What changed in this filing

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Item 1. Financial Statements

2025-11-05 compared with 2025-08-06 · 259 added, 215 removed, 768 unchanged (38% of the section changed)

22 unchanged sentences

Equity securities 18,109 18,663

Equity method investment in Eiger, LLC 18,954 19,147

Equity method investment in Eiger Resources

19,066 19,147

Other non-current assets 31,025 25,768

29 unchanged sentences

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

THREE MONTHS ENDED SIX MONTHS ENDED

JUNE 30 JUNE 30

THREE MONTHS ENDED NINE MONTHS ENDED

SEPTEMBER 30 SEPTEMBER 30

2025 2024 2025 2024

4 unchanged sentences

Earnings of unconsolidated operations 16,494 15,155 45,618 42,054

Business interruption insurance recoveries — 13,612 — 13,612

Operating expenses

4 unchanged sentences

19,688 16,312 57,655 45,124

Operating (loss) profit ( 51 ) 7,366 7,631 12,123

Other (income) expense

Operating profit 6,777 19,699 14,408 31,822

Other expense (income)

Interest expense 1,087 1,386 4,805 3,808

17 unchanged sentences

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

THREE MONTHS ENDED SIX MONTHS ENDED

JUNE 30 JUNE 30

THREE MONTHS ENDED NINE MONTHS ENDED

SEPTEMBER 30 SEPTEMBER 30

2025 2024 2025 2024

1 unchanged sentence

Net income $ 13,254 $ 15,635 $ 21,414 $ 26,177

Reclassification of pension and postretirement adjustments into earnings, net of $ 34 and $ 65 tax benefit in the three and six months ended June 30, 2025, respectively, and net of $ 25 and $ 48 tax benefit in the three and six months ended June 30, 2024, respectively.

Reclassification of pension and postretirement adjustments into earnings, net of $ 32 and $ 97 tax benefit in the three and nine months ended September 30, 2025, respectively, and net of $ 20 and $ 68 tax benefit in the three and nine months ended September 30, 2024, respectively.

109 78 326 231

5 unchanged sentences

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

SIX MONTHS ENDED

NINE MONTHS ENDED

(In thousands)

Operating activities

Net cash used for operating activities $ ( 2,753 ) $ ( 5,698 )

Net cash provided by (used for) operating activities $ 39,502 $ ( 2,879 )

Investing activities

39 unchanged sentences

Balance, June 30, 2024 $ 5,788 $ 1,566 $ 30,451 $ 355,786 $ ( 9,501 ) $ 384,090

Stock-based compensation 12 — 1,170 — — 1,182

Purchase of treasury shares ( 68 ) — — ( 1,949 ) — ( 2,017 )

— — — 15,635 — 15,635

Cash dividends on Class A and Class B common stock:

$ 0.2275 per share

— — — ( 1,658 ) — ( 1,658 )

Reclassification adjustment to net income, net of tax — — — — 78 78

Balance, September 30, 2024 $ 5,732 $ 1,566 $ 31,621 $ 367,814 $ ( 9,423 ) $ 397,310

Balance, January 1, 2025 $ 5,730 $ 1,566 $ 34,340 $ 373,363 $ ( 10,052 ) $ 404,947

17 unchanged sentences

Balance, June 30, 2025 $ 5,888 $ 1,564 $ 38,223 $ 377,280 $ ( 9,835 ) $ 413,120

Stock-based compensation 8 — 1,793 — — 1,801

Net income — — — 13,254 — 13,254

Cash dividends on Class A and Class B common stock:

$ 0.2525 per share

— — — ( 1,882 ) — ( 1,882 )

Reclassification adjustment to net income, net of tax — — — — 109 109

Balance, September 30, 2025 $ 5,896 $ 1,564 $ 40,016 $ 388,652 $ ( 9,726 ) $ 426,402

See notes to Unaudited Condensed Consolidated Financial Statements.

2 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2025

SEPTEMBER 30, 2025

(In thousands, except as noted and per share amounts)

12 unchanged sentences

These items primarily include administrative costs related to public company reporting requirements, including management and board compensation, and the financial results of Bellaire Corporation (Bellaire), Mitigation Resources, ReGen Resources and other developing businesses.

Bellaire manages our long-term liabilities related to former Eastern U.S.

Bellaire manages its long-term liabilities related to former Eastern U.S.

underground mining activities.

1 unchanged sentence

See Note 7 for further discussion of segment reporting.

During the second quarter of 2025, we changed the names of our reportable segments to make it easier for our stakeholders to understand the business activities within each segment.

During 2025, we changed the names of our reportable segments to make it easier for our stakeholders to understand the business activities within each segment.

The Utility Coal Mining, Contract Mining and Minerals and Royalties segments were formerly the Coal Mining, North American Mining and Minerals Management segments, respectively.

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Each mine is fully integrated with the operation of these facilities.

During the three and six months ended June 30, 2025, the Utility Coal Mining segment's operating coal mines were:

During the three and nine months ended September 30, 2025, the Utility Coal Mining segment's operating coal mines were:

The Coteau Properties Company (Coteau), Coyote Creek Mining Company, LLC (Coyote Creek), The Falkirk Mining Company (Falkirk) and Mississippi Lignite Mining Company (MLMC).

1 unchanged sentence

Each of these mines produce lignite coal.

While MLMC’s coal supply contract contains a take or pay provision, the contract contains a force majeure provision that allows for the temporary suspension of the take or pay provision during the duration of certain specified events beyond the control of either party;

all other coal supply contracts are requirements contracts.

While MLMC’s coal supply contract contains a take or pay provision, all other coal supply contracts are requirements contracts.

Certain coal supply contracts can be terminated early, which would result in a reduction to future earnings.

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inflation rates and includes adjustments for coal quality and certain reimbursable costs.

Profitability at MLMC is affected by customer demand for coal and changes in the indices that determine sales price and actual costs incurred.

As diesel fuel is heavily weighted among the indices used to determine the coal sales price, fluctuations in diesel fuel prices can result in significant fluctuations in earnings at MLMC.

Profitability at MLMC is affected by customer demand for coal, changes in the contractually determined sales price and actual costs incurred.

MLMC's customer operates the Red Hills Power Plant, which supplies electricity to the Tennessee Valley Authority (TVA) under a long-term power purchase agreement.

MLMC’s contract with its customer runs through April 1, 2032.

Current mine area reserves are sufficient to meet contractual requirements through the 2032 contract term.

TVA’s power portfolio includes coal, nuclear, hydroelectric, natural gas and renewables.

The decision regarding which power plants to dispatch is determined by TVA.

Reduction in dispatch and/or reduced mechanical availability of the Red Hills Power Plant will result in reduced earnings at MLMC.

As a significant portion of MLMC’s costs are fixed, reduction in dispatch and/or reduced mechanical availability of the Red Hills Power Plant can increase per ton costs and materially affect operating results at MLMC.

Conversely, periods of higher dispatch can improve results.

The Red Hills Power Plant operated at below full baseload capacity

and experienced periods of reduced mechanical availability during 2024 and 2025.

These factors increased per ton operating costs which adversely affected operating results in both 2024 and 2025.

In December 2023, MLMC received notice from its customer related to a boiler issue at the Red Hills Power Plant.

While this issue has been resolved, it resulted in a reduction in customer demand which had a significant impact on our results of operations during 2024.

We recognized income of $ 13.6 million in the third quarter of 2024 related to business interruption insurance recoveries to partially offset losses related to the boiler outage.

The Sabine Mining Company (Sabine) operates the Sabine Mine in Texas.

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Sabine will provide mine reclamation services through September 30, 2026.

As of October 1, 2026, SWEPCO has an obligation to acquire all of the capital stock of Sabine and complete the remaining mine reclamation.

As of October 1, 2026, SWEPCO is obligated to acquire all of the capital stock of Sabine and complete the remaining mine reclamation.

At Coteau, Coyote Creek and Falkirk, we are paid a management fee per ton of coal or heating unit (MMBtu) delivered.

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For tax purposes, the Unconsolidated Subsidiaries are included within our consolidated U.S.

therefore, the Income tax provision line on the Unaudited Condensed Consolidated Statements of Operations includes income taxes related to these entities.

therefore, the Income tax (benefit) provision line on the Unaudited Condensed Consolidated Statements of Operations includes income taxes related to these entities.

See Note 6 for further information on the Unconsolidated Subsidiaries.

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materials handling and processing, product sales and distribution.

As of June 30, 2025, Contract Mining operates at quarries in Florida, Arkansas and Nebraska and is overseeing the construction of a dragline in Arizona.

As of September 30, 2025, Contract Mining operates at quarries in Florida, Arkansas and Nebraska and is expected to begin operations upon dragline commission at a quarry in Arizona during the first quarter of 2026.

In addition, Sawtooth Mining, LLC (Sawtooth) will be the exclusive provider of comprehensive mining services for the Thacker Pass lithium project in Humboldt County, Nevada.

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LAC) and General Motors Holdings LLC.

Department of Energy holds warrants to purchase five percent non-voting, non-transferable equity in this joint venture.

Thacker Pass commenced construction in 2023 and is targeting initial lithium production in late 2027.

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For example, where we own an ORRI in a lease on the same tract of land in which we own a mineral interest, the ORRI in that tract will relate to the same gross acres as the mineral interest in that tract.

As of June 30, 2025 and December 31, 2024, Minerals and Royalties holds an equity investment of $ 19.0 million and $ 19.1 million, respectively, in Eiger, LLC, which holds non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin.

As of September 30, 2025 and December 31, 2024, Minerals and Royalties holds an equity investment of $ 19.1 million in Eiger Resources, which holds non-operated working interests in oil and natural gas assets in the Kansas and the Oklahoma portion of the Hugoton basin.

This entity meets the definition of a VIE.

2 unchanged sentences

Instead, this contract is accounted for as an equity method investment.

During the three months ended June 30, 2025 and 2024, we recorded our share of earnings of $ 0.3 million and $ 0.1 million, respectively.

During the six months ended June 30, 2025 and 2024, we recorded our share of earnings of $ 0.8 million and $ 0.1 million, respectively.

During the three months ended September 30, 2025 and 2024, we recorded our share of earnings of $ 1.1 million and $ 0.2 million, respectively.

During the nine months ended September 30, 2025 and 2024, we recorded our share of earnings of $ 1.9 million and $ 0.4 million, respectively.

These earnings are presented in the line Earnings of unconsolidated operations on the Unaudited Condensed Consolidated Statements of Operations.

Our investment is reported on the line Equity method investment in Eiger, LLC in the Unaudited Condensed Consolidated Balance Sheets.

Due to the timing and availability of Eiger LLC's financial information, earnings or losses from this investment are recorded on a one quarter lag.

During the first quarter of 2025, $ 14.5 million of excess funds from the terminated Falkirk pension plan were directly transferred to the NACCO 401(k) plan.

Our investment is reported on the line Equity method investment in Eiger Resources in the Unaudited Condensed Consolidated Balance Sheets.

Due to the timing and availability of financial information, earnings or losses from this investment are recorded on a one quarter lag.

During the first nine months of 2025, $ 14.5 million of excess funds from the terminated Falkirk pension plan were directly transferred to the NACCO 401(k) plan.

The NACCO 401(k) plan is a qualified replacement plan;

therefore, these funds will be utilized to offset future profit sharing contributions to 401(k) plan participants.

As of June 30, 2025, the remaining $ 12.0 million asset is recorded on the line Prepaid profit sharing and will continue to be reduced as profit sharing contributions are made to employees.

During the second quarter of 2025, the Company and Falkirk’s former customer agreed to settle the corresponding liability for $ 10.9 million, resulting in a gain of $ 3.6 million on the Unaudited Condensed Consolidated Statement of Operations.

In accordance with the agreement reached with the former customer, $ 5.5 million was paid to the former customer during the second quarter of 2025.

The remaining $ 5.4 million, recorded on the line Excess funding liability on the Unaudited Condensed Consolidated Balance Sheet at June 30, 2025, will be paid to the former customer in the second quarter of 2026.

At June 30, 2025 and December 31, 2024, we had $ 17.0 million and $ 14.2 million, respectively, classified as Assets held for sale, primarily for draglines, other equipment and an office building in North Dakota.

During the second quarter of 2024, we sold land for $ 7.0 million and recognized a $ 4.5 million gain in the Minerals and Royalties segment on the Unaudited Condensed Consolidated Statements of Operations.

As of September 30, 2025, the remaining $ 9.6 million asset is recorded on the line Prepaid profit sharing and will continue to be reduced as profit sharing contributions are made to employees.

During the first nine months of 2025, the Company and Falkirk’s former customer agreed to settle the corresponding liability for $ 10.9 million, resulting in a gain of $ 3.6 million on the Unaudited Condensed Consolidated Statement of Operations.

In accordance with the agreement reached with the former customer, $ 5.5 million was paid to the former customer during 2025.

The remaining $ 5.4 million, recorded on the line Excess funding liability on the Unaudited Condensed Consolidated Balance Sheet at September 30, 2025, will be paid to the former customer in 2026.

At September 30, 2025 and December 31, 2024, we had $ 15.4 million and $ 14.2 million, respectively, classified as Assets held for sale.

The assets held for sale consist of draglines not in use and an office building in North Dakota.

During the first nine months of 2024, we sold land for $ 7.0 million and recognized a $ 4.5 million gain in the Minerals and Royalties segment on the Unaudited Condensed Consolidated Statements of Operations.

Accounting Standards Not Yet Adopted:

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GAAP for complete financial statements.

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of our financial position at June 30, 2025, the results of our operations, comprehensive income, cash flows and changes in equity for the six months ended June 30, 2025 and 2024 have been included.

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of our financial position at September 30, 2025, the results of our operations, comprehensive income, cash flows and changes in equity for the nine months ended September 30, 2025 and 2024 have been included.

These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024.

24 unchanged sentences

The transaction price consists of a variable sales-based royalty and, in certain arrangements, a fixed component in the form of an up-front lease bonus payment.

As the amount of consideration we will ultimately be entitled to is entirely susceptible to factors outside of our control, the entire amount of variable consideration is constrained at contract

As the amount of consideration we will ultimately be entitled to is entirely susceptible to factors outside of our control, the entire amount of variable consideration is constrained at contract inception.

We believe that the pricing provisions of royalty contracts are customary in the industry.

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Fluctuations in revenue from period to period generally result from changes in timing of mitigation credit releases and/or customer demand.

For other ecological restoration services, contracts are generally structured as a management fee agreement under which Mitigation Resources is reimbursed for all costs incurred in performing the required services plus an agreed profit percentage or as a fixed fee contract.

For other restoration construction services, contracts are generally structured as an agreement under which Mitigation Resources is reimbursed for all costs incurred in performing the required services plus a fixed fee.

The services provided represent the performance obligation and are accounted for as a series.

2 unchanged sentences

Consistent with the conclusion that the customer simultaneously receives and consumes the benefits provided, an input-based measure of progress is appropriate.

As each month of service is completed, revenue is recognized for the amount of actual costs incurred, plus the management fee or fixed fee.

Fluctuations in revenue from period to period result from changes in customer demand primarily due to increases and decreases in activity levels of individual contracts and variances in reimbursable costs.

As each month of service is completed, revenue is recognized for the amount of actual costs incurred, plus the fixed fee.

Fluctuations in revenue from period to period result from increases and decreases in activity levels of individual contracts and variances in reimbursable costs.

Significant Judgments:

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We typically receive payment for oil and natural gas sales within 90 days of the month of delivery.

For the three months ended June 30, 2025, differences between our first quarter pricing estimates and the actual amounts received from operators in the second quarter were immaterial .

For the three months ended June 30, 2024, differences between our pricing estimates and the actual amounts received from operators resulted in a $ 2.3 million change in estimate.

For the six months ended June 30, 2025 and 2024, change in estimates was immaterial .

For the three and nine months ended September 30, 2025 and September 30, 2024, respectively, differences between our pricing estimates and the actual amounts received from operators were immaterial .

Cost Reimbursement:

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As discussed above, we record royalty income in the month production is delivered to the purchaser.

The expected sales volumes and prices for these properties are estimated and recorded in Trade accounts receivable in the accompanying Unaudited Condensed Consolidated Balance Sheets.

The expected sales volumes and prices for these properties are estimated and recorded in Other current assets in the accompanying Unaudited Condensed Consolidated Balance Sheets.

The difference between our estimates and the actual amounts received is recorded in the month that payment is received from the third-party lessee.

For the three and six months ended June 30, 2025, royalty income recognized in the reporting period relating to production satisfied in prior periods

was immaterial and $ 1.5 million, respectively.

For the three and six months ended June 30, 2024, royalty income recognized in the reporting period relating to production satisfied in prior periods was immaterial .

For the three and nine months ended September 30, 2025, royalty income recognized in the reporting period relating to production satisfied in prior periods was immaterial and $ 1.5 million, respectively.

For the three and nine months ended September 30, 2024, royalty income recognized in the reporting period relating to production satisfied in prior periods was immaterial .

Disaggregation of Revenue:

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See Note 7 to the Unaudited Condensed Consolidated Financial Statements for further discussion of segment reporting.

The following table disaggregates revenue by major sources as of June 30:

THREE MONTHS ENDED SIX MONTHS ENDED

JUNE 30 JUNE 30

The following table disaggregates revenue by major sources as of September 30:

THREE MONTHS ENDED NINE MONTHS ENDED

SEPTEMBER 30 SEPTEMBER 30

2025 2024 2025 2024

12 unchanged sentences

$ 49,706 $ 313 $ 3,500 $ 484 $ 5,119

Balance at June 30, 2025

Balance at September 30, 2025

30,889 332 3,500 1,003 9,514

Increase (decrease) $ ( 18,817 ) $ 19 $ — $ 519 $ 4,395

We expect to recognize $ 1.2 million in the remainder of 2025, $ 0.4 million in 2026 and 2027, $ 1.2 million in 2028, $ 2.6 million in 2029 and $ 4.1 million thereafter related to the contract liability remaining at June 30, 2025.

We expect to recognize $ 0.7 million in the remainder of 2025, $ 0.4 million in 2026 and 2027, $ 1.2 million in 2028, $ 2.6 million in 2029 and $ 5.3 million thereafter related to the contract liability remaining at September 30, 2025.

The difference between the opening and closing balances of our contract balances results from the timing difference between our performance and the customer’s payment.

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Total inventories $ 94,438 $ 94,608

We recorded inventory impairment charges of $ 1.3 million and $ 4.3 million during the three and six months ended June 30, 2025, respectively, and $ 0.7 million and $ 3.1 million during the three and six months ended June 30, 2024, respectively.

We recorded inventory impairment charges of $ 2.7 million and $ 7.0 million during the three and nine months ended September 30, 2025, respectively, and $ 1.0 million and $ 4.1 million during the three and nine months ended September 30, 2024, respectively.

The inventory impairment charges are in the Cost of sales line in the accompanying Unaudited Condensed Consolidated Statements of Operations as mining costs exceeded the net realizable value of coal inventory at MLMC.

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On November 7, 2023, our Board of Directors approved a stock repurchase program (2023 Stock Repurchase Program) providing for the purchase of up to $ 20.0 million of our outstanding Class A Common stock through December 31, 2025.

During the three months ended June 30, 2025 there were no stock repurchases.

During the six months ended June 30, 2025, we repurchased 22,198 shares of Class A Common Stock under the 2023 Stock Repurchase Program for an aggregate purchase price of $ 0.7 million.

During the three and six months ended June 30, 2024, we repurchased 108,371 and 236,058 shares, respectively, of Class A Common Stock under the 2023 Stock Repurchase Program for an aggregate purchase price of $ 3.3 million and $ 7.6 million, respectively.

During the three months ended September 30, 2025 there were no stock repurchases.

During the nine months ended September 30, 2025, we repurchased 22,198 shares of Class A Common Stock for an aggregate purchase price of $ 0.7 million.

During the three and nine months ended September 30, 2024, we repurchased 68,282 and 304,340 shares, respectively, of Class A Common Stock for an aggregate purchase price of $ 2.0 million and $ 9.6 million, respectively.

The timing and amount of any repurchases under the 2023 Stock Repurchase Program are determined at the discretion of our management based on a number of factors, including the availability of capital, other capital allocation alternatives, market conditions for our Class A Common Stock and other legal and contractual restrictions.

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Description Date (Level 1) (Level 2) (Level 3)

June 30, 2025

September 30, 2025

Equity securities $ 18,109 $ 18,109 $ — $ —

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therefore, they are classified as Level 1 within the fair value hierarchy.

The fair value of the Mine Water Treatment Trust was $ 12.5 million and $ 12.3 million at June 30, 2025 and December 31, 2024, respectively, and is recognized as a component of Equity securities in the accompanying Unaudited Condensed Consolidated Balance Sheets.

We recognized a gain of $ 0.8 million and $ 0.5 million during the three and six months ended June 30, 2025, respectively, and a gain of $ 0.3 million and $ 1.0 million during the three and six months ended June 30, 2024, respectively, related to the Mine Water Treatment Trust.

The fair value of the Mine Water Treatment Trust was $ 13.2 million and $ 12.3 million at September 30, 2025 and December 31, 2024, respectively, and is recognized as a component of Equity securities in the accompanying Unaudited Condensed Consolidated Balance Sheets.

We recognized gains of $ 0.7 million and $ 1.2 million during the three and nine months ended September 30, 2025, respectively, and gains of $ 0.6 million and $ 1.5 million during the three and nine months ended September 30, 2024, respectively, related to the Mine Water Treatment Trust.

Prior to 2024, we invested $ 2.0 million in equity securities of a public company with a diversified portfolio of royalty producing mineral interests.

1 unchanged sentence

therefore, it is classified as Level 1 within the fair value hierarchy.

The fair value of this investment was $ 5.3 million and $ 6.3 million at June 30, 2025 and December 31, 2024, respectively, and is recognized as a component of Equity securities in the accompanying Unaudited Condensed Consolidated Balance Sheets.

We recognized a loss of $ 0.4 million and $ 1.0 million during the three and six months ended June 30, 2025, respectively, and a loss of $ 0.5 million and $ 0.2 million during the three and six months ended June 30, 2024, respectively, related to the investment in these equity securities.

The change in fair value of equity securities is reported on the line (Gain) loss on equity securities in the Other (income) expense section of the Unaudited Condensed Consolidated Statements of Operations.

There were no transfers into or out of Levels 1, 2 or 3 during the six months ended June 30, 2025 and 2024.

The fair value of this investment was $ 4.9 million and $ 6.3 million at September 30, 2025 and December 31, 2024, respectively, and is recognized as a component of Equity securities in the accompanying Unaudited Condensed Consolidated Balance Sheets.

We recognized losses of $ 0.4

million and $ 1.4 million during the three and nine months ended September 30, 2025, respectively, and losses of $ 0.1 million and $ 0.3 million during the three and nine months ended September 30, 2024, respectively, related to the investment in these equity securities.

The change in fair value of equity securities is reported on the line (Gain) loss on equity securities in the Other expense (income) section of the Unaudited Condensed Consolidated Statements of Operations.

There were no transfers into or out of Levels 1, 2 or 3 during the nine months ended September 30, 2025 and 2024.

NOTE 6— Unconsolidated Subsidiaries

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See Note 1 for a discussion of these entities.

The Investment in the unconsolidated subsidiaries and related tax positions totaled $ 16.1 million and $ 14.1 million at June 30, 2025 and December 31, 2024, respectively.

Our risk of loss relating to these entities is limited to our invested capital, which was $ 4.8 million and $ 5.5 million at June 30, 2025 and December 31, 2024, respectively.

Earnings of Unconsolidated Subsidiaries were $ 12.9 million and $ 28.3 million during the three and six months ended June 30, 2025, respectively, and $ 13.5 million and $ 26.8 million during the three and six months ended June 30, 2024, respectively.

The Investment in the unconsolidated subsidiaries and related tax positions totaled $ 18.6 million and $ 14.1 million at September 30, 2025 and December 31, 2024, respectively.

Our risk of loss relating to these entities is limited to our invested capital, which was $ 5.7 million and $ 5.5 million at September 30, 2025 and December 31, 2024, respectively.

Earnings of Unconsolidated Subsidiaries were $ 15.4 million and $ 43.7 million during the three and nine months ended September 30, 2025, respectively, and $ 14.9 million and $ 41.8 million during the three and nine months ended September 30, 2024, respectively.

NACCO Natural Resources is a party to certain guarantees related to Coyote Creek.

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The following table provides segment financial information and a reconciliation of segment results to consolidated results:

THREE MONTHS ENDED SIX MONTHS ENDED

JUNE 30 JUNE 30

THREE MONTHS ENDED NINE MONTHS ENDED

SEPTEMBER 30 SEPTEMBER 30

2025 2024 2025 2024

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Total $ 19,688 $ 16,312 $ 57,655 $ 45,124

Operating (loss) profit

Operating profit (loss)

Utility Coal Mining $ 4,987 $ 19,938 $ 10,000 $ 22,288

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*Operating expenses (income) consist of Selling, general and administrative expenses, Amortization of intangible assets and Gain on sale of assets.

THREE MONTHS ENDED SIX MONTHS ENDED

JUNE 30 JUNE 30

THREE MONTHS ENDED NINE MONTHS ENDED

SEPTEMBER 30 SEPTEMBER 30

2025 2024 2025 2024

47 unchanged sentences

Bellaire manages our long-term liabilities related to former Eastern U.S.

Bellaire manages its long-term liabilities related to former Eastern U.S.

underground mining activities.

During the second quarter of 2025, we updated the names of our reportable segments to make it easier for our stakeholders to understand the business models within each segment.

During 2025, we changed the names of our reportable segments to make it easier for our stakeholders to understand the business activities within each segment.

The Utility Coal Mining, Contract Mining and Minerals and Royalties segments were formerly the Coal Mining, North American Mining and Minerals Management segments, respectively.

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Government Regulation Update:

There have been no material changes to the Government Regulation previously disclosed on pages 9 through 17 in our Annual Report on Form 10-K for the year ended December 31, 2024, except as follows:

There have been no material changes to the Government Regulation Update previously disclosed on pages 9 through 17 in our Annual Report on Form 10-K for the year ended December 31, 2024, except as follows:

The Environmental Protection Agency (EPA)

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In June 2025, the EPA announced plans to repeal regulations on power plants (Clean Power Plan 2.0) and Mercury and Air Toxics Standards (MATS).

Litigation over the previously adopted Clean Power Plan 2.0 and MATS rules continues to be held in abeyance while the EPA conducts new rulemaking to repeal the rules.

In May 2025, the EPA granted an administrative petition for reconsideration of the portion of the Clean Air Act’s regional haze rule which disapproved North Dakota's state implementation plan.

The EPA is required to submit status reports every 120 days, with the first report due October 2, 2025.

The EPA is required to submit status reports every 120 days and submitted its first status report on September 30, 2025.

This case continues to be held in abeyance while the EPA reconsiders the rule.

In May 2025, the EPA proposed to approve North Dakota’s CCR program application, which would allow the state, rather than the federal government, to manage coal ash disposal in surface impoundments and landfills.

In March 2025, the Trump Administration announced that the EPA will undertake historic actions of deregulation, as discussed above, but also including:

Since March 2025, the Trump Administration announced that the EPA will undertake historic actions of deregulation, as discussed above, but also including:

• Reconsideration of regulations on the oil and gas industry;

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• Reconsideration of the Risk Management Program rule;

• Reconsideration of the 2009 Endangerment Finding and regulations and actions that rely on that Finding;

• Rescinding the 2009 Carbon Dioxide Endangerment Finding and regulations and actions that rely on that Finding;

• Reconsideration of Particulate Matter National Ambient Air Quality Standards;

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We enter into leases of federally owned coal for a small portion of the coal mined at certain of our North Dakota mines.

These lease applications require review under the National Environmental Policy Act (NEPA).

The Department of Interior’s Bureau of Land Management (BLM) conducted the NEPA process for almost five years on two federal coal lease applications with no published Environmental Assessments.

In April 2025 and June 2025, respectively, the BLM published the draft Environmental Assessments for the lease applications in the Federal Register subject to a 30-day public comment period for the April publication and a 15-day public comment period for the June publication.

In October 2025, the Company's two federal coal lease applications were issued by the Department of Interior’s Bureau of Land Management.

Other Regulations

2 unchanged sentences

tax law including provisions for bonus depreciation, current expensing of research expenditures and changes to the interest deductibility threshold.

The changes resulting from the tax provisions in OBBBA are not expected to have a material impact on our results of operations.

The changes resulting from the tax provisions in OBBBA did not have a material impact on our results of operations.

The OBBBA includes substantial changes to U.S.

solar energy tax policy which could have a material impact on the solar projects being developed by ReGen Resources.

Our investments in solar and other energy projects are dependent, in part, upon current state regulatory incentives and federal tax credits in order for the projects to be economically viable.

Our investments in solar projects are dependent, in part, upon current state regulatory incentives and federal tax credits in order for the projects to be economically viable.

To mitigate the impacts of evolving regulations, we are focused on safe-harboring certain projects by establishing the beginning of construction through physical work of a significant nature to retain federal investment tax credits.

We have approximately $7.2 million of capitalized assets associated with our solar projects.

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CONSOLIDATED FINANCIAL SUMMARY

Our results of operations were as follows for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

Our results of operations were as follows for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

5 unchanged sentences

Total revenue $ 76,614 $ 61,656 $ 210,420 $ 167,290

Operating (loss) profit:

Operating profit (loss):

Utility Coal Mining $ 4,987 $ 19,938 $ 10,000 $ 22,288

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Eliminations (36) (41) (17) (21)

Total operating (loss) profit (51) 7,366 7,631 12,123

Total operating profit

6,777 19,699 14,408 31,822

Interest expense 1,087 1,386 4,805 3,808

6 unchanged sentences

Other, net 247 244 767 160

Other (income) expense, net

Other expense, net

820 567 1,330 889

6 unchanged sentences

The components of the change in revenues and operating profit are discussed below in Segment Results.

Second Quarter of 2025 Compared with Second Quarter of 2024, and First Six Months Ended June 30, 2025 Compared with First Six Months Ended June 30, 2024

Other (income) expense, net

Interest expense increased in the second quarter of 2025 and the first six months of 2025 compared with the respective 2024 periods due to higher average borrowings, partially offset by lower average interest rates.

Interest income decreased in the second quarter of 2025 and the first six months of 2025 compared with the respective 2024 periods due to lower earnings on reduced invested cash balances.

Third Quarter of 2025 Compared with Third Quarter of 2024, and First Nine Months Ended September 30, 2025 Compared with First Nine Months Ended September 30, 2024

Other expense, net

Interest expense decreased in the third quarter of 2025 compared with the respective 2024 period due to an increase in capitalized interest as well as lower average interest rates.

Interest expense increased in the first nine months of 2025 compared with the respective 2024 period due to higher average borrowings, partially offset by an increase in capitalized interest and lower average interest rates.

Interest income decreased in the third quarter of 2025 and the first nine months of 2025 compared with the respective 2024 periods due to lower earnings on reduced invested cash balances.

(Gain) loss on equity securities represents changes in the market price of invested assets reported at fair value.

The change in the second quarter of 2025 and the first six months of 2025 compared with the respective 2024 periods was due to fluctuations in the market prices of the exchange-traded equity securities.

The change in the third quarter of 2025 and the first nine months of 2025 compared with the respective 2024 periods was due to fluctuations in the market prices of the exchange-traded equity securities.

See Note 5 to the Unaudited Condensed Consolidated Financial Statements for further discussion of equity securities.

During the first quarter of 2025, $14.5 million of excess funds from the terminated Falkirk pension plan were directly transferred to the NACCO 401(k) plan.

During the first nine months of 2025, $14.5 million of excess funds from the terminated Falkirk pension plan were directly transferred to the NACCO 401(k) plan.

The NACCO 401(k) plan is a qualified replacement plan;

therefore, these funds will be utilized to offset future profit sharing contributions to 401(k) plan participants.

During the second quarter of 2025, NACCO and

Falkirk’s former customer agreed to settle the corresponding liability for $10.9 million, resulting in a $3.6 million Gain on settlement of excess funding liability.

therefore, these funds will be

utilized to offset future profit sharing contributions to 401(k) plan participants.

During the first nine months of 2025, NACCO and Falkirk’s former customer agreed to settle the corresponding liability for $10.9 million, resulting in a $3.6 million Gain on settlement of excess funding liability.

We evaluate and update our estimated annual effective income tax rate on a quarterly basis based on current and forecasted operating results and tax laws.

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The benefit of percentage depletion is not directly related to the amount of consolidated pre-tax income recorded in a period.

Accordingly, in periods where income before tax is relatively small, the proportional effect of the benefit from percentage depletion on the effective tax rate may be significant.

This contributed to the income tax benefit recorded for the three and six months ended June 30, 2025.

Accordingly, as a result of the reduction in 2025 income before income tax compared with 2024, the proportional effect of the benefit from percentage depletion on the effective income tax rate results in a negative forecasted effective tax rate for 2025.

This contributed to the income tax benefit recorded for the three and nine months ended September 30, 2025.

Each quarter, we update our estimate of the annual effective tax rate, and the cumulative impact of the change in the estimated annual tax rate is recorded, which can make quarterly comparisons not meaningful.

LIQUIDITY AND CAPITAL RESOURCES OF NACCO

The following tables detail the changes in cash flow for the six months ended June 30:

The following tables detail the changes in cash flow for the nine months ended September 30:

2025 2024 Change

Operating activities:

Net cash used for operating activities $ (2,753) $ (5,698) $ 2,945

Net cash provided by (used for) operating activities

$ 39,502 $ (2,879) $ 42,381

Investing activities:

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Cash flow before financing activities $ 6,692 $ (33,934) $ 40,626

The $2.9 million change in net cash used for operating activities was primarily due to a favorable change in non-cash items.

The Company’s non-cash items primarily include Gain on sale of assets, deferred income taxes, depreciation, depletion and amortization and stock-based compensation.

The $42.4 million change in net cash provided by (used for) operating activities was primarily due to a favorable change in the adjustments to reconcile net income to net cash provided by operating activities.

The Company’s adjustments primarily include the business interruption insurance recoveries at MLMC in 2024, Gain on sale of assets, deferred income taxes, depreciation, depletion and amortization and stock-based compensation.

A change in operating assets and liabilities also contributed to the increase in net cash provided by (used for) operating activities.

Accounts receivable decreased during the current-year period due to the timing of collections, whereas accounts receivable was comparable in the prior periods.

Inventory levels at September 30, 2025 are relatively consistent with year-end balances, whereas inventories increased during 2024.

These favorable items were partially offset by an unfavorable change in accrued expenses, mainly attributable to a decrease in accrued payroll during the 2025 period, whereas accrued payroll was comparable in prior periods.

2025 2024 Change

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Net cash (used for) provided by financing activities $ (26,868) $ 11,877 $ (38,745)

The change in net cash (used for) provided by financing activities was primarily due to reductions in debt borrowings during the first six months of 2025 compared with additions during the first six months of 2024, partially offset by a decrease in share repurchases during the first six months of 2025.

The change in net cash (used for) provided by financing activities was primarily due to reductions in debt borrowings during the first nine months of 2025 compared with additions during the first nine months of 2024, partially offset by a decrease in share repurchases during the first nine months of 2025.

Financing Activities

In September 2024, NACCO Natural Resources amended its secured revolving line of credit (Facility) to increase the revolving credit commitments to $200.0 million and extend the maturity to September 2028.

Borrowings outstanding under the Facility were $65.0 million at June 30, 2025.

At June 30, 2025, the excess availability under the Facility was $90.5 million, which reflects a reduction for outstanding letters of credit of $44.5 million.

Borrowings outstanding under the Facility were $50.0 million at September 30, 2025.

At September 30, 2025, the excess availability under the Facility was $99.3 million, which reflects a reduction for outstanding letters of credit of $50.7 million.

NACCO has not guaranteed any borrowings of NACCO Natural Resources.

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Borrowings bear interest at a floating rate plus a margin based on the level of debt to EBITDA ratio achieved.

The applicable margins, effective June 30, 2025, for base rate and Term Secured Overnight Financing Rate loans were 1.75% and 2.75%, respectively.

The applicable margins, effective September 30, 2025, for base rate and Term Secured Overnight Financing Rate loans were 1.50% and 2.50%, respectively.

The Facility has a commitment fee which is based upon achieving various levels of debt to EBITDA ratios.

The commitment fee was 0.45% on the unused commitment at June 30, 2025.

During the three and six months ended June 30, 2025, the average borrowing under the Facility was $66.0 million and $62.7 million, respectively, and the weighted-average annual interest rate was 7.05% and 7.00%, respectively.

The commitment fee was 0.40% on the unused commitment at September 30, 2025.

During the three and nine months ended September 30, 2025, the average borrowing under the Facility was $47.1 million and $57.5 million, respectively, and the weighted-average annual interest rate was 8.53% and 7.41%, respectively.

The Facility contains restrictive covenants, which require, among other things, NACCO Natural Resources to maintain a maximum net debt to EBITDA ratio of 2.75 to 1.00 and an interest coverage ratio of not less than 4.00 to 1.00.

The Facility provides the ability to make loans, dividends and advances to NACCO, with some restrictions based on maintaining a maximum debt to EBITDA ratio of 1.50 to 1.00, or if greater than 1.50 to 1.00, a Fixed Charge Coverage Ratio of 1.10 to 1.00.

At June 30, 2025, NACCO Natural Resources was in compliance with all financial covenants in the Facility.

At September 30, 2025, NACCO Natural Resources was in compliance with all financial covenants in the Facility.

The obligations under the Facility are guaranteed by certain of NACCO Natural Resources' direct and indirect, existing and future domestic subsidiaries, and is secured by certain assets of NACCO Natural Resources and the guarantors, subject to customary exceptions and limitations.

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Expenditures for property, plant and equipment and mineral interests

Expenditures for property, plant and equipment were $12.0 million during the first six months of 2025, primarily for equipment in the Contract Mining segment.

Expenditures for property, plant and equipment were $34.3 million during the first nine months of 2025, primarily for a dragline and dragline related repairs in the Contract Mining segment.

Planned expenditures for the remainder of 2025 are expected to be approximately $44 million.

This amount includes $7 million in the Utility Coal Mining segment, $19 million in the Contract Mining segment, $16 million in the Minerals and Royalties segment and $2 million in growth businesses included in Unallocated Items.

Planned expenditures in 2026 are expected to be approximately $70 million.

Expenditures are expected to be funded from internally generated funds and/or bank borrowings.

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Debt to total capitalization 16% 20% (4)%

The increase in other net tangible assets at June 30, 2025 compared with December 31, 2024 was mainly the result of:

• An increase in Prepaid insurance due to the timing of payments;

• A decrease in Accrued payroll for payments made during the first six months of 2025 related to our incentive compensation plans;

• An increase in Deposits with vendors.

These changes were partially offset by a decrease in Trade accounts receivable during the first six months of 2025 due to the timing of payments.

The increase in other net tangible assets at September 30, 2025 compared with December 31, 2024 was mainly the result of increases in Property, plant and equipment and tax assets.

These increases were partially offset by a decrease in Trade accounts receivable during the first nine months of 2025 primarily due to the timing of payments.

Contractual Obligations, Contingent Liabilities and Commitments

Since December 31, 2024, other than the changes identified above, there have been no significant changes in the total amount of NACCO's contractual obligations, contingent liabilities or commercial commitments, or the timing of cash flows in accordance with those obligations as reported on pages 56 and 57 in our Annual Report on Form 10-K for the year ended

December 31, 2024.

See Note 6 to the Unaudited Condensed Consolidated Financial Statements for a discussion of certain guarantees related to Coyote Creek.

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FINANCIAL REVIEW

Tons of coal delivered by the Utility Coal Mining segment were as follows for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

Tons of coal delivered by the Utility Coal Mining segment were as follows for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

2 unchanged sentences

Total tons delivered 6,078 5,809 16,911 17,097

The results of operations for the Utility Coal Mining segment were as follows for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

The results of operations for the Utility Coal Mining segment were as follows for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

4 unchanged sentences

14,311 13,821 40,430 37,834

Business interruption insurance recoveries — 13,612 — 13,612

Selling, general and administrative expenses 7,317 7,014 23,070 21,984

Amortization of intangible assets 167 131 574 373

Gain on sale of assets (14) (79) (86) (89)

(Gain) loss on sale of assets

(17) 2 (103) (87)

Operating profit $ 4,987 $ 19,938 $ 10,000 $ 22,288

(a) See Note 6 to the Unaudited Condensed Consolidated Financial Statements for a discussion of our unconsolidated subsidiaries.

Second Quarter of 2025 Compared with Second Quarter of 2024

Revenues increased 90.9% in the second quarter of 2025 compared with the second quarter of 2024 primarily due to an increase in customer requirements at MLMC.

Third Quarter of 2025 Compared with Third Quarter of 2024

Revenues increased 11.0% in the third quarter of 2025 compared with the third quarter of 2024 primarily due to an increase in customer requirements at MLMC.

A boiler issue at the customer's Red Hills Power Plant reduced customer requirements in 2024.

The following table identifies the components of change in Operating profit for the second quarter of 2025 compared with the second quarter of 2024:

The following table identifies the components of change in Operating profit for the third quarter of 2025 compared with the third quarter of 2024:

Operating Profit

2024 $ 19,938

Increase (decrease) from:

Business interruption insurance recoveries in 2024

Gross loss (1,509)

Selling, general and administrative expenses (303)

Earnings of unconsolidated operations (350)

Amortization of intangibles (36)

Earnings of unconsolidated operations 490

Net change on sale of assets 19

Operating profit decreased by $1.5 million in the second quarter of 2025 compared with the second quarter of 2024, primarily due to an increase in gross loss, higher selling, general and administrative expenses and a decrease in earnings of unconsolidated operations.

Gross loss was unfavorable at MLMC during the second quarter of 2025 compared with the 2024 period.

Although the cost per ton delivered improved during the second quarter of 2025, the contractual sales price per ton decreased.

In addition, the number of tons sold exceeded tons mined resulting in the recognition of costs previously capitalized into inventory.

In comparison,

during the second quarter of 2024, inefficiencies at the customer's power plant created mining inefficiencies, and thus higher mining costs.

The tons mined exceeded tons sold resulting in a portion of production costs being capitalized into inventory during the 2024 period.

Operating profit decreased by $15.0 million in the third quarter of 2025 compared with the 2024 period.

This decrease was primarily due to the absence of MLMC's business interruption insurance recoveries for the boiler issue at the Red Hills Power Plant, an increase in gross loss and higher selling, general and administrative expenses.

These unfavorable changes were partially offset by an increase in earnings of unconsolidated operations.

Gross loss was unfavorable at MLMC during the third quarter of 2025 compared with the 2024 period, primarily due to a decrease in the contractual sales price per ton.

The increase in selling, general and administrative expenses was mainly the result of higher employee-related costs.

The decrease in earnings of unconsolidated operations was primarily due to lower customer demand at Coteau, Coyote and Falkirk, partially offset by higher per ton management fees, mainly the result of temporary price concessions ending at Falkirk in June 2024.

First Six Months of 2025 Compared with First Six Months of 2024

Revenues increased 56.7% in the first six months of 2025 compared with the first six months of 2024 primarily due to an increase in customer requirements at MLMC.

The increase in earnings of unconsolidated operations was primarily due to a higher per ton management fee at Coteau as well as an increase in customer demand and a higher per ton management fee at Falkirk.

First Nine Months of 2025 Compared with First Nine Months of 2024

Revenues increased 39.9% in the first nine months of 2025 compared with the first nine months of 2024 primarily due to an increase in customer requirements at MLMC.

A boiler issue at the customer's Red Hills Power Plant reduced customer requirements in 2024.

The following table identifies the components of change in Operating profit for the first six months of 2025 compared with the first six months of 2024:

The following table identifies the components of change in Operating profit for the first nine months of 2025 compared with the first nine months of 2024:

Operating Profit

2024 $ 22,288

Increase (decrease) from:

Earnings of unconsolidated operations 2,106

Gross loss 1,508

Business interruption insurance recoveries in 2024

Selling, general and administrative expenses (1,086)

Amortization of intangibles (201)

Gross loss (1)

Earnings of unconsolidated operations 2,596

Net change on sale of assets 16

Operating profit increased by $2.7 million in the first six months of 2025 compared with the first six months of 2024 primarily due to an increase in earnings of unconsolidated operations and a decrease in gross loss.

These improvements were partially offset by higher selling, general and administrative expenses.

The increase in earnings of unconsolidated operations was primarily due to higher per ton management fees, mainly the result of temporary price concessions ending at Falkirk in June 2024, partially offset by lower customer demand at Coteau, Coyote and Falkirk.

The improvement in gross loss at MLMC was primarily due to a reduction in the cost per ton delivered during the first six months of 2025 compared with the 2024 period.

The reduction in cost per ton delivered was primarily attributable to an increase in the tons sold at MLMC in the first six months of 2025 due to the resolution of the boiler issue that impacted the customer's Red Hills Power Plant during 2024.

2025 $ 10,000

Operating profit decreased by $12.3 million in the first nine months of 2025 compared with the 2024 period.

This decrease was primarily due to the absence of MLMC's business interruption insurance recoveries for the boiler issue at the Red Hills Power Plant and higher selling, general and administrative expenses.

These unfavorable changes were partially offset by an increase in earnings of unconsolidated operations.

The increase in selling, general and administrative expenses was mainly the result of higher employee-related costs.

CONTRACT MINING SEGMENT

FINANCIAL REVIEW

Tons delivered by the Contract Mining segment were as follows for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

Tons delivered by the Contract Mining segment were as follows for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

Total tons delivered 14,385 12,005 41,185 43,178

The results of operations for the Contract Mining segment were as follows for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

The results of operations for the Contract Mining segment were as follows for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

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Gain on sale of assets (2) (300) (2) (302)

Operating profit $ 1,010 $ 3,085 $ 2,980 $ 5,440

Operating profit (loss)

$ 1,929 $ (474) $ 4,909 $ 4,966

(a) See Note 6 to the Unaudited Condensed Consolidated Financial Statements for a discussion of our unconsolidated subsidiaries.

Second Quarter of 2025 Compared with Second Quarter of 2024

Total revenues increased in the second quarter of 2025 compared with the second quarter of 2024, primarily due to an increase in reimbursable costs, which have an offsetting amount in cost of sales and have no impact on gross profit.

Revenues excluding reimbursable costs increased 2.9% in the second quarter of 2025 compared with the 2024 period, as an increase in part sales was partially offset by fewer tons delivered due to reduced customer requirements, in part due to operational delays at several quarries.

The following table identifies the components of change in Operating profit for the second quarter of 2025 compared with the second quarter of 2024:

Operating Profit

Third Quarter of 2025 Compared with Third Quarter of 2024

Total revenues increased in the third quarter of 2025 compared with the third quarter of 2024, primarily due to an increase in reimbursable costs, which have an offsetting amount in cost of sales and have no impact on gross profit.

Revenues excluding reimbursable costs increased 21.6% in the third quarter of 2025 compared with the 2024 period, mainly the result of more tons delivered due to higher customer requirements and an increase in part sales.

The increase in tons delivered is partially due to an increase in planned customer outages and significant rain events in Florida during the third quarter of 2024 that did not recur in the 2025 period.

The following table identifies the components of change in Operating profit (loss) for the third quarter of 2025 compared with the third quarter of 2024:

Operating Profit (Loss)

Increase (decrease) from:

1 unchanged sentence

Selling, general and administrative expenses 480

Net change on sale of assets

Earnings of unconsolidated operations (48)

Gain on sale of assets (1)

Operating profit decreased $2.1 million in the second quarter of 2025 compared with the second quarter of 2024.

The change in Operating profit was primarily due to a decrease in gross profit, an increase in selling, general and administrative expenses and a decrease in earnings of unconsolidated operations.

The reduction in gross profit was mainly the result of a decrease in tons delivered and higher operating costs, including unexpected equipment repairs and maintenance costs, partially offset by an increase in part sales.

The increase in selling, general and administrative expenses was mainly the result of higher employee-related costs.

The decrease in earnings of unconsolidated operations was primarily due to a reduction in tons delivered.

First Six Months of 2025 Compared with First Six Months of 2024

Total revenues increased in the first six months of 2025 compared with the first six months of 2024, primarily due to an increase in reimbursable costs, which have an offsetting amount in cost of sales and have no impact on gross profit.

Revenues excluding reimbursable costs increased 3.0% in the first six months of 2025 compared with the 2024 period, as an increase in part sales was partially offset by fewer tons delivered due to reduced customer requirements, in part due to operational delays at several quarries.

The following table identifies the components of change in Operating profit for the first six months of 2025 compared with the first six months of 2024:

Operating profit (loss) improved by $2.4 million in the third quarter of 2025 compared with the 2024 period.

The favorable change was primarily due to an increase in gross profit and a decrease in selling, general and administrative expenses.

The improvement in gross profit was mainly the result of an increase in tons delivered and improved margins at the consolidated limestone quarries.

The decrease in selling, general and administrative expenses was the result of the absence of a $0.9 million charge to establish an allowance against a customer receivable.

First Nine Months of 2025 Compared with First Nine Months of 2024

Total revenues increased in the first nine months of 2025 compared with the first nine months of 2024, primarily due to an increase in reimbursable costs, which have an offsetting amount in cost of sales and have no impact on gross profit.

Revenues excluding reimbursable costs increased 8.7% in the first nine months of 2025 compared with the 2024 period primarily due to an increase in part sales.

The following table identifies the components of change in Operating profit for the first nine months of 2025 compared with the first nine months of 2024:

Operating Profit

2 unchanged sentences

Earnings of unconsolidated operations (660)

Net change on sale of assets

Selling, general and administrative expenses (100)

Gain on sale of assets (2)

Operating profit decreased $2.5 million in the first six months of 2025 compared with the first six months of 2024.

The change in Operating profit was primarily due to a decrease in gross profit, a decrease in earnings of unconsolidated operations and an increase in selling, general and administrative expenses.

The reduction in gross profit was mainly the result of a decrease in tons delivered and higher operating costs, including unexpected repairs and maintenance costs, partially offset by an increase in part sales.

Operating profit in the first nine months of 2025 was comparable to the 2024 period.

An increase in gross profit was largely offset by a decrease in earnings of unconsolidated operations.

The improvement in gross profit was mainly the result of an increase in part sales, partially offset by a decrease in tons delivered and higher operating costs, including unexpected repairs and maintenance costs.

The decrease in earnings of unconsolidated operations was primarily due to a reduction in tons delivered.

The increase in selling, general and administrative expenses was mainly the result of higher employee-related costs.

MINERALS AND ROYALTIES SEGMENT

1 unchanged sentence

The following table sets forth our estimate of the number of gross and net productive wells:

June 30, 2025 June 30, 2024

September 30, 2025 September 30, 2024

Gross Net Gross Net

4 unchanged sentences

Oil and natural gas prices have been historically volatile and may continue to be volatile in the future.

The table below demonstrates such volatility and shows the average prices as reported by the United States Energy Information Administration for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

The table below demonstrates such volatility and shows the average prices as reported by the United States Energy Information Administration for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

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We do not have information that would be available to a company with working interests in oil and natural gas operations because detailed information is not generally available to owners of royalty and mineral interests.

The results of operations for the Minerals and Royalties segment were as follows for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

The results of operations for the Minerals and Royalties segment were as follows for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

12 unchanged sentences

Operating profit $ 7,968 $ 6,188 $ 21,080 $ 21,709

Revenues increased 29.9% and 13.6% in the second quarter and the first six months of 2025, respectively, compared with the 2024 periods, primarily due to an increase in natural gas revenue as a result of higher natural gas prices, partially offset by decreased production volumes.

The following table identifies the components of change in Operating profit for the second quarter of 2025 compared with the second quarter of 2024:

Revenues increased 5.2% and 10.6% in the third quarter and the first nine months of 2025, respectively, compared with the 2024 periods, primarily due to an increase in natural gas revenue as a result of higher natural gas prices, partially offset by a decrease in oil revenue as a result of lower oil prices.

The following table identifies the components of change in Operating profit for the third quarter of 2025 compared with the third quarter of 2024:

Operating Profit

Increase (decrease) from:

Gain on sale of assets

Selling, general and administrative expenses (177)

Gross profit 2,190

Earnings of unconsolidated operations 898

The following table identifies the components of change in Operating profit for the first six months of 2025 compared with the first six months of 2024:

Gross profit 629

Selling, general and administrative expenses 253

Operating profit increased by $1.8 million in the third quarter of 2025 compared with the 2024 period, primarily due to improvements in earnings of unconsolidated operations and gross profit.

The increase in earnings of unconsolidated operations was primarily related to an additional investment in Eiger Resources during the fourth quarter of 2024.

The increase in gross profit was mainly due to higher natural gas prices.

The following table identifies the components of change in Operating profit for the first nine months of 2025 compared with the first nine months of 2024:

Operating Profit

6 unchanged sentences

2025 $ 21,080

Operating profit decreased $2.4 million in both the second quarter and the first six months of 2025 compared with 2024 periods, primarily due to the absence of a $4.5 million prior year gain on sale of land.

These decreases were partially offset by improvements in gross profit due to higher natural gas prices.

Operating profit decreased by $0.6 million in the first nine months of 2025 compared with the 2024 period, primarily due to the absence of a $4.5 million prior year gain on sale of land.

This decrease was partially offset by improvements in gross profit and earnings of unconsolidated operations.

The increase in gross profit was mainly due to higher natural gas prices.

The increase in earnings of unconsolidated operations was primarily related to an additional investment in Eiger Resources during the fourth quarter of 2024.

UNALLOCATED ITEMS AND ELIMINATIONS

FINANCIAL REVIEW

Unallocated Items and Eliminations were as follows for the three and six months ended June 30:

THREE MONTHS SIX MONTHS

Unallocated Items and Eliminations were as follows for the three and nine months ended September 30:

THREE MONTHS NINE MONTHS

2025 2024 2025 2024

Operating loss $ (8,107) $ (5,953) $ (21,581) $ (17,141)

The operating loss increased in the second quarter and first six months of 2025 compared to the 2024 periods primarily due to higher employee-related and outside service costs.

The increase in outside services is mainly attributable to developing businesses.

The operating loss increased in the third quarter and first nine months of 2025 compared to the 2024 periods primarily due to higher employee-related costs and increased costs related to our business development projects.

Employee-related costs increased primarily due to elevated medical costs and higher share based incentive compensation expense as a result of an increase in our share price during 2025.

NACCO Industries, Inc.

NACCO is a growing diversified natural resource company, strategically positioned to deliver consistent financial returns.

NACCO is a growing diversified natural resource company, strategically positioned to deliver consistent financial returns over the long term.

Our businesses operate exclusively in the U.S.

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Our platform is supported by multiple vectors for value creation, and we are steadfastly committed to delivering compounding returns and expanding investor value over the long term.

While the current quarter presented some unexpected operational challenges, our business model is purposely built for durability and resilience.

Our business model is purposely built for durability and resilience.

Our foundation rests on a stable base of long-term coal-mining contracts, generating dependable recurring cash flows.

1 unchanged sentence

This, combined with income generated by our mineral and royalty assets, provide cash flow stability.

We remain confident in our ability to deliver improving results during the second half of 2025, with momentum building as we move into 2026.

Over the remainder of the year, we anticipate a substantial increase in consolidated operating profit compared to the first half, although full-year results will be lower than the prior year due in part to $13.6 million of business interruption insurance income recognized in the third quarter of 2024.

We remain confident in our ability to deliver sound fourth-quarter 2025 operating results, with momentum building as we move into 2026.

We anticipate consolidated operating profit for the 2025 fourth-quarter to be comparable to the prior year quarter.

Full-year operating profit will be lower than 2024 due in part to the 2025 second-quarter break-even results.

In addition, we intend to terminate our defined benefit pension plan in the fourth quarter of 2025.

Although the plan is currently over funded, a significant non-cash settlement charge is anticipated upon termination.

The pension settlement charge and lower operating profit are expected to lead to a substantial year-over-year decrease in net income and EBITDA compared with the 2024 second half and full year.

Our Utility Coal Mining segment, operated by North American Coal, constitutes the foundation of our business, anchored by a stable portfolio of long-term mining contracts.

We anticipate customer demand to remain steady in the second half of 2025 and throughout 2026 at the unconsolidated mining operations.

At MLMC, results for the 2025 second half are expected to improve over the first half of 2025.

However, a reduction in the 2025 contractually determined per ton sales price compared with 2024 is anticipated to continue to offset expected improvements in cost efficiencies, causing MLMC's and the Utility Coal Mining segment's 2025 second half and full year results to decline from the respective prior year levels, which include the business interruption insurance income.

Looking ahead, we expect improving profitability for this segment in 2026, driven by continued stable earnings at our unconsolidated operations and anticipated improvements at MLMC in both sales price and cost per ton delivered, particularly if the customer's power plant is able to operate more consistently.

The Contract Mining segment, operated by North American Mining, represents our mining growth platform, benefiting from ongoing geographic and mineral expansion and the signing of new, more favorable long-term contracts.

Each new contract perpetuates the compounding effect that underpins our growth strategy—much like building an annuity portfolio over time.

For example, in 2024, the Contract Mining segment executed three new or amended contracts, which are projected to generate approximately $20 million in after-tax net present value cash flows over contract terms ranging from 6 to 20 years.

The pension settlement charge and lower operating profit are expected to lead to a substantial year-over-year decrease in net income and EBITDA compared with the 2024 fourth quarter and full year.

We expect meaningful year-over-year improvements in both operating profit and net income in 2026.

Our Utility Coal Mining segment, operated by North American Coal, constitutes the foundation of our business, anchored by our long-term mining contracts.

We anticipate steady customer demand for the remainder of 2025 and in 2026 at the

unconsolidated mining operations.

At MLMC, fourth-quarter 2025 results are expected to improve over 2024 due to operational efficiencies.

However, this improvement is not expected to offset the effect of the reduction in the 2025 contractually determined per ton sales price, causing MLMC's and the Utility Coal Mining segment's 2025 full-year results to decline compared with 2024.

Looking ahead, we expect improving profitability for this segment in 2026, driven by anticipated improvements at MLMC in both sales price and cost per ton delivered, particularly if the customer's power plant is able to operate more consistently.

The Contract Mining segment, operated by North American Mining, represents our mining growth platform.

Our expanding pipeline of potential deals and continued engagement with customers position this segment as a key pillar for future growth.

Sawtooth, a North American Mining subsidiary, is the exclusive provider of comprehensive mining services at Thacker Pass, which is owned through a joint venture between Lithium Americas Corp.

Through ongoing geographic and mineral expansion, we are building a growing portfolio of long-term contracts.

As an example, North American Mining executed a multi-year contract in October 2025 to provide dragline services as part of a project to construct an embankment dam in Palm Beach County, Florida.

This project should be accretive to earnings beginning in the second quarter of 2026.

Sawtooth, a North American Mining subsidiary, is the exclusive provider of comprehensive mining services at Thacker Pass, which is owned by a joint venture between Lithium Americas Corp.

LAC) and General Motors Holdings LLC.

Sawtooth will supply all of the lithium-bearing ore requirements for Thacker Pass, which is currently under

construction.

Department of Energy also holds warrants to purchase five percent non-voting, non-transferable equity in this joint venture.

Sawtooth will supply all of the lithium-bearing ore requirements for our customer's Thacker Pass lithium processing facility, which is currently under construction.

This project is currently providing stable income during the construction phase and will contribute enhanced income and long-term cash flows once lithium production commences.

Phase 1 lithium production is estimated to begin in late 2027.

Near term, while overall customer demand within the Contract Mining segment is expected to remain stable year-over-year, profitability improvements in the 2025 second half and full year are expected to be driven by operational efficiencies and an increased focus on parts sales.

This momentum is expected to continue into 2026.

While overall customer demand within the Contract Mining segment is expected to increase year-over-year, profitability improvements in the 2025 fourth quarter are expected to be driven by operational efficiencies partly offset by elevated operating expenses.

Momentum from the strong full-year 2025 results and operational efficiencies is expected to accelerate in 2026.

These factors, combined with earnings from the new contract signed in October 2025 are expected to lead to a significant increase in year-over-year results.

The Minerals and Royalties segment, led by Catapult, has constructed a high-quality, diversified portfolio of oil and gas mineral and royalty interests in the United States.

The business is a scalable platform for growth, with its data-driven approach to portfolio expansion and disciplined capital deployment providing a distinct competitive advantage in the U.S.

In July 2025, Catapult completed a $4.2 million acquisition of mineral interests within the Midland Basin which included 10,500 gross acres and approximately 400 net royalty acres.

The Catapult team is expanding its portfolio by leveraging a data-driven approach to capital deployment that incorporates a longer-term view of production and development.

We believe this provides a competitive advantage in the U.S.

Minerals and Royalties' operating profit and Segment Adjusted EBITDA for the 2025 fourth quarter are expected to decrease compared with 2024 primarily driven by current market expectations for natural gas and oil prices, as well as development and production assumptions on currently owned reserves.

While fourth-quarter 2025 results are projected to decline, full-year operating profit is expected to increase over 2024, excluding the $4.5 million gain on sale recognized in the 2024 second quarter.

This increase is due in part to recent investments made by Catapult.

In July 2025, Catapult completed a $4.2 million acquisition of mineral interests within the Midland Basin.

The acquisition includes a mix of producing wells, as well as additional upside opportunities through future development with existing operators in the area.

This business also has an investment in a company that holds non-operated working interests in oil and natural gas assets.

These investments are expected to contribute to the anticipated improvement in second-half operating profit compared with both the first half of 2025 and second half of 2024.

Improvements in operating profit are expected to continue into 2026.

This segment also has an investment in a company that holds non-operated working interests in oil and natural gas assets.

While these investments are expected to contribute to 2026 profits, reductions in earnings from legacy assets are expected to mostly offset these improvements resulting in a modest operating profit increase compared with 2025.

Mitigation Resources provides stream and wetland mitigation solutions, as well as comprehensive reclamation and restoration construction services.

Mitigation Resources, underpinned by a strong reputation and clear competitive strengths, is an avenue for continued expansion into new markets.

This business, while currently variable in performance due to permit and project timing, is expected to achieve key milestones in profitability in 2026 and move toward more consistent results over time as new projects are layered on top of existing projects.

Mitigation Resources has a strong reputation and clear competitive strengths, which are supporting continued expansion into new markets.

This business, while currently variable in performance due to permit and project timing, is expected to achieve a key milestone in profitability in 2026 and move toward more consistent results over time as the business expands.

We continue to invest in our businesses to drive future growth.

Based on the current project pipeline, we anticipate capital expenditures of up to a total of $86 million in 2025, with the majority earmarked for future business development— the kind of prudent reinvestment that generates exponential, long-term value creation.

We project a substantially lower use of cash for the 2025 full year compared with 2024 as we begin to harvest returns from prior investments and expect a steady increase in annual cash flow generation beginning in 2026.

Our conservative approach to maintaining a strong capital structure and operating discipline minimizes risk, while the compounding effect of layered long-term contracts and deliberate growth investments create a robust foundation for cash flow growth.

Based on the current project pipeline, we anticipate capital expenditures of approximately $44 million in the remainder of 2025, and up to $70 million in 2026, with the majority earmarked for future business development — the kind of prudent reinvestment that is expected to generate significant long-term value creation.

As we begin to harvest returns from prior investments, we project a substantial improvement in full-year 2025 cash provided by operations.

This improvement is expected to be offset by anticipated capital investments, resulting in a lower use of cash before financing compared with 2024.

In 2026, we expect a use of cash before financing comparable to 2025.

Our conservative approach to maintaining a strong capital structure and operating discipline minimizes risk, while the compounding effect of a growing portfolio of long-term contracts and deliberate growth investments create a robust foundation for cash flow growth.

With a perspective that spans decades, we are methodically building a strong, stable business that is expected to deliver annuity-like returns.

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the availability and cost of transportation and processing services in the areas where the Company's oil and gas reserves are located;

chain disruptions, including price increases and shortages of parts and materials, inclusive of tariff effects, (10) failure to obtain adequate insurance coverages at reasonable rates, (11) changes in tax laws or regulatory requirements, including the elimination of, or reduction in, the percentage depletion tax deduction, changes in mining or power plant emission regulations and health, safety or environmental legislation, (12) impairment charges, (13) changes in costs related to geological and geotechnical conditions, repairs and maintenance, new equipment and replacement parts, fuel or other similar items, (14) equipment problems that could affect deliveries to customers, (15) changes in the costs to reclaim mining areas, (16) costs to pursue and develop new mining, mitigation, oil and gas and power generation development opportunities and other value-added service opportunities, (17) the ability to successfully evaluate investments and achieve intended financial results in new business and growth initiatives, (18) disruptions from natural or human causes, including severe weather, accidents, fires, earthquakes and terrorist acts, any of which could result in suspension of operations or harm to people or the environment, and (19) the ability to attract, retain, and replace workforce and administrative employees.

and the ability of lessees to obtain capital or financing needed for well-development operations and leasing and development of oil and gas reserves on federal lands, (7) any customer's premature facility closure or extended project development delay, (8) federal and state legislative and regulatory actions affecting fossil fuels, (9) supply chain disruptions, including price increases and shortages of parts and materials, inclusive of tariff effects, (10) failure to obtain adequate insurance coverages at reasonable rates, (11) changes in tax laws or regulatory requirements, including the elimination of, or reduction in, the percentage depletion tax deduction, changes in mining or power plant emission regulations and health, safety or environmental legislation, (12) impairment charges, (13) changes in costs related to geological and geotechnical conditions, repairs and maintenance, new equipment and replacement parts, fuel or other similar items, (14) equipment problems that could affect deliveries to customers, (15) changes in the costs to reclaim mining areas, (16) costs to pursue and develop new mining, mitigation, oil and gas and power generation development opportunities and other value-added service opportunities, (17) the ability to successfully evaluate investments and achieve intended financial results in new business and growth initiatives, (18) disruptions from natural or human causes, including severe weather, accidents, fires, earthquakes and terrorist acts, any of which could result in suspension of operations or harm to people or the environment, and (19) the ability to attract, retain, and replace workforce and administrative employees.

Quantitative and Qualitative Disclosures About Market Risk

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What changed 10-Q

Item 1. Financial Statements