- Company reports record $1.3 million of net income and $5.7 million of adjusted EBITDA
- Launch of American Metal LLC subsidiary enables Company to generate additional revenue utilizing many of its existing resources
- Well-positioned to be a long-term supplier of raw material to the global infrastructure market while bringing a more efficient and modernized business model to the industry
- Strategic steps taken to transform Company into infrastructure company producing pure metallurgical carbon and metal aggregation, while enhancing environmental, social and governance (ESG) profile
- Company expects multiple value driving milestones over the course of 2020
FISHERS, INDIANA / ACCESSWIRE / July 24, 2020 / American Resources Corporation (NASDAQ:AREC) ("American Resources" or the "Company"), a supplier of raw materials to the rapidly growing global infrastructure marketplace, today reported its second quarter of 2020 financial results and provided a corporate update.
Mark Jensen, Chairman and CEO of American Resources Corporation commented, "Over the course of the second quarter our team continued to execute on the strategic transformation of the Company to become a more diversified infrastructure company. In tandem, we made significant progress in advancing our efforts to better our industry-leading position as a stable, long-term and low-cost supplier of metallurgical carbon. Additionally, we were able to further demonstrate our ability to innovate and adapt by generating high-margin revenue from our recently established American Metals LLC subsidiary, which further diversifies our business model, while continuing to divest and monetize non-core assets."
Second Quarter 2020 Key Highlights
- Divested certain non-core assets in eastern Kentucky to further reduce the Company's overall cost structure and environmental liabilities (asset retirement obligations) from its balance sheet and enhance the flexibility of its focused supply base in anticipation of worldwide infrastructure related demand.
- Added a third, and subsequently have added a fourth environmental reclamation crew during the COVID-19 pandemic to expand its environmental remediation efforts to repair decommissioned and irrational thermal coal mining sites that are at or below the Company's proprietary (economic and environmental) margin to reduce the Company's long-term cost structure and maintain a safe working environment for employees.
- Launched metal aggregation and processing subsidiary, American Metals to aggregate and process steel to be recycled in traditional and electric arc furnaces to produce new recycled steel. American Metals is working in conjunction with its expanded environmental remediation efforts primarily sourcing used steel from decommissioned coal mining operations and associated activities in the region. American Metals further demonstrates the Company's ability to adapt and diversify its business as a leading supplier of raw materials to the growing global infrastructure market.
Mr. Jensen continued, "Looking forward to the remainder of 2020 and into the coming years, we remain quite optimistic on global infrastructure demand and believe governments around the world will continue to look to increase infrastructure projects as a way to stimulate economic activity as we recover from the ongoing COVID-19 pandemic. With the assets that we own today and the actions we have taken, we feel that we are in a great position to be a meaningful and growing supplier of raw materials to fulfill a portion of that demand. We believe the achievements we have made at our Perry County Resources complex have set it up to be one of the lowest, if not the lowest, PCI operations in the country that has production capabilities of over 1.0 million tons per year. We will continue to grow American Metals to provide used steel to be recycled and sold to traditional and electric arc furnace steel production facilities to further diversify our business in a meaningful way, and to advance and support our environmental efforts. Additionally, our McCoy Elkhorn complex is prepared to be brought back online as market conditions improve, and we are looking forward to advancing our Wyoming County complex towards production next year as a low-cost, premium mid-vol carbon complex.
"Lastly, and as we've previously stated, we believe our ESG efforts will further distinguish American Resources as industry revolutionaries. The partnerships we have made will accelerate our goals to permanently shut down and remediate irrational thermal coal operation throughout our region and find creative ways to contribute to the advancement of social and environmental issues facing this region," added Mr. Jensen.
Financial Results for Second Quarter 2020
For the second quarter of 2020, American Resources reported net income of $1.3 million, or $0.05 per share for the three months ended June 30, 2020, as compared with a net loss of $8.96 million, or a loss of $0.38 per share, in the prior-year period. The Company earned adjusted earnings before interest, taxes, depreciation, amortization, equity-based compensation, warrant expense and development and restructuring costs ("Adjusted EBITDA") of $5.7 million in the first quarter of 2020, as compared with Adjusted EBITDA of $1.8 million for the first quarter of 2019.
Second Quarter 2020 Summary
Total revenues were $226,836 for the second quarter of 2020. Cost of sales (includes mining, transportation, royalty, holding and processing costs) for the second quarter of 2020 were $662,556, or 292 percent of total revenues, compared to $5.65 million, or 60 percent of total revenue in the same period of 2019.
General and administrative expenses for the second quarter of 2020 were $684,307, or ­­302 percent of total revenue, compared to $990,918 during the second quarter of 2019. Depreciation for the second quarter of 2020 was $293,746, or 129 percent of total revenue. American Resources incurred interest expense of $1.01 million during the second quarter of 2020 compared to $447,989 during the second quarter of 2019. Development costs during the quarter were $307,247, compared to $128,159 in the first quarter of 2020.
The Company did not incur any income tax expense in the first quarter of 2020 as it was able to utilize its available net operating losses ("NOL") carried forward from prior periods of approximately $13,746,391 as of December 31, 2019.
Operational Results
During the second quarter of 2020, all carbon production was idled due to the disruptions related to the global COVID-19 pandemic. As previously stated, the Company instead shifted its primary focus on increasing efficiencies, reducing its long-term cost structure, monetizing non-core assets and advancing environmental reclamation.
Mr. Jensen reiterated, "During the COVID-19 outbreak, our first priority was to ensure the safety of our workers; thereafter, we wanted to strategically utilize this time to increase efficiencies at our operations for the long-term and are incredibly proud of the progress made on that front. We believe producing carbon at a loss is a horrible idea, however it is an unavoidable practice for some producers in our industry because of their significant fixed holding costs. Enabled by our low corporate overhead and our dedication to not waste valuable resources, we chose to focus on improving mine plans and advancing environmental reclamation during this market disruption, which we believe will drive significant long-term value for our shareholders as we look to be in position to ramp up production when the market stabilizes."
The exhibit below summarizes some of the key sales, production and financial metrics:
|
|
|
Three month
ended |
|
|
Three month ended |
|
|
|
|
June 30, |
|
|
March 31, |
|
|
June 30, |
|
|
|
|
2020 |
|
|
2020 |
|
|
2019 |
|
|
Sales Volume (a)
|
|
|
|
|
|
|
|
|
|
|
Tons Sold
|
|
|
- |
|
|
|
6,568 |
|
|
|
127,021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company Production (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
McCoy Elkhorn Coal
|
|
|
- |
|
|
|
- |
|
|
|
56,335 |
|
|
Perry County Resources
|
|
|
- |
|
|
|
6,568 |
|
|
|
- |
|
|
Deane Mining
|
|
|
- |
|
|
|
- |
|
|
|
70,686 |
|
|
Total
|
|
|
- |
|
|
|
6,568 |
|
|
|
127,021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company Financial Metrics(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue per Ton
|
|
|
- |
|
|
|
79.83 |
|
|
|
73.38 |
|
|
Cash Cost per Ton Sold (c)
|
|
|
- |
|
|
|
282.46 |
|
|
|
49.27 |
|
|
Cash Margin per Ton (c)
|
|
|
- |
|
|
|
(202.63 |
) |
|
|
24.11 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Development Costs
|
|
$ |
307,247 |
|
|
$ |
128,159 |
|
|
|
1,887,447 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
(a) In short tons
(b) Excludes transportation
(c) Cash cost per ton is based on reported cost of sales and includes items such as production taxes, royalties, labor, fuel, and other similar production and sales cost items, and may be adjusted for other items that, pursuant to GAAP, are classified in the Statement of Operations as costs other than cost of sales, but relate directly to the cost incurred to produce coal. Our cash cost of sales per short ton is calculated as cash cost of sales divided by short tons sold, and our cash margin per ton is calculated by subtracting cash cost per ton from revenue per ton. Cash cost of sales per short ton and average cash margin per ton are non-GAAP financial measure which are calculated in conformity with U.S. GAAP and should be considered supplemental to, and not as a substitute or superior to financial measures calculated in conformity with GAAP. We believe cash cost of sales per ton and average cash margin per ton are useful measurse of performance as it aides some investors and analysts in comparing us against other companies. Cash cost of sales per ton and margin per ton may not be comparable to similarly titled measures used by other companies.
AMERICAN RESOURCES CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
|
|
|
For the three months ended
June 30,
2020
|
|
|
For the three
months ended
June 30,
2019
|
|
|
For the six
months ended
June 30,
2020
|
|
|
For the six
months ended
June 30,
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Coal Sales
|
|
$ |
- |
|
|
$ |
9,321,250 |
|
|
$ |
524,334 |
|
|
$ |
16,315,526 |
|
|
Metal Aggregating, Processing and Sales
|
|
|
226,836 |
|
|
|
- |
|
|
|
226,836 |
|
|
|
- |
|
|
Processing Services Income
|
|
|
- |
|
|
|
20,876 |
|
|
|
- |
|
|
|
20,876 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue
|
|
|
226,836 |
|
|
|
9,342,126 |
|
|
|
751,170 |
|
|
|
16,336,402 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Coal Sales and Processing
|
|
|
(662,556 |
) |
|
|
(5,654,568 |
) |
|
|
(2,517,743 |
) |
|
|
(12,298,655 |
) |
|
Accretion Expense
|
|
|
(370,587 |
) |
|
|
(320,098 |
) |
|
|
(741,174 |
) |
|
|
(641,799 |
) |
|
Depreciation
|
|
|
(293,746 |
) |
|
|
(804,889 |
) |
|
|
(1,208,798 |
) |
|
|
(1,621,805 |
) |
|
Amortization of Mining Rights
|
|
|
(313,224 |
) |
|
|
(802,590 |
) |
|
|
(626,448 |
) |
|
|
(1,339,381 |
) |
|
General and Administrative
|
|
|
(684,307 |
) |
|
|
(990,918 |
) |
|
|
(1,527,231 |
) |
|
|
(2,363,506 |
) |
|
Professional Fees
|
|
|
(316,280 |
) |
|
|
(631,934 |
) |
|
|
(510,326 |
) |
|
|
(4,965,830 |
) |
|
Production Taxes and Royalties
|
|
|
(89,827 |
) |
|
|
(603,957 |
) |
|
|
(250,057 |
) |
|
|
(1,863,543 |
) |
|
Development Costs
|
|
|
(307,247 |
) |
|
|
(2,887,448 |
) |
|
|
(435,406 |
) |
|
|
(4,487,565 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses
|
|
|
(3,037,774 |
) |
|
|
(12,696,402 |
) |
|
|
(7,817,183 |
) |
|
|
(29,582,084 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss from Operations
|
|
|
(2,810,938 |
) |
|
|
(3,354,276 |
) |
|
|
(7,066,013 |
) |
|
|
(13,245,182 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income and (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income
|
|
|
(1,726,184 |
) |
|
|
214,529 |
|
|
|
(314,179 |
) |
|
|
480,954 |
|
|
Gain on Sale of Assets
|
|
|
6,820,949 |
|
|
|
- |
|
|
|
6,820,949 |
|
|
|
- |
|
|
Loss on settlement of payable
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(22,660 |
) |
|
Amortization of debt discount and issuance costs
|
|
|
(5,758 |
) |
|
|
(2,869,118 |
) |
|
|
(5,758 |
) |
|
|
(7,502,979 |
) |
|
Interest Income
|
|
|
41,171 |
|
|
|
41,172 |
|
|
|
123,514 |
|
|
|
82,343 |
|
|
Warrant Modification Expense
|
|
|
- |
|
|
|
(2,545,360 |
) |
|
|
- |
|
|
|
(2,545,360 |
) |
|
Interest expense
|
|
|
(1,011,003 |
) |
|
|
(447,989 |
) |
|
|
(1,511,643 |
) |
|
|
(772,843 |
) |
|
Total Other income (expense)
|
|
|
4,119,175 |
|
|
|
(5,606,766 |
) |
|
|
5,112,883 |
|
|
|
(10,280,545 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
|
|
$ |
1,308,237 |
|
|
$ |
(8,961,042 |
) |
|
$ |
(1,953,130 |
) |
|
$ |
(23,526,227 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share - basic and diluted
|
|
$ |
.05 |
|
|
$ |
(0.38 |
) |
|
$ |
(.07 |
) |
|
$ |
(1.07 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding
|
|
|
26,833,809 |
|
|
|
23,345,857 |
|
|
|
27,122,160 |
|
|
|
22,078,999 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMERICAN RESOURCES CORPORATION
CONSOLIDATED BALANCE SHEETS
UNAUDITED
|
|
|
June 30,
2020
|
|
|
December 31,
2019
|
|
| ASSETS |
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS
|
|
|
|
|
|
|
|
Cash
|
|
$ |
1,618,582 |
|
|
$ |
3,324 |
|
|
Accounts Receivable
|
|
|
37,400 |
|
|
|
2,424,905 |
|
|
Inventory
|
|
|
150,504 |
|
|
|
515,630 |
|
|
Prepaid fees
|
|
|
175,000 |
|
|
|
- |
|
|
Accounts Receivable - Other
|
|
|
234,240 |
|
|
|
234,240 |
|
|
Total Current Assets
|
|
|
2,215,726 |
|
|
|
3,178,099 |
|
|
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS
|
|
|
|
|
|
|
|
|
|
Cash - restricted
|
|
|
535,641 |
|
|
|
265,487 |
|
|
Processing and rail facility
|
|
|
12,554,715 |
|
|
|
12,723,163 |
|
|
Underground equipment
|
|
|
7,850,626 |
|
|
|
8,294,188 |
|
|
Surface equipment
|
|
|
3,136,906 |
|
|
|
3,224,896 |
|
|
Acquired mining rights
|
|
|
669,860 |
|
|
|
669,860 |
|
|
Coal refuse storage
|
|
|
12,171,271 |
|
|
|
12,171,271 |
|
|
Less Accumulated Depreciation
|
|
|
(12,715,725 |
) |
|
|
(11,162,622 |
) |
|
Land
|
|
|
1,748,169 |
|
|
|
1,748,169 |
|
|
Note Receivable
|
|
|
4,117,139 |
|
|
|
4,117,139 |
|
|
Total Other Assets
|
|
|
30,068,602 |
|
|
|
32,051,551 |
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$ |
32,284,328 |
|
|
$ |
35,229,650 |
|
|
|
|
|
|
|
|
|
|
|
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$ |
11,456,102 |
|
|
$ |
11,044,479 |
|
|
Accounts payable - related party
|
|
|
885,029 |
|
|
|
718,156 |
|
|
Accrued interest
|
|
|
1,197,050 |
|
|
|
2,869,763 |
|
|
Due to affiliate
|
|
|
74,000 |
|
|
|
132,000 |
|
|
Current portion of long term-debt (net of unamortized discount of $- and $134,296)
|
|
|
16,601,920 |
|
|
|
20,494,589 |
|
|
Current portion of convertible debt, (net of unamortized discount of $- and $-)
|
|
|
- |
|
|
|
7,419,612 |
|
|
Current portion of reclamation liability
|
|
|
2,327,169 |
|
|
|
2,327,169 |
|
|
Total Current Liabilities
|
|
|
32,541,270 |
|
|
|
45,006,407 |
|
|
|
|
|
|
|
|
|
|
|
|
OTHER LIABILITIES
|
|
|
|
|
|
|
|
|
|
Long-term portion of note payable (net of issuance costs of $422,941 and $428,699)
|
|
|
4,731,760 |
|
|
|
5,415,271 |
|
|
Convertible note payables - long term
|
|
|
14,517,371 |
|
|
|
- |
|
|
Reclamation liability
|
|
|
14,981,814 |
|
|
|
17,512,613 |
|
|
Total Other Liabilities
|
|
|
34,230,945 |
|
|
|
22,927,884 |
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
66,772,215 |
|
|
|
67,934,291 |
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
AREC - Class A Common stock: $.0001 par value; 230,000,000 shares authorized, 26,040,512 and 27,410,512 shares issued and outstanding
|
|
|
2,603 |
|
|
|
2,740 |
|
|
AREC - Series A Preferred stock: $.0001 par value; 5,000,000 shares authorized, 0 and 0 shares issued and outstanding
|
|
|
- |
|
|
|
- |
|
|
AREC - Series C Preferred stock: $.0001 par value; 20,000,000 shares authorized, 0 and 0 shares issued and outstanding
|
|
|
- |
|
|
|
- |
|
|
Additional paid-in capital
|
|
|
90,611,151 |
|
|
|
90,326,104 |
|
|
Accumulated deficit
|
|
|
(125,101,641 |
) |
|
|
(123,033,485 |
) |
|
Total Stockholders' Equity (Deficit)
|
|
|
(34,487,887 |
) |
|
|
(32,704,641 |
) |
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
|
|
$ |
32,284,328 |
|
|
$ |
35,229,650 |
|
|
|
|
|
|
|
|
|
|
AMERICAN RESOURCES CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
|
|
|
For the six
months ended
|
|
|
For the six
months ended
|
|
|
|
|
June 30,
2020
|
|
|
June 30,
2019
|
|
|
Cash Flows from Operating activities:
|
|
|
|
|
|
|
|
Net loss
|
|
$ |
(1,953,130 |
) |
|
$ |
(23,526,227 |
) |
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
1,208,798 |
|
|
|
1,621,805 |
|
|
Amortization of mining rights
|
|
|
626,448 |
|
|
|
1,339,381 |
|
|
Accretion expense
|
|
|
741,174 |
|
|
|
641,799 |
|
|
Liabilities reduced due to sale of assets
|
|
|
(3,271,973 |
) |
|
|
- |
|
|
Recovery of previously impaired accounts receivable
|
|
|
- |
|
|
|
(50,806 |
) |
|
Amortization of issuance costs and debt discount
|
|
|
- |
|
|
|
7,502,979 |
|
|
Warrant modification expense
|
|
|
- |
|
|
|
2,545,360 |
|
|
Stock option expense
|
|
|
142,296 |
|
|
|
142,296 |
|
|
Issuance of warrants in connection with convertible notes
|
|
|
1,223,700 |
|
|
|
- |
|
|
Issuance of shares for services
|
|
|
18,800 |
|
|
|
- |
|
|
Issuance of shares for debt settlement
|
|
|
642,060 |
|
|
|
- |
|
|
Warrant expense
|
|
|
87,754 |
|
|
|
2,524,500 |
|
|
Shares returned as part of asset sale
|
|
|
(1,840,200 |
) |
|
|
- |
|
|
Share compensation expense
|
|
|
- |
|
|
|
1,806,040 |
|
|
Change in current assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
2,387,505 |
|
|
|
(597,015 |
) |
|
Inventory
|
|
|
365,126 |
|
|
|
42,774 |
|
|
Prepaid expenses and other assets
|
|
|
(175,000 |
) |
|
|
(335,174 |
) |
|
Accounts payable
|
|
|
296,597 |
|
|
|
(1,679,980 |
) |
|
Funds held for others
|
|
|
- |
|
|
|
(59,707 |
) |
|
Accrued interest
|
|
|
(1,672,713 |
) |
|
|
579,486 |
|
|
Accounts payable - related party
|
|
|
108,234 |
|
|
|
123,002 |
|
|
Cash used in operating activities
|
|
|
(1,064,524 |
) |
|
|
(7,379,486 |
) |
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash received (paid) for PPE, net
|
|
|
417,857 |
|
|
|
(735,495 |
) |
|
Cash provided by (used in) investing activities
|
|
|
417,857 |
|
|
|
(735,495 |
) |
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal payments on long term debt
|
|
|
(72,255 |
) |
|
|
(2,314,680 |
) |
|
Proceeds from convertible debt
|
|
|
1,751,477 |
|
|
|
- |
|
|
Proceeds from the sale of common stock, net
|
|
|
10,500 |
|
|
|
4,354,000 |
|
|
Proceeds from long term debt
|
|
|
2,649,800 |
|
|
|
4,299,980 |
|
|
Net proceeds from (payments to) factoring agreement
|
|
|
(1,807,443 |
) |
|
|
565,657 |
|
|
Cash provided by financing activities
|
|
|
2,532,079 |
|
|
|
6,904,957 |
|
|
|
|
|
|
|
|
|
|
|
|
Increase(decrease) in cash and restricted cash
|
|
|
1,885,412 |
|
|
|
(1,210,024 |
) |
|
|
|
|
|
|
|
|
|
|
|
Cash and restricted cash, beginning of period
|
|
|
268,811 |
|
|
|
2,704,799 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and restricted cash, end of period
|
|
$ |
2,154,223 |
|
|
$ |
1,494,775 |
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Information
|
|
|
|
|
|
|
|
|
|
Non-cash investing and financing activities
|
|
|
|
|
|
|
|
|
|
Assumption of net assets and liabilities for asset acquisitions
|
|
$ |
- |
|
|
$ |
2,500,000 |
|
|
Common shares issued in asset acquisition
|
|
$ |
- |
|
|
$ |
24,400,000 |
|
|
Conversion of accounts payable to common stock
|
|
$ |
- |
|
|
$ |
231,661 |
|
|
Issuance of common shares with note payable
|
|
$ |
- |
|
|
$ |
87,250 |
|
|
Conversion of Series A Preferred into common stock
|
|
$ |
- |
|
|
$ |
161 |
|
|
Conversion of Series B Preferred into common stock
|
|
$ |
- |
|
|
$ |
1 |
|
|
Warrant exercise for common shares
|
|
$ |
- |
|
|
$ |
60 |
|
|
Discount on note due to beneficial conversion feature
|
|
$ |
- |
|
|
$ |
7,362,925 |
|
|
Cancellation of common shares
|
|
$ |
- |
|
|
$ |
11 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
|
$ |
208,154 |
|
|
$ |
281,832 |
|
|
Cash paid for income taxes
|
|
$ |
- |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Measures
Reconciliation of Adjusted EBITDA to Amounts Reported Under U.S. GAAP
|
|
|
For the three months ended June 30, 2020 |
|
|
For the three months ended June 30, 2019 |
|
|
Net Income
|
|
|
1,308,237 |
|
|
|
(8,961,042 |
) |
|
|
|
|
|
|
|
|
|
|
|
Interest & Other Expenses
|
|
|
1,011,003 |
|
|
|
5,606,766 |
|
|
Income Tax Expense
|
|
|
- |
|
|
|
- |
|
|
Accretion Expense
|
|
|
370,587 |
|
|
|
320,098 |
|
|
Depreciation
|
|
|
293,746 |
|
|
|
804,889 |
|
|
Amortization of Mining Rights
|
|
|
313,224 |
|
|
|
802,590 |
|
|
Amortization of Dedt Discount & Issuance
|
|
|
5,758 |
|
|
|
- |
|
|
Non-Cash Stock Options
|
|
|
142,296 |
|
|
|
73,602 |
|
|
Non-Cash Warrant Expense
|
|
|
1,108,675 |
|
|
|
- |
|
|
Non-Cash Share Comp. Expense
|
|
|
748,614 |
|
|
|
273,340 |
|
|
Development Costs
|
|
|
307,247 |
|
|
|
2,887,448 |
|
|
PCR Restructuring Expenses
|
|
|
113,889 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
Total Adjustments
|
|
|
4,415,039 |
|
|
|
10,768,733 |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
|
5,723,276 |
|
|
|
1,807,691 |
|
|
|
|
|
|
|
|
|
|
- Adjusted EBITDA is defined as net income before net interest expense, income tax expense, accretion expense, depreciation, non-cash stock compensation expense, transaction and other professional fees, and development costs. Adjusted EBITDA is not a measure of financial performance in accordance with GAAP, and we believe items excluded from Adjusted EBITDA are significant to a reader in understanding and assessing our financial condition. Therefore, Adjusted EBITDA should not be considered in isolation, nor as an alternative to net income, income from operations, cash flow from operations or as a measure of our profitability, liquidity, or performance under GAAP. We believe that Adjusted EBITDA presents a useful measure of our ability to incur and service debt based on ongoing operations. Furthermore, similar measures are used by analysts to evaluate our operating performance. Investors should be aware that our presentation of Adjusted EBITDA may not be comparable to similarly titled measures used by others.
About American Resources Corporation
American Resources Corporation is a supplier of high-quality raw materials to the rapidly growing global infrastructure market. The Company is focused on the extraction and processing of metallurgical carbon, an essential ingredient used in steelmaking. American Resources has a growing portfolio of operations located in the Central Appalachian basin of eastern Kentucky and southern West Virginia where premium quality metallurgical carbon deposits are concentrated.
American Resources has established a nimble, low-cost business model centered on growth, which provides a significant opportunity to scale its portfolio of assets to meet the growing global infrastructure market while also continuing to acquire operations and significantly reduce their legacy industry risks. Its streamlined and efficient operations are able to maximize margins while reducing costs. For more information visit americanresourcescorp.com or connect with the Company on Facebook, Twitter, and LinkedIn.
Special Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties, and other important factors that could cause the Company's actual results, performance, or achievements or industry results to differ materially from any future results, performance, or achievements expressed or implied by these forward-looking statements. These statements are subject to a number of risks and uncertainties, many of which are beyond American Resources Corporation's control. The words "believes", "may", "will", "should", "would", "could", "continue", "seeks", "anticipates", "plans", "expects", "intends", "estimates", or similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Any forward-looking statements included in this press release are made only as of the date of this release. The Company does not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent events or circumstances. The Company cannot assure you that the projected results or events will be achieved.
PR Contact:
Precision Public Relations
Matt Sheldon
917-280-7329
matt@precisionpr.co
Investor Contact:
JTC Team, LLC
Jenene Thomas
833-475-8247
AREC@jtcir.com
Company Contact:
Mark LaVerghetta
317-855-9926 ext. 0
Vice President of Corporate Finance and Communications
investor@americanresourcescorp.com
SOURCE: American Resources Corporation
View source version on accesswire.com:
https://www.accesswire.com/598728/American-Resources-Corporation-Reports-Second-Quarter-2020-Financial-Results-and-Provides-Business-Outlook
