Alliance Holdings GP, L.P. Reports Quarterly Financial Results; Declares Quarterly Distribution of $0.55 Per Unit
Alliance Holdings GP, L.P. (NASDAQ: AHGP) today reported financial
results for the quarter ended March 31, 2017 (the "2017 Quarter") and,
as previously announced, the Board of Directors of its general partner
(the "Board") approved a distribution to unitholders of $0.55 per unit
(an annualized rate of $2.20 per unit) for the 2017 Quarter. The
announced distribution is payable on May 19, 2017 to AHGP's unitholders
of record as of the close of trading on May 12, 2017 and is equal to the
distributions declared for the quarters ended March 31, 2016 (the "2016
Quarter") and December 31, 2016.
AHGP's principal sources of cash flow are its ownership of general
partner interests, limited partner interests and incentive distribution
rights in Alliance Resource Partners, L.P. (NASDAQ: ARLP). The declared
distribution is based on the distribution AHGP will receive from its
ownership interests in ARLP, which previously announced a quarterly
distribution for the 2017 Quarter of $0.4375 per unit, or $1.75 per unit
on an annualized basis, payable on May 15, 2017 to all unitholders of
record as of the close of trading on May 8, 2017. (See ARLP Press
Release dated April 28, 2017.)
AHGP also reported net income attributable to AHGP for the 2017 Quarter
of $55.0 million, or $0.92 per basic and diluted limited partner unit,
an increase of 78.4% compared to $30.8 million, or $0.52 per basic and
diluted limited partner unit for the 2016 Quarter.
Operating results for AHGP reflect those of the operating subsidiaries
of ARLP and, as a result, AHGP reports its financial results on a
consolidated basis with the financial results of ARLP. The consolidated
net income of AHGP includes earnings and losses attributable to both
AHGP and noncontrolling interests.
Based on ARLP's current declared distribution, AHGP expects to receive
quarterly cash distributions from ARLP of $33.5 million, or $134.0
million on an annualized basis. AHGP's primary cash requirements are for
working capital, distributions to its unitholders and, for the 2017 full
year, an estimated $2.0 million in general and administrative expenses.
A joint conference call regarding AHGP and ARLP’s 2017 Quarter financial
results is scheduled for today at 10:00 a.m. Eastern. To participate in
the conference call, dial (855) 793-3259 and provide conference number
4320772. International callers should dial (631) 485-4928 and provide
the same conference number. Investors may also listen to the call via
the "investor information" section of ARLP's website at http://www.arlp.com
or AHGP's website at http://www.ahgp.com.
An audio replay of the conference call will be available for
approximately one week. To access the audio replay, dial (855) 859-2056
and provide conference number 4320772. International callers should dial
(404) 537-3406 and provide the same conference number.
About Alliance Holdings GP, L.P.
AHGP is a limited partnership formed to own and control Alliance
Resource Management GP, LLC, the managing general partner of ARLP,
through which it holds a 1.98% general partner interest and the
incentive distribution rights in ARLP. In addition, AHGP owns 31,088,338
common units of ARLP.
News, unit prices and additional information about AHGP including
filings with the Securities and Exchange Commission, are available at http://www.ahgp.com.
For more information, contact the investor relations department of AHGP
at (918) 295-1415 or via e-mail at investorrelations@ahgp.com.
The statements and projections used throughout this release are based on
current expectations. These statements and projections are
forward-looking, and actual results may differ materially. These
statements do not include the potential impact of any mergers,
acquisitions or other business combinations that may occur after the
date of this release. At the end of this release, we have included more
information regarding business risks that could affect our results.
FORWARD-LOOKING STATEMENTS: With the exception of historical
matters, any matters discussed in this press release are forward-looking
statements that involve risks and uncertainties that could cause actual
results to differ materially from projected results. These risks,
uncertainties and contingencies include, but are not limited to, the
following: changes in competition in coal markets and the ARLP
Partnership's ability to respond to such changes; changes in coal
prices, which could affect the ARLP Partnership's operating results and
cash flows; risks associated with the expansion of the ARLP
Partnership's operations and properties; legislation, regulations, and
court decisions and interpretations thereof, including those relating to
the environment and the release of greenhouse gases, mining, miner
health and safety and health care; deregulation of the electric utility
industry or the effects of any adverse change in the coal industry,
electric utility industry, or general economic conditions; dependence on
significant customer contracts, including renewing existing contracts
upon expiration; changing global economic conditions or in industries in
which the ARLP Partnership's customers operate; liquidity constraints,
including those resulting from any future unavailability of financing;
customer bankruptcies, cancellations or breaches to existing contracts,
or other failures to perform; customer delays, failure to take coal
under contracts or defaults in making payments; adjustments made in
price, volume or terms to existing coal supply agreements; fluctuations
in coal demand, prices and availability; continuation or worsening of
depressed oil and gas prices adversely affecting the ARLP Partnership’s
investments in oil and gas mineral interests; the ARLP Partnership's
productivity levels and margins earned on its coal sales; changes in raw
material costs; changes in the availability of skilled labor; the ARLP
Partnership's ability to maintain satisfactory relations with its employees;
increases in labor costs, including costs of health insurance and taxes
resulting from the Affordable Care Act, adverse changes in work rules,
or cash payments or projections associated with post-mine reclamation
and workers' compensation claims; increases in transportation costs and
risk of transportation delays or interruptions; operational
interruptions due to geologic, permitting, labor, weather-related or
other factors; risks associated with major mine-related accidents, such
as mine fires, or interruptions; results of litigation, including claims
not yet asserted; difficulty maintaining the ARLP Partnership's surety
bonds for mine reclamation as well as workers' compensation and black
lung benefits; difficulty in making accurate assumptions and projections
regarding post-mine reclamation as well as pension, black lung benefits
and other post-retirement benefit liabilities; the coal industry's share
of electricity generation, including as a result of environmental
concerns related to coal mining and combustion and the cost and
perceived benefits of other sources of electricity, such as natural gas,
nuclear energy and renewable fuels; uncertainties in estimating and
replacing the ARLP Partnership's coal reserves; a loss or reduction of
benefits from certain tax deductions and credits; difficulty obtaining
commercial property insurance, and risks associated with the ARLP
Partnership's participation (excluding any applicable deductible) in the
commercial insurance property program; and difficulty in making accurate
assumptions and projections regarding future revenues and costs
associated with equity investments in companies the ARLP Partnership
does not control.
Additional information concerning these and other factors can be
found in AHGP's public periodic filings with the Securities and Exchange
Commission ("SEC"), including AHGP's Annual Report on Form 10-K for the
year ended December 31, 2016, filed on February 24, 2017 with the SEC.
Except as required by applicable securities laws, AHGP does not
intend to update its forward-looking statements.
|
|
|
|
|
|
|
|
|
|
ALLIANCE HOLDINGS GP, L.P. AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OPERATING DATA
|
(In thousands, except unit and per unit data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
2017
|
|
|
2016
|
SALES AND OPERATING REVENUES:
|
|
|
|
|
|
|
|
|
|
Coal sales
|
|
|
|
$
|
438,744
|
|
|
|
$
|
401,292
|
|
Transportation revenues
|
|
|
|
|
9,596
|
|
|
|
|
6,558
|
|
Other sales and operating revenues
|
|
|
|
|
12,665
|
|
|
|
|
4,875
|
|
Total revenues
|
|
|
|
|
461,005
|
|
|
|
|
412,725
|
|
|
|
|
|
|
|
|
|
|
|
EXPENSES:
|
|
|
|
|
|
|
|
|
|
Operating expenses (excluding depreciation, depletion and
amortization)
|
|
|
|
|
262,792
|
|
|
|
|
263,579
|
|
Transportation expenses
|
|
|
|
|
9,596
|
|
|
|
|
6,558
|
|
General and administrative
|
|
|
|
|
16,447
|
|
|
|
|
17,553
|
|
Depreciation, depletion and amortization
|
|
|
|
|
65,127
|
|
|
|
|
70,607
|
|
Total operating expenses
|
|
|
|
|
353,962
|
|
|
|
|
358,297
|
|
|
|
|
|
|
|
|
|
|
|
INCOME FROM OPERATIONS
|
|
|
|
|
107,043
|
|
|
|
|
54,428
|
|
Interest expense, net
|
|
|
|
|
(7,516
|
)
|
|
|
|
(7,615
|
)
|
Interest income
|
|
|
|
|
25
|
|
|
|
|
4
|
|
Equity in income (loss) of affiliates
|
|
|
|
|
3,700
|
|
|
|
|
(27
|
)
|
Other income
|
|
|
|
|
1,298
|
|
|
|
|
91
|
|
|
|
|
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES
|
|
|
|
|
104,550
|
|
|
|
|
46,881
|
|
|
|
|
|
|
|
|
|
|
|
INCOME TAX BENEFIT
|
|
|
|
|
(12
|
)
|
|
|
|
(8
|
)
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
|
|
|
|
|
104,562
|
|
|
|
|
46,889
|
|
|
|
|
|
|
|
|
|
|
|
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
|
|
|
|
|
(49,551
|
)
|
|
|
|
(16,047
|
)
|
|
|
|
|
|
|
|
|
|
|
NET INCOME ATTRIBUTABLE TO ALLIANCE HOLDINGS GP, L.P. ("NET
INCOME OF AHGP")
|
|
|
|
$
|
55,011
|
|
|
|
$
|
30,842
|
|
|
|
|
|
|
|
|
|
|
|
BASIC AND DILUTED NET INCOME OF AHGP PER LIMITED PARTNER UNIT
|
|
|
|
$
|
0.92
|
|
|
|
$
|
0.52
|
|
|
|
|
|
|
|
|
|
|
|
DISTRIBUTIONS PAID PER LIMITED PARTNER UNIT
|
|
|
|
$
|
0.55
|
|
|
|
$
|
0.96
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING – BASIC AND DILUTED
|
|
|
|
|
59,863,000
|
|
|
|
|
59,863,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALLIANCE HOLDINGS GP, L.P. AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(In thousands, except unit data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
|
|
2017
|
|
|
2016
|
ASSETS
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
92,028
|
|
|
|
$
|
44,525
|
|
Trade receivables
|
|
|
|
|
120,290
|
|
|
|
|
152,032
|
|
Other receivables
|
|
|
|
|
295
|
|
|
|
|
279
|
|
Due from affiliates
|
|
|
|
|
29
|
|
|
|
|
37
|
|
Inventories, net
|
|
|
|
|
77,871
|
|
|
|
|
61,051
|
|
Advance royalties, net
|
|
|
|
|
1,207
|
|
|
|
|
1,207
|
|
Prepaid expenses and other assets
|
|
|
|
|
18,091
|
|
|
|
|
22,128
|
|
Total current assets
|
|
|
|
|
309,811
|
|
|
|
|
281,259
|
|
PROPERTY, PLANT AND EQUIPMENT:
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment, at cost
|
|
|
|
|
2,940,438
|
|
|
|
|
2,920,988
|
|
Less accumulated depreciation, depletion and amortization
|
|
|
|
|
(1,388,753
|
)
|
|
|
|
(1,335,145
|
)
|
Total property, plant and equipment, net
|
|
|
|
|
1,551,685
|
|
|
|
|
1,585,843
|
|
OTHER ASSETS:
|
|
|
|
|
|
|
|
|
|
Advance royalties, net
|
|
|
|
|
39,855
|
|
|
|
|
29,372
|
|
Equity investments in affiliates
|
|
|
|
|
147,052
|
|
|
|
|
138,817
|
|
Goodwill
|
|
|
|
|
136,399
|
|
|
|
|
136,399
|
|
Other long-term assets
|
|
|
|
|
24,011
|
|
|
|
|
25,997
|
|
Total other assets
|
|
|
|
|
347,317
|
|
|
|
|
330,585
|
|
TOTAL ASSETS
|
|
|
|
$
|
2,208,813
|
|
|
|
$
|
2,197,687
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND PARTNERS’ CAPITAL
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
|
$
|
66,054
|
|
|
|
$
|
64,460
|
|
Due to affiliates
|
|
|
|
|
550
|
|
|
|
|
906
|
|
Accrued taxes other than income taxes
|
|
|
|
|
18,481
|
|
|
|
|
18,288
|
|
Accrued payroll and related expenses
|
|
|
|
|
34,189
|
|
|
|
|
41,576
|
|
Accrued interest
|
|
|
|
|
2,460
|
|
|
|
|
316
|
|
Workers’ compensation and pneumoconiosis benefits
|
|
|
|
|
9,826
|
|
|
|
|
9,897
|
|
Current capital lease obligations
|
|
|
|
|
27,505
|
|
|
|
|
27,196
|
|
Other current liabilities
|
|
|
|
|
14,509
|
|
|
|
|
14,778
|
|
Current maturities, long-term debt, net
|
|
|
|
|
149,953
|
|
|
|
|
149,874
|
|
Total current liabilities
|
|
|
|
|
323,527
|
|
|
|
|
327,291
|
|
LONG-TERM LIABILITIES:
|
|
|
|
|
|
|
|
|
|
Long-term debt, excluding current maturities, net
|
|
|
|
|
368,498
|
|
|
|
|
399,446
|
|
Pneumoconiosis benefits
|
|
|
|
|
63,204
|
|
|
|
|
62,822
|
|
Accrued pension benefit
|
|
|
|
|
41,300
|
|
|
|
|
42,070
|
|
Workers’ compensation
|
|
|
|
|
39,940
|
|
|
|
|
40,400
|
|
Asset retirement obligations
|
|
|
|
|
125,888
|
|
|
|
|
125,266
|
|
Long-term capital lease obligations
|
|
|
|
|
78,560
|
|
|
|
|
85,540
|
|
Other liabilities
|
|
|
|
|
17,527
|
|
|
|
|
17,203
|
|
Total long-term liabilities
|
|
|
|
|
734,917
|
|
|
|
|
772,747
|
|
Total liabilities
|
|
|
|
|
1,058,444
|
|
|
|
|
1,100,038
|
|
|
|
|
|
|
|
|
|
|
|
PARTNERS’ CAPITAL:
|
|
|
|
|
|
|
|
|
|
Alliance Holdings GP, L.P. ("AHGP") Partners’ Capital:
|
|
|
|
|
|
|
|
|
|
Limited Partners – Common Unitholders 59,863,000 units outstanding
|
|
|
|
|
620,846
|
|
|
|
|
598,077
|
|
Accumulated other comprehensive loss
|
|
|
|
|
(16,395
|
)
|
|
|
|
(16,550
|
)
|
Total AHGP Partners’ Capital
|
|
|
|
|
604,451
|
|
|
|
|
581,527
|
|
Noncontrolling interests
|
|
|
|
|
545,918
|
|
|
|
|
516,122
|
|
Total Partners’ Capital
|
|
|
|
|
1,150,369
|
|
|
|
|
1,097,649
|
|
TOTAL LIABILITIES AND PARTNERS’ CAPITAL
|
|
|
|
$
|
2,208,813
|
|
|
|
$
|
2,197,687
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALLIANCE HOLDINGS GP, L.P. AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
$
|
176,552
|
|
|
|
$
|
80,278
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment:
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
|
|
(30,346
|
)
|
|
|
|
(31,733
|
)
|
Decrease in accounts payable and accrued liabilities
|
|
|
|
|
2,144
|
|
|
|
|
(6,247
|
)
|
Proceeds from sale of property, plant and equipment
|
|
|
|
|
453
|
|
|
|
|
458
|
|
Contributions to equity investments in affiliates
|
|
|
|
|
(9,287
|
)
|
|
|
|
(20,168
|
)
|
Other
|
|
|
|
|
1,191
|
|
|
|
|
416
|
|
Net cash used in investing activities
|
|
|
|
|
(35,845
|
)
|
|
|
|
(57,274
|
)
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
Borrowings under securitization facility
|
|
|
|
|
—
|
|
|
|
|
22,500
|
|
Payments under securitization facility
|
|
|
|
|
—
|
|
|
|
|
(13,900
|
)
|
Payments on term loan
|
|
|
|
|
—
|
|
|
|
|
(6,250
|
)
|
Borrowings under revolving credit facilities
|
|
|
|
|
—
|
|
|
|
|
105,000
|
|
Payments under revolving credit facilities
|
|
|
|
|
(25,000
|
)
|
|
|
|
(40,000
|
)
|
Payments on capital lease obligations
|
|
|
|
|
(6,678
|
)
|
|
|
|
(4,871
|
)
|
Payment of debt issuance costs
|
|
|
|
|
(6,664
|
)
|
|
|
|
—
|
|
Contributions to consolidated company from affiliate noncontrolling
interest
|
|
|
|
|
251
|
|
|
|
|
796
|
|
Contribution by limited partner - affiliate
|
|
|
|
|
800
|
|
|
|
|
—
|
|
Net settlement of employee withholding taxes on vesting of ARLP
Long-Term Incentive Plan
|
|
|
|
|
(2,988
|
)
|
|
|
|
(1,336
|
)
|
Distributions paid by consolidated partnership to noncontrolling
interests
|
|
|
|
|
(19,810
|
)
|
|
|
|
(30,388
|
)
|
Distributions paid to Partners
|
|
|
|
|
(32,925
|
)
|
|
|
|
(57,468
|
)
|
Other
|
|
|
|
|
(190
|
)
|
|
|
|
—
|
|
Net cash used in financing activities
|
|
|
|
|
(93,204
|
)
|
|
|
|
(25,917
|
)
|
|
|
|
|
|
|
|
|
|
|
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
|
|
|
|
47,503
|
|
|
|
|
(2,913
|
)
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
|
|
|
|
44,525
|
|
|
|
|
38,678
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
|
|
$
|
92,028
|
|
|
|
$
|
35,765
|
|
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20170501005293/en/ Copyright Business Wire 2017
Source: Business Wire
(May 1, 2017 - 7:00 AM EDT)
News by QuoteMedia
www.quotemedia.com
|