Alpha Natural Resources Inc. (ANR) swung to a second-quarter
loss on high acquisition expenses, masking strong metallurgical
coal revenue growth.
The company also projected full-year total shipment volumes
including the contribution of acquired legacy operations from
Massey Energy Co. of 104 million to 112 million tons.
Alpha completed its acquisition of rival Massey in June for $7.1
billion, becoming the world's third-largest producer of
metallurgical coal. Alpha inherits extensive reserves of the
high-margin coal as well as several lawsuits related to the
explosion at Massey's Upper Big Branch mine in West Virginia that
killed 29 workers last year.
Alpha posted a loss of $56.4 million, or 36 cents a share,
compared with a year-earlier profit of $38.8 million, or 32 cents a
share. Excluding items merger-related expenses, write-downs and
other items, adjusted earnings from continuing operations were 96
cents. The most recent period included the impact of $254.4 million
in merger-related expenses as well as $26 million in additional
expenses, partially offset by a $54.1 million income tax benefit.
Revenue rose 59% to $1.59 billion.
Analysts polled by Thomson Reuters most recently forecast
earnings of $1.08 on revenue of $1.51 billion.
Overall costs rose 72%.
Tons sold from continuing operations rose 14%. Revenue from
metallurgical operations doubled to become the company's largest
contributor to the top line as sales volume rose 34% and average
realized prices rose 50%. Eastern steam revenue rose 31% as sales
volume was up 30% and prices edged up 0.8%.
Shares closed at $40.08 Wednesday and were inactive premarket.
The stock is down 33% year-to-date.
-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287; nathalie.tadena@dowjones.com