-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UQo8VgElbQ1avLSVeJH3h0bl8A0CzQ/QoWl07Y89l49v4scV38Gs3KQzgbubZT69 CWiEsA7ovPv+36tzjbXhfw== 0000950129-04-002312.txt : 20040423 0000950129-04-002312.hdr.sgml : 20040423 20040423160024 ACCESSION NUMBER: 0000950129-04-002312 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040423 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040423 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLIANCE RESOURCE PARTNERS LP CENTRAL INDEX KEY: 0001086600 STANDARD INDUSTRIAL CLASSIFICATION: BITUMINOUS COAL & LIGNITE SURFACE MINING [1221] IRS NUMBER: 731564280 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-26823 FILM NUMBER: 04751191 BUSINESS ADDRESS: STREET 1: 1717 SOUTH BOULDER AVENUE CITY: TULSA STATE: OK ZIP: 74119 BUSINESS PHONE: 9182957600 8-K 1 h14710e8vk.txt ALLIANCE RESOURCE PARTNERS, L.P. UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 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): April 23, 2004 COMMISSION FILE NO.: 0-26823 ALLIANCE RESOURCE PARTNERS, L.P. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE (STATE OR OTHER JURISDICTION OF 73-1564280 INCORPORATION OR ORGANIZATION) (IRS EMPLOYER IDENTIFICATION NO.) 1717 SOUTH BOULDER AVENUE, SUITE 600, TULSA, OKLAHOMA 74119 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE) (918) 295-7600 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (c) EXHIBITS 99.1 Alliance Resource Partners, L.P. press release dated as of April 23, 2004. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. In accordance with General Instruction B.2. of Form 8-K, the following information and the exhibits referenced therein is being furnished under Item 12 of Form 8-K and is not deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, is not subject to the liabilities of that section and is not deemed incorporated by reference in any filing under the Securities Act of 1933, as amended. On April 23, 2004, Alliance Resource Partners, L.P. (the "Partnership") announced via press release its earnings and operating results for the first quarter of 2004. A copy of the Partnership's press release is attached hereto as Exhibit 99.1. 2 SIGNATURES 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. ALLIANCE RESOURCE PARTNERS, L.P. By: Alliance Resource Management GP, LLC, its managing general partner By: /s/ Joseph W. Craft III ------------------------------------- Joseph W. Craft III President and Chief Executive Officer Date: April 23, 2004 3 EXHIBIT INDEX Exhibit Number Description - ------- ----------- *99.1 Alliance Resource Partners, L.P. press release dated as of April 23, 2004. - ------------------- * Filed herewith. EX-99.1 3 h14710exv99w1.txt PRESS RELEASE DATED APRIL 23, 2004 Exhibit 99.1 PRESS RELEASE CONTACT: BRIAN L. CANTRELL Alliance Resource Partners, L.P. 1717 South Boulder Avenue, Suite 600 (ALLIANCE RESOURCE PARTNERS, L.P. LOGO) Tulsa, Oklahoma 74119 (918) 295-7673 FOR IMMEDIATE RELEASE ALLIANCE RESOURCE PARTNERS, L.P. ANNOUNCES RECORD QUARTERLY NET INCOME; RAISES QUARTERLY CASH DISTRIBUTION BY 11% TO $0.625 PER UNIT; AND INCREASES GUIDANCE TULSA, Oklahoma, April 23, 2004 - Alliance Resource Partners, L.P. (NASDAQ: ARLP) today reported record net income for the first quarter ended March 31, 2004 of $18.2 million, or $1.00 per basic limited partner unit, an increase of approximately 39% over 2003 first quarter net income of $13.1 million, or $0.81 per basic limited partner unit. Net income per basic limited partner unit is calculated using the weighted average number of basic units outstanding of 17,903,793 and 16,593,609 for the quarters ended March 31, 2004 and 2003, respectively, both of which reflect our common unit offerings completed in the first quarter of 2003. Income before income taxes for the quarter improved 35% to a record $19.0 million, compared to $14.1 million for the same quarter of 2003. The Partnership also announced that its Board of Directors declared a quarterly cash distribution of $0.625 per unit for the first quarter ended March 31, 2004 (an annualized rate of $2.50 per unit), payable on May 14, 2004, to all unitholders of record as of May 3, 2004. This represents an increase of 11% over the cash distribution for the fourth quarter of 2003 of $0.5625 per unit (an annualized rate of $2.25 per unit) and a 25% increase since 2002. "We achieved record revenues, tons produced and net income for the quarter due to favorable market conditions which allowed us to benefit from higher prices, increase production and secure additional sales," said Joseph W. Craft III, President and Chief Executive Officer. "These results and market conditions have allowed us to increase our distribution to unitholders for the second consecutive quarter in advance of our normal mid-year review. Going forward, we expect to consider future distribution increases at the January and July Board of Directors' meetings." Revenues for the 2004 first quarter were $157.8 million, an increase of approximately 26% over revenues of $124.9 million for the comparable period last year. Revenues for the first quarter of 2004 were positively impacted by the increase in tons of coal sold and higher contract prices on long-term coal sales agreements. In addition, our revenues in the 2004 first quarter benefited significantly from higher sales prices realized on incremental production sold into the export and Central Appalachia coal markets. Production increased to 5.1 million tons for the first quarter of 2004 as compared to 5.0 million for the comparable period in 2003, primarily due to higher productivity at our Warrior Coal, Gibson County Coal and East Kentucky operations. These increases were partially offset by reduced production at our idled Hopkins County Coal operation (See ARLP Press Releases, dated April 3 and June 2, 2003) and the impact of the Dotiki mine fire earlier this year. -MORE- Results for the first quarter of this year were achieved despite lost production, continuing fixed expenses and other expenses incurred as a result of the mine fire that occurred at the Dotiki mine, operated by our Webster County Coal, LLC subsidiary. (See ARLP Press Releases, dated February 12, March 1, March 8, and March 25, 2004.) We maintain commercial property insurance policies which we believe will substantially cover the expenses and losses relating to the fire. For the first quarter of 2004, we have recognized a $2.9 million receivable under the insurance policies reflecting a partial recovery of certain fire-related expenses, net of a $3.5 million self-retention and deductible and 10% coinsurance. We continue to analyze the full extent of expenses and losses (including business interruption) pertaining to the fire. Until our analysis is complete, however, it is premature to quantify the total impact of the Dotiki mine fire incident on the financial results of Alliance. Total operating expenses increased to $104.3 million for this quarter as compared to $82.8 million for the first quarter of last year. The increase was primarily due to higher costs due to increased production, increased sales related expenses, and net expenses related to the Dotiki mine fire. Operating expenses for the 2004 quarter were $0.38 per ton sold below expectation for all operations, excluding Dotiki. General and administrative expenses also increased in the first quarter of this year by $4.6 million to $10.3 million as compared to $5.7 million during the same period of 2003, primarily as a result of increased incentive compensation expense. This expense increase was principally attributable to the Long-Term Incentive Plan and was caused by the increased market value of our common units, which closed at $40.00 per unit on March 31, 2004. In response to robust market conditions as well as a supply shortage in the markets served by our Mettiki mine, we have signed two separate agreements with contract mining companies to produce coal on reserves we control near the Mettiki complex. We expect both of these operations to begin production in June 2004 and will add annual production of approximately 625,000 tons. To further increase production during the second half of 2004, we will also add equipment at our Gibson County Coal and Pattiki mines. We are estimating additional 2004 capital expenditures of approximately $5.1 million for these contract mining and equipment projects. As a result of these projects and accelerated production schedules at certain other operations, we are now estimating 2004 production at 20.6 million tons. Approximately 200,000 tons remain unsold in 2004. Looking ahead, Mr. Craft said, "Based on our current projections, we are increasing estimated net income for the year ending December 31, 2004 to a range of $65.0 to $75.0 million, excluding any additional insurance recoveries for expenses and losses attributable to the Dotiki mine fire. For 2005, we are currently estimating coal production of approximately 21.3 million tons of which approximately 82% is committed under existing coal sales agreements. Approximately 49% of our estimated 2005 production is subject to market price negotiations for existing contracts as well as anticipated new coal supply agreements. We will continue to assess market demand and, should attractive opportunities become available, we will consider increasing production to meet the needs of our customers." The statements and projections used throughout this release are based on current expectations. These statements and projections are forward-looking, and actual results may differ materially. These projections do not include the potential impact of any mergers, acquisitions or other business combinations that may occur after the date of this release. At the end of this release, we have included more information regarding business risks that could affect our results. -MORE- Alliance Resource Partners is the nation's only publicly traded master limited partnership involved in the production and marketing of coal. Alliance Resource Partners currently operates eight mining complexes in Illinois, Indiana, Kentucky and Maryland. FORWARD-LOOKING STATEMENTS: WITH THE EXCEPTION OF HISTORICAL MATTERS, ANY MATTERS DISCUSSED IN THIS PRESS RELEASE ARE FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM PROJECTED RESULTS. THESE RISKS, UNCERTAINTIES AND CONTINGENCIES INCLUDE, BUT ARE NOT LIMITED TO, THE FOLLOWING: COMPETITION IN COAL MARKETS AND OUR ABILITY TO RESPOND TO THE COMPETITION; FLUCTUATION IN COAL PRICES, WHICH COULD ADVERSELY AFFECT OUR OPERATING RESULTS AND CASH FLOWS; DEREGULATION OF THE ELECTRIC UTILITY INDUSTRY OR THE EFFECTS OF ANY ADVERSE CHANGE IN THE DOMESTIC COAL INDUSTRY, ELECTRIC UTILITY INDUSTRY, OR GENERAL ECONOMIC CONDITIONS; DEPENDENCE ON SIGNIFICANT CUSTOMER CONTRACTS, INCLUDING RENEWING CUSTOMER CONTRACTS UPON EXPIRATION OF EXISTING CONTRACTS; CUSTOMER BANKRUPTCIES AND/OR CANCELLATIONS OF, OR BREACHES TO EXISTING CONTRACTS; CUSTOMER DELAYS OR DEFAULTS IN MAKING PAYMENTS; FLUCTUATIONS IN COAL DEMAND, PRICES AND AVAILABILITY DUE TO LABOR AND TRANSPORTATION COSTS AND DISRUPTIONS, EQUIPMENT AVAILABILITY, GOVERNMENTAL REGULATIONS AND OTHER FACTORS; OUR PRODUCTIVITY LEVELS AND MARGINS THAT WE EARN ON OUR COAL SALES; ANY UNANTICIPATED INCREASES IN LABOR COSTS, ADVERSE CHANGES IN WORK RULES, OR UNEXPECTED CASH PAYMENTS ASSOCIATED WITH POST-MINE RECLAMATION AND WORKERS' COMPENSATION CLAIMS; ANY UNANTICIPATED INCREASES IN TRANSPORTATION COSTS AND RISK OF TRANSPORTATION DELAYS OR INTERRUPTIONS; GREATER THAN EXPECTED ENVIRONMENTAL REGULATION, COSTS AND LIABILITIES; A VARIETY OF OPERATIONAL, GEOLOGIC, PERMITTING, LABOR AND WEATHER-RELATED FACTORS; RISKS OF MAJOR MINE-RELATED ACCIDENTS OR INTERRUPTIONS; RESULTS OF LITIGATION; DIFFICULTY MAINTAINING OUR SURETY BONDS FOR MINE RECLAMATION AS WELL AS WORKERS' COMPENSATION AND BLACK LUNG BENEFITS; DIFFICULTY OBTAINING COMMERCIAL PROPERTY INSURANCE; AND RISKS ASSOCIATED WITH OUR 10.0% PARTICIPATION (EXCLUDING ANY APPLICABLE DEDUCTIBLE) IN THE COMMERCIAL INSURANCE PROPERTY PROGRAM. ADDITIONAL INFORMATION CONCERNING THESE AND OTHER FACTORS CAN BE FOUND IN THE PARTNERSHIP'S PUBLIC PERIODIC FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION ("SEC"), INCLUDING THE PARTNERSHIP'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2003 FILED ON MARCH 12, 2004 WITH THE SEC. EXCEPT AS REQUIRED BY APPLICABLE SECURITIES LAWS, THE PARTNERSHIP DOES NOT INTEND TO UPDATE ITS FORWARD-LOOKING STATEMENTS. -MORE- ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OPERATING DATA (IN THOUSANDS, EXCEPT UNIT AND PER UNIT DATA) (UNAUDITED)
THREE MONTHS ENDED MARCH 31, --------------------------- 2004 2003 ------------ ------------ Tons sold 5,110 4,456 Tons produced 5,112 4,990 SALES AND OPERATING REVENUES: Coal sales $ 144,539 $ 114,450 Transportation revenues 6,838 4,315 Other sales and operating revenues 6,447 6,160 ------------ ------------ Total revenues 157,824 124,925 ------------ ------------ EXPENSES: Operating expenses 104,328 82,752 Transportation expenses 6,838 4,315 Outside purchases 1,065 1,019 General and administrative 10,329 5,651 Depreciation, depletion and amortization 12,771 13,131 Interest expense 3,843 3,967 ------------ ------------ Total operating expenses 139,174 110,835 ------------ ------------ INCOME FROM OPERATIONS 18,650 14,090 OTHER INCOME (EXPENSE) 314 (7) ------------ ------------ INCOME BEFORE INCOME TAXES 18,964 14,083 INCOME TAX EXPENSE 739 955 ------------ ------------ NET INCOME $ 18,225 $ 13,128 ============ ============ GENERAL PARTNERS' INTEREST IN NET INCOME (LOSS) $ 365 $ (389) ============ ============ LIMITED PARTNERS' INTEREST IN NET INCOME $ 17,860 $ 13,517 ============ ============ BASIC NET INCOME PER LIMITED PARTNER UNIT $ 1.00 $ 0.81 ============ ============ DILUTED NET INCOME PER LIMITED PARTNER UNIT $ 0.97 $ 0.79 ============ ============ WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING-BASIC 17,903,793 16,593,609 ============ ============ WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING-DILUTED 18,439,099 17,176,824 ============ ============
-MORE- ALLIANCE RESOURCE PARTNERS, L.P. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT UNIT DATA)
ASSETS MARCH 31, DECEMBER 31, 2004 2003 ---------- ------------ (UNAUDITED) CURRENT ASSETS: Cash and cash equivalents $ 24,819 $ 10,156 Trade receivables, net 47,644 38,305 Other receivables 2,901 -- Marketable securities 20,023 23,615 Inventories 15,204 14,527 Advance royalties 1,108 1,108 Prepaid expenses and other assets 2,136 3,432 --------- --------- Total current assets 113,835 91,143 PROPERTY, PLANT AND EQUIPMENT AT COST 486,623 474,357 LESS ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION (262,655) (251,567) --------- --------- 223,968 222,790 OTHER ASSETS: Advance royalties 12,051 12,439 Coal supply agreements, net 4,765 5,445 Other long-term assets 4,360 4,637 --------- --------- $ 358,979 $ 336,454 ========= ========= LIABILITIES AND PARTNERS' EQUITY CURRENT LIABILITIES: Accounts Payable $ 32,323 $ 22,651 Due to affiliates 15,904 13,546 Accrued taxes other than income taxes 11,684 10,375 Accrued payroll and related expenses 12,027 11,095 Accrued interest 1,662 5,402 Workers' compensation and pneumoconiosis benefits 5,944 5,905 Other current liabilities 6,257 5,739 --------- --------- Total current liabilities 85,801 74,713 --------- --------- LONG-TERM LIABILITIES: Long-term debt, excluding current maturities 180,000 180,000 Accrued pneumoconiosis benefits 17,874 17,633 Workers' compensation 24,223 22,819 Reclamation and mine closing 21,892 21,717 Due to affiliates 5,287 3,735 Other liabilities 3,409 3,280 --------- --------- Total liabilities 338,486 323,897 --------- --------- COMMITMENTS AND CONTINGENCIES PARTNERS' CAPITAL (DEFICIT): Common Unitholders 14,692,527 units outstanding 269,463 263,071 Subordinated Unitholders 3,211,266 units outstanding 59,808 58,411 General Partners (304,910) (305,034) Unrealized loss on marketable securities (79) (102) Minimum pension liability (3,789) (3,789) --------- --------- Total Partners' capital 20,493 12,557 --------- --------- $ 358,979 $ 336,454 ========= =========
-MORE- ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS) (UNAUDITED)
THREE MONTHS ENDED MARCH 31, ------------------------- 2004 2003 -------- -------- CASH FLOWS PROVIDED BY OPERATING ACTIVITIES $ 34,533 $ 13,047 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property, plant and equipment (13,427) (10,131) Purchase of Warrior Coal -- (12,661) Proceeds from sale of property, plant and equipment 254 38 Proceeds from maturity of marketable securities 3,615 -- -------- -------- Net cash used in investing activities (9,558) (22,754) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from common unit offering to public -- 53,965 Cash contribution by General Partners -- 9 Payments on Warrior Coal revolving credit agreement balance -- (17,000) Borrowings under revolving credit and working capital facilities -- 10,600 Payments under revolving credit and working capital facilities -- (5,600) Payments on long-term debt -- (3,750) Distributions to Partners (10,312) (8,253) -------- -------- Net cash provided by (used in) financing activities (10,312) 29,971 -------- -------- NET CHANGE IN CASH AND CASH EQUIVALENTS 14,663 20,264 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 10,156 9,028 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 24,819 $ 29,292 ======== ======== CASH PAID FOR: Interest $ 7,546 $ 7,928 ======== ======== Income taxes to taxing authorities $ -- $ 200 ======== ========
-MORE- Reconciliation of GAAP "Cash Flows Provided by Operating Activities" to Non-GAAP "EBITDA" and Reconciliation of Non-GAAP "EBITDA" to GAAP "Net Income" (in thousands).
THREE MONTHS ENDED MARCH 31, ---------------------- 2004 2003 ------- ------- Cash flows provided by operating activities $34,533 $13,047 Reclamation and mine closing (334) (335) Coal inventory adjustment to market - (24) Other (54) (723) Net effect of working capital changes (3,149) 14,294 Interest expense 3,843 3,967 Income taxes 739 955 ------- ------- EBITDA 35,578 31,181 Depreciation, depletion and amortization (12,771) (13,131) Interest expense (3,843) (3,967) Income taxes (739) (955) ------- ------- Net income $18,225 $13,128 ======= =======
EBITDA is defined as income before net interest expense, income taxes and depreciation, depletion and amortization. Management believes EBITDA is a useful indicator of its ability to meet debt service and capital expenditure requirements and uses EBITDA as a measure of operating performance. EBITDA should not be considered as an alternative to net income, income from operations, cash flows from operating activities or any other measure of financial performance presented in accordance with generally accepted accounting principles. EBITDA is not intended to represent cash flow and does not represent the measure of cash available for distribution. The Partnership's method of computing EBITDA may not be the same method used to compute similar measures reported by other companies, or EBITDA may be computed differently by the Partnership in different contexts (i.e. public reporting versus computation under financing agreements). -END- -----END PRIVACY-ENHANCED MESSAGE-----