Alliance Resource Partners(US:ARLP)2025-11-07 21:34Sales and Production - The company sold 8,703 tons of coal in Q3 2025, a 3.9% increase from 8,379 tons in Q3 2024[130] - Coal production increased by 8.5% to 8,416 tons in Q3 2025 compared to 7,754 tons in Q3 2024[130] - Coal sales decreased to $1.47 billion for the 2025 Period compared to $1.61 billion for the 2024 Period, attributed to lower average coal sales prices and reduced tons sold[149] Revenue and Income - Total revenues decreased by 6.9% to $571.4 million in Q3 2025 from $613.6 million in Q3 2024, primarily due to lower coal sales prices[131] - Coal sales revenue fell to $511.6 million in Q3 2025, down 4.0% from $532.6 million in Q3 2024, attributed to a 7.5% decrease in average coal sales prices[133] - Net income attributable to the company rose by 10.2% to $95.1 million in Q3 2025, or $0.73 per unit, compared to $86.3 million, or $0.66 per unit, in Q3 2024[138] - Total revenues for the nine months ended September 30, 2025, decreased 10.7% to $1.66 billion compared to $1.86 billion for the same period in 2024, primarily due to lower coal sales and transportation revenues[149] - Net income attributable to ARLP for the 2025 Period was $228.5 million, or $1.76 per basic and diluted limited partner unit, down from $344.5 million, or $2.64 per unit, in the 2024 Period[154] Expenses and EBITDA - Segment Adjusted EBITDA increased by 7.8% to $207.2 million in Q3 2025 from $192.3 million in Q3 2024[139] - Segment Adjusted EBITDA for the 2025 Period decreased $84.8 million to $570.0 million from $654.8 million in the 2024 Period[155] - Labor and benefit expenses per ton produced decreased by 11.3% to $12.90 in Q3 2025 from $14.54 in Q3 2024[134] - Illinois Basin Coal Operations Segment Adjusted EBITDA decreased 8.1% to $105.4 million in the 2025 Quarter from $114.6 million in the 2024 Quarter, primarily due to lower average coal sales prices and higher operating expenses[143] - Appalachia Coal Operations Segment Adjusted EBITDA increased 44.2% to $54.1 million for the 2025 Quarter from $37.5 million in the 2024 Quarter, driven by reduced operating expenses despite lower coal sales volumes[144] Cash Flow and Capital Expenditures - Cash provided by operating activities was $507.3 million for the 2025 Period, down from $634.7 million in the 2024 Period, primarily due to decreased net income and unfavorable working capital changes[172] - Net cash used in investing activities decreased to $251.0 million for the 2025 Period from $337.4 million in the 2024 Period, mainly due to reduced capital expenditures and oil & gas reserves acquisitions[173] - Management projects total capital expenditures for 2025 to be in the range of $285.0 million to $320.0 million, with average estimated annual maintenance capital expenditures of approximately $7.28 per ton produced[175] Risk Factors - The company has significant exposure to commodity price risk due to long-term coal sales contracts, which are subject to price adjustments based on specified indices[179] - The company has not utilized commodity price-hedges or other derivatives related to sales price or supply cost risks but may consider doing so in the future[184] - Credit risk is primarily with domestic electric power generators and reputable global brokerage firms, with measures in place to evaluate and monitor customer creditworthiness[185] - The company does not have material exposure to currency exchange-rate risks as almost all transactions are denominated in U.S. dollars[186] - Borrowings under the Revolving Credit Facility and Securitization Facility are at variable rates, exposing the company to interest rate risk[187] - The company anticipates significant cash requirements over the long term, which may necessitate incurring debt or seeking additional equity capital[175] - The availability and cost of additional capital will depend on market conditions, the market price of common units, and the company's financial condition[175]