I don't know but part of that article says not much growth if any in India. And, it explains why BTU sold one mine for only $20 million and assumption of debt and another mine in Australia they cut production by 50%. I bet this coming earnings will be worse than people think. But going forward is worse.
Litigation against BTU
On another front, like vultures circling a carcass, the litigators are lining up to attack BTU. In one action BTU is being sued for possible violation of the Employee Retirement Income Security Act for offering employees BTU shares as a sound investment option. In another there is an action concerning the self-bonding issue. In a third action the Coal Pension Plan is suing BTU and Arch Coal (NYSE:ACI).
While some of this litigation is probably frivolous, the fact that it is happening is an issue.
That is shocking that imports is down almost 40% for coal to China. That is a BIG HIT and will affect Peabody's numbers dramatically.
The future of export-oriented coal companies is heavily dependent on two markets, China and India. Among US coal companies, Peabody Energy (NYSE:BTU), with major coal exports from its Australian operations, is exposed.
Chinese coal consumption and importation
In eagerly awaited news, China's National Energy Administration has announced its coal statistics for the first 6 months of 2015. The numbers reinforce and expand on the results for 2014. A key finding is that it is now clear that China has disconnected its economic growth from coal usage. Electricity demand increased by 1.3% year on year January to June, while coal consumption fell by 5%, an increase in the pace of decline over the 3% decline over the whole of 2014. The refocus of the Chinese economy is evident in the detail of the electricity demand figures, as heavy industry demand decreased 0.9% year on year for first half of 2015, while consumer and service industry demand increased by 8.1% and residential demand increased by 4.8%.
Considering thermal coal, consumption peaked in 2013; it declined by 95 million tons in 2014 and is expected to decline a further 155 million tons in 2015. As might be expected from these figures the utilization of coal power plants fell from 54.2% in the first half of 2014 to 49.3% in the comparable period in 2015.
Two weeks ago the prospect of BTU below $1.50 seemed a way off. Today BTU closed at $1.41, down 7.84% on average volume. While the mean target price of 19 brokers is now $5.93 (down from $6.46 a few weeks ago) there is still an air of unreality in the broker estimates on this stock, with "buy" still substantially outnumbering "sell" recommendations.
With the latest news from China reinforcing my contention that coal is in long term decline, I suggest that new investors take a very deep breath before becoming a shareholder. The momentum for delisting and bankruptcy is building in the US coal industry and I suggest that while BTU is the biggest US coal company (with the biggest debt), that doesn't insulate it from reality.
I don't think it was that article as it was at 3 p..m. and this started to fall at exactly 2:45 and that is when most margin calls selling start at TD Ameritrade, Etrade, etc. Also, not to many people take anything seriously from Seeking Alpha. It isn't exactly the Wall Street Journal and widely distributed.
Walter Energy declared bankruptcy and ANR was delisted from NYSE and in process of seeking bankruptcy protection.
Can any one verify what he is saying by showing what the article is saying? I went to that website and nothing of the kind shows up about Peabody in the last two hours.
can you cut and paste that article?
Look what happened to ANR and BTU. Listen to the idiots who say they have all this cash. But it is BORROWED and CRK is paying some 10% on it.
Look at ANR that is delisted and prepared for bankruptcy, it shows some $906 million cash. As of yesterday the NYSE delisted the coal company.
Look at BTU that has dropped from $5 from 4 months ago to $1.28 today. IT shows $656 million in cash.
What happened? Was it a margin call?
Did it go up or down for each types of Thermal Coal and Met Coal?
Go back just 6 months and you see the same thing people said about WLT (walter Energy) and ANR and both are bankrupt now just 6 months later. Everyone said they had more than enough cash.
are you a buyer? or seller?
are you buying or in it already at a higher price?