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Long-term Debt | 3 Months Ended
--- | ---
Mar. 31, 2025
Debt Disclosure [Abstract] |
Long-term Debt | Long-term Debt The Company’s total indebtedness as of March 31, 2025 and December 31, 2024 consisted of the following:
Debt Instrument (defined below, as applicable) | March 31, 2025 |  | December 31, 2024
| (Dollars in millions)
3.250% Convertible Senior Notes due March 2028 (2028 Convertible Notes) | $ | 320.0 |  |  | $ | 320.0 |
BUMA Loan Note | 9.5 |  |  | 9.3 |
Finance lease obligations | 23.5 |  |  | 25.1 |
Less: Debt issuance costs | (5.8) |  |  | (6.3) |
| 347.2 |  |  | 348.1 |
Less: Current portion of long-term debt | 16.0 |  |  | 15.8 |
Long-term debt | $ | 331.2 |  |  | $ | 332.3 |
2028 Convertible Notes On March 1, 2022, through a private offering, the Company issued the 2028 Convertible Notes in the aggregate principal amount of $320.0 million. The 2028 Convertible Notes are senior unsecured obligations of the Company and are governed under an indenture. The Company used the proceeds of the offering of the 2028 Convertible Notes and available cash to redeem its then-existing senior secured notes and to pay related premiums, fees and expenses relating to the offering and redemptions. The Company capitalized $11.2 million of debt issuance costs related to the offering, which are being amortized over the terms of the notes. The 2028 Convertible Notes will mature on March 1, 2028, unless earlier converted, redeemed or repurchased in accordance with their terms. The 2028 Convertible Notes bear interest at a rate of 3.250% per year, payable semi-annually in arrears on March 1 and September 1 of each year. The initial conversion rate for the 2028 Convertible Notes was 50.3816 shares of the Company’s common stock per $1,000 principal amount of 2028 Convertible Notes, which represented an initial conversion price of approximately $19.85 per share of the Company’s common stock. The terms of the indenture require conversion rate adjustments upon the payment of dividends to holders of the Company’s common stock once such cumulative dividends impact the conversion rate by at least 1%. Effective February 19, 2025, the conversion rate was increased to 51.7762 shares of the Company’s common stock per $1,000 principal amount of 2028 Convertible Notes, which represented an adjusted conversion price of approximately $19.31 per share. The conversion rate may be impacted prospectively, based upon cumulative dividends paid. The conversion rate is also subject to further adjustment under certain circumstances in accordance with the terms of the indenture. During the first quarter of 2025, the Company’s reported common stock prices did not prompt the conversion feature of the 2028 Convertible Notes. As a result, the 2028 Convertible Notes will not be convertible at the option of the holders during the second quarter of 2025. As of March 31, 2025, the if-converted value of the 2028 Convertible Notes did not exceed the principal amount. Revolving Credit Facility The Company established a revolving credit facility with a maximum aggregate principal amount of $320.0 million in revolving commitments by entering into a credit agreement, dated as of January 18, 2024 (the 2024 Credit Agreement), by and among the Company, as borrower, certain subsidiaries of the Company party thereto, PNC Bank, National Association, as administrative agent, and the lenders party thereto. The Company paid aggregate debt issuance costs of $9.7 million. The revolving commitments and any related loans, if applicable (any such loans, the Revolving Loans), established by the 2024 Credit Agreement terminate or mature, as applicable, on January 18, 2028, subject to certain conditions relating to the Company’s outstanding 2028 Convertible Notes. The Revolving Loans bear interest at a secured overnight financing rate (SOFR) plus an applicable margin ranging from 3.50% to 4.25%, depending on the Company’s total net leverage ratio (as defined under the 2024 Credit Agreement) or a base rate plus an applicable margin ranging from 2.50% to 3.25%, at the Company’s option. Letters of credit issued under the 2024 Credit Agreement incur a combined fee equal to an applicable margin ranging from 3.50% to 4.25% plus a fronting fee equal to 0.125% per annum. Unused capacity under the 2024 Credit Agreement bears a commitment fee of 0.50% per annum. On November 25, 2024, the Company amended the 2024 Credit Agreement to, among other things, permit (i) Peabody’s planned acquisition of multiple coal mines from Anglo American plc (Anglo) as further discussed in Note 11. “Other Events,” (ii) the related bridge loan facility and (iii) the incurrence of additional indebtedness to finance the acquisition, subject to compliance with certain pro forma financial covenants. The Company paid aggregate deferred financing costs of $0.9 million as part of the amendment. As of March 31, 2025, the 2024 Credit Agreement had only been utilized for letters of credit, including $49.3 million outstanding as of March 31, 2025. These letters of credit support the Company’s reclamation bonding requirements, lease obligations, insurance policies and various other performance guarantees as further described in Note 13. “Financial Instruments and Other Guarantees.” Availability under the 2024 Credit Agreement was $270.7 million at March 31, 2025. The 2024 Credit Agreement contains customary covenants that, among other things and subject to certain exceptions (including compliance with financial ratios), may limit the Company and its subsidiaries’ ability to incur additional indebtedness, make certain restricted payments or investments, sell or otherwise dispose of assets, enter into transactions with affiliates, create or incur liens, and merge, consolidate or sell all or substantially all of their assets. The 2024 Credit Agreement is secured by substantially all assets of the Company and its U.S. subsidiaries, as well as a pledge of two Australian subsidiaries. BUMA Loan Note The Company has agreed to, following the closing of the Anglo acquisition, sell a portion of the assets (the Dawson Assets) to Pt Bukit Makmur Mandiri Utama or one of its subsidiaries (BUMA). Accordingly, on November 25, 2024, concurrent with its entry into the purchase agreements for the Anglo acquisition, the Company entered into a loan note deed with BUMA pursuant to which BUMA will lend to the Company the funds required to purchase the Dawson Assets under the Anglo acquisition purchase agreements and fund certain other obligations in relation to the Dawson Assets (the BUMA Loan Note). The Company received $9.3 million in BUMA Loan Note proceeds during the year ended December 31, 2024 to fund a portion of the deposit to Anglo for the planned acquisition. The BUMA Loan Note bears interest at a coupon rate of 10% per year. During the period ended March 31, 2025, the Company capitalized $0.2 million interest expense to the BUMA Loan Note principal balance in accordance with the terms of the loan note deed. Refer to Note 11. “Other Events” for additional information associated with the Anglo acquisition. Bridge Loan Facility Concurrently with its entry into definitive agreements to acquire the Anglo assets, the Company entered into a bridge loan facility commitment letter (the Bridge Commitment Letter and, the senior secured 364-day bridge facility provided for therein, the Bridge Facility), pursuant to which the lenders, agreed to provide the Bridge Facility to the Company in the amount of up to $2.075 billion in order to finance the planned acquisition in part. The Company expects to replace the Bridge Facility with permanent financing prior to the closing date, but there can be no assurance such financing will occur and any such expectation is subject to market conditions. To the extent borrowings are made under the Bridge Facility, any loans would bear interest at a SOFR plus an applicable margin of 8.00% or a base rate plus an applicable margin of 7.00%, at the Company’s option. Such applicable margin would increase by an additional 0.75% on the date that is 90 days following the closing date of the planned acquisition. Any borrowings under the Bridge Facility would mature 364 days from the initial funding date, which would be on or around the closing date of the planned acquisition. The availability of borrowings under the Bridge Facility is subject to the satisfaction of certain customary conditions for transactions of this type. Any definitive financing documentation for the Bridge Facility will contain customary representations and warranties, covenants and events of defaults for transactions of this type. Upon execution of any definitive financing documentation for the Bridge Facility, the Bridge Facility will be guaranteed by substantially all U.S. subsidiaries of the Company and secured by substantially all assets of the Company, its U.S. subsidiaries and, subject to certain conditions, certain of the Company’s Australian subsidiaries. Interest Charges The following table presents the components of the Company’s interest expense related to its indebtedness and financial assurance instruments such as surety bonds and letters of credit. Additionally, the table sets forth the amount of cash paid for interest, net of capitalized interest and the amount of non-cash interest expense primarily related to the amortization of debt issuance costs.
|  |  | Three Months Ended March 31,
|  |  |  |  | 2025 |  | 2024
|  |  |  |  | (Dollars in millions)
2028 Convertible Notes |  |  |  |  | $ | 2.6 |  |  | $ | 2.6 |
Finance lease obligations |  |  |  |  | 0.4 |  |  | 0.4 |
Financial assurance instruments |  |  |  |  | 7.2 |  |  | 8.8 |
Amortization of debt issuance costs |  |  |  |  | 1.4 |  |  | 1.2 |
Receivables securitization program |  |  |  |  | 0.6 |  |  | 0.8 |
Capitalized interest |  |  |  |  | (2.2) |  |  | — |
Other |  |  |  |  | 1.5 |  |  | 0.9 |
Interest expense, net of capitalized interest |  |  |  |  | $ | 11.5 |  |  | $ | 14.7 |
Cash paid for interest, net of capitalized interest |  |  |  |  | $ | 9.9 |  |  | $ | 11.5 |
Non-cash interest expense |  |  |  |  | $ | 1.6 |  |  | $ | 1.3 |
Covenant Compliance The Company was compliant with all relevant covenants under its debt and other finance agreements at March 31, 2025.

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