On February 1, St. Louis, US-based coal producer Patriot Coal issued increased financial results for the fourth quarter and the whole year of 2010, stating that the structural shortage in metallurgical coal is expected to continue for at least the next few years, allowing Patriot Coal to benefit from its strong reserves.
The results missed forecasts as weaker-than-expected revenue and charges related to a past acquisition offset benefits from higher coal prices.
According to the financial results, the net income of the company was $7.2 million in the fourth quarter of 2010, compared with a net income of $10.87 million in the fourth quarter of 2009 and with a net loss of $46 million in the third quarter of 2010.
Sales revenues in the fourth quarter of 2010 were $523.18 million, climbing from $494.63 million in the same period of the previous year and from $496.27 million in the previous quarter.
Sales in the fourth quarter totaled 7.7 million mt, including 6 million mt of thermal and 1.7 million mt of metallurgical coal. Total sales were lower than the 8.3 million mt sold in the fourth quarter of 2009, which included 6.7 million mt of thermal and 1.6 million mt of metallurgical coal. Compared with the 2010 third quarter, sales volume was 200.000 mt higher in the fourth quarter.
Meanwhile, revenues for 2010 of $2 billion were slightly higher than the 2009 data. The net loss of $48 million in 2010 compares with $127.24 million of net income in 2009. Full-year 2010 sales volume was 30.9 million mt compared with 32.8 million mt in 2009.
11 million mt met coal production by 2013
"This past year was one of building strength at Patriot in anticipation of improving global economies and markets. We emphasized the re-engineering of both surface and underground mines to address increased regulatory oversight. At the same time, we focused on increased met production and are now on a path to produce more than 11 million tons of metallurgical coal by 2013," noted Patriot president and chief executive officer Richard M. Whiting.
"This strategic growth, coupled with significantly higher margins on thermal business following the roll-off of two legacy sales contracts in the next two years, gives Patriot tremendous potential for earnings expansion," he added.