Revenue from the company’s US Coal Mining segment came in at about $151 million, as compared to $133 million in 2Q15 and $155 million in 1Q16. Revenue from company’s Canadian Coal Mining segment increased both on a YoY (year-over-year) and QoQ (quarter-over-quarter) basis in 2Q16. WLB reported its Canadian Coal Mining segment’s revenue at $109 million in 2Q16, as compared to $106 million in 2Q15 and $93 million in 1Q16.
The company’s Coal-WMLP segment witnessed a major decline in 2Q16, from $97 million in 2Q15 to $80 million. Revenue from the Power Generation segment marginally increased to about $22 million from $21 million in 2Q15. However, they remained nearly unchanged on a QoQ basis.
For 2Q16, Westmoreland Coal reported consolidated revenue of about $356 million, as compared to the analyst expectation of $353 million. The reported revenue is about 2% higher than the company’s 2Q15 revenue of $349 million.
Why the deviation?
Despite the fall in overall coal shipments, the increase in realized revenue per ton of coal sold helped Westmoreland Coal beat analyst revenue estimates for 2Q16. The company’s San Juan acquisition added about $50 million revenue in 2Q16.
Revenue realized per ton sold from the company’s US Coal Mining segment saw a significant increase, from $25.02 per ton sold in 2Q15 to $32.22 per ton sold in 2Q16. The company’s Canadian coal mining segment’s revenue per ton sold came in at $19.48, as compared to $17.99 in 2Q15. The WMLP segment witnessed a marginal increase YoY and QoQ.
Notably, low natural gas prices, subsidized renewable energy generation, mild weather conditions, and stringent environmental regulations continue to impact the revenues of pure-play coal (KOL) producers like Cloud Peak Energy (CLD), Peabody Energy (BTUUQ), and Alpha Natural Resources (ANRZQ).
Next, we’ll look at WLB’s 2Q16 operating performance.