Earnings call transcript Q4 2022

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Operator

Greetings, and welcome to the Alliance Resource Partners, L.P. Fourth Quarter 2022 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Mr. Brian Cantrell, Senior Vice President and Chief Financial Officer. sir. you, Thank ahead. Please go

Brian Cantrell

those Donna, XXXX. Resource and year this you, conditions now everyone. financial perspective as on current welcome, released its Alliance market discuss we'll Partners and full outlook operating morning, as fourth well and our for Thank and results, Earlier results quarter XXXX and

Following our the open we'll call to prepared remarks, answer your questions.

to our and that some time Securities may morning's from statements, reflected subject today assumptions to of include uncertainties in risks, in remarks reminder a our a with of beginning, and filings and Before time Exchange this contained variety are release. forward-looking the press Commission also

assumptions partnership based from And by a more whether no these has risks obligation or or in or we to of statements statements, or are result available unless underlying remarks, results new events currently materialize these update projected forward-looking of so. as revise incorrect, to future do otherwise, vary may on providing prove While any those expected. actual materially the or these publicly us, law to uncertainties forward-looking information, required our information if

on and differences And these today. Definitions our and of ARLP's the financial has X-K. posted finally, non-GAAP which discussing been measures Form measures, SEC also reconciliations furnished comparable on of website financial at we'll non-GAAP and GAAP directly the end be certain the to measures financial contained most between are press the release,

Officer, call comments. for Joe his a year, fourth our full with over of Now quarter out preliminaries results the Chief President the and Craft, then begin the required 'XX to turn Executive Chairman, and review I'll for of our record way, with and

exceptionally Ukraine to turbulent difficulties, and historically led year global global team prices operating responded XXXX EBITDA. impacting to The XXXX XXXX coal year governmental and high year higher compared with pressures revenues and net XXXX revenues, and interesting as of for achieving market policies commodity the this were and while higher, and sales the ARLP royalty supply an record driving well, gas While Russia's quarter post-pandemic strong the income flows, levels. increases, income ending net results And transportation significantly invasion and Alliance certainly EBITDA demand challenges quarter. also record chain oil costs significantly commodity full inflationary was our delivered to

XXXX. the on at in discuss Looking mine legacy September announced the more acquisitions in Hamilton production coal from to sales an the a more with Coal due to volumes closely combined previously in properties royalty increased increased detail and from October our new X.X% unplanned as compared and moment. the that I for the X.X%, minerals volumes XXXX minerals at oil ARLP's and expectations longwall outage outperformed quarter XXXX volumes quarter gas of production while quarter, XX.X% XXXX our declined primarily will

As fell a result, our X.X%. coal royalty tons

XXXX commodity the up sales all the quarter. coal XXXX during gas coal per prices X.X% and and We higher X.X% ton increasing royalty saw prices compared as oil price XX.X%, BOE revenue ton, climbing per per quarter to with

XX.X% XXXX up ton, EBITDA [$XX.XX] XXXX versus adjusted $XX.XX, was the and For XX.X% quarter per quarter, XXXX. a was per year up versus segment sold basis ton full expense on the

non-operating sales reflected the materials, of wages, well mines. long-term costs retirement higher us higher for of and passed $X.X a obligations suppliers sales-related factors as as such compensation and various our at on realizations particularly raw result inflationary expenses accruals increased million resins noncash as workers' from lubricants, on asset to liabilities such Our price freight supplies operating in quarter volumes, as our expenses higher a petroleum-related XXXX coal as number including pressures, of and

The unexpected quarter, the Also outage exceptional. by responses resulted mine an Hamilton our were our our members miners four in event weeks. and at XXXX Mine team rescue approximately thermal the to that specific lasted

were with was federal in and we closely injuries and allowed December damaged state with safe regulators, production to work XXXX. Our no kept to equipment occurring, levels return no normal personnel mining operations

the However, Hamilton we for in event percentage and EBITDA XXXX the quarter adjusted of experienced quarter. event, XXX,XXX region been third-party the we of ton directly approximately $X.X tons in third-party the XXXX have with million more Illinois related the per certain increase during with Basin expense incur noncash expenses did segment Absent line approximately associated we expenses to accruals lost the and Appalachia production would for quarter. the

and volumes sharply and XXX.X% offset to also XXX.X%, in previously quarter, respectively, I which price the full Our that costs increases significantly XXXX XXXX rose XXXX were reflect and net other the or the a described. with up These pressures more XX.X%. XX.X% year revenues, X.X revenues impacts XXXX. royalty realizations, sales compared by billion. inflationary Higher and a tons, results coal over record sales increasing quarter. oil on income EBITDA $X.X sales higher higher and total driving million Coal coal combined sales and drove increase $XX.X in volumes and XX.X% gas by revenues higher up production increased to revenue XX.X%, million XXXX year-over-year $XXX.X million ARLP's respectively, than

Net income XXX% record $XXX.X rose to EBITDA to XX.X% $XXX.X and million, increased million results. both

our improved investments, for of of and debt equivalents, XXXX, our trailing sheet all-time with to and reduced strong. year, ratio cash of total Exiting leverage and while distributions cash X.XXx million million to $XXX.X leases net through cash balance generated the adjusted of decreased Alliance an leverage million. $XX.X flow X.XXx. cash EBITDA we X.Xx remained $XXX.X million to $XXX and low unitholders ARLP's growth free returned XXXX, quarterly financing coverage reporting During before by

year-end. million at increased liquidity Our to $XXX.X also

reflecting our our of As A credit this financing. received new term revolving transaction demand, very positive and we oversubscribed with the the the loan fundamentals month, our well and balance facility successfully earlier disclosed of we business closed This strength market was sheet. in

capital us projects as the operations, loan revolving River associated $XXX Ridge Tunnel generated allow day-to-day $XX million well into to new term the new infrastructure while expand million our at Our ARLP's proceeds positions us with financing our increased opportunities to new out capital we and and reserve common areas term distributions, we capitalize credit on us facility View manage our from to units positioning operations. the growth future. obtained senior unitholder including cash support of use enables to this and notes potential plans, allocation in repurchase to The with operations capacity

of outstanding May the repurchase ARLP The up million in point, our that year-end. that had be program. time factors, announced unit ARLP's increasing the at unit review program To negotiated of and to established further or and today board repurchases unit has to $X.X remaining its partner unitholders. financial a XXXX $XXX conditions. capital and units, common million we repurchase time available on to to flexibility and our repurchase was increase to program repurchase in privately authorized no will existing units subject Board other based cash ARLP in authorizes program previously market in Future operating requirements be open capacity performance business well expanded The limited market returning an time may The will transactions. including of limit ongoing as as economic, and and to future number from

may amount does not obligate from repurchase to suspended without or authorization be repurchases time time program our units commenced dollar repurchase and unit number any or to prior of its The ARLP notice.

another $XX coal anticipate in to book, up range to coal over an volumes detailed our contract realizations XX% XX% our morning's to be at highly increase we million to year are $XX to and guidance an committed in Supported is to XX the XXXX. range priced a XXXX. ton, in midpoint of coal overall increase price release. our compared strong the XXXX shaping to this per of million XXXX tons, be of by ARLP. currently anticipating X% turning of in Now at We XXXX sales XX initial

million Currently, XX.X already tons are pricing has million for commitments committed and another priced and in for XXXX. secured and tons 'XX ARLP XX.X

continue these ARLP several should benefit that volumes and to commitments, from we coal sales the next pricing increased With over years. believe

recently anticipate expenses add the in we On higher to will we in our inflationary have pressures we moderation and sales-related side, some to XXXX. the see to in begun continue labor currently factors cost costs experienced XXXX, while

From quarter. higher in before before half recall segment to ton half the result, XXXX standpoint, expect per we built inflation the a during the 'XX first half in levels third a during moderating expense peaking XXXX the to be year. back comparative as year EBITDA dramatically that And compared adjusted the in first the of of of

year, levels to XXXX For XXXX approximately of EBITDA full $XX.XX range segment sold. per increase to a the ton XX% year to $XX.XX is XX% anticipated to by full adjusted over expense

expected Reflecting our to to discussed. $XXX ranging into $XXX of as anticipate this expenditures highlight $XXX these reserve impacts, expenditures we maintenance mine. range are million million One higher million anticipated includes This our $XXX new River we we CapEx as other a maintenance in pressures from a surprisingly, item is previously Not XXXX. $XXX to capital to next impact at area be in between currently inflationary million. capital year and is XXXX. would And million in View expected to this year, capital I have move be capital

January flow. by by an existing royalty weighted directors. days for gas funded additional oil X, which and transaction is announced its XXX,XXX oil next earlier of to Permian date net barrel Since Conflicts as cash of will enhances and effective the in purchase not portfolio, The Basin. royalty close includes Craft, NGLs cash will comprised oil approved benefits to acquisition million Mr. acres within further the the involves with high-quality our and be the and of Additionally, $XX.X entirely only total terms were acquisition of is our accretive cash in add we to independent Delaware immediately expected morning, Permian XX price XXXX, of with of towards X,XXX an Committee, this and This equivalent available this be acquisition XXXX of this entity expected owned but the XXXX. is XX% approximately acquisition an guidance Board

comment upcoming the XX proud I incredible take to organization Before part turn March. grown this retirement been my ARLP let on extremely announced to a last over I'm me what Joe just started has ago we a of have and years that moment become. to that call of to Joe,

interested It more our working bankers will been I bright, CFO effective Carry. years with role and pleasure April as a and look loyal Treasurer, the a honor has anyone following investors, ARLP at and in my to and an closely Corporate at be think many prepared of forward Marshall, Alliance, know, future. Cary President X, assuming can't future colleagues I you analysts. than As and The Vice of for is the capable investor and Finance our

Joe the Joe? With ARLP. call I'll for outlook his on for turn and over to market comments that, the

Joe Craft

and Brian, you, morning, good Thank everyone.

the life. for the please two that you contributor Manager for of appreciate to nearly chapter ARLP in, let critical us. echo Cary he replacement Now Financial Planning. service Brian, have heartfelt and done happiness my with possible Thank and the for me have commitment to you, your by appreciation you've ARLP's and been I Brian, Cary. success since beginning. next observations the I joined success and partnership of best congratulations, you Cary my and everything coal Having your has XXXX, group to closely for him, Marshall. for the side express wish decades want a you in when also a you been me your we our from to continued been as

Cary Marshall

Joe. Thanks,

Joe Craft

be to since XXXX. creating organization the unwavering begin the their to our and need not value persevere, proud focus and in recognized. the I'm dedication entire accomplished extremely I challenges thanking XXXX. determination all by for thrive delivered of efforts, thankful Alliance work comments want unprecedented my all results teams this stakeholders. of financial our ARLP and record began on pandemic of for Through have morning that for only their been has to been but in and long-term resilience The their hard to

let some and the for on me the strategy Now and state industry value share growth thoughts creation our of forward. going

and generation As years it need world. historic a the was for around value importance reminder was mix that keeping to for energy ARLP, our in a year the but the also his year resilience for mentioned XXXX opening the of remarks, a for come, security nation and providing and to Brian coal-fired emphasized nations

the this of about During talked consistent of the point an another the this Elliott recent event experienced have calls the we put on earnings year. continental much arrival what the has Winter Storm all severe way Storm a that Winter become major too brought our all that across common grid with U.S. straining U.S., Elliott exclamation on in cold quarter, fact, in with years. of

gas natural in were significance, as for electricity resulting respond severe froze, and demand storm, to spikes many price the During sources states. constrained wells renewable pipeline soared consumers in deliveries with were unable

that diverse was, was coal-fired let energy despite coal the tragic high evidenced of XX three-year generation a highlight as nationwide U.S. generating of This need repeat, same by latest sources the of in the in almost storm's at it vital was gigawatts As that role particular, of impact the fact coal-fired me period. the was December capacity a the three-year mix plays. for merely retirement and over

embracing strategy, homes electricity. security, As you not-too-distant Texas Winter Elliott for the need the reinforce in at Storm in lights over and Uri, decisions challenge Winter still the today, continue lives is reliability like have heard especially true it urgency many But Policy events and affordable it need all-of-the-above keeps Storm and an most. our repeated the years, we energy devastated to which times industry. on, when coal

portion of comprise significant coal-fired has many several the past market, retirements of retirements in coal recently plant previously years. primary that The especially utilities reported generation grid the for delaying the announced country's regions where forced our a exposed have

transition and create avenues infrastructure, to with the and can energy leverage related ARLP power to embark of and conversation role opportunities any growth. on create the for additional play U.S. in the electric changes continues ARLP vital believe a regulators the to will for utilities, relationships long-standing As grid other customers nation to its we

do an of continue until not plants opportunity can situation. and country's will there. While the which on an future but get as solution, the we the as solution, reality same either-or highlight we rely we advocate our having the Again, and serve needs continue the at view time, to responsibly to coal energy support we to we

new gas this prices turning warmer into Now storage Hub sharply LNG decline export pricing, coal lower-than-expected contributing all current underground the Freeport U.S. the could Henry to continued near-term of of spot year gas to the January natural down their which market month, are burn, to in commodity the terminal with and environment. the cause prices in than than pricing of usual risk coal factors price natural and middle builds anticipated. a grow in remaining stockpiles gas the natural offline the weakness tend faster to winter increase falling heading

far XXXX. our inventory of or have year-end However, of competitors, staged since Eastern U.S. for along coal with impacted by fully most evidenced pricing export are we, meaningfully has coal is either not so This committed of XXX,XXX our inventory little in which available. been were early very tons, XXX,XXX tons

keeping inventories Our planned are schedule, levels. January shipments on at low relatively our

not Internationally, a will and view, to the back and for in trade years in drive impacting come, number energy our of and factors XXXX higher several of pricing routes to global are demand if permanently. continue half

weather last prices so in of losing we thermal in coal mild from Our rebound easing which Russian year this sometime million faced year, partners for primary roughly in midyear trading recent the APIX prices coal the them resulted has peaks And for tons skyrocketing per in resulted far Europe generation, to power consequences in are Europe of during with while imports XXXX. XXXX. expect winter in XX

easing Meanwhile, China's of cleared regulators Australian Chinese imports relaxed, other power continue it supply. steelmaker Australian is coal and broaden, coal, additional to ban pursue the were Australian is to slowly thermal believed and a on pressure their putting will recently metallurgical The allowing of on buy Chinese band being coal. by to generators entities European

replenished reopens, XXXX. next demand as lift Again, stockpiles extend and we replace gas European China's we ahead in to continues demand will be further winter grow supply will need increase believe this and this Europe of and oil, competitive will becomes prices As into Russian expect supply coal more coal Australian to economy as during year.

of at X.X at which unsold drive roughly should current and XX and expect our our that pressures our XX% production forces be which is will growth strong book expected this Of least of of our go priced the export domestic market our assuming X/X as tons sold giving we sales more to in guidance, million we includes the export midpoint to either market are and cost, into though coal coal to export own guidance. dictates. tons, into tons Brian XXXX. expect our year, million line Turning offset are commitments top these market and mentioned, the in Even to visibility the XXXX, for with certainty balance guidance. pricing XXXX expand record guiding inflationary will for sales million or of to committed X.X markets, coal us are as favorable margins higher than as levels we

capital to turning our Now allocation priorities.

an is distributions quarterly over returns distribution per that level attractive announced to maintain term. we distribution, long and unit. elected rate well-covered in the to increase each to primary equating to our $X.XX annualized increase a quarterly Board opposed Our expect our that approved our we quarter. to smaller of XX% the throughout We increments week, focus a as provide declare year unitholders to a Last to

This flows, with low-cost high that co-operations, support to maintain XXXX, near-term competitive and and and projects appropriate committed and tons expected efficiency we investing maintenance in position. advantage. was paybacks on based visibility high-return our funding confidence XXXX capital in continue requirements strong After our distributions, cash will financial our

including us acquisition royalties needs consistent of Thereafter, to the Alliance's evolving pursue as investments record tomorrow oil by in evidenced gas robust cash track the generation our proven flow date, Basin that are attractive announced today. and meet with and positions uniquely investments energy to Permian

we is to leaders continue hired our diversification join next commitments. We ventures these XXXX transition a coal of and commercial efforts royalties. highly our in $XX governments. team group its leverage totaling energy to with strategic on gas dedicated utilities, and competencies three state electric and new core strategy and September, in investments ARLP in evaluating focused to the of opportunities identifying, relationships investments early customers beyond the that oil The and team with allow federal step industrial In executing took outstanding million and

providing approach allocating redeeming these maintain of embark of maintain high-return this journey, Brian senior capital. distributions. to our we buybacks disciplined as include as noted, as to uses well-covered process-oriented we unit to new we evaluating flexibility which other available continue on cash may and portion in will As will businesses, outstanding a well a cash, Absent opportunities notes invest

closing, In ARLP's in equally same revenues, the record of and levels net the I EBITDA; time, income very about of am at proud of excited XXXX us. front opportunities

Our operations well. running are

book contract levels coal Our has position our never is committed and very attractive heavily at been financial stronger.

forward, Looking believe returns to beyond. we cash XXXX attractive solid deliver and our positioned well to unitholders in ARLP is growth and

our now call concludes I to questions. will That operator prepared the ask for comments, and open the

Operator

Today's NOBLE from Capital is Instructions] Reichman first Markets. Mark [Operator of question coming

Mark Reichman

in I then contrast pricing unit get Mine was versus wondering the dynamics and Illinois you the just also, the did Basin if little the moving And you stronger added? at market overall your think Basin Hamilton for produced the outlook for and a other Appalachia coal whether Illinois you forward? could looks

Joe Craft

for Gibson So mine. unit the the other was

And the this to shift. online have to sometime yet it so staffed got that's second in second we come quarter anticipated one added of and the deployed, shift for unit the year. and is We've be

and the that's say position, about it half Illinois unsold. So have export our the we Illinois Appalachia. of Appalachia, half in of most that of Appalachia production for And is I'd is Basin is market Basin targeted versus the unsold for to back the the

export either so pricing market be. or Basin the tonnage do either depending domestically will And on the to that the flexibility in we have what Illinois market sell

from in domestically inventory really utilities market, the than opportunities weather market in Currently, fourth not given and the activity build did we are much coal the warm the for quarter. are inbound the that more the we export there's seeing

year, mean, and for requests to additional open customers the I it's the as our there question the answer hard rest specifically be at the So an that still for we the winter position, your likely will dependent, believe summer. in the well have as half of of moment. of more tons, weather back most

open is in second book compared first the do our sold in of much pretty the most the position moment what see current up we for is at and seeing opening our again, really markets we're when time. half So favorable half, to

Mark Reichman

in but had back the to locations? to just more oil acquisition, one like of can additional of queue. then of I a last Okay. respect the I'll permitted provide the information the about in the in and acquisition, like producing wells With you barrels get talked Brian some number completed question terms of equivalent, number be

Brian Cantrell

year-end give the or which I'll XXXX locations some at our wells. statistics. an had Mark, we permitted XXXX have our XX being wells producing acreage, increase year, XX completed. end on XX,XXX of currently at level, from the X,XXX acreage the At XXX we year-end or drilled was X,XXX end an had And levels. -- currently XX being had running end wells on on Hey, the our of total of aggregate of increase locations, the have over the permitted we wells acreage, you XXXX wells and we about We XXX year with

Operator

is from Company. Martin next question of coming The Benchmark The Nathan

Nathan Martin

see of to related I increase you quarter-over-quarter in had like knocked heard year. out question you the those one you distribution. sounds to that the about it see throughout just the in maybe comments big flattish -- kind a chunk, I Great significant how target.

you as any then Is the think ahead? look we still still Board more I cash adjusting Or we case? with targeted target that on on the target this in fluctuate about Any mentioned ratio on past, a depending the a have guys think coverage would XX% going payout. around should as just distribution level that conversations generation? the and payout thoughts that about

Joe Craft

year generation contracts locked point over seen strong we forward. more given the that with cash flows in what a cash ratio we in that from that to growth and we've moderated the say coverage view I'd perspective, have going of that have

company. distribution levels to and flow be at cash participate from X.Xx out the grow So in this able still the at that will have X.Xx be believe coverage sufficient anywhere pay trying coverage to that we are to a to we today can ratio we

Nathan Martin

Great. Joe. Appreciate that update,

As to that the you to start year, of and the domestic fluctuations price about variability realized priced 'XX what weakness guys coal is some for of thermal to per largely incorporated the those in tons talked into and markets your ton portion committed price XX% in guidance. gas or susceptible export notable are I guidance? mean again, midpoint either market,

Joe Craft

So committed, the they're tons I what price factored all committed know are is. price. prices all have fixed we guidance. into so mean our They the been

gave production, the to tons in Our XXXX, that when midpoint our they're view We we going at those on market. factor we the And of the have sort now, can believe priced where we achieve opened market situation. UI again, Again, market levels. be price in the to and of both you the based of UI we that, committed the definitely guidance our projected we the is. right what is think you

to of be I sell been I pricing is when -- going to the factored sort standard the on gives be our start is making of the very market China's believe that export think going I and of has us set happen. half going of where the confidence that coal. the market. we volume believe the so the year people will supportive that the is own to it's is decisions not that to second into reopening going And believe dependent most think I economy. to the

Brian Cantrell

as commitments in this look of firm to of most our of half Yes. And Nate, the year. half we're in year. back the And XXXX, for the at open back during his up our as pricing times Joe you anticipating are comments, mentioned opening

pretty So year. as articulated, this Joe for levels has we the confident about that feel just we're price projecting

Nathan Martin

of in you firm half So the the second move by and year? misunderstanding the pricing am I from half saying we of Are or increases year thinking kind you're the up throughout what that. back first Brian, the as half,

Brian Cantrell

Yes. Yes.

Nathan Martin

you half mean, to think, just confirm about Okay. I I said expenses half of about think first the throughout way And year, mind? just in cadence longwall a moves likely the standpoint, also also than to kind from higher any it thinking any shipment to second Brian, keep Perfect. that And expenses. then,

Brian Cantrell

scheduled the normal have eight. cetera. impacts we obviously have a more This XXXX. year, have total we of moves longwall a Last at I longwall shipping, do of in vacation, six. quarter had first believe Ridge -- Tunnel the Tunnel year, we et first -- have Hamilton of move We half for first of two in miners' of and holidays, Ridge we total On this scheduled the seasonal at a in I'm the quarter year. both sorry, the

strong it believe So quarters. are spread fairly be the I balance of be over would deliveries year open year. and then we the after first the in out going consistent that, remain And our of will half as that to the position, rest look second the well. our of as should the up back

Joe Craft

Yes.

And about you bump So we the the quarter Hamilton as and of X.X can -- you Gibson -- the the when had that look that impact see you fourth you'll on as quarters. quarter, see second fourth third million unit you comes up for in know the sequential at second at tons. quarter,

the think of sequential first for quarters, then about half to half that first unit the the slightly the it second in the you So couple as should quarter the second and be half similar at -- Gibson. higher year first of

Nathan Martin

Joe. Okay,

So XQ shift occurred. comes second bump get quarter, the Hamilton basically, with quarter in Gibson second on, then seemingly back, you that should first sounds And a X.X XQ see that and million flattish event up? versus tons we then it behind like

Joe Craft

the not due first got the of in number second into back full Yes. quarter, longwall get quarter the may There pretty the -- to may amount moves close. we you but it's

Nathan Martin

CapEx came higher of than like A your looks forward, looks in queue. little within like updated just $XXX million then Many that maintenance back guide, color. million carry 'XX CapEx year me, appreciate growth excuse lower items get bit the about it and that -- a guidance? finally guidance. in roughly Really grew And incorporated little it. expected, grew then maintenance kind $XXX Got on I'll in it And than 'XX full year-over-year.

a give year-over-year bit driver could Assuming maybe well. little again, as piece color the of the main what's that's in guidance included the you increase. But growth more

Brian Cantrell

higher On last associated Other year-over-year timing at you we capital are reserve capital, And new that influenced as this growth is we've we in this rebuilds maintenance just obviously our maintenance, also be piece, impacts more by definition, you'll we're capital have Nate and in rebuild incurred point opening particular areas XXXX, will cetera. to of occurrence equipment, the in mentioned with which the know, can and main schedules, costs factors supplies, View et into of than volumes, expenditures of the and inflationary the quarter et by portion And increased recently. on River that, year have during impacting remarks, maintenance projecting capital as next. seen heavily moving related the reflective. time we be our cetera, an then pretty maintenance

Operator

from next coming David of Storms The question is Stonegate.

Dave Storms

wondering Just color if turn seasonal more specifically what seeing a on transportation to you're any give starts as expenses outside moves? little a of you to and inflation as could corner just

Joe Craft

we Expenses still elevated are -- run the into going expenses, as On performance. we the into transportation are better year. seeing

does tie pricing export the to Some in of that market.

our not of So position. sold-out Again, because been that. there could be there's much of some softening activity

for we'll the see So goes to how the year. of and back have wait that half

sure not understood I'm your part your question. of second So I

Brian Cantrell

us, Maybe transportation just pass-through. as that for well are reminder expenses

Joe Craft

for export. Except

Brian Cantrell

Except for export, that's correct.

export operations? influence or in the at where market can has it the our achieve really we market? around make we highest that an the domestic netback So Is on decisions

Dave Storms

perfect. you. the that movement, then you that export Russia XX Thank those with million XXXX gap do into view going just ton And laps? That's sticky how constative on

Joe Craft

We be decisions renewables, there. We that to but think 'XX, trying you to several their believe as will that, get They've a opened But lot LNG. end to of they're plants. depends the towards may that make. There's own 'XX, country, opened that coal them end move continue be do to for their to they then more there opportunity move into coal they've up up facilities. on

to XX demand energy long X look to plants to that How so believe X.X their opportunities on we meet more the we're that So But million opened in of tons sell needs. grow. coal going not than to for if Russian you know. that if our supply, those to to stay think hard at export million in they've XXXX added there there's or is online? like is of in addition itself tons It the based market, that million sustain plenty we for

million-ton we at the pandemic, rate. a go were back you XX shipping If before

So I but sure last the not with so. there back just years level, over us we've seen for six get is grow we'll that to opportunity think or the demand to that

X.X million, we growth. operations, say, so of million X with domestic next in we million stability alternatives three don't lot to We to X.X in the that economy need compete the need in our market. tons over And not can to and years we global if that just the believe a low-cost there's four

Operator

from Research. is David of question next coming Marsh Singular The

David Marsh

promotion. Congratulations congrats Cary, on the retirement and on congrats the quarter. Also, the Brian, on

filed? So kind one you question. date staying going just are targeted you'll mind have you a get XX-K quickly housekeeping the Brian, do to on K of filing. the through be And when in

Brian Cantrell

of here end X. the through filing steps April My the is And on February. in and XX, that. targeted K toward yes, be I be March will Cary should date We

David Marsh

just one fact more just I us some to know closed. like -- encouraged activity that on it flow I perhaps on just highlight a color going give was immediately you your could of acquisition criteria. by And I'm high-level cash the that criteria the kind this very wanted you regarding And could sounds I when acquisitions. was one. it. then you Got another be if to intrigued little and guys you're bit of evaluating accretive the by if your wondering it. Got comments

Joe Craft

underwriting for then us be risk-adjusted returns certain unitholders. term more that longer for have standards oil give results gas, having are very our but that in focused and nature not will we on will We only

this particular our gas the on prior return We've for reinvest So probably, past. allow will and been oil group, generate consistent basis acquisition, thresholds we committed the whatever an cash to them flow to segment obviously, have that royalty the year. with they EBITDA

sell or so we beyond their what current I'm prices million So that investment that some we gas they to at the another hoping made want today. announced have for people will XX are. capacity

give opportunities could people don't that So I us will. some know if there.

to the to and or mixed or Interest are. are they moving is going be now, are services kinds to we're interest as for on that right the products solutions I the going of of the all focused those challenging capital. is term. -- rates market that's a then is cost acquisition looking where And very think and on right are where So and needed it Fed we're of whether signals just right long where be to are for what be rates or that going part is

cost make capital a obviously, So little moving a of right cost those I environment. would return to have think been not order that to maybe probably investments, higher have attractive have our than level been you of your could now they in significant above otherwise bit of have capital and long-term in had what cost is evaluations XXXX more conservative we a that

bit turn to higher get our may capital, in we cost than words, will nice make it other damn a above we're sure possibly to of cost we 'XX a In capital out on going a and little that what be. return hedge of

Those higher perspective. be obviously impacting the interest rates will seller's

what so from market that and/or just in standpoint on needs options looking their be at depends as cash they're And for acquisition the their at. look that will they an strategic

David Marsh

the Is guess so lot sense. a potentially coal of anything really gas. makes acquisitions That oil the more things announced far where there are compelling? I on could side become and

Joe Craft

coal far There's space. haven't been opportunities, many as -- the as there in

we've we've which could thing only is think coal been the to our met had operation. potentially standpoint, an from that able a that from potentially strategic get our be on I opportunity, Mettiki list,

but way I It's that's is the so And best probably it. probable. see not possible, I'd it's could that highly area put an

front. on is on of now. there's our most coal acquisitions So the nothing sector In words, going focus other right outside

Operator

is of Abe The of next question America. from Bank Landa coming

Abraham Landa

of on couple questions a Just the balance sheet.

I'm sure fall So little. are beginning aware income you're markets a fixed to

some call the this holistically, about bonds, May capital your Maybe discussion, your have more did up know mention notes price bonds? which structure kind are kind I'm what sure about in take potentially of specifically could your some of steps redeem you you you you par your bonds your a of to then coal early. companies allocation capital and And seen portion thinking more other We down even X.

Brian Cantrell

mature taking generating, see that the the And bonds open we down. We did the to market financing cash achieve then out Yes. bonds, have make opportunistically in that if opportunity we're flexibility needed we the beyond until warrant. go flexibility. do strong potentially time sure completely that, we goes correct, market of when you're to par wait to they completed And right with those bank take to that should our the before conditions pick that down and manage repurchase bond those plenty it's very, of time flow we'll potentially markets in of evaluate this call we've be up conditions in at got May May very -- bonds 'XX. the whether and is attractive watching try closely to positions to year. and to we the to to With wanted choose respect begin we of some Clearly, We'll levels. that, to we have to our right

Joe Craft

obviously on alternatives. depend Yes, other our will it

Abraham Landa

capital other alternatives. allocation like Meaning

Joe Craft

that opportunities -- If up. there's pop acquisition-type opportunity

Brian Cantrell

on priorities, intend the currently we maintain is Yes. of sorry, today unitholders is -- capital distribution to to Joe I Friday, level mentioned, to returning as we mean, The managing core well. sheet I'm announced our as one year. through allocation cash intend or obviously, balance that our

conditions could a return well to the we've additional through cash the with fairly top given defined. been our Board bank repurchase with week. elected to we that's So flexibility that And off warrant, program refinancing. Should last unitholders

Abraham Landa

two extended. good agreement just was see your quick then It credit was to housekeeping. And

also it currently just it And think uses. note, a within $XX -- loan, included maybe that million that undrawn? also, is I term

Brian Cantrell

closing. term is at loan The No. drawn

do on some So prepared at Tunnel we River and we View the cash balance on Ridge. that acquired additional our is we going reserves sheet. have at now that coal our noted In comments, these activities

using million more So activities effectively period those turn $XX extended of time out a that primarily. we're to for

Operator

The next of Mark Reichman Capital NOBLE is question coming from Markets.

Mark Reichman

guidance, unpriced Just in quarter talk agree was the But Illinois and stronger meet with was open how you ton of on a have an observations. coal or wondering so and guidance? make about you those to when much your second at $XX.XX about I'd just the the -- Basin in on those a leap fourth ton. Appalachia -- prices to I $XX in tonnage half of terms a

Joe Craft

you Not think mean then you said, like quarter much. look I averaged $XX.XX. mean, at fourth I our if look quarter our and guidance, fourth at you I

And so our guidance is what?

Brian Cantrell

$XX to $XX.

Joe Craft

$XX.

with we're what see have right can on committed. we you So

those numbers. going have so And we anything that open, helpful it's to to be

that of say if you in But would or I -- think in. range. that year... the the the where we're -- got end range guidance get that's our flexibility think within pricing so I yes, for conservative that to there the we've that's higher So I midpoint the is

Mark Reichman

you up good ventures And I there in of was on Or terms has ideas? -- kind curious then the progress team come just there? your -- new pretty of expectations have have what are with seen some they what

Joe Craft

that narrow are process as established resources. there. to many Primarily, out our well preferred be many, many, us they that We're time trying opportunities and our we a so help as with and as into our we internal resources to have the through we people of efficient to those can we take resources those external go established -- trying resources, and areas multitude opportunities

the right on targets. focused we're that So

of short So period a they progress in significant made time.

I how to clear that think on to approach want we we've a opportunities inbound vision got come us.

very we much also us using We fit competencies outside returns. that sources areas and go with be we are, those some target again, have proactive us to believe core an risk-adjusted to what long-term that's that approach our certain will give help

we're process in transition a lot the a that limit growth the been of the late of trying to looking stage of are the more we're to transition-type of ourselves in not what just world, mid- these Most things on at investments. have

flow has looking progress good. So type that are financed. have that say cash been bit can would our be things other at little I we're that mature more a But

the we're having just can same it's time. take at look going and a there's we At that a time, to things prioritize little of lot to

Mark Reichman

the strength One longevity always and thing team. is the Alliance's I've appreciated of management

to results. congratulations for excellent Brian whole Cary to for the excellent So team and the -- and both an

Operator

Kensico Coleman is from The of Capital. next question coming Tom

Tom Coleman

team whatever, royalty free having use can about comment to their the to back wanted to their business. XX go million keep like they expanding your Just or cash

a does with So difficulty] they it deal, you when feel come [technical to

Joe Craft

cutting You out… are

Tom Coleman

common of that the there repurchase. a come you're get stock do royalty think the When willing guys a to Is reach little you level? certain compare business comment important the in to mass relative you and Okay. achieve critical to with size packaging the a that's to and the here How royalty bit deal standalone? the in about to

Joe Craft

Minerals gas we about you a proven have in that believe have way our little we going we and our bit. underwriting approach. We track be the think and But were believe is successful record decades. here is oil to for a segment it Again, cutting that -- been now do out has we decades

to that so And they our to so it I guidance cap. have objectives compete flow developing latitude them deal again, think that much it strategic a them. sustainable give flow. know and know certainty in It's try We've they they some can not meets have with to given capital available the to how them cash

in do a think basis, on we not that or quarterly we of they we other come re-examining those, look I look those at allocate can evaluate bring terms capital at to to if segment. whether and that but opportunities want thinking not us that that to

late committed and a million long-term investment faith a us it's get to how to We that since is that to for to proven whatever record $XXX the we value good capital. believe as believe believe basis, have the of to has proven number. be it an that understanding since we we've a opportunities and it's far, XXXX, to put XXXX. to track to we in will on business. and needs case their place a have annual meaningful can We attractive We're we continue confidence allocate grow to that We those business. an so million so That business if been $XXX growth

Operator

to over back for floor the turn At I like would Mr. this Cantrell closing comments. to time,

Brian Cantrell

Donna, interest the in continued morning support sincerely as this and to your you, everyone as on Thank well Alliance. We call. time and your appreciate

hope first our everyone results day. Thank currently expected This will much. again quarter very discuss and we enjoy us XXXX in you operating at the occur to is time. April, call call and our for next to that financial Our late concludes will join

Operator

thank gentlemen, event. for you This today's participation. and concludes Ladies your

log this You webcast your and may or at lines time, the day. enjoy disconnect of the off your rest

Alliance Resource Partners (ARLP) 30 Jan 232022 Q4 Earnings call transcript