"Supply challenges around the world and lack of capital to respond to market shortages will continue to drive a tight global supply-demand balance for coal,” Peabody chief commercial officer Richard Navarre said.

“In addition, we believe that the long-term coal demand profile is very strong and will continue to be led by emerging economies."

That confidence though has not been enough to buffer one of the world’s biggest coal miners from the stock market crash, despite rallying up 18.3% on Thursday to $US26.68. On June 30 the miner was trading at a 52-week high of $88.69.

During the September quarter Peabody posted record revenues of $1.91 billion, a 59% jump period-on-period. Tons sold were 6% above year-ago levels at 66 million tons.

The company’s net income was $369.6 million, up from the third quarter of 2007 when it totalled $32.3 million.

Peabody said both the US and Australian business sectors realised impressive bottom-line results over the quarter.

Australian coal shipments grew 21% versus last year’s third quarter as well as 15% year-to-date.

Higher prices were reflected in improved revenues per ton of 114% over the year-ago quarter and 66% year-to-date.

US operations were also up over last year, with a 15% increase in realised prices due in part to Peabody’s new southwest operation El Segundo.

Peabody chief financial officer Michael Crews said benefits from the company’s multi-year capital investment initiative had become visible in the September quarter.

“We have improved volumes, stabilised costs, expanded margins and generated strong cash flows that enabled us to repay debt and repurchase shares during the quarter," he said.

During the quarter Peabody continued its good safety record, with a 27% improvement year-to-date with the producer on its way to marking the safest year in its history.

Looking ahead, Peabody has contracted much of its output for 2009.

Peabody expects EBITDA of $1.75-1.85 billion for 2008, up 92% from 2007.