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Powder River Basin third quarter volume 8% higher than Peabody expected

Peabody reported today that in the third quarter it exceeded its anticipated Powder River Basin volumes by 8%.

NARM - courtesy Peabody

Heavy equipment operates at Peabody Energy's North Antelope Rochelle mine in Wyoming's Powder River Basin. (Peabody Energy)

GILLETTE, Wyo. — Peabody reported today that in the third quarter it exceeded its anticipated Powder River Basin volumes by 8%.

The company said the Powder River Basin segment shipped 22.7 million tons at an average of $13.79 per ton. Tons sold increased by 3.8 million tons over the second quarter. Higher customer demand and improved rail performance were the top reasons for the increase. The Powder River Basin costs of $11.41 per ton were 7% lower than the second quarter because of higher production volumes and lower maintenance costs. The segment reported adjusted earnings before interest, taxes, depreciation and amortization margins of 17% and adjusted EBITDA of $54.1 million.

In the fourth quarter of this year, Peabody expects to ship about 21 million tons at an average $13.30 per ton and costs of about $11.15 per ton.

So far this year, the company returned $307 million through its shareholder return program through Oct. 20. That amount includes $287 million of share repurchases and dividends of $21 million. On Oct. 26, its dividend on common stock was $0.075 per share.

Peabody reported its net income attributable to common stockholders was $119.9 million, or $0.82 per diluted share, for the third quarter of 2023, down from $179.2 million, or $1.15 per diluted share in the second quarter. Peabody had adjusted EBITDA of $270 million in the third quarter of 2023, down from $358.2 million in the prior quarter. Its operating cash flow from continuing operations was $87.5 million, or net $81 million in working capital charges. Its cash and cash equivalents were $989 million.

“In the third quarter of 2023, we delivered strong operational results with better-than-expected production and effective cost management,” Peabody President and CEO Jim Grech said. “The diversity of our portfolio enables us to provide consistent and predictable results.”

Grech said Peabody made substantial progress on strengthening its metallurgical work as it moved to the next stage of redevelopment at North Goonyella in Australia and agreed to acquire an adjacent coal deposit. The acquired resources will support a North Goonyella mine life of at least 25 years.

Peabody said it also reached a $72 million settlement with the U.S. Department of Labor for legacy black lung claims.

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