Cloud Peak Energy (CLD) Lags on Q4 Earnings, Issues '18 View

Cloud Peak Energy CLD reported a loss of 16 cents per share in fourth-quarter 2017, wider than the Zacks Consensus Estimate of a loss of a penny.

Revenues

Revenues totaled $213.9 million, down approximately 6.1% year over year from $227.9 million. The top line missed the Zacks Consensus Estimate of $246 million by 12.97%.

Segment Performance

Owned and Operated Mines

In the fourth quarter, the company sold 13.5 million tons of coal compared with 16.7 million tons in the year-ago quarter. Realized price per ton of coal during the quarter was $11.98, down nearly 1.4% year over year.  Revenues from this segment were $165.7 million, down 20.06% from $207.3 million in the year-ago quarter. The downside was caused by lower shipments at the company’s Antelope and Cordero Rojo mines.

Logistics and Related Activities

Total tons delivered during the reported quarter were 1.1 million, up from 0.5 million tons in the year-ago quarter. Revenues from this segment amounted to $60.5 million, surging 163% from $23.0 million in the year-ago quarter. Current pricing structure and increased Asian utility demand drove revenues.

 

Cloud Peak Energy Inc Price, Consensus and EPS Surprise

 

Cloud Peak Energy Inc Price, Consensus and EPS Surprise | Cloud Peak Energy Inc Quote

 

Highlight of the Release    

Total costs and expenses were $216.3 million, up 12.79% from $191.7 million in the year-ago quarter. This was primarily due to an increase in depreciation & depletion and cost of product sold.

The average per ton cost of coal sold during the quarter was $10.08, up from $8.96 in the fourth quarter of 2016. The cash margin of per ton coal sold declined 40.4% to $1.90 from $3.19 in the year-ago quarter.

The company entered into a long-term coal export sales agreement with JERA Trading Pvt Ltd. for supplying coal to two power plants in Japan. The coal export volumes are expected to touch 1.1 million tons in the final year of contract.

Financial Update

As of Dec 31, 2017, the company’s cash and cash equivalents were $107.9 million, up from $83.7 million as of Dec 31, 2016.

Senior notes were $405.2 million, lower than $475 million as of Dec 31, 2016.

Cash provided in operating activities of 2017 was $52.04 million, compared with $48.72 million in 2016.

Capital expenditure (excluding capitalized interest) during the quarter was $1.8 million, lower than $33.6 million in the year-ago quarter.

Guidance

For 2018, Cloud Peak Energy expects coal shipment from three mines in the range of 52-56 million tons. Out of the expected shipments, nearly 45 million tons are committed with a fixed price of $12.30 per ton.

Capital expenditures for 2018 are expected in the range of $15-$25 million.

Peer Releases

Peabody Energy Corporation BTU reported fourth-quarter 2017 adjusted earnings of $1.52 per share, beating the Zacks Consensus Estimate of $1.33 by 14.3%.

Arch Coal Inc. ARCH reported fourth-quarter 2017 adjusted earnings of $4.12 per share, beating the Zacks Consensus Estimate of $2.32 by 77.6%.

CONSOL Coal Resources LP CCR reported fourth-quarter 2017 adjusted earnings 48 cents per share, beating the Zacks Consensus Estimate of 45 cents by 6.7%.

Zacks Rank & Key Pick

Cloud Peak 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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