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Section 1: 8-K (8-K)

felp-8k_20190227.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): February 27, 2019

 

 

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 February 27, 2019, Foresight Energy LP (the “Partnership”) announced via press release its earnings and operating results for the fourth quarter and full year 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 February 27, 2019.

 

 

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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

 

 

Chairman of the Board, President and

Chief Executive Officer

 

 

Date: February 27, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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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 2018 Results

 

Full-Year 2018 Highlights:

 

Coal sales of $1.097 billion on record sales volumes of 23.4 million tons.

Adjusted EBITDA of $313.6 million.

Cash flows from operations of $133.4 million.

Net loss of $61.6 million, or ($0.32) per common unit and ($0.55) per subordinated unit.  

Paid cash distributions to common unitholders totaling $18.1 million, or $0.2260 per unit, during 2018

Increased the distribution by 6% to $0.06 per unit from retained excess cash flow, to be paid on March 29, 2019 to unitholders of record as of March 19, 2019.  

Excess Cash Flow Sweep of $19.6 million to be applied to first lien debt in 2019.

 

ST.  LOUIS, Missouri (BUSINESS WIRE) February 27, 2019 — Foresight Energy LP (“Foresight” or the “Partnership”) (NYSE: FELP) today reported financial and operating results for the fourth quarter and year ended December 31, 2018.  Foresight generated fiscal year coal sales revenues of $1.097 billion on sales volumes of 23.4 million tons resulting in a net loss of $61.6 million, Adjusted EBITDA of $313.6 million and cash flows from operations of $133.4 million.  Net loss reflects the receipt of $44.1 million of insurance proceeds, a $110.7 million non-cash impairment charge, and a $69.1 million non-cash contract benefit all related to the Hillsboro combustion event.  Also included in net loss is a $25 million charge related to the settlement of litigation with Natural Resource Partners L.P. (“NRP”) related to matters at Hillsboro Energy and Macoupin Energy.    

 

“Foresight’s financial and operating results for 2018 demonstrated our ability to capitalize on strong export markets and improved domestic spot opportunities to achieve record sales volumes,” remarked Mr. Robert D. Moore, Chairman, President, and Chief Executive Officer.  “These volumes helped drive a 16% increase in sales revenues compared to the prior year, Adjusted EBITDA of over $313 million, and cash flows from operations exceeding $133 million, all while safely producing 23.3 million tons, maintaining our industry-leading cost structure, and capturing solid margins.”  

 

Mr. Moore further commented, “In 2018 we, again, achieved excellent operating results and positioned the Partnership for future growth.  Further, with the resolution of the litigation with NRP involving our Hillsboro complex, we were able to resume production at our Deer Run Mine with one continuous miner unit.  We continue to evaluate our potential future mining options at the Deer Run Mine, which has the potential to be our lowest cost asset.”

 

Foresight announced that, due to the Partnership’s operating performance during the fourth quarter, the Board of Directors of its General Partner approved an increase of 6% in the quarterly cash distribution to $0.06 per unit from retained excess cash flow.  The distribution is payable on March 29, 2019 for unitholders of record on March 19, 2019.  In addition, an excess cash flow sweep payment of $19.6 million will be applied to the Partnership’s first lien debt in 2019.

 

Consolidated Financial Results

 

Year Ended December 31, 2018 Compared to Year Ended December 31, 2017

 

Coal sales totaled $1,097.4 million for 2018 compared to $944.4 million for 2017, representing an increase of $152.9 million, or 16%.  The increase in coal sales revenues was driven by a nearly 10%, or 2.0 million, increase in tons sold combined with an increase in coal sales realizations of over 6%, or $2.71 per ton sold.  The increases in sales volumes and sales realizations per ton were primarily the result of increased export sales, which experienced favorable API2 pricing during 2018, as well as more favorable domestic spot market pricing and improved demand.  

 

 

1

 

 


 

 

Cost of coal produced was $527.0 million for 2018 compared to $485.6 million for 2017.  The increase in cost of coal produced was due to higher sales volumes during the 2018 year compared to the 2017 year, as the cost per ton sold remained consistent year-over-year at $22.85 per ton sold.     

 

Transportation costs increased $66.5 million from 2017 to 2018 because of higher sales volumes and a higher percentage of our sales going to the export market during the current year and the additional transportation and transloading costs associated therewith.      

 

Selling, general and administrative expense increased $9.5 million from $30.1 million in 2017 to $39.6 million in 2018.  The increase is primarily due to contractual increases in the management services agreement between Foresight and Murray Energy Corporation (“Murray Energy”), increased sales and marketing expense associated with our increased export sales volumes, and legal expenses associated with the settlement of the Hillsboro and Macoupin matters.  

 

During 2018, Foresight recognized an aggregate impairment charge of $110.7 million related to certain long-lived assets and mineral reserves associated with our Hillsboro complex.  During 2017, Foresight recorded impairment charges of $42.7 million associated with certain longwall equipment and other related assets that were permanently sealed within and were not recovered from our Hillsboro Deer Run Mine.

 

Other operating (income) expense, net increased $6.0 million for the year ended December 31, 2018 as compared to the prior year primarily due to the receipt of $43.0 million in payments from insurance companies offset by $25.0 million for the settlement of litigation related to the Hillsboro and Macoupin matters.  This compares to $12.8 million in payments from insurance companies in the prior year.    

 

Interest expense during 2018 decreased $5.1 million compared to interest expense during fiscal year 2017 primarily due to lower effective interest rates on our existing debt compared to the interest rates on the indebtedness retired in the March 2017 refinancing transaction and overall lower debt balances as the Partnership continues to pay down debt.  The decrease was slightly offset by increased interest expense on revolving credit facility borrowings outstanding and overall higher variable interest rates during 2018.    

 

During 2018, Foresight generated operating cash flows of $133.4 million and ended the year with $0.3 million in cash and $120.7 million of available borrowing capacity, net of outstanding borrowings and letters of credit, under its revolving credit facility.  Capital expenditures for the year ended December 31, 2018 totaled $84.1 million compared $76.5 million for the year ended December 31, 2017.  The increase in capital expenditures was primarily the result of the timing of infrastructure improvements at our Sugar Camp rail loadout, plus the addition of mining equipment that could allow for the reduction in longwall move outages at our longwall operations.

 

Three Months Ended December 31, 2018 Compared to Three Months Ended December 31, 2017

 

Coal sales were $297.0 million for the three months ended December 31, 2018 compared to $282.4 million for the prior year period.  This change was driven by a slight increase in total tons sold, combined with a $1.32 per ton increase in sales realizations per ton.  The increase in coal sales realizations per ton was principally driven by favorable API2 pricing on export sales, as well as more favorable domestic spot market pricing.  

 

Cost of coal produced for the three months ended December 31, 2018 was $135.8 million compared to $139.2 million for the three months ended December 31, 2017.  The decrease in cost of coal produced resulted from a slightly lower cash cost per ton sold as Foresight’s industry-leading productivity continued to translate into low operating costs.    

 

Guidance for 2019

 

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 2019:

 

Sales Volumes – Based on current committed position and expectations for 2019, Foresight is projecting sales volumes to be between 22.0 and 23.0 million tons, with over 7.0 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 $300 to $340 million.

 

Capital Expenditures – Total 2019 capital expenditures are estimated to be between $80 and $95 million.  

 


 

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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 February 27, 2019.  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) 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, contract amortization and write-off, 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.

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) income, 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, 2019. A reconciliation of estimated 2019 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.

 


 

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About Foresight Energy LP

 

Foresight is a leading producer and marketer of thermal coal controlling nearly 2.1 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. Additionally, Foresight has recently resumed continuous miner production at its Hillsboro complex and continues to evaluate potential future mining options. 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

 

Cody E. Nett

Corporate Secretary

740-338-3100

[email protected]

[email protected]

 

 

 

 

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.    

 

4

 

 


 

 

Foresight Energy LP

Consolidated Balance Sheets

(In Thousands)

 

(Successor)

 

 

 

(Successor)

 

 

December 31,

 

 

 

December 31,

 

 

2018

 

 

 

2017

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

269

 

 

 

$

2,179

 

Accounts receivable

 

32,248

 

 

 

 

35,158

 

Due from affiliates

 

49,613

 

 

 

 

37,685

 

Financing receivables - affiliate

 

3,392

 

 

 

 

3,138

 

Inventories, net

 

56,524

 

 

 

 

40,539

 

Prepaid royalties

 

2,000

 

 

 

 

4,000

 

Deferred longwall costs

 

14,940

 

 

 

 

9,520

 

Other prepaid expenses and current assets

 

10,872

 

 

 

 

10,844

 

Contract-based intangibles

 

1,326

 

 

 

 

11,268

 

Total current assets

 

171,184

 

 

 

 

154,331

 

Property, plant, equipment, and development, net

 

2,148,569

 

 

 

 

2,378,605

 

Due from affiliates

 

 

 

 

 

947

 

Financing receivables - affiliate

 

60,705

 

 

 

 

64,097

 

Prepaid royalties

 

2,678

 

 

 

 

1,250

 

Other assets

 

4,311

 

 

 

 

5,358

 

Contract-based intangibles

 

726

 

 

 

 

2,052

 

Total assets

$

2,388,173

 

 

 

$

2,606,640

 

Liabilities and partners’ capital

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Current portion of long-term debt and capital lease obligations

$

53,709

 

 

 

$

109,532

 

Current portion of sale-leaseback financing arrangements

 

6,629

 

 

 

 

4,148

 

Accrued interest

 

24,304

 

 

 

 

13,410

 

Accounts payable

 

99,735

 

 

 

 

76,658

 

Accrued expenses and other current liabilities

 

67,466

 

 

 

 

62,442

 

Asset retirement obligations

 

6,578

 

 

 

 

4,416

 

Due to affiliates

 

17,740

 

 

 

 

13,324

 

Contract-based intangibles

 

8,820

 

 

 

 

28,688

 

Total current liabilities

 

284,981

 

 

 

 

312,618

 

Long-term debt and capital lease obligations

 

1,194,394

 

 

 

 

1,205,000

 

Sale-leaseback financing arrangements

 

189,855

 

 

 

 

196,496

 

Asset retirement obligations

 

38,966

 

 

 

 

39,655

 

Other long-term liabilities

 

16,428

 

 

 

 

32,330

 

Contract-based intangibles

 

66,834

 

 

 

 

144,715

 

Total liabilities

 

1,791,458

 

 

 

 

1,930,814

 

Limited partners' capital:

 

 

 

 

 

 

 

 

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

 

377,880

 

 

 

 

421,161

 

Subordinated unitholders (64,955 units outstanding as of December 31, 2018 and 2017)

 

218,835

 

 

 

 

254,665

 

Total limited partners' capital

 

596,715

 

 

 

 

675,826

 

Total liabilities and partners' capital

$

2,388,173

 

 

 

$

2,606,640

 

 

 

 

 

 

 

 

 

 


 

5

 

 


 

 

Foresight Energy LP

Consolidated Statement of Operations

(In Thousands, Except Per Unit Data)

 

(Unaudited)

 

 

(Unaudited)

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

(Successor)

 

 

(Successor)

 

 

(Successor)

 

 

(Successor)

 

 

(Successor)

 

 

(Predecessor)

 

 

Combined -

 

 

Three Months Ended December 31, 2018

 

 

Three Months Ended December 31, 2017

 

 

Three Months Ended September 30, 2018

 

 

Year Ended

December 31, 2018

 

 

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

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Coal sales

$

297,000

 

 

$

282,431

 

 

$

291,987

 

 

$

1,097,366

 

 

$

716,617

 

 

$

227,813

 

 

$

944,430

 

Other revenues

 

1,907

 

 

 

2,180

 

 

 

1,949

 

 

 

7,625

 

 

 

7,527

 

 

 

2,581

 

 

 

10,108

 

Total revenues

 

298,907

 

 

 

284,611

 

 

 

293,936

 

 

 

1,104,991

 

 

 

724,144

 

 

 

230,394

 

 

 

954,538

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

135,762

 

 

 

139,215

 

 

 

133,670

 

 

 

526,984

 

 

 

367,844

 

 

 

117,762

 

 

 

485,606

 

Cost of coal purchased

 

2,603

 

 

 

 

 

 

6,312

 

 

 

14,572

 

 

 

 

 

 

7,973

 

 

 

7,973

 

Transportation

 

63,336

 

 

 

58,100

 

 

 

61,239

 

 

 

230,052

 

 

 

125,772

 

 

 

37,726

 

 

 

163,498

 

Depreciation, depletion and amortization

 

53,128

 

 

 

64,503

 

 

 

52,780

 

 

 

212,640

 

 

 

167,794

 

 

 

39,298

 

 

 

207,092

 

Contract amortization and write-off

 

(9,782

)

 

 

8,286

 

 

 

(4,855

)

 

 

(86,481

)

 

 

1,408

 

 

 

 

 

 

1,408

 

Accretion and changes in estimates on asset retirement obligations

 

(10,364

)

 

 

725

 

 

 

558

 

 

 

(8,516

)

 

 

2,179

 

 

 

710

 

 

 

2,889

 

Selling, general and administrative

 

10,794

 

 

 

8,420

 

 

 

10,465

 

 

 

39,568

 

 

 

23,555

 

 

 

6,554

 

 

 

30,109

 

Long-lived asset impairments

 

 

 

 

42,667

 

 

 

 

 

 

110,689

 

 

 

42,667

 

 

 

 

 

 

42,667

 

Loss on commodity derivative contracts

 

 

 

 

389

 

 

 

 

 

 

 

 

 

2,607

 

 

 

1,492

 

 

 

4,099

 

Other operating (income) expense, net

 

(258

)

 

 

1

 

 

 

24,849

 

 

 

(19,040

)

 

 

(13,537

)

 

 

451

 

 

 

(13,086

)

Operating income (loss)

 

53,688

 

 

 

(37,695

)

 

 

8,918

 

 

 

84,523

 

 

 

3,855

 

 

 

18,428

 

 

 

22,283

 

Other expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

36,809

 

 

 

36,496

 

 

 

36,619

 

 

 

146,136

 

 

 

107,904

 

 

 

43,380

 

 

 

151,284

 

Change in fair value of warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(9,278

)

 

 

(9,278

)

Loss on early extinguishment of debt

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

95,510

 

 

 

95,510

 

Net income (loss)

$

16,879

 

 

$

(74,191

)

 

$

(27,701

)

 

$

(61,613

)

 

$

(104,049

)

 

$

(111,184

)

 

$

(215,233

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common unitholders

$

11,394

 

 

$

(38,256

)

 

$

(13,298

)

 

$

(25,783

)

 

$

(52,143

)

 

$

(56,259

)

 

$

(108,402

)

Subordinated unitholders

$

5,485

 

 

$

(35,935

)

 

$

(14,403

)

 

$

(35,830

)

 

$

(51,906

)

 

$

(54,925

)

 

$

(106,831

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per limited partner unit - basic:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common unitholders

$

0.14

 

 

$

(0.49

)

 

$

(0.17

)

 

$

(0.32

)

 

$

(0.68

)

 

$

(0.85

)

 

n/a

 

Subordinated unitholders

$

0.08

 

 

$

(0.55

)

 

$

(0.22

)

 

$

(0.55

)

 

$

(0.80

)

 

$

(0.85

)

 

n/a

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per limited partner unit - diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common unitholders

$

0.14

 

 

$

(0.49

)

 

$

(0.17

)

 

$

(0.32

)

 

$

(0.68

)

 

$

(0.85

)

 

n/a

 

Subordinated unitholders

$

0.08

 

 

$

(0.55

)

 

$

(0.22

)

 

$

(0.55

)

 

$

(0.80

)

 

$

(0.85

)

 

n/a

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average limited partner units outstanding - basic:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common units

 

80,844

 

 

 

77,644

 

 

 

80,505

 

 

 

80,016

 

 

 

77,145

 

 

 

66,533

 

 

n/a

 

Subordinated units

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

n/a

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average limited partner units outstanding - diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common units

 

81,650

 

 

 

77,644

 

 

 

80,505

 

 

 

80,016

 

 

 

77,145

 

 

 

66,533

 

 

n/a

 

Subordinated units

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

 

64,955

 

 

n/a

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Distributions declared per limited partner unit

$

0.0565

 

 

$

0.0605

 

 

$

0.0565

 

 

$

0.2260

 

 

$

0.1252

 

 

$

 

 

$

0.1252

 


 

6

 

 


 

 

Foresight Energy LP

Consolidated Statements of Cash Flows

(In Thousands)

 

(Successor)

 

 

(Successor)

 

 

(Predecessor)

 

 

Year Ended December 31, 2018

 

 

Period from April 1, 2017 through December 31, 2017

 

 

Period From January 1, 2017 through March 31, 2017

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

Net loss

$

(61,613

)

 

$

(104,049

)

 

$

(111,184

)

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

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

212,640

 

 

 

167,794

 

 

 

39,298

 

Amortization of debt issuance costs and debt discount

 

2,716

 

 

 

1,927

 

 

 

6,365

 

Contract amortization and write-off

 

(86,481

)

 

 

1,408

 

 

 

 

Accretion and changes in estimates on asset retirement obligations

 

(8,516

)

 

 

2,179

 

 

 

710

 

Equity-based compensation

 

729

 

 

 

575

 

 

 

318

 

Settlements and losses on commodity derivative contracts

 

 

 

 

2,435

 

 

 

5,216

 

Realized gains on commodity derivative contracts included in investing activities

 

 

 

 

 

 

 

(3,520

)

Insurance proceeds included in investing activities

 

(42,947

)

 

 

 

 

 

 

Change in fair value of warrants

 

 

 

 

 

 

 

(9,278

)

Long-lived asset impairments

 

110,689

 

 

 

42,667

 

 

 

 

Transition and reorganization expenses paid by Foresight Reserves (affiliate)

 

 

 

 

 

 

 

 

Current period interest expense converted into debt

 

 

 

 

 

 

 

 

Non-cash debt extinguishment expense

 

 

 

 

 

 

 

95,510

 

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

 

 

 

 

8,868

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

2,910

 

 

 

52

 

 

 

19,695

 

Due from/to affiliates, net

 

(6,565

)

 

 

(14,321

)

 

 

(13,157

)

Inventories

 

(13,712

)

 

 

4,788

 

 

 

(917

)

Prepaid expenses and other assets

 

974

 

 

 

(10,535

)

 

 

(5,117

)

Prepaid royalties

 

572

 

 

 

1,368

 

 

 

(241

)

Commodity derivative assets and liabilities

 

 

 

 

633

 

 

 

(532

)

Accounts payable

 

23,077

 

 

 

8,363

 

 

 

7,324

 

Accrued interest

 

10,894

 

 

 

8,961

 

 

 

(9,803

)

Accrued expenses and other current liabilities

 

(12,276

)

 

 

(11,574

)

 

 

(3,430

)

Other

 

276

 

 

 

29

 

 

 

2,393

 

Net cash provided by operating activities

 

133,367

 

 

 

111,568

 

 

 

19,650

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

Investment in property, plant, equipment and development

 

(84,147

)

 

 

(56,547

)

 

 

(19,908

)

Realized gains on commodity derivative contracts

 

 

 

 

 

 

 

3,520

 

Insurance proceeds included in investing activities

 

42,947

 

 

 

 

 

 

 

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

 

3,138

 

 

 

2,199

 

 

 

705

 

Proceeds from sale of equipment and other

 

 

 

 

 

 

 

1,898

 

Net cash used in investing activities

 

(38,062

)

 

 

(54,348

)

 

 

(13,785

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

Borrowings under revolving credit facility

 

61,000

 

 

 

 

 

 

 

Payments on revolving credit facility

 

(24,000

)

 

 

 

 

 

(352,500

)

Net change in borrowings under A/R securitization program

 

 

 

 

(21,200

)

 

 

7,000

 

Proceeds from long-term debt and capital lease obligations

 

 

 

 

 

 

 

1,234,438

 

Payments on long-term debt and capital lease obligations

 

(106,146

)

 

 

(33,971

)

 

 

(970,721

)

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

 

 

 

 

 

 

 

60,586

 

Distributions paid

 

(18,142

)

 

 

(9,725

)

 

 

 

Debt extinguishment costs

 

 

 

 

 

 

 

(57,645

)

Debt issuance costs paid

 

 

 

 

 

 

 

(27,328

)

Payments on sale-leaseback and short-term financing arrangements

 

(9,927

)

 

 

(4,869

)

 

 

(1,892

)

Net cash used in fi