January 30, 2014
Peabody Energy (NYSE: BTU) reported full-year 2013 revenues of $7.01 billion, leading to Adjusted EBITDA of $1.05 billion. In 2013, the company achieved $340 million of cost savings, reduced capital investments by 67 percent and generated $722 million of operating cash flow.
"Peabody delivered on our 2013 objectives, with notable operating performance, structural cost improvements, disciplined capital spending and solid cash flow," said Peabody Energy Chairman and Chief Executive Officer Gregory H. Boyce. "Our leading presence in the high-growth Pacific Rim region and the lowest-cost U.S. basins uniquely positions the company to manage near-term markets and have significant earnings leverage to volume and price as markets continue to improve."
RESULTS FROM PEABODY CONTINUING OPERATIONS
2013 revenues of $7.01 billion were impacted by lower realized pricing in Australia and the United States. Sales volumes increased 1 percent to 251.7 million tons as higher Australian and Trading and Brokerage shipments offset a reduction in U.S. volumes.
Australian revenues of $2.90 billion were impacted by a 22 percent decline in revenues per ton that was partially offset by a 6 percent rise in shipments. Australia sales totaled 34.9 million tons, including 15.9 million tons of metallurgical coal and 11.4 million tons of seaborne thermal coal. U.S. Mining revenues of $4.01 billion were impacted by a 4 percent decline in both volumes and realized pricing.
2013 Adjusted EBITDA totaled $1.05 billion compared with $1.84 billion in 2012, primarily due to the impact of nearly $800 million from lower pricing that was partly offset by $340 million in cost improvements. Australian Mining Adjusted EBITDA of $316.6 million was affected by nearly $700 million related to lower pricing that was partly mitigated by a 4 percent reduction in unit costs. Fourth quarter Australian Adjusted EBITDA was also impacted by $100 million related to the delayed longwall commissioning at the North Goonyella Mine and industrial action at the Metropolitan Mine. Absent the impact from these events, Australian costs per ton would have been approximately $5.00 lower for the quarter. In 2013, the company made structural cost improvements in Australia by completing several owner-operator conversions and improving productivity at the PCI mines, resulting in a 25 percent and 20 percent cost improvement at the respective operations. 2013 U.S. Mining Adjusted EBITDA declined 11 percent to $1.12 billion, driven by a decline in volumes and revenues per ton that was partly offset by a 3 percent improvement in operating costs per ton.
Trading and Brokerage Adjusted EBITDA totaled $0.7 million compared with $119.7 million in the prior year. Results were impacted by sustained levels of low volatility and pricing in the seaborne markets that led to a decline in mark-to-market earnings; lower U.S. brokerage volumes and margins primarily related to Patriot Coal; increased third-party supply issues; and compressed margins on U.S. and Asian exports.
Loss from Continuing Operations totaled $(286.0) million in 2013 compared with $(470.9) million in the prior year. 2013 results were impacted by pre-tax asset impairment charges of $528.3 million related to several operating and non-operating properties in the U.S. and Australia as well as a $30.6 million charge related to the company's settlement with Patriot Coal and the United Mine Workers of America. Results also reflect lower gross margins and higher depreciation, depletion and amortization expense that were partly offset by lower income tax expenses.
Diluted Loss from Continuing Operations totaled $(1.12) per share with Adjusted Diluted Earnings of $0.34 per share.
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