For the period ended March 31, 2012, the company reported net income of $US172.7 million, a decrease of a little more than 2% from $176.5 million reported during the same period last year.

At the same time, revenues rose 17% in the quarter to $2.04 billion, primarily driven by a 27% rise in Australian revenues per tonne, as well as a 7% improvement in US per-tonne revenues.

Overall, sales volumes totalled 61.7 million tonnes, up from 61.2Mt during the same period in 2011.

In Australia, the producer said its revenues climbed 48% on higher realised pricing for both metallurgical and thermal product and an 18% increase in sales volumes.

Shipments from the country were 6.6Mt, breaking down to 2.9Mt met and 2.6Mt seaborne steam.

Domestically, revenues were up 5% from higher realised prices in the Midwestern and Western regions.

US shipments stayed mostly steady last year because Peabody shipped only output committed by contracts.

“Peabody delivered increased contributions from both Australian and US mining operations,” chairman and chief executive Gregory Boyce said.

“Our operations contributed higher revenues and margins per tonne in all regions, demonstrating the strength of our diverse platform in the face of challenging conditions.

“Looking forward, our US coal position remains fully priced for 2012, Australian thermal coal demand remains strong and recent data suggest that metallurgical coal markets have stabilised with upside potential in the second half.”

Due to near-term market projections, Boyce also noted that Asia’s economic growth and coal consumption were both on the rise and China’s coal imports in particular were running at a record pace.

As a result, Peabody is estimating a 10% rise in seaborne demand this year as new global generation comes online.

“Lower US coal-fueled generation related to mild weather and coal-to-gas switching has reduced US coal demand,” Boyce said.

“During March, industry shipment reductions accelerated after a number of industry production curtailments were announced – additional reductions are likely.

“Peabody is negotiating with select customers regarding reduced 2012 shipments and is lowering planned US production.”

As it moves ahead, Peabody officials feel it is well positioned with sustained Australian coal production increases as well as its place as a leader in low-cost US regions.

Looking at the remainder of 2012 from a sales perspective, Peabody officials said its thermal contracts in Newcastle were settled at $115 per tonne for April 1 settlements, about 15% from record levels.

Met prices for high-quality hard coking and low-volatility pulverised coal injection coal are being settled at a respective $210 and $153 per tonne for its April 1 quarterly contracts.

In Australia, second-quarter metallurgical coal shipment settlements are in line and essentially all met production remains unpriced for the balance of the year.

It retained its target of 14-15Mt of met coal sales.

The US, stifled by coal consumption and production slumps, saw sharp declines in domestic coal-fuelled generation because many facilities were switching to gas, while a mild winter and low economic growth compounded the problem.

First-quarter US coal shipments declined an estimated 7% and reductions accelerated throughout the quarter to about 13% in March – or more than 140Mt on an annualised basis.

Peabody dropped its target sales volumes for the US to between 185Mt and 195Mt, with production fully priced – about 40-50% of planned 2013 production remained unpriced.

The company held to its sales targets for Australia for 2012, though it cut back on its US expectations.

Australia is still expected to sell between 33Mt and 36Mt, while it is now projecting volume targets of 185-195Mt for the US.

Its total sales goal is now 235-255Mt.

In a Wednesday morning earnings call, Boyce alluded to the continued issues with the US market and said the company talked with some customers with “fairly healthy stockpiles” about moving 2012 shipments to next year or even 2014.

“We’ve had some commercial discussions around rescheduling those shipments,” he said.

“There is the potential that we’ll see some continued decrease in coal demand for the rest of the year, which will require potentially some additional reductions across the industry.”