Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT ON FORM 8-K - James River Coal CO | jrcc_8k-110309.htm |
| EX-99.1 - PRESS RELEASE - James River Coal CO | jrcc_8k-ex9901.htm |
Exhibit 99.2
Shareholder
Update
November
2009
2
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, guidance
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 diversify 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).
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, guidance
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 diversify 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).
Agenda
● Opening
Comments
● Market
Review
● Miscellaneous
4
Opening
Comments
Summary
● A Very Quiet Quarter
at James River Coal Company
● A Very Quiet Quarter
at James River Coal Company
● Continuing our
Strong Financial Performance
● Continuing our
Strong Financial Performance
● Reached Agreements
to Sell 428,000 Tons of CAPP at an Average Price of
$73.16 Per Ton and 1.5 Million Tons of ILB at an Average of $44.57 Per
Ton
$73.16 Per Ton and 1.5 Million Tons of ILB at an Average of $44.57 Per
Ton
● Reached Agreements
to Sell 428,000 Tons of CAPP at an Average Price of
$73.16 Per Ton and 1.5 Million Tons of ILB at an Average of $44.57 Per
Ton
$73.16 Per Ton and 1.5 Million Tons of ILB at an Average of $44.57 Per
Ton
● Continuing to Make
Minor Adjustments to Production Schedules in
Response to Soft Coal Markets
Response to Soft Coal Markets
● Continuing to Make
Minor Adjustments to Production Schedules in
Response to Soft Coal Markets
Response to Soft Coal Markets
● Continuing to
Maintain Close Relationships with Domestic Utility Customers
and International Market Participants
and International Market Participants
● Continuing to
Maintain Close Relationships with Domestic Utility Customers
and International Market Participants
and International Market Participants
● Continuing to
Position JRCC for the Next Strong Market Cycle Through
Investments in our People and our Fleet of Equipment
Investments in our People and our Fleet of Equipment
● Continuing to
Position JRCC for the Next Strong Market Cycle Through
Investments in our People and our Fleet of Equipment
Investments in our People and our Fleet of Equipment
Agenda
● Operations
Review
● Market
Review
● Opening
Comments
● Miscellaneous
6
Operations
Review
Q-3
Safety
● Continued Strong
Trend in Safety Performance
● Continued Strong
Trend in Safety Performance
● NFDL Rate Reduced
36% Over 2008, Well Below National
Average
Average
● NFDL Rate Reduced
36% Over 2008, Well Below National
Average
Average
● McCoy, Triad
Underground and James River Coal Service had
Zero Lost Time Accidents for the Quarter
Zero Lost Time Accidents for the Quarter
● McCoy, Triad
Underground and James River Coal Service had
Zero Lost Time Accidents for the Quarter
Zero Lost Time Accidents for the Quarter
● Mine 16 (McCoy)
Awarded Safest Underground Mine in Pikeville
District for 2008 by Kentucky OMSL
District for 2008 by Kentucky OMSL
● Mine 16 (McCoy)
Awarded Safest Underground Mine in Pikeville
District for 2008 by Kentucky OMSL
District for 2008 by Kentucky OMSL
● Beechfork
(Bledsoe) Awarded Safest Underground Mine in
Barboursville District for 2008 by Kentucky OMSL
Barboursville District for 2008 by Kentucky OMSL
● Beechfork
(Bledsoe) Awarded Safest Underground Mine in
Barboursville District for 2008 by Kentucky OMSL
Barboursville District for 2008 by Kentucky OMSL
7
Operations
Review
Q-3
Central Appalachia
● Reduced Costs
$1.82 a Ton While Cutting Production by 81,000 Tons
● Reduced Costs
$1.82 a Ton While Cutting Production by 81,000 Tons
● Managed
Inventories Through Adjustments to Operating Schedules
● Managed
Inventories Through Adjustments to Operating Schedules
● CAPP Mines Idled
for One Unplanned Day During Q-3
● CAPP Mines Idled
for One Unplanned Day During Q-3
● Began Construction
of a New Impoundment for McCoy
● Began Construction
of a New Impoundment for McCoy
● Began Production
at Jellico Underground Replacement Mine at Bell
● Began Production
at Jellico Underground Replacement Mine at Bell
● Completed
Development of New Portal for Mine 75 at Blue Diamond
● Completed
Development of New Portal for Mine 75 at Blue Diamond
● Permitting Delays
Continue Both on State and Federal Level
● Permitting Delays
Continue Both on State and Federal Level
9
Operations
Review
Q-3
Illinois Basin
● Managed Production
to Match Shipping Schedules
● Managed Production
to Match Shipping Schedules
● Surface Production
Decreased from Q-2 While Underground
Production Increased
Production Increased
● Surface Production
Decreased from Q-2 While Underground
Production Increased
Production Increased
● Continued
Development of the Freelandville West Underground
Mine Site
Mine Site
● Continued
Development of the Freelandville West Underground
Mine Site
Mine Site
● Costs Increased
$1.34 a Ton Due Mainly to Decreased Surface
Production and Increased Repair & Maintenance Activities
Production and Increased Repair & Maintenance Activities
● Costs Increased
$1.34 a Ton Due Mainly to Decreased Surface
Production and Increased Repair & Maintenance Activities
Production and Increased Repair & Maintenance Activities
Agenda
● Operations
Review
● Market
Review
● Opening
Comments
● Miscellaneous
Market
Review
EPA
Seeks to Appoint an Ad Hoc Science
Panel to Study Surface Mining
Panel to Study Surface Mining
Vietnam
Raises Coal Prices
to
Reduce Exports
News
and Notes
EPA
Revokes Validly Issued Permit
Eskom
(South Africa) to Increase Their Coal Burn
From
125 Million Tons Today to 200 Million Tons in 2018
European
Court Repeals
Cuts
in CO²
Caps
Watch
Russia Not India
South
Korea Substantially
Increases
Their
Coking Coal Imports
Somali
Pirates Capture Ship
Loaded
with Coal
Russia
Building New Rail Tunnels to
Increase Exports to Asia
Increase Exports to Asia
Market
Review
2009
Net CAPP to South Atlantic Utilities
Source:
Genscape
Source:
Genscape
CAPP
Midwest
Market
Review
New
Sales Commitments
● Sold 389,000 Tons
for 2010 at $72.62
● Sold 389,000 Tons
for 2010 at $72.62
● Sold 39,000 Tons
for 2011 at $78.57
● Sold 39,000 Tons
for 2011 at $78.57
● Sold 1,000,000
Tons for 2011 at $44.36
● Sold 1,000,000
Tons for 2011 at $44.36
● Sold 500,000 Tons
for 2012 at $45.00
● Sold 500,000 Tons
for 2012 at $45.00
We
Have Seen an Improvement in the Market
For
Industrial Stoker Coal and Crossover Met Blends
15
Market
Review
*
Our
Summary View of The World
Today
Today
Phase
I
Phase
II
Phase
III
Phase
IV
Demand
Falls
Demand
Falls
Hard
Hard
Inventories
Adjust
Adjust
Inventories
Adjust
Adjust
Supply
Falls
Supply
Falls
Hard
Hard
Markets
Adjust
Adjust
Markets
Adjust
Adjust
Market
Review
Our
Summary View of The World
● The Eastern U.S.
Thermal Coal Market Continues to Need an
Overall Shift of +/- 30 Million Tons to Improve
Overall Shift of +/- 30 Million Tons to Improve
● The Eastern U.S.
Thermal Coal Market Continues to Need an
Overall Shift of +/- 30 Million Tons to Improve
Overall Shift of +/- 30 Million Tons to Improve
● The Most Likely
Source of This Shift Will be a Combination of:
● The Most Likely
Source of This Shift Will be a Combination of:
- Lower CAPP
Production
- Lower CAPP
Production
- Less Fuel
Switching to Natural Gas
- Less Fuel
Switching to Natural Gas
- Improved Electric
Generation for Industrial Activity
- Improved Electric
Generation for Industrial Activity
- Crossover (Flex)
Tons Moving into the Met Market
- Crossover (Flex)
Tons Moving into the Met Market
We
Believe that the Market Will Adjust in Late 2010 or Early 2011.
Our
Contract Portfolio Gives Us Flexibility to Manage Through the
Downturn
Agenda
● Operations
Review
● Market
Review
● Opening
Comments
● Miscellaneous
18
Temporary Change
to Shareholder Rights Plan
● Lower Threshold
From 20% to 4.9%
● Lower Threshold
From 20% to 4.9%
● Temporary Change
That Will Expire on December 5, 2010
● Temporary Change
That Will Expire on December 5, 2010
● Necessary to
Protect Substantial Tax Assets
● Necessary to
Protect Substantial Tax Assets
- Regular Net
Operating Loss (NOL) Tax Carryforwards of
approximately $240 Million
approximately $240 Million
- Regular Net
Operating Loss (NOL) Tax Carryforwards of
approximately $240 Million
approximately $240 Million
- Alternative
Minimum Tax (AMT) NOL’s of
approximately $150 Million
approximately $150 Million
- Alternative
Minimum Tax (AMT) NOL’s of
approximately $150 Million
approximately $150 Million
Miscellaneous
Miscellaneous
|
Upcoming
Investor Conferences and Meetings
(Webcast
May be Accessed at www.jamesrivercoal.com)
|
||
|
November 05,
2009
|
Davenport
and Company
4th Annual Metals
and Mining Conference
|
New
York
|
|
November 10,
2009
|
Raymond
James
2nd Annual Coal
Investors Conference
|
New
York
|
|
November 30,
2009
|
Macquarie
Global
Metals and Mining Conference
|
New
York
|
|
December 01,
2009
|
UBS
Coal 1 on 1
Conference
|
Boston
|
|
December 02,
2009
|
Bank of
America
2009 Credit
Conference
|
New
York
|
19
|
Late
February
|
4th Quarter
Earnings Release
2010
Guidance
|
20
Question and
Answer
Session
Session
