Hallador Rewrites EBITDA Definition Retroactively for Q2 in Third Credit Amendment
Credit Pressure
Company Background
Hallador Energy (Nasdaq: HNRG) is a Terre Haute, Indiana-based vertically integrated independent power producer. Its core assets are the one-gigawatt Merom Generating Station, operated through subsidiary Hallador Power Company, and Sunrise Coal, which mines thermal coal primarily to fuel Merom and sells third-party tonnage. Annual revenue was $469.5 million in 2025, when the company swung to a $41.9 million net profit after a $226 million loss in 2024 driven by asset impairments.
Hallador is in the middle of a large and capital-intensive growth pivot. On May 30, 2026, it signed an asset purchase agreement with Australia's Energy World Corporation to acquire approximately 460 MW of Siemens gas turbines and related equipment for $350 million, a project now formally named Turtle Creek Gas. Management expects total project cost to come in below $800 million and targets commercial operation in the second half of 2028. The company raised $53.6 million in a January 2026 public equity offering and drew the full $45 million delayed draw term loan in May 2026 to help fund the project.
The company also holds $2.4 billion in contracted forward revenue at the segment level through 2040, anchored by a 12-year, $1 billion-plus capacity agreement signed May 1, 2026. But that revenue stream is largely a future event — in the near term, Hallador is burning cash and posting losses.
What Was Disclosed
Hallador entered into a Third Amendment to its Credit Agreement with Texas Capital Bank and the other lenders on August 11, 2026. The amendment modifies the definition of "EBITDA" set forth in the Credit Agreement to, among other things, permit the Company to add back to EBITDA certain payments received by the Company or its restricted subsidiaries in respect of power purchase agreement exclusivity agreements during the fiscal quarter ended June 30, 2026, in an aggregate amount not to exceed $10,000,000. The amendment applies specifically and exclusively to the quarter that had just closed — it is not a prospective change to the EBITDA definition going forward.