Walter Energy Announces First Quarter 2012 Results
BIRMINGHAM, AL -- (Marketwire) -- 05/02/12 -- Walter Energy, Inc. (NYSE: WLT) (TSX: WLT)
- First Quarter Revenues Reach $632 Million; EPS of $0.65; Operating Income of $84 Million; EBITDA of $144 Million
- Realizes All-Time Record Quarterly Metallurgical Coal Production of 3 Million Metric Tons
- Metallurgical Coal Sales of 2.4 Million; Inventory Grows by Over 500,000 Metric Tons
- Recent Costs Per Ton of Hard Coking Coal Continue to Improve in the U.S. and Canada
(Note: Trend comparisons with Fourth Quarter 2011 vs. First Quarter 2011 are included due to the Western Coal acquisition, effective April 1, 2011.)
Walter Energy, Inc. (NYSE: WLT) (TSX: WLT), the world's leading, publicly traded "pure-play" producer of metallurgical (met) coal for the global steel industry, today announced results for the first quarter ended March 31, 2012.
"Our first quarter results reflect sales of 2.4 million metric tons (MMTs) of met coal and were in line with the latest outlook we provided. However, when compared with prior periods, the first quarter reflects reduced profitability," said Walt Scheller, Chief Executive Officer. "First-quarter met coal production of 3 MMTs was better than our outlook for 2.8 to 2.9 MMTs and set a new quarterly record. I am particularly pleased that consolidated cash costs per ton of hard coking coal (HCC) have improved 12 percent when compared with the fourth quarter of 2011. Walter is on target to achieve our production targets while continuing to focus on further cost reductions."
First Quarter Financial Results
For the first quarter 2012, revenues reached $632 million, up significantly from the $409 million reported in the first quarter of 2011, reflecting the acquisition of Western Coal. As noted in the table below, operating income, net income and earnings per share were all lower in the first quarter of 2012 compared with the same period a year ago, reflecting losses from the Canadian and U.K. operations (including one-time costs at the Willow mine), higher U.S. operating costs and increased interest expense.
Operating income was $84 million in the first quarter 2012 and was comprised of $107 million from U.S. operations, partially offset by a first-quarter operating loss of $14 million in the Canadian and U.K. operations and a $9 million loss in the other segment. The operating loss in the Canadian and U.K. operations was primarily due to high operating costs. Earnings before interest, taxes, depreciation and amortization (EBITDA) was lower in the first quarter of 2012 reflecting these higher operating costs as mentioned. Lower coal sales prices also reduced all operating results compared with the fourth quarter of 2011.
Q1 2012 Q1 2011* Q4 2011
Revenue (millions) $632 $409 $700
Operating income (millions) $84 $120 $137
Net income (millions) $41 $82 $84
EPS - Diluted $0.65 $1.53 $1.34
Average shares - Diluted (millions) 62.7 53.5 62.7
EBITDA (millions) $144 $148 $207
Met Coal Sales (MMTs) 2.4 1.5 2.4
Met Coal Production (MMTs) 3.0 1.5 2.4
Consolidated Product Metrics
Average Net Selling Price HCC $226 $214 $244
PCI $188 N/A $212
Cash Cost Per Ton HCC $116 $100 $132
PCI $208 N/A $165
$159** $145**
U.S. Product Metrics
Average Net Selling Price HCC $221 $214 $243
Cash Cost Per Ton HCC $110 $100 $119
Canada and U.K. Metrics
Average Net Selling Price HCC $250 N/A $249
PCI $188 N/A $212
Cash Cost Per Ton HCC $145 N/A $168
*Does not include Western Coal Corporation, which was acquired April 1, 2011
**Cash cost per ton of pulverized coal injection (PCI) coal, excluding the Willow project
Cash Costs
The consolidated cash cost for HCC decreased 12 percent to $116 per metric ton (MT) compared with $132 per MT in the fourth quarter 2011. In the U.S. operations, the cash cost of HCC decreased 7 percent to $110 per MT compared with $119 per MT in the prior quarter. In the Canadian operations, the cash cost of HCC decreased 14 percent to $145 per MT compared with $168 in the prior quarter.
The improvement in cash cost for HCC was partially offset by higher cash costs per MT for PCI in the first quarter of 2012 compared with the fourth quarter 2011. At the Brule PCI mine, the cash cost per MT was $159 in the first quarter of 2012. Overall PCI cash costs per ton in the first quarter 2012 were affected by low first quarter production at the Willow mine, which resulted from the planned wash plant outage necessary to upgrade its capability to process HCC. The wash plant upgrade was successfully completed during the quarter and will allow for the processing of premium low-vol HCC from the Willow mine going forward.
Liquidity and Capital Expenditures
At the end of the first quarter 2012, available liquidity was $366 million, consisting of cash and cash equivalents of $138 million plus $228 million available under the Company's $375 million credit revolver. Capital expenditures for the first quarter were $121 million.
Metallurgical Sales Volume and Pricing
As anticipated in the Company's first-quarter outlook news release issued March 26, 2012, consolidated met coal sales volume was 2.4 MMTs in the first quarter of 2012. HCC sales volume of 1.9 MMTs was up 25 percent compared with 1.5 MMTs in the first quarter 2011, prior to the acquisition of Western Coal. PCI sales volume was 0.5 MMTs in the first quarter of 2012.
The average first-quarter 2012 selling price of HCC was $226 per MT, slightly above the $220 per MT price estimated in the Company's first-quarter outlook. However, the HCC selling price was 7 percent lower than the $244 per MT achieved last quarter, reflecting world market trends. The average first-quarter selling price for PCI was $188 per MT, again above the estimate of $180 per MT in the first-quarter outlook, but 11 percent lower than the $212 per MT achieved in the fourth quarter of 2011, reflecting world market trends.
Metallurgical Coal Production
Consolidated met coal production reached a quarterly record of 3 MMTs in the first quarter 2012, double the 1.5 MMTs produced in the first quarter of 2011 due largely to the acquisition of Western Coal. Compared with the fourth quarter, met coal production is up almost 25 percent from 2.4 MMTs produced in the fourth quarter 2011.
The Company increased its higher margin HCC production to 2.4 MMTs in the first quarter of 2012. HCC comprised 80 percent of met production in the first quarter of 2012 compared with 76 percent in the fourth quarter 2011. The remainder of met coal output in both periods was low-vol PCI coal.
2012 Production Guidance
The Company continues to forecast that full-year 2012 met coal production will be between 11.5 and 13.0 MMTs, of which an estimated 75 percent to 80 percent will be HCC and the remainder will be low-vol PCI.
Safety and Stewardship Highlights
U.S. operations reduced its total recordable injury rate by 16 percent in the first quarter of 2012 compared with first quarter 2011. Canadian and U.K. operations reduced their total reportable injury rate by 5 percent compared with the same period last year.
On April 20, the Brule mine was awarded the Edward Prior Safety Award for 2011 by the Office of the Chief Inspector of Mines from the Ministry of Natural Resource Operations in British Columbia, Canada, as recognition for dedication to safe operations in all aspects of its mining operations.
Use of Non-GAAP Measures
This release contains the use of certain U.S. non-GAAP (Generally Accepted Accounting Principles) measures. These non-GAAP measures are provided as supplemental information for financial measures prepared in accordance with GAAP. Management believes that these non-GAAP measures provide additional insights into the performance of the Company, and they reflect how management analyzes Company performance and compares that performance against other companies. A reconciliation of non-GAAP to GAAP measures is provided in the financial section of this release.
Conference Call Webcast
The Company will hold a conference call webcast to discuss first quarter 2012 results Thursday, May 3, 2012, at 8 a.m. CDT. To listen to the live event, visit www.walterenergy.com.
About Walter Energy
Walter Energy is the world's leading, publicly traded "pure-play" metallurgical coal producer for the global steel industry with strategic access to high-growth steel markets in Asia, South America and Europe. The Company also produces thermal coal, anthracite, metallurgical coke and coal bed methane gas. Walter Energy employs approximately 4,400 employees and contractors with operations in the United States, Canada and United Kingdom. For more information about Walter Energy, please visit www.walterenergy.com.
Safe Harbor Statement
Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and may involve a number of risks and uncertainties. Forward-looking statements are based on information available to management at the time, and they involve judgments and estimates. Forward-looking statements include expressions such as "believe," "anticipate," "expect," "estimate," "intend," "may," "plan," "predict," "will," and similar terms and expressions. 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: the market demand for coal, coke and natural gas as well as changes in pricing and costs; the availability of raw material, labor, equipment and transportation; changes in weather and geologic conditions; changes in extraction costs, pricing and assumptions and projections concerning reserves in our mining operations; changes in customer orders; pricing actions by our competitors, customers, suppliers and contractors; changes in governmental policies and laws, including with respect to safety enhancements and environmental initiatives; availability and costs of credit, surety bonds and letters of credit; and changes in general economic conditions. Forward-looking statements made by us in this release, or elsewhere, speak only as of the date on which the statements were made. See also the "Risk Factors" in our 2011 Annual Report on Form 10-K and subsequent filings with the SEC, which are currently available on our website at www.walterenergy.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 release, except as may be required by law. In light of these risks and uncertainties, readers should keep in mind that any forward-looking statement made in this press release may not occur. All data presented herein is as of the date of this release unless otherwise noted.
WALTER ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
($ in thousands, except per share and share amounts)
Unaudited
For the three months
ended March 31,
----------------------------
2012 (1) 2011
------------- -------------
Revenues:
Sales $ 627,298 $ 406,575
Miscellaneous income 4,265 2,159
------------- -------------
631,563 408,734
------------- -------------
Costs and expenses:
Cost of sales (exclusive of depreciation
and depletion) 431,534 218,460
Depreciation and depletion 66,493 28,358
Selling, general and administrative (2) 36,247 31,882
Postretirement benefits 13,213 10,267
------------- -------------
547,487 288,967
------------- -------------
Operating income 84,076 119,767
Interest expense (28,067) (3,556)
Interest income 277 156
Other loss (3) (6,993) -
------------- -------------
Income before income tax expense 49,293 116,367
Income tax expense (4) 8,677 34,554
------------- -------------
Net income $ 40,616 $ 81,813
============= =============
Net income per share:
Basic $ 0.65 $ 1.54
============= =============
Diluted $ 0.65 $ 1.53
============= =============
Weighted average number of common shares
outstanding (5):
Basic 62,462,692 53,190,274
============= =============
Diluted 62,739,018 53,519,062
============= =============
Comprehensive income $ 45,281 $ 94,470
============= =============
(1) Includes results of Western Coal acquired on April 1, 2011.
(2) The 2011 first quarter includes $9.9 million of costs associated with
the acquisition of Western Coal.
(3) The 2012 first quarter includes losses on the sale and re-measurement to
fair value of equity investments.
(4) The provision for income taxes in the first quarter of 2012 at a rate of
17.6% is based on an estimated effective annual tax rate for the year as
compared to 29.7% for the first quarter of 2011. The effective tax rate
for 2012 is lower than the first quarter 2011 tax rate, primarily due to
estimated foreign income and losses and the related international
jurisdictional tax rates which were not relevant to the Company prior to
the acquisition of Western Coal.
(5) The 2012 first quarter weighted average number of shares outstanding
gives effect to the issuance of 8,951,558 common shares on April 1, 2011
in connection with the acquisition of Western Coal.
WALTER ENERGY, INC. AND SUBSIDIARIES
RESULTS BY OPERATING SEGMENT (1)
($ in thousands)
Unaudited
For the three months
ended March 31,
----------------------------
2012 2011
------------- -------------
REVENUES:
U.S. Operations $ 452,150 $ 407,936
Canadian and U.K. Operations 178,351 -
Other 1,062 798
------------- -------------
Revenues $ 631,563 $ 408,734
============= =============
OPERATING INCOME (LOSS):
U.S. Operations $ 106,981 $ 138,973
Canadian and U.K. Operations (13,555) -
Other (2) (9,350) (19,206)
------------- -------------
Operating income $ 84,076 $ 119,767
============= =============
DEPRECIATION AND DEPLETION:
U.S. Operations $ 42,142 $ 28,169
Canadian and U.K. Operations 24,136 -
Other 215 189
------------- -------------
Depreciation and Depletion $ 66,493 $ 28,358
============= =============
CAPITAL EXPENDITURES:
U.S. Operations $ 36,112 $ 44,136
Canadian and U.K. Operations 84,180 -
Other 553 157
------------- -------------
Capital Expenditures $ 120,845 $ 44,293
============= =============
(1) Beginning in the second quarter of 2011 the Company reports all
operations located in the U.S. in the U.S. Operations segment which
includes Walter Energy's historical operating segments of Underground
Mining, Surface Mining and Walter Coke along with the West Virginia
mining operations acquired through the April 1, 2011 acquisition of
Western Coal. The Company reports its mining operations located in
northeast British Columbia (Canada) and South Wales (United Kingdom),
both acquired through the Western Coal acquisition, in the Canadian and
U.K. Operations segment. The Other segment primarily includes corporate
expenses. Segment information for the first quarter 2011 has been
restated to reflect the current segment reporting structure.
(2) The 2011 first quarter includes $9.9 million of costs associated with
the acquisition of Western Coal.
WALTER ENERGY, INC. AND SUBSIDIARIES
QUARTERLY STATISTICAL RESULTS BY OPERATING SEGMENT AND MAJOR PRODUCT
(Ton information in thousand metric tons and dollars in USD)
Consolidated Statistical
Information by Major Product
3 months 3 months 3 months
ended ended ended
March 31, March 31, December 31,
2012 2011 2011
------------ ------------ ------------
Total Metallurgical
Sales Metric Tons 2,367 1,487 2,401
Production Metric Tons 2,964 1,500 2,408
Average Net Selling Price $ 217.97 $ 213.98 $ 237.36
Average Cash Cost per Ton
(1)(2)(3) $ 136.05 $ 99.55 $ 139.08
Hard Coking
Sales Metric Tons 1,857 1,487 1,878
Production Metric Tons 2,378 1,500 1,840
Average Net Selling Price $ 226.21 $ 213.98 $ 244.34
Average Cash Cost per Ton (1)(3) $ 116.35 $ 99.55 $ 131.74
Low Vol PCI
Sales Metric Tons 510 - 523
Production Metric Tons 586 - 567
Production Metric Tons - Willow
Creek 120 - 155
Production Metric Tons - All
other 466 - 412
Average Net Selling Price $ 187.97 $ - $ 212.29
Average Cash Cost per Ton
(1)(2)(3) $ 207.76 $ - $ 165.44
Average Cash Cost per Ton -
Willow Creek (1)(2)(3) $ 448.87 $ - $ 216.14
Average Cash Cost per Ton - All
other (1)(3) $ 159.23 $ - $ 145.49
Thermal
Sales Metric Tons 807 321 1,068
Production Metric Tons 847 268 993
Average Net Selling Price $ 72.78 $ 92.11 $ 69.86
Average Cash Cost per Ton (1)(3) $ 79.87 $ 76.13 $ 69.40
US Segment Statistical Information
by Major Product
3 months 3 months 3 months
ended ended ended
March 31, March 31, December 31,
2012 2011 2011
------------ ------------ ------------
Hard Coking
Sales Metric Tons 1,535 1,487 1,390
Production Metric Tons 1,969 1,500 1,449
Average Net Selling Price $ 221.22 $ 213.98 $ 242.61
Average Cash Cost per Ton (1)(3) $ 110.33 $ 99.55 $ 118.88
Thermal
Sales Metric Tons 782 321 1,036
Production Metric Tons 816 268 965
Average Net Selling Price $ 71.27 $ 92.11 $ 68.71
Average Cash Cost per Ton (1)(3) $ 78.87 $ 76.13 $ 66.92
Canada and UK Segment Statistical
Information by Major Product
3 months 3 months 3 months
ended ended ended
March 31, March 31, December 31,
2012 2011 2011
------------ ------------ ------------
Total Metallurgical
Sales Metric Tons 832 - 1,011
Production Metric Tons 994 - 959
Average Net Selling Price $ 211.95 $ - $ 230.13
Average Cash Cost per Ton
(1)(2)(3) $ 183.52 $ - $ 166.84
Hard Coking
Sales Metric Tons 322 - 488
Production Metric Tons 408 - 391
Average Net Selling Price $ 250.00 $ - $ 249.24
Average Cash Cost per Ton (1)(3) $ 145.07 $ - $ 168.34
Low Vol PCI
Sales Metric Tons 510 - 523
Production Metric Tons 586 - 567
Production Metric Tons - Willow
Creek 120 - 155
Production Metric Tons - All
other 466 - 412
Average Net Selling Price $ 187.97 $ - $ 212.29
Average Cash Cost per Ton
(1)(2)(3) $ 207.76 $ - $ 165.44
Average Cash Cost per Ton -
Willow Creek (1)(2)(3) $ 448.87 $ - $ 216.14
Average Cash Cost per Ton - All
other (1)(3) $ 159.23 $ - $ 145.49
Thermal
Sales Metric Tons 25 - 32
Production Metric Tons 30 - 28
Average Net Selling Price $ 120.96 $ - $ 106.94
Average Cash Cost per Ton (1)(3) $ 111.86 $ - $ 149.08
(1) Average Cash Cost per Ton is based on reported Cost of Sales and
includes items such as freight, royalties, manpower, fuel and other
similar production and sales cost items but excludes depreciation,
depletion and post retirement benefits. Average Cash Cost per Ton is a
non-GAAP financial measure which is not calculated in conformity with
U.S. Generally Accepted Accounting Principles (GAAP) and should be
considered supplemental to, and not as a substitute or superior to
financial measures calculated in conformity with GAAP. We believe Cash
Cost per Ton is a useful measure as our management uses that as a
measure of performance and we believe it aids some investors and
analysts in comparing us against other companies to help analyze our
current and future potential performance.
(2) Production and Average Cash Cost per Ton for our Willow Creek mining
operations are separately provided for the current quarter as the mine's
production was adversely impacted by a planned wash plant outage
necessary to upgrade its capability to process premium low-volatile hard
coking coal. The plant upgrade was completed during the quarter.
(3) Reconciliation of Cash Cost per Ton to Cost of Sales as disclosed (in
thousands USD):
3 months 3 months 3 months
ended March ended March ended
31, 2012 31, 2011 December 31,
Actual Actual 2011 Actual
------------ ------------ ------------
Cash Costs as calculated from above
(sales tons times average cash
cost per ton) $ 386,513 $ 172,438 $ 408,058
Cash Costs of other products 45,021 46,022 42,746
Purchase Accounting One-Time
Effects on Cost of Sales - - 4,300
------------ ------------ ------------
Total Cost of Sales $ 431,534 $ 218,460 $ 455,104
============ ============ ============
WALTER ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
($ in thousands)
Unaudited
As of
--------------------------
Recast
March 31, December 31,
2012 (1) 2011(1)
------------ ------------
ASSETS
Cash and cash equivalents $ 138,200 $ 128,430
Receivables, net 293,674 313,343
Inventories 309,742 240,437
Deferred income taxes 58,894 61,079
Prepaid expenses 44,226 49,974
Other current assets 39,242 45,649
------------ ------------
Total current assets 883,978 838,912
Mineral interests, net 3,034,630 3,056,258
Property, plant and equipment, net 1,678,957 1,631,333
Deferred income taxes 109,868 109,300
Goodwill 1,066,754 1,066,754
Other long-term assets 138,081 153,951
------------ ------------
TOTAL ASSETS $ 6,912,268 $ 6,856,508
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current debt $ 69,144 $ 56,695
Accounts payable 125,494 112,661
Accrued expenses 194,477 229,067
Accumulated postretirement benefits obligation 27,714 27,247
Other current liabilities 55,953 63,757
------------ ------------
Total current liabilities 472,782 489,427
Long-term debt 2,312,858 2,269,020
Deferred income taxes 1,018,333 1,029,336
Accumulated postretirement benefits obligation 553,863 550,671
Other long-term liabilities 379,236 381,537
------------ ------------
TOTAL LIABILITIES 4,737,072 4,719,991
STOCKHOLDERS' EQUITY 2,175,196 2,136,517
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 6,912,268 $ 6,856,508
============ ============
(1) Includes accounts of Western Coal acquired on April 1, 2011. The
purchase price has been allocated to the assets acquired and liabilities
assumed based on their estimated fair values at the date of acquisition.
The acquisition was finalized during the 2012 first quarter. The
December 31, 2011 balance sheet has been recast to reflect the impacts
of finalizing the allocation of the purchase price. Retained earnings, a
component of stockholder's equity, as of December 31, 2011 was increased
by $14.4 million, primarily due to a decrease in mineral interests
depletion and income tax expense related to 2011.
WALTER ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2012
($ in thousands, except per share amounts)
Unaudited
Accumulated
Capital in Other
Common Excess of Retained Comprehensive
Total Stock Par Value Earnings Income (Loss)
---------- ------ ---------- -------- -------------
Balance at December
31, 2011, recast (1) $2,136,517 $ 624 $1,620,430 $744,939 $ (229,476)
Net income 40,616 40,616
Other comprehensive
income, net of tax 4,665 4,665
Stock issued upon the
exercise of stock
options 120 1 119
Dividends paid,
$0.125 per share (7,806) (7,806)
Stock-based
compensation 947 947
Excess tax benefits
from stock-based
compensation
arrangements 783 783
Other (646) - - (646)
---------- ------ ---------- -------- -------------
Balance at March 31,
2012 $2,175,196 $ 625 $1,622,279 $777,103 $ (224,811)
========== ====== ========== ======== =============
(1) Retained earnings as of December 31, 2011 has been recast to reflect the
impacts of finalizing the allocation of the Western Coal purchase price.
The balance was increased by $14.4 million primarily due to a decrease
in mineral interests depletion and income tax expense related to 2011.
WALTER ENERGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in thousands)
Unaudited
For the three months ended
March 31,
--------------------------
2012 2011
------------ ------------
OPERATING ACTIVITIES
Net income $ 40,616 $ 81,813
Adjustments to reconcile net income to net cash
flows provided by (used in) operating
activities:
Depreciation and depletion 66,493 28,358
Deferred income tax credit (10,894) -
Amortization of debt issuance costs 3,644 786
Other 8,756 3,175
Decrease (increase) in current assets:
Receivables 16,889 (1,753)
Inventories (63,192) 1,190
Prepaid expenses and other current assets 5,462 6,488
Increase (decrease) in current liabilities:
Accounts payable 37,604 (5,444)
Accrued expenses and other current
liabilities (34,524) 33,912
------------ ------------
Cash flows provided by operating
activities 70,854 148,525
------------ ------------
INVESTING ACTIVITIES
Additions to property, plant and equipment (120,845) (44,293)
Investment in Western Coal Corp. - (293,678)
Proceeds from sales of investments 12,228 -
Other (85) 211
------------ ------------
Cash flows used in investing activities (108,702) (337,760)
------------ ------------
FINANCING ACTIVITIES
Borrowings under revolving credit agreement 135,294 -
Repayments on revolving credit agreement (70,156) -
Retirements of debt (9,177) (7,199)
Dividends paid (7,806) (6,642)
Other (624) 2,336
------------ ------------
Cash flows provided by (used in) financing
activities 47,531 (11,505)
------------ ------------
EFFECT OF FOREIGN EXCHANGE RATES ON CASH 87 -
------------ ------------
Net increase (decrease) in cash and cash
equivalents $ 9,770 $ (200,740)
============ ============
Cash and cash equivalents at beginning of period $ 128,430 $ 293,410
Add: Cash and cash equivalents of discontinued
operations at beginning of period - 535
Net increase (decrease) in cash and cash
equivalents 9,770 (200,740)
------------ ------------
Cash and cash equivalents at end of period $ 138,200 $ 93,205
============ ============
WALTER ENERGY, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
Unaudited
RECONCILIATION OF EBITDA TO AMOUNTS REPORTED UNDER US GAAP:
For the three months ended
March 31,
--------------------------
($ in thousands) 2012 2011
------------ ------------
Net income $ 40,616 $ 81,813
Add interest expense 28,067 3,556
Less interest income (277) (156)
Add income tax expense 8,677 34,554
Add depreciation and depletion expense 66,493 28,358
------------ ------------
Earnings before interest, income taxes, and
depreciation and depletion (EBITDA) (1) $ 143,576 $ 148,125
============ ============
(1) EBITDA is defined as earnings from continuing operations before interest
expense, interest income, income taxes, and depreciation and depletion
expense. EBITDA is a financial measure which is not calculated in
conformity with U.S. Generally Accepted Accounting Principles (GAAP) and
should be considered supplemental to, and not as a substitute or
superior to financial measures calculated in conformity with GAAP. We
believe that EBITDA is a useful measure as some investors and analysts
use EBITDA to compare us against other companies and to help analyze our
ability to satisfy principal and interest obligations and capital
expenditure needs. EBITDA may not be comparable to similarly titled
measures used by other entities.
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Investor Relations Contact:
Paul Blalock
Vice President, Investor Relations
205.745.2627
paul.blalock@walterenergy.com