies may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.

Our primary liquidity needs are to fund working capital and investments, service our debt, maintain cash reserves and replace partially or fully depreciated assets and other capital expenditures. Our sources of liquidity include cash generated from operations, borrowings under our Revolving Facility and, from time to time, debt and equity offerings. We believe our current resources are sufficient to meet our working capital requirements for our current business for at least the next 12 months and thereafter for the foreseeable future. As of MarchJune 31,30, 2026, we had $104.4$42.7 million of cash and cash equivalents and $158.0$164.5 million of borrowing availability under our Revolving Facility.

The following table sets forth a summary of the net cash provided by (used in) operating, investing and financing activities for the threesix months ended MarchJune 31,30, 2026 and 2025:

Net cash provided by operating activities increased by $46.9$2.2 million to $72.7$45.5 million for the threesix months ended MarchJune 31,30, 2026 as compared to $25.8$43.3 million in the corresponding prior year period. TheNet increasecash provided by operating activities during the current period primarily reflects favorableunfavorable changes in primary working capital,capital whichdriven isby comprisedthe timing of accountscustomer receivable,payments inventories,partially and accounts payable, drivenoffset by lower coal inventoryinventory. volumes.Current period cash flows from operating activities also includes the results of Phoenix Global.

Net cash used in investing activities increased by $11.1$12.4 million to $15.7$29.6 million for the threesix months ended MarchJune 31,30, 2026 as compared to $4.6$17.2 million in the corresponding prior year period. The increase is primarily related to the inclusion of capital expenditures for Phoenix Global in the current year period. This increase was partially offset by $1.8 million received primarily related to the settlement of final working capital for the Phoenix Global acquisition during the current year period. Refer to “Capital Requirements and Expenditures” below for further detail.

Net cash used in financing activities increased by $24.2$32.4 million to $41.3$61.9 million for the threesix months ended MarchJune 31,30, 2026 as compared to $17.1$29.5 million in the corresponding prior year period. The increase in net cash used in financing activities was primarily driven by net repayments of $26.0$32.5 million on the Revolving Facility and an increase in repayments of finance lease liabilities of $1.8$2.8 million. These increases in the current year period were partially offset by lower cash distributions made to noncontrolling interests of $1.5 million as well as lower cash remittances of $2.0$1.9 million for taxes related to vestings on equity classified awards.

Additionally, onOn April 30, 2026, SunCoke's Board of Directors declared a cash dividend of $0.12 per share of the Company's common stock. This dividend will bewas paid on June 2, 2026, to stockholders of record on May 15, 2026.

As of MarchJune 31,30, 2026, we were in compliance with all applicable debt covenants. We do not anticipate a violation of these covenants nor do we anticipate that any of these covenants will restrict our operations or our ability to obtain additional financing. See Note 7 to the consolidated financial statements for details on debt covenants.

There have been no significant changes to our accounting policies or estimates during the three months ended MarchJune 31,30, 2026 compared with those disclosed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2025.