ST. LOUIS (AP) — Coal miner Peabody Energy Corp. said Thursday its first-quarter loss more than doubled on weak prices, falling short of Wall Street expectations.
The world's biggest private-sector coal company also predicted another loss for the current quarter.
The coal industry in recent years has been challenged by power companies that have switched to cheaper natural gas as their energy source, forcing many coal producers to shutter mines and curtail production. But many mining companies say an increase in the cost of natural gas is reviving demand for coal.
"We have seen a substantial increase in U.S. coal demand, and coal generation is now nearly twice that of natural gas," said Gregory Boyce, Peabody's chairman and chief executive, in a statement.
Even so, Peabody's results marked the coal sector's latest first-quarter earnings disappointment. St. Louis-based Arch Coal Inc. said Tuesday that its loss over this year's first three months widened to $124.1 million from $70.5 million, hurt by weaker prices and demand. Arch Coal cut its outlook for shipments of coal used in making steel.
And markets for imported coal remain "challenged" overseas, notably in coal-craving China, Boyce said. But Peabody expects demand in China for imported coal will increase due to the government's plans to close mines and stimulate the economy and rising costs in China.
Peabody expects demand for exported coal used in electricity production to rise 20 million to 30 million tons this year industrywide, with the appetite for overseas steel-making coal to grow 10 to 15 percent from last year through 2016.
Peabody's loss for common shareholders during the January-March period was $48.5 million, or 18 cents per share. That compares with a loss of $23.4 million, or 9 cents per share, a year earlier.
Excluding special charges, the St. Louis-based company's loss was 19 cents per share.
Revenue fell about 7 percent, to $1.63 billion from $1.75 billion.
On average, analysts polled by FactSet expected a profit of a penny per share on revenue of $1.69 billion.
For the current quarter, Peabody forecast a loss of 14 to 39 cents per share. Wall Street projected a loss of 19 cents per share.
Shares rose 44 cents, or 2.5 percent, to $17.83 in afternoon trading.