Profit in the first quarter ended March 31 was $US81.1 million, a significant improvement versus the same period last year, when it totalled $28.7 million.

Revenue, meanwhile, was $699.4 million, a 22% increase from $571.3 million in the same quarter last year – a feat which the company attributed in part to higher prices.

“Our first-quarter 2008 results represent one of the best quarterly performances in Arch's history as a public entity," said Arch chairman Steven Leer.

Company president John Eaves said Arch’s mines delivered strong results during the quarter, reflecting higher price realisations and a continued focus on cost control across its key basins in the face of commodity cost pressures as well as higher sales-sensitive costs.

“The addition of the new Mountain Laurel complex to Arch's diverse asset base has been particularly significant, as evidenced by the outstanding performance in the company's Central Appalachian region during the first quarter," Eaves said.

He said the company's plans for the year include a concentrated focus on managing controllable costs, highlighting initiatives for process improvement and maximising revenue to enhance margins at its operations.

While the average sales price per ton increased by 6% in the first quarter, per-ton operating costs also jumped 4% over the same period, which Arch attributed to higher sales-sensitive costs.

Leer said the company was looking to build upon its "exceptional results" for a profitable, productive year.

“We believe Arch's national footprint, competitive asset base and access to robust global and domestic coal markets have positioned the company to earn substantial returns in 2008 and beyond," he said.

Arch officials highlighted its dedicated approach to safety and the environment across its mines by mentioning three operations which earned safety awards in the first quarter.

While two Central Appalachia mines earned Mountaineer Guardian recognition from the West Virginia Office of Miners' Health, Safety and Training, its West Elk complex received two Colorado state awards for outstanding environmental achievements last year.

“West Elk was recognised for operating more than eight years without a state environmental violation, and was honoured for its environmentally sound engineering practices as well as its contributions to the state's Pollution Prevention Program," Arch officials said.

Going forward in 2008, the producer is calling pricing conditions "robust" for both metallurgical and bituminous product, noting that they have positively impacted the domestic market.

For 2009, Arch delivery prices are up more than 35% for Central Appalachian steam coal, almost 50% for Western bituminous coal and approximately 15% for Powder River Basin product since the first of this year.

“We've been successful in locking up a substantial portion of our metallurgical and steam coal sales opportunities in Central Appalachia given the strong pricing environment," said Eaves.

“We've also strategically chosen to leave a small portion unhedged in 2008 – and substantially more unpriced in 2009, including most of our metallurgical-quality coal – to capitalise on continued pricing strength."

Overall, Leer said the company expects earnings to be record-breaking this year.

“Arch is strategically prepared to respond to evolving coal market dynamics,” he said.

“We believe our size, strategic asset base, low-cost operational profile and strong balance sheet will provide ample opportunities for the company to enhance shareholder value over the next several years."

Messey to retire

Arch senior vice-president and chief financial officer Robert Messey has announced he will retire, the company said Monday.

The producer's board of directors expects to elect vice-president of finance and accounting John Drexler to replace Messey, who is stepping down April 30.

“Bob has made a tremendous contribution to Arch's success over the years, and we are grateful for his strong and effective leadership,” said Leer.

“During Bob's tenure, Arch has generated a total return to shareholders of 1100 percent and our total market capitalisation has climbed twenty-fold from $400 million to approximately $8.4 billion."

Messey has been with the company since 2000, formerly serving as senior vice-president and chief financial officer for Sverdrup Corporation.

Drexler joined Arch in May 1998 and most recently held the position of vice-president of finance and accounting. Before Arch, the University of Missouri-Columbia graduate served as audit manager for accounting firm Ernst & Young.