ST. LOUIS, Oct. 27, 2015 /PRNewswire/ -- Peabody Energy
(NYSE: BTU) today reported third quarter 2015 revenues of
$1.42 billion and Adjusted EBITDA of
$129.0 million. After taking
into effect the reverse split of common stock that occurred on
Oct. 1, 2015, Diluted Loss Per Share
from Continuing Operations totaled $(8.08) and Adjusted Diluted EPS totaled
$(8.13).
"Peabody's third quarter results reflect a solid operational
performance across the portfolio that continues to limit the
pricing impacts from unprecedented market conditions," said Peabody
Energy President and Chief Executive Officer Glenn Kellow. "Our mining platform is
operating well, and we are balancing our dual financial objectives
of optimizing liquidity in response to the prolonged industry
downturn whilst keeping a strategic eye on deleveraging."
RESULTS FROM CONTINUING OPERATIONS
Third quarter revenues totaled $1.42
billion compared with $1.72
billion in the prior year due to a 7 percent decline in
volume and lower realized pricing. Third quarter Adjusted
EBITDA of $129.0 million reflects
approximately $200 million in lower
operating and administrative costs that mitigated the impact of
nearly $120 million in lower pricing
and $123.7 million in hedging losses.
U.S. Mining Adjusted EBITDA declined $44.3 million to $238.0
million, primarily due to a volume reduction of 2.5 million
tons largely driven by lower natural gas prices and a longwall move
in Colorado. U.S. costs per ton declined 5 percent due to
lower fuel expense, cost reduction initiatives and a higher mix of
PRB volumes, partially offset by higher overburden ratios.
Third quarter PRB margins improved 5 percent to $3.39 as a result of higher revenues per ton on
shipment mix and lower fuel prices.
Australian Mining Adjusted EBITDA increased $24.6 million to $34.0
million in the third quarter, as nearly $150 million in cost improvements overcame
approximately $110 million in lower
pricing. Australian costs per ton improved 28 percent to
$48.11, a record low for this
platform, which includes the benefit of lower currency and fuel
rates, productivity improvements, workforce reductions and
operational changes implemented in the second quarter.
Australian volumes totaled 9.3 million tons, including 4.0 million
tons of metallurgical coal at an average realized price of
$68.53 and 3.3 million tons of export
thermal coal at $52.97 per ton, with
the remaining 2.0 million tons delivered under domestic thermal
contracts.
Trading and Brokerage Adjusted EBITDA totaled $29.4 million compared to $3.3 million in the prior year and reflects
favorable trading activities primarily around the company's
New South Wales thermal coal
positions settled in the third quarter and approximately
$7 million in litigation settlement
benefit.
Peabody's third quarter income tax provision improved
$72.5 million to $6.9 million
primarily due to the repeal of the Australian Minerals Resource
Rent Tax in 2014. Loss from Continuing Operations totaled
$(144.4) million compared to
$(154.0) million in the prior
year. Diluted Loss from Continuing Operations totaled
$(8.08) per share and Adjusted
Diluted EPS totaled $(8.13).
Loss from Discontinued Operations totaled $157.5 million, primarily as a result of a
$155.1 million charge related to
Patriot Coal black lung and Combined Benefit Fund Coal Act
liabilities, with expected cash payments to occur over a number of
years.
Third quarter operating cash flow of $(34.2) million includes $88.6 million related to interest payments, while
capital spending totaled $26.0
million. Liquidity totaled $1.81 billion at the end of September, which
included $334.3 million in cash and
$1.42 billion available under the
company's fully committed credit facility. Liquidity declined
$246.8 million during the quarter
primarily due to providing approximately $195 million in letter-of-credit support for
existing surety bonds and bank guarantees, as well as completing
$89.3 million in PRB reserve
installments. Peabody has $187.6
million in PRB reserve installments and $135.7 million in interest payments remaining in
the fourth quarter. The company is actively monitoring
liquidity and any additional collateral required to support surety
bonds, bank guarantees and other obligations.
Regarding the company's $1.47
billion in self-bonding obligations as of Sept.
30, Peabody continues to qualify for self-bonding in all
relevant states, has no collateral related to these obligations and
recently received approval to continue self-bonding in New
Mexico.
GLOBAL COAL MARKETS
The broader commodity sector declined in the third quarter on
concerns over slowing global growth and economic weakness in
China. This resulted in a reduction in global coal demand
that more than offset recent supply reductions and pressured
seaborne coal prices.
Seaborne metallurgical coal markets have been impacted by a 5
percent decline in domestic Chinese steel consumption through
September as a result of a slowing economy and excess supply in the
property sector. Chinese steel exports increased 27 percent
to 83 million tons through September, and has reduced metallurgical
coal demand in other regions. As a result, the fourth quarter
metallurgical coal benchmark for premium hard coking coal declined
4 percent to $89 per tonne, and the
benchmark for low-vol PCI eased from $73 to $71 per
tonne, both the lowest levels since 2004.
In seaborne thermal markets, India has surpassed China as the largest thermal coal
importer. India's 18 million
tonne year-to-date increase in thermal coal imports has not been
enough to offset China's 59
million tonne decline through September. Chinese imports
declined primarily from reduced coal generation demand, an increase
in hydroelectric generation and protectionist policies that support
domestic coal producers.
Industry reports estimate that over 80 percent of seaborne
metallurgical coal supply is not covering cash costs at current
pricing, and Peabody projects 2015 seaborne metallurgical coal
supply to decline 15 million tonnes to 295 million tonnes.
U.S. metallurgical coal exports fell 17 percent through September
and are expected to decline 10 to 15 million tons in 2015.
Australian metallurgical exports have modestly increased compared
with 2014 levels and benefit from lower currency, while domestic
Chinese coal production is down 5 percent. Cutbacks have
accelerated in the seaborne thermal market, particularly in the
U.S. and Indonesia, where exports
are down 39 percent and 8 percent, respectively.
Peabody expects additional coal production curtailments in
response to current prices. In addition, limited capital
spending is anticipated to act as a future supply constraint.
Industry reports indicate a 70 percent decline in capital
investment from the top coal producers from recent highs in
2012. The company anticipates that coal prices will need to
rise well above current levels to incentivize new investment to
maintain adequate supply to meet seaborne demand over
time.
Within U.S. coal markets, Peabody now projects utility coal
demand to decline approximately 100 million tons in 2015, primarily
due to lower natural gas prices, with coal's share of U.S.
electricity generation expected to be 35 percent. U.S. coal
shipments are projected to decline 90 million tons this year, and
additional production cutbacks are expected. The largest
share of production decreases is occurring in coal regions outside
of the PRB, where demand pressures are the greatest. The
reduction in demand has currently outpaced the supply response,
resulting in rising stockpiles totaling approximately 75 days of
supply in the PRB and approximately 90 days in the Illinois
Basin.
Peabody expects 2016 utility coal consumption to be below 2015
levels based on current natural gas prices and expected plant
closures; these factors more than offset higher capacity
utilization within the remaining U.S. coal fleet. Over the
next few years, the company projects rising coal demand over 2015
levels as natural gas prices increase on growing LNG exports,
onshore demand and pipeline exports to Mexico. The PRB
remains most competitive with natural gas and is expected to
represent a greater share of the U.S. coal generation profile in
coming years due to its delivered cost advantages and emissions
benefits.
PEABODY OPERATIONS WELL POSITIONED; ADVANCING FOUR AREAS OF
EMPHASIS
"Peabody benefits from an unmatched global asset base, strong
underlying operational performance and our mines are strategically
positioned to access the best markets," said Kellow. "The
company continues to navigate the current environment with a fresh
perspective and an intense focus on the operational,
organizational, portfolio and financial areas of our business."
- Operational: Peabody is benefitting from recent cost
reduction initiatives while transforming operations to respond to
market conditions. These initiatives have allowed the company to
reduce its annual Australian metallurgical coal production while
lowering unit costs by modifying production plans and increasing
productivity. The company's operational results reflect consistent
performance with four out of five operating segments reporting
average gross margins of 26 percent in the third quarter.
- Organizational: The company has successfully completed a
series of actions aimed at creating a leaner organizational
structure at the administrative level, including salaried workforce
reductions, streamlined reporting, activity consolidation and
shared service development. As a result of these initiatives, third
quarter SG&A declined 29 percent year-over-year and reached the
lowest level in nearly a decade.
- Portfolio: Peabody has a substantial asset base that
provides option value to hold for development, transfer into joint
venture opportunities or monetize. The company evaluates potential
asset sales through several criteria including strategic fit, value
consideration, potential growth and cash requirements. Peabody is
currently advancing multiple asset sale processes, which includes
non-core assets and certain operating mines.
- Financial: The company continues to focus on optimizing
liquidity in light of ongoing business requirements and potential
collateral obligations while pursuing deleveraging. Peabody's
potential avenues for deleveraging include asset sales, continued
focus on cash outlays from cost or capital management, rising cash
flow from any eventual market improvements, and potential debt
buybacks or exchanges. In addition, Peabody recently implemented a
reverse stock split of the company's common stock following
approval by approximately 90 percent of voted shares.
OUTLOOK
Peabody's 2015 U.S. production is fully priced with 2016 U.S.
production approximately 15 percent unpriced based on assumed 2016
production levels, which are expected to be modestly below revised
2015 targets. Peabody now has 113 million tons of PRB priced
at an average of $13.67 for 2016
delivery.
After working with customers to defer shipments into 2016, the
company reduced 2015 U.S. sales volumes by 5 million tons.
2015 Australian costs per ton are now targeted to be nearly 25
percent below 2014 levels as a result of lower currency, fuel
rates, productivity improvements and operational changes.
Peabody also expects 2015 capital spending and Selling and
Administrative Expense to be approximately 25 percent lower than
2014 levels.
Compared with the third quarter, fourth quarter Adjusted EBITDA
is expected to reflect reduced Trading and Brokerage results and
lower seaborne metallurgical and thermal coal pricing.
|
New
2015 Guidance
|
Prior Guidance
(where changed)
|
Sales Volumes
(in million tons)
|
|
|
U.S.
|
175 – 185
|
180 – 190
|
Australia
|
35 – 36
|
34 – 36
|
Trading &
Brokerage
|
12 – 16
|
11 – 19
|
Total
|
222 – 237
|
225 – 245
|
|
|
|
U.S.
Operations
|
|
|
Revenue Per Ton (vs
2014)
|
$19.80 –
$20.25
|
$19.95 –
$20.40
|
Costs Per Ton (vs
2014)
|
$14.50 –
$14.85
|
$14.65 –
$15.00
|
|
|
|
Australia
Operations
|
|
|
Metallurgical Coal
Sales
|
~15 million
tons
|
14 – 15 million
tons
|
Export Thermal Coal
Sales
|
12 – 13 million
tons
|
|
Domestic Thermal Coal
Sales
|
8 million
tons
|
Costs Per
Ton
|
$50 – $52
|
$53 – $56
|
|
|
|
Selling &
Administrative Expenses
|
$170 – $175
million
|
$170 – $180
million
|
|
|
|
Depreciation,
Depletion and Amortization
|
$570 – $600
million
|
$580 – $620
million
|
|
|
|
Capital
Expenditures
|
$140 – $150
million
|
$160 – $170
million
|
|
|
|
|
Notes: Peabody
classifies its Australian mines with the Australian Metallurgical
or Thermal Mining segments based on the primary customer base and
reserve type. A small portion of the coal mined by the
Australian Metallurgical Mining segment is of a thermal grade and
vice versa. Also, Peabody may market some of its
metallurgical coal products as a thermal product from time to time
depending on market conditions.
|
The company will complete its remaining PRB reserve installments
of approximately $250 million in 2016
and is scheduled to make its final health benefit trust payments of
$75 million in 2016 and $70 million in 2017. Peabody's existing
currency hedges expire by the end of 2017, as the company has not
placed any currency hedges in over a year. Based on an
estimated A$2.2 billion requirement
in 2015, the company is 46 percent hedged in 2016 and 24 percent
hedged in 2017. Based on an estimated 150 million gallons of
diesel fuel usage in 2015, the company's fuel position is 67
percent hedged in 2016 and 47 percent hedged in 2017.
Peabody Energy is the world's largest private-sector coal
company and a global leader in sustainable mining, energy access
and clean coal solutions. The company serves metallurgical
and thermal coal customers in more than 25 countries on six
continents. For further information, visit PeabodyEnergy.com
and AdvancedEnergyForLife.com.
Certain statements in this press release are forward-looking as
defined in the Private Securities Litigation Reform Act of 1995.
The company uses words such as "anticipate," "believe," "expect,"
"may," "forecast," "project," "should," "estimate," "plan,"
"outlook," "target," "likely," "will," "to be" or other similar
words to identify forward-looking statements. These forward-looking
statements are based on numerous assumptions that the company
believes are reasonable, but they are open to a wide range of
uncertainties and business risks that may cause actual results to
differ materially from expectations as of Oct. 27, 2015. These factors are difficult
to accurately predict and may be beyond the company's control. The
company does not undertake to update its forward-looking
statements. Factors that could affect the company's results
include, but are not limited to: supply and demand for the
company's coal products; price volatility and customer procurement
practices, particularly in international seaborne products and in
the company's trading and brokerage businesses; impact of
alternative energy sources, including natural gas and renewables;
global steel demand and the downstream impact on metallurgical coal
prices; impact of weather and natural disasters on demand,
production and transportation; reductions and/or deferrals of
purchases by major customers and the company's ability to renew
sales contracts; credit and performance risks associated with
customers, suppliers, contract miners, co-shippers, and trading,
banks and other financial counterparties; geologic, equipment,
permitting, site access, operational risks and new technologies
related to mining; transportation availability, performance and
costs; availability, timing of delivery and costs of key supplies,
capital equipment or commodities such as diesel fuel, steel,
explosives and tires; impact of take-or-pay agreements for rail and
port commitments for the delivery of coal; successful
implementation of business strategies, including, without
limitation, the actions we are implementing to improve our
organization and respond to current market conditions; negotiation
of labor contracts, employee relations and workforce availability;
changes in postretirement benefit and pension obligations and their
related funding requirements; replacement and development of coal
reserves; adequate liquidity and the cost, availability and access
to capital and financial markets; ability to appropriately secure
the company's obligations for reclamation, federal and state
workers' compensation, federal coal leases and other obligations
related to our operations, including our ability to remain eligible
for self-bonding and/or successfully access the commercial surety
market; impacts of the degree to which we are leveraged and our
ability to comply with financial and other restrictive covenants in
our credit agreement; effects of changes in interest rates and
currency exchange rates (primarily the Australian dollar); effects
of acquisitions or divestitures; economic strength and political
stability of countries in which the company has operations or
serves customers; legislation, regulations and court decisions or
other government actions, including, but not limited to, new
environmental and mine safety requirements, changes in income tax
regulations, sales-related royalties, or other regulatory taxes and
changes in derivative laws and regulations; any additional
liabilities or obligations that we may have as a result of the
Patriot Coal bankruptcy, including, without limitation, as a result
of litigation filed by third parties in relation to that
bankruptcy; litigation, including claims not yet asserted;
terrorist attacks or security threats, including cybersecurity
threats; impacts of pandemic illnesses; and other risks detailed in
the company's reports filed with the Securities and Exchange
Commission (SEC).
Included in the company's release of financial information
accounted for in accordance with generally accepted accounting
principles (GAAP) are certain non-GAAP financial measures, as
defined by SEC regulations. The company has defined below the
non-GAAP financial measures that are used and has included in the
tables following this release reconciliations of these measures to
the most directly comparable GAAP measures.
Adjusted EBITDA is defined as (loss) income from continuing
operations before deducting net interest expense; income taxes;
asset retirement obligation expenses; depreciation, depletion, and
amortization; asset impairment and mine closure costs; charges for
the settlement of claims and litigation related to previously
divested operations; and changes in deferred tax asset valuation
allowance and amortization of basis difference related to equity
affiliates. Adjusted EBITDA, which is not calculated
identically by all companies, is not a substitute for operating
income, net income or cash flow as determined in accordance with
United States GAAP. Management uses Adjusted EBITDA as the
primary metric to measure segment operating performance and also
believes it is useful to investors in comparing the company's
current results with those of prior and future periods and in
evaluating the company's operating performance without regard to
its capital structure or the cost basis of its assets.
Adjusted (Loss) Income from Continuing Operations and Adjusted
Diluted EPS are defined as (loss) income from continuing operations
and diluted earnings per share from continuing operations,
respectively, excluding the impacts of asset impairment and mine
closure costs and charges for the settlement of claims and
litigation related to previously divested operations, net of tax,
and the remeasurement of foreign income tax accounts on the
company's income tax provision. The company calculates income tax
benefits related to asset impairment and mine closure costs and
charges for the settlement of claims and litigation related to
previously divested operations based on the enacted tax rate in the
jurisdiction in which they have been or will be realized, adjusted
for the estimated recoverability of those benefits.
Management has included these measures because, in the opinion of
management, excluding those foregoing items is useful in comparing
the company's current results with those of prior and future
periods. Management also believes that excluding the impact
of the remeasurement of foreign income tax accounts represents a
meaningful indicator of the company's ongoing effective tax
rate.
CONTACT:
Vic Svec
(314) 342-7768
Condensed
Consolidated Statements of Operations (Unaudited)
|
For the Quarters
and Nine Months Ended Sept. 30, 2015 and 2014
|
|
|
|
|
|
|
|
|
|
|
(In Millions, Except
Per Share Data)
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Nine Months
Ended
|
|
|
|
Sept.
|
|
Sept.
|
|
Sept.
|
|
Sept.
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Tons Sold
|
|
58.4
|
|
|
62.5
|
|
|
170.9
|
|
|
185.5
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
1,418.9
|
|
|
$
|
1,722.9
|
|
|
$
|
4,296.1
|
|
|
$
|
5,107.7
|
|
Operating Costs and
Expenses (1)
|
|
1,254.0
|
|
|
1,453.3
|
|
|
3,774.4
|
|
|
4,315.7
|
|
Depreciation,
Depletion and Amortization
|
|
136.0
|
|
|
163.6
|
|
|
430.6
|
|
|
483.9
|
|
Asset Retirement
Obligation Expenses
|
|
12.3
|
|
|
15.0
|
|
|
40.4
|
|
|
46.5
|
|
Selling and
Administrative Expenses
|
|
37.8
|
|
|
52.9
|
|
|
128.8
|
|
|
171.6
|
|
Restructuring
Charges
|
|
1.8
|
|
|
—
|
|
|
23.0
|
|
|
—
|
|
Other Operating
(Income) Loss:
|
|
|
|
|
|
|
|
|
Net Gain on Disposal
of Assets
|
|
(7.9)
|
|
|
(13.9)
|
|
|
(20.2)
|
|
|
(25.9)
|
|
Asset
Impairment
|
|
—
|
|
|
—
|
|
|
900.8
|
|
|
—
|
|
Loss from Equity
Affiliates:
|
|
|
|
|
|
|
|
|
Results of
Operations
|
|
4.2
|
|
|
14.3
|
|
|
8.5
|
|
|
40.0
|
|
Change in
Deferred Tax Asset Valuation Allowance
|
|
0.4
|
|
|
—
|
|
|
(0.4)
|
|
|
—
|
|
Amortization
of Basis Difference
|
|
0.7
|
|
|
1.5
|
|
|
4.2
|
|
|
4.0
|
|
Loss from
Equity Affiliates
|
|
5.3
|
|
|
15.8
|
|
|
12.3
|
|
|
44.0
|
|
Operating (Loss)
Profit
|
|
(20.4)
|
|
|
36.2
|
|
|
(994.0)
|
|
|
71.9
|
|
Interest
Income
|
|
(1.4)
|
|
|
(3.7)
|
|
|
(6.6)
|
|
|
(11.7)
|
|
Interest
Expense:
|
|
|
|
|
|
|
|
|
Interest
Expense
|
|
119.1
|
|
|
103.9
|
|
|
343.6
|
|
|
310.3
|
|
Interest Adjustments
Related to Litigation
|
|
(0.6)
|
|
|
10.6
|
|
|
0.4
|
|
|
11.1
|
|
Loss on Debt
Extinguishment
|
|
—
|
|
|
—
|
|
|
67.8
|
|
|
1.6
|
|
Interest Expense
|
|
118.5
|
|
|
114.5
|
|
|
411.8
|
|
|
323.0
|
|
Loss from Continuing
Operations Before Income Taxes
|
|
(137.5)
|
|
|
(74.6)
|
|
|
(1,399.2)
|
|
|
(239.4)
|
|
Income Tax Provision
(Benefit):
|
|
|
|
|
|
|
|
|
Provision
(Benefit)
|
|
7.7
|
|
|
80.6
|
|
|
(14.8)
|
|
|
34.8
|
|
Tax Benefit Related
to Asset Impairment
|
|
—
|
|
|
—
|
|
|
(67.4)
|
|
|
—
|
|
Remeasurement Benefit
Related to Foreign Income Tax Accounts
|
|
(0.8)
|
|
|
(1.2)
|
|
|
(1.0)
|
|
|
(3.9)
|
|
Income Tax Provision
(Benefit)
|
|
6.9
|
|
|
79.4
|
|
|
(83.2)
|
|
|
30.9
|
|
Loss from Continuing
Operations, Net of Income Taxes
|
|
(144.4)
|
|
|
(154.0)
|
|
|
(1,316.0)
|
|
|
(270.3)
|
|
(Loss) Income from
Discontinued Operations, Net of Income Taxes
|
|
(157.5)
|
|
|
5.0
|
|
|
(202.7)
|
|
|
6.0
|
|
Net Loss
|
|
(301.9)
|
|
|
(149.0)
|
|
|
(1,518.7)
|
|
|
(264.3)
|
|
Less: Net Income
Attributable to Noncontrolling Interests
|
|
2.8
|
|
|
1.6
|
|
|
7.9
|
|
|
8.1
|
|
Net Loss Attributable
to Common Stockholders
|
|
$
|
(304.7)
|
|
|
$
|
(150.6)
|
|
|
$
|
(1,526.6)
|
|
|
$
|
(272.4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
129.0
|
|
|
$
|
216.3
|
|
|
$
|
381.6
|
|
|
$
|
606.3
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS - Loss
from Continuing Operations (2)(3)
|
|
$
|
(8.08)
|
|
|
$
|
(8.72)
|
|
|
$
|
(73.05)
|
|
|
$
|
(15.62)
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS - Net
Loss Attributable to Common Stockholders (2)
|
|
$
|
(16.73)
|
|
|
$
|
(8.44)
|
|
|
$
|
(84.23)
|
|
|
$
|
(15.29)
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Diluted EPS
(2)
|
|
$
|
(8.13)
|
|
|
$
|
(8.78)
|
|
|
$
|
(27.12)
|
|
|
$
|
(15.84)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Excludes items shown
separately.
|
(2)
|
Weighted average
diluted shares outstanding were 18.2 million and 17.9 million for
the quarters ended September 30, 2015 and 2014, respectively, and
18.1 million and 17.9 million for the nine months ended September
30, 2015 and 2014, respectively, as retroactively restated to
reflect the company's 1-for-15 reverse stock split that became
effective on Oct. 1, 2015.
|
(3)
|
Reflects loss from
continuing operations, net of income taxes, less net income
attributable to noncontrolling interests.
|
|
|
|
|
|
|
|
|
|
|
This information
is intended to be reviewed in conjunction with the company's
filings with the SEC.
|
Supplemental
Financial Data (Unaudited)
|
For the Quarters
and Nine Months Ended Sept. 30, 2015 and 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Nine Months
Ended
|
|
|
|
Sept.
|
|
Sept.
|
|
Sept.
|
|
Sept.
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Revenue Summary (In
Millions)
|
|
|
|
|
|
|
|
|
|
U.S. Mining
Operations
|
|
$
|
901.7
|
|
|
$
|
1,024.0
|
|
|
$
|
2,689.0
|
|
|
$
|
3,040.2
|
|
|
|
Australian Mining
Operations
|
|
485.7
|
|
|
676.3
|
|
|
1,539.8
|
|
|
1,995.5
|
|
|
|
Trading and Brokerage
Operations
|
|
24.5
|
|
|
15.0
|
|
|
42.7
|
|
|
46.3
|
|
|
|
Other
|
|
7.0
|
|
|
7.6
|
|
|
24.6
|
|
|
25.7
|
|
|
|
Total
|
|
$
|
1,418.9
|
|
|
$
|
1,722.9
|
|
|
$
|
4,296.1
|
|
|
$
|
5,107.7
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons Sold (In
Millions)
|
|
|
|
|
|
|
|
|
|
|
Powder River Basin
Mining Operations
|
|
35.5
|
|
|
35.5
|
|
|
103.1
|
|
|
105.3
|
|
|
|
Midwestern U.S.
Mining Operations
|
|
5.5
|
|
|
6.5
|
|
|
16.6
|
|
|
18.9
|
|
|
|
Western U.S. Mining
Operations
|
|
4.7
|
|
|
6.2
|
|
|
13.7
|
|
|
18.0
|
|
|
|
Australian
Metallurgical Mining Operations
|
|
4.0
|
|
|
4.5
|
|
|
11.7
|
|
|
12.4
|
|
|
|
Australian Thermal
Mining Operations
|
|
5.3
|
|
|
5.5
|
|
|
15.0
|
|
|
15.5
|
|
|
|
Trading and Brokerage
Operations
|
|
3.4
|
|
|
4.3
|
|
|
10.8
|
|
|
15.4
|
|
|
|
Total
|
|
58.4
|
|
|
62.5
|
|
|
170.9
|
|
|
185.5
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues per Ton -
Mining Operations
|
|
|
|
|
|
|
|
|
|
Powder River Basin
(1)
|
|
$
|
13.42
|
|
|
$
|
13.30
|
|
|
$
|
13.53
|
|
|
$
|
13.65
|
|
|
|
Midwestern
U.S.
|
|
45.79
|
|
|
47.88
|
|
|
46.34
|
|
|
48.63
|
|
|
|
Western
U.S.
|
|
37.67
|
|
|
38.55
|
|
|
38.33
|
|
|
37.91
|
|
|
|
Total - U.S.
(1)
|
|
19.79
|
|
|
21.24
|
|
|
20.16
|
|
|
21.37
|
|
|
|
Australian
Metallurgical
|
|
68.53
|
|
|
88.83
|
|
|
78.59
|
|
|
96.09
|
|
|
|
Australian
Thermal
|
|
38.77
|
|
|
50.03
|
|
|
41.10
|
|
|
51.88
|
|
|
|
Total -
Australia
|
|
51.74
|
|
|
67.38
|
|
|
57.60
|
|
|
71.47
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Costs per
Ton - Mining Operations (2)
|
|
|
|
|
|
|
|
|
|
Powder River Basin
(1)
|
|
$
|
10.03
|
|
|
$
|
10.07
|
|
|
$
|
10.09
|
|
|
$
|
10.02
|
|
|
|
Midwestern
U.S.
|
|
32.51
|
|
|
34.56
|
|
|
33.15
|
|
|
36.14
|
|
|
|
Western
U.S.
|
|
27.98
|
|
|
25.53
|
|
|
27.59
|
|
|
26.24
|
|
|
|
Total - U.S.
(1)
|
|
14.57
|
|
|
15.38
|
|
|
14.75
|
|
|
15.54
|
|
|
|
Australian
Metallurgical
|
|
72.25
|
|
|
100.11
|
|
|
78.77
|
|
|
109.73
|
|
|
|
Australian
Thermal
|
|
29.47
|
|
|
39.22
|
|
|
30.82
|
|
|
38.73
|
|
|
|
Total -
Australia
|
|
48.11
|
|
|
66.45
|
|
|
51.92
|
|
|
70.19
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Margin per Ton
- Mining Operations (2)
|
|
|
|
|
|
|
|
|
|
Powder River Basin
(1)
|
|
$
|
3.39
|
|
|
$
|
3.23
|
|
|
$
|
3.44
|
|
|
$
|
3.63
|
|
|
|
Midwestern
U.S.
|
|
13.28
|
|
|
13.32
|
|
|
13.19
|
|
|
12.49
|
|
|
|
Western
U.S.
|
|
9.69
|
|
|
13.02
|
|
|
10.74
|
|
|
11.67
|
|
|
|
Total - U.S.
(1)
|
|
5.22
|
|
|
5.86
|
|
|
5.41
|
|
|
5.83
|
|
|
|
Australian
Metallurgical
|
|
(3.72)
|
|
|
(11.28)
|
|
|
(0.18)
|
|
|
(13.64)
|
|
|
|
Australian
Thermal
|
|
9.30
|
|
|
10.81
|
|
|
10.28
|
|
|
13.15
|
|
|
|
Total -
Australia
|
|
3.63
|
|
|
0.93
|
|
|
5.68
|
|
|
1.28
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Supplemental
Financial Data (In Millions)
|
|
|
|
|
|
|
|
|
Adjusted EBITDA -
U.S. Mining
|
|
$
|
238.0
|
|
|
$
|
282.3
|
|
|
$
|
721.0
|
|
|
$
|
828.5
|
|
Adjusted EBITDA -
Australian Mining
|
|
34.0
|
|
|
9.4
|
|
|
151.7
|
|
|
35.7
|
|
Adjusted EBITDA -
Trading and Brokerage
|
|
29.4
|
|
|
3.3
|
|
|
30.4
|
|
|
7.7
|
|
Adjusted EBITDA -
Resource Management (3)
|
|
6.2
|
|
|
3.5
|
|
|
17.3
|
|
|
14.7
|
|
Corporate Hedging
Results
|
|
(116.9)
|
|
|
6.8
|
|
|
(326.6)
|
|
|
(7.2)
|
|
Selling and
Administrative Expenses
|
|
(37.8)
|
|
|
(52.9)
|
|
|
(128.8)
|
|
|
(171.6)
|
|
Restructuring
Charges
|
|
(1.8)
|
|
|
—
|
|
|
(23.0)
|
|
|
—
|
|
Other Operating
Costs, Net (4)
|
|
(22.1)
|
|
|
(36.1)
|
|
|
(60.4)
|
|
|
(101.5)
|
|
Adjusted
EBITDA
|
|
129.0
|
|
|
216.3
|
|
|
381.6
|
|
|
606.3
|
|
Operating Cash
Flows
|
|
(34.2)
|
|
|
169.8
|
|
|
(90.6)
|
|
|
250.1
|
|
Acquisitions of
Property, Plant and Equipment
|
|
26.0
|
|
|
42.8
|
|
|
76.9
|
|
|
107.5
|
|
Coal Reserve Lease
Expenditures
|
|
89.3
|
|
|
89.4
|
|
|
89.8
|
|
|
89.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The finalization of
pricing under a customer sales agreement resulted in additional
Powder River Basin revenues per ton, operating costs per ton, and
gross margin per ton of $0.32, $0.06, and $0.26, respectively for
the nine months ended Sept. 30, 2014. The impact on Total -
U.S. revenues per ton, operating costs per ton, and gross margin
per ton was $0.24, $0.05, and $0.19, respectively, for the nine
months ended Sept. 30, 2014.
|
(2)
|
Includes
revenue-based production taxes and royalties; excludes
depreciation, depletion and amortization; asset retirement
obligation expenses; selling and administrative expenses;
restructuring charges; asset impairment; and certain other costs
related to post-mining activities.
|
(3)
|
Includes certain
asset sales, property management costs and revenues, and coal
royalty expense.
|
(4)
|
Includes loss from
equity affiliates (before the impact of related changes in deferred
tax asset valuation allowance and amortization of basis
difference), costs associated with post-mining activities, and
minimum charges on certain transportation-related
contracts.
|
|
|
|
|
|
|
|
|
|
|
|
This information
is intended to be reviewed in conjunction with the company's
filings with the SEC.
|
Condensed
Consolidated Balance Sheets
|
As of Sept. 30,
2015 and Dec. 31, 2014
|
|
|
|
|
|
(Dollars In
Millions)
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
Sept. 30,
2015
|
|
Dec. 31,
2014
|
Cash and Cash
Equivalents
|
|
$
|
334.3
|
|
|
$
|
298.0
|
|
Accounts Receivable,
Net
|
|
370.0
|
|
|
563.1
|
|
Inventories
|
|
348.1
|
|
|
406.5
|
|
Deferred Income
Taxes
|
|
76.5
|
|
|
80.0
|
|
Other Current
Assets
|
|
424.7
|
|
|
363.4
|
|
Total Current
Assets
|
|
1,553.6
|
|
|
1,711.0
|
|
Property, Plant,
Equipment and Mine Development, Net
|
|
9,475.4
|
|
|
10,577.3
|
|
Deferred Income
Taxes
|
|
1.0
|
|
|
0.7
|
|
Investments and Other
Assets
|
|
633.4
|
|
|
902.1
|
|
Total Assets
|
|
$
|
11,663.4
|
|
|
$
|
13,191.1
|
|
|
|
|
|
|
Current Portion of
Long-Term Debt
|
|
$
|
19.5
|
|
|
$
|
21.2
|
|
Accounts Payable and
Accrued Expenses
|
|
1,468.6
|
|
|
1,809.2
|
|
Other Current
Liabilities
|
|
28.1
|
|
|
32.7
|
|
Total Current
Liabilities
|
|
1,516.2
|
|
|
1,863.1
|
|
Long-Term Debt, Less
Current Portion
|
|
6,282.4
|
|
|
5,965.6
|
|
Deferred Income
Taxes
|
|
101.1
|
|
|
89.1
|
|
Other Noncurrent
Liabilities
|
|
2,453.3
|
|
|
2,546.8
|
|
Total
Liabilities
|
|
10,353.0
|
|
|
10,464.6
|
|
Stockholders'
Equity
|
|
1,310.4
|
|
|
2,726.5
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
11,663.4
|
|
|
$
|
13,191.1
|
|
|
|
|
|
|
|
|
|
|
|
This information
is intended to be reviewed in conjunction with the company's
filings with the SEC.
|
|
|
|
|
|
Reconciliation of
Non-GAAP Financial Measures (Unaudited)
|
For the Quarters
and Nine Months Ended Sept. 30, 2015 and 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars In Millions,
Except Per Share Data)
|
|
Quarter
Ended
|
|
Nine Months
Ended
|
|
|
|
Sept.
|
|
Sept.
|
|
Sept.
|
|
Sept.
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
129.0
|
|
|
$
|
216.3
|
|
|
$
|
381.6
|
|
|
$
|
606.3
|
|
|
Depreciation,
Depletion and Amortization
|
|
136.0
|
|
|
163.6
|
|
|
430.6
|
|
|
483.9
|
|
|
Asset Retirement
Obligation Expenses
|
|
12.3
|
|
|
15.0
|
|
|
40.4
|
|
|
46.5
|
|
|
Change in Deferred
Tax Asset Valuation Allowance Related to Equity
Affiliates
|
|
0.4
|
|
|
—
|
|
|
(0.4)
|
|
|
—
|
|
|
Amortization of Basis
Difference Related to Equity Affiliates
|
|
0.7
|
|
|
1.5
|
|
|
4.2
|
|
|
4.0
|
|
|
Interest
Income
|
|
(1.4)
|
|
|
(3.7)
|
|
|
(6.6)
|
|
|
(11.7)
|
|
|
Interest
Expense
|
|
118.5
|
|
|
114.5
|
|
|
411.8
|
|
|
323.0
|
|
|
Income Tax Provision
(Benefit), Excluding Tax Items Shown Separately Below
|
|
7.7
|
|
|
80.6
|
|
|
(14.8)
|
|
|
34.8
|
|
Adjusted Loss from
Continuing Operations (1)
|
|
(145.2)
|
|
|
(155.2)
|
|
|
(483.6)
|
|
|
(274.2)
|
|
|
Asset
Impairment
|
|
—
|
|
|
—
|
|
|
900.8
|
|
|
—
|
|
|
Tax Benefit Related
to Asset Impairment
|
|
—
|
|
|
—
|
|
|
(67.4)
|
|
|
—
|
|
|
Remeasurement Benefit
Related to Foreign Income Tax Accounts
|
|
(0.8)
|
|
|
(1.2)
|
|
|
(1.0)
|
|
|
(3.9)
|
|
|
|
|
|
|
|
|
|
|
|
Loss from Continuing
Operations, Net of Income Taxes
|
|
$
|
(144.4)
|
|
|
$
|
(154.0)
|
|
|
$
|
(1,316.0)
|
|
|
$
|
(270.3)
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
Attributable to Noncontrolling Interests
|
|
$
|
2.8
|
|
|
$
|
1.6
|
|
|
$
|
7.9
|
|
|
$
|
8.1
|
|
|
|
|
|
|
|
|
|
|
|
Diluted EPS - Loss
from Continuing Operations (2)
|
|
$
|
(8.08)
|
|
|
$
|
(8.72)
|
|
|
$
|
(73.05)
|
|
|
$
|
(15.62)
|
|
|
Asset Impairment, Net
of Income Taxes
|
|
—
|
|
|
—
|
|
|
45.98
|
|
|
—
|
|
|
Remeasurement Benefit
Related to Foreign Income Tax Accounts
|
|
(0.05)
|
|
|
(0.06)
|
|
|
(0.05)
|
|
|
(0.22)
|
|
Adjusted Diluted
EPS
|
|
$
|
(8.13)
|
|
|
$
|
(8.78)
|
|
|
$
|
(27.12)
|
|
|
$
|
(15.84)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
In order to arrive at
the numerator used to calculate Adjusted Diluted EPS, it is
necessary to deduct net income attributable to noncontrolling
interests from this amount.
|
(2)
|
Reflects loss from
continuing operations, net of income taxes, less net income
attributable to noncontrolling interests.
|
|
|
|
|
|
|
|
|
|
|
This information
is intended to be reviewed in conjunction with the company's
filings with the SEC.
|
Supplemental
Hedging Data
|
As of September
30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
Australian Dollar
Hedging
|
2015
|
|
2016
|
|
2017
|
Percent Hedged - from
9/30/15
|
55%
|
|
46%
|
|
24%
|
Hedge Rate
|
$0.97
|
|
$0.92
|
|
$0.88
|
All-in Rate - Full
Year
|
$0.89
|
|
$0.80
|
|
$0.73
|
|
|
|
|
|
|
Fuel
Hedging
|
2015
|
|
2016
|
|
2017
|
Percent Hedged - from
9/30/15
|
91%
|
|
67%
|
|
47%
|
Hedge Price (per
barrel equivalent)
|
$84
|
|
$88
|
|
$82
|
All-in Price (per
barrel equivalent) - Full Year
|
$81
|
|
$72
|
|
$65
|
|
|
|
|
|
|
Cost
Sensitivity
|
|
|
|
|
|
Unhedged AUD position
sensitivity to $0.05 move
|
$13
|
|
$60
|
|
$84
|
Unhedged Fuel
position sensitivity to $10 bbl move
|
$1
|
|
$14
|
|
$22
|
|
|
|
|
|
|
|
Notes: 2015 hedge
percentages and hedge rate/price are for October through December
2015; 2015 all-in rate/price incorporates the full year for
year-on-year comparisons. Estimated cumulative savings and
cost sensitivities based on 2015 estimated requirements of ~$2.2
billion AUD and ~150 million gallons of diesel fuel
usage.
|
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SOURCE Peabody Energy