Unconsolidated Subsidiaries

9 Months Ended

Sep. 30, 2017

Equity Method Investments and Joint Ventures [Abstract]

NACoal's wholly owned unconsolidated subsidiaries each meet the definition of a variable interest entity. See Note 1 for a discussion of these entities.

The investment in the unconsolidated subsidiaries and related tax positions totaled $27.3 million and $31.1 million at September 30, 2017 and December 31, 2016, respectively. The Company's maximum risk of loss relating to these entities is limited to its invested capital, which was $17.8 million and $4.6 million at September 30, 2017 and December 31, 2016, respectively.

NACoal is a party to certain guarantees related to Coyote Creek. Under certain circumstances of default or termination of Coyote Creek’s Lignite Sales Agreement (“LSA”), NACoal would be obligated for payment of a "make-whole" amount to Coyote Creek’s third-party lenders. The “make-whole” amount is based on the excess, if any, of the discounted value of the remaining scheduled debt payments over the principal amount. In addition, in the event Coyote Creek’s LSA is terminated on or after January 1, 2024 by Coyote Creek’s customers, NACoal is obligated to purchase Coyote Creek’s dragline and rolling stock for the then net book value of those assets. To date, no payments have been required from NACoal since the inception of these guarantees. The Company believes that the likelihood of NACoal’s future performance under the guarantees is remote, and no amounts related to these guarantees have been recorded.

Summarized financial information for the unconsolidated subsidiaries is as follows:



	THREE MONTHS ENDED				NINE MONTHS ENDED
	SEPTEMBER 30				SEPTEMBER 30
	2017		2016		2017		2016
Revenues	$	203,134	$	178,009	$	571,862	$	483,360
Gross profit	$	23,126	$	21,367	$	64,981	$	59,788
Income before income taxes	$	16,602	$	14,755	$	45,928	$	41,122