For the period ended March 31, the company reported revenue of $US423.3 million, an 11.2% jump over the corresponding period in 2010, and a 27.2% year-on-year increase in net income to $95.4 million.
Alliance said average coal sales prices for the period rose 9.6% to $54.08 per ton, another record, thanks to increased pricing under its contracts across all mines in the company portfolio.
The River View operation, which realized increased sold tons during the quarter, helped to drive sales volumes up to 7.5 million tons, a 2.1% increase year-on-year from 7.4Mt.
The mine’s upped production also helped production volumes, which rose 9% to a record 8.2Mt compared to 7.5Mt during the same period last year.
The jump in coal sales volumes from the River View mine in the Illinois Basin as well as into the export market from the Mettiki mining complex in northern Appalachia helped to drive forward its total volumes year-on-year.
Sequentially, there was a 2.7% drop in overall volumes because of a longwall move at the Mountain View mine in northern Appalachia as well as delayed barge shipments due to high water conditions at River View and rail transportation disruptions and delays at other operations across its working regions.
The disruptions left the company with higher coal inventories in the period, which accounted for about 430,000t of the approximately 774,000t increase over the sequential quarter.
Alliance (ARLP) anticipates the delays and obstacles will be resolved over the remainder of this year as inventories trend lower by year-end.
"Our first quarter results have ARLP on track for an eleventh consecutive year of record financial performance," company president and chief executive officer Joseph Craft III said.
Craft added the financial gains made during the first quarter were only one part of its enthusiasm – the other was its safety performance.
“During the quarter, the miners at our MC Mining complex celebrated 365 consecutive days without a single lost time accident at the Excel #3 mine, leading ARLP to an accident rate well below the industry average," he said.
In its outlook, the producer said it was continuing to see strong customer demand for its output, and that activity would be spurred by some of its big plans for the short term.
“Since the beginning of this year, we have executed new sales contracts for approximately 5.5Mt of coal to be delivered between 2011 and 2014, including 1Mt of coal for the export metallurgical market,” Craft said.
He said improved market conditions in central Appalachia would permit the company to bring back online a mining unit at its Pontiki operation that had been idled since mid-2009.
Also, ARLP’s newest operation, the Tunnel Ridge complex in West Virginia, is on track to begin longwall production early next year.
Finally, it continues to have customers interested in its Gibson South development project. Craft said the company was optimistic that the market and regulatory environments would support a move to put the Illinois Basin mine into production in the 2014 timeframe.
ARLP held steady to its production guidance of 31.6-32.6Mt, and said it has secured contractual commitments and pricing for the majority of its estimated coal sales of 32-33Mt.
The company has also received coal sales commitments of about 27.3Mt, 25.9Mt and 20Mt for 2012, 2013 and 2014 respectively, leaving approximately 3Mt open for pricing next year and 6.2Mt in each of the following two years.
“Based on results to date and current estimates, ARLP is maintaining its previously estimated ranges for 2011 revenues, excluding transportation revenues, of $1.75 to $1.85 billion … and net income $345 to $385 million,” Craft said.
“ARLP also continues to anticipate total capital expenditures during 2011 in a range of $320 to $360 million, including maintenance capital expenditures.”
