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Arch Resources (ARCH) Q2 Loss Wider Than Expected, Sales Top
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Arch Resources Inc. (ARCH - Free Report) reported second-quarter 2020 operating loss of $3.26 per share, wider than the Zacks Consensus Estimate of a loss of $3.22. In the year-ago quarter, however, the company reported earnings of $3.53 per share.
Total Revenues
Total revenues amounted to $319.5 million, which beat the Zacks Consensus Estimate of $266 million by 20.1%.
Segment Details
In the Metallurgical segment, the company sold 1.5 million tons of coal, down 21% from the prior-year figure of 1.9 million tons. It recorded cash margins of $14.22 per ton compared with $53.80 in the year-ago quarter due to lower sales price.
During the quarter, the Powder River Basin segment’s cash margin per ton was (56 cents) versus 79 cents in the prior-year period. The company sold 10.6 million tons, down from the year-ago figure of 17.1 million tons.
In the Other Thermal segment, its cash margin was ($5.56) per ton versus $5.47 in the prior-year period. Shipments also declined 47.4% year over year to 1 million tons.
Arch Resources Inc. Price, Consensus and EPS Surprise
During the second quarter, Arch Resources invested $46 million in the Leer South mine development and expects to pump more capital between $360 million and $390 million into the project for its completion. As of Jun 30, 2020, the company invested $211 million in the project. It is on track to commence longwall operations at the mine in third-quarter 2021. When fully operational, the mine is expected to produce up to four million tons of High-Vol A coking coal annually for sale in the global metallurgical markets.
Arch Resources is focused on cash preservation and already took steps to reduce overhead and labor costs significantly and further trim its 2020 maintenance capital budget, which at the midpoint stands at $60 million, down 33% from the midpoint of $90 million of the company's initial 2020 guidance issued in February.
Financial Highlights
Cash and cash equivalents as of Jun 30, 2020 were $150 million compared with $153.1 million at the end of 2019.
Long-term debt as of Jun 30, 2020 was $323.9 million compared with $290.1 million at the end of 2019.
Cash provided by operating activities in first-half 2020 was $25.9 million compared with $225.9 million in the year-ago period.
Guidance
Arch Resources expects coking coal volume and total sales volume for 2020 to be 5.9 and 67.8 million tons, respectively.
Zacks Rank
Arch Resources currently carries a Zacks Rank #5 (Strong Sell).
SunCoke Energy (SXC - Free Report) is scheduled to report second-quarter 2020 results on Aug 3. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is pegged at 1 cent per share.
CONSOL Coal Resources LP is set to report second-quarter 2020 results on Aug 10. The Zacks Consensus Estimate for the to-be-reported quarter’s bottom line is pegged at a loss of 7 cents per share.
CONSOL Energy Inc. (CEIX - Free Report) is slated to report second-quarter 2020 results on Aug 10. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is pegged at a loss of 30 cents per share.
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Arch Resources (ARCH) Q2 Loss Wider Than Expected, Sales Top
Arch Resources Inc. (ARCH - Free Report) reported second-quarter 2020 operating loss of $3.26 per share, wider than the Zacks Consensus Estimate of a loss of $3.22. In the year-ago quarter, however, the company reported earnings of $3.53 per share.
Total Revenues
Total revenues amounted to $319.5 million, which beat the Zacks Consensus Estimate of $266 million by 20.1%.
Segment Details
In the Metallurgical segment, the company sold 1.5 million tons of coal, down 21% from the prior-year figure of 1.9 million tons. It recorded cash margins of $14.22 per ton compared with $53.80 in the year-ago quarter due to lower sales price.
During the quarter, the Powder River Basin segment’s cash margin per ton was (56 cents) versus 79 cents in the prior-year period. The company sold 10.6 million tons, down from the year-ago figure of 17.1 million tons.
In the Other Thermal segment, its cash margin was ($5.56) per ton versus $5.47 in the prior-year period. Shipments also declined 47.4% year over year to 1 million tons.
Arch Resources Inc. Price, Consensus and EPS Surprise
Arch Resources Inc. price-consensus-eps-surprise-chart | Arch Resources Inc. Quote
Highlights of the Release
During the second quarter, Arch Resources invested $46 million in the Leer South mine development and expects to pump more capital between $360 million and $390 million into the project for its completion. As of Jun 30, 2020, the company invested $211 million in the project. It is on track to commence longwall operations at the mine in third-quarter 2021. When fully operational, the mine is expected to produce up to four million tons of High-Vol A coking coal annually for sale in the global metallurgical markets.
Arch Resources is focused on cash preservation and already took steps to reduce overhead and labor costs significantly and further trim its 2020 maintenance capital budget, which at the midpoint stands at $60 million, down 33% from the midpoint of $90 million of the company's initial 2020 guidance issued in February.
Financial Highlights
Cash and cash equivalents as of Jun 30, 2020 were $150 million compared with $153.1 million at the end of 2019.
Long-term debt as of Jun 30, 2020 was $323.9 million compared with $290.1 million at the end of 2019.
Cash provided by operating activities in first-half 2020 was $25.9 million compared with $225.9 million in the year-ago period.
Guidance
Arch Resources expects coking coal volume and total sales volume for 2020 to be 5.9 and 67.8 million tons, respectively.
Zacks Rank
Arch Resources currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
SunCoke Energy (SXC - Free Report) is scheduled to report second-quarter 2020 results on Aug 3. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is pegged at 1 cent per share.
CONSOL Coal Resources LP is set to report second-quarter 2020 results on Aug 10. The Zacks Consensus Estimate for the to-be-reported quarter’s bottom line is pegged at a loss of 7 cents per share.
CONSOL Energy Inc. (CEIX - Free Report) is slated to report second-quarter 2020 results on Aug 10. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is pegged at a loss of 30 cents per share.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>