Alliance Resource Partners(ARLP) - 2021 Q1 - Quarterly Report

Financial Performance - Net income attributable to Alliance Resource Partners, L.P. for Q1 2021 was $24.7 million, a significant increase of $169.5 million compared to a net loss of $144.8 million in Q1 2020[108]. - Total revenues for Q1 2021 decreased to $318.6 million, down 9.2% from $350.8 million in Q1 2020, primarily due to reduced coal sales volumes and price realizations[109]. - Segment Adjusted EBITDA decreased by $1.9 million, or 1.7%, to $109.8 million in the 2021 Quarter compared to $111.7 million in the 2020 Quarter[123]. - Consolidated Segment Adjusted EBITDA for Q1 2021 was $109.8 million, a decrease of 1.6% from $111.7 million in Q1 2020[133]. - Cash provided by operating activities decreased to $54.6 million in Q1 2021 from $78.7 million in Q1 2020, primarily due to unfavorable working capital changes[139]. Coal Sales and Operations - Coal sales decreased by $27.1 million or 8.6% to $287.5 million in Q1 2021, with tons sold declining to 6.8 million from 7.3 million in Q1 2020[113]. - Average coal sales price realizations fell by 3.0% to $42.10 per ton in Q1 2021, compared to $43.39 per ton in Q1 2020[113]. - Illinois Basin Coal Operations Segment Adjusted EBITDA increased by 33.1% to $57.7 million in the 2021 Quarter, despite an 8.3% decrease in coal sales to $182.6 million[128]. - Appalachia Coal Operations Segment Adjusted EBITDA decreased by 33.4% to $31.5 million in the 2021 Quarter, with coal sales down 9.3% to $104.8 million[128]. - Total coal sales decreased by 8.6% to $287.5 million in the 2021 Quarter from $314.6 million in the 2020 Quarter[123]. Expenses and Cost Management - Segment Adjusted EBITDA Expense for coal operations decreased by 15.7% to $202.9 million in Q1 2021, with a per ton expense of $29.72, down from $33.20 in Q1 2020[114]. - Labor and benefit expenses per ton produced decreased by 13.2% to $9.43 in Q1 2021, reflecting ongoing efficiency initiatives[114]. - Maintenance expenses per ton produced decreased by 29.9% to $2.56 in Q1 2021, primarily due to reduced maintenance costs at longwall mining operations[116]. - Depreciation, depletion, and amortization expense decreased to $59.2 million in Q1 2021 from $73.9 million in Q1 2020, attributed to reduced sales volumes[119]. - Segment Adjusted EBITDA Expense decreased by 15.8% to $197.7 million in the 2021 Quarter from $234.7 million in the 2020 Quarter[123]. Capital and Liquidity - Capital expenditures decreased to $31.4 million in Q1 2021 from $50.4 million in Q1 2020[141]. - Total capital expenditures for 2021 are estimated to be in the range of $120.0 million to $125.0 million[142]. - The company had $34.4 million in cash and cash equivalents as of March 31, 2021[142]. - The revolving credit facility was $537.75 million, reducing to $459.5 million on May 23, 2021, with $461.0 million available for borrowing[145]. - The debt to cash flow ratio was 1.43 to 1.0 for the trailing twelve months ended March 31, 2021, remaining in compliance with the covenants of the Credit Agreement[147]. Shareholder Returns and Distributions - The company has repurchased a total of $93.5 million of common units under its unit repurchase program since inception[138]. - Quarterly distributions to unitholders will resume in May 2021 after being suspended in May 2020[140]. Market and Risk Factors - The company has significant long-term coal sales contracts, which are subject to price adjustment provisions based on specified indices or production costs[161]. - The company has exposure to coal and oil & gas sales prices, with risks associated with declining prices impacting royalty revenues[161]. - Credit risk is primarily with domestic electric power generators and reputable global brokerage firms, with measures in place to evaluate and monitor customer creditworthiness[163]. - Almost all transactions are denominated in U.S. dollars, minimizing exposure to currency exchange-rate risks, but foreign competitors may gain advantages from currency fluctuations[164][165]. - The company has not utilized commodity price-hedges or derivatives related to sales price or supply cost risks but may consider doing so in the future[162].