SunCoke Energy Inc. (NYSE:SXC) Q2 2017 Earnings Conference Call - Final Transcript
Jul 27, 2017 • 11:00 am ET
aggressively in line with our targets. But we've had good cost control of the plant. We've been able to make up the loss production and stay within our targets for EBITDA.
Okay, thank you.
[Operator Instructions] Your next question comes from the line of Lucas Pipes with FBR and Company. Your line is open.
Thank you, and good morning, everybody.
I also wanted to ask a few questions on the oven rebuilds. Could you just give us a reminder and you may have mentioned this earlier in terms of how many more ovens in total would have to be rebuilt? And do you still intend to -- do you intend to rebuild all of the ovens at Indiana Harbor? And at what time approximately would you say is that Indiana Harbor process completed? Thank you.
So there is 268 ovens at Indiana Harbor. When we complete the work this year, we'll have rebuilt the 144 of them. So it will be 54% of the plant. We haven't articulated our goals for next year. As Fay mentioned in her comments, we will do that at the conclusion of the third quarter when we can update investors on both the performance of the 2017 rebuilds, but also what our game plan is for 2018. But you can expect another substantive investment next year in oven rebuilds and Indiana Harbor.
With respect to profitability, we do anticipate from an adjusted EBITDA perspective that we would be profitable next year with both continued improved performance of oven rebuilds as well as the contract reset, which is effective 1/1/2018. And our goal is through the rebuild activity and continued aggressive cost control of the plant is to have a long-term sustainable level of profitability in cash flow from the plant respectively. Beyond that, I'm going to reserve my comments regarding our future plans till we get to the third quarter.
Got it, okay. That's helpful. Maybe a follow-up question on Granite City, there's been some talk in the industry regarding the US steel plant there. And I wondered kind of what's the current status, where is Granite City currently shipping and have you been contacted in regards to maybe going back to the original arrangement there regarding the Coke supply from that oven? And then thirdly, what would be the upside in terms of Granite City. I assume it's not running at full capacity right now? Thank you.
Well, first thing I would say is that our Granite City plant we obviously had the major outage in the second quarter, which was planned. But our Granite City plant has been shipping its Coke to another one of US Steel's blast furnaces in that last year, continues this year. The plant is expected to operate in accordance with its normal contract term.
US Steel was asked on their call about what might happen to the Granite City plant. You would have seen the comments about that. We would be encouraged if they