Metallurgical coal producer Walter Energy announced that in Q3 revenues were $612 million, down from $689 million a year earlier due to lower pricing and softening world coal demand. As a result, Walter Energy incurred a net loss of $1.1 billion during the quarter. However, the company earned an adjusted net income of $30 million excluding impairment charges for Q3.
Q2 2012 met coal sales volume including both hard coking coal (HCC) and low-volatility (low-vol) PCI was 2.62 million metric tons (MMTs), or 8 percent less than in Q2. Sales were impacted by weaker worldwide demand and excess supply. HCC sales volume was 2.18 MMTs in Q3 compared to 2.29 MMTs in Q2. PCI sales volume was 0.44 MMTs, down from 0.55 MMTs in the prior quarter. Average selling prices also felling sequentially in Q3, but met coal production increased. Met coal production was 3.33 MMTs in Q3 2012. Met coal production increased 47 percent from the 2.27 MMTs produced in Q3 2011 and was 14 percent higher than the 2.91 MMTs produced in Q2 2012.
"Our operational results in the third quarter were encouraging as we improved metallurgical coal production 14% as compared to the second quarter, while lowering cash costs of production," said Walt Scheller, Chief Executive Officer. "However, the recovery in the global economy and metallurgical coal markets is uncertain. As a result we are focusing on achieving further cost reductions, tightly managing capital spending and reducing marginal production in order to improve our results and be well positioned going into 2013."