For its first quarter ended March 31, the company's net income was $US57.2 million, down from $88.5 million last year, and income from continuing operations over the period was $69.5 million versus the $81.9 million it reported in the same quarter of 2007.

However, revenues jumped from $1.11 billion a year ago to $1.28 billion, a 15% rise, on sales of 61.2 million tons of coal. For the prior year, sold coal totalled 55.2Mt.

Officials for the producer said both US and Australian revenues were on the upswing, on the American side from improved pricing and as a result of a greater contribution by the country's bituminous and metallurgical operations on the Aussie end.

Average US revenues grew 16% while the Australian revenue increase of 5% was offset by lower contract prices signed last year as compared to 2006 and a greater proportional mix of export and domestic thermal coal sales.

“Peabody's strategy to expand our global platform and target high-growth, high-demand markets is delivering significantly improved performance based on very strong coal markets and recent international price settlements," said Peabody chairman Gregory Boyce.

“We believe that the outstanding global fundamentals for coal are resulting from structural changes in the supply-demand balance.

“Growing economies are being fuelled by coal and world coal expansion cannot keep pace with demand."

Peabody's outlook on worldwide demand for coal was positive.

“Global coal demand continues to set new records as coal fuels the largest and strongest developing economies,” said Boyce.

“Global coal inventories remain low, US exports are accelerating and new coal-fuelled generation is being built at a fast pace around the globe.

“As a result, we are signing agreements that will significantly increase our earnings and cash flows this year and establish a solid foundation for future years."

Stateside, Peabody officials expect that exports from the US will rise 83Mt as imports decline by an estimated 30Mt, which will double the US export level in just one year.

In the first quarter alone, it noted, it has already signed customer agreements for more export coal than the last two full years put together, and the company’s committed output will come from Peabody mine production and trading operations in eight different states over five regions.

Peabody also has plans that it said will increase throughput and positively affect costs and productivity, including:

A start-up at its 6Mt per annum El Segundo Mine in New Mexico during the second quarter that it hopes will produce as much as 10Mt by 2010;

Ongoing construction of a new blending and coal loadout facility at the North Antelope Rochelle surface mine to improve efficiency and optimise coal qualities;

Progress with a project underway with the Newcastle Coal Infrastructure Group (NCIG) during the current quarter; it was granted a 35-year government lease on Kooragang Island in the Hunter River, where dredging for two bulk vessel berths has already begun; and

An increased equity ownership, 37.5%, in Virginia's DTA coal terminal, one of America's busiest coal ports with an annual capacity of 20Mt. “The acquisition increases Peabody's total share of DTA coal terminal throughput capability to approximately 6 to 7 million tons per annum," Peabody said.

It is also looking forward to a strong production year, estimating a total 220–240Mt of coal to come from its mines paired with expected sales of 240–260Mt, including 22–24Mt out of Australia.