Surety bond, letters of credit and bank guarantees
In the
normal course
of business,
the Company
is a
party to
certain guarantees
and financial
instruments with
off-balance sheet risk, such as bank
guarantees, letters of credit and performance
or surety bonds.
No
related
to
these
arrangements
are
reflected
in
the
Company’s
unaudited
Condensed
Consolidated
Balance
Sheets. Management does
not expect any
material losses to
result from these
guarantees or off-balance
sheet
financial instruments.
For
the U.S.
Operations,
in
order to
provide
the required
financial
assurance
for post
mining
reclamation,
the
Company generally uses
surety bonds. The
Company uses surety
bonds and bank
letters of credit
to collateralize
certain other obligations
including contractual obligations
under workers’ compensation
insurance. As of
March
31, 2026, the
Company had
outstanding surety
bonds and
bank guarantees
of $
20.0
10.0
For the
Australian Operations,
as at
March 31,
2026, the
Company had
bank guarantees
outstanding of
$
36.6
million, primarily in respect of certain rail and port take-or-pay
arrangements of the Company.
As
of
March
31,
2026,
the
Company
in
aggregate
had
total
outstanding
bank
guarantees
of
$
46.6
secure its obligations and commitments.
Future regulatory changes relating to
these obligations or deterioration of
the Company’s credit risk
rating could
result in increased obligations, additional costs or additional
collateral requirements.
Restricted deposits – cash collateral
As required by
certain agreements, the
Company had total
cash collateral in
the form of
deposits of $
144.4
and $
141.7
million as of March 31, 2026 and
December 31, 2025, respectively,
to provide back-to-back support
for
bank
guarantees,
other
performance
obligations,
various
other
operating
agreements
and
contractual
obligations under workers compensation insurance.
These deposits are restricted and classified as “Non-current
assets” in the unaudited Condensed Consolidated Balance
Sheets.
Future
regulatory
changes
in
relation
to
these
obligations
or
deterioration
of
the
Company’s
credit
risk
rating
could result in increased obligations, additional costs or
additional collateral requirements.
From time
to time,
the Company
is a
party to
legal proceedings
in the
ordinary course
of business
in Australia
and the
U.S.
Based on
current information,
the Company
believes that
all pending
or threatened
proceedings
are likely to be resolved without a material
adverse effect on its financial condition,
results of operations or cash
flows.
In
management’s
opinion,
the
Company
is
not
currently
involved
in
any
legal
proceedings
which,
individually or in
the aggregate,
could have a
material effect on
the financial condition,
results of operations
and/or
liquidity of the Company.