Westmoreland Coal (NasdaqGM: WLB) reported July 26 that its second quarter 2013 revenues grew 22.4% to $162.5m compared with $132.8m in the year-ago quarter, while adjusted EBITDA increased 119.2% to $32m compared with $14.6m in the second quarter of 2012.
Adjusted EBITDA for the twelve months ended June 30, 2013, increased to $121.2m compared with $77.5m for the twelve months ended June 30, 2012. The second quarter 2013 net loss applicable to common shareholders decreased to $0.6m from a loss of $12.4m in the year-ago quarter.
“During the second quarter, favorable weather and low hydro generation resulted in high demand for power. Our customers ran their plants at high levels and Westmoreland’s mines and plants operated very well, producing $32 million in EBITDA for the quarter. Second quarter EBITDA has historically been lower than other quarters, and we are extremely pleased with these results,” said Westmoreland CEO Robert King. “During the quarter, we also continued to successfully execute our delevering strategy, driving our net leverage ratio below 2.5.”
He added: “Unfortunately, Unit 4 at the Colstrip plant experienced a major equipment failure on July 1st and this unit is estimated to be down for at least 6 months. We anticipate that this will negatively impact our EBITDA in the second half of the year, but still expect 2013 EBITDA to fall in the range between $112 and $120 million, consistent with the guidance given last quarter. Our ability to maintain our guidance is, in part, due to the limited downside provided by our cost recovery business model.”
Colstrip is a minemouth power plant in Montana that takes coal from Westmoreland’s adjacent Rosebud strip mine. Not mentioned by Westmoreland is that a unit at a major customer power plant, the Sherburne County (Sherco) facility in Minnesota, is due back in operation in September after being offline due to mechanical problems since November 2011.
Westmoreland sold 5.7 million tons of coal in the second quarter, up from 3.9 million tons in the second three months of 2012.
Westmoreland Coal’s operations include sub-bituminous coal mining in the Powder River Basin in Montana and Wyoming, and lignite mining operations in Montana, North Dakota and Texas. Its power operations include ownership of the two-unit ROVA coal-fired power plant in North Carolina.