JSW sinks most since 2023 as coal miner faces cash shortage

Shares in Poland’s largest coking coal producer JSW SA dropped after the firm said it may run out of cash in six months without external help and its auditor refused to sign off on the conclusions of its latest results.

State-controlled JSW, whose net loss shrank to to 2.09 billion zloty ($574 million) in the first half of 2025 from 6 billion a year earlier, is suffering from a high wage bill amid unfavorable market conditions for its output, which is used in steel manufacturing. The stock fell as much as 9.9% on Tuesday, the most since late 2023.

The Jastrzebie Zdroj-based company has almost used up its entire rainy-day fund and introduced efficiency measures to raise cash, but they turned out to be insufficient. The firm’s auditor said that JSW’s assumptions regarding continued operations over the next 12 months depend too much on actions by third parties.

“Low coal prices combined with persistently unfavorable exchange rates have had a significant impact on the company’s financial situation,” chief executive officer Ryszard Janta said in an emailed statement. “We are taking all possible strategic and operational measures to maintain and improve our financial liquidity.”

Addressing concerns by auditor PricewaterhouseCoopers, JSW said it needs favorable decisions from the government, trade unions and the social security office, among others, to avoid losing liquidity next year. The company seeks to regain windfall taxes it had paid in past years as well as state help with payroll duties.

The Polish government has been subsidizing unprofitable thermal coal producers in a bid to maintain local production of the main fuel needed for electricity generation. At the same time, coking coal producers, which supply steelmakers, had been able to stay profitable amid higher prices of the product.

However, with the coking coal market under pressure from Indonesian imports and European steel producers cutting local output, JSW can no longer afford to maintain its wage bill, which grew amid the market boom in 2022.

“The company’s situation is very difficult, especially that the rainy-day fund will soon dry out,” acting chief financial officer Boguslaw Oleksy said at an earnings conference on Tuesday. “Declining mining cash cost is a positive factor, but it’s not enough. We need to start a deep cost restructuring.”

The stock traded 8.3% lower at 23.18 zloty as of 11:51 a.m. in Warsaw, curbing its year-to-date advance to 12%.

(By Maciej Martewicz)