Alliance Resource Partners (ARLP) 26 Oct 202020 Q3 Earnings call transcript

Good day, and welcome to the Alliance Resource, L.P.

Third Quarter 2020 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions]. After today’s presentation, there will be an opportunity to ask questions. Instructions]. [Operator event this being is note recorded. Please like Brian Cantrell, would now CFO. to to over conference the Senior turn I Vice and President Please go ahead.

Resource prospective and we’ll Thank this discuss these quarter welcome, and well now conditions financial Partners as and as Alliance our XXXX results, you, third market released operating everyone. and results its on Matt, morning, Earlier outlook.

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

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

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

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

to emerge cautiously optimism. ARLP's certainly our that President poised and Officer perspective. activity, prices improve. and as to and with were were XXXX financial strong the gas to oil and quarter. quarter review out justified Encouraging required coal Executive of performance ARLP's preliminaries optimistic our begin and Craft, and results for And our we the we results, Chairman, operating beginning are over turn call entered production trends this of then the Chief his economic the I’ll way, demand and the With Joe

expand increased operating our and quarter, performance revenues mineral During debt delivered the capital and Increased XXXX sequential a expenditures quarter, and the compared X.XXx sequential flow Alliance from $XXX million; quarter, total in metrics by lower improved increases by XXX.X% coal comfortably over financial jumped continued end XX% flow million $XXX.X leverage for in the XXX.X% reduced EBITDA million, capital with to quarter, resulted total all $XXX.X free $XXX.X both cash operations the quarter. our free debt segment. million. Total to XX.X% of net climbed major to liquidity the improvement to us reducing of and income attributable all by to XXXX ARLP significant million; increases ARLP and $XX.X compliance reflecting and XX.X% costs, to to covenants. to ARLP's on to at expenses, cash keeping working focus $XXX.X million These the allowed XXXX

consolidated Turning to our results.

by compared Segment and decreased coal XXX.X% lower quarter. expense of XX% Segment sales coal price of ARLP's resumed in oil completion mines from and as in by our stronger our all operators Let's wells a at online XX.X%, gas also ongoing shut sales led business favorable of demand $XXX.X and inventory operations, million. oil the to EBITDA expense our cost bring increase acreage. $XX.XX the adjusted resumption on XX.X% rebounded commodity lower our prices costs. in closer ton production $X.X control increased higher by and mining to of performance our coal all the I'll adjusted The strong million previously million quarter, realizations, back compared offset segment than with royalties And ARLP's segment per the to adjusted from to mix quarter, complexes, higher XX.X% improved increased mineral per lower segments. equivalent and XXXX on and to sequential call led and sales and revenue XDURING results Starting for led Joe? price drilling ton performance and benefited realized by XX.X% higher from XXX,XXX by slowly look and over XX.X% production our impact more and Compared lower the bonuses coal driving EBITDA completes contributing segment the adjusted oil quarter. higher quarter, XX.X% cost million. of EBITDA XXXX volumes, by to the in ton to wells $XX.XX the volumes Joe. volumes and production decrease sequential gas per acreage a reflects review coal the to each now turn sales ton per mineral sequential delivered The initiatives respectively a in Increased and quarter. XXXX of coal pricing revenues quarter. of take to of segment, total X.X%. at barrels and the volumes our also BOE $XXX.X the gas at of lease per That Increased $X.X oil EBITDA XXXX up to

you, morning, Good Brian. Thank everyone.

industry. family of coal in started away the overstated. Bob heard, had I'd my years. I this sure of country like touched His Before XX the yesterday. cannot than more all Bob industry for everyone lives get to to giant be condolences morning, with Murray, our I'm the has importance passed you express he associated to a coal

you moment join the America. please reflect made silence Bob the in Thank lifetime So of for me of many his contributions to a all. on good during

rebounded and increasing weather sequential As quarter half increasing resulted XX% demand of by Eastern that the the falling XXXX, this rebounded in United in support quarter. quarter, first generation third oil as very increased XXXX electricity quarter coal-fired XXXX prices low sequential overall quarter, and continue to second in over even economic demand, shape also during quarter. prices Brian activity patterns in back drilling favorable peak the were encouraging resulting resuming shut July June some by slowly historically power quarter, during in gas progressed. we and in to oil and and the States the in operators bringing experiencing With the loads take activity this XX% signs completion stronger during into lower commodity year-over-year After and XXXX and in After jumping to XX. develop the production had wells beginning X% to gas the morning, compared oil mentioned in August the cooling

these trends While strong contributed performance ARLP's quarter. the XXXX to macro in certainly improving

without have Solid results were not could the and our resilience delivered -- accomplished delivered of been dedication people. we

respectively. that through anticipate And their sales to million customers quarter. delivery coal taking of I ramping operating efforts, post reduce our the the and ARLP and meet working aggressively inventories to of To the capital our am to of quarter. million XX financial and we remain expenses, committed capital of has improvements the to and which the position disruptions to close requirements during successfully pandemic, this XXXX expenditures worked was reducing cash metrics tons, XXXX The of control significant up by production all maximize and and proud Our production coal organization mines worked through financial volumes increased full of flow liquidity. Alliance continue out XXXX able year tons contracted enhanced our approximately all during created and entire XX all XXXX, to businesses, tons our year. the our customers

and XX ahead move contract coal recently utility several tons demand Looking issued has and for terms. year, higher lower utilities in the solicitations million inventories energy commitments significant recovers to for commitments pandemic. with as next priced for continue multi-year economy post to approximately increased seeking expectations prices XXXX have gas currently supply natural ARLP

coal above levels. volume XXXX in We be are currently approximately targeting total XX% sales XXXX to

the continue improve to from of remainder year will segment our We mineral modestly throughout over and results also the XXXX. this anticipate

uptick companies. Our as in volumes, recent commodity in by E&P expectations well reflected the prices as and production activity the rebound the

we capitalized co-operations, to fully of keep focus activity cash maximizing and and from open questions. us to markets with As to location coupled inventories on segment see year. historical draw of to increase pace oil the the return located acreage, and this lid on conclusion, cash minerals, With operator the for next low down provide E&P return mineral continue keep companies the feel strategically -- ARLP and to long positions development. more our we quality to should the gas Due our I'll total unit operators drilling will increased holders, our balance, strategic completion stakeholders. to minerals, to main ARLP's generate ability flow fundamentals that, cost we In attractive due call -- with with of again their a normal access global for in the demand domestic incentivize our to ask will our returns supply and to capital long-term

Our ahead. Benchmark first Company. Mark comes from Please from go question Levin

on we a particularly was Okay. cost Thanks have congratulations, very leads this. to while, which the me side much that not in and seen something

So you're it there tons or saw near-term quarter-over-quarter. reasons comparable modestly why that thinking kind that QX, looks that XX second in sales, now for QX should the cost on million if be QX of up a assume you you wouldn't? performance like Does be of would in would when it be mean you

Some you? -- Mark, of the how are

I’m doing well.

for and question. thanks Thanks for the calling

Sure.

would up tons have of coming We of the will reduction railroads efficiently. with started Some We had operating We the XXX,XXX quarter are the some be -- targeted the hit our and inventory. quarter. XXX, volume we we transportation those, of XXX,XXX believe out do in ended probably delays. increase sales we more but last

get fourth quarter. last more think into been running to I the of able the to their and quarter back the they've workers month

that up fourth in So be slated quarter the picked in tons we will to do third quarter. believe the those had sold we be

something we're holidays. quarter. So the to be still some we'll similar targeting standpoint, a production produce from in There will --

COVID been because the cost quarter. be we won't our but might up should outstanding year an had back in think I'm that see, quarter our quarter, trend or out costs on of as capacity I Probably bit, in, in hopeful we're predictable so. impacted at as little we we've we as near what operating low be can can doing pace but the much that world a pretty So with quarter level stay a you a third next for be at full

good turn a of very 'XX me second. let That's just And kind great. news. to That's for

done tons million next for XX million either point, they've tell for or 'XX? you've million been I what tons can far those Where where at 'XX, you think it that have year-over-year Joe, priced with tons priced can do this versus relative you XX mentioned anything down if us shooting tons? about At have what this those year. up to of year, us roughly help or kind to so look and 'XX you been priced XX maybe you you

are. north and XX% XX% over solicitations balance, little I $XX unsold And tons think of is look of lot that basin a right the million Illinois for I to that gas $X prices Appalachia XX and you to the are the when a natural pricing unsold as the it's right today. We've ton. about got at out tons tons now where then think

-- So fourth we what up, been ton we targeted million able what do and quarter XX of at rate. run off in the really running or third plan we've that that that quarter. XX.X We're the X.X XX% to do to

And maintaining that pace. just so that's

to our final the the the shut But things to shouldn't if good will bottom we ought happen prices does all planning down, but and economy that the be based to able volumes, line and for happen planes fly, We is, lot we're what's affect is. going it that least trying what's they on going a increased gas operate that with our to analysis not people a go demand COVID, that million comfortable for see strip with and quarter economy to what maintain are hopeful those what at going believe gets we're to the with of can understand uncertainty does election X.X we to the is continue production. where

above upper price pricing And 'XX, prices? look coal of to we basin they and with been XXs? and prices you are XXs rags are Where the when out tend at at into for still obviously the they calendar would moved Are kind gas you with priced, look different starting and tons now put you 'XX on the moving not now? that that characterize they guys have But I it calendar mid up gas? historically. see now how higher? in Joe Or to Illinois it's moving Are they numbers

have probably of the think I within the solicitations in going either there's think of the publications you happened are first nine quarter. to what not dealing next longer I those And quarter they're are part dealing see the And term or all all market. happen spot major with that different with this and market, are term.

to in is that are We can't X the a coal years. million minimum just sell structure is industry see they're at as base the years. [indiscernible] two basis Northern those that [indiscernible], a indexes not on those or Illinois $XXX them of the up So are sustainable. we support doesn't -- that and XX it's the but can't prices in large you [indiscernible] publications for of we There's in an cost -- have market that multiyear day prices. Nobody

price of those details expect solicitations for So quite in pricing with seeing the would that what is get but right a than you're as fair I a into come that, we're I customers. what middle higher in the in will bit to the our publications. can't

then else with cash to And question, final very someone let It and do That’s helpful. I'll has allocation. my have.

guys superb you debt. a done have paying down job So

down sub got your X.Xx. You've leverage ratio to

terms is you -- guess want go? we to either the on of finally deleveraging? kind still sheet, does what into there hold then here, and number So priority those play net kind is priority Do I in distribution investments, the or balance And where it my question gas a target continue now. How one, are of are just absolute, is Is your or oil from do -- -- priorities? number? it a of

additional sheet some investment. capital just general distributions on maybe allocation So Thanks. thoughts versus balance

forward. normal, is is the or going old what's like to there is is -- normal, Okay. normal. stability Again see there we'd a normal new What new what -- the the

stay what the run we is cases vaccines, to have will the get be. whether to whether the many got through when to have be is things things able economy talking spike to day before So of a types when are more how about those stable going we know and going other headlines the work, this, people than open, we've back to rate

until the decision happens, our Board So that suspend made distributions. to

make January We that quarter. predictability we So going an as we this for to announced distribution not the decision a primarily quarter, answer the fourth pay the make cash to believing of not we're by have that did distribution not flows to are. will what

the better flying, is either it's So that all different delayed the we'll Board hopeful with answer With whether vaccines, decision election the meeting. our and open, we've going until time clarity. April of how or the have not We're by are issues those future. economy to with that us airplanes open are help provide to

we know thing mentioned major known have of we I other is -- The earlier. solicitations the that then will by will outcome the

can in focused stabilize and So a in generation our consider to in and mentioned and believe we be to it be, where now distributions Right as prudent focused as comfortable confident flow we us a in again. as -- that being put industry. we maximizing be possible, I comments, efficient cash will producer very opening to be trying position position be low my feel cost and we'll we're low a will on, can challenging a costs keeping as flow, as as on as cash our to

talked But about today, is love reduction paying or the more as it's So options. We'd before, will earnings we'll the or continue on a yes, we've is or clarity focus down units buy determine distributions and what on we like are to us down making other pay debt table that everything setback we're able not for from. debt give acquisitions. do entire on rebound whether back gives We then oil the the company. like of gas make that grow We and us have to years XX to industry, a to comes And we've acquisitions. only feel that to our going industry. and history And company. do but it that's COVID coal to been want our for the our

be good want past, We're been that side. to and So in it make deploy but merged on underwrite these gives capital of of minerals? has really on questions is Exactly do than a us lot going how how the to been need to acquisitions lot it to have can investments disruptions companies thing, seeing we do. deploy we there's we harder a year side. mineral mineral Yes, there's of -- lot we this That the where they're those because it. and understand a the a going also are in

Given the position we're where what good we're minerals in are, we shape think for bought.

the got -- in future. figuring we Now by on we what do go out the

price, it's are to whether commodity just -- or the value be hard proposition But not we'll values there's and a the to will we so that. seller the what's know relative granting policy timing the buyer market. transact be will what’s to of -- permits that in be to to able what government permits. the going granting And what's be Yes, on how between going and drilling,

most answered of that hopefully So your questions.

congratulations Absolutely. again quarter. a And on super It did. cost Thanks.

Thank you.

from comes question with Lucas ahead. Please go Securities. B. next Our Riley Pipes

strong to done. to Hey, cost everyone. quarter And on I'd Well good add my congratulations a like the very side. morning,

you. Thank

may to I first wondered but quarter-over-quarter or maybe mix, it mix, wanted provide you would really you various touch with little cost lower on predominantly the So input maybe I provide? down additional my bit wondered, cost could either is into buckets? breaks further factors, a by be side bridge question. possible I any mentioned a driven it's appreciate besides able that color -- year-on-year you to improvement the

have I it's critically inventories bit just materials Wow, has That's of I by think item operations inputs line of a looked really challenging. a response across has looked haven't costs, very to down at focus detail, on Lucas. helped will mean to cohesive to not and supplies evaluate Clearly bit this strong helped. all in multifaceted board at form line it been that's be give I quite a item. a getting Lucas. at fair. I our mean, it. but is into it that I try bringing the focus, detail, level by

of it, did XXXX, We Just XXXX North operation. I you're mean, things, recall to operating side down cost. of can in that XXXX, we our was up back closing ended higher versus a have to if comparing couple which a part the mix the you [indiscernible] Gibson

of So XXXX have costs numbers. have some some closing there cost the sort of that been burdened

COVID course, of Of the impacted quarter second XXXX.

to an had able the we've challenges in back basically So to you came back very manner, people pay when to pay in from focused was and every to. we back the attention attention were we that, that bring urgency detail everybody to efficient can

year-over-year is got We in a the haven't factor September. that we're Another mine. had even because we [indiscernible] Kentucky. these lower yet, not transitioning just Those East in rolling really been benefited high numbers in cost operation yet to mine,

So be quarter relative relative a on bit a But cost the it in well third as to will year. a feeling as second year-over-year. numbers helped basis the our of some driver we're that lower little last quarter,

major So productivity. I think to bottom line. those just down really are It's and things it gets the

mean, When in nicely. ramped per they've it's I basis, our producing you're quarter. obviously back volume, fixed up meaningful. And the impacted very costs selling And a were on Right. second obviously across more tons volumes significantly more tons, those ton

-- very that, I so follow-up Very, to I topics questions may some second helpful. my but switch wanted question, quickly. Yes. really have on

you. With what's opinion, to next the coal Thank week industry, your ballot? the it the election on in as relates

he's then wants fossil I to XXXX, Well, I'm generation says, know. all he he's sure has be is. it, Biden he not fracking, against what stated think to all for or fuels. position hard He I against utility he's mean, it. and Joe by not that his it's says

vehicles, coal I space, We've we advisors So policy transition of It's -- do Biden specific that importance election XXXX meetings really not some was how think that me, I mean, importance surrogates are. call to based or coal sense on But in to being gas ballot. for a can of want industry. we what's not the a that what convert one his fuels. is to and their 'XX coal, really increased to me camp solar that in electricity us focus energy that you doesn't they the had on to promises I that respect, really to -- a coal, on the know company them -- the power to on then but electric don't wind the and energy the a nobody don't and would the from specifically given all over wouldn't to a as we want to demand yet make of industry, anticipate. and another that of with the what decision they'd assurance technology supply sector. they we the this low-cost oil you understand ballot I build means is to have than say his look XXXX fossil timeframe battery It his you think other campaign can understand making they plant

to we bells in those their as being because fully So and comfortable they because is how achieve physics say don't square the and can footprint sufficient have the is, those and We're our compliance, they don't are know. that operate plants we macro. I cost are From today. utilities -- I don't more micro footprint. want compliance, these my these lowest facilities plants what they're with are whistles environmental just are that -- it the than the all what know. trillion to circles, sell know maybe works that perspective, And this are at they to how and what objectives that laws there, you in get there $X know power for that that very look capitalized. infrastructure to confident They able to want I the written

XXXX operate some to cases -- XX in them XXXX. want they to So until

assets through with the focused et state your try plants And to those cost federal manufacturing, with the we're governments, to we've utilities keep they government with create working that so open. those lowest to cetera. And been the and protect jobs

advisor they understand like we’re more makes a hopefully of And rhetoric Biden what -- that, that campaign coal they these important policy elected get feel have to that in. contribution on that if instead the that believe the policies to says depending their were communities. would he that so to day, they're measured we'd that what we given would that be state is on And

the my think [indiscernible] wouldn't view there's no I have that question which So York that. under more coal the may the Obama been Times, under the this that But case. so that's believe believe that in damaged you was New you read I Trump,

our from divider. So would the a industry coal not he's perspective a remarks you I think then the be doesn't He's Trump people that jobs. at he the better all future or not a know, debate won. -- his he's President But he and closing if in Biden he's uniter, wants for was

be And he see, comments, see were wants way whether his it divider, that he if and he closing governs he wants that to we'll provider. would to be job be to win, do he what you jobs whether said to to part uniter to he does and of a do whether or be a so he destroy we'll or wants hater, want a that's a whether whether

I'm more We listening [indiscernible]. to hard the but how that, to many I it's yes, so, guess. And don't I people are I could, than know call. say sure

times. take to No, comes very company and up perspective. Joe, investors, I your you and these helpful It's and question team appreciate I really it's that during wish hear your among all your the best a and especially frequently

do these industrial opportunity we're producer. like they got power I to do they've be that our and panic. no a that bad cost if that company, there's for a us, States sufficient summary, for think bad time that base. our support going in low American, the a consequences here in I need a just And we Again, the thing. And shouldn't I'm transition, their represent. there's like to mean, over would they cost low they officials of you'd think elected for people again, respectful to right feel a but are amount unintended it convinced Yes, definitely that

Joe. Thank Yes. very much, Yes. you

Welcome.

from Fields America. comes ahead. next question Our from Bank go of Matthew Please

Hi, everyone.

million you’re made just to you I been think preliminary First, on that earlier XXXX might've might've a talking comment, the XX.X wanted follow-up where passing, for a in I about of be strip, is kind but It comment a level. number? $X about XXXX? guidance Brian ton did above There kind natural could little million of ton just that which XX upside at say gas current to

the I'm Joe said Yes. one that This that. Craft.

Sorry, Joe.

demand That's mean, I now, last much until week actuality we of or gas I the today demand mean, driven. seeing seen so. we're okay. how the the haven't like in is or $X until

in pushing we've run a So a trading yet been and rate lower quarter at we've gas, seen bit still third quite us. that's the

had X.X demand company Our a to X.X million ton rate.

driven So I above we believe been natural we when been, look I that has by I what don't demand know gas mean, personally it. has -- XXXX, don't at the prices because $X, experienced haven't

some market. be like if of projecting, go $X.XX $X, would the people the are to prices the what and at natural we looked gas So behavior

our to ignored that. for coal see economics we've numbers, to switching. and to we projecting gas upside like pure that the would So XX% would numbers, coal switching 'XX, suggest more if gas, there's a in it's increase we're when sizable But

So back whatever million still can maintain at X.X XXXX. of the that likely current with XX%, and is say number even economy COVID a we airplanes we run and working current rate less that that whatever run at less no flying can related, even that not for the looking that XXXX, economy for product just to and our at that which assuming rate demand still in the X, our see looked we normal is we we January get

that [indiscernible], mean, May, April to back and of the economy, win that it demand shut obviously I economy economy. he's Now like it second of year. of we're know shutdown quarter. again to the shutting he's to shut But like May -- a that if major as But to that the in down to don't not in April, and down did that have I come repeated impact that to try this we were in wins virus, economy. the shut back down Biden the going going not would the down assuming assumes if debate after Biden shut we don't who was we speakers]. go had a [multiple in the I'm no matter like had then

Okay.

gas So disruptions assumes of just it that kind no coal be strong of major also -- and million because ton to but assumes again, economic of switching [indiscernible] natural back XX to kind prices.

Correct.

you allocation. clarity then, on for Thank the And the I that Okay. clarification. appreciate capital

pandemic, and said the economy wait capital Mark your asked think of to meetings. April maybe want until to kind Board you to policy kind changes about I we no your see with of with and distribution happens the allocation the what

buying the paramount the So March is liquidity revolver cents but really want and your maintain cash at $X.XXX was. you dollar? you dollars. with can't ignore debt such that bonds some the the levels, presumably reasonably at repayment assuming at back at that kind quarter, the is, and September on $X.XX paying that in distress versus bonds question of positive, $X.XX, My that goes are we're trading back to point value availability, the revolver dollar $X.XX on on to like flow Appreciate December

banks that. buy much under back do be What visiting the to the to the doing can potentially of we try be bonds, banks. revolver We fair. advantage to we our back have but as to going will take ability we'll with is That's restrictions as interim in get flexibility to

that we So go that to can. direction, we choose do if in

limited. are in fairly bonds on They volume point given time our publicly the closely fairly held. traded, level that of recognize to have any at are also but You is

unknown a ability much to market to transact any the clearly the time. and to our and this as in otherwise ability market question, participate bit get an our in advantage where flexibility at the be are assessing what very we'll in the as is actually open math to your of we answering I to believe go So can working at strong available take today terms trading scale point in cost capital. of But type in of is in and of of bonds

back bonds? have of you you your today give can So via available much buy [ph] us So capacity right? an limits revolver cash estimate how this concept, just kind of RPs to

maybe and can just back go how the get. to to through flexibility we'll work we Well, much see banks that

good and All right. much very Okay. luck. Thanks

Thank you.

Jarmoszuk with comes Our next ahead. question from Stifel. Please go Nick

to color any tons that the 'XX earlier. How on of the contracted. think How of those from tons morning. multiyear well? can of as carried appreciate I additional little hoping was terms? those are I about contracts XXXX the Good get many Are commentary current a the book. over we

that over delays remember. would carried that have shipment from mean, are many too the only I carry they not XXXX. I over reason There's

That's right.

don't going times I can't don't do off -- top as 'XX how we we've recall head I Brian? have 'XX, in you got that, So my the of into many of 'XX. I think and -- committed

we've Yes, well. some I in as million think we've committed volumes got timeframe out this committed 'XX. time about point got the in At X.X into 'XX

-- longest would that that company the the you term -- What’s that would entertain?

XX-year We … would entertain contracts

At an appropriate price.

-- or … have would well, a at reopened. structure that

Understood. Okay.

marketing, of gets there be. too far that always party needs contract out a market. good We've either We for to believed is If [indiscernible]. close believe to it's not good it one

some want so do supply we. they would of to they security it mechanism mechanism close would some we want and that So market, want keeps but and

So I next to need lenders telling it years. be our or encouraging that, whether listen, to investors here several we the I the think customers are bondholders XX that our we've or think you markets, XX that for got it's XX that

security we supply. So need

those want we to is, it that protection think -- and and responsible if So definitely enter would protection, get pricing allows the us [indiscernible]. that's types positive operator, they're going be if we agreements, I want a of to whatever into

construct [Multiple we've pricing and over both time band the sides to to described, as reopeners a move, possible to Speakers] minus ability sorry, market the is close you just as or for plus have periodic keep what seen Joe where that type within of historically.

it the going Okay. new in been -- if terms are customers plant changes pretty can you of of in plant And terms any then stable? the are power power you is it's or have any been how there shipments describe just or mix, historically, where adding

stable. there's each our up. that and of share we've sure pretty I basically, But seeing you're but I mean, I go mean, there's shipped seeing customers. to trying It's targeted that we build I'm because market got that suppliers some to our haven't fewer through before, it's think people you're

gas it's same and answer the I to the just out is share. same market that, it's higher the cost in pick that question -- plant. market think the it's go customers, up no, your It's we the some it's

that get coal power like, the the the spec what's plants are then And What reception you the you see? to or sold to? store? for Is what’s not hurdles historically you have it that get difficult

Yes.

customers taken some talk and at too. getting basin they how do -- in have -- have -- picked of the operators, definitely been what we generation we've coal. we that being as are of our generation, because say. the lower to into Illinois operation historically someone long-term to And a are basin us sheet river we've sulfur there industry up only they all the Gibson the area. want for plants reliable committed our we're But strength how got are marketing that balance that capabilities product at some us we and we And So our and that and volume the look to coal-fired see we targeting

is that reception good. So

think one sold. about plant have any thermal I any is we really built haven't we tons don't thing for XXXX into market export volume the in the and talked

of XXX,XXX tons Next and looking product we're around year metallurgical XXX,XXX [indiscernible] out there. we at does are going [indiscernible] our into PCI at MC bid and the market looking

the into to export going built but into X XXXX we So XXX,XXX million got market, all X be could that our tons there related it's million tons, plan.

for subject does give in your the you're balance and post in then you when advantage bankruptcy on sheet going sheet competitors Okay. balance who reorg, either RFPs? of And your are potentially

Every are. solicitation not does it does. our says that customers it or [indiscernible] Whether

Thank time. your appreciate I you. right. All Okay.

Please Lin Our next question with from comes go ahead. Shen HITE.

good Hey, question. taking Thanks for morning. my

the want for Just clarify XXXX. to cost

the that given expect producing are for lower million XXXX you the and what we XXXX, I so XX should be mentioned than [indiscernible]? you for you think to next year, next or year cost that be think to cost assuming going about predictable

that mean, believe right be I we XXXX. Yes, would slightly now, than I think lower we that

or think it. gas about to to couple coal Got talk coal industry back demand you the of think -- parity [indiscernible] ago, a also I price. cash guys years also to the And I

there $X gas, utility I what see [indiscernible] demand don't next price, you’re but So the see think COVID-XX the should the coal understand given gas demand, also pressure now, change the we ESG part? bullish for about coal or very above even year. for the given about is to for parity and we policy like I new, like

And we're guidance sales we're we're telling can that just I maintain cautious. in we've what other I'm assumed natural bullish. I not saying you don't not factored not earlier, that have that think believe guidance, just than at giving actually Well, I All is not I we would would we're the I said X.X. that it's say characterize or in we -- gas.

so way on the that. And I or offer didn't other an one opinion

upside fact, most In suggesting goes I'm you haven't people just will into to like higher there gas and that stays be it at number. we $X think, if built that

Lin, it activity. which reflective economic of starts power is demand, with

is gas with It point coal close to we -- at to environment. is, you very if difficult switching and to So just or the where that it back levels likely in natural gets time. pricing predict in see to recover, it, this pre-COVID will does economy gas

characterized like. hopeful, power demand Joe. next So demand where what economy I we're we've back not looks with that year, agree it coal the think we'll to don't and gets overall stronger I but see that is

our consider your of years coal but pressure. I like ESG [indiscernible] before, need just about the guess, clients, to okay. feel that, party, we [indiscernible], versus need because also the or energy consumption of on now increase a of ago I do top couple parity press about they to that Yes. utility we when you gas clarify. $X, are If same to talk want talking you to

need -- same you feel of kind price same you conversion. the couple do feel to ago? gas little thing So bit Do like or we higher gas the years of way, that probably

put on -- what not be to to position our be gas not a therefore caught willing to a where the seeing side. to that not from be want overbought don't make and where curve proves they long [Indiscernible] coal commitment do we're does the be curve. they've customers, to prove They gas a want to they're on volatile, in

So asked is what optionality. they've more for in flexibility

where that gas going saying, we and not for to if to we prepare you want be And but I'm will So customers that be to optionality are for commit have can it happens, you price, it. us, I there a seen us can higher well, covered. that to give

dependent much can't the not with sell But that. on that on that customers that, million going customers be we're But, to occurring. we're confident that it's gas the going and on predict customers reasons solicitations comfort as not backwards, is story. comfortable absent production to and is happens if Brian's So with want But a are And and we're based because one going to willing assurance seeing that that that that you we're economy. happen no back Biden XXXX, in exactly a commit degree tons some confidence position I I’ve conversation prices. give matter we what's they're shuts what of that's economy based the the that different -- I a I to backwards. we’re no, to say XX of to us, a generation confidence they've cautious, mean, I'm comment, believe conversations with a to going can the economy that around base in collapsing, goes down, quarter absent comes take trying our us tons X.X energy economy should and indicated to the just from million pretty that I our giving be to if case. And high target made

I one can if question, Last Great. more. squeeze

a demand production? XX% you can or produce higher cost have year, to increase similar high -- or have If cost, XX% some at see, you you if you you you still need can start next see production let's higher next see Do more probably year. demand to

the it's think I former.

we've at we got XX% think to equal because could incremental. lower generate I capacity. it's costs I or another excess mean,

a much go I above think we to not to that that another make try to challenge that some to is XX%. term need would it's go just beyond quarter-over-quarter try to sure

it. appreciate I much. very you Thank Great.

with [ph] Please Novak go Tim Advent. from ahead. comes question next Our

Novak, you gross debt Hi. Good like morning. you guys to? Do would a get have that to Tom target Advent.

in Xx [technical a see than if But target we I'd say can't [technical typically total difficulty] again, we Xx. EBITDA leverage. that, difficulty] we

of you've $XXX disastrous in think you year-to-date million pretty So done cash free flow I -- a year.

assuming, think Just and May your pay distributions, think of how you gross take any you you you entirely shutdowns you repay do assuming didn't April, curiosity, if would March, what you don't debt years balance? do just out again to many

to their cash mean, that maturity we'd type have flow of scenario, sufficient a I of pay schedules. completely our I think within all in debt down

mean, are right? and life the free rest at down a cash material I any just and you think to shut really companies equity of all? coal run with generate little that of yield debt why cash these to that then not guess to what high So level, permanently is maybe it's a I'm the debt flow holders unreasonable I just assets? secured lot Why out levels in debt at take Yes. getting de pay free bit market, the out flow, not a in minimis bank the use of of scenario,

a trust. Well, grow, so to like we'd not we're

like would … speakers] [multiple to we So

using but that is financing? you -- grow But debt

beyond don't the zero market, but it the that finance Well, in may that to growing I the years, cash generating, using or flow the to we're flow of very runway, and And know from debt like that cash those already in to there's cash cash I balance on zero have XX-year conservative. that using I a bond generating debt Xx we investments generating a at we're putting in very, growth believe we that ways to debt mean, our that other the strong can of use financing, growth that that it forever that we have in we're a the I'd that we high segment. be and when of you we're growth that the to to next levels two flow support to we've have try think seems back that don't flow got -- it's think taking investments yield would the that in embedded I sheet. the we're And not cash do flow would made future cash mineral investments XXXX. make. be top appreciate flow. we I have our XXX% committed to EBITDA going a we

was of your towards to balance load, think question is the I the debt carry future our leading -- as can in sheet believe have a to in strong. I or look That will strong and company. reasonable that And a Xx what a flow That's net way. above or allow we conservative be that's today sheet. very to any reward today for our and going some business That's will forward. my grow shareholders balance today, that us use cash to we focus

Okay. much. Got it. Thank you very That's helpful.

next Our ahead. with question comes go Mark Please Levin Company. Benchmark from

cash more around with a again what is, my Peabody that having to coal Arch -- One I bond well, third-party like asked minimum allowing bonds have is liquidity is heard And then And maintain? question cash guess and you to follow-up. recently, -- the is to liquidity -- related collateral amount minimum liquidity there potentially two around them calls questions. comfort Brian, is, surety I are for a; bonds. there provide third-party backdrop or or surety about bonds, Thanks. asked more collateral companies of corresponding a from b; you before Yes, several and been regarding surety you of want that level? against surety other Question there then, providers collateral? we've me thanks a

Yes.

Let the first, that part second Mark. question take me of

between [indiscernible] surety comp, and our $XXX million workers' other bonds amount the year-end total bonds, obligation were roughly place in at asset think of bonds, so. or performance retirement I

Okay.

collateral, a not an appropriate but sureties just What with market, the obviously industries many fluid relatively been of as in is really very increase. It's some our modest. we've across space, board reassessing. are It's seen level

we're does to outstanding place. total than it remain only at in insurance collateral manage still how fluid XX% point bonds in with companies, surety I but total with time is think providers, very that. our our cetera, and talking best not on our of But this less our et

probably that a in manage market million $XXX clearly at In we'll focused like. your I that terms overall overall been so the collateral on through think requirements capacity or generally to to we've trying in what And as each range continues somewhere be and to evolve. of looks increasing liquidity, minimum availability

great answer. appreciate That's there. you. a clarity Thank all the I

Sure.

question next comes from Our Please Private Johnson. go Investor, Sam ahead.

taking Two for good you call and Thank congratulations quarter. questions. my a Yes. on

what's Shell respect And stock why role not? Obviously, a Total, a regard? moving And lot -- -- also acquisition you renewables? do split? of you renewables thinking that companies, the see company What strategy area. First, have touched What and to what not, you with you how oil or others are folks on for reverse BP, into considered if do earlier. your your in

had valuation mineral getting to thought to of they’re unlock we we're what to the stock future. in that -- value what continuing find I split ways we're the the our for For understand segment, can and assets understanding how and flows question, cash try the we where the of particularly our the those prospects first company, feel bring like not proper are

a one it's and and sector in about is mean, long-term to of that the the markets that any split So and evaluate, get I the tools enhance short-term. haven't we talking now total. going that the would just be going traditional assurance continue right value that can't energy stock because have for could recognized felt we're might is any way matter. I that in of so tools today the just doing to as treated of hard the that -- be appreciated out I we areas the

tool I hasn't we of many It's Relative continue a should merger, again, to that in it timing M&A, why that understand it the consider would from happen is, really beneficial to seller's that it is need a list relative to trying your trying made understand think that It being happened the and there more today. statement but the think and again, question a a perspective, I've happened things to to is that I on I that the of election. times, the all. decision not the a with future? for means, So from be climate difficult. it that's But -- in our makes [indiscernible]. industry could that shareholder on -- what given buyer's what as to Arch Peabody consolidation. perspective We believe

we're So industry. that their see by that's side, leverage producers coming leverage driven starting E&P in largely together occurring the to the and/or on

buying think owners to going have what going going of take to best, -- to going not. of willing have and/or then other way as determine the it's some close driven happens that by Lucas's And to that on I have the about to type to community and is we're eventually the to going best if the investing whether probably by industry, to in players to see industry all be will communications. some is So coal to have I money be consolidation, a you to That'll saying come in and will at come have lenders -- I is of everybody administration. those been more participate, mean, the you what under or election somehow to And wait that the question, of to the what's investors, one to Then private that you you've Boards owners are together it. to lenders industry evaluated industries and the the stakeholders the we earlier have if see like got management have what's et the those party [indiscernible] look a that assume to I -- we'll [indiscernible] someone is space, happens and influenced and coal do when believe seen interest money, by to from what of so And have going cetera. lot what encourage we think the it's to a both public than these that think investment, runaway take companies. is catalyst investment the

you. Thank Okay.

for the back any This Vice closing Cantrell, remarks. turn Brian I to Officer, concludes over session. our and would Financial Senior to President question-and-answer Chief conference like

this thanks your time of as the Matt. as to robust morning Alliance. you, everyone continued and And well discussion Thank for support

next quarter call in Thanks to Our We late fourth expected discuss for our participation. that all operating financial is your results you'll call rejoin and time. occur to our for at This hope to January. concludes again us today. currently

presentation. is you today's conference concluded. now The Thank for attending

may now disconnect. You