DIV'D VALUE Median: NMF P/E RATIO 0.34 4.1% LINE RECENT PRICE 160.91 RATIO P/E 6.1 Trailing: 6.7 RELATIVE High: Low: 86.5 94.6 102.6 101.9 75.3 105.6 183.5 175.1 187.6 59.1 60.1 75.1 68.6 21.8 39.0 86.5 102.4 155.3 Target Price Range 2027 2028 2029 ARCH RESOURCES NYSE-ARCH TIMELINESS 3 Lowered 2/16/24 SAFETY 3 New 9/30/22 TECHNICAL 2 Lowered 3/22/24 BETA .75 (1.00 = Market) 18-Month Target Price Range Low-High $78-$221 Midpoint (% to Mid) $150 (-5%) 2027-29 PROJECTIONS Ann'l Total Price Gain Return LEGENDS 4.0 x "Cash Flow" p sh ... Relative Price Strength Options: Yes Shaded area indicates recession -400 -320 -200 -160 120 -100 80 -60 High 265 (+65%) 15% Low 175 -40 (+10%) 5% Institutional Decisions 202023 3Q2023 402023 % TOT. RETURN 2/24 THIS VL ARITH.* STOCK INDEX Percent 120 1 yr. 12.7 10.4 to Buy to Sell 117 137 126 118 141 113 shares traded 80 40 3 yr. 344.2 16.5 Hld's (000) 15592 14862 15437 5 yr. 136.0 63.1 -- Arch Coal, Inc. emerged from Chapter 11 2014 2015 2016 2017 2018 2019 2020 2021 bankruptcy proceedings on October 5, as of 2/1/24 2016. Its prior results are not comparable, and its 2016 results are shown on a pro- forma basis. In May, 2020, the company changed its name to Arch Resources, Inc. The name change came in conjunction with a strategy shift away from thermal coal and a focus on the metallurgical coal markets. CAPITAL STRUCTURE as of 12/31/23 Total Debt $141.7 mill. Due in 5 Yrs $141.7 mill. LT Debt $105.3 mill. LT Interest $14.8 mill. (Total interest coverage: greater than 25x) Leases, Uncapitalized: $3.3 mill. Pension Plan: None Pfd Stock None Common Stock 18,360,691 shares MARKET CAP: $3.0 billion (Mid Cap) ::: 1.31 23.03 110.33 137.50 151.62 96.33 143.44 3.00 21.30 26.66 23.07 d7.32 31.32 9.84 15.15 2022 2023 2024 2025 212.18 171.34 70.76 33.25 VALUE LINE PUB. LLC 27-29 180.95 195.15 Revenues per sh A 242.85 36.95 39.60 "Cash Flow" per sh 50.35 13.52 d15.74 20.58 53.28 24.20 26.75 28.05 Earnings per sh A,B 36.55 -- 1.05 1.60 1.80 .50 .25 1.00 1.00 1.00 1.00 Div'ds Decl'd per sh C 1.50 .61 2.81 29.86 31.60 25.00 21.07 5.34 17.60 18.76 39.53 17.83 15.13 15.24 15.95 9.84 9.59 9.40 9.70 Cap'l Spending per sh 14.30 42.33 18.61 44.43 77.79 80.58 100 109.70 Book Value per sh 161.05 15.39 17.55 18.36 16.00 15.50 Common Shs Outst'g D 14.00 NMF 7.5 5.9 6.2 3.1 2.6 5.8 Bold figures are Avg Ann'l P/E Ratio 6.0 NMF .38 .32 .33 .17 .15 .32 Value Line Relative P/E Ratio .35 estimates -- 1.4% 1.8% 2.1% 1.3% .4% .7% .7% Avg Ann'l Div'd Yield .9% 2895 3025 Revenues (Smill) 3400 22.3% 22.4% Operating Margin 23.1% 150 -- (7% of Capital) 165 Depreciation ($mill) 175 - 450 Net Profit ($mill) 530 -- 14.0% Income Tax Rate 14.8% Net Profit Margin 14.0% 15.6% 620 725 Working Cap'l ($mill) 1000 100 85.0 Long-Term Debt ($mill) 65.0 1600 1700 Shr. Equity ($mill) 2255 1% 25.5% Return on Total Cap'l 26.5% Return on Shr. Equity 25.5% Retained to Com Eq 3% All Div'ds to Net Prof 23.0% 23.5% 22.5% 4% CURRENT POSITION 2021 2022 12/31/23 (SMILL.) Cash Assets Receivables Inventory Other Current Assets 62.2 882.9 339.7 273.1 320.5 324.3 237.0 273.5 156.7 223.0 244.3 79.5 90.8 823.9 823.9 Accts Payable 132.0 211.8 Debt Due 223.1 58.0 167.2 157.1 Current Liab. 426.9 917.8 205.0 36.4 126.6 368.0 Other ANNUAL RATES 522.3 2% 4% tons. 2023 Tons sold: met. coal, 9.3 million tons; thermal coal, 65.7 million tons.Has 3,404 employees. Off.s & dir.s own 5.4% of the common stock; The Vanguard Group, 10.4%; FMR LLC, 7.7%; GQG Partners., 6.2%; BlackRock Inc., 6.0% (3/23 Proxy). CEO: Paul Lang. Inc.: DE. Addr.: 1 City Place Drive, Suite 300 St. Louis, MO 63141. Tel.: 314-994-2700. Internet: www.archrsc.com. lion in cash, and management has stated that it now expects to substantially reduce the number of outstanding shares over the course of 2024. 575.7 2324.6 2451.8 2294.4 1467.6 2208.0 3724.6 3145.8 15.7% 18.4% 18.7% 14.4% .8% 24.3% 34.4% 22.0% 41.5 210.4 162.8 115.3 127.2 120.3 133.3 146.4 33.4 238.5 312.6 233.8 d238.6 361.8 1108.9 464.0 440 3.3% .1% .5% .5% 15.9% 13.5% 5.8% 10.3% 12.7% 10.2% NMF 16.4% 29.8% 14.8% 15.2% 566.4 496.9 549.5 395.8 298.0 360.6 397.0 549.8 351.8 310.1 300.2 290.1 477.2 337.6 116.3 105.3 746.6 665.9 704.8 640.5 283.6 683.9 1365.6 1479.5 3.6% 25.8% 32.1% 26.0% NMF 36.6% 75.5% 29.7% 26.5% 4.5% 35.8% 44.3% 36.5% NMF 52.9% 81.2% 31.4% 27.5% 4.5% 32.2% 39.9% 31.8% NMF 52.3% 79.9% 30.1% 26.5% 10% 10% 13% NMF 4% BUSINESS: Arch Resources mines thermal coal for utilities and metallurgical (met.) coal for the global steel industry. It owns seven mines: Leer, Leer South, Beckley, and Mountain Laurel mines in West Virginia; Black Thunder and Coal Creek mines in Wyoming; and the West Elk mine in Colorado. 2023 Proved/probable reserves: met. coal, 219.9 million tons; thermal coal, 629.6 million Arch Resources is aiming to increase Past Est'd '21-23 its market share for coking coal in the Asian markets. Pricing for coking coal is over $50 a ton higher in Asia than is in the United States. In fact, on the U.S. East Coast coking coal is selling for about $262 per metric ton. Meanwhile, the Aus- tralian Premium Low-Vol index is trading $53 per metric ton higher, creating a strong arbitrage opportunity for export coal. Australian coking coal exports have declined 20% (about 40 million metric tons) since 2016, including a 6% year over year decline in 2023. Looking ahead, we expect this trend to continue due to persis- tent underinvestment in the Australian mines. Mounting regulatory pressures in Australia has led to limited capital availability, and thus production has been declining, leaving a strong opportunity for U.S. and Canadian miners to increase their overseas exports. to '27-'29 Full Year 594.4 805.7 2208.0 863.8 859.5 3724.6 744.6 774.0 3145.8 Past of change (per sh) 10 Yrs. Revenues "Cash Flow" Earnings Dividends Book Value 15.0% 5 Yrs. 14.0% 5.5% 21.5% 2.0% 30.0% 2.0% -3.0% 12.0% 15.5% Cal- QUARTERLY REVENUES ($ mill.) A endar Mar.31 Jun. 30 Sep. 30 Dec. 31 2021 357.5 450.4 2022 867.9 1133.4 2023 869.9 757.3 2024 685 740 720 750 2895 2025 720 775 755 775 3025 Cal- EARNINGS PER SHARE A,B endar Mar.31 Jun. 30 Sep. 30 Dec. 31 2021 d.40 1.66 4.92 13.19 2022 12.89 19.30 8.68 12.23 53.28 2023 10.02 4.04 3.91 6.07 24.20 6.00 2024 7.10 7.20 6.45 26.75 2025 6.35 7.25 7.35 7.10 28.05 Cal- QUARTERLY DIVIDENDS PAID C endar Mar.31 Jun.30 Sep.30 Dec.31 2020 .50 2021 .25 2022 .25 .25 .25 .25 .25 .25 .25 2023 .25 2024 .25 Full Year 20.58 Full Year .25 1.00 1.00 We think Arch will accelerate its .50 share buyback program this year. The company recently retired 315,721 of its outstanding shares via the unwinding of capped calls tied with the retirement of its convertible senior notes. It has $320 mil earnings report due late April. (C) Dividends paid quarterly in mid-March, June, September, and December. Variable dividend payments: '22, $24.11 a share; '23, $9.66; '24, Q1, $1.40. These shares are an Average selection (3) for the year ahead. This stock has a very low Price Stability score (20), making it well suited for momentum traders. Arch Resources' fortunes are highly correlated to movements in the price of metallurgical coal, thus the share price has a tendency to move ahead of any changes in earnings. Furthermore, small changes in expenses can have a magnified impact on share earnings due to the low number of shares outstanding. In fact, for every $1 million change in expenses, share earnings will be impacted by $0.04. This is a large part of the reason that the company has such a low Earnings Predictability score (5 out of 100), and why earnings results have a low probability of matching the consensus es- timate. All told, the share price is current- ly trading near the low end of our 3- to 5- year Target Price Range, thus most inves- tors should remain on the sidelines, for now, and wait for a better entry point. Wayne C. Nef March 29, 2024 Company's Financial Strength Stock's Price Stability Price Growth Persistence Earnings Predictability Variable payments in addition to the set quarterly dividend are now an ongoing part of ARCH's dividend policy. Div'd reinvestment plan available. (D) In millions. (A) In U.S. dollars. Quarters may not add due to change in shares outstanding. (B) Based on dil. shares. Excludes non-recurring gains/(losses): '20, ($7.00); '21, ($1.38). Next 2024 Value Line, Inc. All rights reserved. Factual material is obtained from sources believed to be reliable and is provided without warranties of any kind. B205 40 THE PUBLISHER IS NOT RESPONSIBLE FOR ANY ERRORS OR OMISSIONS HEREIN. This publication is strictly for subscriber's own, non-commercial, internal use. 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