SunCoke Energy Inc. (NYSE:SXC) Q1 2018 Earnings Conference Call - Final Transcript

Apr 26, 2018 • 11:00 am ET


SunCoke Energy Inc. (NYSE:SXC) Q1 2018 Earnings Conference Call - Final Transcript


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My name is Matthew and I will be your conference operator today. At this time, I'd like to welcome everyone to the SunCoke Energy Q1 2018 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] Thank you.

Andy Kellogg, Treasurer and Director of Investor Relations, you may begin your conference.

Andy Kellogg

Good morning and thank you for joining us this morning to discuss SunCoke Energy's first quarter 2018 earnings. With me are Mike Rippey, our President and Chief Executive Officer and Fay West, our Senior Vice President and Chief Financial Officer.

Following management's prepared remarks, we will open the call for Q&A. This conference call is being webcast live on our Investor Relations section of our website, and a replay will be available there later today. If we don't get to your questions on the call, please feel free to reach out to our Investor Relations team.

Before I turn things over to Mike, let me remind you that the various remarks that we make on today's call regarding future expectations constitute forward-looking statements. The cautionary language regarding forward-looking statements in our SEC filings apply to the remarks we make today. These documents are available on our website as reconciliations to any non-GAAP financial measures discussed on today's call.

With that, I'll now turn things over to Mike.

Mike Rippey

Thanks, Andy and thank you all for joining the call this morning. We are off to a good start and making progress towards achieving our 2018 objectives. First quarter performance and financial results are a testament to the progress we're making. We continue to be pleased with the overall safety and operating performance of our coke and logistics assets and are encouraged to see the results from the sustained performance of our rebuilt ovens at the Indiana Harbor. 144 ovens rebuilt in 2016 and 2017 are demonstrating both solid charge weights and coking times, which have resulted in an increase in production and higher yields.

In March, we began work on the 2018 rebuild campaign and we anticipate our first group of ovens will be back in service in early May. As a reminder, we will rebuild 67 ovens as part of this year's campaign to fully rebuild our A-battery. While still early, we are on schedule and on budget and anticipate this year's rebuild program will be completed in November. After this year, we will have rebuilt greater than 75% of the facility. We're encouraged by the results that we're seeing from our rebuilt ovens, which are reflected in our first quarter results.

At Convent, we handled record volumes with over 2.5 million tons of throughput in the first quarter. Given CMT's unique capabilities and favorable coal export market dynamics, we anticipate netbacks to our customers will remain attractive and with a strong start to the year, we are increasing expectations on throughput tons to be between 10 million to 10.5 million tons in 2018.