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Alliance Resource (ARLP) Beats on Q1 Earnings, Ups '17 View

Zacks Equity Research

Alliance Resource Partners, L.P.’s ARLP first-quarter 2017 earnings of $1.10 per unit surpassed the Zacks Consensus Estimate of 77 cents. Quarterly earnings escalated 42.9% year over year.

The year-over-year upside was primarily owing to stronger-than-anticipated exports and emphasis to reduce cost that have helped counter the mild U.S. winter.

Total Revenue

Alliance Resource’s revenues of $461.1 millionin the first quarter surpassed the Zacks Consensus Estimate of $448.2 million by 2.79%. Reported revenues also rose by 11.7% from $412.8 million reported a year ago.

The top line increased on account of increased coal sales volumes, and higher other sales and operating revenues.

Highlights of the Release

Total operating expenses of the partnership during the quarter were $353.5 million, down 1.2% from $357.9 million incurred in the year-ago period. The decrease in total operating expenses was primarily due to lower general and administrative expenses, transportation, as well as depreciation and amortization expenses.

Alliance Resource Partners registered a 14.9% year-over-year increase in production volume in the reported quarter to 10.2 million tons. Tons sold in the reported quarter increased 28.9% year over year to 9.6 million tons.

Alliance Resource Partners, L.P. Price, Consensus and EPS Surprise


Alliance Resource Partners, L.P. Price, Consensus and EPS Surprise | Alliance Resource Partners, L.P. Quote


In 2017, Alliance Resource expects revenues in the range of $1.78–$1.82 billion. The guidance excludes transportation revenues.

Coal production volume for 2017 is projected in a range of 38.1–39.1 million tons and sales volumes are estimated in a band of 38.5–39.5 million tons.

EBITDA is anticipated to range between $605 million and $645 million and net income is expected to come in the band of $290 million to $330 million in 2017.

The partnership expects to make capital investment in the range of $145–$165 million in 2017. Out of the planned investments, $20–$30 million will be directed towards the acquisition of oil and gas mineral interests.

Recent Peer Releases

CNX Coal Resources, LP CNXC reported first-quarter 2017 earnings of 50 cents per share, missing the Zacks Consensus Estimate of 55 cents per share by 10%.

SunCoke Energy, Inc SXC reported first-quarter 2017 earnings of 2 cent per share. The Zacks Consensus Estimate was pegged at a loss of 10 cents per share.

CloudPeak Energy, Inc CLD reported first-quarter 2017 loss of 30 cents per share. The Zacks Consensus Estimate was pegged at breakeven.

Zacks Rank

Alliance Resource currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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