June 6, 2022 - Alpha Metallurgical Resources, Inc. (NYSE: AMR), a leading U.S. supplier of metallurgical products for the steel industry, today announced several positive financial updates, including the elimination of its remaining term loan balance.
Long-Term Debt Elimination
On June 3, 2022, Alpha made a voluntary prepayment of $99.4 million on its term loan, which eliminated all remaining principal and paid the loan in full.
"Today we are pleased to announce that Alpha's term loan has been paid in full, eliminating our long-term debt," said David Stetson, Alpha's chair and chief executive officer. "As we have mentioned consistently over the past few quarterly calls, this is a critically important milestone for our company, and a significant step in further strengthening Alpha's balance sheet. In just under a year's time, more than $550 million has been paid toward eliminating Alpha's long-term debt load, which allowed us to extinguish the term loan and its carrying costs two years ahead of maturity."
Share Repurchase Program
As previously announced, Alpha's board of directors authorized a $600 million share repurchase program. As of June 3, the company has acquired 860,934 shares of common stock at a cost of $126.3 million.
In connection with Alpha's improved financial position, the company has received a reduction of $40.1 million in collateral requirements related to its self-insured workers compensation at certain locations in West Virginia.
Additionally, as part of routine surety program review and negotiation, the company has received a $16.5 million reduction in surety collateral requirements, while securing multi-year visibility on surety program terms and conditions.
Alpha's president and chief financial officer, Andy Eidson, elaborated on today's financial announcements: "These collateral releases, which are in the form of letters of credit, directly increase our ABL availability, and thus our financial liquidity, by nearly $57 million. Taken together with the final payment to eliminate Alpha's term loan, these developments represent a further de-risking of our balance sheet and demonstrate our commitment to building a company that is resilient through any market. Additionally, we are pleased to provide an update on the progress of our share repurchase program, which we still believe to be the best investment we can make at this point in time. We are excited about where Alpha is heading, and we look forward to continuing this positive momentum."