The coal sector caught fire today, helped in part by strong first-quarter earnings from Patriot Coal (PCX). The company reported profits of $0.41 per share - $0.95 better than consensus expectations of a $0.54-per-share loss. Revenues jumped 86% year-over-year to $528.9 million, whereas analysts were expecting slightly better revenues of $539 million.
According to Briefing.com, on the conference call Patriot admitted the coal market was very depressed. It expects a slow recovery beginning at the end of 2009, led by electricity and the steel market. Executives also pointed to the Obama administration's so-called "right" balance of low-cost energy, which will ultimately require more coal. It expects to sell between 34 and 36 million tons in 2009.
You'd wonder why no major news reports say that the company beats the estimate.
BRIEF: Patriot Coal turns profit on accounting adjustment [St. Louis Post-Dispatch] 2:57 p.m. 04/30/2009 By Jeffrey Tomich, St. Louis Post-Dispatch Provided By Knight Ridder/Tribune Apr. 30--Patriot Coal Corp. (PCX) reported a $32.1 million first-quarter profit compared with a loss in the same period a year ago because of an accounting adjustment related to last year's purchase of Magnum Coal Co. On a per-share basis, net income was 41 cents compared with a net loss of $3.1 million, or 6 cents a share, in the first quarter of 2008, Creve Coeur-based Patriot said today in a statement. The most recent quarter's results include a $77 million reduction in expenses related to adjustments for below-market contracts acquired in the Magnum Coal deal. Excluding those, Patriot lost 57 cents a share, according to Dahlman Rose & Co. analyst Daniel Scott. Analysts surveyed by Thomson Reuters expected a 54-cent loss.
So AP and Reuters are not major news sources? They sure like the .41 profit..Their lead story centers on .41 profit for PCX..I'm not sure what your angle is but time to go long on coal..Major momentum on thursday in the coal sector..