4Q revenues drop at Alliance Resource Partners

 

Alliance Resource Partners in Tulsa had some disappointing fourth quarter results as total revenue fell nearly 6% compared to a year ago. But growing energy conditions also give optimism at the company’s leadership.

The coal-company’s revenue decreased 5.6% to $590.1 million compared to $625.4 million for the 2023 Quarter primarily as a result of reduced coal sales volumes, which declined 2.3%, and lower transportation revenues. Net income for the 2024 Quarter was $16.3 million, or $0.12 per basic and diluted limited partner unit, compared to $115.4 million, or $0.88 per basic and diluted limited partner unit, for the 2023 Quarter as a result of lower revenues and higher per ton operating expenses.

Compared to the third quarter of 2024, the fourth quarter total revenues were down 3.8%. The third quarter revenues had totaled $613.6 million and the drop, according to the company release, was due to reduce coal sales prices which were down 5.7%. Net income for the 2024 Quarter decreased by 81.1% compared to the Sequential Quarter. Adjusted EBITDA for the 2024 Quarter decreased 27.2% compared to the Sequential Quarter, as a result of higher non-cash accruals for certain long-term liabilities in the Illinois Basin, higher expenses related to the continuation of challenging geological conditions at our Tunnel
Ridge and MC Mining operations in Appalachia, and lower revenue per ton for spot coal sold and per BOE in the Royalties segment.

Alliance recorded full year 2024 total revenue of $2.4 billion, net income of $360.9 million, and Adjusted EBITDA of $714.2 million. It also recorded full year 2024 oil & gas voyalty volumes of 3.4 million BOE, an increase of 9.6% year over year. Alliance also completed $9.6 million in oil and gas mineral interest acquisitions during the fourth quarter.

“Due to the continued strength of our coal contracts, our average coal sales price per ton for the 2024 Full Year of $63.38 came close to the record level achieved in the 2023 Full Year of $64.17. However, lower sales volumes, higher operating costs and several non-cash accruals caused 2024 Full Year financial results to fall short of last year’s record revenues and net income,” said Joseph W. Craft III, Chairman, President and CEO.

“The cold winter weather at the start of this year has driven higher natural gas prices and increased coal consumption in the eastern United States, helping reduce inventories. We are seeing customer solicitations for both near-term and long-term supply contracts, and if the colder weather continues to be above normal, we are hopeful we can reach our goal to ship 30 million tons to the domestic market in 2025.”

Looking ahead, Craft said the combination of cold winter weather and new LNG export terminal capacity should support strong domestic natural gas prices in 2025, something that should benefit Alliance’s coal and royalties segments.

“The increase in forecasted electricity demand, particularly from data centers and growth in AI, is highlighting the inadequacy of current resource plans without extended use of fossil fuel plants. These market realities, coupled with what we expect to be a more favorable regulatory environment, are laying the foundation for Alliance to continue serving as a cornerstone of the country’s reliable electricity infrastructure for years to come. We look forward to what we can achieve in 2025.”