Peabody Energy Corporation is a St. Louis, Missouri-headquartered global coal producer (NYSE: BTU) operating across seaborne thermal (Australian export/domestic), seaborne metallurgical (Australian hard coking coal, Centurion Mine ramp), and U.S. thermal (Powder River Basin, Other U.S. Thermal). For Q2 2026, revenue of $1.003B was up 12.7% YoY ($890M) and 3.1% QoQ ($973M). Net loss attributable to common stockholders of $(90.6)M ($(0.74)/share) vs $(27.6)M YoY, driven by Seaborne Metallurgical Adjusted EBITDA of $(17.0)M (Centurion commissioning costs), PRB Adjusted EBITDA of $(7.1)M (mild weather, maintenance downtimes), partially offset by Seaborne Thermal $52.1M (+55% YoY, pricing +12.4% QoQ) and Other U.S. Thermal $26.9M. Total Adjusted EBITDA $24.0M vs $93.3M YoY. Capital structure transformation: $250M 0.5% 2031 convertible notes issued (capped call at $50.61), $241.2M 3.25% 2028 convertible notes repurchased for $386.8M (effectively 5.0M shares), surety arrangements reducing restricted cash/collateral by ~$350M (43%), revolver increased to $400M. Cash $526.3M, total liquidity $959.1M. Quarterly dividend $0.075/share declared. H2 guidance: Centurion targeting 1.5-2.0M tons, Seaborne Thermal 3.0M tons, PRB 22M tons at $13.60/ton. FY2026 guidance: Seaborne Thermal 12.4-13.0M tons, Seaborne Met 8.8-10.3M tons, PRB 82-88M tons, CapEx $340M.
The investment thesis rests on three variables. The Centurion Mine ramp and the seaborne metallurgical margin recovery is the load-bearing growth variable, with Q2 Adjusted EBITDA of $(17.0)M on 2.5M tons (costs $155/ton vs revenue $148/ton), H2 targeting 1.5-2.0M tons at run-rate costs, and the strategic intent is to achieve targeted production rates and move metallurgical segment to positive margins, and the market will track the quarterly Centurion tons, costs per ton, and the longwall move schedule as real-time indicators. The capital structure optimization and the shareholder return framework is the load-bearing financial variable, with the convertible note refinancing (2031 issuance + 2028 repurchase), surety collateral release (~$350M), revolver expansion ($400M), 5.0M effective share repurchase, $0.075 quarterly dividend, and the strategic intent is to continue reducing dilution, lowering borrowing costs, and returning capital, and the market will track the further 2028 note repurchases, share buybacks, and the leverage trajectory as real-time indicators. The seaborne thermal pricing resilience and the PRB cost discipline is the load-bearing base business variable, with Seaborne Thermal Adjusted EBITDA margin/ton of $16.92 (export $95.87 realized, domestic $36.69), PRB costs at $14.06/ton (guidance $11.75-12.25 in H2), and the strategic intent is to maintain thermal margins while managing the volume/cost dynamics, and the market will track the Newcastle/API5 pricing, the Newcastle high-ash discount, the PRB weather impacts, and the rail logistics as real-time indicators.