During the third quarter of 2012, Lipari Energy‘s (TSX: LIP) operations sold 311,506 tons of high quality thermal coal, a 6.5% decrease over the prior year’s quarter of 333,256 tons.
The average realized sales price per ton of coal sold in the third quarter was $74.04 per ton, a 6% increase over the prior year’s average realized price of $69.83 per ton. Overall demand for coal continues to be reduced by lower natural gas prices and a slower economy, Lipari noted in a Nov. 14 earnings statement. Lipari’s stock is listed in Canada and it has coal mining operations in eastern Kentucky.
Lipari said it has sales commitments in place for 100% of its planned 2012 production and approximately 90% of its planned 2013 production at prices averaging about $72 per ton in 2012 and $77 per ton in 2013. The company currently plans to keep production at levels to meet contracted tonnages.
Third quarter 2012 tons sold decreased by 6.5% and production decreased by 22% over third quarter 2011 to 311,506 tons and 231,902 respectively. Third quarter revenues decreased by 0.9% as a result of the decrease in tonnage sold. Lipari generated earnings before interest, taxes, depreciation, depletion and amortization (EBITDA) of $3.7m during the third quarter of 2012. Adjusted EBITDA, after accounting for a change in the fair value of warrants, lease expenses and other adjustments, was $4.7m during the third quarter of 2012.
“We are cautious yet optimistic about our third quarter results, as our tons sold increased by 25% and our EBITDA increased by $1.6 million over the second quarter of 2012. We are continuing to plan our production around demand in an effort to maintain a higher working capital,” said John Liperote, CEO of Lipari Energy.
The company operates mines through subsidiary B & W Resources. Those mines include Chavies, a surface, contour and auger operation located in Leslie and Perry counties, Ky., and Owls Nest, a surface and contour mining operation in Leslie County.