DTC Coal “Earnings” Flash
DTC Flash©: Arch Coal Q3 2017 Earnings Analysis and Call Comments
Key takeaways and DTC’s insight from coal company quarterly results.
Arch Coal Q3 2017 Earnings Analysis and Call Comments
DTC Short and Sweet: Q3 revenues totaled $613.5mm, up from $549.9mm in Q2 mostly driven by higher PRB sales. Net income was $68.4mm, up from Q2 ($37.2mm). Operating costs rose in their Met segment to $64.46 from $60.95 in Q2 due to difficult mining conditions and rail service issues and fell in their PRB segment from $10.82 to $10.27on higher volume. ARCH raised its cash cost guidance in the Met segment as a result from $51-56/ton to $56-60/ton and lowered its met coal sales guidance to 6.6 – 6.8 mm tons from 6.9 – 7.1 mm tons in Q2 noting startup issues in the Cedar Grove seam at Mtn Laurel and a roll in the coal seam at Leer. ARCH noted that at the midpoint of their guidance they are now 99% committed for thermal sales in 2017 and more than 98% committed for coking coal sales with 10% of that on index-based pricing.
- Q3 2017 EPS: $2.83 diluted; $2.54 adjusted diluted (vs average analyst estimates of $1.82 and a range of $1.12 – $2.78)
- Q3 2017 Adj EBITDAR: $104.27 mm (vs $95.4 mm seq)
- Q3 2017 Sales (total): 26.2 mm tons (vs 22.5 mm tons seq)
- 2017 Guidance
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