TORONTO (miningweekly.com) – NYSE-listed Arch Coal has reported a third-quarter loss of $128.4-million, or $0.61 a share, compared with a profit of $45.8-million, or $0.22 a share, a year earlier.
The US’s second-largest coal producer said that for the three months ended September 30, its adjusted net loss, excluding one-off items, was $0.01 a share, beating the average analyst estimate of a loss of $0.31 a share on revenues of $888.79-million.
Arch recorded asset impairment charges of $200.4-million in the third quarter. The charges were mainly related to reducing the carrying value of the Hazard thermal mining complex in eastern Kentucky, owing to ongoing weak thermal market conditions in Appalachia, as well as writing down an equity investment in a coal conversion project.
Arch’s revenues declined 19% to $791.3-million, down from $975.2-million a year earlier, as weak coal prices persisted.
The miner sold 2% more coal at 38.3-million tons, cash operating costs per ton fell 18.5% in the period to $19.37, and the average sales price fell 23.5% to $19.54/t.
“Higher shipment levels and strong cost control in the third quarter led to the best cost-per-ton performance in ten consecutive quarters in the Powder River basin; and our ongoing success in that area has allowed us to lower our full-year 2013 cost guidance again in key operating regions,” executive president and COO Paul Lang said.
The company trimmed its full-year average cash costs for its Powder River basin operations to between $10.40/t and $10.60/t, down from the $10.45/t to $10.85/t it had previously forecast. The average cash cost forecast for the Appalachian operations was cut to between $65/t and $69/t, down from between $65.50/t and $69.50/t.
For 2013, Arch now expected thermal sales volumes to be in the range of 134-million to 137-million tons. The company had also lowered its metallurgical sales expectations, and now expects to ship between 6.9-million and 7.3-million tons into coking coal and pulverised coal injection markets during 2013.
“We are realigning our portfolio to focus on those core assets with the best long-term value and growth potential, particularly the Powder River basin thermal franchise and the Appalachian metallurgical coal platform,” president and CEO John Eaves said.
Arch’s NYSE-listed stock lost 3.68% of its value by noon on Tuesday, changing hands at $4.01 apiece.