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Equipment failures or deterioration of assets, may lead to production curtailments, shutdowns, impairments, or additional expenditures, which could have a material adverse effect on our results of operations and financial condition.
−Removed: Factors beyond our control could disrupt our cokemaking and logistics operations, adversely affect our ability to service the needs of our customers and increase our operating costs, all of which could have a material and adverse effect on
−Removed: our results of operations.
+Added: Factors beyond our control could disrupt our cokemaking and logistics operations, adversely affect our ability to service the needs of our customers and increase our operating costs, all of which could have a material and adverse effect on our results of operations.
Adverse developments at our cokemaking facilities could significantly disrupt our ability to produce and supply coke, steam, and/or electricity to our customers.
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Substantially all of our coke sales currently are made pursuant to long-term contracts with Cliffs Steel and U.S.
−Removed: We expect these customers to continue to account for a significant portion of our revenues for the foreseeable future.
+Added: We expect these customers, and/or their respective successors in interest, by operation of merger, or otherwise, to continue to account for a significant portion of our revenues for the foreseeable future.
We are subject to the credit risk of our major customers and other parties.
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The loss of any of these customers (or financial difficulties at any of these customers, which result in nonpayment or nonperformance) could have a significant adverse effect on our business.
−Removed: If one or more of these customers were to significantly reduce its purchases of coke or logistics services from us without a make-whole payment, or default on their agreements with us, or terminate or fail to renew their agreements with us, or if we were unable to sell such coke or logistics
−Removed: services to these customers on terms as favorable to us as the terms under our current agreements, our cash flows, financial position, permit compliance, or results of operations could be materially and adversely affected.
+Added: If one or more of these customers were to significantly reduce its purchases of coke or logistics services from us without a make-whole payment, or default on their agreements with us, or terminate or fail to renew their agreements with us, or if we were unable to sell such coke or logistics services to these customers on terms as favorable to us as the terms under our current agreements, our cash flows, financial position, permit compliance, or results of operations could be materially and adversely affected.
+Added: Impairment in the carrying value of long-lived assets could adversely affect our business, financial condition and results of operations.
+Added: We have a significant amount of long-lived assets on our Consolidated Balance Sheets.
+Added: Under generally accepted accounting principles, long-lived assets must be reviewed for impairment whenever adverse events or changes in circumstances indicate a possible impairment.
+Added: We are required to perform impairment tests on our assets whenever events or changes in circumstances lead to a reduction of the estimated useful life or estimated future cash flows that would indicate that the carrying amount may not be recoverable or whenever management’s plans change with respect to those assets.
+Added: If business conditions or other factors cause profitability and cash flows to decline, we may be required to record non-cash impairment charges.
+Added: Events and conditions that could result in impairment in the value of our long-lived assets include:
+Added: the impact of a downturn in the global economy, competition, advances in technology, adverse changes in the regulatory environment, new contracts and/or modification, termination or non-renewal of existing contracts, and other factors leading to a reduction in expected long-term sales or profitability, or a significant decline in the trading price of our common stock or market capitalization, lower future cash flows, slower industry growth rates and other changes in the industries in which we or our customers operate.
We face competition, both in our cokemaking operations and in our logistics business, which has the potential to reduce demand for our products and services, and that could have an adverse effect on our financial condition and results of operations.
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Many steelmakers also are exploring alternatives to blast furnace technology that require less or no use of coke or alternatives that reduce the amount of GHG emissions from the process.
−Removed: For example, electric arc furnace technology is a commercially proven process widely used in the United States.
+Added: For example, electric arc furnace technology is a commercially proven process widely used in the U.S.
As these alternative processes for production of steel become more widespread, the demand for blast furnace coke, including the coke we produce, may be significantly reduced.
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• Logistics business :
−Removed: Decreased throughput and utilization of our logistics assets could result indirectly due to competition in the electrical power generation business from abundant and relatively inexpensive supplies of natural gas displacing thermal coal as a fuel for electrical power generation by utility companies.
+Added: Decreased throughput and utilization of our logistics assets could result indirectly due to competition in the electrical power generation business from abundant and relatively inexpensive supplies of
+Added: natural gas displacing thermal coal as a fuel for electrical power generation by utility companies.
In addition, competition in the steel industry from processes such as electric arc furnaces, or blast furnace injection of pulverized coal or natural gas, may reduce the demand for metallurgical coals processed through our logistics facilities.
−Removed: In the future, additional coal handling facilities and terminals with rail and/or barge access may be constructed in the Eastern United States.
+Added: In the future, additional coal handling facilities and terminals with rail and/or barge access may be constructed in the Eastern U.S.
Such additional facilities could compete directly with us in specific markets now served by our logistics business.
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In addition, these requirements are complex, change frequently and have become more stringent over time.
−Removed: Regulatory requirements, including those related to GHGs, and various CAA programs, may change in the future in a manner that could result in substantially increased capital, operating and compliance costs, which could have a material adverse effect on our business, financial condition and results of operations.
+Added: Regulatory requirements, including those related to GHGs, and various CAA programs, may change in the future in a manner that could result in substantially increased capital, operating and compliance costs, which could have an adverse effect on our financial condition and results of operations.
Failure to comply with applicable laws, regulations or permits may result in the assessment of administrative, civil and criminal penalties, the imposition of cleanup and site restoration costs and liens, the issuance of injunctions to limit or cease operations, the suspension or revocation of permits and other enforcement measures that could cause delays in permitting or development of projects or materially limit, or increase the cost of, our operations.
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We have in the past and could in the future be subject to claims under federal, state and local laws and regulations arising from these activities, including for the investigation and clean-up of soil, surface water, or groundwater.
+Added: Some environmental laws also can impose liability regardless of fault or legality at the time in question, including the characterization of materials.
We previously have been and could again in the future be subject to litigation for alleged bodily injuries or property damage arising from claimed exposure to emissions or hazardous substances allegedly used, released, or disposed of by us, as well as litigation related to climate change by governments, private entities, or individuals.
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The permitting rules, and the interpretations of these rules, are complex, change frequently, and are often subject to discretionary interpretations by our regulators, all of which may make compliance more costly, difficult or impractical, and may possibly preclude the continuance of ongoing operations or the development of future cokemaking and/or logistics facilities.
−Removed: Non-governmental organizations, environmental groups and individuals have certain rights to engage in the permitting process, and may comment upon, or object to, the requested permits.
+Added: Non-governmental organizations, environmental groups and individuals have certain rights to engage in the permitting process, and may
+Added: comment upon, or object to, the requested permits.
Such persons also have the right to bring citizen’s lawsuits to challenge the issuance of permits, or the validity of environmental impact statements related thereto.
−Removed: If any permits or leases are not issued or renewed in a timely fashion or at all, or if permits issued or renewed are conditioned in a manner that restricts our ability to efficiently and economically conduct our operations, our cash flows or profitability could be materially and adversely affected.
+Added: If any permits or leases are not issued or renewed in a timely fashion or at all, or if permits issued or renewed are conditioned in a manner that restricts our ability to efficiently and economically conduct our operations, it could have an adverse effect on our financial condition and results of operations.
Our businesses are subject to inherent risks, some for which we maintain third party insurance and some for which we self-insure.
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The success of our future acquisitions and/or investments will depend substantially on the accuracy of our analysis concerning such businesses and our ability to complete such acquisitions or investments on favorable terms, as well as to finance such acquisitions or investments and to integrate the acquired operations successfully with existing operations.
−Removed: Risks associated with acquisitions include the diversion of management’s attention from other business concerns, the
−Removed: potential loss of key employees and customers of the acquired business, the possible assumption of unknown liabilities, potential disputes with the sellers, and the inherent risks in entering markets or lines of business in which we have limited or no prior experience.
+Added: Risks associated with acquisitions include the diversion of management’s attention from other business concerns, the potential loss of key employees and customers of the acquired business, the possible assumption of unknown liabilities, potential disputes with the sellers, and the inherent risks in entering markets or lines of business in which we have limited or no prior experience.
Antitrust and other laws may prevent us from completing acquisitions.
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and impairment charges.
−Removed: Impairment in the carrying value of long-lived assets could adversely affect our business, financial condition and results of operations.
−Removed: We have a significant amount of long-lived assets on our Consolidated Balance Sheets.
−Removed: Under generally accepted accounting principles, long-lived assets must be reviewed for impairment whenever adverse events or changes in circumstances indicate a possible impairment.
−Removed: We are required to perform impairment tests on our assets whenever events or changes in circumstances lead to a reduction of the estimated useful life or estimated future cash flows that would indicate that the carrying amount may not be recoverable or whenever management’s plans change with respect to those assets.
−Removed: If business conditions or other factors cause profitability and cash flows to decline, we may be required to record non-cash impairment charges.
−Removed: Events and conditions that could result in impairment in the value of our long-lived assets include:
−Removed: the impact of a downturn in the global economy, competition, advances in technology, adverse changes in the regulatory environment, and other factors leading to a reduction in expected long-term sales or profitability, or a significant decline in the trading price of our common stock or market capitalization, lower future cash flows, slower industry growth rates and other changes in the industries in which we or our customers operate.
Our operating results have been and may continue to be affected by fluctuations in our costs of production, and, if we cannot pass increases in our costs of production to our customers, our financial condition, results of operations and cash flows may be negatively affected.
Our operations require a reliable supply of equipment, replacement parts and metallurgical coal.
−Removed: If the cost to produce coke and provide logistics services, including cost of supplies, equipment, metallurgical coal or labor, experience significant price inflation and we cannot pass such increases in our costs of production to our customers, our profit margins may be reduced and our financial condition, results of operations and cash flows may be adversely affected.
+Added: If the cost to produce coke and provide logistics services increases due to price or usage, including cost of supplies, equipment, metallurgical coal or labor, and we cannot pass such increases in our costs of production to our customers, our profit margins may be reduced and our financial condition, results of operations and cash flows may be adversely affected.
We may incur costs and liabilities resulting from claims for damages to property or injury to persons arising from our operations, and such costs and liabilities could have a material and adverse effect on our financial condition or results of operations.
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There is increasing regulatory attention concerning the issue of climate change and the impact of GHGs, particularly from fossil fuels, which are integral to our cokemaking and logistics businesses.
−Removed: Our business and operations, as well as the business and operations of our key suppliers and customers, may become subject to legislation or regulation intended to limit GHG emissions, the use of fossil fuels or the effects of climate change, or may be impacted by the increasing drive towards a lower carbon economy in an effort to limit the impacts of climate change.
+Added: Our business and operations, as well as the business and operations of our key suppliers and customers, may become subject to legislation or regulation intended to limit GHG emissions or the use of fossil fuels.
It is not possible to foresee the details of such legislation or regulations or changes in the economy or their resulting effects on our business.
−Removed: Because our coking process is dependent on coal as a raw material and the coking process generates carbon dioxide, we are limited in our ability to reduce our GHG emissions and could be affected by future regulation of GHGs, although we are evaluating the feasibility of reducing our GHG emissions profile.
−Removed: Any new regulations, legislation or taxes that affect other industries that use coal or other fossil fuels processed through our terminals could reduce throughput and utilization of our logistics assets.
−Removed: Future legislation or regulation regarding climate change and GHG emissions could impose significant costs on our business and our customers and suppliers due to increased energy, capital equipment, emissions controls, environmental monitoring and reporting and other costs in order to comply with these laws and regulations.
−Removed: Failure to comply with these regulations could result in fines to our company and could affect our business, financial condition and results of operations.
−Removed: Additionally, our suppliers may face cost increases to comply with any new legislation or regulations leading to higher costs to us for goods or services.
+Added: Because our coking process is dependent on coal as a raw material and the coking process generates carbon dioxide, we are limited in our ability to reduce our GHG emissions and could be affected by future regulation of GHGs.
+Added: Future legislation or regulation regarding climate change and GHG emissions could have a material adverse effect on our financial condition and results of operations.
Climate change may cause changes in weather patterns and increase the frequency or severity of weather events and flooding.
−Removed: An increase in severe weather events and flooding may adversely impact us, our operations, and our ability to procure raw materials and manufacture and transport our products and could result in an adverse effect on our business, financial condition and results of operations.
+Added: An increase in severe weather events and flooding may adversely impact us, our operations, and our ability to procure raw materials and manufacture and transport our products which could have a material adverse effect on our financial condition and results of operations.
Extreme weather conditions may increase our costs, temporarily impact our production capabilities or cause damage to our facilities.
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Additionally, extreme cold could prevent coal delivery and unloading at our coke plants, impeding operation, or create a more hazardous outdoor working environment for our employees .
−Removed: Severe weather may also adversely impact our suppliers and our customers and their ability to purchase and transport our products.
Investor interest in climate change, fossil fuels, and sustainability could adversely affect our business and our stock price.
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Members of the investment community are also increasing their focus on sustainability practices, including management of GHGs and climate change.
+Added: To the extent ESG matters impact our reputation, they may also impact our ability to attract or retain employees or customers.
As a result, we may face increasing pressure regarding our sustainability disclosures and practices.
+Added: While we have in the past engaged, and expect in the future to continue to engage, in voluntary initiatives (such as voluntary disclosures, certifications, or goals, among others) on “ESG matters”, such as sustainability and inclusion, to respond to stakeholder expectations, such initiatives may be costly and may not have the desired effect.
+Added: For example, actions or statements that we may take based on expectations, assumptions, or third-party information may at some point be
+Added: determined to be erroneous or otherwise not in keeping with best practices.
+Added: If we fail to, or are perceived to fail to, appropriately advance certain initiatives or use appropriate methodologies and data sources, we may be subject to various adverse impacts, including reputational damage, stakeholder engagement, and/or litigation.
+Added: Simultaneously, there are efforts by some parties, including some policymakers and activists, to constrain or eliminate companies' efforts on various ESG-related matters.
+Added: To the extent we are subject to any such activism, it may require us to incur costs or otherwise adversely impact our business.
+Added: Many of our customers, business partners, and suppliers may be subject to similar expectations, which may augment or create additional risks, including risks that may not be known to us.
Risks Related to Our Cokemaking Business
−Removed: If a substantial portion of our agreements to supply coke, electricity, and/or steam are modified or terminated, our cash flows, financial position, permit compliance or results of operations may be adversely affected if we are not able to replace such agreements, or if we are not able to enter into new agreements at the same level of profitability.
+Added: If a substantial portion of our agreements to supply coke, electricity, and/or steam are modified or terminated, our cash flows, financial position, permit compliance, results of operations and/or carrying value of our long-lived assets may be adversely affected if we are not able to replace such agreements, or if we are not able to enter into new agreements at the same level of profitability.
We make substantially all of our coke, electricity and steam sales under long-term agreements.
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In addition, contractual provisions for adjustment or renegotiation of prices and other provisions may increase our exposure to short-term price volatility.
−Removed: From time to time, we discuss the extension of existing agreements and enter into new long-term agreements for the supply of coke, steam, and energy to our customers, but these negotiations may not be successful and these customers may
−Removed: not continue to purchase coke, steam, or electricity from us under long-term agreements.
+Added: From time to time, we discuss the extension of existing agreements and enter into new long-term agreements for the supply of coke, steam, and energy to our customers, but these negotiations may not be successful and these customers may not continue to purchase coke, steam, or electricity from us under long-term agreements.
In addition, declarations of bankruptcy by customers can result in changes in our contracts with less favorable terms.
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In addition, future increases in exports of coke from China and/or other coke-producing countries also may reduce our customers' demand for coke capacity.
−Removed: Such reduced demand for our coke could adversely affect the certainty of our long-term relationships with our customers, depress coke prices, and limit our ability to enter into new, or renew existing, commercial arrangements with our customers, as well as our ability to sell excess capacity in the spot market, and could materially and adversely affect our future revenues and profitability.
+Added: Such reduced demand for our coke could adversely affect the certainty of our long-term relationships with our customers, depress coke prices, and limit our ability to enter into new, or renew existing, commercial arrangements with our customers, as well as our ability to sell into the North American spot coke and export coke markets, and could materially and adversely affect our future revenues and profitability.
Certain provisions in our long-term coke agreements may result in economic penalties to us, or may result in termination of our coke sales agreements for failure to meet minimum volume requirements, coal-to-coke yields or other required specifications, and certain provisions in these agreements and our energy sales agreements may permit our customers to suspend performance.
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If our coke fails to meet such specifications, we could be subject to significant contractual damages or contract terminations, and our sales could be negatively affected.
−Removed: The quality of our coke depends significantly on the effectiveness of our quality control systems, which, in turn, depends on a number of factors, including the design of our quality control systems, our quality-training program, our laboratories and our
−Removed: ability to ensure that our employees adhere to our quality control policies and guidelines.
+Added: The quality of our coke depends significantly on the effectiveness of our quality control systems, which, in turn, depends on a number of factors, including the design of our quality control systems, our quality-training program, our laboratories and our ability to ensure that our employees adhere to our quality control policies and guidelines.
Any significant failure or deterioration of our quality control systems could have a material adverse effect on our results of operations.
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Substantially all of the metallurgical coal used to produce coke at our cokemaking facilities is purchased from third-parties under one-year contracts.
−Removed: We cannot assure that there will continue to be an ample supply of metallurgical coal available or that these facilities will be supplied without any significant disruption in coke production, as economic, environmental, and other conditions outside of our control may reduce our ability to source sufficient amounts of coal for our forecasted operational needs.
+Added: We cannot assure that there will continue to be an ample supply of metallurgical coal available that meet our quality specifications or that these facilities will be supplied without any significant disruption in coke production, as economic, environmental, and other conditions outside of our control may reduce our ability to source sufficient amounts of coal for our forecasted operational needs.
If we are not able to make up the shortfalls resulting from such supply failures through purchases of coal from other sources, the failure of our coal suppliers to meet their supply commitments could materially and adversely impact our results of operations and, ultimately, impact the structural integrity of our coke oven batteries.
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Alternative transportation and delivery systems are generally inadequate and not suitable to handle the quantity of our shipments or to ensure timely delivery.
−Removed: The loss of access to rail capacity could create temporary disruption until the access is restored, significantly impairing our ability to receive coal and resulting in materially decreased revenues.
+Added: The loss of access to rail capacity could create temporary disruption until the access is restored, significantly impairing our ability to receive coal and resulting in materially decreased
Our ability to open new cokemaking facilities may also be affected by the availability and cost of rail or other transportation systems available for servicing these facilities.
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Furthermore, the claims in patents that have been issued to us or our subsidiaries or that may be issued to us in the future may not be sufficiently broad to prevent third parties from using cokemaking technologies and heat recovery processes similar to ours.
−Removed: In addition, the laws of various foreign countries in which we plan to compete may not protect our intellectual property to the same extent as do the laws of the United States.
+Added: In addition, the laws of various foreign countries in which we plan to compete may not protect our intellectual property to the same extent as do the laws of the U.S.
If we fail to obtain adequate patent protection for our proprietary technology, our ability to be commercially competitive may be materially impaired.
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These revenues depend on continuing operations and, in some cases, certain minimum production levels being achieved at the Vitória cokemaking facility.
−Removed: In the past, the Brazilian economy has been
−Removed: characterized by frequent and occasionally extensive intervention by the Brazilian government and unstable economic cycles.
+Added: In the past, the Brazilian economy has been characterized by frequent and occasionally extensive intervention by the Brazilian government and unstable economic cycles.
The Brazilian government has changed in the past, and may change monetary, taxation, credit, tariff and other policies to influence Brazil’s economy in the future.
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If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, we may be required to delay or reduce the scope of our business strategy.
−Removed: We face material debt maturities which may adversely affect our consolidated financial position.
−Removed: Over the next five years, we have $43.8 million of total consolidated debt maturing.
−Removed: See Note 11 to the consolidated financial statements.
+Added: We may face material debt maturities which may adversely affect our consolidated financial position.
+Added: As of December 31, 2023, we have no consolidated debt maturing over the next five years.
+Added: See Note 11 to our consolidated financial statements.
+Added: However, we may enter into debt agreements throughout the course of the fiscal year which could create material debt maturities.
We may not be able to refinance this debt, or may be forced to do so on terms substantially less favorable than our currently outstanding debt.
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Our ability to meet our debt obligations and reduce our level of indebtedness depends upon our future performance and general economic, financial, business, and other factors, many of which are beyond our control.
−Removed: Factors affecting our ability to raise cash through an offering of our common stock or a refinancing of our debt include financial market conditions, the value of our assets, and our performance at the time we need capital.
+Added: Factors affecting our
+Added: ability to raise cash through an offering of our common stock or a refinancing of our debt include financial market conditions, the value of our assets, and our performance at the time we need capital.
In addition, the credit agreement governing our credit facilities contains restrictive covenants that limit our ability to engage in activities (such as incurring additional debt) that may be in our long-term best interest.
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General Risks
−Removed: The COVID-19 pandemic has in the past and may continue to adversely impact or disrupt our, and our customers’ and suppliers’, business, operations, cash flows, financial condition and results of operations.
−Removed: Any future outbreak of COVID-19 variants or any other highly infectious or contagious disease could have a similar impact.
−Removed: The COVID-19 pandemic had, and may continue to have, adverse impacts on our business.
−Removed: While our facilities continued to operate during the COVID-19 pandemic due to our inclusion in the Critical Manufacturing Sector as defined by the U.S.
−Removed: Department of Homeland Security, COVID-19 negatively impacted our business and results of operations primarily due to the impacts of the COVID-19 pandemic on our customers and suppliers.
−Removed: For example, certain of our steelmaking and logistics customers were adversely impacted by the idling of manufacturing plants as a result of the COVID-19 pandemic.
−Removed: In an effort to assist certain of our steelmaking customers impacted by the COVID-19 pandemic, we implemented volume relief measures by providing near-term coke supply relief for such customers in exchange for extending of certain contracts.
−Removed: The extent to which COVID-19 or other future pandemics impact our business and results of operations, and our customers' and suppliers' business and results of operations, are out of our control and will depend on future developments that are highly uncertain and cannot be predicted, including rising inflation and supply chain issues, the emergence of new variants, the severity and duration of the pandemic and actions taken to contain it or mitigate its effects, as well as the effectiveness of vaccine rollout plans, the public's perception of the safety of the vaccines and their willingness to take the vaccines, public safety measures and the impact of the pandemic on the global economy.
−Removed: Therefore, the impact of COVID-19, including any
−Removed: resurgences of the virus, new variants, or other similar future health crises may heighten other risks discussed herein, which could adversely impact or disrupt our business, financial condition, results of operations, cash flows and market value.
Sustained uncertainty in financial markets, or unfavorable economic conditions in the industries in which our customers operate, may lead to a reduction in the demand for our products and services, and adversely impact our cash flows, financial position or results of operations.
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Our systems could be damaged or interrupted by a security breach, terrorist attack, fire, flood, power loss, telecommunications failure or similar event.
−Removed: disaster recovery plans may not entirely prevent delays or other complications that could arise from an information systems failure.
+Added: Our disaster recovery plans may not entirely prevent delays or other complications that could arise from an information systems failure.
Our business interruption insurance may not compensate us adequately for losses that may occur.
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It is also possible under certain legislation that if we acquire a company that has violated or is not in compliance with applicable data protection laws, we may incur significant liabilities and penalties as a result.
−Removed: Unresolved Staff Comments
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.