Segment Information

9 Months Ended

Sep. 30, 2022

Segment Information

Segment Information

15. Segment Information

The Company’s reportable business segments are based on two distinct lines of business, metallurgical and thermal, and may include a number of mine complexes. The Company manages its coal sales by market, not by individual mining complex. Geology, coal transportation routes to customers, and regulatory environments also have a significant impact on the Company’s marketing and operations management. Mining operations are evaluated based on Adjusted EBITDA, per-ton cash operating costs (defined as including all mining costs except depreciation, depletion, amortization, accretion on asset retirement obligations, and pass-through transportation expenses, divided by segment tons sold), and on other non-financial measures, such as safety and environmental performance. Adjusted EBITDA is not a measure of financial performance in accordance with generally accepted accounting principles, and items excluded from Adjusted EBITDA are significant in understanding and assessing the Company’s financial condition. Therefore, Adjusted EBITDA should not be considered in isolation, nor as an alternative to net income, income from operations, cash flows from operations or as a measure of our profitability, liquidity or performance under generally accepted accounting principles. The Company uses Adjusted EBITDA to measure the operating performance of its segments and allocate resources to the segments. Furthermore, analogous measures are used by industry analysts and investors to evaluate the Company’s operating performance. Investors should be aware that the Company’s presentation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. The Company reports its results of operations primarily through the following reportable segments: Metallurgical (MET) segment, containing the Company’s metallurgical operations in West Virginia, and the Thermal segment containing the Company’s thermal operations in Wyoming and Colorado.

Reporting segment results for the three and nine months ended September 30, 2022 and 2021 are presented below. The Corporate, Other, and Eliminations grouping includes these charges: idle operations; change in fair value of coal derivatives and coal trading activities, net; corporate overhead; land management activities; other support functions; and the elimination of intercompany transactions.

					Corporate,
					Other and
(In thousands)	MET		Thermal		Eliminations		Consolidated
Three Months Ended September 30, 2022
Revenues	$	444,306	$	419,529	$	—	$	863,835
Adjusted EBITDA		155,185		96,812		(29,041)		222,956
Depreciation, depletion and amortization		28,354		5,388		216		33,958
Accretion on asset retirement obligation		553		3,444		433		4,430
Total assets		1,020,849		325,580		973,433		2,319,862
Capital expenditures		36,389		4,604		367		41,360
Three Months Ended September 30, 2021
Revenues	$	295,291	$	299,096	$	25	$	594,412
Adjusted EBITDA		118,548		52,737		(39,690)		131,595
Depreciation, depletion and amortization		25,041		5,488		231		30,760
Accretion on asset retirement obligation		508		4,419		510		5,437
Total assets		965,252		193,060		772,637		1,930,949
Capital expenditures		61,504		507		2,078		64,089
Nine Months Ended September 30, 2022
Revenues	$	1,640,970	$	1,224,159	$	—	$	2,865,129
Adjusted EBITDA		810,615		290,648		(97,357)		1,003,906
Depreciation, depletion and amortization		82,738		15,554		656		98,948
Accretion on asset retirement obligation		1,660		10,331		1,299		13,290
Total assets		1,020,849		325,580		973,433		2,319,862
Capital expenditures		79,896		13,200		1,421		94,517
Nine Months Ended September 30, 2021
Revenues	$	693,522	$	707,394	$	1,429	$	1,402,345
Adjusted EBITDA		221,391		107,589		(99,962)		229,018
Depreciation, depletion and amortization		68,577		15,170		694		84,441
Accretion on asset retirement obligation		1,523		13,256		1,532		16,311
Total assets		965,252		193,060		772,637		1,930,949
Capital expenditures		204,347		1,370		6,329		212,046

A reconciliation of net income to adjusted EBITDA and segment Adjusted EBITDA from coal operations follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(In thousands)	2022		2021		2022		2021
Net income	$	181,007	$	89,143	$	860,443	$	110,967
Provision for (benefit from) income taxes		474		(1,082)		1,424		1,301
Interest expense, net		1,836		6,151		13,469		12,746
Depreciation, depletion and amortization		33,958		30,760		98,948		84,441
Accretion on asset retirement obligations		4,430		5,437		13,290		16,311
Non-service related pension and postretirement benefit costs		857		1,186		2,189		3,252
Net loss resulting from early retirement of debt		394		—		14,143		—
Adjusted EBITDA	$	222,956	$	131,595	$	1,003,906	$	229,018
EBITDA from idled or otherwise disposed operations		3,624		3,074		9,972		10,637
Selling, general and administrative expenses		26,107		21,081		79,271		66,679
Other		(690)		15,535		8,114		22,646
Segment Adjusted EBITDA from coal operations	$	251,997	$	171,285	$	1,101,263	$	328,980