UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38003

RAMACO RESOURCES, INC.

(Exact name of registrant as specified in its charter)


Delaware	38-4018838
(State or other jurisdiction	(I.R.S. Employer
of incorporation or organization)	Identification No.)

250 West Main Street, Suite 1800
Lexington, Kentucky	40507
(Address of principal executive offices)	(Zip code)

(859) 244-7455
(Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	METC	NASDAQ Global Select Market
9.00% Senior Notes due 2026	METCL	NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 12, 2022, the registrant had 44,273,388 shares of common stock outstanding.

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TABLE OF CONTENTS


		Page

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	24
Item 4.	Controls and Procedures	24

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	26
Item 1A.	Risk Factors	26
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 3.	Defaults Upon Senior Securities	27
Item 4.	Mine Safety Disclosures	27
Item 5.	Other Information	27
Item 6.	Exhibits	28

SIGNATURES		29

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this “Quarterly Report”) includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical fact included in this report, regarding our strategy, future operations, financial position, estimated revenue and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this Quarterly Report, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management’s current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements described under, but not limited to, the heading “Item 1A. Risk Factors” included in this Quarterly Report and elsewhere in the Annual Report of Ramaco Resources, Inc. (the “Company”) on Form 10-K for the year ended December 31, 2021 (the “Annual Report”) filed with the United States Securities and Exchange Commission (the “SEC”) on April 1, 2022 and other filings of the Company with the SEC.

Forward-looking statements may include statements about:

●

risks related to the impact of the novel coronavirus “COVID-19” global pandemic, such as the scope and duration of the outbreak, the health and safety of our employees, government actions and restrictive measures implemented in response, delays and cancellations of customer sales, supply chain disruptions and other impacts to the business, or our ability to execute our business continuity plans;

●

anticipated production levels, costs, sales volumes and revenue;

●

timing and ability to complete major capital projects;

●

economic conditions in the metallurgical coal and steel industries generally, including any near-term or long-term downturn in these industries as a result of the COVID-19 global pandemic and related actions;

●

expected costs to develop planned and future mining operations, including the costs to construct necessary processing, refuse disposal and transport facilities;

●

estimated quantities or quality of our metallurgical coal reserves;

●

our ability to obtain additional financing on favorable terms, if required, to complete the acquisition of additional metallurgical coal reserves as currently contemplated or to fund the operations and growth of our business;

●

maintenance, operating or other expenses or changes in the timing thereof;

●

the financial condition and liquidity of our customers;

●

competition in coal markets;

●

the price of metallurgical coal or thermal coal;

●

compliance with stringent domestic and foreign laws and regulations, including environmental, climate change and health and safety regulations, and permitting requirements, as well as changes in the regulatory environment, the adoption of new or revised laws, regulations and permitting requirements;

●

potential legal proceedings and regulatory inquiries against us;

●

the impact of weather and natural disasters on demand, production and transportation;

●

purchases by major customers and our ability to renew sales contracts;

●

credit and performance risks associated with customers, suppliers, contract miners, co-shippers and traders, banks and other financial counterparties;

●

geologic, equipment, permitting, site access and operational risks and new technologies related to mining;

●

transportation availability, performance and costs;

●

availability, timing of delivery and costs of key supplies, capital equipment or commodities such as diesel fuel, steel, explosives and tires;

●

timely review and approval of permits, permit renewals, extensions and amendments by regulatory authorities;

●

our ability to comply with certain debt covenants;

●

tax payments to be paid for the current fiscal year;

●

our expectations relating to dividend payments and our ability to make such payments;

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●

the anticipated benefits and impacts of the Ramaco Coal, LLC (“Ramaco Coal”) acquisition;

●

risks related to Russia’s recent invasion of Ukraine and the international community’s response;

●

risks related to weakened global economic conditions and inflation; and

●

other risks identified in this Quarterly Report that are not historical.

We caution you that these forward-looking statements are subject to a number of risks, uncertainties and assumptions, which are difficult to predict and many of which are beyond our control, incident to the development, production, gathering and sale of coal. Moreover, we operate in a very competitive and rapidly changing environment and additional risks may arise from time to time. It is not possible for our management to predict all of the risks associated with our business, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements we make in this Quarterly Report are reasonable, we can give no assurance that these plans, intentions or expectations will be achieved or occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

All forward-looking statements, expressed or implied, included in this Quarterly Report are expressly qualified in their entirety by this cautionary statement and speak only as of the date of this Quarterly Report. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue.

Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report.

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Ramaco Resources, Inc.

Unaudited Condensed Consolidated Balance Sheets


In thousands, except share and per share information	March 31, 2022		December 31, 2021

Assets
Current assets
Cash and cash equivalents	$	71,472	$	21,891
Accounts receivable		47,647		44,453
Inventories		19,543		15,791
Prepaid expenses and other		2,939		4,626
Total current assets		141,601		86,761
Property, plant and equipment, net		245,930		227,077
Financing lease right-of-use assets, net		12,296		9,128
Advanced coal royalties		4,645		5,576
Other		1,892		491
Total Assets	$	406,364	$	329,033

Liabilities and Stockholders' Equity
Liabilities
Current liabilities
Accounts payable	$	40,406	$	15,346
Accrued expenses		23,946		19,410
Asset retirement obligations		489		489
Current portion of long-term debt		7,133		7,674
Current portion of financing lease obligations		4,081		3,461
Other current liabilities		175		280
Total current liabilities		76,230		46,660
Asset retirement obligations		23,223		22,060
Long-term debt, net		2,698		3,339
Long-term financing lease obligations, net		5,968		4,599
Senior notes, net		32,478		32,363
Deferred tax liability, net		11,421		6,406
Other long-term liabilities		2,411		2,532
Total liabilities		154,429		117,959

Commitments and contingencies		—		—

Stockholders' Equity
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none issued and outstanding		—		—
Common stock, $0.01 par value, 260,000,000 shares authorized, 44,273,388 at March 31, 2022 and 44,092,981 at December 31, 2021 shares issued and outstanding		443		441
Additional paid-in capital		165,451		163,566
Retained earnings		86,041		47,067
Total stockholders' equity		251,935		211,074
Total Liabilities and Stockholders' Equity	$	406,364	$	329,033

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Ramaco Resources, Inc.

Unaudited Condensed Consolidated Statements of Operations


	Three months ended March 31,
In thousands, except per-share amounts	2022		2021

Revenue	$	154,882	$	43,455

Costs and expenses
Cost of sales (exclusive of items shown separately below)		81,253		31,198
Asset retirement obligations accretion		235		151
Depreciation and amortization		8,680		6,155
Selling, general and administrative		11,824		4,707
Total costs and expenses		101,992		42,211

Operating income		52,890		1,244

Other income		366		2,935
Interest expense, net		(1,130)		(202)

Income before tax		52,126		3,977
Income tax expense (benefit)		10,655		(166)
Net income	$	41,471	$	4,143

Earnings per common share
Basic	$	0.94	$	0.10
Diluted	$	0.92	$	0.10

Basic weighted average shares outstanding		44,181		43,443
Diluted weighted average shares outstanding		44,908		43,443

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Ramaco Resources, Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity


			Additional				Total
	Common		Paid-		Retained		Stockholders'
In thousands	Stock		in Capital		Earnings		Equity
Balance at January 1, 2022	$	441	$	163,566	$	47,067	$	211,074
Stock-based compensation		2		1,885		—		1,887
Dividends paid		—		—		(2,497)		(2,497)
Net income		—

SEC Form 10-Q filed by Ramaco Resources Inc.