SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
July 7, 2003
Commission File No.001-11155
WESTMORELAND COAL COMPANY
(Exact name of registrant as specified in its charter)
Delaware | 23-1128670 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
14th Floor, 2 North Cascade Avenue, Colorado Springs, CO 80903
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code:(719) 442-2600
Item 5. Other Events.
In June 2001, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 143, “Accounting for Asset Retirement Obligations.” Westmoreland Coal Company (“the Company”) adopted SFAS No. 143 on January 1, 2003. The Company is filing a table of Selected Financial Data as of the dates and for the periods indicated from the Company’s historical consolidated financial statements, and as adjusted to give pro forma effect to the change in accounting principle as if SFAS No. 143 had been in effect during the Company’s three most recent fiscal years.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits
Exhibit 99.1 - Selected Financial Data
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
WESTMORELAND COAL COMPANY | |
Date: July 7, 2003 | By: /s/ Ronald H. Beck |
Ronald H. Beck | |
Vice President - Finance and Treasurer | |
(A Duly Authorized Officer) |
EXHIBIT 99.1
Selected Financial Data
In June 2001, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 143, “Accounting for Asset Retirement Obligations.” Westmoreland Coal Company (“the Company”) adopted SFAS No. 143 on January 1, 2003. SFAS No. 143 requires entities to record the fair value of asset retirement obligations, with an equivalent amount recorded as basis in the related long-lived asset. An accretion cost, representing the increase over time in the present value of the liability, is recorded each period and the capitalized cost is depreciated over the useful life of the related asset. Previously, reclamation costs were accrued on an undiscounted, units-of-production basis. As reclamation work is performed or liabilities are otherwise settled, the recorded amount of the liability is reduced.
Pursuant to the transitional disclosure requirements of SFAS No. 143, the table below sets forth selected consolidatedfinancial data for the Company as of the dates and for the periods indicated from the Company’s historical consolidated financial statements, and as adjusted to givepro forma effect to the change in accounting principle as if SFAS No. 143 had been in effect during the Company’s three most recent fiscal years. The following data should be read in conjunction with the historical consolidated financial statements and related notes of the Company, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which includes a discussion of factors materially affecting the comparability of the information presented, and other financial information included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2002. Future results may differ substantially from historical results because of changes in oil and natural gas prices, increases or decreased in production or other factors, many of which are beyond the Company’s control.
Westmoreland Coal Company and Subsidiaries
Five-Year Review
2002 | 2001(1) | 2000 | 1999 | 1998(2) | ||||||
Consolidated Statements of Operations Information | (in thousands, except share data) | |||||||||
Revenue - Coal | $ | 301,235 | $ | 231,048 | $ | 35,137 | $ | 38,539 | $ | 44,010 |
- Independent power and other | 14,506 | 15,871 | 32,260 | 34,492 | 64,465 | |||||
Total revenues | 315,741 | 246,919 | 67,397 | 73,031 | 108,475 | |||||
Costs and expenses | 297,415 | 233,313 | 60,564 | 63,456 | 78,361 | |||||
Unusual charges | - | - | - | - | 2,000 | |||||
Doubtful account recoveries | (516) | (446) | (400) | (174) | (1,028) | |||||
Impairment charges | - | - | 4,632 | - | - | |||||
Losses (gains) on the sales of assets | 9 | 440 | 6 | (433) | (475) | |||||
Operating income | 18,833 | 13,612 | 2,595 | 10,182 | 29,617 | |||||
Interest expense | (10,821) | (8,418) | (911) | (1,135) | (190) | |||||
Minority interest | (800) | (780) | (518) | (854) | (775) | |||||
Interest and other income | 4,128 | 3,229 | 867 | 1,826 | 1,999 | |||||
Income (loss) before reorganization items and income taxes | 11,340 | 7,643 | 2,033 | 10,019 | 30,651 | |||||
Reorganization legal and consulting fees | - | - | - | - | (9,872) | |||||
Reorganization interest income (expense), net | - | - | - | - | (1,594) | |||||
Income tax benefit (expense) | 2,368 | (1,228) | (428) | 82 | (3,787) | |||||
Income from continuing operations | 13,708 | 6,415 | 1,605 | 10,101 | 15,398 | |||||
Loss from discontinued operations | (3,583) | (1,188) | (1,297) | (1,464) | (12,070) | |||||
Cumulative effect of changes in accounting principles | - | - | - | - | (9,876) | |||||
Net income (loss) | 10,125 | 5,227 | 308 | 8,637 | (6,548) | |||||
Less preferred stock dividend requirements | 1,772 | 1,776 | 1,776 | 2,992 | 4,888 | |||||
Net income (loss) applicable to common shareholders | $ | 8,353 | $ | 3,451 | $ | (1,468) | $ | 5,645 | $ | (11,436) |
Net income (loss) per share applicable to common shareholders: | ||||||||||
Basic | $ | 1.10 | $ | .48 | $ | (.21) | $ | .80 | $ | (1.64) |
Diluted | $ | 1.03 | $ | .43 | $ | (.21) | $ | .79 | $ | (1.64) |
Weighted average number of common shares outstanding: | ||||||||||
Basic | 7,608 | 7,239 | 7,070 | 7,040 | 6,965 | |||||
Diluted | 8,147 | 8,000 | 7,070 | 7,146 | 6,965 | |||||
Pro forma amounts assuming the change in accounting principle is applied retroactively: | ||||||||||
Net income (loss) applicable to common shareholders | $ | 8,506 | $ | 3,535 | $ | (1,562) | n/a | n/a | ||
Net income (loss) per share applicable to common shareholders: | ||||||||||
Basic | $ | 1.12 | $ | .49 | $ | (.22) | n/a | n/a | ||
Diluted | $ | 1.04 | $ | .44 | $ | (.22) | n/a | n/a | ||
(Continued)
Westmoreland Coal Company and Subsidiaries
Five-Year Review (continued)
2002 | 2001(1) | 2000 | 1999 | 1998(2) | ||||||
Consolidated Statements of Operations Information | (in thousands, except share data) | |||||||||
Balance Sheet Information | ||||||||||
Working capital (deficit) | $ | (1,626) | $ | 11,346 | $ | (1,557) | $ | 8,886 | $ | 15,054 |
Net property, plant and equipment | 189,532 | 197,271 | 34,693 | 36,558 | 36,950 | |||||
Total assets | 451,064 | 466,532 | 139,096 | 142,297 | 215,606 | |||||
Total debt | 100,157 | 122,910 | - | 1,563 | 1,762 | |||||
Shareholders' equity | 18,568 | 10,415 | 3,373 | 3,057 | 21,845 | |||||
Proforma amounts assuming the change in accounting principle is applied retroactively: | ||||||||||
Asset retirement obligation | 136,257 | 127,068 | 12,751 | 12,182 | n/a | |||||
(1) | Effective April 30, 2001, the Company acquired the operating coal business of Montana Power and the coal assets of Knife River Corporation. Refer to Note 2 to the Consolidated Financial Statements for further information. |
(2) | On December 23, 1996 Westmoreland Coal Company and four subsidiaries, Westmoreland Resources, Inc., Westmoreland Coal Sales Company, Westmoreland Energy, Inc., and Westmoreland Terminal Company (the "Debtor Corporations"), filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Colorado. The Debtor Corporations were in possession of their respective properties and assets and operated as debtors in possession pursuant to provisions of the Bankruptcy Code. The cases were dismissed on December 23, 1998. |