Westmoreland results reported for two related coal companies

Westmoreland Coal (NasdaqGM: WLB) said April 24 that its net loss for the first quarter of this year was $11.7 million versus $19.3 million in the same quarter in 2014.

Revenues for the first quarter were $371.5 million versus $180.2 million in the same quarter in 2014. Adjusted EBITDA for the first quarter of 2015 was $56.0 million, while Adjusted EBITDA for the first quarter of 2014 was $28.9 million. Adjusted EBITDA for this quarter included results of the Canadian, WMLP and Buckingham operations, which were not present during the first quarter of 2014.

“We are pleased with the results of the first quarter,” said Keith E. Alessi, Westmoreland CEO. “Our larger, diversified footprint paid off as the results for the quarter matched up with internal expectations. While it was a weak quarter for the power segment, we made up for it elsewhere. During the quarter we successfully integrated both the Oxford and Buckingham operations and I appreciate the efforts of all our new associates as they embraced the Westmoreland culture.

“We are also pleased to announce that one of our subsidiaries, Westmoreland Resources, Inc., has reached a new collective bargaining agreement with the International Union of Operating Engineers, Local 400. Negotiations began on February 23, 2015 and concluded on April 10, 2015 after which the first ever six-year agreement was ratified by the majority of the Union members on April 17, 2015. This historic agreement will remain in effect until May 31, 2021. The mutually beneficial agreement was voted on by over 89% of the Union members and it passed by a significant margin.”

Westmoreland Coal’s U.S. operations sold 6.9 million tons of coal in the first quarter, against 6.8 million tons in the year-ago quarter. The Canadian coal mines, that mostly serve captive power plants, sold 5.5 million tons in the first quarter, with no comparative figure from last year due to the timing of the acquisition of these former Sherritt International operations.

Westmoreland Coal is the oldest independent coal company in the United States. Westmoreland’s coal operations include sub-bituminous and lignite surface coal mining in the Western United States and Canada, an underground bituminous coal mine (Buckingham) in Ohio, a char production facility, and a 50% interest in an activated carbon plant. Westmoreland also owns the general partner of and a majority interest in Westmoreland Resource Partners LP, formerly Oxford Resource Partners LP, a publicly-traded coal master limited partnership with surface mines in Ohio. Westmoreland Coal’s power operations include ownership of the two-unit ROVA coal-fired power plant in North Carolina.

Westmoreland Resource Partners LP (NYSE: WMLP) on April 24 also reported its first quarter results. “In this, our first quarter of ownership of WMLP, we began transitioning the business on to Westmoreland’s systems,” noted Alessi. “We are operating the business with an emphasis on Distributable Cash Flow and it performed in line with our expectations.”

WMLP reported total revenues of $67.6 million for the three months ended March 31, 2015 compared to $78.0 million for the three months ended March 31, 2014. The decrease of $10.4 million was principally due to decreased sales and production volumes, which declined to 1.1 million tons sold and produced in the first quarter of 2015 compared to 1.4 million tons sold and produced in the year-ago quarter. The decrease in tons sold and produced resulted from a decrease in market demand. It reported a net loss of $10.3 million for the first quarter.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.