SunCoke Energy (NYSE:SXC) is a large producer of coking coal. Coke is used as a raw material in the steel making process. SunCoke operates coal mines as well as coke making facilities in the United States and in Brazil. SunCoke sells its coke to steel manufacturing companies, in particular ArcelorMittal (MT), US Steel (X), and AK Steel Holding (AKS) through long-term contracts. SunCoke sells approximately 69% of its coke to ArcelorMittal.
For the full year 2010, SunCoke reported a total revenue of $1.3B. This compares to a total revenue of $1.1B in 2009. The company's net income was $139M in 2010 and $190M in 2009.
The company's initial public offering of stock on the NYSE occurred on July 20, 2011. The company offered 11.6M shares each for $16. This was within the initial price range of $15-$17. The deal raised a total of $186M. The lead underwriters were Bank of America (BAC), Credit Suisse Group (CS), and Goldman Sachs Group (GS).
SunCoke receives approximately 69% of its revenue from SunCoke, and nearly all of its sales are through long-term contracts. As a result, if its cost to produce the agreed levels of coke rise, it may no longer be able to profitably fulfill the contract. This may arise from decreases in supply of coal or the increase in demand for coal which may pull away coal resources. However, if the prices for coal drop during its long-term contracts, SunCoke may be able to gain disproportionately.