SunCoke Energy Inc.
) posted fourth quarter and full year 2012 results. In the fourth
quarter, earnings per share of 39 cents beat the Zacks Consensus
Estimate of 34 cents. The bottom line was 225% higher than the
prior-year figure of 12 cents.
For full year 2012, the company reported earnings of $1.40 per
share, handily beating the Zacks Consensus Estimate of $1.35 per
share and the year-ago figure of 87 cents.
The results were driven by operations at Middletown, improved
performance at Indiana Harbor and continued strong performance
across the entire U.S. cokemaking fleet.
In the fourth quarter of 2012, total revenue was $491.4 million,
up 15.9% year over year. The top line was also above the Zacks
Consensus Estimate of $473 million. In full year 2012, the top
line surged 24.4% year over year to $1,914.1 million. It also
exceeded the Zacks Consensus Estimate of $1,907 million. The
top-line growth was driven by sales at the new Middletown
facility and higher coal prices. Operations at Middletown began
in Oct 2011.
In 2012, coal production was up 8.2% year over year to 1.5
In the fourth quarter, adjusted earnings before interest, tax
depreciation and amortization (EBITDA) was up 125.6% year over
year to $69.7 million.
Total costs and operating expenses in the reported quarter were
up 8.4% year over year to $447.1 million. In the reported
quarter, net income was $27.6 million, up 245% year over year. In
2012, net income was $98.8 million, up 63% year over year.
In the fourth quarter of 2012, revenue from Jewell Coke was $69.6
million, up 15% year over year. Other Domestic Coke generated
revenue of $390.6 million, up 18.3% year over year. Revenue
from International Coke was $9.6 million, up 7.9% year over year.
The coal mining segment generated revenue of $10.8 million, down
24.5% year over year. Other Income, net was $10.8 million, up
5.9% year over year.
As of Dec 31, 2012, cash and cash equivalents were $239.2
million, up from $127.5 million as of Dec 31, 2011. Properties,
plants and equipment, net were $1,396.6 million, up from $1,391.8
million at the end of Dec 31, 2011. Long-term debt was $720.1
million, down 0.4% year over year. Net cash from operating
activities was $206.1 million, up from $101.3 million in full
For 2013, the company expects coal production to be approximately
1.4 million tons. It expects adjusted EBITDA to be between $205
million and $230 million and earnings per share in the range of
30 cents to 55 cents.
SunCoke came up with a striking performance this quarter, easily
surpassing the consensus. 2012 adjusted EBITDA of $265.7 million,
earnings per share of $1.40 and free cash flow were well within
the company's guidance.
However, the company failed to achieve its coal mining business
guidance on account of the weak coal market environment. Since a
part of the revenue comes from coal mining operations, the weak
coal market could adversely impact the top and the bottom line of
the company, going forward. Moreover, unfavorable economic
conditions and laws and regulations remain a matter of concern
for the company. The company presently retains a short-term Zacks
Rank #5 (Strong Sell).
SunCoke Energy, Inc. is the largest independent producer of coke
in the Americas. It produces high-quality coke with its advanced,
heat recovery cokemaking process. The coke is used in steelmaking
and captures waste heat for derivative energy resale and meets or
exceeds environmental standards.
Other stocks to consider are
Natural Resource Partners LP
) with a short-term Zacks Rank #2 (Buy) and
Alliance Resource Partners LP
Cloud Peak Energy Inc
) with a short-term Zacks Rank #3 (Hold).
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