Shares of Warrior Met Coal (HCC 1.56%) plunged as much as 23.1% in trading on Thursday after the company reported fourth-quarter 2020 financial results. Shares closed down 22.6% for the day.
Revenue was up a modest 3.6% versus a year ago, but the company reported a $33.7 million net loss, or $0.66 per share. A year ago, net income was $20.8 million. On an adjusted basis, which pulls out one-time items, the net loss was $0.63 per share, which was well short of the $0.33 loss that analysts expected.
Management blamed low steel production and weak met coal pricing for the poor results. And with the pandemic continuing and a Chinese ban on Australian coal still in place, they're not giving guidance for 2021, either.
There isn't a lot to like about the metallurgical coal business right now. Spending on steel has slowed, and China has tried to regain its control of the market. It's possible that demand and pricing will improve in 2021 if the economy gets better, but that's only a speculative bet right now. What investors are seeing is weak demand and another bad quarter for coal stocks.