Rhino posted an adjusted earnings before interest, tax and depreciation of $22 million and net income of $9 million for the March 2012 quarter.
The buoyed financial figures represent a significant jump from the previous corresponding quarter, in which the company recorded a $16.7 million EBITDA and net income of $6.1 million.
Coal sales for the quarter tipped in at 1.1 million tonnes.
Total coal revenues for the quarter reached $69.6 million, a decrease of about 11% from the previous corresponding period.
Rhino attributed this decline to a weakness in the steam coal market.
Rhino president and chief executive officer Dave Zatezalo said he was pleased with the company’s robust first quarter financial results.
“Our first quarter results were solid despite a weak steam coal market as we focused on fulfilling our customer contracts in a cost efficient manner,” he said.
“We continued our focus on safety and improving operating efficiency, which resulted in the best safety performance in our history in the first quarter of 2012.
“Our diversification efforts into oil and gas properties began to show results in the first quarter as we signed a lease agreement for a portion of our Utica Shale acreage and also began to receive royalty income from our Cana Woodford investment.”
While the market downturn has affected all of Rhino’s operations, the company admitted the downturn had the least impact on its steam coal operations at Hopedale, Sands Hill and Castle Valley.
It wasn’t all good news for the company, with Rhino conceding that it had experienced slowdowns in shipments to certain customers under their contracted sales.
Rhino responded to the reduced demand in Central Appalachia by reducing production.
Rhino also revised its guidance for the remainder of 2012.
It was a busy quarter for the producer, with the highlights of its Central Appalachia-operations including starting up operations at its Tug River preparation plant.
Rhino is hoping the operation will result in significant cost savings and increased production flexibility from this plant's operation.
Post quarter, Rhino’s Remining 3 surface mine at the Tug River complex was developed, with production on April 24.
This mine has an operating capability rate of 375,000 tons per year, which could be potentially doubled within 12 months.
The producer also decided to idle the 3 Mile surface mine due to market conditions for its steam coal product.
During the quarter, Rhino appointed Chris Walton as chief operating officer with the aim of improving the company’s operations in the future.