Also hampering the company’s performance were $8.8 million of non-recurring costs.
Had these not occurred, the company’s Q1 2012 loss would have been $7 million – still up considerably on the $1.8 million loss the company suffered in Q1 2011.
Earnings before interest, tax, depreciation and amortization were also down year-on-year, $11 million for Q1 2012 as opposed to $14 million for Q1 2011.
EBITDA was hit by a $4.88 per ton increase in the cost of coal sales, attributable to $3.8 million in higher diesel costs.
Distributable cash flow for the quarter was $100,000 for the quarter, down $5.4 million on Q1 2011 due to the impact of a cancelled sales contract, the higher diesel costs and $800,000 in higher cash interest expenses.
The company finished the quarter with $10.5 million in the bank.
In April, the company sold oil and gas mineral rights on about 1250 acres for $6.3 million.
As part of the deal it retained royalty rights equivalent to a 20% net revenue interest once the wells were producing.
Oxford’s core northern Appalachian business remains strong, with the company retaining its position as a leading supplier of low-cost steaming coal in the region.
It is the Illinois Basin that is proving problematic.
Oxford idled two mines in the basin and significantly reduced operations at another.
The company is in the process of closing the two idled mines, which is expected to occur by the end of the year.
Separately to its quarterly statement, Oxford also announced it would incur an extra $1.2 million throughout 2012 as part of its Illinois Basin restructuring activities.
The company is transferring 22 major pieces of equipment from its Illinois Basin mines to its northern Appalachian operations, which is expected to boost productivity and reduce its capital expenditure in the northern Appalachian region by $10 million through 2012.
Oxford also expects to reap $10-15 million from the sale of excess Illinois Basin gear.
With the returns from the mineral rights sale, the equipment sales, the $10 million in expected capital expenditure saving and the $3.5 million from reduced first-quarter subordinated distribution, Oxford expects to “enhance its liquidity by $30-35 million in 2012”
