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Alliance Resource (ARLP) Q4 Earnings Meet, Revenues Miss

Zacks Equity Research
·4 min read

Alliance Resource Partners, L.P. ARLP reported fourth-quarter 2019 operating earnings of 20 cents per unit, which came in line with the Zacks Consensus Estimate.

Operating earnings plunged 47.4% from the year-ago reported bottom line of 38 cents per unit. This year-over-year decrease is primarily due to lower total revenues, partially offset by lower total operating expenses.

Total Revenues

Total revenues in the reported quarter were $453.3 million, lagging the Zacks Consensus Estimate of $463 million by 2.2% and also declining 14.8% from $531.8 million in the year-ago period.

The year-over-year decline in the top line was due to weak coal sales revenues resulting from contracted coal sales volumes and prices, partially offset by the addition of oil & gas royalty revenues in the fourth quarter.

 

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. Price, Consensus and EPS Surprise

Alliance Resource Partners, L.P. price-consensus-eps-surprise-chart | Alliance Resource Partners, L.P. Quote

 

Highlights of the Release

In the reported quarter, Alliance Resource sold 9.43 million tons of coal at an average sales price of $42.95 per ton compared with 10.46 million tons at an average sales price of $46.34 in fourth-quarter 2018.

Total operating expenses in the quarter under review were $417.4 million, decreasing 13.5% year over year.

Interest expenses were $12.04 million, increasing 25.9% year over year.

Segmental Details

Coal Operations: Adjusted EBITDA from this segment was $129.4 million, declining 29.8% year over year.

Minerals: Adjusted EBITDA from this segment was $14.6 million, skyrocketing 100% year over year.

Financial Update

Cash and cash equivalents as of Dec 31, 2019 were $36.5 million compared with $244.2 million at the end of 2018.

Long-term debt as of the same date was $768.2 million compared with $564 million at 2018-end.

Cash flows from operating activities for the year ended Dec 31, 2019 were $514.9 million compared with $694.3 million in the comparable period last year.

Guidance

For 2020, Alliance Resource expects oil & gas production to jump 52% from the current levels. Oil & gas royalties’ revenues and Segment Adjusted EBITDA are also expected to be 56% and 62% higher, respectively. The company anticipates total coal production in the range of 35.5 - 37.5 million short tons.

Net income for 2020 is projected in the band of $81 - $159 million and capital expenditures in the bracket of $165 - $190 million.

The company predicts 2020 revenues within $1.65 - $1.77 billion and EBITDA in the range of $465 - $540 million.

Zacks Rank

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

Upcoming Releases

Peabody Energy Corporation BTU is set to release fourth-quarter earnings on Feb 5, 2020. The Zacks Consensus Estimate for the quarter to be reported stands at a loss of 93 cents per share.

CONSOL Energy Inc. CEIX is scheduled to release fourth-quarter earnings on Feb 11, 2020. The Zacks Consensus Estimate for the to-be-reported quarter is pegged at 57 cents per share.

Warrior Met Coal, Inc. HCC is slated to release fourth-quarter earnings on Feb 19, 2020. The Zacks Consensus Estimate for the quarter to be reported is pegged at 21 cents per share.

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Alliance Resource Partners, L.P. (ARLP) : Free Stock Analysis Report
 
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