Alliance Resource Partners(ARLP)2024-11-07 21:13Financial Performance - Total revenues for Q3 2024 decreased by 3.6% to 636.5 million in Q3 2023, primarily due to reduced coal sales prices and lower transportation revenues [140]. - Net income attributable to the company for Q3 2024 was 0.66 per unit, down from 1.18 per unit, in Q3 2023, reflecting lower revenues and increased operating expenses [143]. - Total revenues for the nine months ended September 30, 2024, decreased 4.3% to 1.94 billion for the same period in 2023, mainly due to lower coal sales and transportation revenues [159]. - Net income attributable to the company for the 2024 Period was 2.64 per unit, down from 3.93 per unit, in the 2023 Period [161]. Coal Operations - Coal sales decreased to 549.1 million in Q3 2023, driven by a 2.1% decline in average coal sales prices and lower tons sold [144]. - Segment Adjusted EBITDA for coal operations increased by 10.9% to 46.11 per ton sold in Q3 2024 [145]. - Segment Adjusted EBITDA decreased by 192.3 million in Q3 2024 from 114.6 million in Q3 2024 from 37.5 million in Q3 2024 from 1.61 billion for the 2024 Period compared to 1.10 billion, with per ton costs rising 11.4% to 1.04 billion, while Segment Adjusted EBITDA decreased by 2.9% to 157.1 million, with coal sales decreasing by 16.3% to 33.5 million, reflecting higher average royalty rates and increased tons sold [180]. Transportation Revenues - Transportation revenues decreased to 35.0 million in Q3 2023, attributed to lower average third-party transportation rates and decreased coal shipments [151]. - Transportation revenues decreased by 82.1 million in the 2024 Period, primarily due to decreased coal shipments [169]. Operating Expenses - Total operating expenses increased to 1.38 billion in the 2023 Period, primarily due to higher cost purchased coal and a 1.12 billion, primarily due to higher operating expenses across segments [1]. Cash Flow and Investments - Cash provided by operating activities decreased to 730.3 million in the 2023 Period [190]. - Net cash used in investing activities decreased to 439.4 million in the 2023 Period, primarily due to reduced acquisitions of oil & gas reserves [191]. - Net cash used in financing activities decreased to 389.7 million in the 2023 Period, mainly due to the issuance of Senior Notes and borrowings under Equipment Financing [192]. - The company anticipates total capital expenditures for 2024 to be in the range of 460.0 million, with average estimated annual maintenance capital expenditures projected at approximately 195.4 million in cash and cash equivalents, which is expected to be sufficient to meet 2024 cash requirements [193]. Oil & Gas Operations - The company owns oil & gas mineral interests in approximately 69,000 net royalty acres in premier producing regions, supporting its strategy to grow its oil & gas mineral interest business [129]. - The company has committed up to 25.0 million to acquire additional oil & gas mineral interests in the Midland and Delaware Basins for an additional one-year term [131]. - Oil & Gas Royalties Segment Adjusted EBITDA decreased 8.5% to 28.7 million in Q3 2024 compared to 91.4 million, driven by a 12.3% rise in oil & gas volumes to 2,579 MBOE [179]. Risk Factors - The company is exposed to commodity price risks, particularly in coal, oil, and natural gas, which could significantly impact revenues if prices decline [200]. - Credit risk is primarily associated with domestic electric power generators and reputable global brokerage firms, with measures in place to evaluate and monitor customer creditworthiness [202]. - The company does not have material exposure to currency exchange-rate risks as most transactions are in U.S. dollars, but foreign competitors may gain advantages from currency fluctuations [203]. - Borrowings under the Revolving Credit Facility and Securitization Facility are at variable rates, exposing the company to interest rate risks [204]. - There were no significant changes in the company's quantitative and qualitative disclosures about market risk compared to the previous annual report [205].