Arch Coal Inc. (NYSE: ACI) reported second-quarter 2013 results before markets opened this morning. The coal miner posted an adjusted diluted earnings per share (EPS) loss of $0.29 on revenues of $766.3 million. In the same period a year ago, the company reported an EPS loss of $2.05 on revenues of $965.7 million. Second-quarter results also compare to the Thomson Reuters consensus estimates for an EPS loss of $0.33 and $920.49 million in revenues.

On a GAAP basis, the company’s net loss totaled $0.34 per share, which includes noncash charges for asset impairment and other items.

The company recently announced the sale of its Canyon Fuel subsidiary for $435 million and expects to realize administrative cost savings of $200 million through 2017 as a result. The sale is expected to close this quarter.

Arch currently expects thermal sales volumes, including volumes from Canyon Fuel, to be in the range of 130 million to 137 million tons for 2013. That is slightly better than the 125 million to 135 million tons forecast at the end of the first quarter. The company said domestic coal burning for electricity generation is up 10% through May and that declining customer stockpiles will support coal prices going forward.

The company has lowered its metallurgical sales forecast for the year from 8 million to 9 million tons to between 7.7 million and 8.3 million tons. Arch believes that the declining market for met coal is “unsustainable over the long term.”

The company’s CEO said:

During the second quarter, we achieved a sequential improvement in our earnings as we continued to manage our business effectively in the face of weak coal market conditions. Arch employed strong cost control, particularly in the Powder River Basin and in Appalachia, which positively impacted our per-ton margins. Our cost reduction initiatives are generating results, and we will continue to pursue aggressive cost reductions across all of our operations during the second half of the year.

Arch has also lowered its cash cost per ton guidance range in each of its producing regions and cut its capex spending by another $20 million.

The company’s shares are up 0.5% in premarket trading, at $4.14 in a 52-week range of $3.47 to $8.86. Thomson Reuters had a consensus analyst price target of around $5.40 before today’s report.

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