Arch Coal Posts Lower 1st-Quarter Profit on Lower Coal Prices, Higher Operating Costsadmin
Arch Coal Inc. said Monday its first-quarter profit tumbled 53 percent because of soft conditions in the U.S. coal markets.
After the payment of preferred dividends, Arch Coal earned $28.7 million, or 20 cents per share, compared with $60.6 million, or 42 cents per share, for the same quarter in 2006.
Coal sales fell 10 percent to $571.3 million from $634.6 million in the year-ago period.
Analysts polled by Thomson Financial had expected a profit of 15 cents per share on $575.6 million in revenue.
Company officials said coal market conditions were considerably less favorable in the first quarter of 2007 than in the year-ago period.
Average price realization of coal fell 68 cents per ton, reflecting weaker conditions in U.S. coal markets from the year-ago period, while operating cost rose 86 cents per ton.
Arch said the increase in operating cost per ton was a result of its decision to reduce production volume targets, weather-related shipment challenges during the quarter, and higher depreciation, depletion and amortization expense.
Information from: AP via biz.yahoo.com