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

Apr 26, 2018 • 11:00 am ET

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

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Q & A
Operator
Operator

(Operator Instructions) Our first question comes from the line of Lucas Pipes with B. Riley FBR. Your line is open.

Analyst
Lucas Pipes

Hi, good morning everybody. Good job at Indiana Harbor in particular and I wanted to ask to what extent the results thus far strengthen the case for full rebuilt of the entire facility? Thank you.

Executive
Fay West

good morning Lucas. How are you?GSo, we are -- we were very pleased with the performance in the quarter by Indiana Harbor and the results kind of speak to that. We have not yet made a decision on B battery, but we are encouraged by the way that the B battery ovens that have been rebuilt are operating. We do plan later this year to communicate what our plan is on rebuilding B battery, whether we do all or none or portion of the remaining 57 ovens. So stay tuned.

Analyst
Lucas Pipes

Sorry. Did you say when exactly you would make that determination or just later this year? Could you refine that?

Executive
Fay West

Yes. So I think I'll probably be in the back half of the year.

Analyst
Lucas Pipes

And what are some of the metrics that you're looking at in terms of making that decision,

in terms of the ovens that are currently operating, what sort of thresholds would they have to clear or what exactly is the decision predicated upon?Thank you.

Executive
Fay West

So obviously we're looking at kind of the performance of the oven, how we charge the oven, how the ovens coke out, what the production is, how they're maintaining kind of their structure. We're also evaluating the balance of the battery. As you know that B battery has been our most challenged battery in the past and what additional work would need to be -- what additional work is required to rebuild those ovens.

Analyst
Lucas Pipes

Okay. Thank you for that. And then maybe a bigger picture question. Over the last couple of years, it has been my observation that you've gained market share in the domestic coke industry. And you've consistently made the argument that some of the integrated ovens are in need of capital and at what point do you think there is the need for maybe additional coke making capacity in this country and when would you have those conversations with your customers? Thank you.

Executive
Fay West

So, as you know, there has been some incremental coke capacity that's come out over the last few years. The decision on kind of existing batteries that our customers operate, when and if those come out will be a decision that's made by our customers. And so of course that's something that we're monitoring as well as increased production or demands might exist over the next couple of years. Certainly, it's something that we're mindful of as we go into our 2020 renewal. But I think it really is just something that we're monitoring and evaluating when and if there's any incremental production that's required.

Analyst
Lucas Pipes

All right. I appreciate the color and best of luck.

Executive
Fay West

Thank you.

Operator
Operator

(Operator Instructions) Our next question