For the September quarter, the company reported income from continuing operations of $US24.4 million, compared to $71.3 million in the September quarter last year.
Net sales and revenues were $278.3 million, a drop year-on-year from $308.8 million, while operating income totaled $42.4 million, down $67.2 million year-on-year.
The producer said revenues and operating income were affected by significant drops in coke sales as well as realized prices that came in well below last year’s all-time highs.
"Our third-quarter performance illustrates the strong demand for our high-quality coking coal," Walter chief executive Victor Patrick said.
"We continue to see improving market conditions for our product and we are on track to achieve sales of approximately 3.5 million tons in the second half. This performance supports our plan to produce and sell approximately 8 million tons in 2010, with the start-up of the Mine No. 7 East longwall in early January 2010."
Walter’s underground mining division reported coking sales volumes for the third quarter of 1.9Mt, a record for the company, at an average selling price of $121.66/short ton free on board. In the last September quarter, 1.4Mt were sold at a mean price of $161.92/t.
The company noted that coking coal sales for the year to date were 4.7Mt, up on the same period last year, a notable feat considering global steel production is still declining.
Improved longwall performance at the No. 7 mine resulted in an overall increase in coking coal production for the company, with 1.5Mt versus 1.2Mt in 2008. The No. 4 operation produced 700,000t, slightly lower than last year, but No. 7 produced 800,000t – nearly treble the 300,000t produced in last year’s third period when a longwall move left the mine with lower volumes.
For metallurgical coal, Walter had third-quarter sales of 38,478t at an average price of $361.95/t.
Last year, it sold 101,077t at $397.20/t.
Looking ahead, Walter expects to ship 126,000t of hard coking product at 2008-09 carryover pricing, $315/t metric, in this year’s final quarter while coking coal production is anticipated to be 1.4-1.5Mt.
"We expect continued improvement in market conditions for the remainder of 2009," Patrick said.
"Moving into 2010, we are seeing increasing demand for premium mid and low-vol coals from our key product destinations, as well as Asia, with port constraints in Australia continuing to make high-quality coking coals a scarce resource."
As it kicks off the final financial quarter, Walter said it had finalized its long-range mining plan and expected to produce 8Mt of hard coking coal next year as the No. 7 longwall expansion commenced work. On the coking coal side, capacity is anticipated to increase to 8.5-9Mt in 2011 and to 9-9.5Mt in 2012.
