Cloud Peak Energy reported adjusted EBITDA of US$201.9 million for 2014, down from US$218.6 million for 2013 as the company was hit by lower coal prices and reduced shipments of coal due to poor rail performance.
The company shipped 85.9 million short t from its owned and operated mines compared to its contracted position of 90 million short t. By 4Q14, railway performance had improved resulting in shipments of 23.3 million short t for the quarter – up from 21.7 million short t in 3Q13 – a trend that is continuing into 2015 as customers rebuild depleted stockpiles.
Exports were also hit by rail service issues, as well as the company’s decision to only deliver on existing contracts rather than seeking further sales at the prevailing low export prices. As a result, shipments were 14% down through Westshore Terminal compared to 2013.
The company has committed to sell 80 million short t in 2015 as it expects total US demand for coal to fall on 2014 levels due to low natural gas prices and some plant closures resulting from the implementation of the Mercury and Air Toxics Standards, although demand for its Powder River Basin coal is forecast to remain relatively stable.
“We continue our focus on matching our production with the market demand,” said Colin Marshall, President and CEO of Cloud Peak. “We will stay focused on controlling costs without underinvesting in the maintenance of our equipment. I am confident that our strong balance sheet with lower liabilities and good liquidity will allow us to work through these difficult markets.”
Written by Jonathan Rowland.
Read the article online at: https://www.worldcoal.com/coal/18022015/cloud-peak-reports-2014-results-1909/