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Item 7. Management’s Discussion and Analysis

2026-02-19 compared with 2025-02-20 · 193 added, 254 removed, 448 unchanged (50% of the section changed)

7 unchanged sentences

Total Segment Costs is also used by management as a component of a metric to measure each segment’s operating performance.

Peabody Energy Corporation 2024 Form 10-K

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Also included in the following discussion of Peabody’s results of operations are references to Revenue per Ton, Costs per Ton and Adjusted EBITDA Margin per Ton for each reporting segment.

These metrics are used by management to measure each reporting segment’s operating performance.

Management believes Costs per Ton and Adjusted EBITDA Margin per Ton best reflect controllable costs and operating results at the reporting segment level.

Also included in the following discussion of Peabody’s results of operations are references to Revenue per Ton, Costs per Ton and Adjusted EBITDA Margin per Ton for each reportable segment.

These metrics are used by management to measure each reportable segment’s operating performance.

Management believes Costs per Ton and Adjusted EBITDA Margin per Ton best reflect controllable costs and operating results at the reportable segment level.

The Company considers all measures reported on a per ton basis to be operating/statistical measures;

however, the Company includes reconciliations of the related non-GAAP financial measures (Adjusted EBITDA and Total Segment Costs) in the “Reconciliation of Non-GAAP Financial Measures” section contained within this Item 7.

Peabody Energy Corporation 2025 Form 10-K

Peabody believes non-GAAP measures are used by investors to measure its operating performance.

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Refer to the “Reconciliation of Non-GAAP Financial Measures” section contained within this Item 7 for definitions and reconciliations to the most comparable measures under U.S.

In 2024, Peabody produced and sold 118.1 million and 118.0 million tons of coal, respectively, from continuing operations.

In 2025, Peabody sold 122.0 million tons of coal.

As of December 31, 2025, the Company reports its results of operations primarily through the following reportable segments:

Seaborne Thermal, Seaborne Metallurgical, Powder River Basin, Other U.S.

Thermal and Corporate and Other.

Seaborne Thermal, Seaborne Metallurgical, Powder River Basin and Other U.S.

The Company’s seaborne operating platform is primarily export focused with customers spread across several countries, with a portion of its thermal and metallurgical coal sold within Australia.

Generally, revenue from individual countries varies year by year based on electricity and steel demand, the strength of the global economy, governmental policies and several other factors, including those specific to each country.

The Company classifies its seaborne mines within the Seaborne Thermal or Seaborne Metallurgical segments based on the primary customer base and coal reserve type of each mining operation.

A small portion of the coal mined by the Seaborne Thermal segment is of a metallurgical grade.

Similarly, a small portion of the coal mined by the Seaborne Metallurgical segment is of a thermal grade.

The Company classifies its seaborne mines within the Seaborne Thermal or Seaborne Metallurgical reportable segments based on the primary customer base and coal reserve type of each mining operation.

A small portion of the coal mined by the Seaborne Thermal reportable segment is of a metallurgical grade.

Similarly, a small portion of the coal mined by the Seaborne Metallurgical reportable segment is of a thermal grade.

Additionally, the Company may market some of its metallurgical coal products as a thermal coal product from time to time depending on market conditions.

Peabody’s Seaborne Thermal and Seaborne Metallurgical segments contributed approximately 70% of the Company’s total Adjusted EBITDA from its mining operations during the year ended December 31, 2024.

Peabody’s Seaborne Thermal and Seaborne Metallurgical reportable segments contributed approximately 53% of the Company’s total Adjusted EBITDA from its mining operations during the year ended December 31, 2025.

The Company’s Seaborne Thermal operations consist of mines in New South Wales, Australia.

The mines in that segment utilize both surface and underground extraction processes to mine low-sulfur, high Btu thermal coal.

The mines in that reportable segment utilize surface extraction processes to mine low-sulfur, high Btu thermal coal.

Prior to September 2025, when the Wambo Underground Mine ceased production, the reportable segment also used underground extraction processes.

The Company’s Seaborne Metallurgical operations consist of mines in Queensland, Australia, one in New South Wales, Australia and one in Alabama, USA.

The mines in that segment utilize both surface and underground extraction processes to mine various qualities of metallurgical coal.

The mines in that reportable segment utilize both surface and underground extraction processes to mine various qualities of metallurgical coal.

The metallurgical coal qualities include hard coking coal, semi-hard coking coal, semi-soft coking coal and pulverized coal injection coal.

The Company’s thermal operating segments in the U.S.

The Company’s thermal operations in the U.S.

are focused on the mining, preparation and sale of thermal coal, sold primarily to electric utilities in the U.S.

1 unchanged sentence

The Company’s Powder River Basin operations consist of its mines in Wyoming.

The mines in that segment are characterized by surface mining extraction processes, coal with a lower sulfur content and Btu and higher customer transportation costs (due to longer shipping distances).

The mines in that reportable segment are characterized by surface mining extraction processes, coal with a lower sulfur content and Btu and higher customer transportation costs (due to longer shipping distances).

The Company’s Other U.S.

Thermal operations reflect the aggregation of its Illinois, Indiana, New Mexico and Colorado mining operations.

The mines in that segment are characterized by a mix of surface and underground mining extraction processes, coal with a higher sulfur content and Btu and lower customer transportation costs (due to shorter shipping distances).

The mines in that reportable segment are characterized by a mix of surface and underground mining extraction processes, coal with a higher sulfur content and Btu and lower customer transportation costs (due to shorter shipping distances).

Geologically, the Company’s Powder River Basin operations mine sub-bituminous coal deposits and its Other U.S.

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Peabody’s Powder River Basin and Other U.S.

Thermal segments contributed approximately 30% of the Company’s total Adjusted EBITDA from its mining operations during the year ended December 31, 2024.

The Company’s Corporate and Other segment includes selling and administrative expenses, results from equity method investments, trading and brokerage activities, minimum charges on certain transportation-related contracts, the closure of inactive mining sites, the impact of foreign currency remeasurement and certain commercial matters.

Peabody Energy Corporation 2024 Form 10-K

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Thermal reportable segments contributed approximately 47% of the Company’s total Adjusted EBITDA from its mining operations during the year ended December 31, 2025.

Corporate and Other includes selling and administrative expenses, results from equity method investments, trading and brokerage activities, minimum charges on certain transportation-related contracts, the closure of inactive mining sites, the impact of foreign currency remeasurement and certain commercial matters.

Resource Management.

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In addition, the Company generates revenue through royalties from coal reserves and oil and gas rights leased to third parties, farm income from surface lands under third-party contracts and lease income from surface lands under contracts with renewable energy ventures.

Peabody Energy Corporation 2025 Form 10-K

Middlemount Mine.

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During the years ended December 31, 2025 and 2024, the mine sold 1.5 million and 1.3 million tons of coal, respectively (on a 50% basis).

Spot pricing for premium low-vol hard coking coal (Premium HCC), premium low-vol pulverized coal injection (Premium PCI) coal, Newcastle index thermal coal and API 5 index thermal coal, and prompt month pricing for PRB 8,800 Btu/Lb coal and Illinois Basin 11,500 Btu/Lb coal during the year ended December 31, 2024 is set forth in the table below.

The seaborne pricing included in the table below is not necessarily indicative of the pricing the Company realized during the year ended December 31, 2024 due to quality differentials and a portion of its seaborne sales being executed through annual and multi-year international coal supply agreements that contain provisions requiring both parties to renegotiate pricing periodically, with spot, index and quarterly sales arrangements also utilized.

The Company’s typical practice is to negotiate pricing for seaborne metallurgical coal contracts on a quarterly, spot or index basis and seaborne thermal coal contracts on an annual, spot or index basis.

In the U.S., the pricing included in the table below is also not necessarily indicative of the pricing the Company realized during the year ended December 31, 2024 since the Company generally sells coal under long-term contracts where pricing is determined based on various factors.

Such long-term contracts in the U.S.

may vary significantly in many respects, including price adjustment features, price reopener terms, coal quality requirements, quantity parameters, permitted sources of supply, treatment of environmental constraints, extension options, force majeure and termination and assignment provisions.

Competition from alternative fuels such as natural gas and other fuel sources may also impact the Company’s realized pricing.

Pricing during the year ended December 31, 2025 is set forth in the table below.

High Low Average December 31, 2025 February 13, 2026

Premium HCC (1)

Premium low-vol hard coking coal (Premium HCC) (1)

$ 218.00 $ 166.00 $ 188.28 $ 218.00 $ 242.50

Premium PCI coal (1)

Premium low-vol pulverized coal injection (Premium PCI) coal (1)

153.00 126.50 140.57 146.50 167.40

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51.25 43.25 47.41 51.25 53.75

(1) Prices expressed per metric tonne.

(2) Prices expressed per short ton.

Within the global coal industry, supply and demand for its products and the supplies used for mining continue to be impacted by the ongoing Russian-Ukrainian conflict.

As future developments related to the Russian-Ukrainian conflict and geopolitical instability in key energy producing regions are unknown, the global coal industry data for the twelve months ended December 31, 2024 presented herein may not be indicative of their ultimate impacts.

(1) Spot pricing expressed per metric tonne.

(2) Prompt month pricing expressed per short ton.

The seaborne pricing included in the table above is not necessarily indicative of the pricing the Company realized during the year ended December 31, 2025 due to quality differentials and a portion of its seaborne sales being executed through annual and multi-year international coal supply agreements that contain provisions requiring both parties to renegotiate pricing periodically, with spot, index and quarterly sales arrangements also utilized.

In the U.S., the pricing included in the table above is also not necessarily indicative of the pricing the Company realized during the year ended December 31, 2025 since the Company generally sells coal under long-term contracts where pricing is determined based on various factors.

Such long-term contracts in the U.S.

Competition from alternative fuels such as natural gas and other fuel sources may also impact the Company’s realized pricing.

Within the global coal industry, supply and demand for its products and the supplies used for mining are being impacted by recent changes to trade policy, including tariffs and customs regulations.

As future developments related to trade policy, including additional or retaliatory tariffs, delays in implementing previously announced changes or ongoing negotiations between countries, are unknown, the global coal industry data for the year ended December 31, 2025 presented herein may not be indicative of their ultimate impacts.

Within the seaborne metallurgical coal market, metallurgical coal prices were mixed during the year ended December 31, 2025.

Globally, both steel production and pig iron production (which predominantly utilizes metallurgical coal) declined during the period.

In China, lower domestic steel consumption constrained output, while producers in most other countries experienced competitive pressure from increased Chinese steel exports.

India was an exception, expanding its steel making capabilities and increasing pig iron output versus the prior year.

Metallurgical coal prices were influenced by lower global steel output in 2025, with premium hard coking coal prices averaging lower in 2025 than 2024.

However, metallurgical coal supply curtailment events, such as wet weather disruptions in Australia and changing rates of Chinese coal production, at times contributed to seaborne metallurgical coal price support.

In addition, geopolitical trends and trade policies, including tariff regimes, continue to influence global metallurgical trade flows.

Looking forward, the seaborne metallurgical coal price may remain volatile based on China’s coal production policies, the pace of growth of the Indian steel industry, changing global trade policies and global supply curtailment actions.

Peabody Energy Corporation 2025 Form 10-K

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Within the seaborne metallurgical coal market, coking coal prices retreated from a high base during the twelve months ended December 31, 2024.

Parts of the global steel market reported tepid demand and thin profit margins during this period, restricting demand growth for metallurgical coal.

In China, weakness in the property sector contributed to lower domestic steel demand and steel production in 2024 and supported increased steel exports.

The increased availability of competitively priced Chinese imports has placed pressure on steel margins for steel producers in other countries.

Despite this, India recorded year-over-year steel production growth supported by increased domestic demand and commissioning of new steelmaking facilities.

Meanwhile, the global supply of coking coal has been generally sufficient to meet coking coal demand during the twelve months ended December 31, 2024, despite various supply disruption events such as shipping interruptions at the U.S.’s Baltimore, Maryland port.

In the PCI segment, prices traded at a wide discount to coking coal early in the year, caused in part by reduced steel making productivity targets under thin margin conditions.

PCI price relativities to coking coal have since improved.

Overall, the market for metallurgical coal remains marginally balanced and exposed to volatility, influenced by the rate of exports from Australia and economic performance in China, India and elsewhere.

Within the seaborne thermal coal market, global thermal coal prices have remained relatively stable throughout the twelve months ended December 31, 2024, driven by healthy supply meeting elevated demand in Asian markets.

In China, overall total generation demand has been elevated while domestic coal production has only grown slightly, which has driven stronger coal import demand year-over-year through the twelve months ended December 31, 2024.

In India, strong growth in coal generation has supported increased import demand, despite elevated domestic coal production.

Looking ahead, global thermal coal markets remain turbulent amid winter weather outlooks in the Northern Hemisphere, lower industrial activity, as well as volatile global natural gas markets.

In the U.S., overall electricity demand increased approximately 3% year-over-year.

Through the twelve months ended December 31, 2024, electricity generation from thermal coal has decreased year-over-year driven by continued low natural gas prices and stronger renewable generation.

Coal’s share of electricity generation has declined to approximately 15% for the twelve months ended December 31, 2024, while wind and solar’s combined generation share is at 17% and the share of natural gas generation has remained level at 43%.

coal inventories have modestly declined through December 31, 2024, with stockpiles less than 10 million tons below levels seen at the end of 2023.

During the twelve months ended December 31, 2024, utility consumption of PRB coal has declined compared to the prior year period.

Planned Acquisition

On November 25, 2024, Peabody entered into definitive agreements with Anglo, to acquire a portion of the assets and businesses associated with Anglo’s metallurgical coal portfolio in Australia, including the Moranbah North and Grosvenor mines, the Moranbah South development project, the Capcoal complex, the Roper Creek mine and the Dawson complex (comprising the Dawson Main/Central, Dawson South, Dawson South Exploration and Theodore South exploration mines, collectively, the Dawson Assets).

Following the prospective closing of the Anglo acquisition, the Company is contracted to sell the Dawson Assets to BUMA.

Peabody has secured a bridge facility commitment to finance the acquisition.

The Company intends to replace the bridge facility with permanent financing, including debt capacity, additional investment by existing joint venture partners and other financing to supplement as warranted.

The acquisition is expected to close in the second quarter of 2025, subject to regulatory approvals, completion of preemptive rights processes and satisfaction of other customary closing conditions.

“Long-term Debt” and Note 17.

“Other Events” for further information.

Within the seaborne thermal coal market, global thermal coal prices were mixed during the year ended December 31, 2025.

In China, power generation increased year-over-year through December 31, 2025, however the share of renewables in the generation mix continued to grow, pressuring coal generation.

In addition, domestic coal production increased slightly year-over-year, which led to weaker coal import demand through the year ended December 31, 2025.

In India, steady domestic coal production, lower import demand and declining coal generation led to stable coal stockpiles.

Looking forward, seaborne thermal coal prices may remain volatile based on the outcomes of China’s supply reforms, winter re-stocking activity in the Northern Hemisphere and volatility in global natural gas markets which can impact global thermal coal markets.

In the U.S., overall electricity demand increased over 2% year-over-year.

Through the year ended December 31, 2025, electricity generation from thermal coal increased year-over-year, driven by higher natural gas prices and stronger total generation.

Coal’s share of electricity generation increased to approximately 16% for the year ended December 31, 2025, while wind and solar’s combined generation share was at 19% and the share of natural gas generation declined to approximately 40%.

coal inventories have declined through December 31, 2025, driven by stronger coal utilization, resulting in stockpiles declining 20 million tons below levels seen at the end of 2024.

Centurion Mine

Peabody’s development of the Centurion Mine, an underground longwall metallurgical coal mine in Queensland, Australia, continues to advance as planned.

During the year ended December 31, 2024, four continuous miners units were put into production and the first development coal was produced, washed and sold.

The Company is targeting the commencement of longwall production in the first quarter of 2026.

Approximately $300 million of the $489 million of capital expenditures to reach longwall production had been completed as of December 31, 2024.

Wards Well Acquisition .

On April 16, 2024 the Company acquired the southern part of the Wards Well tenements (Wards Well) which are adjacent to the Company’s Centurion Mine in Queensland, Australia.

The acquisition was completed for total consideration of $153.4 million, consisting of cash consideration of $134.4 million, cash transaction costs of $9.4 million and the non-cash settlement of existing receivables with the acquiree of $9.6 million.

Peabody Energy Corporation 2024 Form 10-K

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The agreement also includes an initial contingent royalty of up to $200 million.

The royalty will only be payable once the Company has recovered its investment and development costs of Wards Well and if the average sales price achieved exceeds certain thresholds.

No royalty is payable if the Company does not commence mining Wards Well.

Shoal Creek Insurance Recovery .

On March 29, 2023, the Company’s Shoal Creek Mine experienced a fire.

In October 2023, the Company filed an insurance claim against applicable insurance policies with combined business interruption and property loss limits of $125 million above a $50 million deductible.

During June 2024, the Company reached a settlement and recognized a $109.5 million insurance recovery, which the Company included in its results of operations during the year ended December 31, 2024.

During 2025, Peabody continued to advance the development of the Centurion Mine, an underground longwall metallurgical coal mine in Queensland, Australia.

Full-scale longwall production commenced in February 2026.

The mine is expected to enhance both the quantity and quality of the Company’s production from the Seaborne Metallurgical reportable segment.

Arbitration Relating to Terminated Anglo Acquisition

On November 25, 2024, Peabody entered into Purchase Agreements with Anglo, to acquire a portion of the assets and businesses associated with Anglo’s metallurgical coal portfolio in Australia, including Anglo’s interests in the Moranbah North and Grosvenor mines, the Moranbah South development project, the Capcoal complex, the Roper Creek mine and the Dawson complex (comprising the Dawson Main/Central operating mine, the Dawson South operating mine, the Dawson South Exploration project and the Theodore South exploration project, collectively, the Dawson Assets).

The Company agreed to, following the prospective closing of the Anglo acquisition, sell the Dawson Assets to Pt Bukit Makmur Mandiri Utama or one of its subsidiaries (BUMA).

On August 19, 2025, Peabody terminated the Purchase Agreements.

The termination of the Purchase Agreements followed Peabody’s prior delivery of a notice of a MAC as a result of an ignition event at the Moranbah North mine on March 31, 2025, which had led to the closure of the mine.

“Summary of Significant Accounting Policies” and Note 20.

“Commitments and Contingencies” to the accompanying consolidated financial statements for further information.

On September 23, 2025, various subsidiaries of Anglo initiated International Chamber of Commerce arbitration proceedings in London, United Kingdom, against Peabody and certain of its affiliates.

Anglo’s complaint alleges, among other things, that Peabody wrongfully terminated the Purchase Agreements and seeks, among other things, declarations that the ignition event at the Moranbah North mine did not constitute a MAC, as well as damages for losses in an unspecified amount, plus costs and interest.

Peabody remains confident that a MAC occurred, and that it was entitled to terminate the Purchase Agreements.

Potential Recovery of Rare Earth Elements

Peabody has been evaluating the potential recovery of REEs and CMs, with substantial testing at its Powder River Basin operations.

The Company is progressing its REE/CM initiative by conducting testing to evaluate mineral types and concentrations;

developing flowsheets in conjunction with technology partners to support technical and economic assessments and produce rare earth products;

and collaborating with governmental agencies and departments at the state and federal level.

In February 2026, the Wyoming Energy Authority awarded Peabody funding of $6.25 million for a pilot plant using Peabody’s Powder River Basin coal for REE/CM processing.

Results of Operations

Year Ended December 31, 2025 Compared to Year Ended December 31, 2024

The decrease in income from continuing operations, net of income taxes for the year ended December 31, 2024 compared to the prior year ($408.7 million) was primarily driven by lower revenue ($710.0 million) due to lower seaborne coal pricing, volume decreases in the U.S.

thermal segments and no unrealized mark-to-market gains from derivative contracts related to forecasted sales in the current year.

This unfavorable variance was partially offset by a lower income tax provision ($200.0 million) and the current year insurance recovery at the Shoal Creek Mine ($109.5 million).

The decrease in results from continuing operations, net of income taxes for the year ended December 31, 2025 compared to the prior year ($449.6 million) was primarily driven by lower revenue ($375.2 million) due to lower seaborne coal pricing, the prior year insurance recovery at the Shoal Creek Mine ($109.5 million) and increased costs related to the terminated Anglo acquisition ($68.6 million).

These unfavorable variances were partially offset by a lower income tax provision ($100.0 million) and lower operating costs and expenses ($86.0 million).

Peabody Energy Corporation 2025 Form 10-K

Adjusted EBITDA for the year ended December 31, 2025 reflected a year-over-year decrease of $416.8 million.

The following table presents tons sold by operating segment:

Increase (Decrease)

The following table presents tons sold:

(Decrease) Increase

Year Ended December 31, to Volumes

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Thermal 13.4 14.6 (1.2) (8.2) %

Total tons sold from operating segments 117.9 125.8 (7.9) (6.3) %

Total tons sold from reportable segments 121.9 117.9 4.0 3.4 %

Corporate and Other 0.1 0.1 — — %

Total tons sold 122.0 118.0 4.0 3.4 %

Peabody Energy Corporation 2024 Form 10-K

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Supplemental Financial Data

The following table presents supplemental financial data by operating segment:

The following table presents supplemental financial data by reportable segment:

Year Ended December 31, (Decrease) Increase

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and certain other costs related to post-mining activities.

The following table presents revenue by reporting segment:

Peabody Energy Corporation 2025 Form 10-K

The following table presents revenue by reportable segment:

(Decrease) Increase

Year Ended December 31, to Revenue

8 unchanged sentences

Seaborne Thermal.

The decrease in segment revenue during the year ended December 31, 2024 compared to the prior year was due to unfavorable realized prices ($228.0 million), offset by favorable volume ($112.2 million).

The decrease in segment revenue during the year ended December 31, 2025 compared to the prior year was due to unfavorable realized prices ($245.0 million) and unfavorable volume ($60.4 million) due in part to reductions at the Wilpinjong Mine.

Seaborne Metallurgical.

Segment revenue decreased during the year ended December 31, 2024 compared to the prior year due to unfavorable realized prices and volume ($356.3 million) from the Australian operations.

These decreases were partially offset by favorable results from the Shoal Creek Mine ($110.0 million) due to favorable volume which offset unfavorable realized prices.

Segment revenue decreased during the year ended December 31, 2025 compared to the prior year due to unfavorable realized prices ($219.2 million), offset by favorable volume ($200.2 million) from the Shoal Creek and Centurion Mines.

Powder River Basin.

Segment revenue decreased during the year ended December 31, 2024 compared to the prior year primarily due to unfavorable volume ($100.2 million) resulting from decreased demand driven by low natural gas pricing and mild weather.

Peabody Energy Corporation 2024 Form 10-K

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The decrease in segment revenue during the year ended December 31, 2024 compared to the prior year was due to unfavorable volume ($49.8 million) resulting from decreased demand driven by low natural gas pricing and mild weather and unfavorable realized prices ($34.9 million), partially offset by increased revenue from sales contract cancellation settlements ($19.1 million).

Segment revenue increased during the year ended December 31, 2025 compared to the prior year due to favorable volume ($72.7 million) resulting from increased demand, offset by unfavorable realized prices ($18.5 million) which were driven by the impact of adjustments to cost pass-through contracts with certain customers resulting from the federal royalty rate reduction included in the OBBBA.

The decrease in segment revenue during the year ended December 31, 2025 compared to the prior year was due to unfavorable volume ($43.2 million) resulting from decreased demand, dragline outages at the Bear Run Mine and challenging geological conditions at the Twentymile Mine;

decreased revenue from sales contract cancellation settlements ($37.7 million);

and unfavorable realized prices ($34.4 million).

Corporate and Other.

Segment revenue decreased during the year ended December 31, 2024 compared to the prior year due to no unrealized mark-to-market gains from derivative contracts related to forecasted sales in the current year ($159.0 million) as all derivative contracts settled in 2023 and prior year revenue related to the Company’s assignment of rights to its excess port and rail capacity ($25.9 million).

Segment revenue increased during the year ended December 31, 2025 compared to the prior year due to higher results from trading activities ($7.6 million).

Segment Costs

The following table presents costs by reporting segment:

Increase (Decrease)

The following table presents costs by reportable segment:

(Decrease) Increase

Year Ended December 31, to Total

12 unchanged sentences

Seaborne Thermal.

The increase in segment costs during the year ended December 31, 2024 compared to the prior year was primarily driven by favorable volume (0.9 million tons) which resulted in higher sales related costs ($16.9 million) and higher variable costs for labor, repairs and outside services ($12.8 million), slightly offset by favorable commodity pricing ($8.4 million).

The decrease in Segment Costs during the year ended December 31, 2025 compared to the prior year was due to lower costs for labor, repairs and outside services ($73.9 million) resulting from timing of maintenance and operational improvements, lower sales related costs ($28.0 million) driven by both lower realized prices and volume, lower leasing expense ($9.0 million) and favorable commodity pricing ($8.0 million);

offset by higher recognized costs resulting from sales volume outpacing production volume ($26.0 million).

Peabody Energy Corporation 2025 Form 10-K

Seaborne Metallurgical.

Segment costs increased during the year ended December 31, 2024 compared to the prior year due to increased volume from the Shoal Creek Mine ($56.1 million), higher costs at the Australian operations primarily due to production challenges ($21.3 million) and increased taxes and insurance ($11.0 million) driven by Australian carbon taxes.

The increases were offset by lower sales related costs ($66.2 million) at the Australian operations due to lower sales volumes and lower pricing.

Segment Costs increased during the year ended December 31, 2025 compared to the prior year due to higher variable operational and sales related costs driven by increased volume (1.3 million tons).

Powder River Basin.

The decrease in segment costs during the year ended December 31, 2024 compared to the prior year was primarily driven by unfavorable volume (7.6 million tons) which resulted in lower sales price sensitive costs ($44.4 million) and lower variable costs for labor, repairs and outside services ($32.3 million) and favorable commodity pricing ($21.7 million).

These decreases were partially offset by increased lease spend ($14.3 million).

The decrease in segment costs during the year ended December 31, 2024 compared to the prior year was primarily driven by lower costs for labor, repairs and outside services due to lower sales volume (1.6 million tons).

The increase in Segment Costs during the year ended December 31, 2025 compared to the prior year was primarily due to higher costs for labor, repairs and outside services ($26.7 million) due in part to unplanned dragline outages, haul truck repairs and increased volume (4.9 million tons), offset by lower sales related costs ($16.4 million) which were largely driven by the federal royalty rate reduction on coal production included in the OBBBA.

The decrease in Segment Costs during the year ended December 31, 2025 compared to the prior year was driven by lower volume (1.2 million tons) and lower costs for labor ($13.3 million).

Corporate and Other.

Segment costs increased during the year ended December 31, 2024 compared to the prior year primarily due to unfavorable foreign currency rate changes.

Peabody Energy Corporation 2024 Form 10-K

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Segment costs decreased during the year ended December 31, 2025 compared to the prior year primarily due to favorable remeasurement of foreign currency denominated monetary assets, substantially comprised of Australian dollar denominated restricted cash and cash collateral, offset by higher expense from trading activities and lower amortization of prior service credit.

Adjusted EBITDA

The following table presents Adjusted EBITDA for each of the Company’s reporting segments:

The following table presents Adjusted EBITDA for each of the Company’s reportable segments:

(Decrease) Increase to

Year Ended December 31, Adjusted EBITDA

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Seaborne Thermal.

Segment Adjusted EBITDA decreased during the year ended December 31, 2024 compared to the same period in the prior year as a result of lower realized prices net of sales price sensitive costs ($225.2 million), partially offset by favorable volume and mix variances ($58.0 million).

Segment Adjusted EBITDA decreased during the year ended December 31, 2025 compared to the same period in the prior year as a result of lower realized prices net of sales price sensitive costs ($227.7 million) and unfavorable volume ($59.5 million), offset by favorable operational costs as described above.

Seaborne Metallurgical.

Segment Adjusted EBITDA decreased during the year ended December 31, 2024 compared to the same period in the prior year due to lower realized prices net of sales price sensitive costs ($294.5 million) and unfavorable operational costs ($106.3 million).

These decreases were offset by favorable volume ($112.0 million), despite the lock outages during 2024, driven by increased production from the Shoal Creek Mine following the fire in the first quarter of 2023, and the Shoal Creek insurance recovery ($80.8 million).

Segment Adjusted EBITDA decreased during the year ended December 31, 2025 compared to the same period in the prior year due to lower realized prices net of sales price sensitive costs ($168.8 million) and the prior year Shoal Creek insurance recovery ($80.8 million), offset by favorable volume.

Powder River Basin.

Segment Adjusted EBITDA decreased during the year ended December 31, 2024 compared to the same period in the prior year as a result of unfavorable volume ($50.3 million) and increased lease spend ($14.3 million).

These decreases were offset by lower costs for labor, repairs and outside services ($32.3 million) and favorable commodity pricing ($21.7 million).

Segment Adjusted EBITDA decreased during the year ended December 31, 2024 compared to the same period in the prior year due to unfavorable volume ($63.1 million) and lower realized prices net of sales price sensitive costs ($34.5 million).

These decreases were offset by increased sales contract cancellation settlements ($19.1 million) and lower costs for labor, repairs and outside services ($12.0 million).

Segment Adjusted EBITDA increased during the year ended December 31, 2025 compared to the same period in the prior year as a result of favorable volume ($38.9 million);

lower sales related costs ($16.4 million) as described above;

and decreased overburden removal costs ($6.4 million).

The increases were offset by higher costs for labor, repairs and outside services as described above.

Segment Adjusted EBITDA decreased during the year ended December 31, 2025 compared to the same period in the prior year due to decreased sales contract cancellation settlements ($37.7 million) and lower realized prices net of sales price sensitive costs ($29.8 million).

Peabody Energy Corporation 2025 Form 10-K

Corporate and Other Adjusted EBITDA.

The following table presents a summary of the components of Corporate and Other Adjusted EBITDA:

(Decrease) Increase

Year Ended December 31, to Income

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(2) Includes gains (losses) on certain surplus coal reserve, coal resource and surface land sales and property management costs and revenue.

(3) Includes trading and brokerage activities, costs associated with post-mining activities, gains (losses) on certain asset disposals, minimum charges on certain transportation-related contracts, results from the Company’s equity method investment in renewable energy joint ventures, costs associated with suspended operations including the Centurion Mine, the impact of foreign currency remeasurement and expenses related to the Company’s other commercial activities.

Peabody Energy Corporation 2024 Form 10-K

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Corporate and Other Adjusted EBITDA decreased during the year ended December 31, 2024 compared to the same period in the prior year due to the unfavorable net impact of foreign currency rate changes ($28.4 million), prior year revenue related to the Company’s assignment of rights to its excess port and rail capacity ($25.9 million) and unfavorable trading results ($19.0 million).

Income From Continuing Operations, Net of Income Taxes

The following table presents income from continuing operations, net of income taxes:

(3) Includes trading and brokerage activities, costs associated with post-mining activities, gains (losses) on certain asset disposals, minimum charges on certain transportation-related contracts, results from the Company’s equity method investment in renewable energy joint ventures, costs associated with suspended operations, holding costs associated with the Centurion Mine, the impact of foreign currency remeasurement and expenses related to the Company’s other commercial activities.

Corporate and Other Adjusted EBITDA increased during the year ended December 31, 2025 compared to the same period in the prior year.

Unfavorable variances in Middlemount’s results driven by lower sales pricing and higher selling and administrative expenses were partially offset by higher gains on equipment and land sales ($17.9 million).

The increase in other items was driven by the favorable remeasurement of foreign currency denominated monetary assets, substantially comprised of Australian dollar denominated restricted cash and cash collateral ($62.7 million), offset by the lower amortization of prior service credit ($10.9 million) and unfavorable trading results ($6.5 million).

(Loss) Income From Continuing Operations, Net of Income Taxes

The following table presents (loss) income from continuing operations, net of income taxes:

(Decrease) Increase to Income

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Restructuring charges (9.5) (4.4) (5.1) (115.9) %

Transaction costs related to business combinations (10.3) — (10.3) n.m.

Asset impairment — (2.0) 2.0 100.0 %

Provision for NARM and Shoal Creek losses (3.7) (40.9) 37.2 91.0 %

Shoal Creek insurance recovery - property damage 28.7 — 28.7 n.m.

Costs related to terminated acquisition (78.9) (10.3) (68.6) (666.0) %

Shoal Creek insurance recovery - property damage — 28.7 (28.7) (100.0) %

Changes in amortization of basis difference related to equity affiliates 2.7 1.8 0.9 50.0 %

Other operating loss (5.6) (3.7) (1.9) (51.4) %

Interest expense, net of capitalized interest (43.9) (46.9) 3.0 6.4 %

Net loss on early debt extinguishment — (8.8) 8.8 100.0 %

Interest income 55.4 71.0 (15.6) (22.0) %

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5.4 6.1 (0.7) (11.5) %

Unrealized gains on derivative contracts related to forecasted sales — 159.0 (159.0) (100.0) %

Unrealized (losses) gains on foreign currency option contracts (9.0) 7.4 (16.4) (221.6) %

Unrealized gains (losses) on foreign currency option contracts 6.0 (9.0) 15.0 166.7 %

Take-or-pay contract-based intangible recognition 1.0 3.0 (2.0) (66.7) %

Income tax provision (8.8) (108.8) 100.0 91.9 %

Income from continuing operations, net of income taxes $ 407.3 $ 816.0 $ (408.7) (50.1) %

(Loss) income from continuing operations, net of income taxes $ (42.3) $ 407.3 $ (449.6) (110.4) %

(1) This is a financial measure not recognized in accordance with U.S.

Refer to the “Reconciliation of Non-GAAP Financial Measures” section below for definitions and reconciliations to the most comparable measures under U.S.

Peabody Energy Corporation 2025 Form 10-K

Depreciation, Depletion and Amortization.

The following table presents a summary of depreciation, depletion and amortization expense by reporting segment:

(Decrease) Increase

The following table presents a summary of depreciation, depletion and amortization expense by reportable segment:

Year Ended December 31, to Income

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(10.2) (7.8) (2.4) (30.8) %

Total $ (343.0) $ (321.4) $ (21.6) (6.7) %

Peabody Energy Corporation 2024 Form 10-K

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Additionally, the following table presents a summary of the Company’s weighted-average depletion rate per ton for active mines in each of its operating segments:

Total depreciation, depletion and amortization $ (384.5) $ (343.0) $ (41.5) (12.1) %

Additionally, the following table presents a summary of the Company’s weighted-average depletion rate per ton for active mines in each of its reportable segments:

Year Ended December 31,

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Thermal 1.72 1.63

Depreciation, depletion and amortization expense increased during the year ended December 31, 2024 compared to the same period in the prior year primarily due to increased depreciation resulting from asset additions and shortened mine lives.

Depletion expense increased primarily as a result of increased volume from the Shoal Creek Mine.

The increases in the weighted-average depletion rate per ton for both the Seaborne Metallurgical and the Other U.S.

Depreciation, depletion and amortization expense increased during the year ended December 31, 2025 compared to the same period in the prior year primarily due to increased depreciation resulting from asset additions and increased depletion expense primarily due to increased volume from the Shoal Creek and Centurion Mines.

The changes in the weighted-average depletion rate per ton for the Seaborne Thermal, the Seaborne Metallurgical and the Other U.S.

Thermal segments during the year ended December 31, 2025 compared to the same period in the prior year reflect the impact of volume and mix variances across the segments.

Transaction Costs Related to Business Combinations.

The charges recorded during the current year period relate to the planned acquisition of multiple metallurgical coal mines from Anglo which was announced during the fourth quarter of 2024.

Asset Retirement Obligation Expenses.

Asset retirement obligation expenses decreased during the year ended December 31, 2025 compared to the same period in the prior year due to favorable revisions to the estimates for closed mines.

Costs Related to Terminated Acquisition.

These costs relate to the terminated acquisition of multiple metallurgical coal mines from Anglo.

In addition to typical costs, such as legal and professional fees, the charges include commitment and duration fees on the bridge loan facility of $20.8 million and $25.9 million, respectively, during the year ended December 31, 2025.

Refer to Note 1.

“Other Events” to the accompanying consolidated financial statements for further information regarding the planned acquisition, which information is incorporated herein by reference.

Provision for NARM and Shoal Creek Losses.

The provision recorded during the prior year period was for losses related to the events at the NARM and Shoal Creek Mines as discussed in Note 17.

“Other Events” to the accompanying consolidated financial statements.

Incremental repair costs related to the tornado damage at NARM were recorded during the year ended December 31, 2024.

“Summary of Significant Accounting Policies” and Note 20.

“Commitments and Contingencies” to the accompanying consolidated financial statements for further information regarding the acquisition, which information is incorporated herein by reference.

Shoal Creek Insurance Recovery - Property Damage .

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Of this amount, Adjusted EBITDA excludes an allocated amount applicable to losses recognized at the time of the insurance recovery related to longwall development and equipment deemed inoperable within the affected area of the mine, which consisted of $28.7 million recognized during the year ended December 31, 2023.

The remaining $80.8 million, applicable to incremental costs and business interruption recoveries, is included in Adjusted EBITDA for the year ended December 31, 2024.

Interest Expense, Net of Capitalized Interest.

The decrease in interest expense during the year ended December 31, 2024 compared to the prior year was driven by lower interest and fees for financial assurance instruments and the capitalization of interest related to the development of the Centurion Mine.

Net Loss on Early Debt Extinguishment.

The net loss on early debt extinguishment recognized during the prior year was primarily related to the Company’s terminated letter of credit facility, as further discussed in Note 20.

“Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees” to the accompanying consolidated financial statements.

The remaining $80.8 million, applicable to incremental costs and business interruption recoveries, was included in Adjusted EBITDA for the year ended December 31, 2024.

Interest Income.

The decrease in interest income during the year ended December 31, 2025 compared to the prior year was driven by lower average cash balances during the current period.

Net Mark-to-Market Adjustment on Actuarially Determined Liabilities.

The gain recorded during the year ended December 31, 2025 was driven by the favorable impacts of changes for the postretirement benefit plans related to updated claims experience and favorable expected future claims costs, based upon recent Centers for Medicare and Medicaid Services direct subsidy announcements ($15.1 million) and mark-to-market gains on pension plan assets ($2.1 million).

These increases were offset by negative adjustments to Peabody’s black lung compensation liabilities resulting from increased claims ($4.5 million), decreases to the discount rates for all actuarially determined liabilities ($3.9 million) and unfavorable impacts of medical trend updates for the postretirement benefit plans ($3.8 million).

Peabody Energy Corporation 2025 Form 10-K

The gain recorded during the year ended December 31, 2024 was driven by the favorable impacts of changes for the postretirement benefit plans related to updated claims experience ($12.4 million) and increases to the discount rates for all actuarially determined liabilities ($5.7 million).

These increases were offset by negative adjustments to Peabody’s black lung and traumatic workers’ compensation liabilities resulting from increased claims ($8.8 million) and mark-to-market losses on pension plan assets ($5.4 million).

The gain recorded during the year ended December 31, 2023 was driven by the favorable impacts of changes for the postretirement benefit plans related to updated claims experience ($5.4 million) and mark-to-market gains on pension and postretirement benefit plan assets ($3.9 million).

These increases were offset by decreases to the discount rates for all actuarially determined liabilities ($6.4 million) and a negative adjustment related to Peabody’s black lung liabilities ($2.6 million).

Unrealized Gains on Derivative Contracts Related to Forecasted Sales.

The prior year unrealized gains primarily relate to mark-to-market activity on derivative contracts related to forecasted coal sales.

As further discussed in Note 6.

“Derivatives and Fair Value Measurements” to the accompanying consolidated financial statements, all derivative contracts related to forecasted coal sales settled in 2023.

Peabody Energy Corporation 2024 Form 10-K

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Unrealized (Losses) Gains on Foreign Currency Option Contracts.

Unrealized (losses) gains primarily relate to mark-to-market activity on foreign currency option contracts.

Unrealized Gains (Losses) on Foreign Currency Option Contracts.

Unrealized gains (losses) primarily relate to mark-to-market activity on foreign currency option contracts.

For additional information, refer to Note 5.

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Income Tax Provision .

The decrease in the income tax provision recorded during the year ended December 31, 2024 compared to the prior year period was primarily due to lower pretax income.

The decrease in the income tax provision recorded during the year ended December 31, 2025 compared to the prior year period was primarily due to lower pretax income from the Company’s tax-paying foreign jurisdictions.

Refer to Note 7.

“Income Taxes” to the accompanying consolidated financial statements for additional information.

Net Income Attributable to Common Stockholders

The following table presents net income attributable to common stockholders:

Net (Loss) Income Attributable to Common Stockholders

The following table presents net (loss) income attributable to common stockholders:

(Decrease) Increase

Year Ended December 31, to Income

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(Dollars in millions)

Income from continuing operations, net of income taxes $ 407.3 $ 816.0 $ (408.7) (50.1) %

(Loss) income from continuing operations, net of income taxes $ (42.3) $ 407.3 $ (449.6) (110.4) %

Loss from discontinued operations, net of income taxes (0.2) (3.8) 3.6 94.7 %

Net income 403.5 815.6 (412.1) (50.5) %

Net (loss) income (42.5) 403.5 (446.0) (110.5) %

Net income attributable to noncontrolling interests 10.4 32.6 (22.2) (68.1) %

Net income attributable to common stockholders $ 370.9 $ 759.6 $ (388.7) (51.2) %

Net (loss) income attributable to common stockholders $ (52.9) $ 370.9 $ (423.8) (114.3) %

Net Income Attributable to Noncontrolling Interests .

The decrease in net income attributable to noncontrolling interests during the year ended December 31, 2024 compared to the prior year period was primarily due to a decline in the financial results of Peabody’s majority-owned Wambo operations in which there is an outside non-controlling interest.

The decrease in net income attributable to noncontrolling interests during the year ended December 31, 2025 compared to the prior year period was primarily due to a decline in the financial results of Peabody’s majority-owned Wambo operation in which there is an outside non-controlling interest.

Diluted Earnings per Share (EPS)

The following table presents diluted EPS:

Year Ended December 31, EPS

(Decrease) Increase

Year Ended December 31, to EPS

2025 2024 $ %

Diluted EPS attributable to common stockholders:

Income from continuing operations $ 2.73 $ 5.00 $ (2.27) (45.4) %

Loss from discontinued operations (0.03) — (0.03) n.m.

Net income attributable to common stockholders $ 2.70 $ 5.00 $ (2.30) (46.0) %

(Loss) income from continuing operations $ (0.43) $ 2.73 $ (3.16) (115.8) %

Loss from discontinued operations — (0.03) 0.03 100.0 %

Net (loss) income attributable to common stockholders $ (0.43) $ 2.70 $ (3.13) (115.9) %

Diluted EPS is commensurate with the changes in results from continuing operations and discontinued operations during that period.

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Peabody Energy Corporation 2025 Form 10-K

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Reconciliation of Non-GAAP Financial Measures

Adjusted EBITDA is defined as income from continuing operations before deducting net interest expense, income taxes, asset retirement obligation expenses and depreciation, depletion and amortization.

Adjusted EBITDA is also adjusted for the discrete items that management excluded in analyzing the segments’ operating performance, as displayed in the reconciliations below.

Adjusted EBITDA is defined as (loss) income from continuing operations before deducting net interest expense, income taxes, asset retirement obligation expenses and depreciation, depletion and amortization.

Adjusted EBITDA is also adjusted for the discrete items that management excluded in analyzing the reportable segments’ operating performance, as displayed in the reconciliations below.

Year Ended December 31,

(Dollars in millions)

Income from continuing operations, net of income taxes $ 407.3 $ 816.0

(Loss) income from continuing operations, net of income taxes $ (42.3) $ 407.3

Depreciation, depletion and amortization 384.5 343.0

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Restructuring charges 9.5 4.4

Transaction costs related to business combinations 10.3 —

Asset impairment — 2.0

Provision for NARM and Shoal Creek losses 3.7 40.9

Costs related to terminated acquisition 78.9 10.3

Shoal Creek insurance recovery - property damage — (28.7)

Changes in amortization of basis difference related to equity affiliates (2.7) (1.8)

Other operating loss 5.6 3.7

Interest expense, net of capitalized interest 43.9 46.9

Net loss on early debt extinguishment — 8.8

Interest income (55.4) (71.0)

Net mark-to-market adjustment on actuarially determined liabilities (5.4) (6.1)

Unrealized gains on derivative contracts related to forecasted sales — (159.0)

Unrealized losses (gains) on foreign currency option contracts 9.0 (7.4)

Unrealized (gains) losses on foreign currency option contracts (6.0) 9.0

Take-or-pay contract-based intangible recognition (1.0) (3.0)

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Total Adjusted EBITDA $ 454.9 $ 871.7

Total Segment Costs is defined as operating costs and expenses adjusted for the discrete items that management excluded in analyzing each of its segments’ operating performance, as displayed in the reconciliations below:

Total Segment Costs is defined as operating costs and expenses adjusted for the discrete items that management excluded in analyzing each of its reportable segments’ operating performance, as displayed in the reconciliations below:

Year Ended December 31,

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Operating costs and expenses $ 3,334.9 $ 3,420.9

Unrealized (losses) gains on foreign currency option contracts (9.0) 7.4

Unrealized gains (losses) on foreign currency option contracts 6.0 (9.0)

Take-or-pay contract-based intangible recognition 1.0 3.0

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Total Segment Costs $ 3,312.2 $ 3,374.3

The following table presents Total Segment Costs by reporting segment:

Year Ended December 31,

(Dollars in millions)

Seaborne Thermal $ 783.9 $ 752.9

Seaborne Metallurgical 893.9 863.8

Powder River Basin 960.2 1,044.4

Thermal 671.8 680.7

Corporate and Other 64.5 11.6

Total Segment Costs $ 3,374.3 $ 3,353.4

Peabody Energy Corporation 2024 Form 10-K

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Revenue per Ton and Adjusted EBITDA Margin per Ton are equal to revenue by segment and Adjusted EBITDA by segment (excluding insurance recoveries), respectively, divided by segment tons sold.

Costs per Ton is equal to Revenue per Ton less Adjusted EBITDA Margin per Ton.

The following tables present tons sold, revenue, Total Segment Costs and Adjusted EBITDA by operating segment:

Peabody Energy Corporation 2025 Form 10-K

The following tables present tons sold, revenue, Total Segment Costs and Adjusted EBITDA by reportable segment:

Year Ended December 31, 2025

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Total Segment Costs 686.3 980.2 977.2 635.9

Adjusted EBITDA, excluding Shoal Creek insurance recovery $ 430.0 $ 161.7 $ 138.6 $ 150.8

Shoal Creek insurance recovery - business interruption — 80.8 — —

Adjusted EBITDA $ 222.2 $ 56.4 $ 175.8 $ 71.4

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Costs per Ton 44.55 114.31 11.56 47.49

47.71 122.77 12.07 46.04

Adjusted EBITDA Margin per Ton $ 14.42 $ 6.57 $ 2.08 $ 5.33

$ 26.17 $ 22.20 $ 1.74 $ 10.34

Year Ended December 31, 2024

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Total Segment Costs 783.9 893.9 960.2 671.8

Adjusted EBITDA, excluding Shoal Creek insurance recovery $ 430.0 $ 161.7 $ 138.6 $ 150.8

Shoal Creek insurance recovery - business interruption — 80.8 — —

Adjusted EBITDA $ 430.0 $ 242.5 $ 138.6 $ 150.8

$ 576.8 $ 438.1 $ 153.7 $ 207.5

Revenue per Ton $ 73.88 $ 144.97 $ 13.81 $ 56.38

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The Company has also generated cash from the sale of non-strategic assets, including coal reserves, coal resources and surface lands, and, from time to time, borrowings under its credit facilities and the issuance of securities.

The Company’s primary uses of cash include the cash costs of coal production, capital expenditures, coal reserve lease and royalty payments, debt service costs, finance and operating lease payments, postretirement plans, take-or-pay obligations, post-mining reclamation obligations, collateral and margining requirements, dividends, share repurchases and selling and administrative expenses.

The Company has also used cash for early debt retirements.

The Company’s primary uses of cash include the cash costs of coal production, capital expenditures, coal reserve lease and royalty payments, debt service costs, finance and operating lease payments, early debt retirements, postretirement plans, take-or-pay obligations, post-mining reclamation obligations, collateral requirements, dividends, share repurchases and selling and administrative expenses.

Any future determinations to return capital to stockholders, such as dividends or share repurchases, will depend on a variety of factors, including the Company’s net income or other sources of cash, liquidity position and potential alternative uses of cash, such as internal development projects or acquisitions, as well as economic conditions and expected future financial results.

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Peabody Energy Corporation 2025 Form 10-K

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As of December 31, 2025, the Company’s cash and cash equivalents balances totaled $575.3 million, including approximately $413 million held by U.S.

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If foreign-held cash is repatriated in the future, the Company does not expect restrictions or potential taxes will have a material effect to its near-term liquidity.

The Company’s available liquidity increased to $1,072.5 million as of December 31, 2024 from $1,059.7 million as of December 31, 2023.

The Company’s available liquidity decreased to $942.1 million as of December 31, 2025 from $1,072.5 million as of December 31, 2024.

Available liquidity was comprised of the following:

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Capital Returns to Shareholders

The Company repurchased approximately 7.7 million shares of its common stock for $180.5 million, including commission fees, and paid dividends of $37.6 million during the year ended December 31, 2024.

The Company paid dividends of $36.5 million during the year ended December 31, 2025.

Surety Agreement Amendment and Collateral Requirements

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Under the April 2023 amendment, the Company and its surety providers agreed to a maximum aggregate collateral amount based upon bonding levels which will vary prospectively as bonding levels increase or decrease.

The amendment extended the agreement through December 31, 2026.

The amendment also extended the agreement through December 31, 2026.

In order to maintain the maximum collateral agreement, the Company must remain compliant with a minimum liquidity test and a maximum net leverage ratio, as measured each quarter.

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At December 31, 2025, the Company’s maximum aggregate collateral amount was $509.9 million, which was comprised of $383.6 million in trust accounts and letters of credit of $126.3 million held for the benefit of certain surety providers.

The amendment became effective on April 14, 2023, when the Company terminated a then-existing credit agreement.

Credit Support Facilities

In February 2022, the Company entered into an agreement, which provides up to $250.0 million of capacity for irrevocable standby letters of credit, primarily to support reclamation bonding requirements.

The agreement requires the Company to provide cash collateral at a level of 103% of the aggregate amount of letters of credit outstanding under the arrangement (limited to $5.0 million total excess collateralization.) Outstanding letters of credit bear a fixed fee in the amount of 0.75% per annum.

The initial agreement required the Company to provide cash collateral at a level of 103% of the aggregate amount of letters of credit outstanding under the arrangement (limited to $5.0 million total excess collateralization.) Outstanding letters of credit bear a fixed fee in the amount of 0.75% per annum.

The Company receives a variable deposit rate on the amount of cash collateral posted in support of letters of credit.

The agreement has an initial expiration date of December 31, 2025.

The agreement was amended on November 3, 2025, to (i) extend the expiration date to December 31, 2030 and (ii) reduce the required minimum cash collateral amount to 102% of the aggregate amount of letters of credit outstanding under the agreement, provided that in the event the Company’s credit rating falls below certain thresholds, the minimum collateral amount shall increase to 103%.

At December 31, 2025, letters of credit of $114.6 million were outstanding under the agreement, which were collateralized by cash of $116.9 million.

Peabody Energy Corporation 2025 Form 10-K

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In December 2023, the Company established cash-backed bank guarantee facilities, primarily to support Australian reclamation bonding requirements.

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Revolving Credit Facility

The Company established a new revolving credit facility with a maximum aggregate principal amount of $320.0 million in revolving commitments by entering into a credit agreement, dated as of January 18, 2024 (the 2024 Credit Agreement), by and among the Company, as borrower, certain subsidiaries of the Company party thereto, PNC Bank, National Association, as administrative agent, and the lenders party thereto.

The Company established a revolving credit facility with a maximum aggregate principal amount of $320.0 million in revolving commitments by entering into a credit agreement, dated as of January 18, 2024 (the 2024 Credit Agreement), by and among the Company, as borrower, certain subsidiaries of the Company party thereto, PNC Bank, National Association, as administrative agent, and the lenders party thereto.

The revolving commitments and any related loans, if applicable (any such loans, the Revolving Loans), established by the 2024 Credit Agreement terminate or mature, as applicable, on January 18, 2028, subject to certain conditions relating to the Company’s outstanding 2028 Convertible Notes.

The Revolving Loans bear interest at a secured overnight financing rate (SOFR) plus an applicable margin ranging from 3.50% to 4.25%, depending on the Company’s total net leverage ratio (as defined under the 2024 Credit Agreement) or a base rate plus an applicable margin ranging from 2.50% to 3.25%, at the Company’s option.

The Revolving Loans bear interest at a secured overnight financing rate plus an applicable margin ranging from 3.50% to 4.25%, depending on the Company’s total net leverage ratio (as defined under the 2024 Credit Agreement) or a base rate plus an applicable margin ranging from 2.50% to 3.25%, at the Company’s option.

Letters of credit issued under the 2024 Credit Agreement incur a combined fee equal to an applicable margin ranging from 3.50% to 4.25% plus a fronting fee equal to 0.125% per annum.

Unused capacity under the 2024 Credit Agreement bears a commitment fee of 0.50% per annum.

On November 25, 2024, the Company amended the 2024 Credit Agreement to, among other things, permit Peabody’s planned acquisition of multiple coal mines from Anglo, the related bridge loan facility and the incurrence of additional indebtedness to finance the acquisition, to the extent applicable.

On November 25, 2024, the Company amended the 2024 Credit Agreement to, among other things, permit (i) Peabody’s then-planned acquisition of multiple coal mines from Anglo, (ii) the related bridge loan facility and (iii) the incurrence of additional indebtedness to finance the acquisition, subject to compliance with certain pro forma financial covenants.

As further discussed in Note 1.

“Summary of Significant Accounting Policies,” Peabody terminated the acquisition with Anglo on August 19, 2025.

As of December 31, 2025, the 2024 Credit Agreement had only been utilized for letters of credit, including $49.2 million outstanding as of December 31, 2025.

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For 2026, the Company is targeting total capital expenditures of approximately $340 million.

Approximately $280 million of such amount is appropriated to major projects and growth capital expenditures, including approximately $250 million for the Company’s Centurion Mine, which includes capital expenditures to reach longwall production and capital expenditures to develop Centurion North.

The Company’s total indebtedness as of December 31, 2025 and 2024 is presented in the table below.

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Long-term debt $ 321.2 $ 332.3

The Company’s indebtedness requires estimated contractual principal and interest payments, assuming interest rates in effect at December 31, 2024, of approximately $27 million in 2025, $18 million in 2026, $13 million in 2027, $326 million in 2028, less than $1 million in 2029 and $9 million thereafter.

The Company’s indebtedness requires estimated contractual principal and interest payments, assuming interest rates in effect at December 31, 2025, of approximately $25 million in 2026, $16 million in 2027, $327 million in 2028 and less than $1 million in 2029 and thereafter.

Peabody Energy Corporation 2025 Form 10-K

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Cash paid for interest, net of capitalized interest related to the Company’s indebtedness and financial assurance instruments amounted to $37.6 million, $61.9 million and $118.5 million during the years ended December 31, 2024, 2023, and 2022, respectively.

The Company paid cash of $39.5 million, $37.6 million and $61.9 million during the years ended December 31, 2025, 2024, and 2023, respectively, for interest, net of capitalized interest, related to the Company’s indebtedness and financial assurance instruments.

2028 Convertible Notes

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The 2028 Convertible Notes bear interest at a rate of 3.250% per year, payable semi-annually in arrears on March 1 and September 1 of each year.

During the fourth quarter ended December 31, 2024, the Company’s reported common stock prices did not prompt the conversion feature of the 2028 Convertible Notes.

As a result, the 2028 Convertible Notes will not be convertible during the first quarter of 2025.

Bridge Loan Facility

Concurrently with its entry into definitive agreements to acquire the Anglo assets, the Company entered into a bridge loan facility commitment letter (the Bridge Commitment Letter, and the senior secured 364-day bridge facility provided for therein, the Bridge Facility), pursuant to which the lenders, agreed to provide the Bridge Facility to the Company in the amount of up to $2.075 billion in order to finance the planned acquisition in part.

The Company expects to replace the Bridge Facility with permanent financing prior to the closing date, but there can be no assurance such financing will occur and any such expectation is subject to market conditions.

To the extent borrowings are made under the Bridge Facility, any loans would bear interest at a SOFR plus an applicable margin of 8.00% or a base rate plus an applicable margin of 7.00%, at the Company’s option.

Such applicable margin would increase by an additional 0.75% on the date that is 90 days following the closing date of the planned acquisition.

Any borrowings under the Bridge Facility would mature 364 days from the initial funding date, which would be on or around the closing date of the planned acquisition.

The availability of borrowings under the Bridge Facility is subject to the satisfaction of certain customary conditions for transactions of this type.

Any definitive financing documentation for the Bridge Facility will contain customary representations and warranties, covenants and events of defaults for transactions of this type.

Upon execution of any definitive financing documentation for the Bridge Facility, the Bridge Facility will be guaranteed by substantially all U.S.

subsidiaries of the Company and secured by substantially all assets of the Company, its U.S.

subsidiaries and, subject to certain conditions, certain of the Company’s Australian subsidiaries.

During the fourth quarter of 2025, the Company’s reported common stock prices prompted the conversion feature of the 2028 Convertible Notes.

As a result, the 2028 Convertible Notes are convertible at the option of the holders during the first quarter of 2026.

It is the Company’s current intent and policy to settle any conversions of the 2028 Convertible Notes through shares of its common stock.

As such, the 2028 Convertible Notes are not classified as a current obligation in the accompanying consolidated balance sheets.

Through February 18, 2026, the Company has not received any conversion requests and does not anticipate receiving any conversion requests in the near term as the market value of the 2028 Convertible Notes exceeds their conversion value.

Accounts Receivable Securitization Program

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“Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees” of the accompanying consolidated financial statements, the Company entered into an accounts receivable securitization program during 2017.

The securitization program was amended in February 2023 to increase the available funding capacity from $175.0 million to $225.0 million and adjust the relevant interest rate for borrowings to a SOFR plus an applicable margin.

Funding capacity is limited to the availability of eligible receivables and is accounted for as a secured borrowing.

The securitization program provides up to $225.0 million of funding capacity which is accounted for as a secured borrowing, limited to the availability of eligible receivables, and may be secured by a combination of collateral and the trade receivables underlying the program.

Funding capacity under the program may also be utilized for letters of credit in support of other obligations, which has been the Company’s primary utilization.

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Such cash flows pertain to postretirement benefit plans, work-related injuries and illnesses, defined benefit pension plans, mine reclamation and end-of-mine closure costs and exploration obligations and are estimated to amount to approximately $110 million in 2026, $90 million in 2027, $85 million in 2028, $65 million in 2029, $75 million in 2030 and $1,318 million thereafter.

Peabody Energy Corporation 2024 Form 10-K

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The Company has various short- and long-term take-or-pay arrangements in Australia and the U.S.

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The Company was compliant with all relevant covenants under its debt and other finance agreements at December 31, 2025.

Peabody Energy Corporation 2025 Form 10-K

The following table summarizes the Company’s cash flows for the years ended December 31, 2025 and 2024, as reported in the accompanying consolidated financial statements.

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Operating Activities .

The decrease in net cash provided by operating activities for the year ended December 31, 2024 compared to the prior year was driven by a year-over-year decrease in operating cash flow from working capital ($359.7 million), primarily attributable to changes in accounts payable and accrued expenses ($305.1 million) driven by income tax payments and accounts receivable ($66.5 million);

the prior year receipt of cash related to variation margin requirements associated with derivative financial instruments ($198.0 million);

and lower cash generated from mining operations.

These unfavorable variances were partially offset by the Shoal Creek insurance recovery excluding proceeds attributable to equipment losses ($98.6 million), decreases in cash used for collateral requirements ($348.7 million) and discontinued operations ($74.5 million) primarily related to the prior year use of cash to settle disputed black lung claims.

The decrease in net cash provided by operating activities for the year ended December 31, 2025 compared to the prior year was driven by a year-over-year decrease in cash from collateral arrangements resulting from prior year collateral releases ($156.4 million), costs related to the terminated Anglo acquisition ($68.6 million) and lower cash from mining operations.

These decreases were partially offset by a year-over-year increase in operating cash flow from working capital ($302.3 million), primarily attributable to changes in accounts payable and accrued expenses ($195.2 million) driven by prior year income tax payments.

Investing Activities .

The increase in net cash used in investing activities for the year ended December 31, 2024 compared to the prior year was driven by the acquisition of Wards Well ($143.8 million), the deposit for the planned Anglo acquisition ($75.0 million) and higher capital expenditures driven by the Centurion Mine development ($53.0 million).

These variances were partially offset by the Shoal Creek insurance recovery attributable to equipment losses ($10.9 million).

The decrease in net cash used in investing activities for the year ended December 31, 2025 compared to the prior year was driven by a decrease due to the prior year Wards Well acquisition ($143.8 million), the prior year deposit related to the terminated acquisition ($75.0 million) and the returned deposit related to the terminated acquisition ($29.0 million).

Financing Activities .

The decrease in net cash used in financing activities for the year ended December 31, 2024 compared to the prior year was primarily driven by decreases in common stock repurchases ($164.6 million) and distributions to noncontrolling interest ($24.2 million).

The decrease in net cash used in financing activities for the year ended December 31, 2025 compared to the prior year was primarily driven by decreases in common stock repurchases ($183.1 million).

Off-Balance-Sheet Arrangements

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The Company does not expect any material losses to result from these guarantees or off-balance-sheet instruments in excess of liabilities provided for in the accompanying consolidated balance sheets.

Peabody Energy Corporation 2024 Form 10-K

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The following table summarizes the Company’s financial instruments that carry off-balance-sheet risk:

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Obligations supported, net $ 908.8 $ 145.8 $ 1,054.6

(1) Instruments support obligations related to pension and health care plans, workers’ compensation, property and casualty insurance, customer and vendor contracts and certain restoration ancillary to prior mining activities.

(1) Instruments support obligations related to leases, health care plans, workers’ compensation, property and casualty insurance, customer and vendor contracts and certain restoration ancillary to prior mining activities.

(2) Amounts do not include cash-collateralized letters of credit.

(3) Certain letters of credit serve as collateral for surety bonds at the request of surety bond providers.

Not presented in the above table is $ 809.8 million of restricted cash and other balances serving as collateral which are included in the accompanying consolidated balance sheets at December 31, 2024, as described in Note 20.

Peabody Energy Corporation 2025 Form 10-K

Not presented in the above table is $ 844.1 million of restricted cash and collateral which are included in the accompanying consolidated balance sheets at December 31, 2025, as described in Note 19.

“Financial Instruments, Guarantees With Off-Balance-Sheet Risk and Other Guarantees” of the accompanying consolidated financial statements.

Such collateral is primarily in support of the financial instruments noted above, including in relation to the Company’s surety bond portfolio, its collateralized letter of credit agreement, its bank guarantee facilities and amounts held directly with beneficiaries which are not supported by surety bonds.

The restricted cash and collateral balance decreased $147.8 million during the year ended December 31, 2024 due to collateral releases related to reductions in reclamation bonding requirements, replacement of cash-collateralized letters of credit with letters of credit under the new revolving credit facility and the impact of foreign currency rate changes.

The restricted cash and collateral balance increased $34.3 million during the year ended December 31, 2025 due to a net increase in bonding requirements and the impact of foreign currency rate changes.

At December 31, 2025, the Company had total asset retirement obligations of $754.9 million.

Bonding requirement amounts may differ significantly from the related asset retirement obligation because such requirements are calculated under the assumption that reclamation begins currently, whereas the Company’s accounting liabilities are discounted from the end of a mine’s economic life (when final reclamation work would begin) to the balance sheet date.

As noted above, the Company’s reclamation bonding requirements decreased during the year ended December 31, 2024, primarily due to an approximate $110 million reduction in U.S.

reclamation bonding requirements.

At December 31, 2025, the Company’s reclamation bonding requirements were supported by approximately $740 million of restricted cash and other balances serving as collateral, which substantially supports the financial liability for final mine reclamation as calculated in accordance with U.S.

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Actual results may differ from these estimates.

Peabody Energy Corporation 2024 Form 10-K

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Asset Retirement Obligations.

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“Asset Retirement Obligations” to the accompanying consolidated financial statements for additional information regarding the Company’s asset retirement obligations.

Peabody Energy Corporation 2025 Form 10-K

Impairment of Long-Lived Assets.

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These factors may cause the Company to be unable to recover all or a portion of the carrying value of its long-lived assets.

Peabody Energy Corporation 2024 Form 10-K

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The Company identified certain assets with an aggregate carrying value of approximately $64 million at December 31, 2025 in its Other U.S.

Thermal segment whose recoverability is most sensitive to customer concentration risk.

“Asset Impairment” to the accompanying consolidated financial statements for additional information regarding impairment charges.

Income Taxes .

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or expiration of the applicable statute of limitations.

Peabody Energy Corporation 2025 Form 10-K

“Income Taxes” to the accompanying consolidated financial statements for additional information regarding valuation allowances and unrecognized tax benefits.

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A determination of the amount of reserves required for these matters is made after considerable analysis of each individual issue.

Peabody accrues for legal and environmental matters within “Operating costs and expenses” when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

Peabody accrues for legal and environmental matters when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

If a range of possible loss exists and no anticipated loss within the range is more likely than any other anticipated loss, the Company records the accrual at the low end of the range, in accordance with Accounting Standards Codification 450, “Contingencies.”

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis