COLUMBUS, Ohio, Oct. 30,
2014 /PRNewswire/ -- Oxford Resource Partners, LP
(NYSE: OXF) (the "Partnership" or "Oxford") today announced third
quarter 2014 financial results.
Third Quarter 2014 Results
Adjusted EBITDA1 was $26.9
million for the third quarter of 2014 compared to
$11.0 million for the third quarter
of 2013. The increase was driven by $19.5
million of legal settlement proceeds received in the third
quarter of 2014, compensating the Partnership for lost profits on
coal sales resulting from the wrongful termination of a coal supply
agreement with a former customer. Cash coal sales revenue
increased 2.8 percent to $52.16 per
ton for the third quarter of 2014 from $50.74 per ton for the third quarter of 2013. For
the third quarter of 2014, cash cost of coal sales increased by 4.4
percent to $46.29 per ton from
$44.34 per ton for the third quarter
of 2013, primarily due to lower volume and higher costs of
transportation, diesel fuel and employee compensation. Cash margins
decreased 8.3 percent to $5.87 per
ton for the third quarter of 2014 from $6.40 per ton for the third quarter of
2013.
Net income was $9.4 million for
the third quarter of 2014 compared to a net loss of $5.1 million for the third quarter of 2013.
Adjusted Net Loss2 was $10.3
million for the third quarter of 2014, when excluding the
$19.5 million in proceeds
representing lost profits on coal sales, and a $0.2 million gain relating to the change in fair
value of warrants. Adjusted Net Loss was $10.1 million for the third quarter of 2013, when
excluding a $2.7 million gain
relating to the change in fair value of warrants, $1.3 million in lost profits on coal sales
proceeds, a $1.1 million gain on
disposal of assets, and $0.2 million
of restructuring expenses.
"The mild summer weather adversely impacted our third quarter
sales results. Customer stockpiles have been near capacity,
resulting in delayed shipments," said Oxford's President and Chief
Executive Officer, Charles C.
Ungurean. "We anticipate that volumes will return to more
normal levels in the fourth quarter."
"Oxford is very excited about the recently announced
transactions with Westmoreland Coal Company," Ungurean continued.
"Their proposed acquisition of our general partner and a
substantial percentage of our limited partnership, together with
our restructuring and Westmoreland's contribution of revenue
enhancing assets, will create significant opportunities for our
public unitholders, including the reinstatement of cash
distributions. Oxford will become the MLP vehicle for Westmoreland,
to which it intends to continue to contribute MLP-appropriate
assets, allowing Westmoreland to realize additional value for its
shareholders as well. This is a great opportunity for both
companies and we are thrilled to be joining with Westmoreland."
1The definition of Adjusted EBITDA, which is a
non-GAAP financial measure, and a reconciliation thereof to Net
Loss, the most comparable GAAP financial measure, are included in a
table presented near the end of this press release.
2 The definition of Adjusted Net Loss,
which is a non-GAAP financial measure, and a reconciliation thereof
to Net Loss, the most comparable GAAP financial measure, are
included in a table presented near the end of this press
release.
Business Update
Oxford's projected sales volume is 96.8 percent committed and
priced for the balance of 2014, underscoring the strength of its
long-term customer relationships and its strategic importance in
its core region. Oxford has the ability to increase annual
production by up to 0.5 million tons with little additional capital
investment if additional demand materializes. For 2015, projected
sales volume is 69.2 percent committed (with 21.4 percent of the
projected sales volume priced and 47.8 percent of the projected
sales volume unpriced).
Westmoreland Transactions
On October 16,
2014, Westmoreland Coal Company (NasdaqGM: WLB,
"Westmoreland"), the Partnership and the Partnership's general
partner, Oxford Resources GP, LLC ("Oxford GP"), announced that
Westmoreland will acquire Oxford GP and contribute certain royalty
bearing coal reserves to the Partnership in return for common units
of the Partnership. As a result, the Partnership intends to resume
quarterly distributions at $0.20 per
common unit (after a 12-to-1 reverse split) and refinance its
existing credit facilities on better terms, including terms that
allow for distributions to unitholders and additional credit
capacity to fund future acquisitions. Certain lenders have
agreed to provide a new credit facility for Oxford that will
refinance all of Oxford's existing debt on that basis. There will
also be a one-time special distribution to the common unitholders
of Oxford excluding AIM, C&T, the Warrantholders and
Westmoreland. The distribution will be made to such common
unitholders, on a pro rata basis, and will consist of an
approximately 25% "unit dividend" of an aggregate of 202,184
additional post-reverse split common units. Following these
transactions, the Partnership will continue to operate as a
stand-alone, publicly-traded master limited partnership (MLP) and
Westmoreland will own 77% of the fully diluted limited partner
interests in the Partnership.
The transactions involving the Partnership must be approved by a
majority of the outstanding Oxford common units that are not owned
by Oxford GP and its affiliates and by a majority of the
outstanding subordinated units. The Partnership has filed a
proxy statement with the SEC for review and it is anticipated that
the unitholder vote will be held in December. Upon receiving
unitholder approval, all of the transactions are expected to be
closed concurrent with the debt refinancing. It is
anticipated that the transactions will be completed during the
fourth quarter of 2014.
Subsequent Event
The Partnership's wholly owned subsidiary, Oxford Mining
Company, LLC ("OMC"), entered into an agreement with Harrison
Resources, LLC ("Harrison") and CONSOL of Ohio LLC ("CONSOL") under
which Harrison redeemed all of CONSOL's interest in Harrison.
Harrison had been a joint venture owned 51% by OMC and 49% by
CONSOL, and as a result of the redemption OMC owns 100% of
Harrison. Harrison acquired 876,000 tons of coal reserves
from a CONSOL affiliate, and also options to purchase an aggregate
of 5.6 million additional tons of coal reserves from a CONSOL
affiliate. These tons are in addition to the 1.7 million tons of
coal reserves already owned by Harrison. These transactions were
effective as of October 1, 2014.
Liquidity
In August 2014, Oxford received
legal settlement proceeds of $19.5
million, compensating the Partnership for lost profits on
coal sales from the wrongful termination of a coal supply agreement
with a former customer. Concurrently, Oxford amended the first lien
credit facility term loan to allow the Partnership to retain
$5.0 million of the proceeds in
addition to the $1.9 million of
professional fees and other collection costs recovered, thus
enhancing liquidity by $6.9 million.
Pursuant to the Financing Agreements, as amended, the balance of
the proceeds, or $12.6 million, was
used to make a prepayment of principal on the Partnership's first
lien debt.
As of September 30, 2014, the
Partnership had $7.5 million in cash
and $6.7 million in available
borrowing capacity on its revolving credit line. Additionally,
Oxford has an option under the second lien credit facility for an
additional $10 million term loan if
requested and approved by the issuing second lien lender.
2014 Guidance
The Partnership provides the following updated guidance for 2014
based on its current industry outlook:
The Partnership expects to produce between 5.6 million tons and
5.7 million tons and sell between 5.7 million tons and 5.8 million
tons of thermal coal. The average selling price is anticipated to
be in the range of $52.25 per ton to
$52.75 per ton, with an anticipated
average cost in the range of $45.35
per ton to $45.85 per ton.
Adjusted EBITDA is expected to be in the range of $53.5 million to $56.5 million, including the
$19.5 million of legal settlement
proceeds representing lost profits on coal sales from the wrongful
termination of a coal supply agreement with a former customer.
The Partnership anticipates capital expenditures of between
$19.0 million and $20.0 million.
Conference Call
The Partnership will host a conference call at 10:00 a.m. Eastern Time today (October 30,
2014) to review its third quarter 2014 financial results. To
participate in the call, dial (877) 703-6107 or (857) 244-7306 for
international callers and provide passcode 27795081. The call
will also be webcast live on the Internet in the Investor Relations
section of the Partnership's website at
www.OxfordResources.com.
An audio replay of the conference call will be available for
seven days beginning at 3:00 p.m. Eastern
Time on October 30, 2014, and may be accessed at (888)
286-8010 or (617) 801-6888 for international callers. The
replay passcode is 16839862. The webcast will also be
archived on the Partnership's website at www.OxfordResources.com
for 30 days following the call.
About Oxford Resource Partners, LP
Oxford Resource Partners, LP is a low-cost producer of
high-value thermal coal in Northern Appalachia. Oxford
markets its coal primarily to large electric utilities with
coal-fired, base-load scrubbed power plants under long-term coal
sales contracts. The Partnership is headquartered in
Columbus, Ohio.
For more information about Oxford Resource Partners, LP (NYSE:
OXF), please visit www.OxfordResources.com. Financial and
other information about the Partnership is routinely posted on and
accessible at www.OxfordResources.com.
Forward-Looking Statements
Except for historical information, statements made in this press
release are "forward-looking statements." All statements,
other than statements of historical facts, included in this press
release that address activities, events or developments that the
Partnership expects, believes or anticipates will or may occur in
the future are forward-looking statements, including the statements
and information set forth under the headings "Business Update,"
"Westmoreland Transactions," "Subsequent Event," "Liquidity" and
"2014 Guidance."
These statements are based on certain assumptions made by the
Partnership based on its management's experience and perception of
historical trends, current conditions, expected future developments
and other factors the Partnership's management believes are
appropriate under the circumstances. Such statements are subject to
a number of assumptions, risks and uncertainties, many of which are
beyond the Partnership's control, which may cause actual results to
differ materially from those implied or expressed by the
forward-looking statements. These risks, uncertainties and
contingencies include, but are not limited to, the following:
productivity levels, margins earned and the level of operating
costs; weakness in global economic conditions or in customers'
industries; changes in governmental regulation of the mining
industry or the electric power industry and the increased costs of
complying with those changes; decreases in demand for electricity
and changes in coal consumption patterns of U.S. electric power
generators; the Partnership's dependence on a limited number of
customers; the Partnership's inability to enter into new long-term
coal sales contracts at attractive prices and the renewal and other
risks associated with the Partnership's existing long-term coal
sales contracts, including risks related to adjustments to price,
volume or other terms of those contracts; difficulties in
collecting the Partnership's receivables because of credit or
financial problems of major customers, and customer bankruptcies,
cancellations or breaches to existing contracts or other failures
to perform; the Partnership's ability to acquire additional coal
reserves; the Partnership's ability to respond to increased
competition within the coal industry; fluctuations in coal demand,
prices and availability due to labor and transportation costs and
disruptions, equipment availability, governmental regulations,
including those pertaining to carbon dioxide emissions, and other
factors; significant costs imposed on the Partnership's mining
operations by extensive and frequently changing environmental laws
and regulations, and greater than expected environmental
regulations, costs and liabilities; legislation and regulatory and
related judicial decisions and interpretations including issues
pertaining to climate change and miner health and safety; a variety
of operational, geologic, permitting, labor and weather-related
factors, including those pertaining to both mining operations and
underground coal reserves that the Partnership does not operate;
the potential for inaccuracies in estimates of the Partnership's
coal reserves, which could result in lower than expected revenues
or higher than expected costs; the accuracy of the assumptions
underlying the Partnership's reclamation and mine closure
obligations; liquidity constraints, including those resulting from
the cost or unavailability of financing due to current capital
markets conditions; risks associated with major mine-related
accidents; results of litigation, including claims not yet
asserted; the Partnership's ability to attract and retain key
management personnel; greater than expected shortage of skilled
labor; the Partnership's ability to maintain satisfactory relations
with employees; and failure to obtain, maintain or renew security
arrangements, such as surety bonds or letters of credit, in a
timely manner and on acceptable terms.
The Partnership undertakes no obligation to publicly update or
revise any forward-looking statements. Readers should not place
undue reliance on forward-looking statements, which reflect
management's views only as of the date hereof. Further
information on risks and uncertainties is available in the
Partnership's periodic reports filed with the U.S. Securities and
Exchange Commission or otherwise publicly disseminated by the
Partnership.
Withholding Information for Foreign Investors
This announcement is intended to be a qualified notice under
Treasury Regulation Section 1.1446-4(b). Brokers and nominees
should treat one hundred percent (100.0%) of Partnership
distributions to foreign investors, when and if such distributions
are made, as being attributable to income that is effectively
connected with a United States
trade or business. Accordingly, Partnership distributions to
foreign investors would be subject to federal income tax
withholding at the highest applicable rate.
OXFORD RESOURCE
PARTNERS, LP AND SUBSIDIARIES
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
FOR THE THREE AND
NINE MONTHS ENDED SEPTEMBER 30, 2014 AND 2013
|
(in thousands,
except for unit data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
|
|
Coal sales
|
$
|
73,112
|
|
|
$
|
84,742
|
|
|
$
|
229,468
|
|
|
$
|
255,226
|
|
Other
revenue
|
21,395
|
|
|
2,844
|
|
|
25,044
|
|
|
9,211
|
|
Total
revenues
|
94,507
|
|
|
87,586
|
|
|
254,512
|
|
|
264,437
|
|
COSTS AND
EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
Cost of coal
sales:
|
|
|
|
|
|
|
|
|
|
|
|
Produced
coal
|
64,592
|
|
|
68,175
|
|
|
196,326
|
|
|
202,159
|
|
Purchased
coal
|
300
|
|
|
5,881
|
|
|
1,587
|
|
|
17,774
|
|
Total cost of coal
sales (excluding depreciation, depletion and
amortization)
|
64,892
|
|
|
74,056
|
|
|
197,913
|
|
|
219,933
|
|
Cost of other
revenue
|
542
|
|
|
455
|
|
|
1,313
|
|
|
1,228
|
|
Depreciation,
depletion and amortization
|
9,236
|
|
|
12,017
|
|
|
30,532
|
|
|
37,760
|
|
Selling, general and
administrative expenses
|
3,604
|
|
|
3,051
|
|
|
10,530
|
|
|
13,056
|
|
Restructuring
expenses
|
—
|
|
|
150
|
|
|
75
|
|
|
1,012
|
|
Gain on disposal of
assets, net
|
—
|
|
|
(1,107)
|
|
|
(559)
|
|
|
(6,594)
|
|
Total costs and
expenses
|
78,274
|
|
|
88,622
|
|
|
239,804
|
|
|
266,395
|
|
INCOME (LOSS) FROM
OPERATIONS
|
16,233
|
|
|
(1,036)
|
|
|
14,708
|
|
|
(1,958)
|
|
INTEREST AND OTHER
INCOME (EXPENSES):
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
1
|
|
|
1
|
|
|
4
|
|
|
3
|
|
Interest
expense
|
(7,026)
|
|
|
(6,808)
|
|
|
(20,899)
|
|
|
(14,146)
|
|
Change in fair value
of warrants
|
151
|
|
|
2,714
|
|
|
1,621
|
|
|
565
|
|
Total interest and
other expenses
|
(6,874)
|
|
|
(4,093)
|
|
|
(19,274)
|
|
|
(13,578)
|
|
NET INCOME
(LOSS)
|
9,359
|
|
|
(5,129)
|
|
|
(4,566)
|
|
|
(15,536)
|
|
Net loss (income)
attributable to noncontrolling interest
|
428
|
|
|
(470)
|
|
|
1,270
|
|
|
(1,120)
|
|
Net income (loss)
attributable to Oxford Resource Partners, LP unitholders
|
9,787
|
|
|
(5,599)
|
|
|
(3,296)
|
|
|
(16,656)
|
|
Net income (loss)
allocated to general partner
|
193
|
|
|
(112)
|
|
|
(66)
|
|
|
(333)
|
|
Net income (loss)
allocated to limited partners
|
$
|
9,594
|
|
|
$
|
(5,487)
|
|
|
$
|
(3,230)
|
|
|
$
|
(16,323)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
limited partner unit:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.39
|
|
|
$
|
(0.22)
|
|
|
$
|
(0.13)
|
|
|
$
|
(0.74)
|
|
Diluted
|
0.39
|
|
|
(0.22)
|
|
|
(0.13)
|
|
|
(0.74)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of limited partner units outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
24,778,680
|
|
|
24,587,411
|
|
|
24,717,697
|
|
|
22,159,610
|
|
Diluted
|
24,778,680
|
|
|
24,587,411
|
|
|
24,717,697
|
|
|
22,159,610
|
|
OXFORD RESOURCE
PARTNERS, LP AND SUBSIDIARIES
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
AS OF SEPTEMBER
30, 2014 AND DECEMBER 31, 2013
|
(in thousands,
except for unit data)
|
|
As
of
|
|
As
of
|
|
September
30,
|
|
December
31,
|
|
2014
|
|
2013
|
ASSETS
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
Cash
|
$
|
7,454
|
|
|
$
|
3,089
|
|
Accounts
receivable
|
25,176
|
|
|
25,850
|
|
Inventory
|
15,596
|
|
|
13,840
|
|
Advance
royalties
|
2,940
|
|
|
2,604
|
|
Prepaid expenses and
other assets
|
1,444
|
|
|
1,737
|
|
Total current
assets
|
52,610
|
|
|
47,120
|
|
PROPERTY, PLANT AND
EQUIPMENT, NET
|
125,150
|
|
|
144,426
|
|
ADVANCE ROYALTIES,
LESS CURRENT PORTION
|
6,971
|
|
|
8,800
|
|
INTANGIBLE ASSETS,
NET
|
1,017
|
|
|
1,188
|
|
OTHER LONG-TERM
ASSETS
|
18,237
|
|
|
22,821
|
|
Total
assets
|
$
|
203,985
|
|
|
$
|
224,355
|
|
LIABILITIES AND
PARTNERS' (DEFICIT) CAPITAL
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
Accounts
payable
|
$
|
22,497
|
|
|
$
|
23,932
|
|
Current portion of
long-term debt
|
73,527
|
|
|
7,901
|
|
Current portion of
reclamation and mine closure obligations
|
7,949
|
|
|
5,996
|
|
Accrued taxes other
than income taxes
|
1,041
|
|
|
1,293
|
|
Accrued payroll and
related expenses
|
2,279
|
|
|
3,389
|
|
Other
liabilities
|
2,989
|
|
|
3,457
|
|
Total current
liabilities
|
110,282
|
|
|
45,968
|
|
LONG-TERM
DEBT
|
75,428
|
|
|
155,375
|
|
RECLAMATION AND MINE
CLOSURE OBLIGATIONS
|
25,792
|
|
|
25,658
|
|
WARRANTS
|
2,978
|
|
|
4,599
|
|
OTHER LONG-TERM
LIABILITIES
|
3,737
|
|
|
3,753
|
|
Total
liabilities
|
218,217
|
|
|
235,353
|
|
PARTNERS'
DEFICIT:
|
|
|
|
|
|
Limited partners
(21,055,194 and 20,867,073 units outstanding as of September 30,
2014 and December 31, 2013, respectively)
|
(15,358)
|
|
|
(13,460)
|
|
General partner
(423,494 units outstanding as of September 30, 2014 and December
31, 2013)
|
(2,573)
|
|
|
(2,507)
|
|
Total Oxford Resource
Partners, LP deficit
|
(17,931)
|
|
|
(15,967)
|
|
Noncontrolling
interest
|
3,699
|
|
|
4,969
|
|
Total partners'
deficit
|
(14,232)
|
|
|
(10,998)
|
|
Total liabilities and
partners' deficit
|
$
|
203,985
|
|
|
$
|
224,355
|
|
OXFORD RESOURCE
PARTNERS, LP AND SUBSIDIARIES
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 2014 AND 2013
|
(in
thousands)
|
|
Nine Months
Ended
|
|
September
30,
|
|
2014
|
|
2013
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
|
Net loss
|
$
|
(4,566)
|
|
|
$
|
(15,536)
|
|
Adjustments to
reconcile net loss to net cash from operating
activities:
|
|
|
|
|
|
Depreciation,
depletion and amortization
|
30,532
|
|
|
37,760
|
|
Restructuring
expenses
|
75
|
|
|
1,012
|
|
Change in fair value
of warrants
|
(1,621)
|
|
|
(565)
|
|
Interest rate swap
adjustment to market
|
—
|
|
|
(12)
|
|
Non-cash interest
expense
|
5,770
|
|
|
2,238
|
|
Amortization and
write-off of deferred financing costs
|
3,010
|
|
|
3,040
|
|
Non-cash equity-based
compensation expense
|
1,383
|
|
|
1,090
|
|
Non-cash reclamation
and mine closure expense
|
1,725
|
|
|
1,683
|
|
Amortization of
below-market coal sales contracts
|
—
|
|
|
(60)
|
|
Gain on disposal of
assets, net
|
(559)
|
|
|
(6,594)
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
Accounts
receivable
|
674
|
|
|
(8,697)
|
|
Inventory
|
(1,756)
|
|
|
489
|
|
Advance
royalties
|
1,493
|
|
|
(1,265)
|
|
Restricted
cash
|
1,109
|
|
|
1,429
|
|
Prepaid expenses and
other assets
|
225
|
|
|
(276)
|
|
Accounts
payable
|
(1,435)
|
|
|
(2,561)
|
|
Reclamation and mine
closure obligations
|
(3,376)
|
|
|
(6,837)
|
|
Accrued taxes other
than income taxes
|
(252)
|
|
|
(38)
|
|
Accrued payroll and
related expenses
|
(1,110)
|
|
|
878
|
|
Other
liabilities
|
(608)
|
|
|
(248)
|
|
Net cash from
operating activities
|
30,713
|
|
|
6,930
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
|
Purchase of property
and equipment
|
(8,513)
|
|
|
(12,641)
|
|
Purchase of coal
reserves and land
|
(5)
|
|
|
(14)
|
|
Mine development
costs
|
(1,896)
|
|
|
(2,612)
|
|
Proceeds from sale of
assets
|
3,751
|
|
|
6,284
|
|
Insurance
proceeds
|
—
|
|
|
3,035
|
|
Net cash from
investing activities
|
(6,663)
|
|
|
(5,948)
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
|
Proceeds from
borrowings
|
—
|
|
|
150,000
|
|
Payments on
borrowings
|
(18,626)
|
|
|
(56,071)
|
|
Advances on line of
credit
|
17,500
|
|
|
43,588
|
|
Payments on line of
credit
|
(19,000)
|
|
|
(119,088)
|
|
Debt issuance
costs
|
(341)
|
|
|
(9,517)
|
|
Collateral for
reclamation bonds
|
782
|
|
|
(11,133)
|
|
Net cash from
financing activities
|
(19,685)
|
|
|
(2,221)
|
|
|
|
|
|
|
|
NET CHANGE IN
CASH
|
4,365
|
|
|
(1,239)
|
|
CASH, beginning of
period
|
3,089
|
|
|
3,977
|
|
CASH, end of
period
|
$
|
7,454
|
|
|
$
|
2,738
|
|
OXFORD RESOURCE
PARTNERS, LP AND SUBSIDIARIES
|
UNAUDITED
RECONCILIATION OF NET LOSS TO ADJUSTED
EBITDA1
|
FOR THE THREE AND
NINE MONTHS ENDED SEPTEMBER 30, 2014 AND 2013
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2014
|
|
|
2013
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
9,359
|
|
|
$
|
(5,129)
|
|
|
$
|
(4,566)
|
|
|
$
|
(15,536)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
of interest income
|
7,025
|
|
|
6,807
|
|
|
20,895
|
|
|
14,143
|
|
Depreciation,
depletion and amortization
|
9,236
|
|
|
12,017
|
|
|
30,532
|
|
|
37,760
|
|
Change in fair value
of warrants
|
(151)
|
|
|
(2,714)
|
|
|
(1,621)
|
|
|
(565)
|
|
Restructuring
expenses
|
—
|
|
|
150
|
|
|
75
|
|
|
1,012
|
|
Gain on disposal of
assets, net
|
—
|
|
|
(1,107)
|
|
|
(559)
|
|
|
(6,594)
|
|
Amortization of
below-market coal sales contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
(60)
|
|
Non-cash equity-based
compensation expense
|
462
|
|
|
351
|
|
|
1,383
|
|
|
1,090
|
|
Non-cash reclamation
and mine closure expense
|
600
|
|
|
625
|
|
|
1,725
|
|
|
1,683
|
|
Non-recurring
costs:
|
|
|
|
|
|
|
|
|
|
|
|
Debt refinancing
expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
3,059
|
|
Other
|
336
|
|
|
—
|
|
|
1,204
|
|
|
(2,100)
|
|
Adjusted
EBITDA
|
$
|
26,867
|
|
|
$
|
11,000
|
|
|
$
|
49,068
|
|
|
$
|
33,892
|
|
1
Adjusted EBITDA is a non-GAAP financial measure used by management
to gauge operating performance. We define Adjusted EBITDA as
net income or loss before deducting interest, income taxes,
depreciation, depletion, amortization, change in fair value of
warrants, impairment and restructuring expenses, gain or loss on
disposal of assets, amortization of below-market coal sales
contracts, non-cash equity-based compensation expense, non-cash
reclamation and mine closure expense, and certain non-recurring
revenues and costs. Although Adjusted EBITDA is not a measure
of financial performance calculated in accordance with GAAP, we
believe it is useful to management and others, such as investors
and lenders, in evaluating our financial performance without regard
to our financing methods, capital structure or income taxes; our
ability to generate cash sufficient to pay interest and principal
on our indebtedness, make distributions and fund capital
expenditures; and our compliance with certain credit facility
financial covenants. Because not all companies calculate
Adjusted EBITDA the same way, our calculation may not be comparable
to similarly titled measures of other companies.
|
OXFORD RESOURCE
PARTNERS, LP AND SUBSIDIARIES
|
UNAUDITED
RECONCILIATION OF NET LOSS TO ADJUSTED NET
LOSS2
|
FOR THE THREE AND
NINE MONTHS ENDED SEPTEMBER 30, 2014 AND 2013
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
9,359
|
|
|
$
|
(5,129)
|
|
|
$
|
(4,566)
|
|
|
$
|
(15,536)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring
expenses
|
—
|
|
|
150
|
|
|
75
|
|
|
1,012
|
|
Gain on disposal of
assets, net
|
—
|
|
|
(1,107)
|
|
|
(559)
|
|
|
(6,594)
|
|
Change in fair value
of warrants
|
(151)
|
|
|
(2,714)
|
|
|
(1,621)
|
|
|
(565)
|
|
Lost profits on coal
sales proceeds
|
(19,500)
|
|
|
(1,317)
|
|
|
(19,500)
|
|
|
(2,439)
|
|
Legal settlement
proceeds
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,100)
|
|
Debt refinancing
expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
3,059
|
|
Write-off of deferred
financing costs related to prior credit facility
|
—
|
|
|
—
|
|
|
—
|
|
|
808
|
|
Adjusted net
income (loss):
|
$
|
(10,292)
|
|
|
$
|
(10,117)
|
|
|
$
|
(26,171)
|
|
|
$
|
(22,355)
|
|
2 Adjusted
Net Loss is a non-GAAP financial measure used by management to
gauge operating performance. We define Adjusted Net Loss as
net income or loss before deducting impairment and restructuring
expenses, gain or loss on disposal of assets, change in fair value
of warrants, legal settlement proceeds and cost, debt financing
expenses and write-off of deferred refinancing costs.
Although Adjusted Net Loss is not a measure of financial
performance calculated in accordance with GAAP, we believe it is
useful to management and others, such as investors and lenders, in
evaluating our financial performance without regard to items which
are primarily non-cash and our restructuring efforts which are not
typical operating activities. Because not all companies
calculate Adjusted Net Loss the same way, our calculation may not
be comparable to similarly titled measures of other
companies.
|
OXFORD RESOURCE
PARTNERS, LP AND SUBSIDIARIES
|
UNAUDITED
OPERATING STATISTICS3
|
FOR THE THREE AND
NINE MONTHS ENDED SEPTEMBER 30, 2014 AND 2013
|
(in thousands,
except per ton amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tons sold
|
1,402
|
|
|
1,670
|
|
|
4,357
|
|
|
5,017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Coal sales revenue
per ton
|
$
|
52.16
|
|
|
$
|
50.74
|
|
|
$
|
52.67
|
|
|
$
|
50.87
|
|
Amortization of
below-market coal sales contracts per ton
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.01)
|
|
Cash coal sales
revenue per ton
|
52.16
|
|
|
50.74
|
|
|
52.67
|
|
|
50.86
|
|
Cash cost of coal
sales per ton
|
(46.29)
|
|
|
(44.34)
|
|
|
(45.43)
|
|
|
(43.84)
|
|
Cash margin per
ton
|
$
|
5.87
|
|
|
$
|
6.40
|
|
|
$
|
7.24
|
|
|
$
|
7.02
|
|
3 Per ton
amounts are calculated by dividing the related amount on the
financial statements by the number of tons sold. Although per
ton amounts are not measures of performance calculated in
accordance with GAAP, we believe they are useful to management and
others, such as investors and lenders, in evaluating performance
because they are widely used in the coal industry as a measure to
evaluate a company's sales performance and control over
costs. Because not all companies calculate these measures the
same way, our calculations may not be comparable to similarly
titled measures of other companies.
|
SOURCE Oxford Resource Partners, LP