Welcome to the Ramaco Resources Second Quarter 2023 Earnings Conference Call. At this time, all participants have been placed on a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing star two. Others can hear your questions clearly, we ask that you pick up your handset for best sound quality. Lastly, if you should require operator assistance, please press star zero. I would now like to turn the call over to Jeremy Sussman, Chief Financial Officer. Please go ahead, sir. Thank you. On behalf of Ramaco Resources, I'd like to welcome all of you to our second quarter 2023 earnings conference call. With me this morning is Randy Atkins, our Chairman and CEO, and Chris Blanchard, our Chief Operating Officer. Before we start, I'd like to share our normal cautionary statement. Certain items discussed on today's call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent Ramaco's expectations concerning future events. These statements are subject to risks, uncertainties, and other factors, many of which are outside of Ramaco's control, which could cause actual results to differ materially from the results discussed in the forward-looking statement. Any forward-looking statement speaks only as of the date on which it is made, and except as required by law, Ramaco does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. I'd like to remind you that you can find a reconciliation of the non-GAAP financial measures that we plan to discuss today in our press release. This can be viewed on our website, ramacoresources.com. Lastly, I'd encourage everyone on this call to go onto our website and download today's investor presentation under the Events calendar. With that said, let me introduce our Chairman and CEO, Randy Atkins. Thanks, Jeremy. Good morning to everyone, and thanks for joining the call. We have a lot to cover this morning since we last spoke in May. First, during the second quarter, we announced two potentially transformative milestones. In early May, we disclosed that our Brook Mine near Sheridan, Wyoming, may contain the largest known unconventional deposit of rare earth elements in the United States. In late June, our tracking stock, which we call CORE Resources, began trading under the ticker symbol METCB, and will pay its first dividend next month. As an aside, CORE stands for Carbon Ore Rare Earth, which describes some of the unique asset classes included in the stock. We felt that these assets might trade above levels of a typical operating coal company because of a combination of a lower risk profile on the fixed income side, combined with a higher potential return profile from assets like rare earths. CORE is now trading roughly 65% higher than when issued at a roughly 16x EV to EBITDA multiple, and with over a 6% yield. This compares to METC shares, which still trade in line with our coal peers at around 2x-3x EV to EBITDA. Overall, the issuance of the tracking stock has increased our combined market cap of these two stocks by about $120 million or almost 30%. It goes without saying that we are gratified with the support investors have shown for this security in the early going. To expand on the REE front, earlier this week, we reported that our board had approved development mining to start on our Brook Mine project this fall. Our initial efforts will be to recover larger quantities of material that we can chemically analyze to determine the most effective processing, separation, and recovery techniques. This first step does not require large levels of spend, which we have budgeted at $2.5 million over two quarters. This is significant on many fronts, but most importantly, because this is the first new rare earth mine in the U.S. in decades, actually starting to mine. A number of other projects, basically all involving REEs found in hard minerals, are in various states of prospecting or testing, but we are not aware that any have been permitted. Having taken eight years to permit the Brook Mine, we can attest that permitting is no easy step. It provides us an ability to materially be further down the runway in terms of moving the project into reality. We also noted that our current rare earth target, exploration target, is up 50% from our initial estimates in May, to over 1 million tons of TREOs. We expect this target size may increase as we continue more coring and chemical analysis. Even at this size, it seems to contain many decades of REE supply to satisfy almost all current domestic demands. Based upon our ongoing work with Weir and NETL, we believe that almost 30% of the deposit contains magnetic REEs. These are the particular elements that are critical to both defense electronics as well as the energy transition for wind and solar. From limited samples of coring, we've also found large quantities of the two recently banned minerals by China, named gallium and germanium. We are currently doing larger scale testing, specifically on those two minerals, and will include results in our next update. As a reminder, today, almost all REEs are imported from China. We hope to be the only completely, quote, "Made in the USA" brand in the industry. Lastly, we have engaged recently a number of consulting groups specializing in REE assessment, separation, and recovery technologies. This includes a well-known group in this space called SRK Consulting. Together, these groups, along with NETL, will enable us to complete an initial economic analysis and pre-feasibility study. We hope to have initial findings to report before year-end, and we'll provide some guidance on the economics and timing of developments. Now, turning to our core met coal operations. This past quarter, the whole industry faced a number of combined challenges. We saw continued price declines, overall softer market conditions, steel prices hitting lows, and ongoing inflationary pressures. In our investor presentation on the website and accompanying this quarter's earnings, on page 14, we compared how the public groups have reported so far. Earnings from all our peers have clearly reflected this difficult environment. For all reported metallurgical coal companies this quarter, EBITDA fell on an average 42%. We fell 38%. Average peer group mine cost increased by 4%, the same as Ramaco. In general, this was a tough quarter all around. We do not want to make excuses, but I would also note that this quarter, we were again plagued by non-performance by our rail partners. In the month of June, both Norfolk Southern and CSX failed to deliver over 80,000 tons of contracted shipments, which was over 10% of tons sold during the quarter. This set us back $11 million of EBITDA, which rolls forward when they performed in July. On the pricing front, U.S. High Vol A indices averaged 25% less in the second quarter compared to the first. Today, prices are down another 10% from the second quarter. The same time, the U.S. saw inflation of almost 5% in the second quarter. While this is down from a year ago, it has continued to put pressure on the supply chain. These pressures are, of course, not specific to Ramaco. I would point out, however, that when you see margin compression across the industry, Ramaco's first quartile low mine cost profile, combined with our limited ARO exposure, puts us in a strong relative position. On the marketing front, we have now contracted 3.1 million tons, or 95% of our 2023 forecasted production. Of this amount, over 70% or 2.2 million tons, is fixed price business at an average net back of $188 per ton. The balance is priced against a floating index. Today, we have roughly 400,000 of uncommitted tons remaining to place before year-end, and 900,000 of committed but unpriced tons. While worldwide benchmark pricing continues in a summer seasonal lull, our strong contracted position somewhat insulates Ramaco a bit more than those in our peer group with larger open positions. Looking at the second half of 2023, we see some positive company-specific catalysts on the horizon. The first section of the Berwind mine continues to increase current production. The second section is set to begin production before the end of the month. Similarly, production from the Maven surface and highwall mines continue to grow in line with expectations. In late July, after a shakedown period, the Elk Creek prep plant reached full processing capacity of 3 million tons, up 50% from its former nameplate of 2 million tons. Finally, by the fourth quarter, we should be running at over a 4 million ton per year annualized production and sales rate. In the coal space, as we all know, we cannot control price, but we can arguably control production growth and company-specific costs. As mentioned, in the back half, we look forward to an increase in both net production and processing throughput capacity. As a result, we hope to see costs come down, both by being spread across a larger number of produced tons, as well as by taking some affirmative cost control measures, which Chris will comment on. On the Brook REE front, we look forward to starting our development mining in a few months. We are positioning ourselves to try and take advantage of this unique opportunity and look forward to updating everyone as this potentially transformative project unfolds. With this mine, as time goes by, we hope to position ourselves as both a growing low-cost met coal as well as rare earth producer. With that, I will turn the floor over to the rest of the team to discuss more details on finances, markets, and operations. Jeremy, please start with a rundown on our financial metrics and markets. Thank you, Randy. As you noted, the second quarter was challenging across the board for the industry as a whole, as everyone has no doubt already heard from our peers. In fact, I would point to slide 14 that shows our closest peers, saw Q2 EBITDA declined by over 40% on average versus Q1, having missed consensus by over $30 million on average. Our second quarter net income of $8 million was down $18 million from the first quarter of 2023. Diluted EPS of $0.17 was down $0.40. Adjusted EBITDA fell to $30 million versus $48 million in Q1. As noted in our press release, Q2 net income, EPS, and Adjusted EBITDA were negatively affected by $9 million, $0.19, and $11 million, respectively, due to rail transportation non-performance issues. Roughly 85,000 tons that were contracted to ship during the last weeks of the quarter, were pushed to July by CSX and NS. Relative to first quarter metrics, the largest variance was on realized price, which fell 12% to $163 per ton. U.S. High-Vol indices averaged 25% less in Q2 compared to Q1. Currently, prices to date in Q3 are down more than 10% from the Q2 average. Overall production of 876,000 tons in Q2, was a quarterly record, up 5% compared with Q1, due to new mines ramping production. Total sales volume of 715,000 tons was down 6% compared with Q1, due again to the aforementioned transportation issues. Company-produced cash mine costs were 4% higher than in Q1. The increase in costs was largely due to continued inflationary pressures, as well as the inventory build on the back of rail issues. Specifically, cash cost per ton sold of $109, came in much higher than cash cost of production of $103 per ton. Looking ahead, we are adjusting our 2023 guidance, with an expectation that Q4 will be much stronger than Q3, with sales that will annualize to over 4 million tons in Q4. Naturally, that is expected to have a strong positive impact on both lower costs and stronger cash flow as we work down inventory. For Q3, sales are expected to be 700,000-900,000 tons. While we are not in the business of predicting pricing, if indices remain at current levels for the duration of Q3, we'd anticipate realized pricing to fall roughly 12%-15% from first half levels of $174 per ton. Our solid contracted book certainly insulates us from a portion of the decline in index pricing. We'd also anticipate Q3 cash costs to be similar to Q2 levels, and then declining in Q4 as sales volume increases. For full year 2023, production guidance is updated to 3 million-3.5 million tons, from 3.1 million-3.6 million tons, driven by the idling of our Triple S mine due to market conditions. This will drop production by roughly 100,000 tons. Given the limited mine life of Triple S, anticipated production beyond 2023 is relatively unaffected by this action. 2023 sales guidance is updated to 3.1 million-3.6 million tons, from 3.3 million-3.8 million tons, still representing an almost 40% increase versus 2022 sales. 2023 cash costs are now expected to be $102-$108 per ton, up from $97-$103 per ton, largely due to the combination of continued inflationary pressures and higher than anticipated costs during the ramp-up phase at our Berwind complex. Lastly, we now anticipate a lower 2023 CapEx of $60 million-$70 million, versus $65 million-$80 million previously. As Randy noted, a major highlight for us this past quarter was that our tracking stock, CORE Resources, ticker METCB, began trading in late June and has enjoyed a strong market reception. The board recently approved the payment of the initial CORE dividend in Q3, which is based on Q2 results. Clearly, we were disappointed with the fact that we weren't able to ship 85,000 tons due to transportation issues. If these had shipped as contracted, the tolling income that our CORE Resources dividend is based upon, would have been materially higher. While this concludes my financial remarks, I'm now going to give a brief sales and marketing update. Quite challenging market conditions in Q2, Jason and his team continued to do an excellent job placing tons into both new and existing customers. The majority of near-term demand continued to center around Asia, where net back pricing is typically lower than in our more traditional markets. As you probably know, the annual domestic contracting season is upon us, with most of the domestic steel mills out for tender for calendar 2024 contracts. Given that we are in the midst of these negotiations, we are not going to comment on any specifics here. In terms of the overall market, while demand remains relatively tepid, I would remind everyone that supply also remains quite subdued. Global coal CapEx remains just a fraction of what it has been historically. Given increased financing, permitting, and overall ESG challenges, barriers to entry into the coal space have never been higher. In addition, we have seen a number of high-cost operations around us, either close or cut their workforce materially, resulting in lower production. Interestingly, this is occurring when Australian pricing has generally remained between $200-$250 per metric ton over the past few months. We believe the cost curve has become meaningfully steeper in recent years on the back of strong global inflation. Indeed, a number of higher cost operations are currently underwater, even at today's prices. Amid this supply-demand backdrop, we will look to continue to execute on these sales as we grow production. With that said, I would now like to turn the call over to our Chief Operating Officer, Chris Blanchard. Thank you, Jeremy. As both Jeremy and Randy have noted, our two of our largest milestones in our multi-year growth progression largely ended in the second quarter and will be completed 100% this quarter. As we discussed on our last call, the idled Berwind mine restarted development mining last quarter. The first section has progressed according to our projections and sloped down into the Pocahontas No. 4 Seam in early July. Final slope work is ongoing and will be completed during August, and this mine will move out of development mode. At that time, the section will have reached the heart of the reserve area, and we will also be moving on to our fee coal position to further reduce our costs there. We have also begun the redeployment of manpower and equipment to start the second production Berwind section, which will also be ramped up during the third quarter. This section will start in the full Pocahontas No. 4 Seam and will not have any development mining, just the typical production ramp-up period. Supporting the Berwind mine, we also completed two exhaust ventilation shafts during the second quarter. We completed all of the fan upgrades, which we believe eliminates any future risks of lightning-related ignition, similar to the one-off accident which occurred last July. As the Berwind mine continues to ramp its production, we will look for opportunities to take advantage of its geologic and logistical advantages. This may involve further rationalizing higher cost production and moving manpower and equipment to the Berwind mine as additional mining areas become developed and available. Turning to Elk Creek, the upgrade to the preparation plant was largely complete in June. While we were finishing some of the last bullet items on the, on the upgrade, the full capacity feed rate has been reached and the plant balanced. It ran through its ramp-up and conditioning stages during June and early July. While the plant upgrade ended up being delayed by over two months due to equipment delivery delays, during the month of July, we managed to hit our full processing budget on a raw tons per day basis, as well as total raw tons for the month. Going forward, we expect that mine production and processing capabilities at Elk Creek will be more evenly matched, and that we will begin to work through the inventories of raw coal on the property and monetize them. Equally important from a cost perspective, the Elk Creek mines continue to produce well, and the upgraded plant throughput will eliminate downtime and missed shifts due to stockpile levels. It should also eliminate substantial trucking and rehandling costs associated with inventorying the raw coal, which we did during the first half of 2023. Lastly, the Maven surface and Highwall mine began production last quarter and is now fully staffed and fully ramped. We have seen favorable mining conditions thus far, and production has exceeded our original projections. The coal quality has also been as good as anticipated. With the three largest growth projects of 23 largely in our rearview mirror, we are pivoting to growing the production of our existing mines and optimizing and reducing our mine costs. We're working hand-in-hand with our rail and transportation partners to increase and streamline coal deliveries alongside the ramp-up at these complexes. We expect to be producing at approximately a 4 million to 4.5 million clean ton per year production rate as we enter 2024, and look to position ourselves as amongst the lowest cost, pure-play metallurgical producers. This now concludes management's prepared remarks, and now I'd like to return the call to the operator for the Q&A portion of the call. Operator? Thank you. The floor is now open for questions. At this time, if you have a question or comment, please press star one on your telephone keypad. If at any point your question is answered, you may remove yourself from the queue by pressing star two. Again, we ask that you pick up your handset when posing your questions to provide optimal sound quality. Thank you. Our first question comes from Lucas Pipes with B. Riley. Thank you very much, operator. Good morning, everyone. My first question is on pricing and the current market environment. Jeremy, if I heard you right, you mentioned that pricing would be down 12%-15% from first half levels, if current prices hold for kind of the remainder of the year. I guess I could back into it, but wasn't able to do it so quickly here on the call. What does this assume for net back prices on kind of unpriced tons for the remainder of the year? Thank you very much. Thanks, Lucas. First, just, just slight, correction is, so that, that would be the, the Q3, net back. I'd say there's, there's a couple things going on, going on there. You know, as, as we mentioned in our, prepared remarks, you know, demand right now certainly strongest in Asia compared to elsewhere. I'd say first and foremost, that assumes that that's, where a good chunk of the, the spot tons go. Secondly, you know, in terms of our, our contracted position, we've got a, a very nice contracted book. I'd say it's a little bit more weighted, both in terms of volume and certainly price, on, on the high side towards, Q4, versus, versus Q3. I'd say those are sort of the, the, the nuances in there. I would point out that obviously, you know, even a low double-digit% decline in realized price in Q3 is certainly better than what the index currently would point to if we were selling everything against the index. I'd, I'd also say that does point to certainly having a relatively strong contracted position. That's helpful. Jeremy, can you remind us kind of what the net back price would be on average in today's environment? Look, I mean, you know, if you're talking flat to the index, I mean, let's call it for a High-Vol A/B, you know, that's, that's about a $200 ton index. You know, if you're getting kind of flat to the index, that's, you know, $140-ish on new business. Again, you're gonna have to take some degree of the freight differential in, into Asia. Kind of depending upon where, where freight rates are, you know, you'd, you'd certainly put that on top of any. Or you back it out, I should say, from any index price. Got it. Thank you so much for that detail. My second question is about the rare earth opportunity, two questions there. The first is, in terms of the initial assessment and economic analysis, when would you expect that to be completed? Good to see that you, you hired contractors on that front. The $2.5 million that you are allocating towards the mine startup, what sort of I assume that's going towards equipment, but maybe that's wrong. If it is equipment, is that mobile equipment, plant, property, plant and equipment? You know, just, just a little bit of color on, on, on where the $2.5 million would go to, to get a little, little bit of a sense of the development cadence. Thank you so much. Sure. I think, you know, to answer your first part of your question, you know, the economics of this project are basically largely derived from the processing and separation techniques. As you know, Rare Earth is measured in parts per million, at least in the sense of coal. You know, we have to determine what exactly is gonna be the appropriate processing technique. That will happen, you know, on a sort of sequential basis as we basically analyze larger amounts of material. We'll get a pretty good sense of that, particularly as it relates to sort of the chemical qualities of some of the material, whether it's ionic or not, which has a large determination on the processing approaches. I would say within, you know, we give ourselves probably less than a six-month period to get some, some good initial results, but I would say I would expect probably more like a nine-month period before we would get really definitive results. As far as the mining is concerned, I'm gonna let Chris speak to that, but really, most of the spend is not on equipment per se, because we may start on some of that with contractors. Chris, go ahead. Right. Thank you, Randy. Luke, it's that $2.5 million will start being spent probably in early October and then run through into the first quarter of next year. It's, it's largely on development CapEx, putting in the sediment control, the roads to the permitted area for the initial pit. It will also include the excavation of a small area in the initial permitted areas for the testing and larger bulk samples that Randy has referenced. Okay. Okay, that's, that's really helpful. Hey, hey, I, I really appreciate all the color and detail. Best of luck, and, thanks, thanks very much. I'll turn it over. Thank you, Luke. Our next question comes from Nathan Martin with The Benchmark Company. Thanks, operator. Good morning, guys. Thanks for taking my questions. Maybe I'll start with, you guys mentioned you idled the Triple S mine due to market conditions there. We've seen some other nickel mine idling announced, which I think, Jeremy, you referred to in your prepared remarks. If U.S. indices kind of stay at these levels, as you pointed out, they've been kind of moving in the opposite direction from Asian indices, at least here to start the quarter. Do you think we could see more idlings? Again, assuming most of these are related to inflationary pressures we've seen on cost. Would also be great to get your thoughts on where you think the price of that marginal ton is today. Yeah, it's a great question, Nate. I mean, you know, clearly, you know, with the $200 High-Vol A/B average, you know, the fact that, you know, you're seeing, you know, idlings or layoffs and, and, and whatnot, tells you that the cost curve has moved materially higher. You know, I think the, the answer is we're already seeing, you know, certainly some mines, you know, either get idled or, or see their workforce reduced, and I think that'll continue. I mean, keep in mind, you know, a number of probably high-cost operations are being propped up by a strong 2023 contract book. That rolls off, you know, obviously, at the end of this year, and, you know, we'll see what 2024 pricing looks like. You know, again, I'd say, you know, in the absence of some of those, those, you know, stronger contracts, you'll certainly see some mines that have been around, you know, some time, probably idle. I'd also remind you that, you know, from our perspective, you know, every one of the mines that we have, you know, was not in place before 2017. Obviously, having a, a newer fleet of mines certainly is, is, puts us in a very, very good relative position, as Randy pointed out, on the overall cost curve. At least from our perspective, you know, I, I'd view Triple S as a, as a one-off. Actually, was put in place largely as a precursor to our Berwind operation. We, we actually did that after the Berwind mine went down, if I recall. That, essentially, we would be moving manpower and equipment from, from Triple S into the Berwind sections. Correct. Very helpful, guys. Appreciate that. Maybe related to your costs, specifically, compared to the $109 you guys reported, you know, where do you think cost per ton would have been in the second quarter, had you been able to ship those, you know, roughly 85,000 tons that slipped in July? Is that the $103 per ton cost of production I think you mentioned? You also said you expected 3Q costs to be roughly flat quarter-over-quarter. Should we be using that cost of sales of $109 as a base, or the cost of production of $103? Just, just to be clear there. Yeah, it's a good question, Nate. I mean, we shipped 715,000 tons, and obviously we produced, you know, about 150,000 tons more. I'd say, you know, had we shipped the 85,000 tons, you know, our cash cost of sales would have been pretty darn close to that $103 number. Maybe not exactly, but within $1 or $2 of that figure. And as it relates to Q3, I would use the $109, you know, cost of sales. You know, keep in mind, you've got a couple of things going on. Obviously, you've got the vacation week, you know, which increases costs. You know, as both Chris and Randy referenced, you know, Berwind is clearly, you know, the first section, you know, will be finished in development mode, you know, later on this, this month. The second section will begin to to to ramp. You know, really, you know, by the time you hit Q4, I mean, we, we expect Berwind, at least the, the, the two main sections to be to be running, you know, sort of on a, on a normal operating basis. By the end of the year, I would expect our costs to be sort of at or below, you know, $100 a ton. That's, that's probably the, the exit rate I would use into into next year, all else equal. Very helpful, Jeremy, appreciate that. Maybe just one more on the, on the tons that slipped. The 85,000 shipped, should I assume those were all export? Then maybe could you kind of share the domestic export split, you know, in the quarter, and then maybe what that looks like in 3Q, 4Q? Sure. Yeah, I mean, it was a combination of domestic and export, probably leaning a little bit more on the export side. You know, when I think about our, you know, our, our sort of domestic export split, you know, this quarter was probably our heaviest domestic quarter, call it about 50/50. Recall Q1 was, you know, in that kind of 1/3 domestic, 2/3 export range. You know, obviously there's still some spot sales to be had in the second half of the year, and certainly I would assume that, that, you know, majority of those go, go export. With that assumption, you know, domestic will probably be in that, call it, let's say, 40% range in the third quarter. Then, you know, as we exit the year above, 1 million tons shipped in the fourth quarter, you know, domestic will be down to, about a third of our shipments, with certainly, you know, the majority going, going export. Great. Thank you for that. Then, finally, maybe, you guys lowered your CapEx guidance for full year 2023 down to $60 million-$70 million. Looks like you've already spent $48 million in the first half, obviously that would imply a meaningful fall off in the second half. Just would be great to get your thoughts there on cadence of CapEx. From a high level, and I'll turn it to, to Chris. From a high level, Nate, obviously, you're, you're, you're correct. It implies, you know, $15 million-$20 million in, in the back half of, of, of the, of the year. Obviously, versus, you know, almost $50 million in the first half. You know, we've, we've spent really over the last 18 months, a lot of money getting the Elk plant from 2 million-3 million tons and the Berwind mine in development to where basically, you know, there's, there's two sections in the mine, and, you know, by the end of the third quarter, those two sections will be producing at a, at a sort of a normalized run rate. You know, I'd say we've, we've, we've always sort of had a much heavier cadence first half versus second half. Chris, you know, you want to expand a little bit on, on the updated guidance? Yeah. Most of it is, is just the completion of major projects, and then, sort of the delay or deferment of some other spending on mines like Triple S, that are higher cost profile. With the, the Berwind mine, the Berwind plant, and the Elk Creek plant projects behind us, and we have one project that's a little bit delayed due to permits at Elk Creek on our clean coal piles. That's, that's really what's driving the lower CapEx for the rest of this year. Appreciate that, Chris. I'll leave it there, guys. Thanks, thanks for the thoughts and the time, and best of luck in the second half. Thank you, Nate. Thank you. That does conclude the Q&A portion of today's call. I would now like to turn the call back over to Randall Atkins for closing remarks. I'd, again, like to thank everybody for joining us here today, and we'll look forward to catching up with everybody in the fall. Take care. Thank you. That does conclude today's teleconference. You may all now disconnect.