Alliance Resource Partners, L.P. (NASDAQ: ARLP), a prominent player in the coal and oil & gas industries, has reported robust financial and operational results for the first quarter of 2024. Demonstrating resilience and growth, the company announced increased coal sales volumes, record oil & gas royalty volumes, and a commendable total revenue, alongside a significant net income and EBITDA.
Key highlights from the report include a 2.4% year-over-year increase in coal sales volumes, reaching 8.7 million tons, and an 18.3% increase in oil & gas royalty volumes to 898 MBOE. The first quarter of 2024 saw total revenues touching $651.7 million, with net income at $158.1 million and EBITDA standing at $235.0 million.
ARLP has also fortified its liquidity position to $551.3 million, which includes a solid cash balance and substantial available borrowings under credit facilities. The financial discipline and strategic operations have enabled the company to declare a generous quarterly cash distribution of $0.70 per unit.
Despite a slight decrease in total revenues compared to the first quarter of 2023, primarily due to lower average coal sales prices, the company saw a sequential increase in revenues from the last quarter of 2023, bolstered by higher coal sales prices. Net income and EBITDA for the first quarter also reflected a substantial increase from the sequential quarter, highlighting ARLP’s operational efficiency and market adaptability.
Joseph W. Craft III, the Chairman, President, and CEO of ARLP, commented on the company’s solid operational start to the year, attributing success to the strong performance of mines and the Oil & Gas Royalties segment. The company’s contracted coal position played a pivotal role in mitigating the impacts of mild winter weather and low natural gas prices. Looking forward, Craft emphasized the company’s commitment to maintaining flexible, uncontracted tonnage to cater to market demands, both domestically and internationally.
In terms of operations, the Illinois Basin saw an increase in coal sales prices, while Appalachian prices experienced a dip due to reduced domestic pricing from the Tunnel Ridge mine. However, an uptick in sales from the Illinois Basin’s Hamilton and Warrior mines and Appalachia’s Mettiki operation marked a positive trend in volumes sold.
The Oil & Gas Royalties segment enjoyed increased drilling and completion activities, along with acquisitions of additional mineral interests, contributing to the segment’s record volumes. The Coal Royalties segment also reported improved results due to higher average royalty rates and increased sold tons.
ARLP’s balance sheet remains strong, with manageable debt levels and a robust liquidity position, including a significant increase in the accounts receivable securitization facility and a new term loan to facilitate capital management.
Distribution to unitholders remained steady, aligning with the company’s historical distribution patterns. ARLP’s outlook for the year is optimistic, with expectations that the increasing electricity demand will bolster the coal market, especially given the company’s strategic investments positioning it as a low-cost, reliable provider.
The company’s forward-looking statements point to a confidence in coal’s enduring role in a reliable and affordable energy grid, setting a strategic course for continued growth and shareholder value creation in an evolving energy market.
By Coal Newswire, AI generated
