Peabody Reports Preliminary Results For Quarter Ended September 30, 2021
October 18, 2021 - Peabody (NYSE: BTU) today announced preliminary unaudited financial results for the third quarter 2021. The Company expects to report third quarter revenue of $670 to $690 million, net of $238 million of unrealized mark-to-market losses related to forward pricing hedges; net loss from continuing operations, net of income taxes of $55 to $75 million; net loss attributable to common stockholders of $40 to $60 million; and Adjusted EBITDA1 of $280 to $290 million. Peabody posted $193 million of cash margin in support of forward pricing contracts ending the quarter with $587.0 million of cash and cash equivalents and has retired senior secured debt of nearly $250 million year-to-date as of October 15, 2021.
"The preliminary financial results we reported today continue to demonstrate the disciplined approach we are taking to control costs, expand margins and reduce debt. Coal sales to customers were in excess of $900 million, the highest level in seven quarters. We remain optimistic about the future given strong coal pricing and global demand fundamentals," said Peabody President and Chief Executive Officer Jim Grech.
The increase in adjusted EBITDA compared to prior year of $95.4 million is attributable to higher realized prices from robust seaborne coal demand and a $26 million mainly non-cash gain on the sale of Millennium. In the third quarter, revenues and net loss attributable to common stockholders was negatively impacted by approximately $238 million of unrealized mark-to-market losses primarily related to coal hedges contracted in the first half of 2021 which effectively locked-in the sales price on 2.1 million metric tons of expected production at the company's Wambo Underground mine with settlements of 1.4 million metric tons in 2022 and 0.7 million metric tons in 2023. These hedge contracts were placed to support the profitability of the mine by securing average prices of $84 per metric ton through mid-2023 as part of a strategy to extend the expected life of the mine.
Third quarter cash flows were impacted by $193 million of cash margin requirements related to the aforementioned mark-to-market losses and $47 million cash used to retire $63 million of debt, partially offset by additional ATM equity sale proceeds of $112 million (9 million shares issued). During the quarter, the company completed additional debt-for-equity exchanges by issuing 2.2 million shares of common stock in exchange for $30 million of senior secured debt. Subsequent to September 30, 2021, an additional $30 million of debt was retired, resulting in total senior secured debt retirements year-to-date of approximately $250 million.
Peabody expects to report full financial results for the quarter ended September 30, 2021 on October 28, 2021.
The preliminary financial results set forth in this release are based on the information available to us at this time. Our actual results may vary from the estimated preliminary results presented here due to the completion of our financial closing procedures, final adjustments and other developments that may arise between now and the time the financial results for the quarter ended September 30, 2021 are finalized. The estimated preliminary financial results have not been audited or reviewed by our independent registered public accounting firm. These estimates should not be viewed as a substitute for our full interim financial statements. Accordingly, you should not place undue reliance on this preliminary data.