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Section 1: 8-K (8-K)

felp-8k_20180307.htm

 

UNITED STATES

SECURITIES AND EXCHANGE

COMMISSION

WASHINGTON, DC 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported): March 7, 2018

 

 

FORESIGHT ENERGY LP

(Exact Name of Registrant as Specified in Charter)

 

 

Delaware

 

001-36503

 

80-0778894

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

211 North Broadway, Suite 2600

Saint Louis, MO

 

 

 

63102

(Address of Principal Executive Offices)

 

 

 

(Zip Code)

 

(314) 932-6160

(Registrant’s telephone number, including area code)

 (Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (Section 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (Section 240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicated by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

 

 

 


 

 

ITEM 2.02

RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On March 7, 2018, Foresight Energy LP (the “Partnership”) announced via press release its earnings and operating results for the fourth quarter and full year 2017.  A copy of the Partnership’s press release is attached hereto as Exhibit 99.1.

The information in this Current Report on Form 8-K (including the exhibits attached hereto) is being furnished under Item 2.02 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of such section or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

ITEM 9.01

FINANCIAL STATEMENTS AND EXHIBITS.

 

(d)

Exhibits

 

 

99.1 Press release issued by Foresight Energy LP on March 7, 2018.

 

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

Foresight Energy LP

 

 

By:

 

Foresight Energy GP LLC,

 

 

its general partner

 

 

By:

 

/s/ Robert D. Moore

 

 

Robert D. Moore

 

 

President and Chief Executive Officer

 

 

Date: March 7, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Section 2: EX-99.1 (EX-99.1)

felp-ex991_6.htm

 

 

Exhibit 99.1

Foresight Energy LP Reports Full-Year1 and Fourth Quarter 2017 Results

 

Full-Year 2017 Highlights:

 

Coal sales of $944.4 million on sales volumes of 21.4 million tons, respective increases of 9% and 11% compared to prior year.

Adjusted EBITDA of $293.8 million.

Cash flows from operations of $144.5 million.

Net loss attributable to limited partner units of $215.2 million.  Net loss includes $95.5 million of debt restructuring charges and $42.7 million of asset impairment charges related to the March 2015 Hillsboro Energy, LLC combustion event.  

Paid cash distributions to common unitholders totaling $9.7 million, or $0.1252 per unit, during 2017 and declared a $0.0565 per unit distribution from retained excess cash flow, to be paid on March 30, 2018 to unitholders of record as of March 20, 2018.  

Excess Cash Flow Sweep of $55.7 million to be applied to first lien debt in 2018.

 

ST.  LOUIS, Missouri (BUSINESS WIRE) March 7, 2018 — Foresight Energy LP (“Foresight” or the “Partnership”) (NYSE: FELP) today reported financial and operating results for the fourth quarter and year ended December 31, 2017.  Foresight generated fiscal year coal sales revenues of $944.4 million on sales volumes of 21.4 million tons resulting in a net loss attributable to limited partner units of $215.2 million, Adjusted EBITDA of $293.8 million and cash flows from operations of $144.5 million.  Annual sales volumes for 2017 increased 11% compared to 2016 sales volumes as more tons were sold into the export market.  Overall results for 2017 were negatively impacted by $95.5 million of expense related to the early extinguishment of debt resulting from the March 2017 refinancing transaction.  Also negatively impacting the 2017 results is impairment expense totaling $42.7 million for certain underground mining equipment that was permanently sealed within, or deemed to be unrecoverable from, Hillsboro Energy, LLC’s (“Hillsboro”) Deer Run Mine related to the re-entry plan that was submitted to MSHA in December 2017.  Partially offsetting these charges were insurance recoveries totaling $16.4 million related to the 2015 combustion event at the Hillsboro operation.  The insurance recoveries included $12.8 million for business interruption proceeds, which was recorded in other operating income, and $3.6 million for ongoing mitigations costs, which was recorded as a reduction in cost of coal sales.    

 

“Financial and operating results for 2017 showed significant improvement over the prior year driven primarily by a stronger year-over-year export market.  The improvements in tons sold and revenue allowed Foresight to generate over $293 million of Adjusted EBITDA and nearly $145 million of cash from operations.  Operationally, we safely and efficiently produced 21.2 million tons during the year, an increase of 11% compared to the prior year.  Foresight’s operating mines also retained their position among the most productive and lowest cost underground mines in the country,” stated Mr. Robert D. Moore, Chairman, President, and Chief Executive Officer.

 

Foresight also announced that due to the Partnership’s strong operating performance during the fourth quarter, the Board of Directors of its General Partner approved a quarterly cash distribution of $0.0565 per unit from retained excess cash flow.  The distribution is payable on March 30, 2018 for unitholders of record on March 20, 2018.  In addition, an excess cash flow sweep payment of $55.7 million will be applied to the Partnership’s first lien debt in 2018.

 

Consolidated Financial Results

 

Year Ended December 31, 2017 Compared to Year Ended December 31, 2016

 

Coal sales totaled $944.4 million for 2017 compared to $866.6 million for 2016, representing an increase of $77.8 million, or 9%.  The increase in coal sales revenues was driven by a nearly 11%, or 2.1 million, increase in tons sold.  Slightly offsetting this increase was a nearly 2%, or $0.77 per ton, decrease in coal sales realizations.  The improvement in tons sold was principally the result of an improved export

 

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market in 2017 compared to 2016.  The decrease in coal sales realizations per ton was principally driven by the expiration and repricing of certain higher priced contracts, which was partially offset by higher realized export prices and volumes.  

 

Cost of coal produced was $485.6 million, or $22.85 per ton sold, for 2017 compared to $424.0 million, or $22.32 per ton sold, for 2016.  The increase in cost of coal produced was primarily due to higher sales volumes during the 2017 year compared to the 2016 year.  The slight increase in per ton costs during the current year was driven largely by an $8.9 million non-cash increase to the fair value of inventory due to the application of pushdown accounting.  Additionally, results for the 2016 year included the benefit of $10.5 million of insurance recoveries related to direct mitigation costs in 2015 and 2016 from the Hillsboro combustion event.     

 

Transportation costs increased $23.8 million from $139.7 million in 2016 to $163.5 million in 2017.  The increase in fiscal year 2017 compared to fiscal year 2016 was due to higher sales volumes and an increase in the proportion of tons sold to the export market.  During 2017, 27% of coal sales volumes were shipped to the export market compared to 17% during 2016.      

 

During the year ended December 31, 2017, Foresight recognized depreciation, depletion and amortization expense of $207.1 million compared to $164.2 million during the year ended December 31, 2016.  The increase of $42.9 million is due to the increase in fair market value of assets resulting from the application of pushdown accounting.  

 

Selling, general and administrative expense increased $4.8 million from $25.3 million in 2016 to $30.1 million in 2017.  The increase is primarily due to increases in the management services agreement between Foresight and Murray Energy Corporation (“Murray Energy”) resulting from the March 2017 refinancing transaction and Murray Energy exercising its option to acquire majority ownership of Foresight’s general partner.  

 

During the year ended December 31, 2017, Foresight recorded impairment charges totaling $42.7 million associated with certain longwall mining equipment that was permanently sealed within, or deemed to be unrecoverable from Hillsboro’s Deer Run mine.  During the year ended December 31, 2016, Foresight recorded impairment charges of $74.6 million related to certain prepaid royalty assets for which recoupment was deemed to be improbable.

 

The fiscal year 2017 included losses on commodity contracts totaling $4.1 million compared to losses of $23.8 million for fiscal year 2016.  The decreased loss during the current year was principally due to a less significant increase in the API2 curve during 2017 compared to 2016 as well as a year over year decline in the notional value of the open commodity contracts.  

 

Other operating income during the year ended December 31, 2017, totaled $13.1 million, a decrease of $9.1 million compared to the $22.2 million recognized during the year ended December 31, 2016.  The decrease in other operating income is principally the result of the receipt of $12.8 million in payments during the current year from insurance companies related to business interruption from the Hillsboro combustion event compared to $20.0 million in payments received during the 2016 year period.  

 

Interest expense during fiscal year 2017 increased $2.1 million compared to interest expense during fiscal year 2016.  The increase was due primarily to higher interest costs resulting from the August 2016 debt restructuring transaction, as the prior second lien notes and 2017 Exchangeable PIK Notes outstanding through the first quarter 2017 carried a substantially higher effective interest rate than senior notes they replaced.    

 

Associated with the March 2017 refinancing transaction, Foresight recognized $95.5 million of expense related to the early extinguishment of debt.  Included in this amount was $57.6 million of expense related to the make-whole/equity-claw premiums and other costs to retire the prior second lien notes and the early write-off of $37.9 million of unamortized debt discounts and debt issuance costs from the retired debt.  Comparatively, during 2016 Foresight recognized $13.2 million of expense related to the early extinguishment of debt resulting from the August 2016 refinancing transaction.  Also, as part of the August 2016 transaction, Foresight realized $21.8 million of debt restructuring costs.  

 

During 2017, Foresight generated operating cash flows of $144.5 million and ended the year with $2.2 million in cash and $161.0 million of available borrowing capacity, net of outstanding letters of credit, under its revolving credit facility.  Capital expenditures for the year ended December 31, 2017 totaled $76.5 million compared $54.6 million for the year ended December 31, 2016.  The $21.9 million increase in capital expenditures was primarily the result of returning to normal maintenance spending levels following 2016, where capital was conserved through the debt restructuring process.

 

 

 


 

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Three Months Ended December 31, 2017 Compared to Three Months Ended December 31, 2016

 

Coal sales were $282.4 million for the three months ended December 31, 2017 compared to $251.0 million for the prior year period.  This change was driven by a 0.8 million ton increase in total tons sold, offset by a $1.45 per ton decrease in sales realizations per ton.  The decrease in coal sales realizations per ton was principally driven by the expiration and repricing of certain higher priced contracts, which was partially offset by higher realized export prices and volumes.  

 

Cost of coal produced for the three months ended December 31, 2017 was $139.2 million compared to $112.4 million for the three months ended December 31, 2016.  The increase in cost of coal produced was principally driven by a 1.1 million ton increase in produced tons sold during the quarter.  

 

Guidance for 2018

 

Based on Foresight’s contracted position, recent performance, and its current outlook on pricing and the coal markets in general, the Partnership is providing the following guidance for 2018:

 

Sales Volumes – Based on current committed position and expectations for the remainder of 2018, Foresight is projecting sales volumes to be between 21.5 and 22.8 million tons, with over 5.0 million tons expected to be sold into the international market.  

 

Adjusted EBITDA – Based on the projected sales volumes and operating cost structure, Foresight currently expects to generate Adjusted EBITDA in a range of $280 to $310 million.

 

Capital Expenditures – Total 2018 capital expenditures are estimated to be between $70 and $80 million.  

 

Forward-Looking Statements

 

This press release contains forward-looking statements within the meaning of the federal securities laws.  These statements contain words such aspossible, intend, will, if and expect” and can be impacted by numerous factors, including risks relating to the securities markets, the impact of adverse market conditions affecting business of the Partnership, adverse changes in laws including with respect to tax and regulatory matters and other risks.  There can be no assurance that actual results will not differ from those expected by management of the Partnership.  Known material factors that could cause actual results to differ from those in the forward-looking statements are described in Part I, Item 1A.  Risk Factors of the Partnerships Annual Report on Form 10-K filed on March 12017.  The Partnership undertakes no obligation to update or revise such forward-looking statements to reflect events or circumstances that occur, or which the Partnership becomes aware of, after the date hereof.

 

Non-GAAP Financial Measures

 

Adjusted EBITDA is a non-GAAP supplemental financial measure that management and external users of the Partnership’s consolidated financial statements, such as industry analysts, investors, lenders and rating agencies, may use to assess:

 

the Partnerships operating performance as compared to other publicly traded partnerships, without regard to historical cost basis or, in the case of Adjusted EBITDA, financing methods;

the Partnerships ability to incur and service debt and fund capital expenditures; and

the viability of acquisitions and other capital expenditure projects and the returns on investment of various expansion and

growth opportunities.

 

The Partnership defines Adjusted EBITDA as net income (loss) attributable to controlling interests before interest, income taxes, depreciation, depletion, amortization and accretion.  Adjusted EBITDA is also adjusted for equity-based compensation, losses/gains on commodity derivative contracts, settlements of derivative contracts, a change in the fair value of the warrant liability and material nonrecurring or other items which may not reflect the trend of future results.  As it relates to commodity derivative contracts, the Adjusted EBITDA calculation removes the total impact of derivative gains/losses on net income (loss) during the period and then adds/deducts to Adjusted EBITDA the amount of aggregate settlements during the period.  

The Partnership believes the presentation of Adjusted EBITDA provides useful information to investors in assessing the Partnership’s financial condition and results of operations.  Adjusted EBITDA should not be considered an alternative to net (loss) income, operating income, cash flow from operations, or any other measure of financial performance presented in accordance with U.S. GAAP, nor should Adjusted EBITDA be considered an alternative to operating surplus, adjusted operating surplus or other definitions in the Partnership’s partnership agreement.  Adjusted EBITDA has important limitations as an analytical tool because it

 

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excludes some, but not all, of the items that affects net (loss) income.  Additionally, because Adjusted EBITDA may be defined differently by other companies in the industry, and the Partnerships definition of Adjusted EBITDA may not be comparable to similarly titled measures of other companies, the utility of such a measure is diminished.  For a reconciliation of Adjusted EBITDA to net (loss) income attributable to controlling interests, please see the table below.

 

This press release references forward-looking estimates of Adjusted EBITDA projected to be generated by the Partnership during the year ending December 31, 2018. A reconciliation of estimated 2018 Adjusted EBITDA to U.S. GAAP net income (loss) is not provided because U.S. GAAP net income (loss) for the projection period is not practical to assess due to unknown variables and uncertainty related to future results. In recent years, the Partnership has recognized significant asset impairment charges, transition and reorganization costs, losses on early extinguishment of debt, and debt restructuring costs.  While these items affect U.S. GAAP net income (loss), they are generally excluded from Adjusted EBITDA. Therefore these items do not materially impact the Partnership’s ability to forecast Adjusted EBITDA.

 

About Foresight Energy LP

 

Foresight is a leading producer and marketer of thermal coal controlling over 2 billion tons of coal reserves in the Illinois Basin. Foresight currently operates two longwall mining complexes with three longwall mining systems (Williamson (one longwall mining system) and Sugar Camp (two longwall mining systems)), one continuous mining operation (Macoupin) and the Sitran river terminal on the Ohio River. Foresight’s operations are strategically located near multiple rail and river transportation access points, providing transportation cost certainty and flexibility to direct shipments to the domestic and international markets.

 

 

Contact

 

Gary M.  Broadbent

Director of Investor and Media Relations

740-338-3100

Investor.relations@foresight.com

Media@coalsource.com

 

 

 

 

1 

Foresight adopted pushdown accounting as of March 31, 2017 as a result of Murray Energy obtaining control of its general partner.  As required by pushdown accounting, the Partnership revalued its balance sheet on the change of control date and therefore certain financial statement line items are not comparable to prior periods.  As such, operational results prior to March 31, 2017 were recorded on the predecessor financial statements (the “Predecessor”).  Operational results subsequent to March 31, 2017 were recorded on the successor financial statements (the “Successor”).  References herein to the “Full-Year 2017”, the “year ended December 31, 2017”, the “fiscal year 2017”, and similar combine the operational results before and after March 31, 2017 to enhance the comparability of such information to the prior year.    

 

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Foresight Energy LP

Consolidated Balance Sheets

(In Thousands)

 

(Successor)

 

 

 

(Predecessor)

 

 

December 31,

 

 

 

December 31,

 

 

2017

 

 

 

2016

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

2,179

 

 

 

$

103,690

 

Accounts receivable

 

35,158

 

 

 

 

54,905

 

Due from affiliates

 

37,685

 

 

 

 

16,891

 

Financing receivables - affiliate

 

3,138

 

 

 

 

2,904

 

Inventories, net

 

40,539

 

 

 

 

43,052

 

Prepaid royalties

 

4,000

 

 

 

 

3,136

 

Deferred longwall costs

 

9,520

 

 

 

 

13,310

 

Coal derivative assets

 

 

 

 

 

7,650

 

Other prepaid expenses and current assets

 

10,844

 

 

 

 

21,443

 

Contract-based intangibles

 

11,268

 

 

 

 

 

Total current assets

 

154,331

 

 

 

 

266,981

 

Property, plant, equipment, and development, net

 

2,378,605

 

 

 

 

1,318,937

 

Due from affiliates

 

947

 

 

 

 

1,843

 

Financing receivables - affiliate

 

64,097

 

 

 

 

67,235

 

Prepaid royalties

 

1,250

 

 

 

 

13,765

 

Other assets

 

5,358

 

 

 

 

20,250

 

Contract-based intangibles

 

2,052

 

 

 

 

 

Total assets

$

2,606,640

 

 

 

$

1,689,011

 

Liabilities and partners’ capital (deficit)

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Current portion of long-term debt and capital lease obligations

$

109,532

 

 

 

$

368,993

 

Current portion of sale-leaseback financing arrangements

 

4,148

 

 

 

 

1,372

 

Accrued interest

 

13,410

 

 

 

 

29,760

 

Accounts payable

 

76,658

 

 

 

 

60,971

 

Accrued expenses and other current liabilities

 

62,442

 

 

 

 

43,592

 

Asset retirement obligations

 

4,416

 

 

 

 

7,273

 

Due to affiliates

 

13,324

 

 

 

 

20,904

 

Contract-based intangibles

 

28,688

 

 

 

 

 

Total current liabilities

 

312,618

 

 

 

 

532,865

 

Long-term debt and capital lease obligations

 

1,205,000

 

 

 

 

1,022,070

 

Sale-leaseback financing arrangements

 

196,496

 

 

 

 

190,497

 

Asset retirement obligations

 

39,655

 

 

 

 

37,644

 

Warrant liability

 

 

 

 

 

51,169

 

Other long-term liabilities

 

32,330

 

 

 

 

9,359

 

Contract-based intangibles

 

144,715

 

 

 

 

 

Total liabilities

 

1,930,814

 

 

 

 

1,843,604

 

Limited partners' capital (deficit):

 

 

 

 

 

 

 

 

Common unitholders (77,644 and 66,105 units outstanding as of December 31, 2017 and 2016, respectively)

 

421,161

 

 

 

 

100,628

 

Subordinated unitholders (64,955 units outstanding as of December 31, 2017 and 2016)

 

254,665

 

 

 

 

(255,221

)

Total limited partners' capital (deficit)

 

675,826

 

 

 

 

(154,593

)

Total liabilities and partners' capital (deficit)

$

2,606,640

 

 

 

$

1,689,011

 

 

 

 

 

 

 

 

 

 


 

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Foresight Energy LP

Consolidated Statements of Operations

(In Thousands, Except Per Unit Data)

 

 

(Unaudited)

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

(Successor)

 

 

(Predecessor)

 

 

(Successor)

 

 

(Predecessor)

 

 

Combined -

 

 

(Predecessor)

 

 

Three Months Ended December 31, 2017

 

 

Three Months Ended December 31, 2016

 

 

Period from April 1, 2017 through December 31, 2017

 

 

Period From January 1, 2017 through March 31, 2017

 

 

Period from January 1, 2017 through December 31, 2017

 

 

Year Ended December 31, 2016

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Coal sales

$

282,431

 

 

$

250,966

 

 

$

716,617

 

 

$

227,813

 

 

$

944,430

 

 

$

866,628

 

Other revenues

 

2,180

 

 

 

1,956

 

 

 

7,527

 

 

 

2,581

 

 

 

10,108

 

 

 

9,204

 

Total revenues

 

284,611

 

 

 

252,922

 

 

 

724,144

 

 

 

230,394

 

 

 

954,538

 

 

 

875,832

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of coal produced (excluding depreciation, depletion and amortization)

 

139,215

 

 

 

112,437

 

 

 

367,844

 

 

 

117,762

 

 

 

485,606

 

 

 

423,995

 

Cost of coal purchased

 

 

 

 

12,807

 

 

 

 

 

 

7,973

 

 

 

7,973

 

 

 

13,541

 

Transportation

 

58,100

 

 

 

42,980

 

 

 

125,772

 

 

 

37,726

 

 

 

163,498

 

 

 

139,659

 

Depreciation, depletion and amortization

 

64,503

 

 

 

38,691

 

 

 

167,794

 

 

 

39,298

 

 

 

207,092

 

 

 

164,212

 

Contract amortization

 

8,286

 

 

 

 

 

 

1,408

 

 

 

 

 

 

1,408

 

 

 

 

Accretion on asset retirement obligations

 

725

 

 

 

844

 

 

 

2,179

 

 

 

710

 

 

 

2,889

 

 

 

3,376

 

Selling, general and administrative

 

8,420

 

 

 

6,618

 

 

 

23,555

 

 

 

6,554

 

 

 

30,109

 

 

 

25,265

 

Long-lived asset impairments

 

42,667

 

 

 

74,575

 

 

 

42,667

 

 

 

 

 

 

42,667

 

 

 

74,575

 

Transition and reorganization costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,889

 

Loss on commodity derivative contracts

 

389

 

 

 

6,482

 

 

 

2,607

 

 

 

1,492

 

 

 

4,099

 

 

 

23,752

 

Other operating (income) loss, net

 

1

 

 

 

(20,037

)

 

 

(13,537

)

 

 

451

 

 

 

(13,086

)

 

 

(22,161

)

Operating (loss) income

 

(37,695

)

 

 

(22,475

)

 

 

3,855

 

 

 

18,428

 

 

 

22,283

 

 

 

22,729

 

Other expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

36,496

 

 

 

43,932

 

 

 

107,904

 

 

 

43,380

 

 

 

151,284

 

 

 

149,201

 

Debt restructuring costs

 

 

 

 

119

 

 

 

 

 

 

 

 

 

 

 

 

21,821

 

Change in fair value of warrants

 

 

 

 

18,576

 

 

 

 

 

 

(9,278

)

 

 

(9,278

)

 

 

17,124

 

(Gain) Loss on early extinguishment of debt

 

 

 

 

(90

)

 

 

 

 

 

95,510

 

 

 

95,510

 

 

 

13,203

 

Net loss

 

(74,191

)

 

 

(85,012

)

 

 

(104,049

)

 

 

(111,184

)

 

 

(215,233

)

 

 

(178,620

)

Less: net income attributable to noncontrolling interests

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

169

 

Net loss attributable to limited partner units

$

(74,191

)

 

$

(85,012

)

 

$

(104,049

)

 

$

(111,184

)

 

$

(215,233

)

 

$

(178,789

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss available to limited partner units - basic and diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common unitholders

$

(38,256

)

 

$

(42,881

)

 

$

(52,143

)

 

$

(56,259

)

 

$

(108,402

)

 

$

(90,015

)

Subordinated unitholders

$

(35,935

)

 

$

(42,131

)

 

$

(51,906

)

 

$

(54,925

)

 

$

(106,831

)

 

$

(88,774

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per limited partner unit - basic and diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common unitholders

$

(0.49

)

 

$

(0.65

)

 

$

(0.68

)

 

$

(0.85

)

 

n/a

 

 

$

(1.37

)

Subordinated unitholders

$

(0.55

)

 

$

(0.65

)

 

$

(0.80

)

 

$

(0.85

)

 

n/a

 

 

$

(1.37

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average limited partner units outstanding - basic and diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common units

 

77,644

 

 

 

66,105

 

 

 

77,145

 

 

 

66,533

 

 

n/a

 

 

 

65,829

 

Subordinated units

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

n/a

 

 

 

64,955

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Distributions declared per limited partner unit

$

0.0605

 

 

$

 

 

$

0.1252

 

 

$

 

 

$

0.1252

 

 

$

 


 

6

 

 


 

 

Foresight Energy LP

Consolidated Statements of Cash Flows

(In Thousands)

 

(Successor)

 

 

(Predecessor)

 

 

(Predecessor)

 

 

(Predecessor)

 

 

Period from April 1, 2017 through December 31, 2017

 

 

Period From January 1, 2017 through March 31, 2017

 

 

Year Ended December 31, 2016

 

 

Year Ended December 31, 2015

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(104,049

)

 

$

(111,184

)

 

$

(178,620

)

 

$

(38,684

)

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

167,794

 

 

 

39,298

 

 

 

164,212

 

 

 

195,415

 

Amortization of debt issuance costs and debt discount

 

1,927

 

 

 

6,365

 

 

 

12,580

 

 

 

6,878

 

Contract amortization

 

1,408

 

 

 

 

 

 

 

 

 

 

Equity-based compensation

 

575

 

 

 

318

 

 

 

5,106

 

 

 

13,704

 

Loss (gain) on commodity derivative contracts

 

2,607

 

 

 

1,492

 

 

 

23,752

 

 

 

(45,691

)

Settlements of commodity derivative contracts

 

(172

)

 

 

3,724

 

 

 

12,644

 

 

 

61,223

 

Realized gains on commodity derivative contracts included in investing activities

 

 

 

 

(3,520

)

 

 

 

 

 

(19,073

)

Change in fair value of warrants

 

 

 

 

(9,278

)

 

 

17,124

 

 

 

 

Long-lived asset impairments

 

42,667

 

 

 

 

 

 

74,575

 

 

 

12,592

 

Transition and reorganization expenses paid by Foresight Reserves (affiliate)

 

 

 

 

 

 

 

2,333

 

 

 

10,032

 

Current period interest expense converted into debt

 

 

 

 

 

 

 

31,484

 

 

 

 

Non-cash debt extinguishment expense

 

 

 

 

95,510

 

 

 

11,124

 

 

 

 

Non-cash impact of recording coal inventory to fair value in pushdown accounting

 

8,868

 

 

 

 

 

 

 

 

 

 

Other

 

245

 

 

 

1,321

 

 

 

4,897

 

 

 

5,208

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

52

 

 

 

19,695

 

 

 

6,420

 

 

 

19,586

 

Due from/to affiliates, net

 

(14,321

)

 

 

(13,157

)

 

 

12,940

 

 

 

(25,345

)

Inventories

 

4,788

 

 

 

(917

)

 

 

7,858

 

 

 

27,994

 

Prepaid expenses and other assets

 

(46

)

 

 

(2,375

)

 

 

(7,608

)

 

 

(250

)

Prepaid royalties

 

1,368

 

 

 

(241

)

 

 

(15,790

)

 

 

(18,945

)

Commodity derivative assets and liabilities

 

633

 

 

 

(532

)

 

 

3,938

 

 

 

(1,911

)

Accounts payable

 

8,363

 

 

 

7,324

 

 

 

5,779

 

 

 

(5,014

)

Accrued interest

 

8,961

 

 

 

(9,803

)

 

 

22,905

 

 

 

(562

)

Accrued expenses and other current liabilities

 

(11,574

)

 

 

(3,430

)

 

 

5,537

 

 

 

874

 

Other

 

1,963

 

 

 

1,782

 

 

 

2,030

 

 

 

2,381

 

Net cash provided by operating activities

 

122,057

 

 

 

22,392

 

 

 

225,220

 

 

 

200,412

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment in property, plant, equipment and development

 

(56,547

)

 

 

(19,908

)

 

 

(54,584

)

 

 

(85,026

)

Investment in financing arrangements with Murray Energy (affiliate)

 

 

 

 

 

 

 

 

 

 

(75,000

)

Settlement of certain coal derivatives

 

 

 

 

3,520

 

 

 

 

 

 

19,073

 

Return of investment on financing arrangements with Murray Energy (affiliate)

 

2,199

 

 

 

705

 

 

 

2,689

 

 

 

2,172

 

Acquisition of an affiliate

 

 

 

 

 

 

 

(100

)

 

 

 

Proceeds from sale of equipment

 

 

 

 

1,898

 

 

 

4,366

 

 

 

 

Net cash used in investing activities

 

(54,348

)

 

 

(13,785

)

 

 

(47,629

)

 

 

(138,781

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net change in borrowings under revolving credit facility

 

 

 

 

(352,500

)

 

 

 

 

 

33,000

 

Net change in borrowings under A/R securitization program

 

(21,200

)

 

 

7,000

 

 

 

(26,800

)

 

 

41,000

 

Proceeds from long-term debt and capital lease obligations

 

 

 

 

1,234,438

 

 

 

 

 

 

59,325

 

Payments on long-term debt and capital lease obligations

 

(33,971

)

 

 

(970,721

)

 

 

(45,692

)

 

 

(44,440

)

Payments on short-term debt

 

(3,631

)

 

 

 

 

 

(739

)

 

 

(2,559

)

Proceeds from issuance of common units to Murray Energy (affiliate)

 

 

 

 

60,586

 

 

 

 

 

 

 

Distributions paid

 

(9,725

)

 

 

 

 

 

(182

)

 

 

(152,352

)

Debt extinguishment costs

 

 

 

 

(57,645

)

 

 

 

 

 

 

Debt issuance costs paid

 

 

 

 

(27,328

)

 

 

(15,735

)

 

 

(2,751

)

Other

 

(1,238

)

 

 

(1,892

)

 

 

(2,291

)

 

 

(1,825

)

Net c