James River Coal Company Reports Fourth Quarter and Full Year 2012 Operating Results
RICHMOND, Va., March 7, 2013 /PRNewswire/ --
- Major Restructuring of Mine Operations in Q-4 2012 and Early Q-1 2013
- Closed or Idled Production Capacity of 3 Million Tons in Central Appalachia (CAPP)
- Reduced Workforce by Approximately 400 Employees and Contractors
- Significant Impact on Productivity and Costs in Q-4 2012
- Thermal Coal Markets Continue to Be Weak; Met Coal Markets are Slowly Improving
- Continuing to Evaluate Options to Strengthen the Balance Sheet and Improve Liquidity
- Conference Call Slides Posted to the Company Website
James River Coal Company (NASDAQ: JRCC), today announced that it had a net loss of $138.9 million or $3.99 per fully diluted share for the year ended December 31, 2012 and a net loss of $76.9 million or $2.21 per fully diluted share for the fourth quarter of 2012. This is compared to a net loss of $39.1 million or $1.19 per fully diluted share for the year ended December 31, 2011 and a net loss of $28.5 million or $0.82 per fully diluted share for the fourth quarter of 2011. Our results were impacted by the items in "Reconciliation of Adjusted Net Income (Loss) to Net Income (Loss)" in this release below which include a goodwill impairment charge and a gain from the repurchase of outstanding debt. These adjustments had a negative per share impact on our results of $0.03 and $0.62 in the full year and fourth quarter ended December 31, 2012, respectively, and $0.98 and $0.76 in the full year and fourth quarter ended December 31, 2011, respectively.
Peter T. Socha, Chairman and Chief Executive Officer, commented: "The year 2012 will be remembered as one of the most difficult years in the history of the U.S. coal industry. The domestic thermal coal market went through a third consecutive year of soft market conditions due to weak economic conditions and competitive pressures from natural gas production. The met coal market collapsed during the middle of the year due to weak international markets in both Asia and Europe. As we look ahead to 2013, both of these markets are showing some marginal improvement. The thermal market, although still weak, is starting to improve due primarily to reduced production by the coal industry and slightly better weather conditions. The met market is seeing clear signs of increased demand from Asia.
"At James River Coal Company, we are adjusting to the changing market conditions throughout our organization. We have closed and idled mines, reduced working hours at the remaining mines, reviewed and changed the purchasing process for nearly every item that we buy, and lowered our SG&A headcount and expenses. Many of these decisions have been difficult but necessary. Our mine operations are in better shape today than at any time in the past 10 years. We are beginning to see the positive results from the changes, and we are cautiously optimistic that our changed operating model and improving markets for several of our products will lead to a brighter future in 2013."
ANNUAL RESULTS
The following tables show selected operating results for the year ended December 31, 2012 compared to the year ended December 31, 2011 (in 000's except per ton amounts).
Total Results |
Year Ended December 31, |
|||||||||
2012 |
2011 |
|||||||||
Total |
Per Ton |
Total |
Per Ton |
|||||||
Company and contractor production (tons) |
9,499 |
10,254 |
||||||||
Coal purchased from other sources (tons) |
1,995 |
1,605 |
||||||||
Total coal available to ship (tons) |
11,494 |
11,859 |
||||||||
Coal shipments (tons) |
11,728 |
11,801 |
||||||||
Coal sales revenue |
$ 1,018,433 |
$ 86.84 |
$ 1,105,370 |
$ 93.67 |
||||||
Freight and handling revenue |
81,176 |
6.92 |
72,285 |
6.13 |
||||||
Cost of coal sold |
911,681 |
77.74 |
905,482 |
76.73 |
||||||
Freight and handling costs |
81,176 |
6.92 |
72,285 |
6.13 |
||||||
Depreciation, depletion, & amortization |
131,779 |
11.24 |
108,914 |
9.23 |
||||||
Gross profit (loss) |
(25,027) |
(2.13) |
90,974 |
7.71 |
||||||
Selling, general & administrative |
59,922 |
5.11 |
57,078 |
4.84 |
||||||
Goodwill impairment |
26,492 |
2.26 |
- |
- |
||||||
Acquisition costs |
- |
- |
8,504 |
0.72 |
||||||
Adjusted EBITDA plus acquisition costs (1) |
$ 54,668 |
4.66 |
$ 154,571 |
13.10 |
||||||
(1) Adjusted EBITDA plus acquisition costs is defined under "Reconciliation of Non-GAAP Measures" in this release. |
||||||||||
Adjusted EBITDA is used to determine compliance with financial covenants in our revolving credit facility. |
Segment Results |
Year Ended December 31, |
||||||||||||
2012 |
2011 |
||||||||||||
CAPP |
Midwest |
CAPP |
Midwest |
||||||||||
Total |
Per Ton |
Total |
Per Ton |
Total |
Per Ton |
Total |
Per Ton |
||||||
Company and contractor production (tons) |
7,183 |
2,316 |
7,823 |
2,431 |
|||||||||
Coal purchased from other sources (tons) |
1,995 |
- |
1,605 |
- |
|||||||||
Total coal available to ship (tons) |
9,178 |
2,316 |
9,428 |
2,431 |
|||||||||
Coal shipments (tons) |
|||||||||||||
Steam (tons) |
5,787 |
2,327 |
7,166 |
2,480 |
|||||||||
Metallurgical (tons) |
3,614 |
- |
2,155 |
- |
|||||||||
Total Shipments (tons) |
9,401 |
2,327 |
9,321 |
2,480 |
|||||||||
Coal sales revenue |
|||||||||||||
Steam |
$ |
476,101 |
82.27 |
103,078 |
44.30 |
651,016 |
90.85 |
105,382 |
42.49 |
||||
Metallurgical |
439,254 |
121.54 |
- |
- |
348,972 |
161.94 |
- |
- |
|||||
Total coal sales revenue |
915,355 |
97.37 |
103,078 |
44.30 |
999,988 |
107.28 |
105,382 |
42.49 |
|||||
Freight and handling revenue |
78,983 |
8.40 |
2,193 |
0.94 |
69,778 |
7.49 |
2,507 |
1.01 |
|||||
Cost of coal sold |
821,278 |
87.36 |
90,403 |
38.85 |
811,573 |
87.07 |
93,909 |
37.87 |
|||||
Freight and handling costs |
78,983 |
8.40 |
2,193 |
0.94 |
69,778 |
7.49 |
2,507 |
1.01 |
QUARTERLY RESULTS
The following tables show selected operating results for the quarter ended December 31, 2012 compared to the quarter ended December 31, 2011 (in 000's except per ton amounts).
Total Results |
Three Months Ended December 31, |
|||||||||
2012 |
2011 |
|||||||||
Total |
Per Ton |
Total |
Per Ton |
|||||||
Company and contractor production (tons) |
1,928 |
2,675 |
||||||||
Coal purchased from other sources (tons) |
567 |
709 |
||||||||
Total coal available to ship (tons) |
2,495 |
3,384 |
||||||||
Coal shipments (tons) |
2,603 |
3,304 |
||||||||
Coal sales revenue |
$ 214,409 |
82.37 |
$ 321,758 |
97.38 |
||||||
Freight and handling revenue |
17,755 |
6.82 |
35,420 |
10.72 |
||||||
Cost of coal sold |
206,113 |
79.18 |
263,315 |
79.70 |
||||||
Freight and handling costs |
17,755 |
6.82 |
35,420 |
10.72 |
||||||
Depreciation, depletion, & amortization |
33,627 |
12.92 |
33,435 |
10.12 |
||||||
Gross profit (loss) |
(25,331) |
(9.73) |
25,008 |
7.57 |
||||||
Selling, general & administrative |
14,418 |
5.54 |
16,553 |
5.01 |
||||||
Adjusted EBITDA plus acquisition costs (1) |
$ (4,970) |
(1.91) |
$ 44,155 |
13.36 |
||||||
(1) Adjusted EBITDA plus acquisition costs is defined under "Reconciliation of Non-GAAP Measures" in this release. |
||||||||||
Adjusted EBITDA is used to determine compliance with financial covenants in our senior secured credit facilities. |
Segment Results |
Three Months Ended December 31, |
||||||||||||
2012 |
2011 |
||||||||||||
CAPP |
Midwest |
CAPP |
Midwest |
||||||||||
Total |
Per Ton |
Total |
Per Ton |
Total |
Per Ton |
Total |
Per Ton |
||||||
Company and contractor production (tons) |
1,399 |
529 |
2,120 |
555 |
|||||||||
Coal purchased from other sources (tons) |
567 |
- |
709 |
- |
|||||||||
Total coal available to ship (tons) |
1,966 |
529 |
2,829 |
555 |
|||||||||
Coal shipments (tons) |
|||||||||||||
Steam (tons) |
1,071 |
550 |
1,909 |
583 |
|||||||||
Metallurgical (tons) |
982 |
- |
812 |
- |
|||||||||
Total Shipments (tons) |
2,053 |
550 |
2,721 |
583 |
|||||||||
Coal sales revenue |
|||||||||||||
Steam |
$ |
84,890 |
79.26 |
24,124 |
43.86 |
173,274 |
90.77 |
24,590 |
42.18 |
||||
Metallurgical |
105,395 |
107.33 |
- |
- |
123,894 |
152.58 |
- |
- |
|||||
Total coal sales revenue |
190,285 |
92.69 |
24,124 |
43.86 |
297,168 |
109.21 |
24,590 |
42.18 |
|||||
Freight and handling revenue |
17,408 |
8.48 |
347 |
0.63 |
34,705 |
12.75 |
715 |
1.23 |
|||||
Cost of coal sold |
183,012 |
89.14 |
23,101 |
42.00 |
240,598 |
88.42 |
22,717 |
38.97 |
|||||
Freight and handling costs |
17,408 |
8.48 |
347 |
0.63 |
34,705 |
12.75 |
715 |
1.23 |
MARKET ADJUSTMENTS
Due to the continuing downturn in the coal market, the Company has idled five underground mines (Abner Branch, Mine 16, Mine 6A, Mine 31, Jellico), two preparation plants (BL1 Plant and Burke), one load out (Sunny Knot) and reduced production at three surface mines (Frasure, Buckeye, Montgomery Creek). These and previous changes reduce our production capacity by 3 million tons and impact approximately 400 employees and contractors. We project that these changes will lower our operating costs and better match our production to our current market view.
LIQUIDITY AND CASH FLOW
As of December 31, 2012, the Company had available liquidity of $135.9 million calculated as follows (in millions):
Unrestricted Cash |
$ 127.4 |
Availability under the revolver |
69.3 |
Letters of Credit Issued under the Revolver |
(60.8) |
Available Liquidity |
$ 135.9 |
Restricted Cash |
$ 36.6 |
Capital Expenditures for the fourth quarter were $15.1 million and were $81.6 million for twelve months ended December 31, 2012.
During the fourth quarter of 2012, the Company completed its previously announced repurchase of $7.7 million of its outstanding debt consisting of $2.5 million principal amount of the 2015 Convertible Senior Notes and $5.2 million principal amount of the 2018 Convertible Senior Notes. The debt repurchases were made at a cost of $2.9 million, in open market purchases. The repurchases resulted in a gain of $3.0 which includes the write-off of $ 0.1 million of financing costs.
Mr. Socha commented: "As discussed during our most recent conference call in November, we are looking at options to strengthen our balance sheet and improve our liquidity during the prolonged soft market conditions. Since November, we have looked at a wide variety of potential options. This process is continuing and we expect to complete our review in a timely manner."
SALES POSITION
As of March 6, 2013, we had the following priced sales position (in 000's except per ton amounts):
2013 Priced |
||||||||
As of November 6, 2012 |
As of March 6, 2013 |
Change |
||||||
Tons |
Avg Price Per Ton |
Tons |
Avg Price Per Ton |
Tons |
Avg Price Per Ton |
|||
CAPP (1) |
3,405 |
$ 74.04 |
5,012 |
$ 81.39 |
1,607 |
$ 96.97 |
||
Midwest (2) |
2,342 |
$ 45.25 |
2,544 |
$ 45.04 |
202 |
$ 42.61 |
||
2014 Priced |
||||||||
As of November 6, 2012 |
As of March 6, 2013 |
Change |
||||||
Tons |
Avg Price Per Ton |
Tons |
Avg Price Per Ton |
Tons |
Avg Price Per Ton |
|||
CAPP (1) |
300 |
$ 75.75 |
300 |
$ 75.75 |
- |
$ - |
||
Midwest (2) |
900 |
$ 47.64 |
900 |
$ 47.64 |
- |
$ - |
||
(1) Priced Tons in CAPP do not include approximately 264,000 tons of met coal that has been sold but not yet priced |
||||||||
(2) The prices for the Midwest are minimum base price amounts adjusted for projected fuel escalators. |
2013 GUIDANCE
Mr. Socha continued: "We will not be issuing production or cost guidance at this time. There are just too many moving pieces. The changes to the mine operations were sweeping and all encompassing. While we are pleased with the results thus far, it is still early.
"In addition, the thermal and met coal markets continue to evolve. These changes will have an impact on our production plans for 2013.
"Based on these two factors, we believe that it is prudent to defer production and cost guidance at this time, but we are providing the following projections:"
Total JRCC Operations |
|||
(In 000's except tax rate) |
|||
Depreciation, Depletion and Amortization |
$ |
130,000 |
|
Tax Rate |
0% |
||
Capital Expenditures |
|||
Maintenance and Safety Capital |
$ |
65,000 |
|
Completion of Ongoing Projects |
5,000 |
||
$ |
70,000 |
MISCELLANEOUS
The following additional items had an impact on our results of operations and balance sheet during the fourth quarter of 2012:
- We recorded an additional net expense of $2.3 million during the quarter related to workers' compensation. This amount resulted from $4.5 million of increased expense due to a reduction in the discount rate, due to lower market interest rates, which was offset by a $2.2 million positive impact due to improved safety performance at the mines and the management of the workers' compensation claim process.
- The Company wrote off $26.5 million of goodwill in the Midwest segment. Subsequent to this write-off the Company has no remaining goodwill.
CONFERENCE CALL AND WEBCAST: The Company will hold a conference call with management to discuss the fourth quarter earnings on March 7, 2013 at 10:00 a.m. Eastern Time. The conference call can be accessed by dialing 877-340-2553, or through the James River Coal Company website at http://www.jamesrivercoal.com. International callers, please dial 678-224-7860.
James River Coal Company is one of the leading coal producers in Central Appalachia and the Illinois Basin. The company sells metallurgical, bituminous steam and industrial-grade coal to electric utility companies and industrial customers both domestically and internationally. The Company's operations are managed through eight operating subsidiaries located throughout eastern Kentucky, southern West Virginia and southern Indiana. Additional information about James River Coal can be found at its web site www.jamesrivercoal.com.
FORWARD-LOOKING STATEMENTS: Certain statements in this press release and other written or oral statements made by or on behalf of us are "forward-looking statements" within the meaning of the federal securities laws. Statements regarding future events and developments and our future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. Forward looking statements include, without limitation, statements regarding future sales and contracting activity, projected fuel escalators, and all guidance figures. These forward-looking statements are subject to a number of risks and uncertainties. These risks and uncertainties include, but are not limited to, the following: our cash flows, results of operation or financial condition; the consummation of acquisition, disposition or financing transactions and the effect thereof on our business; governmental policies, regulatory actions and court decisions affecting the coal industry or our customers' coal usage; legal and administrative proceedings, settlements, investigations and claims; our ability to obtain and renew permits necessary for our existing and planned operation in a timely manner; environmental concerns related to coal mining and combustion and the cost and perceived benefits of alternative sources of energy; inherent risks of coal mining beyond our control, including weather and geologic conditions or catastrophic weather-related damage; our production capabilities; availability of transportation; our ability to timely obtain necessary supplies and equipment; market demand for coal, electricity and steel; competition, including competition from alternative sources such as natural gas; our relationships with, and other conditions affecting, our customers; employee workforce factors; our assumptions concerning economically recoverable coal reserve estimates; future economic or capital market conditions; our plans and objectives for future operations and expansion or consolidation; and the other risks detailed in our reports filed with the Securities and Exchange Commission (SEC). Management believes that these forward-looking statements are reasonable; however, you should not place undue reliance on such statements. These statements are based on current expectations and speak only as of the date of such statements. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information or otherwise.
JAMES RIVER COAL COMPANY |
||||||||||
AND SUBSIDIARIES |
||||||||||
Consolidated Balance Sheets |
||||||||||
(in thousands, except share data) |
||||||||||
December 31, 2012 |
December 31, 2011 |
|||||||||
Assets |
||||||||||
Current assets: |
||||||||||
Cash and cash equivalents |
$ |
127,386 |
199,711 |
|||||||
Trade receivables |
89,816 |
107,557 |
||||||||
Inventories: |
||||||||||
Coal |
26,598 |
52,717 |
||||||||
Materials and supplies |
16,699 |
17,800 |
||||||||
Total inventories |
43,297 |
70,517 |
||||||||
Prepaid royalties |
8,623 |
8,465 |
||||||||
Other current assets |
9,127 |
11,461 |
||||||||
Total current assets |
278,249 |
397,711 |
||||||||
Property, plant, and equipment, net |
855,217 |
909,294 |
||||||||
Goodwill |
- |
26,492 |
||||||||
Restricted cash and short term investments |
36,558 |
29,510 |
||||||||
Other assets |
34,097 |
41,575 |
||||||||
Total assets |
$ |
1,204,121 |
1,404,582 |
|||||||
Liabilities and Shareholders' Equity |
||||||||||
Current liabilities: |
||||||||||
Accounts payable |
$ |
72,861 |
110,557 |
|||||||
Accrued salaries, wages, and employee benefits |
10,996 |
12,996 |
||||||||
Workers' compensation benefits |
9,900 |
9,200 |
||||||||
Black lung benefits |
2,508 |
2,512 |
||||||||
Accrued taxes |
8,382 |
7,563 |
||||||||
Other current liabilities |
22,124 |
27,861 |
||||||||
Total current liabilities |
126,771 |
170,689 |
||||||||
Long-term debt, less current maturities |
546,407 |
582,193 |
||||||||
Other liabilities: |
||||||||||
Noncurrent portion of workers' compensation benefits |
66,953 |
60,721 |
||||||||
Noncurrent portion of black lung benefits |
62,834 |
56,152 |
||||||||
Pension obligations |
35,325 |
29,121 |
||||||||
Asset retirement obligations |
99,177 |
94,654 |
||||||||
Other |
12,027 |
14,390 |
||||||||
Total other liabilities |
276,316 |
255,038 |
||||||||
Total liabilities |
949,494 |
1,007,920 |
||||||||
Commitments and contingencies |
||||||||||
Shareholders' equity: |
||||||||||
Preferred stock, $1.00 par value. Authorized 10,000,000 shares |
- |
- |
||||||||
Common stock, $.01 par value. Authorized 100,000,000 shares; issued and outstanding |
||||||||||
35,866,549 and 35,671,953 shares as of December 31, 2012 and December 31, 2011 |
359 |
357 |
||||||||
Paid-in-capital |
546,289 |
541,362 |
||||||||
Accumulated deficit |
(236,588) |
(97,682) |
||||||||
Accumulated other comprehensive loss |
(55,433) |
(47,375) |
||||||||
Total shareholders' equity |
254,627 |
396,662 |
||||||||
Total liabilities and shareholders' equity |
$ |
1,204,121 |
1,404,582 |
JAMES RIVER COAL COMPANY |
||||||||||||
AND SUBSIDIARIES |
||||||||||||
Consolidated Statements of Operations |
||||||||||||
(in thousands, except share data) |
||||||||||||
Year Ended December 31, |
||||||||||||
2012 |
2011 |
2010 |
||||||||||
Revenues |
||||||||||||
Coal sales revenue |
$ |
1,018,433 |
1,105,370 |
698,949 |
||||||||
Freight and handling revenue |
81,176 |
72,285 |
2,167 |
|||||||||
Total revenue |
1,099,609 |
1,177,655 |
701,116 |
|||||||||
Cost of sales: |
||||||||||||
Cost of coal sold |
911,681 |
905,482 |
512,348 |
|||||||||
Freight and handling costs |
81,176 |
72,285 |
2,167 |
|||||||||
Depreciation, depletion and amortization |
131,779 |
108,914 |
64,368 |
|||||||||
Total cost of sales |
1,124,636 |
1,086,681 |
578,883 |
|||||||||
Gross profit (loss) |
(25,027) |
90,974 |
122,233 |
|||||||||
Selling, general and administrative expenses |
59,922 |
57,078 |
38,347 |
|||||||||
Goodwill impairment |
26,492 |
- |
- |
|||||||||
Acquisition costs |
- |
8,504 |
- |
|||||||||
Total operating income (loss) |
(111,441) |
25,392 |
83,886 |
|||||||||
Interest expense |
52,666 |
50,096 |
29,943 |
|||||||||
Interest income |
(799) |
(494) |
(683) |
|||||||||
(Gain) loss on debt transactions |
(25,187) |
740 |
- |
|||||||||
Miscellaneous (income) expense, net |
366 |
(812) |
27 |
|||||||||
Total other expense, net |
27,046 |
49,530 |
29,287 |
|||||||||
Income (loss) before income taxes |
(138,487) |
(24,138) |
54,599 |
|||||||||
Income tax expense (benefit) |
419 |
14,951 |
(23,566) |
|||||||||
Net income (loss) |
$ |
(138,906) |
(39,089) |
78,165 |
||||||||
Earnings (loss) per common share |
||||||||||||
Basic earnings (loss) per common share |
$ |
(3.99) |
(1.19) |
2.82 |
||||||||
Diluted earnings (loss) per common share |
$ |
(3.99) |
(1.19) |
2.82 |
JAMES RIVER COAL COMPANY |
|||||||||||||||
AND SUBSIDIARIES |
|||||||||||||||
Consolidated Statements of Cash Flows |
|||||||||||||||
(in thousands) |
|||||||||||||||
Year Ended December 31, |
|||||||||||||||
2012 |
2011 |
2010 |
|||||||||||||
Cash flows from operating activities: |
|||||||||||||||
Net income (loss) |
$ |
(138,906) |
(39,089) |
78,165 |
|||||||||||
Adjustments to reconcile net income (loss) to net cash provided by |
|||||||||||||||
operating activities |
|||||||||||||||
Depreciation, depletion, and amortization |
131,779 |
108,914 |
64,368 |
||||||||||||
Accretion of asset retirement obligations |
5,279 |
4,477 |
3,334 |
||||||||||||
Amortization of debt discount and issue costs |
16,905 |
14,684 |
8,066 |
||||||||||||
Stock-based compensation |
5,219 |
5,283 |
5,400 |
||||||||||||
Deferred income tax expense (benefit) |
62 |
14,139 |
(22,236) |
||||||||||||
Loss (gain) on sale or disposal of property, plant, and equipment |
992 |
(59) |
307 |
||||||||||||
Goodwill impairment |
26,492 |
- |
- |
||||||||||||
(Gain) loss on debt transactions |
(25,187) |
740 |
- |
||||||||||||
Changes in operating assets and liabilities: |
|||||||||||||||
Receivables |
17,741 |
69,043 |
(16,681) |
||||||||||||
Inventories |
27,401 |
(13,967) |
(3,680) |
||||||||||||
Prepaid royalties and other current assets |
2,176 |
(104) |
(2,433) |
||||||||||||
Restricted cash and short term investments |
(7,048) |
(6,010) |
38,542 |
||||||||||||
Other assets |
3,767 |
566 |
(2,060) |
||||||||||||
Accounts payable |
(37,696) |
(3,145) |
10,828 |
||||||||||||
Accrued salaries, wages, and employee benefits |
(2,000) |
892 |
762 |
||||||||||||
Accrued taxes |
529 |
(889) |
(303) |
||||||||||||
Other current liabilities |
(4,514) |
7,497 |
1,066 |
||||||||||||
Workers' compensation benefits |
6,932 |
4,977 |
5,609 |
||||||||||||
Black lung benefits |
4,826 |
3,420 |
3,018 |
||||||||||||
Pension obligations |
(2) |
(1,696) |
(2,244) |
||||||||||||
Asset retirement obligations |
(1,884) |
(5,204) |
(809) |
||||||||||||
Other liabilities |
(415) |
(697) |
43 |
||||||||||||
Net cash provided by operating activities |
32,448 |
163,772 |
169,062 |
||||||||||||
Cash flows from investing activities: |
|||||||||||||||
Additions to property, plant, and equipment |
(81,556) |
(138,455) |
(95,426) |
||||||||||||
Payment for acquisition, net of cash acquired |
- |
(515,962) |
- |
||||||||||||
Proceeds from sale of property, plant and equipment |
631 |
103 |
82 |
||||||||||||
Net cash used in investing activities |
(80,925) |
(654,314) |
(95,344) |
||||||||||||
Cash flows from financing activities: |
|||||||||||||||
Proceeds from issuance of long-term debt |
- |
505,000 |
- |
||||||||||||
Repayment of long-term debt |
(23,848) |
(150,000) |
- |
||||||||||||
Net proceeds from issuance of common stock |
- |
170,545 |
- |
||||||||||||
Debt issuance costs |
- |
(15,668) |
(1,346) |
||||||||||||
Proceeds from exercise of stock options |
- |
- |
73 |
||||||||||||
Net cash provided by (used in) financing activities |
(23,848) |
509,877 |
(1,273) |
||||||||||||
Increase (decrease) in cash and cash equivalents |
(72,325) |
19,335 |
72,445 |
||||||||||||
Cash and cash equivalents at beginning of period |
199,711 |
180,376 |
107,931 |
||||||||||||
Cash and cash equivalents at end of period |
$ |
127,386 |
199,711 |
180,376 |
JAMES RIVER COAL COMPANY
AND SUBSIDIARIES
Reconciliation of Non-GAAP Measures
(in thousands)
(unaudited)
In addition to the results prepared in accordance with generally accepted accounting principles in the United States (GAAP) provided throughout this press release, management has presented the following non-GAAP financial measures, which management uses to gauge operating performance: EBITDA, adjusted EBITDA, adjusted EBITDA plus acquisition costs, adjusted net income (loss) and adjusted net income (loss) per share. These non-GAAP financial measures exclude various items detailed in the tables below "Reconciliation of EBITDA, Adjusted EBITDA and Adjusted EBITDA plus Acquisition Costs to Net Income (Loss)" and "Reconciliation of Adjusted Net Income (Loss) to Net Income (Loss)."
The definition of these non-GAAP measures may be changed periodically by management to adjust for significant items important to an understanding of operating trends. These measures are not intended to replace financial performance measures determined in accordance with GAAP. Rather, they are presented as supplemental measures of the Company's performance that management believes are useful to securities analysts, investors and others in assessing the Company's performance over time. Additionally, Adjusted EBITDA is used in several of the covenants in our revolving credit facility. Moreover, these measures are not calculated identically by all companies and therefore may not be comparable to similarly titled measures used by other companies. A reconciliation of each of these measures to its most directly comparable GAAP measure is provided in the tables below.
Reconciliation of EBITDA, Adjusted EBITDA and Adjusted EBITDA plus Acquisition Costs to Net Income (Loss)
Three Months Ended |
Twelve Months Ended |
|||||||||||||
December 31 |
December 31 |
December 31 |
December 31 |
|||||||||||
2012 |
2011 |
2012 |
2011 |
|||||||||||
Net income (loss) |
$ |
(76,932) |
(28,542) |
(138,906) |
(39,089) |
|||||||||
Income tax expense |
344 |
23,951 |
419 |
14,951 |
||||||||||
Interest expense |
12,554 |
13,423 |
52,666 |
50,096 |
||||||||||
Interest income |
(197) |
(138) |
(799) |
(494) |
||||||||||
Depreciation, depletion, and amortization |
33,627 |
33,435 |
131,779 |
108,914 |
||||||||||
EBITDA (before adjustments) |
$ |
(30,604) |
42,129 |
45,159 |
134,378 |
|||||||||
Other adjustments specified |
||||||||||||||
in our current debt agreement: |
||||||||||||||
Direct acquisition costs |
- |
- |
8,504 |
|||||||||||
Goodwill impairment |
26,492 |
- |
26,492 |
- |
||||||||||
(Gain) loss on debt transactions |
(2,956) |
- |
(25,187) |
740 |
||||||||||
Other |
2,098 |
2,026 |
8,204 |
8,200 |
||||||||||
Adjusted EBITDA |
$ |
(4,970) |
44,155 |
54,668 |
151,822 |
|||||||||
Write-up of IRP Inventory |
- |
- |
- |
2,749 |
||||||||||
Adjusted EBITDA plus acquisition costs |
$ |
(4,970) |
44,155 |
54,668 |
154,571 |
Reconciliation of Adjusted Net Income (Loss) to Net Income (Loss)
Three Months Ended |
Twelve Months Ended |
||||||||
December 31, |
December 31, |
December 31, |
December 31, |
||||||
2012 |
2011 |
2012 |
2011 |
||||||
Net Income (loss) |
$ |
(76,932) |
(28,542) |
(138,906) |
(39,089) |
||||
Goodwill impairment |
26,492 |
- |
26,492 |
- |
|||||
(Gain) loss on debt transactions |
(2,956) |
- |
(25,187) |
740 |
|||||
Items Related to IRP Acquisition |
|||||||||
Acquisition costs |
- |
- |
- |
8,504 |
|||||
Amortization of contracts included in depreciation, |
|||||||||
depletion and amortization |
(2,010) |
2,418 |
(436) |
5,935 |
|||||
Write-up to Fair Market Value of inventory at acquisition |
- |
- |
- |
2,749 |
|||||
Adjustment of prior year to include only current tax expense (1) |
- |
24,167 |
- |
14,134 |
|||||
Adjusted net income (loss) |
$ |
(55,406) |
(1,957) |
(138,037) |
(7,027) |
||||
Net income (loss) per share |
(2.21) |
(0.82) |
(3.99) |
(1.19) |
|||||
Adjusted net income (loss) per share |
$ |
(1.59) |
(0.06) |
(3.96) |
(0.21) |
||||
(1) This amount removes the impact of the valuation allowance recorded on the net deferred tax assets. |
CONTACT: |
James River Coal Company |
Elizabeth M. Cook |
|
Director of Investor Relations |
|
(804) 780-3000 |
SOURCE James River Coal Company
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