Foresight reports record longwall production

FORESIGHT Energy has set a record for quarterly coal production of 6.6 million tons in the three months to March 2015 with solid performances from its four leading US longwall coal mines in the Illinois Basin.
Foresight reports record longwall production Foresight reports record longwall production Foresight reports record longwall production Foresight reports record longwall production Foresight reports record longwall production

Image courtesy of Foresight Energy.

Lou Caruana

The company also reported an 8.4% increase in sales volumes to 5.1Mt compared to the quarter ended March 31, 2014.

First quarter adjusted earnings before interest, tax, depreciation and amortisation increased 19.5% to $US101.5 million compared to the first quarter in 2014 while net income attributable to limited partner units increased 34.2% to $42.3 million.

Foresight’s first quarter results were positively impacted by $15.8 million in unrealised gains on commodity derivative contracts and a legal settlement of $13.5 million, which helped offset the negative impact of scheduled coal shipments that shifted out of the quarter, its CEO Michael Beyer said.

“Foresight’s highly productive, low cost operations continue to drive strong financial performance as evidenced by our first quarter results,” he said.

“Once again our Hillsboro, Williamson and Sugar Camp longwall complexes were the three most productive underground coal mines in the United States during the first quarter based on clean tons produced per man hour worked as reported by MSHA.

“Foresight’s industry leading productivity and low cost structure continues to drive its growth despite weak domestic and international coal markets.”

Coal sales revenue totalled $238.9 million for the three months ended March 31 2015, compared to $242.7 million in the prior year period.

The increase in sales volumes during the quarter were supported by additional production from the start-up of the second longwall at Foresight’s Sugar Camp complex in June 2014.

However, sales volumes during the quarter were negatively impacted by transportation disruptions, including the high water on the Ohio River that temporarily halted throughput at its Sitran terminal and resulted in sales volumes being pushed into future quarters.

Cost of coal produced increased $17.6 million to $110.6 million, due to higher sales volumes and a $1.93 increase in cash cost per ton sold to $21.68 per ton.

The increase in cash cost per ton was principally driven by the Williamson mine, which experienced higher labour-related, supply, and repair costs compared to the first quarter of 2014.

Additionally, production costs at the Williamson mine were negatively impacted during the quarter by decreased production primarily as a result of a longwall move.

Transportation expense of $47.4 million declined 19.1% during the quarter. This decrease was principally driven by lower international sales as well as lower expenses for shortfalls on minimum contractual throughput volume requirements.

loader