Peabody Energy Corp. (NYSE: BTU) reported third-quarter 2014 results before markets opened Monday. The coal miner’s adjusted diluted earnings per share loss (EPS) came to $0.59 on revenues of $1.72 billion. In the same period a year ago, Peabody reported EPS of $0.05 on revenues of $1.8 billion. The consensus estimates called for an EPS loss of $0.66 on revenues of $1.64 billion.

U.S. mining revenues fell $1.02 billion due to lower volumes and reduced Midwestern revenues per ton. Australian revenues fell 4% as higher volumes partially offset a 13% drop in price.

Looking ahead, Peabody projects U.S. demand for coal for the full year will rise by 15 million tons above 2013 levels. The company said its 2014 production is fully priced and 2015 production is about 85% fully priced. Production for 2016 is 40% to 50% priced, based on this year’s expected production.

The company’s CEO said:

In the face of challenging times for the coal industry, Peabody continues to control the controllable and take the necessary actions to best position the company through strong operating performance, solid operating cash flows, lower costs and reduced capital targets. Regarding industry fundamentals, we look forward to greater realization of announced metallurgical coal supply cutbacks, continued growth in Indian coal imports, and improving Southern Powder River Basin rail performance to rebuild utility stockpiles and meet strong underlying demand.

For the full year, Peabody expects to post an EPS loss of $1.38 to $1.48, compared with a consensus estimate for a loss of $1.46. The company expects sales to total 245 million to 255 million tons. The midpoint of that range is slightly higher than 2013 sales of 251.7 million tons. Peabody also forecasts adjusted EBITDA of $765 million to $815 million.

The company noted that costs in the United States are down 1% to 3% per ton, and revenue per ton is expected to be about 2% to 4% below 2013 levels. Australian costs have dropped to about $70 a ton, and that is expected to help limit the loss.

Peabody did not offer an outlook for the fourth quarter of 2014. The consensus estimate calls for an EPS loss of $0.33 on revenues of $1.65 billion.

Shares were up about 0.6% in premarket trading Monday morning, at $11.10 in a 52-week range of $10.00 to $21.88. Prior to the report, Thomson/Reuters had a consensus price target of around $17.00 on the company’s shares.

ALSO READ: Why China’s Insatiable Appetite for Coal Has Likely Peaked?

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.