Good afternoon. My name is Allan, and I will be your conference operator today. At this time, I would like to welcome everyone to the Warrior Third Quarter 2023 Financial Results Conference Call. [Operator Instructions]. This call is being recorded and will be available for replay on the company's website. Before we begin, I have been asked to note that today's discussion may contain forward-looking statements, and actual results may differ materially from those discussed. For more information regarding forward-looking statements, please refer to the company's press releases and SEC filings. I have also been asked to note that the company has posted reconciliations of the non-GAAP financial measures discussed during this call in the tables accompanying the company's earnings press release located on the Investors section of the company's website at www.warriormetcoal.com. In addition to the earnings release, the company has posted a brief supplemental slide presentation to the Investors section of its website at www.warriormetcoal.com. Here today to discuss the company's results are Mr. Walt Scheller, Chief Executive Officer; and Mr. Dale Boyles, Chief Financial Officer. Mr. Scheller, you may begin your remarks.

Thanks, operator. Hello, everyone, and thank you for taking the time to join us today to discuss our third quarter 2023 results. After my remarks, Dale will review our results in additional detail then you'll have the opportunity to ask questions. We were pleased to deliver another strong quarter in which we were able to leverage our operational excellence to achieve record sales volume, which represented a 51% increase over last year's third quarter. We continue to see improved performance from our transportation partners and at the McDuffie Terminal, which allowed us to ship more volume and reduce our excess inventory. Our quarter-over-quarter growth in sales volume also yielded strong profitability as well, generating a cash margin of $158 million or $70 per short ton. Steel output from China, the world's largest producer, was stronger than we had anticipated, and it's widely [indiscernible] production cuts have not yet materialized. In fact, weaker domestic demand has led China to export higher-than-normal volumes of steel, which has impacted supply in some of our customers' markets. With the exception of India, most other major steel-producing regions experienced lower demand and as a result, lower prices for their finished products. We've heard of customers adjusting their production rates to match demand. In contrast, the met coal index for premium low-vol coals experienced large upward trends during the latter part of the third quarter, while most other indices experienced more modest gains. These factors have put our customers' margins under pressure with the diverging steel prices in relation to raw material costs. In sharp contrast to the second quarter this year, the availability of premium hard coking coals was tight during the third quarter as several Australian producers began their maintenance programs. In addition, the vulnerability of the supply chain was on display again with…

Thanks, Walt. For the third quarter of 2023, the company recorded net income on a GAAP basis of $85 million or $1.64 per diluted share, representing a decrease over the net income of $98 million or $1.90 per diluted share in the same quarter of last year. Non-GAAP adjusted net income for the third quarter, excluding the nonrecurring loss on the early extinguishment of debt, business interruption and other expenses, was $1.85 per diluted share. This compares to adjusted net income of $2.10 per diluted share in the same quarter of 2022. These decreases quarter-over-quarter were primarily driven by a 26% lower average net selling price combined with lower financial results from our gas business, which were offset partially by 51% higher sales volume. We reported adjusted EBITDA of $146 million in the third quarter of this year compared to $172 million in the same quarter of last year. The quarterly decrease was primarily driven by a number of factors. First, the average net selling price of our steelmaking coal was 26% lower than the prior year quarter. Second, as I mentioned, we saw lower financial results from our gas business. However, these were partially offset by 51% increase in sales volume and lower transportation and [indiscernible] cost. Our adjusted EBITDA margin was 34% in the third quarter of this year compared to 44% in the same quarter of last year. Total revenues were $423 million in the third quarter compared to $390 million in the third quarter of last year. This 9% increase was primarily due to the 51% increase in sales volume, offset by the 26% decrease in average net selling prices. Other revenues from our gas business were 64% lower in the third quarter of this year primarily due to a 72% decrease in natural gas prices…

Thanks, Dale. Before we move over to Q&A, I'd like to make some final comments. We remain cautious for the fourth quarter, especially in light of the evolving situation in the Middle East and also because of the distortion in price indices. Demand for steel is expected to remain weak but stable until the end of the year. However, we do recognize the uncertainty in the global economy and are closely monitoring its impact on steel demand. We expect met coal pricing to remain under pressure during the fourth quarter, potentially [indiscernible] back some of the gains we saw recently, mainly supported by expected improvements in coal availability. For Warrior, now that we reduced our excess inventory, we expect our fourth quarter volumes to be seasonally lower as implied by our year-to-date performance compared to our full year volume guidance. There are a number of factors contributing to those lower fourth quarter volume expectations. First is the continued weak customer spot demand in our natural markets. Second is that we have fewer operating days associated with the end of the year holidays. Third, we'll perform some needed mine maintenance. And fourth, we'll take a more strategic approach to maximize market pricing and profitability for our premium hard coking coals into the spot market. With that, we'd like to open the call for questions. Operator?

[Operator Instructions]. Our first question comes from Lucas Pipes from B. Riley Securities.

Walt and Dale, appreciate all the color in the prepared remarks. My first 2 questions tie in to your final comments there, Walt. First on the production side, when I think about the low end of guidance for the full year and what that implies for Q4, I come out to about 1.1 million tons. And when I looked at your historical production, I'd have to go back to 2021 and of course, you have the strike to see that level of output. So are you seeing anything specifically in your mine plan that would -- that could lead to this low end of the guidance for the full year on the production side? Or is that maybe just a degree of conservatism.

No, that's a -- that one would be extraordinarily conservative. Our expectations are well above that. I would say you can imply a 1 5-ish number, 1 4, 1 5, 1 55, something like that.

And that's for production Q4?

That's for production, yes.

And I would expect -- this is Dale, Lucas. I would expect probably sales volume to be a similar number. And I think both of those would kind of get you right near the upper end of our guidance if you just kind of take the year-to-date results.

Got it. That's very helpful. And then I do want to tie in the commercial side. Lots to discuss there, but maybe just to keep the discussion focused for now. In the fourth quarter, what percentage of your anticipated sales would be linked to the Australian FOB PLV index? What percentage would be more spot exposed? And what is the best benchmark to use as inadequate as it might be for those spot volumes?

This is Dale. Probably about 1/4 or 25%, I think, is spot in the fourth quarter. And that just depends on where that goes. If that goes into India, it could be on a CFR India or China index, could be an AC 64, could be some PLV Australia. But the contract should be -- contracted volume should be at the PLV FOB Australian rate index.

So there is a range of potential pricing indices, and you will be efficient. Now hypothetically, of the range of those indices that you mentioned, what would be the most conservative netback price today?

Today, do not know. I really don't know what that would be today because I'm sorry, I didn't check on those rates today. But just suffice it to say, the spot volume because of all the dislocation that we've talked about with not only the between the indices but then the additional freight, we saw some of those differences greater than $100 a ton back during the quarter. So if you do have the supply coming back online out of Australia pretty strongly in the fourth quarter, I think you will see PLV prices drop, and you'll see those are narrowed quite substantially. So it would be a real, real guess to tell you what that might be right now on that spot volume.

Okay. This is still -- this is helpful color, Dale. I appreciate that very much. I'll try to squeeze one Blue Creek question. And I think in your prepared remarks, you mentioned equipment delays. One, can you expand on that? And then two, equipment delays can often cause knock-on effects where the development doesn't go as initially planned. You work around things, and that can lead to cost pressures. Is that reading too much into this? Or are you still monitoring that situation from a cost perspective?

Actually, some of the equipment delays were for Mines 4 and Mine 7. Even with Blue Creek, we've placed those orders far enough out in advance that we are -- we remain comfortable with the delivery times for everything we've ordered. We've made sure we've done everything we can to lock those things in and get our slots with vendors to assure that we'll have the equipment when we need it.

[Operator Instructions]. At this time, there are no further questions. I will now turn the call back over to Mr. Scheller for any comments.

That concludes our call this afternoon. Thank you again for joining us today. We appreciate your interest in Warrior.

Thank you. And that concludes today's conference. Thank you all for participating. You may now disconnect.