TECO Energy (NYSE:TE) said Oct. 31 that its TECO Coal unit, which mines primarily in eastern Kentucky, had a third-quarter loss of $1.4m on sales of 1.5 million tons.
That is compared with net income of $17.4m on sales of 1.9 million tons in the same period in 2012.
In 2013, third-quarter results reflect an average net per-ton selling price, excluding transportation allowances, of $82 per ton, compared to $96 per ton in 2012. In the third quarter of 2013, the all-in total per-ton cost of sales was $84 per ton, within the full-year guidance range and lower than in prior quarters. The cost of sales in September was below the full-year 2013 cost guidance range.
TECO Coal recorded year-to-date 2013 net income of $2.3m on sales of 4.2 million tons, compared with $39.4m on sales of 4.9 million tons in the 2012 period. The 2013 year-to-date average net per-ton selling price was $85 per ton, compared with $96 per ton in 2012. The all-in total per-ton cost of sales was $85 per ton, which was essentially unchanged from 2012.
The cost of sales in the first quarter of 2013 included some higher-cost tons from December inventory that included costs associated with personnel reductions and with idling certain mining operations.
TECO Coal has 95% of its expected sales of between 5.2 million and 5.7 million tons contracted for 2013. The unsold tons are primarily high-vol A coal, which are forecast to be sold in the fourth quarter, but at lower prices than previously expected. On an operating basis, TECO Coal expects full-year results to be significantly lower than previously expected. Operating results are expected to be break-even in the fourth quarter, but financial results are expected to reflect additional tax benefits in the fourth quarter.