Contura Announces 2018 Guidance

BRISTOL, Tenn., February 12, 2018 – Contura Energy, Inc., a leading U.S. coal supplier, today announced production, cost and sales guidance for full-year 2018. The company expects to announce its fourth quarter and year-end 2017 results on or around March 29, 2018.

The company expects total 2018 coal shipments to be in the range of 15.0 million to 16.8 million tons across all operations, including 3.7 million to 4.1 million tons of captive Central Appalachia (CAPP) metallurgical coal and 4.2 million to 5.0 million tons of metallurgical coal through its Trading and Logistics segment. Northern Appalachia (NAPP) shipments, sold primarily into thermal markets, are anticipated to be between 7.1 million and 7.7 million tons.

As of February 6, 2018, 16% of the midpoint of anticipated 2018 CAPP coal shipments were committed and priced at an average expected per-ton realization of $113.53, with an additional 33% committed and either unpriced or priced based on various indices. Based on the midpoint of guidance, 88% of anticipated 2018 NAPP coal shipments were committed and priced at an average expected per-ton realization of $41.96.

Contura expects its 2018 CAPP cost of coal sales per ton to range from $68.00 to $73.00. NAPP cost estimates are projected to be between $29.00 to $33.00 per ton. Additionally, costs related to the company’s idle operations are expected to be between $10 million and $12 million for full-year 2018.

The margin from Contura’s Trading and Logistics platform is expected to average $9 to $15 per ton for the full-year 2018. The margin guidance excludes consideration of any remaining shipments relating to the Powder River Basin (PRB) assets that the company divested in early December 2017.

Contura’s capital expenditures for 2018 are expected to be in the range of $64 million to $74 million, while SG&A guidance is estimated at $32 million to $36 million, excluding one-time and non-recurring items, annual incentive bonus and stock compensation. Depreciation, depletion and amortization for 2018 is expected to be between $40 million and $50 million. The company expects 2018 cash interest expense to be between $25 million and $27 million.

2018 Full-Year Guidance

in millions of tons LowHigh
CAPP3.74.1
NAPP7.17.7
Total Production 10.811.8
Contura Trading & Logistics4.25.0
Total Shipments15.016.8

Committed/Priced[1][2][3]CommittedAverage Price
CAPP[4]16%$113.53
NAPP88%$41.96

Committed/Unpriced[1][3]Committed
CAPP[4]33%

Costs per tonLowHigh
CAPP$68.00$73.00
NAPP$29.00$33.00

Margin per ton[5]LowHigh
Contura Trading & Logistics$9$15

In millions (except taxes)LowHigh
SG&A[6]$32$36
Idle Operations Expense$10$12
Cash Interest Expense$25$27
DD&A$40$50
Capital Expenditures$64$74
Tax Rate0%5%

Notes:
[1] Based on committed and priced coal shipments as of February 6, 2018. Committed percentage based on the midpoint of shipment guidance range.
[2] Actual average per ton realizations on committed and priced tons recognized in future periods may vary based on actual freight expense in future periods relative to assumed freight expense embedded in projected average per-ton realizations.
[3] Includes estimates of future coal shipments based upon contract terms and anticipated delivery schedules. Actual coal shipments may vary from these estimates.
[4] CAPP committed tons and price information represent captive Contura production and does not include Trading and Logistics.
[5] Excludes impact of contracts related to the PRB divestiture that are still to be assigned.
[6] Excludes expenses related to non-cash stock compensation, accrual of incentive bonus and non-recurring business development expenses.

 

FORWARD-LOOKING STATEMENTS
This news release includes forward-looking statements. These forward-looking statements are based on Contura’s expectations and beliefs concerning future events and involve risks and uncertainties that may cause actual results to differ materially from current expectations. These factors are difficult to predict accurately and may be beyond Contura’s control. Forward-looking statements in this news release or elsewhere speak only as of the date made. New uncertainties and risks arise from time to time, and it is impossible for Contura to predict these events or how they may affect Contura. Except as required by law, Contura has no duty to, and does not intend to, update or revise the forward-looking statements in this news release or elsewhere after the date this release is issued. In light of these risks and uncertainties, investors should keep in mind that results, events or developments discussed in any forward-looking statement made in this news release may not occur.

 

ABOUT CONTURA ENERGY
Contura Energy is a private, Tennessee-based coal supplier with affiliate mining operations across major coal basins in Pennsylvania, Virginia and West Virginia. With customers across the globe, high-quality reserves and significant port capacity, Contura Energy reliably supplies both metallurgical coal to produce steel and thermal coal to generate power. For more information, visit www.conturaenergy.com.