CNX Coal Resources LP reported its financial and operating results for 3Q15. Net income totalled US$14.7 million for the quarter, adjusted EBITDA was US$24.3 million and the company has a distributed cash flow of US$15.4 million.
"CNXC delivered a very strong operational and financial third quarter despite the ongoing challenges in the coal markets," commented Jimmy Brock, CEO of CNX Coal Resources GP LLC. "Although the commodity price environment has deteriorated further since our initial public offering, we remain focused on generating significant distributable cash flow as demonstrated during the quarter. We believe that we have significant dropdown opportunities at the Pennsylvania mining complex due to the strong commitment from our sponsor. Our solid balance sheet and strong cash flow generating assets also provide us significant financial flexibility."
For CNX’s 20% undivided interest in the Pennsylvania mining complex, it sold 1.13 million short t of coal during 3Q15, exceeding its guidance of 1.08 – 1.12 million short t. Total production saw a decrease to 1.16 million short t compared to 1.27 million short t produced in 3Q14 as a result of aligning production with market conditions.
The company has indicated it expects mines to continue running on a four-day work week for the rest of 2015.
Total unit costs for coal sold in 3Q15 were US$40.38/short t, compared to US$47.32/short t in 3Q15. The company reported this increase to be driven by firm longwall performance, consistent shipment rates reduced workforce and other cost reduction efforts.
Brock added: "Our marketing team has made substantial progress on the thermal coal marketing front during the quarter. CNXC has increased its contracted coal sales position for 2016 to 74% of the projected sales. For 2017 and 2018, the average contracted sales position has improved to an average of 43%. These commitments have secured CNXC as the anchor supplier to the largest, most efficient, and most environmentally compliant coal power plants in our core markets. Furthermore, we have secured multi-year commitments with key power plants in the upper Midwest and Southeast, which has historically been thought of as the domain of other coal basins. The solid contracting book helps us reduce volume volatility and attain economies of scale to run the mines more efficiently."
Edited from press release by Harleigh Hobbs
Read the article online at: https://www.worldcoal.com/coal/27102015/cnx-coal-resources-financial-and-operating-results-for-3q15-3072/