v3.25.2
Description of Business, Basis of Presentation
 6 Months Ended
Jun. 30, 2025
Description of Business, Basis of Presentation [Abstract]  
Description of Business, Basis of Presentation
1.
 
Description of Business, Basis of Presentation
(a)
Description of the Business
 
Coronado
 
Global
 
Resources
 
Inc.
 
is
 
a
 
global
 
producer,
 
marketer,
 
and
 
exporter
 
of
 
a
 
full
 
range
 
of
 
metallurgical
coals,
 
an
 
essential
 
element
 
in
 
the
 
production
 
of
 
steel.
 
The
 
Company
 
has
 
a
 
portfolio
 
of
 
operating
 
mines
 
and
development projects in
 
Queensland, Australia, and
 
in the states of
 
Pennsylvania, Virginia and
 
West Virginia
 
in
the United States, or U.S.
 
(b)
 
Basis of Presentation
 
The interim unaudited condensed consolidated financial statements
 
have been prepared in accordance with the
requirements of U.S. generally accepted
 
accounting principles, or U.S. GAAP,
 
and with the instructions to Form
10-Q
 
and
 
Article
 
10
 
of Regulation
 
S-X
 
related
 
to
 
interim
 
financial
 
reporting
 
issued
 
by
 
the
 
U.S.
 
Securities
 
and
Exchange Commission, or the SEC.
 
Accordingly, they do not include all of
 
the information and footnotes required
by U.S. GAAP for complete financial statements and should be read
 
in conjunction with the audited consolidated
financial
 
statements
 
and
 
notes
 
thereto
 
included
 
in
 
the
 
Company’s
 
Annual
 
Report
 
on Form
 
10-K filed
 
with
 
the
SEC and the Australian Securities Exchange, or the ASX, on February
 
19,
 
2025.
The
 
interim
 
unaudited
 
condensed
 
consolidated
 
financial
 
statements
 
are
 
presented
 
in
 
U.S.
 
dollars,
 
unless
otherwise
 
stated.
 
They
 
include
 
the
 
accounts
 
of
 
Coronado
 
Global
 
Resources
 
Inc.
 
and
 
its
 
wholly-owned
subsidiaries.
 
References
 
to
 
“US$”
 
or
 
“USD”
 
are
 
references
 
to
 
U.S.
 
dollars.
 
References
 
to
 
“A$”
 
or
 
“AUD”
 
are
references
 
to
 
Australian
 
dollars,
 
the
 
lawful
 
currency
 
of
 
the
 
Commonwealth
 
of
 
Australia.
 
The
 
“Company”
 
and
“Coronado”
 
are
 
used
 
interchangeably
 
to
 
refer
 
to
 
Coronado
 
Global
 
Resources
 
Inc.
 
and
 
its
 
subsidiaries,
collectively, or to Coronado Global Resources Inc., as
 
appropriate to the context.
 
All intercompany balances and
transactions have been eliminated upon consolidation.
 
In
 
the
 
opinion
 
of
 
management,
 
these
 
interim
 
financial
 
statements
 
reflect
 
all
 
normal,
 
recurring
 
adjustments
necessary
 
for
 
the
 
fair
 
presentation
 
of
 
the
 
Company’s
 
financial
 
position,
 
results
 
of
 
operations,
 
comprehensive
income, cash flows and changes in
 
equity
 
for the periods presented. Balance sheet information
 
presented herein
as of December 31,
 
2024 has been derived from
 
the Company’s audited consolidated balance sheet at
 
that date.
The
 
Company’s
 
results
 
of
 
operations
 
for
 
the
 
three
 
and
 
six
 
months
 
ended
 
June
 
30,
 
2025
 
are
 
not
 
necessarily
indicative of the results that may be expected for the year
 
ending December 31, 2025.
Going Concern
The
 
Company’s
 
earnings
 
and
 
cash
 
flows
 
from
 
operating
 
activities
 
have
 
been
 
significantly
 
impacted
 
by
 
the
continued
 
subdued
 
performance
 
of
 
Met
 
coal
 
markets,
 
which
 
has
 
led
 
to
 
low
 
realized
 
prices
 
for
 
the
 
coal
 
the
Company sells.
 
For the three
 
and six months
 
ended June
 
30, 2025, the
 
Company incurred
 
net losses of
 
$
76.2
million and $
172.4
 
million, respectively.
During the three months ended June 30, 2025, the Company
 
completed certain initiatives to improve its liquidity
position and immediate cash flows given sustained low
 
Met coal prices.
 
On June 10, 2025, the Company entered into a Deed of Amendment with Stanwell
 
Corporation Ltd, or Stanwell,
for a prepayment for future coal sales of $
75.0
 
million and a Stanwell rebate waiver and deferral from April 2025
to December 2025 (with an estimated value of approximately $
75.0
 
million), both of which will be settled through
physical coal delivery over
five years
, or until such time that the obligation
 
is fully settled, starting in 2027.
 
Refer
to Note 11. Contract
 
Obligations for further information.
 
On
 
June
 
18,
 
2025,
 
the
 
Company
 
completed
 
refinancing
 
of
 
its
 
asset-based
 
lending
 
facility
 
for
 
an
 
aggregate
principal amount
 
up to $
150.0
 
million, or the
 
ABL Facility,
 
of which
 
$
75.0
 
million was drawn
 
on completion
 
and
the
 
remaining
 
$
75.0
 
million
 
is
 
available
 
to
 
the
 
Company
 
for
 
a
 
further
twelve months
,
 
limited
 
to
 
an
 
eligible
borrowing base. The
 
ABL Facility is subject
 
to financial covenants,
 
including maintenance of
 
leverage ratio and
interest
 
coverage
 
ratio,
 
tested
 
quarterly
 
and
 
commencing
 
on
 
September
 
30,
 
2025.
 
Refer
 
to
 
Note
 
9.
 
Interest
Bearing Liabilities for further information.
As
 
of
 
June
 
30,
 
2025,
 
which
 
included
 
the
 
effects
 
of
 
the
 
above
 
described
 
liquidity
 
initiatives,
 
the
 
Company’s
aggregate
 
sources
 
of
 
liquidity
 
were $
284.0
 
million,
 
which
 
comprised
 
of cash
 
and
 
cash
 
equivalents
 
(excluding
restricted cash) of $
261.6
 
million and $
22.4
 
million available for borrowing under the ABL Facility.
 
On
 
June
 
30,
 
2025,
 
S&P
 
downgraded
 
the
 
Company’s
 
credit
 
rating
 
from
 
‘B-‘
 
to
 
‘CCC+’
 
and,
 
on
 
July
 
7,
 
2025,
Moody’s downgraded the Company’s credit
 
rating from ‘Caa1’
 
to ‘Caa2’, both
 
of which resulted
 
in a Review
 
Event
under the ABL
 
Facility.
 
On July
 
9, 2025, the
 
Company successfully
 
negotiated with
 
the Lender,
 
who confirmed
no changes to the terms or the availability of the ABL Facility,
 
thereby, concluding
 
each of the Review Events.
 
Continued uncertainty in
 
Met coal markets
 
and further deterioration
 
of future Met
 
coal prices could
 
result in losses
and negative cash flows from operating activities for the remainder of 2025 and into 2026, which, combined
 
with
other factors,
 
could impact
 
the Company’s
 
ability to
 
comply with
 
financial covenants
 
under the
 
ABL Facility
 
on
and beyond September 30, 2025.
Non-compliance with financial covenants or a potential further downgrade to
 
the Company’s credit rating by S&P
or Moody’s may result
 
in an Event of Default under
 
the ABL Facility and, unless
 
the Event of Default is cured
 
or
a waiver is obtained,
 
could also trigger
 
a cross-default under the
 
indenture, dated as
 
of October 2, 2024,
 
or the
Indenture, governing the
9.250
% Senior Secured Notes due in 2029, or the Notes, issued by Coronado Finance
Pty Ltd,
 
an
 
Australian
 
proprietary
 
company
 
and
 
a
 
wholly-owned
 
subsidiary
 
of the
 
Company.
 
Refer
 
to
 
Note
 
9.
Interest Bearing Liabilities for further information.
 
The Company
 
continues to
 
pursue a
 
number of
 
initiatives including,
 
among other
 
things, further
 
operating and
capital cost control measures, partial asset
 
sales and potential other debt and
 
non-debt funding measures. While
these
 
plans
 
are
 
intended
 
to
 
address
 
the
 
events
 
and
 
conditions
 
described
 
above,
 
these
 
initiatives
 
have
 
not
progressed to a stage that provides confidence in their
 
successful execution or timely completion.
 
Accordingly,
 
management
 
has
 
concluded
 
that
 
substantial
 
doubt
 
exists
 
regarding
 
the
 
Company’s
 
ability
 
to
continue
 
as
 
a
 
going
 
concern
 
within
 
one
 
year
 
after
 
the
 
date
 
of
 
these
 
Condensed
 
Consolidated
 
Financial
Statements.
 
These
 
Condensed
 
Consolidated
 
Financial
 
Statements
 
have
 
been
 
prepared
 
on
 
a
 
going
 
concern
 
basis,
 
which
contemplates the realization
 
of assets and
 
discharge of liabilities
 
in the ordinary
 
course of business
 
and do not
include any
 
adjustments relating to
 
the recoverability and
 
classification of recorded
 
asset amounts or
 
the amounts
and classification
 
of liabilities
 
that might
 
result
 
from the
 
outcome
 
of the
 
uncertainties
 
described
 
above.
 
These
adjustments may be material.