NACCO Industries, Inc.

Consolidated revenues were $72.3 million, up 6% from $68.2 million a year ago. Gross profit was $15.2 million, up 123% from $6.8 million, and consolidated adjusted EBITDA rose 72% to $15.9 million from $9.3 million. GAAP operating loss was $2.3 million versus an operating loss of less than $100,000 last year; net loss was $1 million, or $0.13 per diluted share, versus net income of $3.3 million, or $0.44 per diluted share, in the prior-year quarter. The quarter included $12 million of solar-related impairment charges. At June 30, 2026, debt was $120.1 million, liquidity was $114.6 million, including $45.5 million of cash and $69.1 million of revolver availability. Forward outlook: Utility Coal Mining full-year operating profit is expected to increase year over year, but second-half results at Mississippi Lignite are expected to decline from the first half due to lower customer demand, higher diesel costs and an anticipated inventory impairment charge. Contract Mining is expected to deliver substantial year-over-year growth in second-half and full-year 2026 operating profit and adjusted EBITDA, though second-half results should moderate from the strong first half. Minerals and Royalties is expected to decline in the second half and full year versus 2025, while full-year 2026 consolidated adjusted EBITDA is still expected to improve year over year, even as second-half operating profit and net income are expected to be lower than in 2025.

J.C. Butler said the quarter showed “meaningful progress” in the operating businesses and emphasized that the company’s established mining and natural resources platforms are performing well. He framed the solar impairments as a deliberate reset after costs, delays and grid-connection issues worsened, and said NACCO is pursuing options such as asset sales and contract amendments to preserve value and limit future capital needs. His tone was disciplined and defensive on capital allocation, repeatedly stressing long-term value creation, heightened scrutiny on non-core investments and prioritizing liquidity and debt reduction.

Elizabeth Loveman said the underlying businesses produced strong year-over-year profit improvement, but GAAP results were distorted by the solar charges. She cited the key figures: $72.3 million in revenue, $15.2 million in gross profit, $2.3 million operating loss, $1 million net loss, and $15.9 million adjusted EBITDA, plus $120.1 million of debt and $114.6 million of total liquidity at quarter-end. On cash, she said cash flow before financing is expected to remain a use of cash in 2026 because of planned investment activity, though cash generated from operations should rise moderately and cash flow before financing should improve modestly over 2025 and continue improving into 2027.

The main analyst focus was Mississippi Lignite: why demand can weaken despite broader electricity demand, how planned and unplanned plant outages affect results, and whether TVA dispatch decisions and tax-law distortions are affecting the plant’s run time. Butler explained that second-quarter weakness was tied to a significant unplanned outage plus dispatch timing, and said the company’s outlook is based on customer indications that can change. Another topic was the delayed receivable; Butler said NACCO is actively enforcing its contractual rights, but would not discuss legal strategy. The analyst also asked about customer concentration in Contract Mining and reinvestment priorities; management said the customer base is expanding through existing relationships and new projects, but they still prefer a diversified portfolio of businesses and investments.