BIRMINGHAM, AL, Mar 26, 2012 (MARKETWIRE via COMTEX) --Walter Energy, Inc. (NYSE: WLT) (TSX: WLT), the world's leading,
publicly traded pure-play producer of metallurgical (met) coal for
global industry, today provided an outlook on first quarter
performance and reaffirmed full-year metallurgical coal production
guidance.
"Compared with the fourth quarter of 2011, we expect strong
production growth, but revenue and profitability will be
disappointing due to flat sales volume and weaker coal prices
experienced across the industry in the first quarter of 2012," said
Walt Scheller, Chief Executive Officer. "We remain confident that
production will be within the guidance provided for 2012, and we
continue to take steps to optimize production at our highest-margin
mines to help offset weakening global metallurgical coal prices."
Production Outlook
Walter Energy expects met coal production in the range of 2.8 million
to 2.9 million metric tons (MMTs) for the first quarter of 2012, up
16% to 21% from 2.4 million MMTs in the fourth quarter of 2011.
Walter Energy continues to expect 2012 full-year met coal production
between 11.5 MMTs and 13 MMTs, with approximately 75% of annual
production being high-margin hard coking coal (HCC) and 25%
pulverized coal injection (PCI).
To support margins, beginning in the second quarter 2012 Walter
Energy will decrease production from its lower-margin Maple
underground coal mine in West Virginia by approximately 35% due to
market conditions for Maple's production. The reduction will be
offset in part by increased output of higher-margin HCC from Alabama
and Canada.
The Maple underground coal mine produces about 60,000 metric tons
(MTs) of high-volatile (vol) met coal each month and has about 230
employees, most of whom will remain with Walter Energy at Maple and
other locations. The production decrease will effectively idle the
Maple mine for approximately 10 days per month. Walter Energy will
continue to monitor market demand for high-vol products and may
further adjust production to reflect market conditions.
Sales Volume and Price Outlook
First quarter 2012 met coal sales volume will likely remain unchanged
from the fourth quarter last year at 2.4 MMTs. Walter Energy expects
approximately 240,000 MTs of first quarter 2012 production to be
shipped to customers early in the second quarter due to shipload
scheduling and customer preference.
Reflecting current trends in global coal markets, Walter Energy's met
coal prices for the first quarter of 2012 will likely average about
$220 per MT for HCC and $180 per MT for low-vol PCI. That represents
a decline of approximately 10% for HCC and approximately 15% for
low-vol PCI coal from the fourth quarter of last year, inclusive of
the impact of carryover tons from past quarters.
About Walter Energy
Walter Energy is the world's leading, publicly traded pure-play
metallurgical coal producer for global industry with strategic access
to high-growth steel markets in Asia, South America and Europe. The
Company also produces thermal coal, anthracite, metallurgical coke
and coal bed methane gas. Walter Energy employs approximately 4,400
employees and contractors with operations in the United States,
Canada and United Kingdom. For more information about Walter Energy,
please visit www.walterenergy.com.
Safe Harbor Statement
Except for historical information contained herein, the statements in
this release are forward-looking and made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995
and may involve a number of risks and uncertainties. Forward-looking
statements are based on information available to management at the
time, and they involve judgments and estimates. Forward-looking
statements include expressions such as "believe," "anticipate,"
"expect," "estimate," "intend," "may," "plan," "predict," "will," and
similar terms and expressions. These forward-looking statements are
made based on expectations and beliefs concerning future events
affecting us and are subject to various risks, uncertainties and
factors relating to our operations and business environment, all of
which are difficult to predict and many of which are beyond our
control, that could cause our actual results to differ materially
from those matters expressed in or implied by these forward-looking
statements. The following factors are among those that may cause
actual results to differ materially from our forward-looking
statements: the market demand for coal, coke and natural gas as well
as changes in pricing and costs; the availability of raw material,
labor, equipment and transportation; changes in weather and geologic
conditions; changes in extraction costs, pricing and assumptions and
projections concerning reserves in our mining operations; changes in
customer orders; pricing actions by our competitors, customers,
suppliers and contractors; changes in governmental policies and laws,
including with respect to safety enhancements and environmental
initiatives; availability and costs of credit, surety bonds and
letters of credit; and changes in general economic conditions.
Forward-looking statements made by us in this release, or elsewhere,
speak only as of the date on which the statements were made. See also
the "Risk Factors" in our 2011 Annual Report on Form 10-K and
subsequent filings with the SEC, which are currently available on our
website at www.walterenergy.com. New risks and uncertainties arise
from time to time, and it is impossible for us to predict these
events or how they may affect us or our anticipated results. We have
no duty to, and do not intend to, update or revise the
forward-looking statements in this release, except as may be required
by law. In light of these risks and uncertainties, readers should
keep in mind that any forward-looking statement made in this press
release may not occur. All data presented herein is as of the date of
this release unless otherwise noted.
Investor Relations Contact:
Paul Blalock
Vice President, Investor Relations
205.745.2627
paul.blalock@walterenergy.com
SOURCE: Walter Energy
mailto:paul.blalock@walterenergy.com
