How Much Time Does Peabody’s Cash Buy?

For questions about this article or underlying research, email help@trefis.com.

Peabody Energy (BTU) mines coal. During its fiscal third quarter ended September 30, 2026, the company spent more cash than it brought in. Cash left after running the business and capital spending was negative, and Peabody burned $62.8 million in the quarter. The company has burned cash in each of its last four quarters. Guess first: at that pace, how many quarters would Peabody’s cash last?

How Fast Is Peabody Burning Cash?

Peabody’s burn in the fiscal third quarter equaled 5.7% of its sales. During the same quarter a year earlier, the company brought in cash equal to 1.3% of sales. Over the last four quarters combined, the burn was more than four times that of the four quarters before.

The burn has grown over the past year. Peabody spent less on capital projects in the quarter than it did a year earlier. The burn grew anyway, as cash from running the business turned slightly negative before any capital spending.

How Long Would Peabody’s Cash Last?

Peabody held $434 million of cash on September 30, 2026. This balance would last about seven quarters if the company raised nothing and continued burning cash at the average pace of its last four quarters. The latest quarter’s pace gives the same count. That count leaves out the remaining $40 million of convertible notes Peabody has called for cash settlement. In the third quarter, Peabody paid $58 million to buy back $39 million of these notes, so settling the rest may cost more than face value and shorten the runway to about six quarters. Management said on the November 4 call that closing is expected in mid-November.

Peabody’s debt and lease obligations totaled $374 million, less than its cash. At this pace, the cash covers a year or two, not many years. Management put total liquidity at $887 million at the end of the quarter, about twice its cash.

Who Has Paid For The Burn So Far?

Peabody has not sold new shares to cover the burn, and its basic share count fell 2.2% in the two years to September 30, 2026. It did borrow, but to refinance: in June it issued $250 million of new convertible notes and used the money, with cash, to retire older notes, and its debt and lease obligations ended the two years below the $433 million they started at. Its cash dropped by about 44% over the same two years. Most of what filled the gap was cash that had been tied up as collateral: new surety arrangements freed about $348 million of restricted cash in the first nine months of 2026. Management said Peabody returned $192 million to shareholders in 2026 through September 30, made up of $27 million of dividends and the premium it paid above face value to buy back convertible notes.

What Has To Change At Peabody

The burn has to shrink. On November 4, Peabody said it is anticipating stronger fourth-quarter production and free cash flow, a forecast rather than a result. On the call, management said faulted conditions had slowed production at its Centurion mine, and that most of the faulting in the current panel goes away after about 110 more meters of mining. Management also cut its capital spending guidance for the year by $40 million, mostly by deferring development at Centurion North.

Sales are growing, up 8.3% in the fiscal third quarter from a year earlier. The figure to watch at its next report, expected in February 2027, is the cash Peabody burns each quarter. The company burned $62.8 million in the fiscal third quarter.

What Would Selling Peabody Energy Cost You In Tax?

If you bought long ago, selling can bring a large tax bill, and holding keeps all the risk. A free 30-minute strategy review with our partner advisory firm covers a floor under a large position and a lower-tax way out.

Map My Exit Options

Spot an error or want more like this? Tell us in 10 seconds.