Attached files
file | filename |
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8-K - CURRENT REPORT ON FORM 8-K - James River Coal CO | jrcc_8k-110309.htm |
EX-99.2 - PRESENTATION - James River Coal CO | jrcc_8k-ex9902.htm |
Exhibit 99.1
FOR IMMEDIATE
RELEASE
CONTACT:
|
James
River Coal Company
Elizabeth
M. Cook
Director
of Investor Relations
(804)
780-3000
|
JAMES
RIVER COAL COMPANY REPORTS
THIRD
QUARTER 2009 OPERATING RESULTS
§
|
Q-3 Earnings per Share of
$0.36 Compared to ($.86) in
2008
|
§
|
Q-3 Adjusted EBITDA of $33.2
Million Compared to $7.1 Million in
2008
|
§
|
Cash Costs in CAPP Decline by
$1.82 Per Ton Compared with Q-2 Despite Lower Production
Levels
|
§
|
Cash Margin in CAPP of
$22.73 Per Ton Compared with $5.43 in Q-3
2008
|
§
|
New Contracts for CAPP at an
Average of $73.16 Per Ton and Midwest at an Average of
$44.57
|
§
|
Temporary Amendment to
Shareholder Rights Plan to Preserve Substantial NOL Tax
Assets
|
RICHMOND, VA., November 3, 2009 -
James River Coal Company (NASDAQ: JRCC), a producer of steam and
industrial-grade coal, today announced that it had net income of $9.8 million or
$0.36 per fully diluted share for the third quarter of 2009 and net income of
$54.2 million or $1.97 per fully diluted share for the nine months ended
September 30, 2009. This is compared to a net loss of $21.7 million
or $0.86 per fully diluted share for the third quarter of 2008 and a net loss of
$62.4 million or $2.62 per fully diluted share for the nine months ended
September 30, 2008.
Peter T.
Socha, Chairman and Chief Executive Officer commented: “This was a relatively
quiet quarter at James River Coal Company. We are continuing to post
very strong financial results for our shareholders. In the operations
area, we have continued to invest in both people and equipment in preparation
for the next strong coal market. In the sales area, we have continued
to maintain very close relationships with our domestic utility customers and
international market participants. In the financial area, we have
continued to strengthen our balance sheet through paying down a substantial
amount of debt and starting to accumulate a cash balance. In summary,
we are pleased with our results today, but we are also very busy planning and
taking actions that will lead to an even better tomorrow.”
1
FINANCIAL
RESULTS
The
following tables show selected operating results for the quarter ended September
30, 2009 compared to the quarter ended September 30, 2008 (in 000’s except per
ton amounts).
Total
Results
|
Three
Months Ended September 30,
|
Nine Months
Ended September 30,
|
||||||||||||||
2009
|
2008
|
|||||||||||||||
Total
|
Total
|
Total
|
Total
|
|||||||||||||
Company
and contractor production (tons)
|
2,390 | 2,731 | 7,743 | 8,379 | ||||||||||||
Coal
purchased from other sources (tons)
|
17 | 30 | 79 | 227 | ||||||||||||
Total
coal available to ship (tons)
|
2,407 | 2,761 | 7,822 | 8,606 | ||||||||||||
Coal
shipments (tons)
|
2,439 | 2,777 | 7,477 | 8,591 | ||||||||||||
Coal
sales revenue
|
$ | 168,320 | $ | 151,842 | $ | 532,090 | $ | 427,733 | ||||||||
Cost
of coal sold
|
128,361 | 138,873 | 388,789 | 393,470 | ||||||||||||
Depreciation,
depletion, & amortization
|
15,572 | 17,158 | 45,967 | 52,000 | ||||||||||||
Gross
profit (loss)
|
24,387 | (4,189 | ) | 97,334 | (17,737 | ) | ||||||||||
Selling,
general & administrative
|
10,266 | 9,057 | 30,112 | 25,123 | ||||||||||||
Adjusted
EBITDA (1)
|
$ | 33,169 | $ | 7,099 | $ | 123,399 | $ | 17,774 |
(1)
|
Adjusted
EBITDA is defined under "Reconciliation of Non-GAAP Measures" in this
release. Adjusted EBITDA is used to determine compliance with
financial covenants in our senior secured credit
facilities.
|
Segment
Results
|
Three
Months Ended September 30,
|
|||||||||||||||
2009
|
2008
|
|||||||||||||||
CAPP
|
Midwest
|
CAPP
|
Midwest
|
|||||||||||||
Company
and contractor production (tons)
|
1,606 | 784 | 1,892 | 839 | ||||||||||||
Coal
purchased from other sources (tons)
|
17 | - | 30 | - | ||||||||||||
Total
coal available to ship (tons)
|
1,623 | 784 | 1,922 | 839 | ||||||||||||
Coal
shipments (tons)
|
1,647 | 792 | 1,932 | 845 | ||||||||||||
Coal
sales revenue
|
$ | 141,371 | 26,949 | $ | 123,691 | 28,151 | ||||||||||
Average
sales price per ton
|
85.84 | 34.03 | 64.02 | 33.31 | ||||||||||||
Cost
of coal sold
|
$ | 103,946 | 24,415 | $ | 113,187 | 25,686 | ||||||||||
Cost
of coal sold per ton
|
63.11 | 30.83 | 58.59 | 30.40 |
2
Segment
Results
|
Nine Months
Ended June 30,
|
|||||||||||||||
2009
|
2008
|
|||||||||||||||
CAPP
|
Midwest
|
CAPP
|
Midwest
|
|||||||||||||
Company
and contractor production (tons)
|
5,324 | 2,419 | 6,063 | 2,316 | ||||||||||||
Coal
purchased from other sources (tons)
|
79 | - | 227 | - | ||||||||||||
Total
coal available to ship (tons)
|
5,403 | 2,419 | 6,290 | 2,316 | ||||||||||||
Coal
shipments (tons)
|
5,092 | 2,385 | 6,290 | 2,301 | ||||||||||||
Coal
sales revenue
|
$ | 453,859 | 78,231 | $ | 353,388 | 74,345 | ||||||||||
Average
sales price per ton
|
89.13 | 32.80 | 56.18 | 32.31 | ||||||||||||
Cost
of coal sold
|
$ | 319,382 | 69,407 | $ | 322,549 | 70,921 | ||||||||||
Cost
of coal sold per ton
|
62.72 | 29.10 | 51.28 | 30.82 |
Cost
Bridge
|
Q-2
2009 vs. Q-3 2009
|
|||||||
CAPP
|
Midwest
|
|||||||
Beginning
cash costs (Q-2 2009)
|
$ | 64.93 | 29.49 | |||||
Labor
and benefits
|
(1.49 | ) | 0.23 | |||||
Plant
repairs
|
- | 0.42 | ||||||
Other
|
(0.33 | ) | 0.69 | |||||
Ending
cash costs (Q-3 2009)
|
$ | 63.11 | 30.83 |
C.K.
Lane, Senior Vice President and Chief Operating Officer commented: “We continue
to be very pleased with our safety results. Our NFDL (Non-Fatal Days
Lost) rate has been reduced 36% from the comparable period in 2008, which is
well below the national average. Our Central Appalachia operations
continued to perform well. We reduced our costs by $1.82 per ton
compared to the second quarter while decreasing production by 81,000 tons to
better manage inventories. We are continuing to make minor
adjustments to our production schedules to match our contract portfolio and the
needs of our customers. Beyond normal mine and train operations
issues, we have not had to delay or defer any utility shipments this
year. Our Illinois Basin operations had another strong
quarter. Surface production was reduced from the second quarter to
match shipping schedules for our customers.”
3
LIQUIDITY
AND CASH FLOW
|
As of
September 30, 2009, the Company had available liquidity of $42.6 million
calculated as follows (in millions):
Cash
and Cash Equivalents
|
$ | 7.6 | ||
Availability
under the Revolver
|
35.0 | |||
Drawn
under the Revolver
|
- | |||
Available
Liquidity
|
$ | 42.6 |
The
Company was in compliance with all of the covenants in its senior secured credit
facilities as of September 30, 2009.
For the
three months ended September 30, 2009 capital expenditures were $18.3
million.
Mr. Socha
commented: “Our liquidity position and the strength of our balance sheet
continues to improve dramatically. In addition to beginning to
accumulate a cash balance, we have paid down our revolver by $18 million and we
have reduced our trade accounts payable by approximately $5 million this
year.”
SALES
POSITION AND MARKET COMMENTS
As of
October 31, 2009, we had the following agreements to ship coal at a fixed and
known price (in 000’s except per ton amounts):
2010
Priced
|
||||||||||||||||||||||||
As
of July 31, 2009
|
As
of October 31, 2009
|
Change
|
||||||||||||||||||||||
Tons
|
Avg
Price Per Ton
|
Tons
|
Avg
Price Per Ton
|
Tons
|
Avg
Price Per Ton
|
|||||||||||||||||||
CAPP
|
4,782 | $ | 100.60 | 5,171 | $ | 98.49 | 389 | $ | 72.62 | |||||||||||||||
Midwest
(1)
|
2,642 | $ | 41.47 | 2,642 | $ | 41.47 | - | $ | - | |||||||||||||||
2011
Priced
|
||||||||||||||||||||||||
As
of July 31, 2009
|
As
of October 31, 2009
|
Change
|
||||||||||||||||||||||
Tons
|
Avg
Price Per Ton
|
Tons
|
Avg
Price Per Ton
|
Tons
|
Avg
Price Per Ton
|
|||||||||||||||||||
CAPP
|
2,350 | $ | 122.51 | 2,389 | $ | 121.80 | 39 | $ | 78.57 | |||||||||||||||
Midwest
(1)
|
375 | $ | 45.47 | 1,375 | $ | 44.66 | 1,000 | $ | 44.36 | |||||||||||||||
2012
Priced
|
||||||||||||||||||||||||
As
of July 31, 2009
|
As
of October 31, 2009
|
Change
|
||||||||||||||||||||||
Tons
|
Avg
Price Per Ton
|
Tons
|
Avg
Price Per Ton
|
Tons
|
Avg
Price Per Ton
|
|||||||||||||||||||
CAPP
|
350 | $ | 108.31 | 350 | $ | 108.31 | - | $ | - | |||||||||||||||
Midwest
(1)
|
- | $ | - | 500 | $ | 45.00 | 500 | $ | 45.00 |
(1) The
prices for the Midwest in 2010 are minimum base price amounts adjusted for
projected fuel escalators.
|
4
Mr. Socha
added: “We were very pleased to reach agreement for future deliveries from both
our CAPP and our Midwest operations this quarter. In particular, we
are beginning to see increased activity for industrial coal and flex coal that
is capable of moving from the utility market to the metallurgical
market. As widely reported, the market for domestic utility steam
coal continues to be very soft. This is a result of high inventories and lower
demand from electric utilities. While we can see a number of items
that should improve the overall domestic coal market in the future, it is still
very early. We continue to look for the coal market in Europe to
improve in the first half of 2010 and the market in the United States to improve
in late 2010 or early 2011. Our customer relationships and our
contract portfolio allow us to be patient with our contracting
activities.”
MODIFICATION
TO SHAREHOLDER RIGHTS PLAN
The
Company also announced today that its Board of Directors has amended its Rights
Agreement dated May 25, 2004, as amended, in order to preserve the Company’s
ability to utilize substantial net operating loss (NOL) carryforwards to offset
future taxable income under the Internal Revenue Code. The amendment will be
effective on November 3, 2009.
As of
December 31, 2008, the Company had regular federal NOL carryforwards of
approximately $240 million and federal alternative minimum tax (AMT) NOL
carryforwards of approximately $150 million.
The
Company’s ability to use these tax attributes would be substantially limited if
there were an “ownership change” as defined under Section 382 of the Internal
Revenue Code and IRS rules. In general, an “ownership change” would be
deemed to occur if there is a cumulative change of more than 50% over a rolling
three year period by shareholders owning more than 5% of the total outstanding
shares.
Previously
under the Rights Agreement, a triggering event occurred with the acquisition of
beneficial ownership of 20% of the stock of the Company. Pursuant to the
amendment approved by the Board, this threshold has been lowered to 4.9
%.
The
amendment exempts shareholders whose ownership exceeds 4.9 % at the effective
date of the amendment so long as they do not acquire more than an additional
0.5% of the stock of the Company without the advance approval of the Company’s
board.
The lower
threshold of 4.9 % will expire on December 5, 2010, at which time the threshold
will revert to the previous level.
The
amendment to the Rights Agreement is similar to tax benefit preservation plans
recently adopted by numerous other public companies with significant tax
attributes. The amendment is designed to protect shareholder value by
safeguarding valuable tax attributes of the Company.
The
amendment also expands the definition of beneficial ownership to capture all
derivatives and synthetic equity positions within the definition of beneficial
ownership for purposes of the Rights Agreement.
Additional
information regarding the amendment will be contained in a Form 8-K and in an
amendment to our Registration Statement on Form 8-A to be filed with the
Securities and Exchange Commission.
5
CONFERENCE CALL, WEBCAST AND
REPLAY: The Company will hold a conference call with
management to discuss the second quarter earnings on November 3, 2009 at 11:00
a.m. Eastern Time. The conference call can be accessed by dialing
877-397-0298, or through the James River Coal Company website at http://www.jamesrivercoal.com. International
callers, please dial 719-325-4834. A replay of the conference call
will be available on the Company’s website and also by telephone, at
888-203-1112 for domestic callers. International callers, please dial
719-457-0820: pass code 7718234.
James
River Coal Company mines, processes and sells bituminous steam and
industrial-grade coal primarily to electric utility companies and industrial
customers. The Company’s mining operations are managed through six
operating subsidiaries located throughout eastern Kentucky and in southern
Indiana.
FORWARD-LOOKING STATEMENTS:
Certain statements in this press release, and other written or oral statements
made by or on behalf of us are "forward-looking statements" within the meaning
of the federal securities laws. Statements regarding future events and
developments and our future performance, as well as management's expectations,
beliefs, plans, estimates or projections relating to the future, are
forward-looking statements within the meaning of these laws. These
forward-looking statements, are subject to a number of risks and uncertainties.
These risks and uncertainties include, but are not limited to, the following:
changes in the demand for coal by electric utility customers; the loss of one or
more of our largest customers; inability to secure new coal supply agreements or
to extend existing coal supply agreements at market prices; failure to diversity
our operations; failure to exploit additional coal reserves; the risk that
reserve estimates are inaccurate; increased capital expenditures; encountering
difficult mining conditions; increased costs of complying with mine health and
safety regulations; our dependency on one railroad for transportation of a large
percentage of our products; bottlenecks or other difficulties in transporting
coal to our customers; delays in the development of new mining projects;
increased costs of raw materials; lack of availability of financing sources; our
compliance with debt covenants; the effects of litigation, regulation and
competition; and the other risks detailed in our reports filed with the
Securities and Exchange Commission (SEC). Management believes that these
forward-looking statements are reasonable; however, you should not place undue
reliance on such statements. These statements are based on current expectations
and speak only as of the date of such statements. We undertake no obligation to
publicly update or revise any forward-looking statement, whether as a result of
future events, new information or otherwise.
6
JAMES
RIVER COAL COMPANY
AND
SUBSIDIARIES
Consolidated
Balance Sheets
(in
thousands, except share data)
September
30, 2009
|
December
31, 2008
|
|||||||
Assets
|
(unaudited)
|
|||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 7,635 | 3,324 | |||||
Receivables:
|
||||||||
Trade
|
46,372 | 33,086 | ||||||
Other
|
211 | 475 | ||||||
Total
receivables
|
46,583 | 33,561 | ||||||
Inventories:
|
||||||||
Coal
|
28,379 | 6,847 | ||||||
Materials
and supplies
|
11,279 | 9,581 | ||||||
Total
inventories
|
39,658 | 16,428 | ||||||
Prepaid
royalties
|
5,023 | 2,803 | ||||||
Other
current assets
|
5,422 | 5,094 | ||||||
Total
current assets
|
104,321 | 61,210 | ||||||
Property,
plant, and equipment, at cost:
|
||||||||
Land
|
7,239 | 6,693 | ||||||
Mineral
rights
|
230,932 | 229,841 | ||||||
Buildings,
machinery and equipment
|
353,560 | 320,982 | ||||||
Mine
development costs
|
40,178 | 39,596 | ||||||
Total
property, plant, and equipment
|
631,909 | 597,112 | ||||||
Less
accumulated depreciation, depletion, and amortization
|
285,193 | 252,264 | ||||||
Property,
plant and equipment, net
|
346,716 | 344,848 | ||||||
Goodwill
|
26,492 | 26,492 | ||||||
Other
assets
|
30,255 | 30,996 | ||||||
Total
assets
|
$ | 507,784 | 463,546 |
7
JAMES
RIVER COAL COMPANY
AND
SUBSIDIARIES
Consolidated
Balance Sheets
(in
thousands, except share data)
September
30, 2009
|
December
31, 2008
|
|||||||
Liabilities
and Shareholders' Equity
|
(unaudited)
|
|||||||
Current
liabilities:
|
||||||||
Current
maturities of long-term debt
|
$ | - | 18,000 | |||||
Accounts
payable
|
51,947 | 57,068 | ||||||
Accrued
salaries, wages, and employee benefits
|
10,015 | 6,642 | ||||||
Workers'
compensation benefits
|
9,300 | 9,300 | ||||||
Black
lung benefits
|
1,539 | 1,539 | ||||||
Accrued
taxes
|
5,729 | 4,457 | ||||||
Other
current liabilities
|
16,497 | 19,165 | ||||||
Total
current liabilities
|
95,027 | 116,171 | ||||||
Long-term
debt, less current maturities
|
150,000 | 150,000 | ||||||
Other
liabilities:
|
||||||||
Noncurrent
portion of workers' compensation benefits
|
48,707 | 46,477 | ||||||
Noncurrent
portion of black lung benefits
|
30,330 | 29,029 | ||||||
Pension
obligations
|
20,097 | 19,693 | ||||||
Asset
retirement obligations
|
39,370 | 36,409 | ||||||
Other
|
586 | 529 | ||||||
Total
other liabilities
|
139,090 | 132,137 | ||||||
Total
liabilities
|
384,117 | 398,308 | ||||||
Commitments
and contingencies
|
||||||||
Shareholders'
equity:
|
||||||||
Preferred
stock, $1.00 par value. Authorized 10,000,000
shares
|
- | - | ||||||
Common
stock, $.01 par value. Authorized 100,000,000
shares;
|
||||||||
issued
and outstanding 27,553,964 and 27,393,493 shares
|
||||||||
as
of September 30, 2009 and December 31, 2008, respectively
|
276 | 274 | ||||||
Paid-in-capital
|
275,431 | 272,366 | ||||||
Accumulated
deficit
|
(133,555 | ) | (187,712 | ) | ||||
Accumulated
other comprehensive loss
|
(18,485 | ) | (19,690 | ) | ||||
Total
shareholders' equity
|
123,667 | 65,238 | ||||||
Total
liabilities and shareholders' equity
|
$ | 507,784 | 463,546 |
8
JAMES
RIVER COAL COMPANY
AND
SUBSIDIARIES
Consolidated
Statements of Operations
(in
thousands, except per share data)
(unaudited)
Three
Months
|
Three
Months
|
|||||||
Ended
|
Ended
|
|||||||
September
30, 2009
|
September
30, 2008
|
|||||||
Revenues
|
$ | 168,320 | 151,842 | |||||
Cost
of sales:
|
||||||||
Cost
of coal sold
|
128,361 | 138,873 | ||||||
Depreciation,
depletion and amortization
|
15,572 | 17,158 | ||||||
Total
cost of sales
|
143,933 | 156,031 | ||||||
Gross
profit (loss)
|
24,387 | (4,189 | ) | |||||
Selling,
general and administrative expenses
|
10,266 | 9,057 | ||||||
Total
operating income (loss)
|
14,121 | (13,246 | ) | |||||
Interest
expense
|
3,923 | 4,625 | ||||||
Interest
income
|
(5 | ) | (55 | ) | ||||
Charges
associated with repayment and amendment of debt
|
- | 4,223 | ||||||
Miscellaneous
income, net
|
(43 | ) | (327 | ) | ||||
Total
other expense, net
|
3,875 | 8,466 | ||||||
Income
(loss) before income taxes
|
10,246 | (21,712 | ) | |||||
Income
tax expense
|
438 | - | ||||||
Net
income (loss)
|
$ | 9,808 | (21,712 | ) | ||||
Earnings
(loss) per common share
|
||||||||
Basic
earnings (loss) per common share
|
$ | 0.36 | (0.86 | ) | ||||
Diluted
earnings (loss) per common share
|
$ | 0.36 | (0.86 | ) |
9
JAMES
RIVER COAL COMPANY
AND
SUBSIDIARIES
Consolidated
Statements of Operations
(in
thousands, except per share data)
(unaudited)
Nine
Months
|
Nine
Months
|
|||||||
Ended
|
Ended
|
|||||||
September
30, 2009
|
September
30, 2008
|
|||||||
Revenues
|
$ | 532,090 | 427,733 | |||||
Cost
of sales:
|
||||||||
Cost
of coal sold
|
388,789 | 393,470 | ||||||
Depreciation,
depletion and amortization
|
45,967 | 52,000 | ||||||
Total
cost of sales
|
434,756 | 445,470 | ||||||
Gross
profit (loss)
|
97,334 | (17,737 | ) | |||||
Selling,
general and administrative expenses
|
30,112 | 25,123 | ||||||
Total
operating income (loss)
|
67,222 | (42,860 | ) | |||||
Interest
expense
|
11,790 | 13,700 | ||||||
Interest
income
|
(55 | ) | (317 | ) | ||||
Charges
associated with repayment and amendment of debt
|
- | 7,236 | ||||||
Miscellaneous
income, net
|
(187 | ) | (1,073 | ) | ||||
Total
other expense, net
|
11,548 | 19,546 | ||||||
Income
(loss) before income taxes
|
55,674 | (62,406 | ) | |||||
Income
tax expense
|
1,517 | - | ||||||
Net
income (loss)
|
$ | 54,157 | (62,406 | ) | ||||
Earnings
(loss) per common share
|
||||||||
Basic
earnings (loss) per common share
|
$ | 1.97 | (2.62 | ) | ||||
Diluted
earnings (loss) per common share
|
$ | 1.97 | (2.62 | ) | ||||
10
JAMES
RIVER COAL COMPANY AND SUBSIDIARIES
Condensed
Consolidated Statements of Cash Flows
(in
thousands)
(unaudited)
Nine
Months
|
Nine
Months
|
|||||||
Ended
|
Ended
|
|||||||
September
30, 2009
|
September
30, 2008
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
income (loss)
|
$ | 54,157 | (62,406 | ) | ||||
Adjustments
to reconcile net income (loss) to net cash provided
|
||||||||
by
operating activities
|
||||||||
Depreciation,
depletion, and amortization
|
45,967 | 52,000 | ||||||
Accretion
of asset retirement obligations
|
2,385 | 2,018 | ||||||
Amortization
of deferred financing costs
|
880 | 1,118 | ||||||
Stock-based
compensation
|
4,533 | 3,614 | ||||||
Gain
on sale or disposal of property, plant, and equipment
|
(24 | ) | (163 | ) | ||||
Defferred
tax expense
|
150 | - | ||||||
Write-off
of deferred financing costs
|
- | 2,383 | ||||||
Changes
in operating assets and liabilities:
|
||||||||
Receivables
|
(13,022 | ) | 5,661 | |||||
Inventories
|
(21,096 | ) | (3,740 | ) | ||||
Prepaid
royalties and other current assets
|
(2,548 | ) | (2,033 | ) | ||||
Other
assets
|
(289 | ) | 662 | |||||
Accounts
payable
|
(5,121 | ) | 5,958 | |||||
Accrued
salaries, wages, and employee benefits
|
3,373 | 2,107 | ||||||
Accrued
taxes
|
(269 | ) | (1,265 | ) | ||||
Other
current liabilities
|
(3,025 | ) | 6,327 | |||||
Workers'
compensation benefits
|
2,230 | 1,828 | ||||||
Black
lung benefits
|
1,301 | 1,027 | ||||||
Pension
obligations
|
1,609 | (1,218 | ) | |||||
Asset
retirement obligation
|
(422 | ) | (978 | ) | ||||
Other
liabilities
|
57 | 161 | ||||||
Net
cash provided by operating activities
|
70,826 | 13,061 | ||||||
Cash
flows from investing activities:
|
||||||||
Additions
to property, plant, and equipment
|
(48,651 | ) | (59,498 | ) | ||||
Proceeds
from sale of property, plant, and equipment
|
61 | 1,108 | ||||||
Net
cash used in investing activities
|
(48,590 | ) | (58,390 | ) | ||||
Cash
flows from financing activities:
|
||||||||
Borrowings
under Revolver
|
12,500 | 21,500 | ||||||
Repayments
under Revolver
|
(30,500 | ) | (8,500 | ) | ||||
Repayment
of long-term debt
|
- | (22,025 | ) | |||||
Net
proceeds from issuance of common stock
|
- | 93,955 | ||||||
Debt
issuance costs
|
- | (486 | ) | |||||
Proceeds
from exercise of stock option
|
75 | 542 | ||||||
Net
cash provided by (used in) financing activities
|
(17,925 | ) | 84,986 | |||||
Increase
(decrease) in cash
|
4,311 | 39,657 | ||||||
Cash
at beginning of period
|
3,324 | 5,413 | ||||||
Cash
at end of period
|
$ | 7,635 | 45,070 |
11
JAMES
RIVER COAL COMPANY
AND
SUBSIDIARIES
Reconciliation
of Non-GAAP Measures
(in
thousands)
(unaudited)
EBITDA is
a measure used by management to measure operating performance. We
define EBITDA as net income or loss plus interest expense (net), income tax
expense (benefit) and depreciation, depletion and amortization (EBITDA), to
better measure our operating performance. We regularly use EBITDA to
evaluate our performance as compared to other companies in our industry that
have different financing and capital structures and/or tax rates. In
addition, we use EBITDA in evaluating acquisition targets.
Adjusted
EBITDA is the amount used in several of the covenants in our senior secured
credit facilities. Adjusted EBITDA is defined as EBITDA further
adjusted for certain cash and non-cash charges. Adjusted EBITDA is
used to determine compliance with financial covenants and our ability to engage
in certain activities such as incurring additional debt and making certain
payments.
Cash
margin per ton is an additional measure used by management to better measure our
operating performance. Cash margin per ton is a measure to evaluate a
company's profitability from produced tons sold. Cash margin per ton
is defined as gross profit or loss plus depreciation, depletion and amortization
divided by tons sold for the period.
EBITDA,
Adjusted EBITDA and cash margin are not recognized terms under GAAP and are not
an alternative to net income, operating income or any other performance measures
derived in accordance with GAAP or an alternative to cash flow from operating
activities as a measure of operating liquidity. Because not all
companies use identical calculations, this presentation of EBITDA, Adjusted
EBITDA and cash margin may not be comparable to other similarly titled measures
of other companies. Additionally, EBITDA and Adjusted EBITDA are not
intended to be a measure of free cash flow for management’s discretionary use,
as they do not reflect certain cash requirements such as tax payments, interest
payments and other contractual obligations.
Three
Months Ended
|
Nine Months
Ended
|
|||||||||||||||
September
30,
|
September
30,
|
September
30,
|
September
30,
|
|||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Net
income (loss)
|
$ | 9,808 | (21,712 | ) | 54,157 | (62,406 | ) | |||||||||
Income
tax expense
|
438 | - | 1,517 | - | ||||||||||||
Interest
expense
|
3,923 | 4,625 | 11,790 | 13,700 | ||||||||||||
Interest
income
|
(5 | ) | (55 | ) | (55 | ) | (317 | ) | ||||||||
Depreciation,
depletion, and amortization
|
15,572 | 17,158 | 45,967 | 52,000 | ||||||||||||
EBITDA
(before adjustments)
|
$ | 29,736 | 16 | 113,376 | 2,977 | |||||||||||
Other
adjustments specified
|
||||||||||||||||
in
our current debt agreement:
|
||||||||||||||||
Charges
associated with repayment of debt
|
- | 4,223 | - | 7,236 | ||||||||||||
Other
adjustments
|
3,433 | 2,860 | 10,023 | 7,561 | ||||||||||||
Adjusted
EBITDA
|
$ | 33,169 | 7,099 | 123,399 | 17,774 |
12