INTERNATIONAL COAL GROUP, INC. 
By SCOTT DEPOT, W.Va., April 27, 2011 /PRNewswire/ --
First-Quarter Highlights:
-- Adjusted EBITDA increases 39% over first quarter 2010
-- Record margin of $17.07 per ton is a 46% increase over first quarter
2010
-- Metallurgical shipments up 53% over first quarter 2010
International Coal Group, Inc. (NYSE: ICO) today reported its results for the first quarter of 2011.
-- Adjusted EBITDA was $65.1 million in the first quarter of 2011 compared
to $46.9 million during the first quarter of 2010.
-- Net income was $22.0 million, or $0.10 per share on a diluted basis, in
the first quarter of 2011 compared to a net loss of $8.9 million, or
$0.05 per share on a diluted basis, during the first quarter of 2010.
Net loss for the first quarter of 2010 included a $22.0 million pre-tax
loss on extinguishment of debt related to the Company's capital
restructuring. Excluding this loss, first quarter 2010 net income would
have been $6.2 million, or $0.03 per share on a diluted basis.
-- Margin per ton sold increased 46% to $17.07 in the first quarter of 2011
compared to $11.67 during the same period in 2010, primarily due to
higher price realization from increased metallurgical sales.
-- Coal sales revenues increased to $283.7 million in the first quarter of
2011 compared to $270.5 million during the first quarter of 2010.
"International Coal Group delivered another strong quarter as our commitment to increasing metallurgical coal production continues to pay dividends," said Ben Hatfield, President and CEO of ICG. "However, the quarter was not without its challenges, as extreme winter weather reduced production at our Vindex mine complex and continued rail congestion lowered shipments at several other operations."
Hatfield continued, "Steady operational performance at most business units during the quarter, coupled with strong sales prices, resulted in the highest per ton margin in our company's history. We expect margins to grow in each quarter this year as our metallurgical output is projected to increase and lower-priced sales commitments roll off."
Summarizing the current coal markets, Hatfield stated, "Metallurgical coal demand improved throughout the quarter, with prices reaching near-record levels. Conversely, thermal market conditions remain somewhat weak as low natural gas prices continue to constrain coal-fired electricity output."
Sales, Production and Reserves
ICG sold 3.9 million tons of coal during the first quarter of 2011 compared to 4.3 million tons during the first quarter of 2010. Production totaled 4.0 million tons for the first quarter of 2011 versus 3.9 million in the same period of 2010. Metallurgical shipments of 718,000 tons represented a 53% increase over the same period in 2010.
As of March 31, 2011, ICG controlled approximately 1.1 billion tons of coal reserves, located primarily in Illinois, Kentucky, West Virginia, Ohio, Maryland and Virginia. Additionally, the Company controlled approximately 437 million tons of non-reserve coal deposits, which may be classified as reserves in the future as additional drilling and geological work is completed.
Operational and Other Updates
-- Construction at the new Tygart Valley No. 1 deep mine complex is
proceeding on schedule. Slope and shaft construction are progressing as
planned. Foundation construction for the state-of-the-art coal
preparation facility is underway, with construction of the structure
expected to begin in June 2011. Initial coal production is projected for
late fourth quarter of this year. At full output, currently projected
for early 2014, Tygart Valley No. 1 is expected to produce approximately
3.5 million tons per year.
-- Results for the first quarter of 2011 include a $6.5 million pre-tax
gain from the sale of an idled dragline, previously used at ICG
Eastern's Birch River operation.
Market Outlook and Committed Sales
Near term market conditions remain mixed. While metallurgical markets are near record price levels, thermal demand has been lukewarm, as low natural gas prices continue to restrict coal-fired electricity output. The effect of low natural gas prices is magnified during the "shoulder months" when electricity demand is traditionally curbed. Nevertheless, several positive signs support our expectation of a stronger thermal market in the second half of 2011 and throughout 2012, including:
-- cold winter weather that helped draw down record level natural gas
inventories;
-- coal inventories that are approaching more normalized levels as
industry-wide coal production remains disciplined;
-- an overall economic climate that is anticipated to improve; and
-- metallurgical markets that are expected to remain strong.
Recent over-the-counter trades support this view as prompt-month CSX pricing is 17% higher than a year ago, calendar year 2012 pricing is nearly 10% higher and the recent Australian quarterly benchmark price settlement of $330 per tonne is 46% higher than last year.
For 2011, committed and priced sales total approximately 13.9 million tons, or 85% of planned shipments, at an average price of $75.75 per ton, excluding freight and handling expenses. Unpriced tonnage includes approximately 1.8 million tons of thermal coal and 0.6 million tons of metallurgical coal.
For 2012, committed and priced sales total approximately 4.2 million tons, or 25% of planned shipments, at an average price of $60.00 per ton, excluding freight and handling expenses. Unpriced tonnage includes approximately 9.6 million tons of thermal coal and 3.2 million tons of metallurgical coal. The majority of 2012 committed sales consists of lower-priced Illinois Basin and Northern Appalachia legacy contracts.
Liquidity and Debt
As of March 31, 2011, the Company had $186.6 million in cash and $39.2 million in borrowing capacity available under its credit agreement.
Debt outstanding as of March 31, 2011 totaled $333.6 million, net of a $32.3 million discount, consisting primarily of $115.0 million aggregate principal amount of 4.0% Convertible Senior Notes and $200.0 million aggregate principal amount of 9.125% Senior Secured Second-Priority Notes.
On March 31, 2011, the Company announced that its $115.0 million of 4.0% Convertible Senior Notes and $731,000 of 9.0% Convertible Senior Notes became convertible at the option of the holders beginning April 1, 2011. Although all of the convertible notes are now classified as current liabilities, the Company does not believe that a significant number of conversions are likely at this time, and to date has received no notices of exercise of conversion rights. The triggering of the conversion rights are not expected to have a material effect on the Company's financial position.
Outlook
The Company has updated its guidance, reflecting modifications to its production mix and the global economic conditions affecting the coal market, as follows:
-- For 2011, the Company expects to produce and sell between 16.1 million
and 16.5 million tons of coal, including 3.2 million to 3.5 million tons
of metallurgical coal. The average selling price is projected to be
$76.00 per ton to $79.00 per ton, with an anticipated average cost of
$56.50 to $58.50 per ton, excluding selling, general and administrative
expenses.
-- Adjusted EBITDA, or earnings before deducting interest, income taxes,
depreciation, depletion, amortization and noncontrolling interest, is
expected to be in the range of $290 million to $320 million in 2011.
-- The Company projects its effective tax rate to be approximately 30% for
2011.
-- The Company's expectation for average coal pricing by region for 2011 is
as follows:
Region 2011 Forecast
------ -------------
Central Appalachia $81.00 - $85.00
Northern Appalachia $90.00 - $94.00
Illinois Basin $38.50 - $39.50
Average $76.00 - $79.00
-- The Company anticipates 2011 capital expenditures of between $225
million and $245 million, including approximately $145 million related
to development projects, primarily at our Tygart Valley No. 1, Illinois
and Vindex operations.
-- For 2012, the Company expects to produce and sell between 16.5 million
and 17.5 million tons of coal, including 3.3 million to 3.7 million tons
of metallurgical coal. The average selling price is projected to be
$83.00 per ton to $89.00 per ton
General Information
ICG is a leading producer of coal in Northern and Central Appalachia and the Illinois Basin. The Company has 13 active mining complexes, of which 12 are located in Northern and Central Appalachia and one in Central Illinois. ICG's mining operations and reserves are strategically located to serve utility, metallurgical and industrial customers domestically and internationally.
Forward-Looking Statements
-- Statements in this press release that are not historical facts are
forward-looking statements within the "safe harbor" provision of the
Private Securities Litigation Reform Act of 1995 and may involve a
number of risks and uncertainties. We have used the words "anticipate,"
"believe," "could," "estimate," "expect," "intend," "may," "plan,"
"predict," "project" and similar terms and phrases, including references
to assumptions, to identify forward-looking statements. These
forward-looking statements are made based on expectations and beliefs
concerning future events affecting us and are subject to various risks,
uncertainties and factors relating to our operations and business
environment, all of which are difficult to predict and many of which are
beyond our control, that could cause our actual results to differ
materially from those matters expressed in or implied by these
forward-looking statements. The following factors are among those that
may cause actual results to differ materially from our forward-looking
statements: market demand for coal, electricity and steel; availability
of qualified workers; future economic or capital market conditions;
weather conditions or catastrophic weather-related damage; our
production capabilities; consummation of financing, acquisition or
disposition transactions and the effect thereof on our business; a
significant number of conversions of our convertible senior notes prior
to maturity; our plans and objectives for future operations and
expansion or consolidation; our relationships with, and other conditions
affecting, our customers; availability and costs of key supplies or
commodities, such as diesel fuel, steel, explosives and tires;
availability and costs of capital equipment; prices of fuels which
compete with or impact coal usage, such as oil and natural gas; timing
of reductions or increases in customer coal inventories; long-term coal
supply arrangements; reductions and/or deferrals of purchases by major
customers; risks in or related to coal mining operations, including
risks related to third-party suppliers and carriers operating at our
mines or complexes; unexpected maintenance and equipment failure;
adoption by Appalachian states of EPA guidance regarding stringent water
quality-based limitations in CWA Section 402 wastewater discharge
permits and CWA Section 404 dredge and fill permits; environmental,
safety and other laws and regulations, including those directly
affecting our coal mining and production, and those affecting our
customers' coal usage; ability to obtain and maintain all necessary
governmental permits and authorizations; competition among coal and
other energy producers in the United States and internationally;
railroad, barge, trucking and other transportation availability,
performance and costs; employee benefits costs and labor relations
issues; replacement of our reserves; our assumptions concerning
economically recoverable coal reserve estimates; availability and costs
of credit, surety bonds and letters of credit; title defects or loss of
leasehold interests in our properties which could result in
unanticipated costs or inability to mine these properties; the impact of
the mine explosion at a competitor's mine on federal and state
authorities' decisions to enact laws and regulations that result in more
frequent mine inspections, stricter enforcement practices and enhanced
reporting requirements; future legislation and changes in regulations or
governmental policies or changes in interpretations or enforcement
thereof, including with respect to safety enhancements and environmental
initiatives relating to global warming and climate change; impairment of
the value of our long-lived and deferred tax assets; our liquidity,
including our ability to adhere to financial covenants related to our
borrowing arrangements; adequacy and sufficiency of our internal
controls; and legal and administrative proceedings, settlements,
investigations and claims, including those related to citations and
orders issued by regulatory authorities, and the availability of related
insurance coverage.
-- You should keep in mind that any forward-looking statement made by us in
this press release or elsewhere speaks only as of the date on which the
statements were made. See also the "Risk Factors" in our 2010 Annual
Report on Form 10-K and subsequent filings with the Securities and
Exchange Commission, all of which are currently available on our website
at www.intlcoal.com. New risks and uncertainties arise from time to
time, and it is impossible for us to predict these events or how they
may affect us or our anticipated results. We have no duty to, and do not
intend to, update or revise the forward-looking statements in this press
release, except as may be required by law. In light of these risks and
uncertainties, you should keep in mind that any forward-looking
statement made in this press release might not occur.
INTERNATIONAL COAL GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2011 AND 2010
(in thousands, except share and per share amounts)
Three months ended
------------------
March 31,
---------
2011 2010
---- ----
REVENUES:
Coal sales revenues $283,711 $270,490
Freight and handling revenues 7,152 9,377
Other revenues 11,126 8,727
------ -----
Total revenues 301,989 288,594
COSTS AND EXPENSES:
Cost of coal sales 217,964 220,065
Freight and handling costs 7,152 9,377
Cost of other revenues 7,342 7,181
Depreciation, depletion and amortization 25,656 26,397
Selling, general and administrative 11,152 8,585
Gain on sale of assets, net (6,723) (3,481)
------ ------
Total costs and expenses 262,543 268,124
------- -------
Income from operations 39,446 20,470
INTEREST AND OTHER INCOME (EXPENSE)
Loss on extinguishment of debt - (21,987)
Interest expense, net (8,110) (13,300)
------ -------
Total interest and other income
(expense) (8,110) (35,287)
------ -------
Income (loss) before income taxes 31,336 (14,817)
INCOME TAX BENEFIT (EXPENSE) (9,357) 5,965
------ -----
Net income (loss) 21,979 (8,852)
Net income attributable to
noncontrolling interest (11) -
--- ---
Net income (loss) attributable to
International Coal Group, Inc. $21,968 $(8,852)
======= =======
Other Data:
Adjusted EBITDA (a) $65,102 $46,867
Earnings per share:
Basic $0.11 $(0.05)
Diluted $0.10 $(0.05)
Weighted-average shares:
Basic 202,699,052 181,382,766
Diluted 214,478,342 181,382,766
This press release includes a non-GAAP financial measure within the
meaning of applicable SEC rules and regulations. Adjusted EBITDA is
a non-GAAP financial measure used by management to gauge operating
performance. We define Adjusted EBITDA as net income or loss
attributable to International Coal Group, Inc. before deducting
interest, income taxes, depreciation, depletion, amortization, loss
on extinguishment of debt and noncontrolling interest. Adjusted
EBITDA is not, and should not be used as, a substitute for operating
income, net income and cash flow as determined in accordance with
GAAP. We present Adjusted EBITDA because we consider it an important
supplemental measure of our performance and believe it is frequently
used by securities analysts, investors and other interested parties
in the evaluation of companies in our industry, substantially all of
which present EBITDA or Adjusted EBITDA when reporting their
results. We also use Adjusted EBITDA as our executive compensation
plan bases incentive compensation payments on our Adjusted EBITDA
performance measured against budgets. Our ABL Loan Facility uses
Adjusted EBITDA (with additional adjustments) to measure our
compliance with covenants, such as fixed charge ratio. EBITDA or
Adjusted EBITDA is also widely used by us and others in our industry
to evaluate and price potential acquisition candidates. Adjusted
EBITDA has limitations as an analytical tool, and you should not
consider it in isolation or as a substitute for analysis of our
results as reported under GAAP. Some of these limitations are that
Adjusted EBITDA does not reflect our cash expenditures, or future
requirements, for capital expenditures or contractual commitments;
changes in, or cash requirements for, our working capital needs;
interest expense, or the cash requirements necessary to service
interest or principal payments, on our debts. Although depreciation,
depletion and amortization are non-cash charges, the assets being
depreciated, depleted and amortized will often have to be replaced
in the future. Adjusted EBITDA does not reflect any cash
requirements for such replacements. Other companies in our industry
may calculate EBITDA or Adjusted EBITDA differently than we do,
limiting its usefulness as a comparative measure. A reconciliation
of Adjusted EBITDA to GAAP net income or loss attributable to
International Coal Group, Inc. appears at the end of this press
(a) release.
INTERNATIONAL COAL GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2011 AND DECEMBER 31, 2010
(in thousands)
March 31,
2011
----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $186,566
Accounts receivable, net 111,210
Inventories, net 80,724
Deferred income taxes 2,983
Prepaid expenses and other 21,008
------
Total current assets 402,491
PROPERTY, PLANT, EQUIPMENT AND MINE
DEVELOPMENT, net 1,051,064
DEBT ISSUANCE COSTS, net 8,937
ADVANCE ROYALTIES, net 21,639
OTHER NON-CURRENT ASSETS 12,008
------
Total assets $1,496,139
==========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable $80,294
Short-term debt 1,598
Current portion of long-term debt
and capital leases 103,527
Current portion of reclamation and
mine closure costs 8,364
Current portion of employee
benefits 3,831
Accrued expenses and other 48,991
------
Total current liabilities 246,605
LONG-TERM DEBT AND CAPITAL LEASE 228,437
RECLAMATION AND MINE CLOSURE COSTS 71,541
EMPLOYEE BENEFITS 84,129
DEFERRED INCOME TAXES 57,950
BELOW-MARKET COAL SUPPLY AGREEMENTS 25,934
OTHER NON-CURRENT LIABILITIES 3,921
-----
Total liabilities 718,517
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock 2,042
Treasury stock (309)
Additional paid-in capital 852,812
Accumulated other comprehensive
loss (3,353)
Retained deficit (73,634)
-------
Total International Coal Group,
Inc. stockholders' equity 777,558
Noncontrolling interest 64
Total stockholders' equity 777,622
-------
Total liabilities and stockholders'
equity $1,496,139
==========
December
31, 2010
--------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $215,276
Accounts receivable, net 82,557
Inventories, net 70,029
Deferred income taxes 13,563
Prepaid expenses and other 19,172
------
Total current assets 400,597
PROPERTY, PLANT, EQUIPMENT AND MINE
DEVELOPMENT, net 1,040,118
DEBT ISSUANCE COSTS, net 11,998
ADVANCE ROYALTIES, net 16,037
OTHER NON-CURRENT ASSETS 10,947
------
Total assets $1,479,697
==========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable $78,899
Short-term debt 2,797
Current portion of long-term debt
and capital leases 17,928
Current portion of reclamation and
mine closure costs 8,414
Current portion of employee
benefits 3,831
Accrued expenses and other 61,092
------
Total current liabilities 172,961
LONG-TERM DEBT AND CAPITAL LEASE 308,422
RECLAMATION AND MINE CLOSURE COSTS 70,730
EMPLOYEE BENEFITS 81,868
DEFERRED INCOME TAXES 60,452
BELOW-MARKET COAL SUPPLY AGREEMENTS 26,823
OTHER NON-CURRENT LIABILITIES 4,176
-----
Total liabilities 725,432
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock 2,038
Treasury stock (216)
Additional paid-in capital 851,440
Accumulated other comprehensive
loss (3,459)
Retained deficit (95,602)
-------
Total International Coal Group,
Inc. stockholders' equity 754,201
Noncontrolling interest 64
Total stockholders' equity 754,265
-------
Total liabilities and stockholders'
equity $1,479,697
==========
INTERNATIONAL COAL GROUP, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2011 AND 2010
(in thousands)
Three months
ended
------------
March 31,
---------
2011
----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $21,979
Adjustments to reconcile net income (loss) to net
cash from operating activities:
Depreciation, depletion and amortization 25,656
Loss on extinguishment of debt -
Amortization and write-off of deferred finance
costs and debt discount 1,458
Amortization of accumulated employee benefit
obligations 172
Compensation expense on share based awards 1,218
Gain on sale of assets, net (6,723)
Provision for bad debt 329
Deferred income taxes 8,012
Changes in assets and liabilities:
Accounts receivable (18,813)
Inventories (10,695)
Prepaid expenses and other (1,836)
Other non-current assets (4,530)
Accounts payable 912
Accrued expenses and other (12,101)
Reclamation and mine closure costs 761
Other liabilities 2,067
-----
Net cash from operating activities 7,866
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of assets 245
Additions to property, plant, equipment and mine
development (31,106)
Withdrawals of restricted cash 394
Distribution to joint venture (11)
Net cash from investing activities (30,478
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments on short-term debt (1,199)
Repayments on long-term debt and capital lease (4,964)
Proceeds from convertible notes offering -
Proceeds from senior notes offering -
Proceeds from common stock offering -
Repurchases of senior notes -
Purchases of treasury stock (93)
Proceeds from stock options exercised 158
Debt issuance costs -
---
Net cash from financing activities (6,098)
------
NET CHANGE IN CASH AND CASH EQUIVALENTS (28,710)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 215,276
-------
CASH AND CASH EQUIVALENTS, END OF PERIOD $186,566
========
Three months
ended
------------
March 31,
---------
2010
----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $(8,852)
Adjustments to reconcile net income (loss) to net
cash from operating activities:
Depreciation, depletion and amortization 26,397
Loss on extinguishment of debt 21,987
Amortization and write-off of deferred finance
costs and debt discount 3,158
Amortization of accumulated employee benefit
obligations (7)
Compensation expense on share based awards 984
Gain on sale of assets, net (3,481)
Provision for bad debt (79)
Deferred income taxes (7,583)
Changes in assets and liabilities:
Accounts receivable (24,463)
Inventories 3,914
Prepaid expenses and other 856
Other non-current assets 761
Accounts payable 5,425
Accrued expenses and other (16,133)
Reclamation and mine closure costs (339)
Other liabilities 2,890
-----
Net cash from operating activities 5,435
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of assets 1,000
Additions to property, plant, equipment and mine
development (20,635)
Withdrawals of restricted cash 8,854
Distribution to joint venture -
Net cash from investing activities (10,781)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments on short-term debt (833)
Repayments on long-term debt and capital lease (4,928)
Proceeds from convertible notes offering 115,000
Proceeds from senior notes offering 198,596
Proceeds from common stock offering 102,453
Repurchases of senior notes (181,612)
Purchases of treasury stock (11)
Proceeds from stock options exercised -
Debt issuance costs (14,243)
-------
Net cash from financing activities 214,422
-------
NET CHANGE IN CASH AND CASH EQUIVALENTS 209,076
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 92,641
------
CASH AND CASH EQUIVALENTS, END OF PERIOD $301,717
========
INTERNATIONAL COAL GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
FOR THE THREE MONTHS ENDED MARCH 31, 2011 AND 2010 (Unaudited)
(in thousands)
Three months ended
------------------
March 31,
---------
2011 2010
---- ----
Net income (loss) attributable to
International Coal Group, Inc. $21,968 $(8,852)
Depreciation, depletion and
amortization 25,656 26,397
Interest expense, net 8,110 13,300
Income tax (benefit) expense 9,357 (5,965)
Loss on extinguishment of debt - 21,987
Noncontrolling interest 11 -
--- ---
Adjusted EBITDA $65,102 $46,867
======= =======
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED NET INCOME
FOR THE THREE months ENDED March 31, 2011 and 2010 (Unaudited)
(in thousands)
Three months ended
------------------
March 31,
---------
2011 2010
---- ----
Net income (loss) attributable to
International Coal Group, Inc. $21,968 $(8,852)
Loss on extinguishment of debt - 21,987)
Income tax benefit - (6,926)
--- ------
Adjusted net income attributable to
International Coal Group, Inc. $21,968 $6,209
======= ======
OPERATING STATISTICS
FOR THE THREE MONTHS ENDED MARCH 31, 2011 AND 2011 (Unaudited)
(in thousands, except per ton amounts)
Central Northern Illinois
------- -------- --------
Appalachia Appalachia Basin
---------- ---------- -----
For the three months ended March 31,
2011:
------------------------------------
Tons sold 2,240 957 654
Coal sales revenues $179,359 $79,080 $25,272
Cost of coal sales $142,777 $55,672 $18,513
Coal sales revenue per ton (b) $80.07 $82.66 $38.61
Cost of coal sales per ton (b) $63.74 $58.19 $28.29
For the three months ended March 31,
2010:
------------------------------------
Tons sold 2,473 1,069 651
Coal sales revenues $178,964 $60,365 $23,536
Cost of coal sales $140,266 $53,671 $19,408
Coal sales revenue per ton (b) $72.36 $56.45 $36.14
Cost of coal sales per ton (b) $56.71 $50.19 $29.80
Purchased Total
--------- -----
Coal
and
Ancillary
----------
For the three months ended March 31,
2011:
------------------------------------
Tons sold - 3,851
Coal sales revenues $ - $283,711
Cost of coal sales $1,002 $217,964
Coal sales revenue per ton (b) $ n/m (c) $73.67
Cost of coal sales per ton (b) $ n/m (c) $56.60
For the three months ended March 31,
2010:
------------------------------------
Tons sold 130 4,323
Coal sales revenues $7,625 $270,490
Cost of coal sales $6,720 $220,065
Coal sales revenue per ton (b) $59.00 $62.57
Cost of coal sales per ton (b) $52.00 $50.90
"Coal sales revenue per ton" and "Cost of coal sales per ton" are
calculated as Coal sales revenues or Cost of coal sales,
respectively, divided by Tons sold. Although Coal sales revenue per
ton and Cost of coal sales per ton are not measures of performance
calculated in accordance with GAAP, management believes that they
are useful to an investor in evaluating performance because they are
widely used in the coal industry as a measure to evaluate a
company's sales performance or control over its costs. Coal sales
revenue per ton and Cost of coal sales per ton should not be
considered in isolation or as substitutes for measures of
performance in accordance with GAAP. In addition, because Coal sales
revenue per ton and Cost of coal sales per ton are not calculated
identically by all companies, ICG's presentation may not be
(b) comparable to other similarly titled measures of other companies.
Coal sales within the Purchased Coal and Ancillary segment represent
coal sold under brokered coal contracts, all of which were legacy
contracts obtained in conjunction with business combinations. Per
ton information for the three months ended March 31, 2011 within the
Purchased Coal and Ancillary segment is not meaningful as all such
supply contracts have expired. Cost of coal sales shown for the
three months ended March 31, 2011 represents costs incurred at non-
(c) producing coal operations.
SOURCE International Coal Group, Inc.
