Alliance Resource Partners, L.P. Q3 FY2020 Earnings Call

· Earnings call transcript and AI-powered summary

  • Total Revenues: $355.7 million, up 39.4% compared to Q2 2020.
  • Net Income: $27.2 million, up 158.3% from $10.5 million in Q2 2020.
  • EBITDA: $118.8 million, up 146.4% over Q2 2020.
  • Free Cash Flow: $103 million, increased 79% from the prior quarter.
  • Liquidity: $422.2 million, up 41.4% sequentially.
  • Total Debt Reduction: $100.8 million in Q3.
  • Total Leverage Ratio: 1.69x at the end of Q3, within covenant limits.

Coal Segment Highlights

  • Production volumes up 66.6%; sales volumes up 48.5% versus Q2 2020.
  • Coal sales revenue: $335.8 million, up 42.1% sequentially.
  • Segment Adjusted EBITDA: $123.8 million, up 124.4% from Q2.
  • Segment Cost per Ton: $28.03, down 22% from $35.95 in Q2.
  • Cost improvements driven by expense control, higher volumes, favorable sales mix, and lower inventory costs.

Minerals Segment Highlights

  • Oil and gas production increased 13.9% to 468,000 BOE from Q2.
  • Realized price per BOE increased 9.5% sequentially.
  • Revenue from royalties and lease bonuses totaled $9.7 million, up 23.9% sequentially.
  • Segment Adjusted EBITDA increased by 29.3% to $8.9 million.

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Operator: Good day, and welcome to the Alliance Resource, L.P. Third Quarter 2020 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions]. After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions]. Please note this event is being recorded. I would like now to turn the conference over to Brian Cantrell, Senior Vice President and CFO. Please go ahead. Brian Cantrell: Thank you, Matt, and welcome, everyone. Earlier this morning, Alliance Resource Partners released its third quarter 2020 financial and operating results, and we’ll now discuss these results as well as our prospective on market conditions and outlook. Following our prepared remarks, we’ll open the call to your questions. Before beginning, a reminder that some of our remarks today may include forward-looking statements that are 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. In providing these remarks, the partnership has no obligation to publicly update or revise any forward-looking statement whether as a result of

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