Cloud Peak Energy Inc. (NYSE:CLD), one of the largest U.S. coal
producers and the only pure-play Powder River Basin (PRB) coal company,
today announced results for the fourth quarter and full year 2011.
2011 Fourth Quarter and Full Year Highlights
Record Adjusted EBITDA(1) of $351.7 million for the full
year 2011 compared with $322.7 million for 2010; Adjusted EBITDA of
$92.9 million in the fourth quarter 2011 compared with $69.6 million
in the fourth quarter 2010.
Record annual shipments of 95.6 million tons from our three operated
mines.
Unrestricted cash and investments increased to $479.5 million as we
generated $296.8 million in cash from operations for the full year
2011 and released $111.0 million from previously restricted cash.
During the fourth quarter, we generated cash from operations of $84.3
million.
2011 net income of $189.8 million resulting in Adjusted EPS(1) of $2.47. Fourth quarter 2011 net income of $43.8 million and Adjusted
EPS of $0.70. Diluted fourth quarter 2011 EPS of $0.72 compared to
$0.36 in the fourth quarter 2010; diluted full year 2011 EPS of $3.13
compared to $1.06 in full year 2010.
Asian exports were up approximately 27 percent in the fourth quarter
2011 to 1.0 million tons from 0.8 million tons in the fourth quarter
2010. For the full year, Asian exports were 4.7 million tons, up 42
percent from 3.3 million tons in the full year 2010.
Proven and probable reserves increased to 1.37 billion tons at
December 31, 2011, up from 970 million tons at year end 2010 due to
the successful acquisition of coal leases at the Antelope mine in
Wyoming.
(1) Defined later.
'Our fourth quarter operations were on plan, resulting in record
shipments and record Adjusted EBITDA for the full year 2011,? said Colin
Marshall, President and Chief Executive Officer. 'In 2011, we focused on
maximizing our export opportunities, substantially increasing our
reserve base and controlling costs with great success.?
Operating Highlights (1)
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
Q4
Q4
Full Year
Full Year
2011
2010
2011
2010
Tons sold (in millions)
25.2
23.3
95.6
93.7
Realized price per ton sold
$
13.06
$
12.35
$
12.92
$
12.32
Average cost of product sold per ton
$
9.15
$
9.05
$
9.12
$
8.57
?
(1)
Includes the three company-operated mines only.
?
Shipments in the fourth quarter 2011 were up 8 percent over the fourth
quarter 2010 due to strong operating performance, solid customer demand,
and reliable rail service out of the Powder River Basin (PRB). Shipments
for the full year 2011 were up 2 percent over 2010. The higher demand
for our coal was primarily a result of our strong Asian export business.
Full year Asian exports increased 42 percent to 4.7 million tons, up
from 3.3 million tons in 2010.
Adjusted EBITDA for 2011 rose 9 percent to a record $351.7 million, up
from $322.7 million in 2010, driven by higher export sales, increased
realized prices and tight cost controls. The average price realized for
a ton of coal in 2011 was up 4.9 percent to $12.92 from $12.32 in 2010.
Our average cost per ton was $9.12 in 2011, up from $8.57 in 2010 driven
primarily by higher diesel prices throughout the year. The 2011 full
year operating margin was $3.80 per ton, up slightly from $3.75 per ton
for full year 2010.
Net income for 2011 was $189.8 million up from $117.2 million in 2010.
This increase was due to strong Asian export demand and an increase in
realized domestic prices.
Health, Safety and Environment Record
During 2011, of our nearly 1,400 full-time mine site employees, 17
suffered minor reportable injuries resulting in a MSHA All Injury
Frequency Rate of 1.18, an increase over the full year 2010 rate of
0.58. During 109 MSHA inspector days in 2011, we were issued 11
substantial and significant (S&S) citations, all of which have been
satisfactorily resolved and resulted in total proposed fines of $8,234.
'Our 2011 safety performance was disappointing given the very low injury
rates achieved in 2009 and 2010. Thankfully the injuries that were
incurred were relatively minor. We are all focused on reducing the
number of injuries in 2012,? said Marshall.
Reserves
The addition of the West Antelope II coal leases increased our year end
proven and probable reserves to 1.37 billion tons, up from 970 million
tons at the end of 2010. These leases increased our overall reserves by
40 percent. The West Antelope II reserves contain some of the lowest
sulfur and highest energy coal in the southern PRB, which is
particularly well suited to help utilities meet proposed EPA emissions
regulations. As previously disclosed, the West Antelope II leases are
subject to pending legal challenges against the Bureau of Land
Management (BLM) and the Secretary of the Interior by environmental
organizations. The Maysdorf II lease, which includes tracts we nominated
adjacent to our Cordero Rojo mine, is expected to be scheduled by the
BLM for lease in late 2012 or early 2013.
Operations
Our operations performed well during 2011 in spite of a wet spring,
which made conditions at the mines difficult, and extensive Midwestern
flooding, which impacted U.S. rail capacity during the second and third
quarters. During the period of reduced train shipments, the mines
focused on reclamation and overburden removal, which allowed the
increase in shipments in the fourth quarter when more trains were
available. Our continuing efforts to improve operational efficiency and
maintenance practices resulted in full year 2011 costs of $9.12 per ton,
at the low end of our guidance range. For 2012, the operations are well
placed as several major maintenance jobs were completed on draglines and
shovels and two additional shovels were added to our fleet.
Exports
Full year 2011 Asian exports of 4.7 million tons were up 42 percent from
2010 as we were able to opportunistically increase our exports through
the Westshore terminal and ship 0.7 million lower margin tons through
the Ridley terminal. We currently plan to ship approximately four
million tons through Westshore and approximately 0.3 million tons
through Ridley in 2012. However, the anticipated capacity expansion work
and resulting downtime at Westshore could impact planned shipments in
2012; we are working closely with Westshore to minimize any disruption.
As usual, we will look for opportunities to increase our 2012 exports if
terminal capacity becomes available and market conditions are
supportive. We currently have no additional shipments planned through
the Ridley terminal as prevailing international prices and the long
multi-line rail haul make new sales uneconomic. If market conditions
improve, we will evaluate opportunities for more sales through the
Ridley terminal. Additionally, we shipped limited tonnage through the
Great Lakes and through the Gulf of Mexico to customers in Europe during
2011. We will continue to evaluate additional opportunities throughout
2012.
During the fourth quarter, we entered a multi-year agreement with an
established Korean representative as part of our long-term plan to build
on our strong Asian export position. On an exclusive basis, the
representative will provide us with key marketing and consulting
services relating to sales to customers in South Korea. This agreement
replaces our earlier engagement of Rio Tinto for marketing services
relating to Asian exports.
Balance Sheet and Cash Flow
Cash flow from operations totaled $84.3 million for the fourth quarter
of 2011 compared to $63.9 million for the fourth quarter 2010. Capital
expenditures (excluding capitalized interest) were $26.7 million for the
fourth quarter 2011 compared to $27.9 million for fourth quarter 2010.
Cash flow from operations was $296.8 million for 2011 down from $324.8
million for full year 2010. Capital expenditures were $142.7 million for
the full year 2011 (including $34 million of capitalized interest)
compared to $91.6 million for the full year 2010, (including $27 million
of capitalized interest). In addition, coal lease payments of $133.2
million were made in 2011. This was up from $63.8 million in 2010 due to
the first payments on the West Antelope leases.
Unrestricted cash and investments as of December 31, 2011 were $479.5
million, up from $340 million at December 31, 2010. 'Supported by our
continued strong operational performance, we were able to secure
reductions in collateral requirements from almost all of our surety bond
providers, thereby releasing $111.0 million of restricted cash during
2011,? said Michael Barrett, Chief Financial Officer. 'Our total
available liquidity as of December 31, 2011 was $969 million, up 33
percent from the $730 million year end 2010 level.?
Outlook
While the current near-term outlook for the domestic coal markets is
uncertain, we believe Cloud Peak Energy is well placed for 2012 and
2013. Consistent with our marketing strategy, we are entering 2012
substantially sold out for our planned production. We have also
contracted 73.3 million tons to be delivered in 2013. This approach
allows us to run our production, maintenance and procurement operations
more efficiently and safely, which helps to control costs and allows
time to focus on operational improvements. Our coal shipments for 2012
are expected to be between 92.5 million tons and 96.5 million tons. For
2012, we have currently contracted to sell 94.3 million tons, of which
88.9 million tons are under fixed-price contracts with a
weighted-average price of $13.47 per ton. Assuming constant prices of
$10.00 per ton for 8800 Btu quality coal and $9.00 per ton for 8400 Btu
quality coal on our indexed tons, the expected total realized price for
2012 would be approximately $13.27 per ton. For 2013, we have currently
contracted to sell 73.3 million tons from our three company-operated
mines. Of this committed 2013 production, 58.3 million tons are under
fixed-price contracts with a weighted-average price of $14.27 per ton.
During the last quarter of 2011, we chose not to contract many tons as
uncertainty over EPA regulations and depressed natural gas prices
reduced coal prices significantly.
The current exceptionally mild winter has dramatically decreased demand
for electricity: since October 2011, heating degree days are down by 17
percent compared to normal, and electricity demand is estimated to be
down by 3.3 percent. This lack of demand is a major factor behind the
current low near-term gas and coal prices. Unless there is a dramatic
cold snap, these conditions are expected to persist until the summer.
However, due to the current low snow pack, 2012 hydro-electric
generation is likely to be significantly below the high 2011 levels
through the summer. Assuming a normal summer cooling season restores
electricity demand, gas prices and coal prices are expected to increase
later in the year, only then will it be possible to gauge the impact of
increased natural gas production on coal prices and demand.
The announcement of the EPA′s Cross State Air Pollution Rule (CSAPR) and
then its subsequent stay by the federal court, together with the EPA′s
Mercury and Air Toxics Standard (MATS) rule, has caused uncertainty
regarding how and when power plants will meet the necessary regulatory
requirements. In turn, this is causing uncertainty as utilities consider
their fuel alternatives and demand for coal. The low natural gas prices
and environmental regulations appear to be impacting demand for higher
cost coal from basins outside of the PRB most significantly. As the
lowest cost major basin in the U.S. producing some of the lowest sulfur
coal, we believe that demand for PRB coal will remain resilient despite
the current uncertainties.
2012 Guidance ? Financial and Operational Estimates
For 2012, we are enhancing our guidance information to include an
Adjusted EBITDA range to assist our investors in better understanding
management′s current expectations for the full year performance of our
core operations.
The following table provides our current outlook and assumptions for
selected 2012 financial and operational metrics:
Item
?
?
?
?
Estimate or Estimated Range
Coal shipments for our three operated mines
?
?
?
?
92.5 - 96.5 million tons
Committed sales with fixed prices
?
?
?
?
Approximately 88.9 million tons
Anticipated realized price of produced coal with fixed prices
?
?
?
?
Approximately $13.47 per ton
Adjusted EBITDA
?
?
?
?
$300 - $370 million
Net interest expense
?
?
?
?
Approximately $30 million
Depreciation, depletion and accretion
?
?
?
?
$105 - $115 million
Effective income tax rate (1)
?
?
?
?
Approximately 36%
Capital expenditures (2)
?
?
?
?
$70 - $90 million
Committed federal coal lease payments
?
?
?
?
$129 million
?
?
?
?
(1) Excluding impact of the Tax Receivable Agreement.
(2) Excluding capitalized interest and federal coal lease payments.
Following the live web cast, a replay will be available at the same URL
on our website for seven days. A telephonic replay will also be
available approximately two hours after the call and can be accessed by
dialing 888.286.8010 (domestic) or 617.801.6888 (international) and
entering pass code 95978431. The telephonic replay will be available for
seven days.
About Cloud Peak Energy ?
Cloud Peak Energy Inc. (NYSE:CLD) is headquartered in Wyoming and
is one of the largest U.S. coal producers and the only pure-play PRB
coal company. As one of the safest coal producers in the nation, Cloud
Peak Energy specializes in the production of low sulfur, subbituminous
coal. The company owns and operates three surface coal mines in the PRB,
the lowest cost major coal producing region in the nation. The Antelope
and Cordero Rojo mines are located in Wyoming and the Spring Creek mine
is located near Decker, Montana. With approximately 1,600 employees, the
company is widely recognized for its exemplary performance in its safety
and environmental programs. Cloud Peak Energy is a sustainable fuel
supplier for approximately 4 percent of the nation′s electricity.
This release and our related presentation contain 'forward-looking
statements? within the meaning of the safe harbor provisions of Section
27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Forward-looking statements are not statements of
historical facts and often contain words such as 'may,? 'will,?
'expect,? 'believe,? 'anticipate,? 'plan,? 'estimate,? 'seek,? 'could,?
'should,? 'intend,? 'potential,? or words of similar meaning.
Forward-looking statements are based on management′s current
expectations, beliefs, assumptions and estimates regarding our company,
industry, economic conditions, government regulations and energy
policies and other factors. Forward-looking statements may include, for
example, (1) our outlook for 2012 and future periods for our company,
the PRB and the industry in general, and our operational, financial and
export guidance, including any development of future terminal capacity
or increased access to existing capacity; (2) anticipated economic
conditions and demand by domestic and foreign utilities, including the
anticipated impact on demand driven by regulatory developments and
uncertainties; (3) the impact of competition from natural gas and other
alternative sources of energy used to generate electricity; (4) coal
stockpile levels and the impacts on future demand; (5) our plans to
replace and/or grow our coal tons; (6) business development and growth
initiatives; (7) operational plans for our mines; (8) our cost
management efforts; (9) industry estimates of the EIA and other third
party sources; (10) estimated Tax Receivable Agreement liabilities; and
(11) other statements regarding our plans, strategies, prospects and
expectations concerning our business, operating results, financial
condition and other matters that do not relate strictly to historical
facts. These statements are subject to significant risks, uncertainties,
and assumptions that are difficult to predict and could cause actual
results to differ materially and adversely from those expressed or
implied in the forward-looking statements. Factors that could adversely
affect our future results include, for example, (a) future economic and
weather conditions; (b) coal-fired power plant capacity and utilization,
demand for our coal by the domestic electric generation industry, export
demand and terminal capacity and the prices we receive for our coal; (c)
reductions or deferrals of purchases by major customers and our ability
to renew sales contracts; (d) competition from other coal producers,
natural gas producers and other sources of energy, domestically and
internationally, (e) environmental, health, safety, endangered species
or other legislation, regulations, treaties, court decisions or
government actions, or related third-party legal challenges or changes
in interpretations, including new requirements or uncertainties
affecting the use, demand or price for coal or imposing additional
costs, liabilities or restrictions on our mining operations or the
utility industry; (f) public perceptions, third-party legal challenges
or governmental actions and energy policies relating to concerns about
climate change, air quality or other environmental considerations,
including emissions restrictions and governmental subsidies or mandates
that make wind, solar or other alternative fuel sources more
cost-effective and competitive with coal; (g) operational, geological,
equipment, permit, labor, weather-related and other risks inherent in
surface coal mining; (h) our ability to efficiently and safely conduct
our mining operations, (i) transportation and export terminal
availability, performance and costs; (j) availability, timing of
delivery and costs of key supplies, capital equipment or commodities
such as diesel fuel, steel, explosives and tires; (k) our ability to
acquire future coal tons through the federal LBA process and necessary
surface rights and permits in a timely and cost-effective manner and the
impact of third-party legal challenges, (l) access to capital and credit
markets and availability and costs of credit, surety bonds, letters of
credit, and insurance; (m) litigation and other contingent liabilities;
and (n) other risk factors described from time to time in the reports
and registration statements we file with the Securities and Exchange
Commission ('SEC?), including those in Item 1A - Risk Factors in our
most recent Form 10-K and any updates thereto in our Forms 10-Q and
current reports on Forms 8-K. There may be other risks and uncertainties
that are not currently known to us or that we currently believe are not
material. We make forward-looking statements based on currently
available information, and we assume no obligation to, and expressly
disclaim any obligation to, update or revise publicly any
forward-looking statements made in this release or our related
presentation, whether as a result of new information, future events or
otherwise, except as required by law.
Non-GAAP Financial Measures
This release and our related presentation include the non-GAAP financial
measures of (1) Adjusted EBITDA and (2) Adjusted Earnings Per Share
('Adjusted EPS?). Adjusted EBITDA and Adjusted EPS are intended to
provide additional information only and do not have any standard meaning
prescribed by generally accepted accounting principles in the U.S., or
GAAP. A quantitative reconciliation of historical net income to Adjusted
EBITDA and EPS (as defined below) to Adjusted EPS is found in the tables
accompanying this release.
EBITDA represents net income, or income from continuing operations, as
applicable, before (1) interest income (expense) net, (2) income tax
provision, (3) depreciation and depletion, (4) amortization, and (5)
accretion. Adjusted EBITDA represents EBITDA as further adjusted to
exclude specifically identified items that management believes do not
directly reflect our core operations. The specifically identified items
are the income statement impacts, as applicable, of: (1) the Tax
Receivable Agreement including tax impacts of our 2009 initial public
offering and 2010 secondary offering, (2) our significant broker
contract that expired in the first quarter of 2010, and (3)
marked-to-market adjustments for derivative financial instruments.
Because of the inherent uncertainty related to the items identified
above, management does not believe it is able to provide a meaningful
forecast of the comparable GAAP measures or a reconciliation to any
forecasted GAAP measures.
Adjusted EPS represents diluted earnings (loss) per common share
attributable to controlling interest, or diluted earnings (loss) per
common share attributable to controlling interest from continuing
operations, as applicable ('EPS?), adjusted to exclude the estimated per
share impact of the same specifically identified items used to calculate
Adjusted EBITDA and described above.
Adjusted EBITDA is an additional tool intended to assist our management
in comparing our performance on a consistent basis for purposes of
business decision-making by removing the impact of certain items that
management believes do not directly reflect our core operations.
Adjusted EBITDA is a metric intended to assist management in evaluating
operating performance, comparing performance across periods, planning
and forecasting future business operations and helping determine levels
of operating and capital investments. Period-to-period comparisons of
Adjusted EBITDA are intended to help our management identify and assess
additional trends potentially impacting our company that may not be
shown solely by period-to-period comparisons of net income or income
from continuing operations. Adjusted EBITDA is also used as part of our
incentive compensation program for our executive officers and others.
We believe Adjusted EBITDA and Adjusted EPS are also useful to
investors, analysts and other external users of our consolidated
financial statements in evaluating our operating performance from period
to period and comparing our performance to similar operating results of
other relevant companies. Adjusted EBITDA allows investors to measure a
company′s operating performance without regard to items such as interest
expense, taxes, depreciation and depletion, amortization and accretion
and other specifically identified items that are not considered to
directly reflect our core operations. Similarly, we believe our use of
Adjusted EPS provides an appropriate measure to use in assessing our
performance across periods given that this measure provides an
adjustment for certain specifically identified significant items that
are not considered to directly reflect our core operations, the
magnitude of which may vary drastically from period to period and,
thereby, have a disproportionate effect on the earnings per share
reported for a given period.
Our management recognizes that using Adjusted EBITDA and Adjusted EPS as
performance measures has inherent limitations as compared to net income,
income from continuing operations, EPS or other GAAP financial measures,
as these non-GAAP measures exclude certain items, including items that
are recurring in nature, which may be meaningful to investors. Adjusted
EBITDA and Adjusted EPS should not be considered in isolation and do not
purport to be alternatives to net income, income from continuing
operations, EPS or other GAAP financial measures as a measure of our
operating performance. Because not all companies use identical
calculations, our presentations of Adjusted EBITDA and Adjusted EPS may
not be comparable to other similarly titled measures of other companies.
Moreover, our presentation of Adjusted EBITDA is different than EBITDA
as defined in our debt financing agreements.
CLOUD PEAK ENERGY ?INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
?
?
?
?
?
?
?
?
?
Three Months Ended
Year Ended
December 31,
?
?
?
?
December 31,
2011
?
?
?
?
?
2010
?
2011
?
?
?
?
?
2010
?
Revenues
$
402,487
?
$
345,801
?
$
1,553,661
?
$
1,370,761
?
Costs and expenses
Cost of product sold (exclusive of depreciation, depletion,
amortization and accretion, shown separately)
295,566
259,907
1,151,117
978,914
Depreciation and depletion
28,590
24,811
87,127
100,023
Amortization
?
?
?
3,197
Accretion
3,049
2,596
12,469
12,499
Selling, general and administrative expenses
13,575
16,435
52,480
63,594
Asset impairment charges
?
?
?
?
659
?
?
?
?
?
659
?
Total costs and expenses
?
340,780
?
?
304,408
?
?
1,303,193
?
?
1,158,886
?
Operating income
?
61,707
?
?
41,393
?
?
250,468
?
?
211,875
?
Other income (expense)
Interest income
133
154
592
565
Interest expense
(6,346
)
(10,752
)
(33,866
)
(46,938
)
Tax agreement expense
?
?
(19,854
)
(19,669
)
Other, net
?
2,140
?
?
34
?
?
2,105
?
?
157
?
Total other expense
?
(4,073
)
?
(10,564
)
?
(51,023
)
?
(65,885
)
Income from continuing operations before income tax
provision and earnings from unconsolidated affiliates
57,634
30,829
199,445
145,990
Income tax (expense) benefit
(13,474
)
(1,770
)
(11,449
)
(31,982
)
Earnings from unconsolidated affiliates, net of tax
?
(341
)
?
690
?
?
1,801
?
?
3,189
?
Net income
43,819
29,749
189,797
117,197
Less: Net income attributable to noncontrolling interest
?
?
?
?
16,868
?
?
?
?
?
83,460
?
Net income attributable to controlling interest
$
43,819
?
$
12,881
?
$
189,797
?
$
33,737
?
?
?
Amounts attributable to controlling interest common stockholders:
?
?
?
?
?
?
?
?
Net income
$
43,819
?
$
12,881
?
$
189,797
?
$
33,737
?
?
?
Earnings per common share attributable to controlling interest:
Basic
$
0.73
$
0.36
$
3.16
$
1.06
Diluted
$
0.72
?
$
0.36
?
$
3.13
?
$
1.06
?
Weighted-average shares outstanding - basic
?
60,007
?
?
35,713
?
?
60,004
?
?
31,889
?
Weighted-average shares outstanding - diluted
?
60,741
?
?
35,713
?
?
60,637
?
?
31,889
?
?
CLOUD PEAK ENERGY INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
?
?
?
?
?
December 31,
ASSETS
2011
?
?
?
?
2010
Current assets
Cash and cash equivalents
$
404,240
$
340,101
Restricted cash
71,245
182,072
Investments in marketable securities
75,228
?
Accounts receivable, net
95,247
65,173
Due from related parties
471
434
Inventories
71,648
64,970
Deferred income taxes
37,528
21,552
Other assets
?
15,294
?
17,449
Total current assets
770,901
691,751
?
Noncurrent assets
Property, plant and equipment, net
1,350,135
1,008,337
Goodwill
35,634
35,634
Deferred income taxes
132,828
140,985
Other assets
?
29,821
?
38,400
Total assets
$
2,319,319
$
1,915,107
LIABILITIES AND EQUITY
Current liabilities
Accounts payable
$
71,427
$
81,975
Royalties and production taxes
136,072
127,038
Accrued expenses
65,928
51,197
Current portion of tax agreement liability
19,113
18,226
Current portion of federal coal lease obligations
102,198
54,630
Other liabilities
?
4,971
?
4,880
Total current liabilities
399,709
337,946
?
Noncurrent liabilities
Tax agreement liability, net of current portion
151,523
171,885
Senior notes
596,077
595,684
Federal coal lease obligations, net of current portion
186,119
63,659
Asset retirement obligations, net of current portion
192,707
182,170
Other liabilities
?
42,795
32,564
Total liabilities
?
1,568,930
?
1,383,908
?
Equity
Common stock ($0.01 par value; 200,000 shares authorized; 60,923 and
60,878 shares
issued and outstanding at December 31, 2011 and December 31, 2010,
respectively)
609
609
Additional paid-in capital
536,301
502,952
Retained earnings
232,093
42,296
Accumulated other comprehensive loss
?
(18,614)
?
(14,658)
Total equity
?
750,389
?
531,199
Total liabilities and equity
$
2,319,319
$
1,915,107
?
CLOUD PEAK ENERGY ?INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
?
?
?
?
?
?
?
Year Ended December 31,
Cash flows from operating activities
2011
?
?
?
?
?
?
2010
?
Net income
$
189,797
$
117,197
Depreciation and depletion
87,127
100,023
Amortization
?
3,197
Accretion
12,469
12,499
Asset impairment charges
?
659
Earnings from unconsolidated affiliates
(1,801
)
(3,189
)
Distributions of income from unconsolidated affiliates
5,250
35
Deferred income taxes
(11,224
)
28,503
Tax agreement expense
19,854
19,669
Stock compensation expense
8,796
7,234
Marked-to-market adjustments
(2,275
)
?
Other, net
11,506
4,718
Changes in operating assets and liabilities:
Accounts receivable, net
(30,074
)
17,636
Inventories
(6,452
)
(638
)
Due to or from related parties
(37
)
7,906
Other assets
4,436
(10,090
)
Accounts payable and accrued expenses
26,327
27,040
Tax agreement liability
(9,409
)
(1,685
)
Asset retirement obligations
?
(7,506
)
?
(5,938
)
Net cash provided by operating activities
?
296,784
?
?
324,776
?
Investing activities
Purchases of property, plant and equipment
(142,722
)
(91,639
)
Investments in marketable securities
(75,228
)
?
Initial payment on federal coal leases
(69,407
)
?
Return of restricted cash
110,972
116,533
Restricted cash deposit
?
(218,425
)
Other
?
713
?
?
1,511
?
Net cash used in investing activities
?
(175,672
)
?
(192,020
)
Financing activities
Principal payments on federal coal leases
(54,630
)
(50,768
)
Distributions to former parent
?
(10,203
)
Other
?
(2,343
)
?
?
?
Net cash used in financing activities
?
(56,973
)
?
(60,971
)
?
Net increase in cash and cash equivalents
64,139
71,785
Cash and cash equivalents at beginning of period
?
340,101
?
?
268,316
?
Cash and cash equivalents at end of period
$
404,240
?
$
340,101
?
Supplemental cash flow
Interest paid
$
62,792
$
69,317
Income taxes paid, net
$
6,161
$
9,120
Supplemental noncash investing and financing activities
Obligations to acquire federal coal leases and other mineral rights
$
224,658
$
?
?
CLOUD PEAK ENERGY INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
(in millions, except per share data)
?
Adjusted EBITDA
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
Three Months Ended
Year Ended
December 31,
December 31,
?
2011
?
?
2010
?
?
2011
?
?
2010
?
Net income
$
43.8
?
$
29.7
?
$
189.8
?
$
117.2
?
Interest income
(0.1
)
(0.2
)
(0.6
)
(0.6
)
Interest expense
6.3
10.8
33.9
46.9
Income tax expense
13.5
1.8
11.4
32.0
Depreciation and depletion
28.6
24.8
87.1
100.0
Amortization
?
?
?
3.2
Accretion
?
3.0
?
?
2.6
?
?
12.5
?
?
?
12.5
?
EBITDA
?
95.1
?
?
69.5
?
?
334.1
?
?
311.3
?
Tax agreement expense(1)
?
?
19.9
19.7
Marked-to-market adjustments
(2.3
)
?
(2.3
)
?
Expired significant broker contract
?
?
?
?
0.1
?
?
?
?
?
(8.2
)
Adjusted EBITDA
$
92.9
?
$
69.6
?
$
351.7
?
?
322.7
?
?
(1) Changes to related deferred taxes are included in income tax
expense.
?
Due to the tabular presentation of rounded amounts, totals may
reflect insignificant rounding differences.
?
?
?
?
Adjusted EPS
?
?
?
?
?
?
?
Three Months Ended
Year Ended
December 31,
December 31,
?
2011
?
?
?
?
?
?
2010 (1)
?
?
2011
?
?
?
?
?
?
2010 (1)
?
Diluted earnings per common share
attributable to controlling interest
$
0.72
?
$
0.36
?
$
3.13
?
$
1.06
?
Tax agreement expense including tax impacts
of IPO and Secondary Offering
?
?
(0.63
)
0.78
Marked-to-market adjustments
(0.02
)
?
(0.02
)
?
Expired significant broker contract
?
?
?
?
?
?
?
?
?
(0.10
)
Adjusted EPS
$
0.70
?
$
0.36
?
$
2.47
?
$
1.74
?
Weighted-average shares outstanding (in millions)
60.7
35.7
60.6
31.9
?
(1)
In conjunction with preparing our 2011 consolidated financial
statements, we identified a clerical error in the computation of
the 2010 weighted average shares outstanding which resulted in an
understatement of earnings per share and Adjusted EPS for the
three months and twelve months ended December 31, 2010. The
previously reported earnings per share balances for the three
months and twelve months ended December 31, 2010 of $0.28 and
$0.98, respectively, have been corrected to $0.36 and $1.06,
respectively. The previously reported Adjusted EPS balances for
the three months and twelve months ended December 31, 2010 of
$0.29 and $1.62, respectively, have been corrected to $0.36 and
$1.74, respectively. This clerical error overstated the weighted
average shares outstanding balances, both basic and diluted, for
each of these periods due to the inclusion of the 60,000,000
post-Secondary Offering shares outstanding from November 15, 2010
as opposed to the correct date of December 15, 2010. The
previously reported weighted average share outstanding balances
for the three months and twelve months ended December 31, 2010 of
45.3 million shares and 34.3 million shares, respectively, have
been corrected to 35.7 million shares and 31.9 million shares,
respectively. We have assessed the impact of these adjustments and
determined that the error is immaterial to our 2010 consolidated
financial statements and does not affect our 2011 consolidated
financial statements.
?
Tons Sold
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
(in thousands)
Q4
Q3
Q2
Q1
Q4
Q3
Year
Year
?
?
2011
2011
2011
2011
2010
2010
2011
2010
Mine
Antelope
9,948
8,901
9,059
9,166
9,011
9,481
37,075
35,896
Cordero Rojo
10,070
9,968
9,225
10,193
9,223
10,272
39,456
38,500
Spring Creek
5,161
5,502
4,729
3,714
5,082
5,338
19,106
19,336
Decker (50% interest)
473
432
426
218
369
392
1,549
1,402
Total
25,652
24,803
23,439
23,291
23,685
25,483
97,186
95,134
Cloud Peak Energy Inc. Karla Kimrey, 720-566-2932 Vice
President, Investor Relations
