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Alpha Natural Resources: 2Q15 Revenue and Shipment Expectations

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2Q15 expectations

Wall Street analysts expect Alpha Natural Resources (ANRZ) to post about $844 million in revenues in 2Q15. This number falls considerably short of the $1.05 billion that the company posted in 2Q14. We’ll review the company’s 1Q15 revenue and shipments performance to give you an idea of what to expect in 2Q15.

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Steam coal

In 1Q15, ANRZ sold 10 million tons of PRB (Powder River Basin) coal. PRB coal (KOL) shipments topped 1Q14’s 9.4 million tons and 4Q14’s 9.8 million tons. However, the average price per ton dropped to $11.55, down from $12.26 in 1Q14 and $12.02 in 4Q14. Due to weaker pricing, overall revenues from ANRZ’s PRB segment fell to $115.7 million in 1Q15, down from $115.8 million in 1Q14 and $118.2 million in 4Q14, despite higher shipments. Peabody Energy (BTU) and Cloud Peak Energy (CLD) also operate in the PRB.

ANRZ’s Eastern Steam coal (Central Appalachian) shipments dropped substantially to 5.5 million tons in 1Q15, down from 7.6 million tons in 1Q14 and 7.3 million tons in 4Q14. The price per ton dropped to $55.20 in 1Q15, down from $58.25 in 1Q14 and $55.47 in 4Q14. Overall, the segment reported $309.3 million in revenues in 1Q15, down from 1Q14’s $441.9 million and 4Q14’s $402.5 million. Consol Energy (CNX) and Arch Coal (ACI) also operate in Appalachia.

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Metallurgical coal

The company sold 4 million tons of metallurgical (ACI) coal in 1Q15, down from 4.4 million tons in 1Q14 and 4.9 million tons in 4Q14. The price per ton dropped to $76.75 in 1Q15, down from $89.99 in 1Q14 and $83.43 in 4Q14. Overall, the segment reported $309.3 million in revenues in 1Q15 compared to $395.2 million in 1Q14 and $410.9 million in 4Q14.

Overall performance

Overall, the company sold 19.5 million tons of coal in 1Q15 at an average price of $37.23 (1Q14: $44.48) per ton, clocking $726.1 million ($953 million) in coal revenues.

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