Net income from continuing operations was also down at $41.2 million compared with $44.6 million for the previous corresponding period.
"We are off to a good start for 2013 and our results this quarter position us well for the remainder of the year despite another mild winter in Florida,” TECO Energy president and chief executive officer John Ramil said.
“The utilities are benefiting from continued improvements in the state and local economies, and TECO Coal is operating profitably even in a weak market, with a strong focus on margins and cost control."
TECO Coal reported Q1 net income of $3 million on sales of 1.3 million tons, compared with $9.8 million on sales of 1.4Mt in the same period in 2012.
In 2013, Q1 results reflect an average net per-ton selling price, excluding transportation allowances, of almost $90 per ton, which included higher priced carry-over tons from 2012, compared to an average selling price of almost $96/t in 2012.
In Q1 2013, the all-in total per-ton cost of sales was almost $88, which is higher than full-year guidance.
The cost of sales in January and February included some higher-cost tons from December’s inventory that included costs associated with personnel reductions and with idling certain mining operations.
The cost of sales in March was in line with full-year 2013 cost guidance.
The all-in total cost of production is still expected to be in a range between $81/t and $85/t, due to actions taken in 2012 to reduce mining costs and lower royalty payments and severance taxes, which are a function of selling price.
Due to the effects of tax percentage depletion, TECO Coal's effective income tax rate in Q1 2013 was essentially zero, compared with 24% in the 2012 period.
TECO’s coal subsidiary now has almost 95% of its expected sales of between 5.2Mt and 5.7Mt contracted for 2013.
The product mix is expected to be about 50% specialty coals, which include stoker, metallurgical and pulverized coal injection coals and the remainder utility steam coal.
The average selling price across all products is expected to be more than $86/t.
All of the 2.7Mt of steam coal sales planned for 2013 are committed and priced.
Because of the zero effective tax rate in the first quarter, TECO Coal's full-year 2013 effective income tax rate is expected to be less than the previously forecast 25%.
