Ramaco Swings to Loss Amid Revenue Drop, Bets on Rare Earths

TL;DR

**Ramaco's Q3 is a bloodbath, but their rare earth bet is a high-risk, high-reward play that could pay off big if they execute.**

AI Summary

Ramaco Resources, Inc. (METCZ) reported a significant decline in financial performance for the nine months ended September 30, 2025, with revenue decreasing by 17.5% to $408.611 million from $495.403 million in the prior year. The company swung to a net loss of $36.741 million, a stark contrast to the net income of $7.334 million reported for the same period in 2024. This resulted in a basic loss per Class A common share of $0.74, down from a gain of $0.05. Operating loss for the nine months was $40.349 million, compared to an operating income of $10.285 million in 2024. Key business changes include the initiation of rare earth element and critical mineral operations at the Brook Mine in June 2025, aiming for pilot-scale testing and eventual commercial processing. The company's cash and cash equivalents significantly increased to $193.846 million as of September 30, 2025, from $33.009 million at December 31, 2024, largely due to a $189.000 million equity offering and $64.931 million in proceeds from senior notes. Risks include the unproven nature of rare earth element mining for Ramaco and the highly competitive and rapidly changing environment in both metallurgical coal and rare earth markets. The strategic outlook involves developing the Brook Mine for rare earth elements and critical minerals, alongside its established metallurgical coal operations.

Why It Matters

Ramaco's pivot into rare earth elements and critical minerals, as evidenced by the Brook Mine development, is a significant strategic shift that could diversify its revenue streams away from the volatile metallurgical coal market. For investors, the substantial net loss of $36.741 million and declining revenue highlight immediate financial pressures, but the long-term potential of the rare earth venture could offer a new growth vector, albeit with higher risk. Employees in the new rare earth segment may see job growth, while those in coal operations face ongoing market challenges. Customers in the steel industry will continue to rely on Ramaco's metallurgical coal, but future customers for rare earth oxides could emerge. The broader market will watch to see if Ramaco can successfully transition into a critical minerals producer, potentially impacting the domestic supply chain for these strategic materials and intensifying competition in the nascent U.S. rare earth sector.

Risk Assessment

Risk Level: high — The company reported a net loss of $36.741 million for the nine months ended September 30, 2025, a significant deterioration from a $7.334 million net income in the prior year. Furthermore, Ramaco is entering a new, unproven business segment with rare earth element mining, a type of mining it has not previously pursued, as explicitly stated in the 'Cautionary Note Regarding Forward-Looking Statements,' which introduces substantial operational and commercialization risks.

Analyst Insight

Investors should exercise extreme caution and conduct thorough due diligence on Ramaco's rare earth element venture. While the equity offering of $189.000 million and senior notes proceeds of $64.931 million have bolstered cash, the significant net loss and revenue decline in its core business indicate fundamental challenges. Consider this a speculative play on the successful commercialization of rare earth elements, and only allocate capital that can be fully lost.

Financial Highlights

debt To Equity

0.61

revenue

$408.611M

operating Margin

-9.87%

total Assets

$849.655M

total Debt

$279.237M

net Income

$(36.741)M

eps

$(0.74)

gross Margin

15.55%

cash Position

$193.846M

revenue Growth

-17.5%

Revenue Breakdown

Key Numbers

• $408.611M — Revenue (Decreased by 17.5% from $495.403 million in 2024 for the nine months ended September 30, 2025.)
• $(36.741)M — Net Loss (Swung from a net income of $7.334 million in 2024 for the nine months ended September 30, 2025.)
• $(0.74) — Basic Loss Per Class A Share (Compared to a gain of $0.05 in 2024 for the nine months ended September 30, 2025.)
• $193.846M — Cash and Cash Equivalents (Increased significantly from $33.009 million at December 31, 2024.)
• $189.000M — Proceeds from Equity Offering (Major contributor to increased cash flow in the nine months ended September 30, 2025.)
• $64.931M — Proceeds from Senior Notes (Contributed to increased cash flow in the nine months ended September 30, 2025.)
• $50.139M — Capital Expenditures (Increased from $44.634 million in 2024 for the nine months ended September 30, 2025.)
• $13.308M — Net Loss (Q3 2025) (Reported for the three months ended September 30, 2025, compared to a net loss of $0.239 million in Q3 2024.)

Key Players & Entities

• Ramaco Resources, Inc. (company) — registrant
• SEC (regulator) — Securities and Exchange Commission
• Brook Mine (company) — rare earth element and critical mineral operations
• NASDAQ Global Select Market (company) — exchange where securities are registered
• Delaware (company) — state of incorporation
• Lexington, Kentucky (person) — principal corporate and executive offices
• Sheridan, Wyoming (person) — location of rare earth element operations
• Metallurgical Coal (company) — reportable segment
• Rare Earths and Critical Minerals (company) — reportable segment

FAQ

Risk Factors

• Volatile Coal and Rare Earth Markets [high — market]: Ramaco operates in both the metallurgical coal and rare earth element (REE) markets, both of which are subject to significant price volatility and competitive pressures. The REE market is particularly new and unproven for the company, introducing additional uncertainty.
• Execution of New REE Operations [high — operational]: The company has initiated REE operations at the Brook Mine, with pilot-scale testing underway. The success of this venture is not guaranteed, and scaling up to commercial processing presents significant operational and technical challenges.
• Dependence on Equity and Debt Financing [medium — financial]: The company raised $189.000 million in an equity offering and $64.931 million from senior notes to bolster its cash position. Future growth and REE operations may require substantial ongoing capital, increasing reliance on external financing.
• Mine Safety and Environmental Compliance [medium — regulatory]: As a mining company, Ramaco is subject to stringent mine safety regulations (Item 4. Mine Safety Disclosures) and environmental compliance requirements. Failures in these areas can lead to significant fines, operational disruptions, and reputational damage.

Industry Context

Ramaco operates in the highly competitive metallurgical coal market, which is subject to global supply and demand dynamics and pricing volatility. The company is also venturing into the nascent and rapidly evolving rare earth element (REE) market, driven by increasing demand for critical minerals in advanced technologies. This diversification aims to leverage existing mining expertise while tapping into new growth opportunities.

Regulatory Implications

As a mining entity, Ramaco is subject to rigorous environmental, health, and safety regulations. Compliance with these regulations is critical to avoid operational disruptions, fines, and reputational damage. The development of new operations, particularly in REEs, may also involve navigating new permitting and regulatory frameworks.

What Investors Should Do

1. Monitor REE operational progress and cost management closely.
2. Assess the sustainability of the current cash burn rate against future capital needs.
3. Evaluate the impact of metallurgical coal market fluctuations on core business performance.

Key Dates

• 2025-09-30: End of Nine Months Reporting Period — Reported a net loss of $36.741 million and revenue of $408.611 million, a significant downturn from the prior year.
• 2025-06-01: Initiation of REE Operations at Brook Mine — Marks a strategic pivot into rare earth elements and critical minerals, aiming for pilot-scale testing and future commercialization.
• 2025-09-30: Cash and Cash Equivalents Balance — Increased to $193.846 million, primarily due to a $189.000 million equity offering and $64.931 million in senior notes, strengthening liquidity.
• 2024-12-31: Prior Year End Balance Sheet — Provided a baseline for comparison, with cash and cash equivalents at $33.009 million and positive net income.

Glossary

Metallurgical Coal

A type of coal used in the production of steel and other metals, often referred to as 'met coal'. (Ramaco's primary legacy business, the performance of which significantly impacts overall financial results.)

Rare Earth Elements (REEs)

A group of 17 chemical elements with unique properties crucial for many modern technologies, including electronics, magnets, and defense systems. (A new strategic focus for Ramaco, representing a potential growth area but also a significant unproven venture.)

Operating Loss

Occurs when a company's total costs and expenses exceed its total revenue from its core business operations. (Indicates that Ramaco's core operations are not generating enough revenue to cover their costs, resulting in a loss before interest and taxes.)

Equity Offering

The sale of stock by a company to raise capital from investors. (A key source of the recent increase in Ramaco's cash position, providing funds for operations and strategic initiatives.)

Senior Notes

A type of debt instrument that has a higher priority claim on the assets of an issuer than other unsecured debt. (Another significant source of capital for Ramaco, contributing to its increased cash reserves.)

Year-Over-Year Comparison

Ramaco Resources, Inc. has experienced a significant financial deterioration compared to the prior year. Revenue for the nine months ended September 30, 2025, declined by 17.5% to $408.611 million from $495.403 million in 2024. This revenue drop, coupled with increased SG&A expenses, led to a swing from an operating income of $10.285 million to an operating loss of $40.349 million. Consequently, the company reported a net loss of $36.741 million, a stark contrast to the net income of $7.334 million in the prior year, resulting in a basic loss per share of $0.74 compared to a gain of $0.05. While cash reserves have substantially increased due to financing activities, the core operational performance has weakened considerably.

Key Financial Figures

• $0.01 — which registered Class A Common Stock, $0.01 par value METC NASDAQ Global Select Mar

Filing Documents

• ea0261603-10q_ramaco.htm (10-Q) — 987KB
• ea026160301ex10-1_ramaco.htm (EX-10.1) — 74KB
• ea026160301ex10-5_ramaco.htm (EX-10.5) — 73KB
• ea026160301ex31-1_ramaco.htm (EX-31.1) — 10KB
• ea026160301ex31-2_ramaco.htm (EX-31.2) — 10KB
• ea026160301ex32-1_ramaco.htm (EX-32.1) — 4KB
• ea026160301ex32-2_ramaco.htm (EX-32.2) — 4KB
• ea026160301ex95-1_ramaco.htm (EX-95.1) — 82KB
• 0001213900-25-102891.txt ( ) — 5977KB
• metc-20250930.xsd (EX-101.SCH) — 53KB
• metc-20250930_cal.xml (EX-101.CAL) — 41KB
• metc-20250930_def.xml (EX-101.DEF) — 238KB
• metc-20250930_lab.xml (EX-101.LAB) — 451KB
• metc-20250930_pre.xml (EX-101.PRE) — 247KB
• ea0261603-10q_ramaco_htm.xml (XML) — 763KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements 1 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 21 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 31 Item 4.

Controls and Procedures

Controls and Procedures 31

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 32 Item 1A.

Risk Factors

Risk Factors 32 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 34 Item 3. Defaults Upon Senior Securities 34 Item 4. Mine Safety Disclosures 34 Item 5. Other Information 34 Item 6. Exhibits 35

SIGNATURES

SIGNATURES 36 i CAUTIONARY NOTE REGARDING FORWARD-LOOKING This Quarterly Report on Form 10-Q (this "Quarterly Report") includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements, other than statements of historical fact included in this report, regarding our strategy, future operations, financial position, estimated revenue and losses, projected costs, prospects, plans, and objectives of management are forward-looking statements. When used in this Quarterly Report, the words "could," "believe," "anticipate," "intend," "estimate," "expect," "project" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management's current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements described under, but not limited to, the heading "Item 1A. Risk Factors" included in this Quarterly Report and elsewhere in the Annual Report of Ramaco Resources, Inc. (the "Company") on Form 10-K for the year ended December 31, 2024 (the "Annual Report") filed with the United States Securities and Exchange Commission (the "SEC") on March 17, 2025, as well as other filings of the Company with the SEC.

Forward-looking statements may include statements about

Forward-looking statements may include statements about: the expected commercialization of rare earth elements and critical minerals operations; identification and implementation of commercially feasible extraction processes, and establishment of pilot and commercial production extraction facilities; anticipated coal and rare earth elements and critical mineral oxide production levels, costs, sales volumes, and revenue; timing and ability to complete major capital projects; economic conditions in the metallurgical coal, steel, and rare earth elements and critical mineral industries; expected costs to develop planned and future mining operations, including the costs to construct necessary processing, refuse disposal and transport facilities; the availability of the equipment and components necessary to construct our pilot and commercial production extraction facilities; estimated quantities or quality of our metallurgical reserves and rare earth elements and critical minerals resources; our ability to obtain additional financing on favorable terms, if required, to complete the acquisition of additional metallurgical coal reserves or to fund the operations and growth of our business, including our rare earth and critical mineral operations; maintenance, operating or other expenses or changes in the timing thereof; the financial condition and liquidity of our customers; competition in coal and rare earth elements and critical mineral markets; the price and demand for metallurgical coal, thermal coal, and rare earth elements and critical mineral oxides; compliance with stringent domestic and foreign laws and regulations, including environmental, climate change and health and safety regulations, and permitting requirements, as well as changes in the regulatory environment, the adoption of new or revised laws, regulations and permitting requirements; potential legal proceedings and regulatory inquiries against us; the impact of weather and natural

forward-looking statements that we or persons acting on our behalf may issue

forward-looking statements that we or persons acting on our behalf may issue. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report. iii

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Ramaco Resources, Inc. Unaudited Condensed Consolidated Balance Sheets In thousands, except share and per share information September 30, 2025 December 31, 2024 Assets Current assets Cash and cash equivalents $ 193,846 $ 33,009 Accounts receivable 43,612 73,582 Inventories 81,574 43,358 Prepaid expenses and other 9,695 17,685 Total current assets 328,727 167,634 Property, plant, and equipment, net 489,170 482,019 Financing lease right-of-use assets, net 19,808 12,437 Advanced coal royalties 5,446 4,709 Other 6,504 7,887 Total Assets $ 849,655 $ 674,686 Liabilities and Stockholders' Equity Liabilities Current liabilities Accounts payable $ 41,675 $ 48,855 Accrued liabilities 58,467 61,659 Current portion of asset retirement obligations 1,035 1,035 Current portion of long-term debt 140 359 Current portion of financing lease obligations 8,966 6,218 Insurance financing liability 283 4,302 Total current liabilities 110,566 122,428 Long-term asset retirement obligations 31,208 30,052 Long-term equipment loans - 57 Long-term borrowings on revolving credit facility - - Long-term financing lease obligations 10,955 7,517 Senior notes, net 116,316 88,135 Deferred tax liability, net 46,386 56,027 Other long-term liabilities 7,312 7,664 Total liabilities 322,743 311,880 Commitments and contingencies Stockholders' Equity Preferred stock, $ 0.01 par value, 50,000,000 shares authorized, none issued or outstanding - - Class A common stock, $ 0.01 par value, 225,000,000 shares authorized, 55,169,250 at September 30, 2025 and 43,824,999 at December 31, 2024 shares issued and outstanding 445 438 Class B common stock, $ 0.01 par value, 35,000,000 shares authorized, 10,842,811 at September 30, 2025 and 9,549,914 at December 31, 2024 shares issued and outstanding 104 95 Additional paid-in capital 509,272 292,739 Retained e

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