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December 03, 2008


Peabody net income in Q1 falls by 30% YoY

US coal producer Peabody Energy Corp announced that its April to June 2007 quarter profits fell by 30%YoY. Peabody said that its net income fell to USD 107.7 million from USD 153.4 million and sales were little changed at USD 1.32 billion as operating costs rose 2.3% YoY to USD 1.08 billion.

April to June 2007 quarter EBITDA rose by 9%YoY to a record USD 304.6 million from USD 278.8 million in 2006. EBITDA reflects improved US coal pricing and increased volumes from Australia, along with greater contributions from Trading and Brokerage and Resource Management.

Operating profit increased by 7%YoY to USD 188.6 million for the quarter. As anticipated, results reflect USD 51.6 million of higher depreciation, depletion and amortization and interest expense following last year's Excel acquisition. The benefits of new and expanded operations from the acquisition are expected to fully contribute in 2008.

Mr Gregory H Boyce president & CEO of Peabody said that "Peabody is dramatically reshaping our global platform, with major enhancements to our flagship Powder River Basin operations, expansion in Australia, strategic evaluation of our Eastern operations and a larger global trading presence. The depth and breadth of Peabody's portfolio delivered record EBITDA while overcoming a number of external challenges this quarter. We look forward to completing planned activities in 2007, leading to 2008 when the strength of our operating platform will leverage rising global coal demand and pricing."

For the six-month period, net income was USD 196.2 million down from USD 283.7 million in the same period a year ago. Revenues for the period increased to USD 2.687 billion from USD 2.628 billion in the last year period.

Peabody has cut full year sales projection to a range of 260 million tons to 275 million tons attributed coal chain infrastructure disruptions and an additional 5 million tons reduction in planned production growth, to accelerate inventory rebalancing and reflect expected shipments. US production is estimated at 220 million tons to 225 million tons and Australian production 20 million tons to 22 million tons, along with trading and brokerage volumes.