ST. LOUIS, April 21, 2015 /PRNewswire/ --
Earnings
Highlights
|
|
|
Quarter
Ended
|
In $ millions,
except per share data
|
|
3/31/15
|
|
3/31/14
|
Revenues
|
|
$677.0
|
|
$736.0
|
Loss from
Operations
|
|
(19.7)
|
|
(73.1)
|
Net
Loss
|
|
(113.2)
|
|
(124.1)
|
Diluted
LPS
|
|
(0.53)
|
|
(0.59)
|
Adjusted Diluted
LPS 1
|
|
(0.54)
|
|
(0.60)
|
Adjusted EBITDA
1
|
|
$81.8
|
|
$27.6
|
1/- Defined and
reconciled under "Reconciliation of non-GAAP
measures."
|
|
Arch Coal, Inc. (NYSE: ACI) today reported a net loss of
$113 million, or $0.53 per diluted share, in the first quarter of
2015 compared with a net loss of $124
million, or $0.59 per diluted
share, in the first quarter of 2014. Revenues totaled $677 million for the three months ended
March 31, 2015 and adjusted earnings
before interest, taxes, depreciation, depletion and amortization
("adjusted EBITDA") was $82 million,
a threefold increase as compared to the prior-year quarter.
"Our first quarter 2015 results reflect another strong operating
performance with improved adjusted EBITDA generation over the
prior-year period," said John W.
Eaves, Arch's president and chief executive officer. "We
continue to take proactive steps to reinforce our operational and
financial flexibility. These actions are positioning us to maneuver
through both near-term and long-term market challenges by
optimizing our low-cost asset base, being market responsive,
controlling costs and managing liquidity."
Financial Position
As of March 31, 2015, Arch had
available liquidity of $1.1 billion,
including cash and short-term investments of $939 million and undrawn borrowings on its credit
facilities. "We are focused on managing our available liquidity
through these difficult conditions," said John T. Drexler, Arch's senior vice president
and chief financial officer. "As part of an ongoing review of our
costs, we again reduced our capital and administrative spending
during the three months ended March 31,
2015, enabling us to lower spending expectations for full
year 2015."
Core Values
Arch made continued progress toward the company's ultimate goal
of a Perfect Zero – a dual goal of operating without a
reportable safety incident or environmental violation – with five
operations achieving this high operating standard in the first
quarter of 2015. The company also reported an improved total
incident rate for the three months ended March 31, 2015 over the previous quarter and
advanced its environmental compliance record.
In addition, Arch subsidiaries were honored with several state
awards during the first quarter for outstanding safety and
environmental practices. In February, the West Elk mine was
recognized as the safest underground coal mine in Colorado for the sixth consecutive year – a
record unmatched by any other large underground coal mine in
Colorado.
"We are off to another year of strong safety and environmental
performance," said Paul A. Lang,
Arch's executive vice president and chief operating officer. "We
commend our employees for their many achievements and are proud of
their unwavering dedication to our core values."
Operational Results
"Despite lower shipment levels in the first quarter of 2015 when
compared to the previous quarter, we increased cash margins by more
than 20 percent in our Appalachian and Powder River Basin
segments," said Lang. "Driven by a strong operating performance,
our Appalachian region reported its lowest cost performance in four
years, allowing us to lower our annual cost guidance for the
region."
|
Arch Coal,
Inc.
|
|
|
1Q15
|
|
|
4Q14
|
|
|
1Q14
|
|
|
|
|
|
|
|
|
|
Tons sold (in
millions)
|
|
33.1
|
|
|
35.2
|
|
|
31.4
|
Average sales price
per ton
|
|
$19.18
|
|
|
$19.82
|
|
|
$20.09
|
Cash cost per
ton
|
|
$15.43
|
|
|
$16.46
|
|
|
$18.39
|
Cash margin per
ton
|
|
$3.75
|
|
|
$3.36
|
|
|
$1.70
|
Total operating cost
per ton
|
|
$18.55
|
|
|
$19.45
|
|
|
$21.70
|
Operating margin
per ton
|
|
$0.63
|
|
|
$0.37
|
|
|
($1.61)
|
|
|
|
|
|
|
|
|
|
Consolidated
results may not tie to regional breakout due to exclusion of other
assets, rounding.
|
Cash cost per ton
is defined and reconciled under "Reconciliation of non-GAAP
measures".
|
Operating cost per
ton is the sum of cash costs and depreciation,
depletion
|
and amortization
expense divided by tons sold.
|
On a consolidated basis, Arch earned $3.75 per ton in cash margin in the first quarter
of 2015 compared with $3.36 per ton
in the fourth quarter of 2014, reflecting higher realizations
earned in the company's Powder River Basin segment and a strong
cost performance in its Appalachian segment. Consolidated sales
price per ton decreased slightly over the same time period, but was
more than offset by a 6 percent decline in consolidated cash cost
per ton, reflecting lower cash costs in the Appalachian
segment.
|
Powder River
Basin
|
|
|
1Q15
|
|
|
4Q14
|
|
|
1Q14
|
|
|
|
|
|
|
|
|
|
Tons sold (in
millions)
|
|
28.5
|
|
|
29.3
|
|
|
25.7
|
Average sales price
per ton
|
|
$13.48
|
|
|
$12.86
|
|
|
$12.73
|
Cash cost per
ton
|
|
$10.96
|
|
|
$10.81
|
|
|
$11.45
|
Cash margin per
ton
|
|
$2.52
|
|
|
$2.05
|
|
|
$1.28
|
Total operating cost
per ton
|
|
$12.52
|
|
|
$12.32
|
|
|
$12.98
|
Operating margin
per ton
|
|
$0.96
|
|
|
$0.54
|
|
|
($0.25)
|
|
|
|
|
|
|
|
|
|
Cash cost per ton
is defined and reconciled under "Reconciliation of non-GAAP
measures".
|
Operating cost per
ton is the sum of cash costs and depreciation,
depletion
|
and amortization
expense divided by tons sold.
|
|
|
|
|
|
|
|
In the Powder River Basin, first quarter 2015 cash margin per
ton increased 23 percent to $2.52 per
ton versus the fourth quarter of 2014. The improvement was driven
by a 5 percent increase in average sales price, reflecting higher
pricing on contracted tons and a larger percentage of
higher-quality tons in the company's regional volume mix. Cash cost
per ton increased slightly in the quarter just ended, driven
primarily by higher sales sensitive costs, the impact of lower
shipment levels and planned repair and maintenance costs.
|
Appalachia
|
|
|
1Q15
|
|
|
4Q14
|
|
|
1Q14
|
|
|
|
|
|
|
|
|
|
Tons sold (in
millions)
|
|
3.0
|
|
|
3.6
|
|
|
3.6
|
Average sales price
per ton
|
|
$65.23
|
|
|
$69.27
|
|
|
$67.70
|
Cash cost per
ton
|
|
$52.41
|
|
|
$59.37
|
|
|
$65.48
|
Cash margin per
ton
|
|
$12.82
|
|
|
$9.90
|
|
|
$2.22
|
Total operating cost
per ton
|
|
$68.55
|
|
|
$73.48
|
|
|
$80.80
|
Operating margin
per ton
|
|
($3.32)
|
|
|
($4.21)
|
|
|
($13.10)
|
|
|
|
|
|
|
|
|
|
Cash cost per ton
is defined and reconciled under "Reconciliation of non-GAAP
measures".
|
Operating cost per
ton is the sum of cash costs and depreciation,
depletion
|
|
and amortization
expense divided by tons sold.
|
|
|
|
|
|
|
In Appalachia, Arch earned a cash margin of $12.82 per ton in the first quarter of 2015
compared to $9.90 per ton in the
fourth quarter of 2014. Average sales price per ton declined 6
percent over the same time period, reflecting softer pricing on
metallurgical and thermal tons and a lower percentage of
metallurgical tons in the regional sales mix. The $6.96 per ton decrease in cash cost in the
quarter just ended more than offset the drop in the average sales
price and the impact of lower sales volumes. The 12 percent cash
cost decline reflects the strong operational performance in the
region, especially at the Leer mine, and ongoing cost containment
efforts.
|
Bituminous
Thermal
|
|
|
1Q15
|
|
|
4Q14
|
|
|
1Q14
|
|
|
|
|
|
|
|
|
|
Tons sold (in
millions)
|
|
1.6
|
|
|
2.3
|
|
|
2.1
|
Average sales price
per ton
|
|
$33.42
|
|
|
$31.22
|
|
|
$28.64
|
Cash cost per
ton
|
|
$25.00
|
|
|
$21.42
|
|
|
$22.64
|
Cash margin per
ton
|
|
$8.42
|
|
|
$9.80
|
|
|
$6.00
|
Total operating cost
per ton
|
|
$31.21
|
|
|
$25.94
|
|
|
$27.17
|
Operating margin
per ton
|
|
$2.21
|
|
|
$5.28
|
|
|
$1.47
|
|
|
|
|
|
|
|
|
|
Cash cost per ton
is defined and reconciled under "Reconciliation of non-GAAP
measures".
|
Operating cost per
ton is the sum of cash costs and depreciation,
depletion
|
and amortization
expense divided by tons sold.
|
|
|
|
|
|
|
In the Bituminous Thermal region, first quarter 2015 cash margin
decreased to $8.42 per ton versus
$9.80 per ton in the fourth quarter
of 2014, reflecting the impact of a 30 percent decrease in sales
volumes. Average sales price per ton increased 7 percent versus the
prior quarter, reflecting higher pricing on contracted tons and
fewer export shipments. Cash cost per ton increased 17 percent over
the same time period due to the impact of lower volume levels at
the West Elk mine.
Market Trends
The global coal trade remains under significant pressure, as
prevailing seaborne thermal and metallurgical prices have further
softened and supply continues to outpace demand growth in the
international thermal and metallurgical markets. Global steel
production has declined 1 percent since the start of the year,
marked by weakness in Europe and
Asia, and steel capacity factors
in the United States fell below 69
percent in April from 77 percent at the end of 2014.
Given recent market trends, Arch believes industry-wide coal
exports from the United States
will decline below 90 million tons in 2015 compared with 2014
export levels of nearly 100 million tons, with metallurgical
exports accounting for most of the reduction. We expect seaborne
coal markets to rebalance in time as demand grows, new global
supply slows, and previously announced supply rationalizations take
effect.
Arch now expects U.S. coal consumption for power generation to
decline by 80 million tons in 2015 as compared to 2014, due to the
surplus of natural gas and the impact of new environmental
regulations that took effect in April. As a result of these
factors, utility stockpiles increased by an estimated 10 million
tons during the first quarter and are expected to build further
over the course of the year.
Domestic coal supply reductions are counterbalancing demand
declines to some extent. Mine Safety and Health Administration data
suggests that total domestic production decreased by 13 million
tons in the first quarter of 2015 versus the fourth quarter of
2014. Arch expects coal supply reductions to continue and
accelerate as the year progresses.
Company Outlook
Arch now expects thermal sales volumes for 2015 to be in the
range of 120 million to 130 million tons. The company has lowered
its metallurgical coal sales guidance, and now expects to ship
between 6.0 million and 6.8 million tons for 2015. Using this
revised volume guidance, Arch is more than 95% committed on thermal
sales and 75% committed on metallurgical sales for the full
year.
Arch has also reduced its annual cash cost-per-ton guidance
range for its Appalachian segment, while maintaining its cost
outlook for the Powder River Basin. The company has raised the 2015
cash cost-per-ton guidance range for the company's Bituminous
Thermal region to reflect the impact of lower production levels.
"We started the year with a solid sales foundation, and we are
building on that position by proactively adjusting our sales
expectations and managing our exposure by layering in sales as
appropriate to run our mines efficiently," said Eaves. "Looking
ahead, we believe our diversified, low-cost asset portfolio and our
continued focus on controlling the factors we can will enable us to
effectively manage the business through market headwinds."
|
|
|
2015
|
|
2016
|
|
|
|
Tons
|
$ per
ton
|
|
Tons
|
$ per
ton
|
Sales Volume
(in millions tons)
|
|
|
|
|
|
|
|
|
|
|
Thermal
|
|
|
120.0
|
-
|
130.0
|
|
|
|
|
|
|
Met
|
|
|
6.0
|
-
|
6.8
|
|
|
|
|
|
|
Total
|
|
|
126.0
|
-
|
136.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Powder River
Basin
|
|
|
|
|
|
|
|
|
|
|
Committed,
Priced
|
|
|
|
|
105.0
|
|
|
$13.34
|
|
43.8
|
$14.39
|
Committed,
Unpriced
|
|
|
|
2.8
|
|
|
|
|
15.5
|
|
Total
Committed
|
|
|
|
|
107.8
|
|
|
|
|
59.3
|
|
Average Cash
Cost
|
|
|
|
|
|
$10.50
|
-
|
$11.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appalachia
|
|
|
|
|
|
|
|
|
|
|
|
Committed, Priced
Thermal
|
|
|
|
5.3
|
|
|
$56.87
|
|
2.0
|
$57.97
|
Committed, Unpriced
Thermal
|
|
|
|
-
|
|
|
|
|
-
|
|
Committed, Priced
Metallurgical
|
|
|
|
4.4
|
|
|
$78.27
|
|
0.7
|
$82.69
|
Committed, Unpriced
Metallurgical
|
|
|
0.5
|
|
|
|
|
0.6
|
|
Total
Committed
|
|
|
|
|
10.2
|
|
|
|
|
3.3
|
|
Average Cash
Cost
|
|
|
|
|
|
$56.75
|
-
|
$59.75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bituminous
Thermal
|
|
|
|
|
|
|
|
|
|
|
Committed,
Priced
|
|
|
|
|
6.0
|
|
|
$33.60
|
|
2.8
|
$34.61
|
Committed,
Unpriced
|
|
|
|
0.5
|
|
|
|
|
-
|
|
Total
Committed
|
|
|
|
|
6.5
|
|
|
|
|
2.8
|
|
Average Cash
Cost
|
|
|
|
|
|
$23.00
|
-
|
$26.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate (in $
millions)
|
|
|
|
|
|
|
|
|
|
|
D,D&A
|
|
|
|
|
|
$410
|
-
|
$440
|
|
|
|
S,G&A
|
|
|
|
|
|
$112
|
-
|
$118
|
|
|
|
Interest
Expense
|
|
|
|
|
|
$385
|
-
|
$395
|
|
|
|
Capital
Expenditures
|
|
|
|
|
$140
|
-
|
$155
|
|
|
|
Liqudated
Damages
|
|
|
|
|
$50
|
-
|
$60
|
|
|
|
A conference call regarding Arch Coal's first quarter 2015
financial results will be webcast live today at 10 a.m. Eastern time. The conference call can be
accessed via the "investor" section of the Arch Coal website
(http://investor.archcoal.com).
U.S.-based Arch Coal, Inc. is one of the world's top coal
producers for the global steel and power generation industries,
serving customers on five continents. Its network of mining
complexes is the most diversified in the
United States, spanning every major coal basin in the
nation. The company controls more than 5 billion tons of
high-quality metallurgical and thermal coal reserves, with access
to all major railroads, inland waterways and a growing number of
seaborne trade channels. For more information, visit
www.archcoal.com.
Forward-Looking Statements: This press release contains
"forward-looking statements" – that is, statements related to
future, not past, events. In this context, forward-looking
statements often address our expected future business and financial
performance, and often contain words such as "expects,"
"anticipates," "intends," "plans," "believes," "seeks," or "will."
Forward-looking statements by their nature address matters that
are, to different degrees, uncertain. For us, particular
uncertainties arise from changes in the demand for our coal by the
domestic electric generation industry; from legislation and
regulations relating to the Clean Air Act and other environmental
initiatives; from operational, geological, permit, labor and
weather-related factors; from fluctuations in the amount of cash we
generate from operations; from future integration of acquired
businesses; and from numerous other matters of national, regional
and global scale, including those of a political, economic,
business, competitive or regulatory nature. These uncertainties may
cause our actual future results to be materially different than
those expressed in our forward-looking statements. We do not
undertake to update our forward-looking statements, whether as a
result of new information, future events or otherwise, except as
may be required by law. For a description of some of the risks and
uncertainties that may affect our future results, you should see
the risk factors described from time to time in the reports we file
with the Securities and Exchange Commission.
Arch Coal, Inc.
and Subsidiaries
|
Condensed
Consolidated Statements of Operations
|
(In thousands,
except per share data)
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
|
(Unaudited)
|
|
|
|
|
Revenues
|
$ 677,005
|
|
$ 735,971
|
|
|
|
|
Costs, expenses
and other operating
|
|
|
|
Cost of
sales
|
562,322
|
|
686,314
|
Depreciation,
depletion and amortization
|
104,874
|
|
104,423
|
Amortization of
acquired sales contracts, net
|
(3,390)
|
|
(3,696)
|
Change in fair value
of coal derivatives and coal trading activities, net
|
1,220
|
|
914
|
Selling, general and
administrative expenses
|
22,605
|
|
29,136
|
Other operating
(income) expense, net
|
9,086
|
|
(7,998)
|
|
696,717
|
|
809,093
|
|
|
|
|
Loss from
operations
|
(19,712)
|
|
(73,122)
|
|
|
|
|
Interest expense,
net
|
|
|
|
Interest
expense
|
(99,252)
|
|
(96,471)
|
Interest and
investment income
|
2,373
|
|
1,843
|
|
(96,879)
|
|
(94,628)
|
|
|
|
|
Loss before income
taxes
|
(116,591)
|
|
(167,750)
|
Benefit from income
taxes
|
(3,396)
|
|
(43,611)
|
|
|
|
|
Net
loss
|
$(113,195)
|
|
$(124,139)
|
|
|
|
|
Net loss per
common share
|
|
|
|
Basic and diluted LPS
- Net loss
|
$ (0.53)
|
|
$ (0.59)
|
|
|
|
|
Basic and diluted
weighted average shares outstanding
|
212,660
|
|
212,171
|
|
|
|
|
Dividends declared
per common share
|
$
-
|
|
$ 0.01
|
|
|
|
|
Adjusted EBITDA
(A)
|
$ 81,772
|
|
$ 27,605
|
Adjusted diluted
Loss per common share (A)
|
$ (0.54)
|
|
$ (0.60)
|
|
(A) Adjusted EBITDA
and Adjusted diluted Loss per common share are defined and
reconciled under "Reconciliation of Non-GAAP Measures" later in
this release.
|
Arch Coal, Inc.
and Subsidiaries
|
Condensed
Consolidated Balance Sheets
|
(In
thousands)
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
2015
|
|
2014
|
|
(Unaudited)
|
Assets
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$ 689,972
|
|
$ 734,231
|
Short term
investments
|
249,518
|
|
248,954
|
Trade accounts
receivable
|
198,314
|
|
211,506
|
Other
receivables
|
15,435
|
|
20,511
|
Inventories
|
240,113
|
|
190,253
|
Prepaid
royalties
|
12,841
|
|
11,118
|
Deferred income
taxes
|
50,414
|
|
52,728
|
Coal derivative
assets
|
14,777
|
|
13,257
|
Other current
assets
|
59,605
|
|
60,193
|
Total current
assets
|
1,530,989
|
|
1,542,751
|
|
|
|
|
Property, plant
and equipment, net
|
6,371,335
|
|
6,453,458
|
|
|
|
|
Other
assets
|
|
|
|
Prepaid
royalties
|
63,622
|
|
66,806
|
Equity
investments
|
225,030
|
|
235,842
|
Other noncurrent
assets
|
123,964
|
|
130,866
|
Total
other assets
|
412,616
|
|
433,514
|
Total
assets
|
$8,314,940
|
|
$ 8,429,723
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$ 167,480
|
|
$ 180,113
|
Accrued expenses and
other current liabilities
|
321,503
|
|
302,396
|
Current maturities of
debt
|
34,368
|
|
36,885
|
Total current
liabilities
|
523,351
|
|
519,394
|
Long-term
debt
|
5,117,982
|
|
5,123,485
|
Asset retirement
obligations
|
404,844
|
|
398,896
|
Accrued pension
benefits
|
14,436
|
|
16,260
|
Accrued
postretirement benefits other than pension
|
34,453
|
|
32,668
|
Accrued workers'
compensation
|
98,683
|
|
94,291
|
Deferred income
taxes
|
419,064
|
|
422,809
|
Other noncurrent
liabilities
|
141,804
|
|
153,766
|
Total
liabilities
|
6,754,617
|
|
6,761,569
|
|
|
|
|
Stockholders'
equity
|
|
|
|
Common
Stock
|
2,145
|
|
2,141
|
Paid-in
capital
|
3,050,216
|
|
3,048,460
|
Treasury stock, at
cost
|
(53,863)
|
|
(53,863)
|
Accumulated
deficit
|
(1,445,020)
|
|
(1,331,825)
|
Accumulated other
comprehensive income
|
6,845
|
|
3,241
|
Total
stockholders' equity
|
1,560,323
|
|
1,668,154
|
Total liabilities and
stockholders' equity
|
$ 8,314,940
|
|
$ 8,429,723
|
Arch Coal, Inc.
and Subsidiaries
|
Condensed
Consolidated Statements of Cash Flows
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
|
(Unaudited)
|
Operating
activities
|
|
|
|
Net loss
|
$(113,195)
|
|
$(124,139)
|
Adjustments to
reconcile to cash provided by operating activities:
|
|
|
|
Depreciation,
depletion and amortization
|
104,874
|
|
104,423
|
Amortization of
acquired sales contracts, net
|
(3,390)
|
|
(3,696)
|
Prepaid royalties
expensed
|
1,674
|
|
1,803
|
Employee stock-based
compensation expense
|
1,760
|
|
2,333
|
Gains on disposals
and divestitures
|
(46)
|
|
(15,129)
|
Amortization relating
to financing activities
|
6,219
|
|
3,236
|
Changes
in:
|
|
|
|
Receivables
|
18,252
|
|
(27,245)
|
Inventories
|
(49,860)
|
|
7,441
|
Accounts
payable, accrued expenses and other current liabilities
|
7,186
|
|
43,989
|
Income taxes,
net
|
40
|
|
(115)
|
Deferred income
taxes
|
(3,433)
|
|
(43,698)
|
Other
|
25,646
|
|
10,522
|
Cash provided by
(used in) operating activities
|
(4,273)
|
|
(40,275)
|
|
|
|
|
Investing
activities
|
|
|
|
Capital
expenditures
|
(22,880)
|
|
(14,454)
|
Additions to prepaid
royalties
|
(213)
|
|
(591)
|
Proceeds from
disposals and dispositions
|
46
|
|
28,195
|
Purchases of short
term investments
|
(101,793)
|
|
(119,176)
|
Proceeds from sales
of short term investments
|
99,914
|
|
117,681
|
Investments in and
advances to affiliates, net
|
(1,843)
|
|
(3,242)
|
Cash provided
by (used in) investing activities
|
(26,769)
|
|
8,413
|
|
|
|
|
Financing
activities
|
|
|
|
Payments on term
loan
|
(4,875)
|
|
(4,875)
|
Net payments on other
debt
|
(4,810)
|
|
(4,521)
|
Debt financing
costs
|
—
|
|
(1,957)
|
Dividends
paid
|
—
|
|
(2,123)
|
Withdrawals
(deposits) of restricted cash
|
(3,532)
|
|
—
|
Cash used in
financing activities
|
(13,217)
|
|
(13,476)
|
|
|
|
|
Increase (decrease)
in cash and cash equivalents
|
(44,259)
|
|
(45,338)
|
Cash and cash
equivalents, beginning of period
|
734,231
|
|
911,099
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$ 689,972
|
|
$ 865,761
|
Arch Coal, Inc.
and Subsidiaries
|
Schedule of
Consolidated Debt
|
(In
thousands)
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
|
(Unaudited)
|
|
|
|
|
|
Term loan due 2018
($1.9 billion and $1.93 billion face value,
respectively)
|
|
$ 1,886,971
|
|
$ 1,890,846
|
7.00% senior notes
due 2019 at par
|
|
1,000,000
|
|
1,000,000
|
9.875% senior notes
($375.0 million face value) due 2019
|
|
363,997
|
|
363,493
|
8.00% senior secured
notes due 2019 at par
|
|
350,000
|
|
350,000
|
7.25% senior notes
due 2020 at par
|
|
500,000
|
|
500,000
|
7.25% senior notes
due 2021 at par
|
|
1,000,000
|
|
1,000,000
|
Other
|
|
51,382
|
|
56,031
|
|
|
5,152,350
|
|
5,160,370
|
Less: current
maturities of debt
|
34,368
|
|
36,885
|
Long-term
debt
|
|
$5,117,982
|
|
$ 5,123,485
|
|
|
|
|
|
Calculation of net
debt
|
|
|
|
|
Total debt
|
|
$ 5,152,350
|
|
$ 5,160,370
|
Less liquid
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
689,972
|
|
734,231
|
Short term
investments
|
|
249,518
|
|
248,954
|
|
|
939,490
|
|
983,185
|
Net debt
|
|
$ 4,212,860
|
|
$ 4,177,185
|
Arch Coal, Inc.
and Subsidiaries
|
Reconciliation of
Non-GAAP Measures
|
(In thousands,
except per share data)
|
|
Included in the
accompanying release, we have disclosed certain non-GAAP measures
as defined by Regulation G.
|
The following
reconciles these items to net income and cash flows as reported
under GAAP.
|
|
Adjusted
EBITDA
|
|
Adjusted EBITDA is
defined as net income attributable to the Company before the effect
of net interest expense, income taxes, depreciation, depletion and amortization, and
the amortization of acquired sales contracts. Adjusted
EBITDA may also be adjusted for
items that may not reflect the trend of future results.
|
|
Adjusted EBITDA is
not a measure of financial performance in accordance with generally
accepted accounting principles,
and items excluded from Adjusted EBITDA are significant in
understanding and assessing our financial condition. Therefore, Adjusted EBITDA should not be
considered in isolation, nor as an alternative to net income,
income from operations, cash flows
from operations or as a measure of our profitability, liquidity or
performance under generally accepted accounting principles. We believe that
Adjusted EBITDA presents a useful measure of our ability to incur
and service debt based on ongoing
operations. Furthermore, analogous measures are used by industry
analysts to evaluate our operating
performance. In addition, acquisition related expenses are excluded
to make results more comparable between periods. Investors should be aware that
our presentation of Adjusted EBITDA may not be comparable to
similarly titled measures used by other
companies. The table below shows how we calculate Adjusted
EBITDA.
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
|
(Unaudited)
|
Net loss
|
$ (113,195)
|
|
$ (124,139)
|
Income tax (benefit)
expense
|
(3,396)
|
|
(43,611)
|
Interest expense,
net
|
96,879
|
|
94,628
|
Depreciation,
depletion and amortization
|
104,874
|
|
104,423
|
Amortization of
acquired sales contracts, net
|
(3,390)
|
|
(3,696)
|
|
|
|
|
Adjusted
EBITDA
|
$ 81,772
|
|
$ 27,605
|
Adjusted net loss
and adjusted diluted loss per share
|
|
|
|
|
|
|
|
|
Adjusted net loss and
adjusted diluted loss per common share are adjusted for the
after-tax impact of acquisition related costs and are not measures of financial
performance in accordance with generally accepted accounting
principles. We believe that
adjusted net loss and adjusted diluted loss per common share better
reflect the trend of our future results by excluding items relating to significant
transactions. The adjustments made to arrive at these measures
are significant in understanding
and assessing our financial condition. Therefore, adjusted
net loss and adjusted diluted loss per share should not be considered in isolation, nor as
an alternative to net loss or diluted loss per common share under
generally accepted accounting
principles.
|
|
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
|
(Unaudited)
|
Net loss
|
$ (113,195)
|
|
$ (124,139)
|
|
|
|
|
Amortization of
acquired sales contracts, net
|
(3,390)
|
|
(3,696)
|
Tax impact of
adjustment
|
1,220
|
|
1,331
|
|
|
|
|
Adjusted net
loss
|
$ (115,365)
|
|
$ (126,504)
|
|
|
|
|
Diluted weighted
average shares outstanding
|
212,660
|
|
212,171
|
|
|
|
|
Diluted loss per
share
|
$
(0.53)
|
|
$
(0.59)
|
|
|
|
|
Amortization of
acquired sales contracts, net
|
(0.02)
|
|
(0.02)
|
Tax impact of
adjustments
|
0.01
|
|
0.01
|
Adjusted diluted loss
per share
|
$
(0.54)
|
|
$
(0.60)
|
Cash costs per
ton
|
|
Cash costs per ton
exclude the costs of depreciation, depletion and amortization and
pass-through transportation costs, and may be adjusted for other
items that, due to accounting rules, are classified in "other
income/expense" on the statement of operations, but relate directly
to the costs incurred to produce coal. Cash costs per ton are not
measures of financial performance in accordance with generally
accepted accounting principles. We believe cash costs per ton
better reflect our controllable costs and our operating results by
including all cash costs incurred to produce coal. The adjustments
made to arrive at these measures are significant in understanding
and assessing our financial condition. Therefore, cash costs
per ton should not be considered in isolation, nor as an
alternative to cost of sales per ton under generally accepted
accounting principles.
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
|
(Unaudited)
|
Cost of sales on
condensed consolidated statements of operations
|
$ 562,322
|
|
$ 686,314
|
Transportation costs
billed to customers
|
(43,073)
|
|
(106,959)
|
Settlements of
heating oil derivatives used to manage diesel fuel purchase price
risk
|
1,224
|
|
1,879
|
Other (other
operating segments, operating overhead, land management,
etc.)
|
(9,738)
|
|
(4,689)
|
|
|
|
|
Total cash
costs
|
$ 510,735
|
|
$ 576,545
|
Total tons
sold
|
33,108
|
|
31,357
|
Total cash cost per
ton
|
$
15.43
|
|
$
18.39
|
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SOURCE Arch Coal, Inc.