, the largestU.S. coal producer, reported a first-quarter loss of $165.1 million as coal salesdropped 30% from the year-ago period due to weak markets, according to a Form 10-Qfiled May 6.
Revenuesfell to $1.03 billion from $1.54 billion in the year-ago quarter. Coal sales droppedto 42.5 million tons from 60.6 million tons with production from its Powder RiverBasin and Western U.S. mines fallingthe most in percentage terms. Its sale of metallurgical coal from Australian minesdropped 11% to 3.3 million tons and sales of Australian thermal coal increased 2%to 5.2 million tons.
Peabodyfiled for bankruptcy courtprotection April 13, but said it intendsto emerge from restructuring as a "leader in the industry well into the future."
In itsquarterly filing, the company said results were impacted by falling demand for seabornemet and thermal coal due to lack of growth in global electricity generation andpolicy measures in China supporting the domestic coal industry and limiting imports.
In theU.S., "electricity generation from coal was unfavorably affected during thatperiod by coal-to-gas switching due to 14-year low natural gas prices and lowerheating-degree days due to mild winter weather," Peabody said.
"Tomitigate the impact of lower coal pricing, we have continued to drive operationalefficiencies, optimize production across our mining platform and control expensesat all operational and administrative levels of the organization," it added.Operating costs and expenses were cut to $920.2 million from $1.32 billion in thethird quarter of 2015.
Peabodysaid it expects modest seaborne met coal supply cuts in 2016 as declines in theU.S. overcome small production increases in other exporting nations. It expectspersistently low natural gas prices in the U.S. will force utilities to decreaseconsumption about 75 million to 100 million tons in the next 12 to 24 months.
"Asa result of lower consumption, stockpile drawdowns and weaker exports, we now estimatea 175 to 210 million ton decline in 2016 total U.S. coal shipments," Peabodysaid.