Alliance Resource Partners, L.P. Q2 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Financial Highlights

  • Revenue: $641.8 million, up 3.5% YoY.
  • Net Income: Up 3.8% YoY.
  • EBITDA: Up 1% YoY; Free cash flow before growth capex at $153.5 million, up 88.7% YoY.
  • Distribution: Maintained at $0.70 per unit quarterly ($2.80 annualized), 75% higher YoY.

Operational Highlights

  • Coal Sales Price Per Ton: Up 5.7% YoY; down 7.9% QoQ due to shipment timing from Tunnel Ridge Mine.
  • Coal Production: Up 5.8% YoY to 9.4 million tons. Coal sales volumes slightly decreased by 0.3% to 8.9 million tons resulting in 500,000 tons inventory buildup.
  • Segment Adjusted EBITDA Expense Per Ton (Coal Operations): $37.85, up 7.8% YoY; down 4.6% QoQ due to increased Tunnel Ridge output.
  • Oil & Gas Royalties Revenue: $50 million, down 8.3% YoY due to 40.2% decrease in avg. realized sales prices per BOE.
  • Oil & Gas Royalty Volume: Increased by 40.6% YoY.

Balance Sheet & Liquidity

  • Total Liquidity: $717.2 million including $284.9 million cash.
  • Senior Notes Repurchased: $34.2 million in Q2; $50 million retired in July 2023. $289.2 million remains.

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Operator: Greetings. Welcome to Alliance Resource Partners L.P. Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to Cary Marshall, Senior Vice President and Chief Financial Officer. Thank you. You may begin. Cary Marshall: Thank you, operator, and welcome, everyone. Earlier this morning, Alliance Resource Partners released its second quarter 2023 financial and operating results, and we will now discuss those results as well as our perspective on current market conditions and outlook for 2023. Following our prepared remarks, we will open the call to answer your questions. Before beginning, a reminder that some of our remarks today may include forward-looking statements subject to a variety of risks, uncertainties and assumptions contained in our filings from time to time with the Securities and Exchange Commission and are also reflected in this morning's press release. While these forward-looking statements are based on information currently available to us, if one or more of these risks or uncertainties materialize or if our underlying assumptions prove incorrect, actual results may vary materially from those we projected or expected. And in providing these remarks, the partnership has no obligation to publicly update or revise any forward-looking st

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