CANONSBURG, Pa., July 14, 2020 /PRNewswire/ -- CONSOL Energy
Inc. (NYSE: CEIX) and CONSOL Coal Resources LP (NYSE: CCR) today
provided an update on their second quarter 2020 operational
performance and cash management efforts as well as their ongoing
response to the COVID-19 pandemic.
CEIX implemented several operating protocols at its mine sites
to reduce the risk of spread of COVID-19, including increased
sanitation efforts and idling mine locations if needed. Given the
significant reduction in US and global economic activity, several
of our customers deferred tonnage and/or partially bought out of
their contracted positions. As a result, we ended the second
quarter of 2020 with sales of 2.3 million tons (CCR's share of 0.6
million tons). In response to the decrease in demand for coal, the
company took several steps to minimize its cash burn, as several of
our customers have been negatively impacted by the effects of the
COVID-19 pandemic. The Enlow Fork mine was largely idled during the
second quarter, and the Bailey mine ran at a significantly reduced
capacity. We completed contract buyouts of $30.1 million (CCR's share of $7.5 million) in the second quarter of 2020,
which brings our year-to-date contract buyout total to $41.0 million (CCR's share of $10.2 million), as of June
30, 2020. We continue to work very closely with our
customers to manage this unprecedented demand decline.
On the cash management front, CEIX ended the second quarter of
2020 with approximately $33 million
of cash and cash equivalents on hand, compared to $78 million at the end of the first quarter of
2020. We also do not have any borrowings (excluding letters of
credit) on our $400 million credit
facility. Notable cash outflows during the quarter included
approximately $19 million in cash
interest payments (including semi-annual payment of approximately
$10 million for our Second Lien),
approximately $14 million in
mandatory payments on our Term Loan A, Term Loan B and finance
leases and approximately $8 million
in transaction costs related to the recently completed amendment on
our credit agreement.
"Despite the continued challenges for the coal markets in the
second quarter, we are encouraged by recent trends in the
marketplace," said Jimmy Brock,
President and Chief Executive Officer of CONSOL Energy Inc. "As of
now, we believe that May was the bottom for our coal shipments.
June shipments were improved compared to May, and month-to-date
July shipments indicate a significant improvement compared to June.
Earlier this week, we also brought back one longwall at our Enlow
Fork mine and are running the Bailey mine at a reduced capacity.
Throughout the recent turmoil, I continue to be extremely impressed
with the resilience of our team. We've adjusted our operating
schedules to better align with market demand, reduced spending at
both the operation and corporate levels, successfully negotiated
multiple contract buyouts and amended our $400 million revolving credit facility in the
second quarter to maintain access to liquidity. During these
challenging times, we remain focused on protecting our balance
sheet and liquidity."
About CONSOL Energy Inc.
CONSOL Energy Inc. (NYSE: CEIX) is a Canonsburg, Pennsylvania-based producer and
exporter of high-Btu bituminous thermal and crossover metallurgical
coal. It owns and operates some of the most productive longwall
mining operations in the Northern Appalachian Basin. Our flagship
operation is the Pennsylvania Mining Complex, which has the
capacity to produce approximately 28.5 million tons of coal per
year and is comprised of 3 large-scale underground mines:
Bailey, Enlow Fork, and Harvey. The company also owns and operates
the CONSOL Marine Terminal, which is located in the port of
Baltimore and has a throughput
capacity of approximately 15 million tons per year. In addition to
the ~669 million reserve tons associated with the Pennsylvania
Mining Complex and the ~21 million reserve tons associated with the
Itmann project, the company also controls approximately 1.5 billion
tons of greenfield thermal and metallurgical coal reserves located
in the major coal-producing basins of the eastern United States. Additional information
regarding CONSOL Energy may be found at www.consolenergy.com.
About CONSOL Coal Resources LP
CONSOL Coal Resources (NYSE: CCR) is a master limited
partnership formed in 2015 to manage and further develop all of
CONSOL Energy Inc.'s (NYSE: CEIX) active coal operations in
Pennsylvania. CCR's assets include a 25% undivided interest
in, and operational control over, the Pennsylvania Mining
Complex, which consists of three underground mines - Bailey, Enlow
Fork and Harvey - and related infrastructure. For its ownership
interest, CCR has an effective annual production capacity of 7.1
million tons of high Btu North Appalachian thermal coal. More
information is available on our website www.ccrlp.com.
Contacts:
Investor:
Nathan Tucker, (724) 416-8336
nathantucker@consolenergy.com
Media:
Zach Smith, (724) 416-8291
zacherysmith@consolenergy.com
Cautionary Statement Regarding Forward-Looking
Statements
Certain statements in this press release are "forward-looking
statements" within the meaning of the federal securities laws. With
the exception of historical matters, the matters discussed in this
press release are forward-looking statements (as defined in Section
21E of the Securities Exchange Act of 1934, as amended) that
involve risks and uncertainties that could cause actual results to
differ materially from projected results. Accordingly, investors
should not place undue reliance on forward-looking statements as a
prediction of actual results. The forward-looking statements may
include projections and estimates concerning the timing and success
of specific projects and our future production, revenues, income
and capital spending. When we use the words "anticipate,"
"believe," "could," "continue," "estimate," "expect," "intend,"
"may," "plan," "predict," "project," "should," "will," or their
negatives, or other similar expressions, the statements which
include those words are usually forward-looking statements. When we
describe strategy that involves risks or uncertainties, we are
making forward-looking statements. We have based these
forward-looking statements on our current expectations and
assumptions about future events. While our management considers
these expectations and assumptions to be reasonable, they are
inherently subject to significant business, economic, competitive,
regulatory and other risks, contingencies and uncertainties, most
of which are difficult to predict and many of which are beyond our
control. Specific risks, contingencies and uncertainties are
discussed in more detail in our filings with the Securities and
Exchange Commission. The forward-looking statements in this press
release speak only as of the date of this press release and CEIX
disclaims any intention or obligation to update publicly any
forward-looking statements, whether in response to new information,
future events, or otherwise, except as required by applicable
law.
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SOURCE CONSOL Energy Inc.; CONSOL Coal Resources LP
