Peabody Energy BTU today provided
comments on factors affecting first quarter and selected full year 2013
targets, following initial first quarter seaborne metallurgical coal pricing
settlements.
Compared with average quarterly year-to-date 2012 levels, first quarter 2013
results are expected to be impacted by:
o An increase in Australian unit costs of approximately 10 percent. Several
factors will affect first quarter targets, including the timing of
additional overburden removal at the Eaglefield and Wilpinjong mines that
impacts both production and costs; startup costs associated with the
transition to owner-operator status at the Wilpinjong and Millennium
mines; and a larger proportion of higher-cost metallurgical coal;
o Lower realized metallurgical coal pricing compared with the fourth quarter
of 2012;
o A decline of approximately 2 million tons in U.S. sales based on
market-related demand, as well as a decrease of approximately 5 percent in
average realized pricing due to the expiration of higher-priced contracts;
and
o Higher depreciation, depletion and amortization expenses as recently
completed capital projects fully begin operations and production increases
from higher-cost reserves acquired in recent years.
The company expects the first quarter to mark trough earnings, with results
expected to increase as the year proceeds based on improving Australian
production and margins.
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