TORONTO (miningweekly.com) – US coal producer Alpha Natural Resources has narrowed its net loss for the third-quarter to $185-million, or $0.84 a share, compared with a net loss of $458-million, or $2.07 a share, in the comparable quarter of 2013, when it booked a $253-million goodwill impairment charge.
Excluding special items, the Bristol, Virginia-based company reported an adjusted net loss of $118-million, or $0.53 a share, compared with its adjusted net loss of $134-million, or $0.61 a share, in the third quarter of 2013.
The improved performance for the quarter ended September 30 was boosted by the company’s ongoing cost-cutting initiatives that helped it side-step lower prices and shipments.
Consolidated revenues in the third quarter fell 8% to $1.1-billion compared with $1.2-billion in the third quarter of 2013, while coal revenues were $900-million, down from $1-billion in the year-ago period. The decreases in total revenues and coal revenues were mainly attributable to lower average realisations and lower shipments of metallurgical and Powder River basin (PRB) steam coal.
During the period, metallurgical coal shipments were 4.8-million tons compared with five-million tons a year earlier.
Alpha shipped 9.3-million tons of PRB coal during the quarter, compared with 10.1-million tons in the year-ago period. Eastern steam coal shipments were 7.2-million tons compared with 6.7-million tons.
The average realised price of metallurgical coal was $82.45/t, down 13% from $94.73/t in the third quarter last year. The average realised price for PRB shipments was $11.81/t compared with $12.58/t a year earlier. Eastern steam coal shipments on average fetched $58.16/t, down from $63.21/t a year earlier.
Meanwhile, Alpha’s Marcellus gas 50:50 joint venture (JV) with EDF Trading Resources was reported as progressing well with a net acreage position to the JV of more than 20 000 acres. During the quarter, the Pennsylvania Department of Environmental Protection issued two drilling permits to the JV and construction had started on an initial pad location.
Output from initial wells was expected in early next year, with at least four additional wells expected during the year. The JV was currently evaluating additional pad sites.
Alpha increased its 2014 shipment guidance for Eastern metallurgical and Eastern steam coals, while maintaining its PRB guidance. It now expected to ship between 79-million and 86-million tons, including 17-million to 19-million tons of Eastern metallurgical coal, 28-million to 30-million tons of Eastern steam coal and 34-million to 37-million tons of Western steam coal.
Alpha’s NYSE-listed stock took a knock on Thursday, losing 6.60% to change hands at $2 apiece. The company's stock had lost more than 70% of its value so far this year.