Arch Coal Inc. ACI reported first-quarter 2015 adjusted loss of 54 cents per share, wider than the Zacks Consensus Estimate of a loss of 48 cents. The company’s loss in the prior-year quarter was 60 cents per share.
Total Revenue
In the first quarter, Arch Coal’s total revenue of $677 million missed the Zacks Consensus Estimate of $728 million by 7%. A decline in average sales price per ton primarily led to an 8% year-over-year decrease in revenues.
Operational Update
In the quarter under review, Arch Coal’s sales volume increased 5.4% year over year to 33.1 million tons primarily on the back of higher contribution from the Powder River Basin. This was partially offset by lower sales volumes at the Appalachia and Bituminous Thermal operations.
Average sales price per ton decreased 4.5% to $19.18 from $20.09 a year ago.
In the first quarter, total operating expenses were at $696.7 million, down 13.9% year over year primarily due to lower cost of sales, and selling, general and administrative expenses.
Net interest expenses were $96.9 million, 2.4% higher than the prior-year period.
Arch Coal reported earnings before interest, taxes, depreciation and amortization of $81.8 million, significantly higher than $27.6 million a year ago.
Financial Update
Cash and cash equivalents as of Mar 31, 2015 were $690 million compared with $734.2 million as of Dec 31, 2014.
Long-term debt as of Mar 31, 2015 was $5,118 million compared with $5,123.5 million as of Dec 31, 2014.
Capital expenditure in the first quarter of 2015 was $22.9 million, significantly higher than $14.5 million incurred a year-ago.
Guidance
Arch Coal reduced its thermal and metallurgical coal sales guidance for 2015 to 120–130 million tons from 124–136 million tons, and 6.0–6.8 million tons from 6.3–7.0 million tons projected earlier, respectively.
Arch Coal updated its capital expenditure guidance for 2015 to the range of $140–$155 million from previous estimate of $145–$160 million.
Upcoming Release
CONSOL Energy Inc. CNX is slated to release its first-quarter 2015 earnings on Apr 28. The Zacks Consensus Estimate is pegged at 11 cents.
Peabody Energy Corp. BTU is slated to release its first-quarter 2015 earnings on Apr 23. The Zacks Consensus Estimate is pegged at a loss of 33 cents.
Zacks Rank
Arch Coal currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the same sector is Rhino Resource Partners LP RNO, carrying a Zacks Rank #1 (Strong Buy).
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