Arch Coal loses $70 million in first quarter
Arch Coal Inc., parent company of Utah's largest coal operator, said Tuesday it lost $70 million in the first quarter of 2013 as a sluggish global market lowered production.
The St. Louis-based company's decline amounted to 33 cents per share, compared to a year earlier when Arch Coal lost $8 million, or 4 cents a share. The bottom line was based on quarterly revenues of $826 million, down from just more than $1 billion in the first quarter of 2012.
In Utah, Arch Coal subsidiary Canyon Fuel Co. operates the Sufco, Skyline and Dugout Canyon mines. Together, they are by far the state's biggest producers, excavating more than 9 million tons of coal in 2012, according to federal Mine Safety and Health Administration figures.
That number has declined the last few years, down from 11.6 million tons in 2010 and 11 million tons in 2011. Employment at Canyon Fuel's three mines also has slipped, MSHA records show, from 860 in the first quarter of 2011 to 700 in the same period this year.
Production at the three Utah mines, along with West Elk mine in western Colorado, fell to 3.5 million tons in the year's first quarter after reaching 3.8 million in the final three months of 2012, the quarterly report said.
Still, those four mines earned the company $11.41 a ton during the first quarter of 2013, largely through cost-cutting measures such as shutting down Dugout Canyon's longwall mining machine, the report added.
Despite the red ink, Arch Coal President and CEO John Eaves said he was optimistic about future prospects.
"Despite the global coal market headwinds that have prevailed over the last 18 months, we are delivering strong cost control," he said. "We are confident our low-cost operations will generate strong cash flows and value for our shareholders."