Alliance Resource Partners, L.P. Q1 FY2026 earnings call

• First quarter results higher than expected due to record BOE volumes and higher commodity prices. - Coal operations had weather-related shipment delays. - Evaluating Metiki's future with uncertainty. - Royalty segments had strong results. - Balance sheet strong with total debt $507.7M, liquidity $431.2M. - Completed Riverview to Henderson County minor unit transition. - Market themes: Coal's role in grid reliability, Iran conflict impact on export market, longer-term structural support for coal-fired generation, policy developments supporting coal-fired generation. - Oil and gas royalty segment had record quarter with growth in volumes and acquisitions.

For the 2026 quarter, Adjusted EBITDA was $155 million. Total revenues were $516 million. Coal operations: Tons produced on target but weather caused ~200,000 tons delay. Illinois Basin: Sales volumes 6.1M tons, price $51.05/ton, segment-adjusted EBITDA expense per ton $35.20. Appalachia: Sales volumes 1.8M tons, price $74.51/ton, segment-adjusted EBITDA expense per ton $62.19. Royalty segments: Total royalty revenues $61.2M, oil and gas royalty revenues $41.3M with record BOE volumes $1M, coal royalty segment $12.3M.

• Maintaining overall guidance ranges for coal sales volumes, price, and segment-adjusted EBITDA expense per ton. - 2026 expected coal sales volumes more than 95% committed. - Increasing oil and gas royalty segment volume guidance by ~5% on BOE basis. - Expecting better operational visibility in second half of 2026.

• Weather-related disruptions can cause shipment delays. - Uncertainty regarding Metiki's future operations. - Commodity price fluctuations can impact revenues. - Regulatory and market uncertainties affecting coal-fired generation and royalty segments.

Q: Joe, on Iran conflict and export market, API 2 price range, A: Currently domestic preferred, API 2 around $120, possible future export opportunities.

Q: Customer demand into summer, A: Customers evaluating, summer weather likely drive spot activity, forecasts predict warmer summer.

Q: PJM power shortage, A: PJM discussing ensuring capacity, existing coal plants likely to stay open.

Q: Appalachia costs, A: Long wall move done, costs to come down in second half.

Q: Capital allocation, A: Continuing to look at oil and gas, interested in power plant divestments.

Q: Capital allocation criteria, A: Hurdle rates and criteria vary by area, oil and gas return 15 - 20%+, coal investment shorter payback.

Q: Digital assets, A: Believes Bitcoin has upside due to regulations and market trends.

Q: Second half strength, A: Second quarter transition, second half stronger with Hamilton coming online.

Q: CapEx, A: Included coal reserve purchases, normalize out.

Q: Outside coal purchases, A: No additional expected.

Q: Other income, A: Favorable actuarial and Infinitum adjustments, not regular.

Q: Stock buyback and dividend, A: Focus on capital allocation, need distribution coverage ratio in line first.