For the period ended December 31, the company reported a net loss of $US70.1 million on $641.1 million of produced coal revenue, compared to a net income last year of $24.4 million on $498.7 million of produced coal revenue.

The producer sold 8.9 million tons in the December quarter, versus 7.8Mt a year earlier.

Massey noted that its production was affected by a significant reduction in operated shifts as well as lower productivity at its deep mines and higher ratios on surface mines. It also cited those production levels, inconsistent rail service and port delays for its drop in shipments.

"We are disappointed with our results in the fourth quarter but we remain committed to making significant improvements going forward; 2010 was a year of tremendous challenge for everyone at Massey,” president and chief executive Baxter Phillips said.

“We are working hard to make the necessary changes and adjustments to get our production back on track even as we prepare for the merger with Alpha."

Massey did realize a 12% increase in its average produced coal revenue per ton during the fourth quarter, at $71.76 compared to $64.13. The improvement was due to a 16% jump in average prices on utility coal tons as well as a 23% rise in metallurgical coal tonnage averages.

There were some areas of progress during the quarter, including the commencement of operations at Massey’s new Zigmond preparation plant in West Virginia and recommenced operations at the Sprouse Creek preparation plant.

“Continued operation of these facilities for the full year 2011 is expected to contribute to an increase in total annual production and additional metallurgical coal production,” the company said.

This quarter, the operator has added two Saturday production shifts per month at some of its operations to meet anticipated production requirements, which will be in effect until staffing delays can be resolved and productivity at its surface mines improve.

Looking ahead, the company is anticipating coal shipments of 43-47Mt, at average produced coal realizations of $81-86/t. It has 41.4Mt committed for sales in 2011, including 37.3Mt sold and priced at an average $78/t.

Sold and priced tonnage includes 6.2Mt of metallurgical coal, and Massey expects it will meet its shipment expectations of 10-14Mt this year.