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Risk Concentrations
12 Months Ended
Dec. 31, 2018
Risks and Uncertainties [Abstract]  
Risk Concentrations
Risk Concentrations
Credit Risk and Major Customers
The Company has a formal written credit policy that establishes procedures to determine creditworthiness and credit limits for trade customers and counterparties in the over-the-counter coal market. Generally, credit is extended based on an evaluation of the customer’s financial condition. Collateral is not generally required, unless credit cannot be established. Credit losses are provided for in the financial statements and historically have been minimal.
The Company markets its steam coal principally to domestic and foreign electric utilities and its metallurgical coal to domestic and foreign steel producers. As of December 31, 2018 and 2017, accounts receivable from electric utilities of $73.9 million and $72.9 million, respectively, represented 37% and 42% of total trade receivables at each date. As of December 31, 2018 and 2017, accounts receivable from sales of metallurgical-quality coal of $126.5 million and $99.4 million, respectively, represented 63% and 58% of total trade receivables at each date.
The Company uses shipping destination as the basis for attributing revenue to individual countries. Because title may transfer on brokered transactions at a point that does not reflect the end usage point, they are reflected as exports, and attributed to an end delivery point if that knowledge is known to the Company. The Company’s foreign revenues by geographical location are as follows:
 
Successor
Predecessor
 
Year Ended December 31, 2018
 
Year Ended December 31, 2017
 
October 2 through December 31, 2016
January 1 through October 1, 2016
(In thousands)
 
 
 
 
 
 
Europe
$
559,165

 
$
388,926

 
$
61,169

$
112,986

Asia
452,711

 
264,503

 
55,634

68,536

Central and South America
79,085

 
30,982

 
13,224

41,861

Africa
17,567

 
14,901

 


Brokered Sales
2,372

 
3,150

 


Total
$
1,110,900

 
$
702,462

 
$
130,027

$
223,383


The Company is committed under long-term contracts to supply steam coal that meets certain quality requirements at specified prices. These prices are generally adjusted based on market indices. Quantities sold under some of these contracts may vary from year to year within certain limits at the option of the customer based on their requirements. The Company sold approximately 96.6 million tons of coal in 2018. Approximately 60% of this tonnage (representing approximately 47% of the Company’s revenues) was sold under long-term contracts (contracts having a term of greater than one year). Long-term contracts range in remaining life from one to four years.
Third-party sources of coal
The Company purchases coal from third parties that it sells to customers. Factors beyond the Company’s control could affect the availability of coal purchased by the Company. Disruptions in the quantities of coal purchased by the Company could impair its ability to fill customer orders or require it to purchase coal from other sources at prevailing market prices in order to satisfy those orders.
Transportation
The Company depends upon barge, rail, truck and belt transportation systems to deliver coal to its customers. Disruption of these transportation services due to weather-related problems, mechanical difficulties, strikes, lockouts, bottlenecks, and other events could temporarily impair the Company’s ability to supply coal to its customers. In the past, disruptions in rail service have resulted in missed shipments and production interruptions.