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Section 1: 8-K (8-K)

felp-8k_20181107.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): November 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 November 7, 2018, Foresight Energy LP (the “Partnership”) announced via press release its earnings and operating results for the third quarter 2018.  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 November 7, 2018.

 

 

2


 

 

 

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

 

 

Chairman of the Board, President and

Chief Executive Officer

 

 

Date: November 7, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

felp-ex991_6.htm

 

 

Exhibit 99.1

Foresight Energy LP Reports Third Quarter 20181 Results

 

Third Quarter 2018 Highlights:

 

Coal sales of nearly $292 million, an increase of 27% compared to the third quarter 2017 and an increase of 8% compared to the second quarter 2018, on higher sales volumes of 6.1 million tons and higher sales realization per ton sold

Adjusted EBITDA of $57.6 million, which includes a $25 million charge related to the settlement of litigation related to Hillsboro Energy and Macoupin Energy

Cash flows from operations of $51.3 million

 

Net loss attributable to limited partner units of $27.7 million, or ($0.17) per common unit and ($0.22) per subordinated unit.

Declared a $0.0565 per unit distribution from retained excess cash flow generated in 2017, to be paid on December 21, 2018 to unitholders of record as of December 11, 2018.

 

ST.  LOUIS, Missouri (BUSINESS WIRE) November 7, 2018 — Foresight Energy LP (“Foresight” or the “Partnership”) (NYSE: FELP) today reported financial and operating results for the third quarter ended September 30, 2018.  Foresight generated coal sales revenues of nearly $292 million on sales volumes of 6.1 million tons resulting in a net loss attributable to limited partner units of $27.7 million, Adjusted EBITDA of $57.6 million, and cash flows from operations of $51.3 million.  Net loss attributable to limited partner units and Adjusted EBITDA include $25 million in charges related to the settlement of litigation with Natural Resource Partners L.P. (“NRP”) related to matters at Hillsboro Energy and Macoupin Energy.  

 

“During the third quarter, we continued to take advantage of a strong export market and an improved domestic spot market to realize significant year-over-year improvements in our sales volumes,” said Mr. Robert D. Moore, Chairman, President and Chief Executive Officer.  “With our unique access to international and domestic markets, plus our industry-leading cost structure, Foresight remains well-positioned to continue to opportunistically place its thermal coal production and to capture solid margins.  Regarding the settlement of litigation with NRP, we are pleased to have reached a mutually beneficial resolution to these lawsuits, which provides us with future operational flexibility at Hillsboro Energy, while significantly reducing the lease holding cost.”

 

Foresight also announced that due to the Partnership’s operating performance during the third 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 December 21, 2018 for unitholders of record on December 11, 2018.  

 

Third Quarter Consolidated Financial Results

 

Coal sales totaled nearly $292.0 million for the third quarter 2018 compared to $229.7 million for the third quarter 2017, representing an increase of $62.3 million, or 27%.  The increase in coal sales revenues was due to higher coal sales volumes combined with higher coal sales realization per ton sold.  Coal sales volumes and coal sales realization per ton sold were higher due to increased export sales, which experienced more favorable API2 pricing during 2018.  

 

Cost of coal produced was $133.7 million, or $22.28 per ton sold, for the third quarter 2018 compared to $122.8 million, or $23.43 per ton sold, for the third quarter 2017.  The increase in total cost of production was due to an increase in produced tons sold offset by a lower cash cost per ton sold. The lower cash cost per ton sold resulted from no longwall moves occurring during the third quarter of 2018, compared to one longwall move in the prior year period.  Additionally, cost of coal produced (excluding depreciation, depletion and amortization) for the third quarter of 2017 included $4.3 million arising from the non-cash adjustment of inventory to fair value related to the application of pushdown accounting.      

 

 

1

 

 


 

 

Transportation costs increased approximately $21.8 million from the third quarter 2017 to the third quarter 2018 due to a higher percentage of sales going to the export market during the current year period and the additional transportation and transloading costs associated therewith.      

 

Other operating (income) expense, net for the third quarter 2018 includes $25.0 million in charges related to the settlement of litigation with NRP related to matters arising from the combustion event at Hillsboro Energy and royalty matters at Macoupin Energy.  While the matters with NRP are settled, Foresight remains in discussions with its insurance providers regarding further potential recoveries under its policies related to the Hillsboro Energy combustion event; however, there can be no assurances that Foresight will receive any further insurance recoveries related to the Hillsboro combustion event.    

 

During the third quarter 2018, Foresight generated operating cash flows of $51.3 million and ended the period with $43.1 million in cash and $129.7 million of available borrowing capacity, net of outstanding borrowings and letters of credit, under its revolving credit facility.  Capital expenditures for the quarter ended September 30, 2018 totaled $18.6 million compared to $15.2 million for the quarter ended September 30, 2017.  

 

Guidance for 2018

 

Based on Foresight’s remaining contracted position, third quarter and year-to-date performance, and its current outlook on pricing and the coal markets in general, the Partnership is affirming and updating 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 22.4 and 23.0 million tons, with approximately 9.0 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 $305 to $325 million.

 

Capital Expenditures – Total 2018 capital expenditures are estimated to be between $70 and $77 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 72018.  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. Adjusted EBITDA also includes any insurance recoveries received, regardless of whether they relate to the recovery of mitigation costs, the receipt of business interruption proceeds, or the recovery of losses on machinery and equipment.  

 

2

 

 


 

 

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 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, 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 1.7 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.  Foresight also owns coal interests and mining assets located in southeastern Ohio.

 

 

Contact

 

Cody E. Nett

Corporate Secretary and Director of Media and Investor 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”).     

 

3

 

 


 

 

Foresight Energy LP

Unaudited Condensed Consolidated Balance Sheets

(In Thousands)

 

(Successor)

 

 

 

(Successor)

 

 

September 30,

 

 

 

December 31,

 

 

2018

 

 

 

2017

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

43,070

 

 

 

$

2,179

 

Accounts receivable

 

38,583

 

 

 

 

35,158

 

Due from affiliates

 

32,055

 

 

 

 

37,685

 

Financing receivables - affiliate

 

3,327

 

 

 

 

3,138

 

Inventories, net

 

52,924

 

 

 

 

40,539

 

Prepaid royalties

 

 

 

 

 

4,000

 

Deferred longwall costs

 

14,172

 

 

 

 

9,520

 

Other prepaid expenses and current assets

 

8,139

 

 

 

 

10,844

 

Contract-based intangibles

 

1,430

 

 

 

 

11,268

 

Total current assets

 

193,700

 

 

 

 

154,331

 

Property, plant, equipment and development, net

 

2,168,348

 

 

 

 

2,378,605

 

Due from affiliates

 

 

 

 

 

947

 

Financing receivables - affiliate

 

61,514

 

 

 

 

64,097

 

Prepaid royalties, net

 

2,295

 

 

 

 

1,250

 

Other assets

 

4,640

 

 

 

 

5,358

 

Contract-based intangibles

 

1,058

 

 

 

 

2,052

 

Total assets

$

2,431,555

 

 

 

$

2,606,640

 

Liabilities and partners’ capital

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Current portion of long-term debt and capital lease obligations

$

41,498

 

 

 

$

109,532

 

Current portion of sale-leaseback financing arrangements

 

5,851

 

 

 

 

4,148

 

Accrued interest

 

26,342

 

 

 

 

13,410

 

Accounts payable

 

96,284

 

 

 

 

76,658

 

Accrued expenses and other current liabilities

 

80,662

 

 

 

 

62,442

 

Asset retirement obligations

 

4,416

 

 

 

 

4,416

 

Due to affiliates

 

23,384

 

 

 

 

13,324

 

Contract-based intangibles

 

16,844

 

 

 

 

28,688

 

Total current liabilities

 

295,281

 

 

 

 

312,618

 

Long-term debt and capital lease obligations

 

1,209,172

 

 

 

 

1,205,000

 

Sale-leaseback financing arrangements

 

192,298

 

 

 

 

196,496

 

Asset retirement obligations

 

51,686

 

 

 

 

39,655

 

Other long-term liabilities

 

29,857

 

 

 

 

32,330

 

Contract-based intangibles

 

69,027

 

 

 

 

144,715

 

Total liabilities

 

1,847,321

 

 

 

 

1,930,814

 

Limited partners' capital:

 

 

 

 

 

 

 

 

Common unitholders (80,844 and 77,644 units outstanding as of September 30, 2018 and December 31, 2017, respectively)

 

370,884

 

 

 

 

421,161

 

Subordinated unitholder (64,955 units outstanding as of September 30, 2018 and December 31, 2017)

 

213,350

 

 

 

 

254,665

 

Total partners' capital

 

584,234

 

 

 

 

675,826

 

Total liabilities and partners' capital

$

2,431,555

 

 

 

$

2,606,640

 


 

4

 

 


 

 

Foresight Energy LP

Unaudited Condensed Consolidated Statements of Operations

(In Thousands, Except Per Unit Data)

 

(Successor)

 

 

(Successor)

 

 

 

(Successor)

 

 

(Successor)

 

 

(Predecessor)

 

 

Three Months Ended

September 30, 2018

 

 

Three Months Ended

September 30, 2017

 

 

 

Nine Months Ended

September 30, 2018

 

 

Period From

April 1, 2017 through

September 30, 2017

 

 

Period From

January 1, 2017

through

March 31, 2017

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Coal sales

$

291,987

 

 

$

229,670

 

 

 

$

800,366

 

 

$

434,186

 

 

$

227,813

 

Other revenues

 

1,949

 

 

 

2,770

 

 

 

 

5,718

 

 

 

5,347

 

 

 

2,581

 

Total revenues

 

293,936

 

 

 

232,440

 

 

 

 

806,084

 

 

 

439,533

 

 

 

230,394

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

133,670

 

 

 

122,839

 

 

 

 

391,222

 

 

 

228,629

 

 

 

117,762

 

Cost of coal purchased

 

6,312

 

 

 

 

 

 

 

11,969

 

 

 

 

 

 

7,973

 

Transportation

 

61,239

 

 

 

39,414

 

 

 

 

166,716

 

 

 

67,672

 

 

 

37,726

 

Depreciation, depletion and amortization

 

52,780

 

 

 

53,754

 

 

 

 

159,512

 

 

 

103,291

 

 

 

39,298

 

Contract amortization and write-off

 

(4,855

)

 

 

(15,611

)

 

 

 

(76,699

)

 

 

(6,878

)

 

 

 

Accretion on asset retirement obligations

 

558

 

 

 

726

 

 

 

 

1,848

 

 

 

1,454

 

 

 

710

 

Selling, general and administrative

 

10,465

 

 

 

7,858

 

 

 

 

28,774

 

 

 

15,135

 

 

 

6,554

 

Long-lived asset impairments

 

 

 

 

 

 

 

 

110,689

 

 

 

 

 

 

 

Loss on commodity derivative contracts

 

 

 

 

1,101

 

 

 

 

 

 

 

2,218

 

 

 

1,492

 

Other operating (income) expense, net

 

24,849

 

 

 

(48

)

 

 

 

(18,782

)

 

 

(13,538

)

 

 

451

 

Operating income

 

8,918

 

 

 

22,407

 

 

 

 

30,835

 

 

 

41,550

 

 

 

18,428

 

Other expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

36,619

 

 

 

35,988

 

 

 

 

109,327

 

 

 

71,408

 

 

 

43,380

 

Change in fair value of warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(9,278

)

Loss on early extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

 

 

 

95,510

 

Net loss

$

(27,701

)

 

$

(13,581

)

 

 

$

(78,492

)

 

$

(29,858

)

 

$

(111,184

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common unitholders

$

(13,298

)

 

$

(5,097

)

 

 

$

(37,177

)

 

$

(13,887

)

 

$

(56,259

)

Subordinated unitholder

$

(14,403

)

 

$

(8,484

)

 

 

$

(41,315

)

 

$

(15,971

)

 

$

(54,925

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per limited partner unit - basic and diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common unitholders

$

(0.17

)

 

$

(0.07

)

 

 

$

(0.47

)

 

$

(0.18

)

 

$

(0.85

)

Subordinated unitholder

$

(0.22

)

 

$

(0.13

)

 

 

$

(0.64

)

 

$

(0.25

)

 

$

(0.85

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average limited partner units outstanding - basic and diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common units

 

80,505

 

 

 

77,510

 

 

 

 

79,737

 

 

 

76,893

 

 

 

66,533

 

Subordinated units

 

64,955

 

 

 

64,955

 

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Distributions declared per limited partner unit

$

0.0565

 

 

$

0.0647

 

 

 

$

0.1695

 

 

$

0.0647

 

 

$

 


 

5

 

 


 

 

Foresight Energy LP

Unaudited Condensed Consolidated Statements of Cash Flows

(In Thousands)

 

(Successor)

 

 

(Successor)

 

 

(Predecessor)

 

 

Nine Months Ended

September 30, 2018

 

 

Period From

April 1, 2017

through

September 30, 2017

 

 

Period From

January 1, 2017

through

March 31, 2017

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(78,492

)

 

$

(29,858

)

 

$

(111,184

)

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

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

159,512

 

 

 

103,291

 

 

 

39,298

 

Amortization of debt discount and deferred issuance costs

 

2,015

 

 

 

1,273

 

 

 

6,365

 

Contract amortization and write-off

 

(76,699

)

 

 

(6,878

)

 

 

 

Equity-based compensation

 

530

 

 

 

439

 

 

 

318

 

Loss on commodity derivative contracts

 

 

 

 

2,218

 

 

 

1,492

 

Settlements of commodity derivative contracts

 

 

 

 

320

 

 

 

3,724

 

Realized gains on coal derivatives included in investing activities

 

 

 

 

 

 

 

(3,520

)

Long-lived asset impairments

 

110,689

 

 

 

 

 

 

 

Insurance proceeds included in investing activities

 

(42,947

)

 

 

 

 

 

 

Change in fair value of warrants

 

 

 

 

 

 

 

(9,278

)

Debt extinguishment expense

 

 

 

 

 

 

 

95,510

 

Other

 

 

 

 

8,915

 

 

 

1,321

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

(3,425

)

 

 

9,450

 

 

 

19,695

 

Due from/to affiliates, net

 

16,637

 

 

 

6,923

 

 

 

(13,157

)

Inventories

 

(10,307

)

 

 

(22,159

)

 

 

(917

)

Prepaid expenses and other assets

 

(244

)

 

 

(4,759

)

 

 

(5,117

)

Prepaid royalties

 

2,955

 

 

 

6,240

 

 

 

(241

)

Commodity derivative assets and liabilities

 

 

 

 

266

 

 

 

(532

)

Accounts payable

 

19,626

 

 

 

(582

)

 

 

7,324

 

Accrued interest

 

12,932

 

 

 

22,493

 

 

 

(9,803

)

Accrued expenses and other current liabilities

 

18,667

 

 

 

1,188

 

 

 

(3,430

)

Other

 

2,155

 

 

 

1,300

 

 

 

1,782

 

Net cash provided by operating activities

 

133,604

 

 

 

100,080

 

 

 

19,650

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

Investment in property, plant, equipment and development

 

(50,872

)

 

 

(36,960

)

 

 

(19,908

)

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

 

2,394

 

 

 

1,452

 

 

 

705

 

Insurance proceeds

 

42,947

 

 

 

 

 

 

 

Settlement of certain coal derivatives

 

 

 

 

 

 

 

3,520

 

Proceeds from sale of property, plant and equipment

 

 

 

 

 

 

 

1,898

 

Net cash used in investing activities

 

(5,531

)

 

 

(35,508

)

 

 

(13,785

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

Borrowings under revolving credit facility

 

50,000

 

 

 

 

 

 

 

Payments on revolving credit facility

 

(22,000

)

 

 

 

 

 

(352,500

)

Net change in borrowings under A/R securitization program

 

 

 

 

(10,300

)

 

 

7,000

 

Proceeds from long-term debt and capital lease obligations

 

 

 

 

 

 

 

1,234,438

 

Payments on long-term debt and capital lease obligations

 

(93,877

)

 

 

(23,539

)

 

 

(970,721

)

Payments on short-term debt

 

(5,180

)

 

 

 

 

 

 

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

 

 

 

 

 

 

 

60,586

 

Distributions paid

 

(13,574

)

 

 

(5,026

)

 

 

 

Debt extinguishment costs

 

 

 

 

 

 

 

(57,645

)

Debt issuance costs paid

 

 

 

 

 

 

 

(27,328

)

Other

 

(2,551

)

 

 

(3,471

)

 

 

(1,892

)

Net cash used in financing activities

 

(87,182

)

 

 

(42,336

)

 

 

(108,062

)

Net increase (decrease) in cash, cash equivalents, and restricted cash

 

40,891

 

 

 

22,236

 

 

 

(102,197

)

Cash, cash equivalents, and restricted cash, beginning of period

 

2,179

 

 

 

14,724

 

 

 

116,921

 

Cash, cash equivalents, and restricted cash, end of period

$

43,070

 

 

$

36,960

 

 

$

14,724

 


 

6

 

 


 

 

Reconciliation of U.S. GAAP Net Loss to Adjusted EBITDA (In Thousands)

 

(Successor)

Three Months Ended

September 30, 2018

 

 

(Successor)

Three Months Ended

September 30, 2017

 

 

(Successor)

Nine Months Ended

September 30, 2018

 

 

(Successor)

Period From

April 1, 2017

through

September 30, 2017

 

 

(Predecessor)

Period From

January 1, 2017

through

March 31, 2017

 

 

Combined - Period From

January 1, 2017

through

September 30, 2017

 

Net loss(1)(2)

$

(27,701

)

 

$

(13,581

)

 

$

(78,492

)

 

$

(29,858

)

 

$

(111,184

)

 

$

(141,042

)

Interest expense, net

 

36,619

 

 

 

35,988

 

 

 

109,327

 

 

 

71,408

 

 

 

43,380

 

 

 

114,788

 

Depreciation, depletion and amortization

 

52,780

 

 

 

53,754

 

 

 

159,512

 

 

 

103,291

 

 

 

39,298

 

 

 

142,589

 

Accretion on asset retirement obligations

 

558

 

 

 

726

 

 

 

1,848

 

 

 

1,454

 

 

 

710

 

 

 

2,164

 

Contract amortization and write-off

 

(4,855

)

 

 

(15,611

)

 

 

(76,699

)

 

 

(6,878

)

 

 

 

 

 

(6,878

)

Noncash impact of recording coal inventory to fair value in pushdown accounting

 

 

 

 

 

4,306

 

 

 

 

 

 

8,868

 

 

 

 

 

 

8,868

 

Equity-based compensation

 

178

 

 

 

228

 

 

 

530

 

 

 

439

 

 

 

318

 

 

 

757

 

Long-lived asset impairments

 

 

 

 

 

 

 

110,689

 

 

 

 

 

 

 

 

 

 

Loss on commodity derivative contracts

 

 

 

 

1,101

 

 

 

 

 

 

2,218

 

 

 

1,492

 

 

 

3,710

 

Settlements of commodity derivative contracts

 

 

 

 

(124

)

 

 

 

 

 

320

 

 

 

3,724

 

 

 

4,044

 

Change in fair value of warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

(9,278

)

 

 

(9,278

)

Loss on early extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

 

 

95,510

 

 

 

95,510

 

Adjusted EBITDA

$

57,579

 

 

$

66,787

 

 

$

226,715

 

 

$

151,262

 

 

$

63,970

 

 

$

215,232

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) - Included in net loss during the three and nine months ended September 30, 2018 was expense of $25.0 million related to the settlement of litigation related to the Hillsboro and Macoupin matters.

(2) - Included in net loss during the nine months ended September 30, 2018 and the three months and combined period ended September 30, 2017 was insurance proceeds of $44.1 million, $1.5 million, and $12.8 million, respectively, from the Hillsboro mine combustion event.

 

 

Operating Metrics (In Thousands, Except Per Ton Data)

 

 

 

 

(Successor)

Three Months Ended

September 30, 2018

 

 

(Successor)

Three Months Ended

September 30, 2017

 

 

(Successor)

Nine Months Ended

September 30, 2018

 

 

(Successor)

Period From

April 1, 2017

through

September 30, 2017

 

 

(Predecessor)

Period From

January 1, 2017

through

March 31, 2017

 

 

Combined - Period From

January 1, 2017

through

September 30, 2017

 

 

Produced tons sold

 

6,000

 

 

 

5,242

 

 

 

16,978

 

 

 

10,077

 

 

 

5,165

 

 

 

15,242

 

 

Purchased tons sold

 

143

 

 

 

 

 

 

272

 

 

 

 

 

 

118

 

 

 

118

 

 

Total tons sold

 

6,143