0000106455-95-000017.txt : 19950824 0000106455-95-000017.hdr.sgml : 19950824 ACCESSION NUMBER: 0000106455-95-000017 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19950822 ITEM INFORMATION: Other events FILED AS OF DATE: 19950823 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: WESTMORELAND COAL CO CENTRAL INDEX KEY: 0000106455 STANDARD INDUSTRIAL CLASSIFICATION: BITUMINOUS COAL & LIGNITE MINING [1220] IRS NUMBER: 231128670 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11155 FILM NUMBER: 95566129 BUSINESS ADDRESS: STREET 1: 700 THE BELLEVUE STREET 2: 200 S BROAD ST CITY: PHILADELPHIA STATE: PA ZIP: 19102 BUSINESS PHONE: 2155452500 MAIL ADDRESS: STREET 1: 700 THE BELLEVUE STREET 2: 200 S. BROAD STREET CITY: PHILADELPHIA STATE: PA ZIP: 19102 8-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): Aug. 11, 1995 Westmoreland Coal Company (Exact name of registrant as specified in its charter) Delaware 0-752 23-1128670 (State or other (Commission File (IRS Employer jurisdiction of Number) Identification No.) incorporation) 700 The Bellevue, 200 South Broad Street Philadelphia, Pennsylvania 19102 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (215) 545-2500 Item 5. Other Events. On August 11, 1995, a letter was mailed to the Company's shareholders. Item 7. Exhibits. Letter to shareholders dated August 11, 1995. Press release dated June 20, 1995. Press release dated July 21, 1995. Press release dated July 26, 1995. EXHIBIT INDEX Sequentially Exhibit Description of Exhibit Numbered Number Page 1 Letter to shareholders dated August 11, 1995 4 2 Press release dated June 20, 1995 10 3 Press release dated July 21, 1995 11 4 Press release dated July 26, 1995 19 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. WESTMORELAND COAL COMPANY Date: August 22, 1995 By:_____________________________ Theodore E. Worcester Vice President and General Counsel EX-99 2 August 11, 1995 Dear Fellow Shareholder: Continuing our policy of trying to provide you directly with timely information about Westmoreland's progress and status, I would like to update you on a number of developments since our June 6, 1995 Annual Shareholders Meeting. By the way, you should have received mailed copies of my presentation at the Shareholders Meeting. If you or anyone else you know who is interested have not, please let us know and we will get a copy off promptly. We hear that some people who hold our stock in street name have not been receiving our communications, and we want to be sure that all who are interested do get our letters. The problem, however, is a little like asking the people in the back row if they can hear you! Second Quarter Financial Results We have recently released our second quarter 1995 financial results and filed Form 10-Q. A copy of the news release which summarizes the second quarter results is attached, but let me recap certain key items for you here. Westmoreland's net loss was $10.4 million in the second quarter of 1995 compared to a net loss of $1.7 million in the second quarter of 1994. Net loss applicable to common shareholders was $11.7 million, compared to a net loss applicable to common shareholders of $2.9 million in the second quarter of last year. The difference between net loss and net loss applicable to common shareholders is the recognition of dividends payable to preferred shareholders, even if a preferred stock dividend was not declared. The Company's operating loss was $10.8 million in the second quarter, compared to an operating loss of $0.6 million in the same period in 1994, and due primarily to further significant earnings deterioration at the Virginia Operations. Coal Operations lost $13.6 million in the current period compared to an operating loss of $0.3 million in the 1994 period. These losses were offset somewhat by operating income of $2.8 million from Westmoreland Energy, Inc., our independent power subsidiary, an improvement of $3.1 million over the second quarter of 1994. Year to date results and other important information may be found in the attached second quarter news release. Coal Operations Contributing to the $13.3 million of increased losses for the Coal Operations segment was, of course, the elimination of earnings of Criterion Coal Company sold in December, 1994 and the Hampton Division sold in January, 1995 ($4.1 million of operating income in the second quarter of 1994 from the two properties). But the elimination of those earnings underscores, as we have said before, the substantial problem the Virginia Division represents for the Company and highlights the further earnings deterioration at the Virginia Division totaling $9.6 million in the second quarter (an operating loss of $8.4 million in the second quarter of 1995 compared to operating income of $1.2 million in the second quarter of 1994). This deterioration was related to higher per ton production costs, reduced sales and increased depreciation expense. These in turn were driven by worsened mining conditions, the deferral of certain above market priced shipments, and accelerated recognition of the depreciating value of the Virginia Division's assets in light of the expiration of the high priced Duke tonnage in 1996. As we stated in the Annual Report and then reiterated at the Annual Meeting, such losses cannot be tolerated, and accordingly, we had been exploring options with various parties that could allow us to preserve the remaining value of the Virginia Division's assets. In light of second quarter results, we announced on June 20, 1995 that we would idle some or all of the Virginia Division and lay off substantially all of its employees beginning August 23, 1995 while we pursued these other options. A copy of the June 20 news release announcing these layoffs pursuant to the federal WARN Act is attached. Sale of Duke Power Coal Supply Agreement On July 31, 1995 we reached an agreement with Duke Power Company whereby Duke will buy out the remaining term of the coal supply agreement which we originally entered into with them on January 1, 1986. Since Duke was the Virginia Division's sole remaining customer, we promptly idled all operations at the Division. Pursuant to the WARN Act, all affected employees will be paid through August 23, 1995, and will receive severance benefits. The Company expects to defray a significant cash portion of this severance cost by offering an Early Retirement Incentive Program to non-classified employees. Most of the cost of the Program will be funded from the non-classified employee pension plan surplus. Westmoreland will receive approximately $23 million in cash from Duke when the contract sale closes which is now expected in mid-August. Remaining Virginia Division Assets We also identified a number of parties who are interested in other Virginia Division assets. On July 31, 1995 we announced that we had entered into negotiations with A.T. Massey Coal Company, Inc., concerning the sale of the remaining assets of the Virginia Division and Pine Branch Mining Incorporated ("Pine Branch"), a small surface mining subsidiary which provided coal to the Division. These discussions are ongoing as we write this letter, and it is our hope that the discussions with A.T. Massey or others will result in a definitive agreement of sale in the near future. The benefits to the Company from the sale of the Duke Agreement and the Virginia Division assets will be the elimination of the operating losses we have endured from the operations there, the transfer of certain liabilities, and the generation of additional cash for the Company's cash needs and for reinvestment. They do not, however, resolve our heritage cost problem. More on this below. Recognition of Liabilities The idling of the Virginia Division in connection with the sale of its assets will require Westmoreland to recognize, for accounting purposes, certain liabilities. As previously discussed in the 1994 Form 10-K and Annual Report, the second quarter 1995 Form 10-Q, and in my discussion with you at the 1995 Annual Shareholders Meeting, the recognition of these liabilities will be material and may prevent the payment of preferred dividends, possibly as early as October 1, 1995. However, the total amount of the liabilities to be recognized and their impact on shareholders' equity cannot be definitively determined until, among other things, the ongoing negotiations for the sale of the remaining Virginia Division assets and Pine Branch are completed. We will continue to keep you advised regarding this issue. Liquidity We noted in the attached second quarter news release that continuing increased losses at the Virginia Division on top of the ongoing cash costs related to post-retirement medical and workers' compensation benefits had created a significant drain on the Company's operating cash. We indicated that this, coupled with the scheduled funding requirements related to the Roanoke Valley II independent power project in October and the anticipated near term sale of Cleancoal Terminal Company, could result in the Company's liquidity resources becoming inadequate to meet operating requirements through December 31, 1995. We now expect the sale of the Duke contract, the idling of the Virginia Division, and the anticipated sale of its remaining assets will resolve this issue for the near term. However, as I pointed out in detail at the Annual Meeting, the Company still faces an annual cash shortfall going forward driven by its substantial heritage costs, i.e., post-retirement medical and workers' compensation benefits. The projected shortfall has increased from $15-$20 million to $18-$23 million per year as a result of the following two new developments. Retiree Health Benefit Plan Security. We have recently been advised by the Trustees of the 1992 United Mine Workers of America Benefit Plans that pursuant to The Coal Industry Retiree Health Benefit Act of 1992 (the "Coal Act"), coal companies will be required to provide security for future payments to the UMWA Benefit Trust Fund. The Trustees have set the level of security to be provided by Westmoreland at approximately $22 million, to be provided by bond, letter of credit, or cash. The Company has elected to create a cash escrow security fund by depositing approximately $2.5 million per year for 9 years, plus an annual finance fee of 2.5% on the remaining unfunded balance. The first installment, estimated to be approximately $2.9 million, will be due in January, 1996. While this additional cash payment is a significant burden on Westmoreland, it represents the least onerous method available for funding this requirement. Increased Workers' Compensation Bond. We have also been notified by the Commonwealth of Virginia that we will be required to post an additional $750,000 of surety bonds to continue the existing self-insurance program for Virginia workers' compensation claims. These surety bonds must be obtained by September, 1995. This requirement, like the Benefit Trust Fund security requirement discussed above, places an additional cash burden on the Company. Westmoreland Energy Our independent power subsidiary, Westmoreland Energy Inc. ("WEI") continues to focus on increasing the value of existing operating projects and growing through new development opportunities. The existing projects' management are completing long-term strategic plans aimed at revenue enhancement and cost reduction. Those plans evaluate and recommend the marketing, operating and financing solutions that can maximize value during this time of change from a regulated to a competitive electrical power market. WEI is also implementing a strategy for both short and long-term growth. Of highest interest are projects where the synergy of power production can be blended with that of coal mining. Using its solid fuel expertise, WEI is developing a waste wood and waste coal facility in Illinois which could begin construction in the next few years. WEI continues to work on a long-term mine-mouth merchant plant concept. The low cost of this type of plant makes it feasible during this time of industry restructuring. On August 9, 1995 The Roanoke Valley I Partnership received a favorable decision from the Circuit Court of the City of Richmond, Virginia in the dispute between the Partnership and Virginia Power over the interpretation of the Forced Outage Day provisions in the power sales agreement between the parties. The Court denied Virginia Power's motion to dismiss the Partnership's amended complaint. This decision reversed an earlier decision in which the Court had granted a motion to dismiss an earlier complaint filed by the Partnership. This case will now proceed with pre-trial preparations. We continue to believe our position is correct and we will keep you advised of developments. Future Plans Naturally, we intend to rigorously manage both our retiree medical costs and our workers' compensation claims to minimize, wherever possible, the cash demands created by these obligations. We continue to look for new and innovative ways to do this. We are also working hard to reduce other costs and improve the performance of our solid operating assets. Relocation of a downsized corporate headquarters to less expensive and more strategic offices is one example and is on track for completion by mid-September. Most crucial, however, is the rapid acquisition of new sources of significant income. This presents a formidable challenge to the Company, comprised of identifying appropriate opportunities and then finding the capital to finance them, all on a very expedited basis. While this work has begun, it will take all our resources to achieve once the Virginia Division transactions are closed. As previously reported, we must take all these steps in the effort to generate enough cash to meet existing requirements through 1996 and beyond. It is impossible to assure you at this time that this can be accomplished, but we are doing everything we can to make it happen. Two New Directors In a related development, we were pleased to announce that the Board of Directors elected Thomas W. Ostrander and James W. Sight to the Board at its regularly scheduled meeting on July 26, 1995. Messrs. Ostrander and Sight bring skills particularly relevant to the challenges currently faced by the Company, as more fully set forth in the attached copy of the news release issued following their election. The election of Messrs. Ostrander and Sight is the initial fulfillment of the plan that we formulated in 1992 and further outlined in the 1994 Annual Report and the 1995 Proxy Statement. The plan temporarily enlarges the Board from seven to nine members and provides for a two year transition period (1995-1997) during which two of our current Directors will reach mandatory retirement age each year, and be succeeded by two additional new Directors. By the 1997 Annual Shareholders Meeting, the Board will once again have a total of seven members. We continue to value the support you have given us as we work through our strategy to turn the Company around and secure its future. While we face additional challenges, we have accomplished significant steps toward our goals. Your continued support is very important to us, and as always, we encourage you to contact us to discuss matters of interest to you regarding your Company. Sincerely, Christopher K. Seglem EX-99 3 -------------------------------------------------------------------------------- Westmoreland Announces Cutbacks; Company Seeks to Eliminate Losses in Virginia -------------------------------------------------------------------------------- Philadelphia, PA -- June 20, 1995 -- Westmoreland Coal Company (NYSE:WCX) yesterday issued notices, pursuant to the Worker Adjustment and Retraining Notification ("WARN") Act, to its employees and to the employees of its wholly owned subsidiary, Pine Branch Mining Incorporated ("Pine Branch"), working in LeeCounty and Wise County, Virginia that on August 23, 1995, it will close the Holton Low Splint Mine, which employs 25 people, and that during the fourteen day period beginning August 23, 1995, it expects to implement a further significant layoff at its other Virginia facilities. Although the notices were issued for all Westmoreland and Pine Branch employees working in Virginia, the letters of notification, which were signed by Ronald W. Stucki, Senior Vice President-Operations, also state: "The Company is working on tentative plans which could result in the retention of a reduced workforce to continue to operate certain facilities." Mr. Stucki also stated today: "During the last quarter of 1994 and the first quarter of 1995, Westmoreland lost a combined total of over $13 Million from its Virginia Division and Pine Branch operations. We are hopeful that during the next sixty days we will be able to reach an agreement, either with our employees or with a third party purchaser of our Virginia assets, on terms which will allow for the continued operation of our facilities. However, we issued these notices yesterday because we wanted to prepare our employees for certain scenarios among several alternatives which are currently under consideration and to comply with our obligations under the WARN Act. We are working hard to develop the best alternative available for Westmoreland's long-term success and to implement it promptly. We will keep our employees and the community informed of additional information on this issue, as soon as it become available." ### For information contact: R. Page Henley, Jr. (215) 545-2500 EX-99 4 ------------------------------------------------------- Westmoreland Announces Second Quarter 1995 Results ------------------------------------------------------- Philadelphia, PA -- July 21, 1995 -- Westmoreland Coal Company (NYSE:WCX) today announced its second quarter 1995 financial results. Second Quarter 1995 Financial Results Westmoreland Coal Company's net loss was $10.4 million in the second quarter of 1995 compared to a net loss of $1.7 million in the second quarter of 1994. Net loss applicable to common shareholders was $11.7 million, or a loss of $1.68 per share, in the second quarter of 1995 compared to a net loss applicable to common shareholders of $2.9 million, or a loss of $0.42 per share, in the second quarter of 1994. The difference between net loss and net loss applicable to common shareholders is the result of the recognition of dividends payable to preferred shareholders, even if a preferred stock dividend was not declared. The Company's operating loss was $10.8 million in the second quarter of 1995 compared to a $0.6 million operating loss in the same period in 1994. Operating income for the Independent Power Operations segment improved by $3.1 million ($2.8 million of operating income in the second quarter of 1995 compared to an operating loss of $0.3 million in the second quarter of 1994). The operating loss of the Coal Operations segment was $13.6 million in the current period compared to an operating loss of $0.3 million in the 1994 period. Major factors contributing to the $13.3 million of increased losses for the Coal Operations segment included (1) earnings deterioration at the Virginia Division totalling $9.6 million (an operating loss of $8.4 million in the second quarter of 1995 compared to operating income of $1.2 million in the second quarter of 1994) and (2) the elimination of earnings of Criterion Coal Company sold in December 1994 and the Hampton Division sold in January 1995 ($4.1 million of operating income in the second quarter of 1994 from both properties). The deterioration at the Virginia Division is related to reduced sales, higher per ton production costs and increased depreciation expense. Coal revenues in the second quarter of 1995 were $39.5 million from 2.0 million tons sold compared to $107.0 million from 4.3 million tons sold in the second quarter of 1994. The decrease was due to (1) the sale of the assets of Criterion Coal Company in 1994 and the Hampton Division early in 1995, (2) reduced sales by the Virginia Division and (3) a significant reduction in brokered coal sales and the elimination of export coal sales. See the attached Financial Highlights for additional information. First Half 1995 Financial Results Westmoreland Coal Company's net loss was $9.0 million in the first half of 1995 compared to a net loss of $6.5 million in the second half of 1994. Net loss applicable to common shareholders was $11.4 million, or a loss of $1.64 per share, in the first half of 1995 compared to a net loss applicable to common shareholders of $8.9 million, or a loss of $1.28 per share, in the first half of 1994. Results for the first half of 1995 included $9.5 million of gains on asset sales. The Company's operating loss was $15.1 million higher in the 1995 period than in 1994 mainly due to (1) $16.6 million of increased operating losses at the Virginia Division and (2) the elimination of earnings of Criterion Company and the Hampton Division ($6.4 million in the first half of 1994 from both properties). This was offset by $7.8 million of improvement in operating income at the Independent Power Operations segment. Coal revenues for the first half of 1995 were $80.3 million from 4.0 million of tons sold compared to $205.2 million from 8.0 million tons sold in the first half of 1994. Net cash used by operating activities was $7.7 million for the first half of 1995compared to net cash provided by operating activities of $13.0 million in the first half of 1994. See the attached Financial Highlights for additional information. Liquidity Outlook Due to the continuing losses at the Virginia Division, the ongoing cash costs related to post retirement medical and workers compensation benefits, the scheduled funding requirements related to the Roanoke Valley II independent power project and the sale of Cleancoal Terminal Company, the Company's liquidity resources would be inadequate to meet operating requirements through December 31, 1995. Accordingly, management plans to address this near-term problem by reducing costs and selling all or part of the Virginia Division's assets and/or related businesses. Christopher K. Seglem, Westmoreland's President and Chief Executive Officer, reported at the 1995 Annual Meeting on June 6, 1995, "As the core mining property, Virginia has been the key variable for the Company for many years....Further losses are not tolerable. One way or another the value of Virginia's assets must be put to work generating cash for years to come....Over the past several months we have met with employees, the United Mine Workers of America, Penn Virginia, Duke Power Company, other customers, mining contractors and other operators to determine our options, values, and the best course of action....We are now cautiously optimistic that some reasonable value can be achieved with Virginia for the near-term. We intend to move forward aggressively on this." As previously reported, the Company will be required to take additional steps, such as the acquisition of new income-producing properties, to generate enough cash to meet its requirements through 1996 and beyond. The Company, however, cannot give assurances at this time that these steps can be accomplished. Second Quarter 10-Q Filed Westmoreland today filed its second quarter Form 10-Q with the Securities and Exchange Commission. Shareholders interested in receiving a copy of the Form 10-Q can request a copy from Westmoreland Coal Company by writing to the Company at the following address: Westmoreland Coal Company, Shareholder Relations Department, 700 The Bellevue, 200 South Broad Street, Philadelphia, PA 19102. ### For information contact R. Page Henley, Jr. (215) 545-2500.
WESTMORELAND COAL COMPANY Financial Highlights - Earnings (In Thousands Except Per Share Data) Three Months Six Months Ended June 30 Ended June 30 1995 1994 (1) 1995 1994 (1) Operating income (loss) Coal Operations: Virginia Division $ (8,390) (2) $ 1,168 $ (15,920) (2) $ 673 Pine Branch Mining Incorporated (173) (501) (367) (1,681) Westmoreland Resources, Inc. 627 507 1,326 1,291 Westmoreland Coal Sales Company (621) (64) (100) 563 Net corporate expenses (2,286) (2,574) (5,618) (3) (4,832) West Virginia - Idled Operations (2,187) (2,631) (4,738) (4,906) Hampton Division - 611 - 581 Criterion Coal Company - 3,456 - 5,800 Cleancoal Terminal Company (597) (279) (701) (709) Total Coal Operations (13,627) (307) (26,118) (3,220) Independent Power Operations: Westmoreland Energy, Inc. 2,789 (4) (292) 5,239 (4) (841) WEI - recognition of deferred income - - 1,750 - Total Independent Power Operations 2,789 (292) 6,989 (841) Operating loss $ (10,838) $ (599) $ (19,129) $ (4,061) Gains on the sale of assets $ 23 $ - $ 9,538 (5) $ - Net loss $ (10,443) (1,710) $ (8,965) $ (6,498) Less preferred stock dividends: Declared 1,222 - 2,444 1,222 In arrears - 1,222 - 1,222 1,222 1,222 2,444 2,444 Net loss applicable to common shareholders $ (11,665) $ (2,932) $ (11,409) $ (8,942) Net loss per share applicable to common shareholders $ (1.68) $ (.42) $ (1.64) $ (1.28) (1) Restated to conform with current classifications and to reflect Westmoreland Energy, Inc. as a continuing operation. (2) Second quarter comparison adversely affected by higher per ton production costs, 455,000 less tons sold an $2.2 million of increased depreciation expense. First half comparison adversely affected by higher per ton production costs, 664,000 less tons sold and $ 3.8 million of increased depreciation expense. (3) Includes a $1.4 million non-cash charge for an early retirement program related to the relocation of the corporate office. (4) Second quarter and first half comparisons were positively impacted by the mid-1994 start-up of ROVA I, Rensselaer and Ft. Lupton projects (5) Includes $ 9.1 million from the sale of the Hampton Division. The above quarterly information is prepared from the accounts of the Company without audit.
Westmoreland Coal Company Financial Highlights - Coal Statistics (In Thousands) Three Months Ended Six Months Ended June 30 June 30 1995 1994 1995 1994 TONS SOLD Inland 2,029 3,860 3,974 7,090 Export - 412 - 908 Total Tons Sold 2,029 4,272 3,974 7,998 INLAND TONS SOLD Virginia Division * 794 1,249 1,657 2,321 Westmoreland Resources, Inc. 1,141 1,089 2,147 2,084 Hampton Division - 265 - 522 Criterion Coal Company - 568 - 1,044 Total Westmoreland Operations 1,935 3,171 3,804 5,971 From Unaffiliated Producers 94 689 170 1,119 Total Inland Tons Sold 2,029 3,860 3,974 7,090 EXPORT TONS SOLD Hampton Division - 94 - 143 Criterion Coal Company - 2 - 2 From Unaffiliated Producers - 316 - 763 Total Export Tons Sold - 412 - 908 TOTAL TONS SOLD 2,029 4,272 3,974 7,998 COAL SOURCES Virginia Division * 794 1,249 1,657 2,321 Westmoreland Resources, Inc. 1,141 1,089 2,147 2,084 Hampton Division - 359 - 665 Criterion Coal Company - 570 - 1,046 Total Westmoreland Operations 1,935 3,267 3,804 6,116 From Unaffiliated Producers 94 1,005 170 1,882 Total Coal Sources 2,029 4,272 3,974 7,998 Average revenue per ton sold: Eastern Operations $ 35.50 $ 31.27 $ 35.64 $ 34.41 Westmoreland Resources, Inc. 6.96 6.85 7.05 7.03 Weighted Average $ 19.45 $ 25.05 $ 20.20 $ 25.65 * Includes tons: Sold by Pine Branch Mining Incorporated 61 63 131 98 Purchased from Unaffiliated Producers 164 207 415 359 The above quarterly information is prepared from the accounts of the Company without audit.
Westmoreland Coal Company Consolidated Statements of Income (In Thousands Except Per Share Data) Three Months Ended Six Months Ended June 30 June 30 1995 1994* 1995 1994* Revenues: Coal $ 39,468 $ 107,003 $ 80,256 $ 205,163 Independent Power 3,786 1,759 8,681 2,833 43,254 108,762 88,937 207,996 Costs and expenses: Cost of coal sold 43,602 97,358 88,160 188,625 Cost of sales-Independent Power 629 684 1,007 1,311 Depreciation, depletion and amortization 5,600 4,303 10,639 8,554 Selling and administrative 4,261 7,016 8,260 13,567 54,092 109,361 108,066 212,057 Operating loss (10,838) (599) (19,129) (4,061) Gains on the sales of assets 23 - 9,538 - Interest expense (339) (1,189) (681) (2,282) Interest and other income 1,119 783 2,258 1,314 Loss before income tax expense (benefit) and minority interest (10,035) (1,005) (8,014) (5,029) Income taxes (benefit): Current 349 328 844 841 Deferred (110) 268 (247) 324 239 596 597 1,165 Minority interest 169 109 354 304 Net loss (10,443) (1,710) (8,965) (6,498) Less preferred stock dividends: declared 1,222 - 2,444 1,222 in arrears - 1,222 - 1,222 1,222 1,222 2,444 2,444 Net loss applicable to common shareholders $ (11,665) $ (2,932) $ (11,409) $ (8,942) Net loss per share applicable to common shareholders $ (1.68) $ (.42) $ (1.64) $ (1.28) Weighted average number of common shares outstanding 6,961 6,955 6,960 6,955 * Restated to reflect Westmoreland Energy, Inc. as a continuing operation. The above quarterly information is prepared from the accounts of the Company without audit.
Westmoreland Coal Company Consolidated Statements of Cash Flows (In Thousands) Six Months Ended June 30 1995 1994* Cash flows from operating activities: Net loss $ (8,965) $ (6,498) Adjustments to reconcile net loss to net cash provided (used) by operating activities: Gains on the sales of assets (9,538) - Equity earnings from independent power projects (6,076) (2,383) Recognition of development fee income (1,750) - Cash distributions from independent power projects 5,087 1,105 Depreciation, depletion and amortization 10,639 8,554 Decrease in accrual for pneumoconiosis benefits (195) (650) Decrease in notes and accounts receivables, net of allowance for doubtful accounts 9,668 14,912 Increase in inventories 2,018 2,900 Decrease in accounts payable and accrued expenses (11,557) (10,511) Increase in accrual for postretirement medical costs 3,037 3,683 Other (41) 1,908 Net cash provided (used) by operating activities (7,673) 13,020 Cash flows from investing activities: Fixed assets additions (342) (2,617) (Increase) decrease in notes receivable 1,592 (868) Proceeds from sales of assets 10,131 85 LG&E support fee payment - (3,563) Net cash provided (used) by investing activities 11,381 (6,963) Cash flows from financing activities: Hampton lease buyout premium (1,103) - Repayment of long-term debt (2,132) (6,159) Cash deposits to support surety bonds - (4,430) Dividends paid to shareholders (1,222) (3,144) Other - 4 Net cash used in financing activities (4,457) (13,729) Net increase (decrease) in cash and cash equivalents (749) (7,672) Cash and cash equivalents, beginning of period 15,453 24,262 Cash and cash equivalents, end of period $ 14,704 $ 16,590 * Restated to conform with current classifications and to reflect Westmoreland Energy, Inc. as a continuing operation. The above quarterly information is prepared from the accounts of the Company without audit.
Westmoreland Coal Company Condensed Consolidated Balance Sheets (In Thousands) June 30 Dec. 31 1995* 1994 Assets Current Assets: Cash and cash equivalents $ 14,704 $ 15,453 Receivables, net 14,380 25,329 Inventories 6,311 8,604 Assets of Cleancoal Terminal Co. held for sale 5,848 - Other current assets 890 952 Total current assets 42,133 50,338 Net property, plant and equipment 78,929 89,728 Assets of Cleancoal Terminal Co. held for sale - 6,149 Investment in Independent Power Projects 44,035 43,046 Investment in DTA 19,642 20,375 Other assets 19,790 20,103 Total assets $ 204,529 $ 229,739 Liabilities and Shareholders' Equity Current Liabilities: Current installments of long-term debt $ 11,074 $ 3,561 Accounts payable and accrued expenses 24,641 35,720 Accrual for postretirement medical costs 8,075 8,075 Preferred dividends payable 1,222 - Taxes on income 4,123 4,463 Total current liabilities 49,135 51,819 Long-term debt 2,725 12,370 Accrual for pneumoconiosis benefits 14,809 15,004 Accrual for workers' compensation 22,174 21,771 Accrual for postretirement medical costs 39,442 36,405 Other liabilities 11,789 16,613 Deferred income taxes 14,485 14,732 Minority interest 10,655 10,301 Shareholders' equity 39,315 50,724 Total liabilities and shareholders' equity $ 204,529 $ 229,739 * Prepared from the accounts of the Company without audit.
EX-99 5 ------------------------------------------------------------- Westmoreland Coal Company Elects Two New Directors -------------------------------------------------------------- Philadelphia PA - July 26, 1995 - Westmoreland Coal Company (NYSE:WCX) announced that Thomas W. Ostrander and James W. Sight were elected to its Board of Directors at the Company's regular Board Meeting today. Mr. Ostrander is a Managing Director of Salomon Brothers Inc where he oversees the Eastern Industrial Coverage Group of Salomon Brothers' Investment Bank. He was formerly associated with Kidder, Peabody & Co., Inc., from 1976 to 1989 where he held several positions including Managing Director from 1986 to 1989 when he joined Salomon Brothers. He was elected to Kidder, Peabody's Board of Directors in 1986 before it was acquired by General Electric. He began his career with Ernst & Ernst in 1972 where he served until 1975. A 1972 graduate of the University of Michigan where he received a Bachelor of Arts degree cum laude in Economics and Accounting, Mr. Ostrander received a Master of Business Administration degree With Distinction from the Harvard Business School in 1976. He and his wife and three children reside in New York City and Upper Brookville, Long Island. Mr. Sight is an active investor in public markets and shareholder of Westmoreland Coal Company. He was brought to the Company's attention by several of its largest preferred shareholders. He specializes in working closely with the management of companies in which he has invested to assist in the enhancement of shareholder value including serving as a creditor committee member and as a director of public companies engaged in turnaround efforts. He is a 1977 graduate of the Wharton School of Economics of the University of Pennsylvania. He resides in Mission, Kansas. Christopher K. Seglem, President and Chief Executive Officer of Westmoreland said, "We are very pleased that two such capable men as Tom Ostrander and Jim Sight have agreed to join Westmoreland's Board. Together they bring a wealth of skill and experience which will be of great value to the Company as it continues its efforts to restructure." Tom Ostrander's investment banking expertise will greatly assist us as we proceed to evaluate acquisition opportunities and obtain necessary financing. Jim Sight's experience with companies in work-out situations will clearly benefit all shareholders as we work to turn the Company around." For Information Contact: R. Page Henley, Jr. (215) 545-2500 f:\legal\news\newdir.doc