April 28, 2025 - Alliance Resource Partners, L.P. (NASDAQ: ARLP) reported a total revenue of $540.5 million for the first quarter of 2025, marking a 17.1% decline from the $651.7 million recorded in the same period in 2024. This decrease was primarily attributed to reduced coal sales volumes and prices, as well as lower transportation revenues. Net income for the quarter stood at $74.0 million, translating to $0.57 per basic and diluted limited partner unit, a significant drop from the $158.1 million, or $1.21 per unit, achieved in the first quarter of 2024.

In terms of expectations, the firm failed to meet both the adjusted. EPS expectation of $0.61 and the expected revenue figure of $579.91 million.

Despite the year-over-year decline, the company saw an improvement in net income compared to the previous quarter, with an increase of $57.7 million. This was largely due to higher oil and gas royalty revenues, which rose by 18.7%, and improved per ton costs at coal operations. Additionally, there was a decrease in depreciation expenses and an asset impairment charge that had affected the previous quarter’s results. Adjusted EBITDA for Q1 2025 was reported at $159.9 million, compared to $238.4 million in Q1 2024, but it represented a 29.0% increase from the sequential quarter.

In terms of coal operations, the Illinois Basin saw a 6.1% decrease in tons sold compared to Q1 2024, while the Appalachia region experienced a more pronounced decline of 22.7%. The average coal sales price per ton also fell in both regions, contributing to the overall revenue decrease. However, the company managed to reduce its Segment Adjusted EBITDA Expense per ton in both regions, with significant cost improvements noted in the Illinois Basin, driven by increased production and lower maintenance costs.

Alliance Resource Partners Guidance

Looking ahead, Alliance Resource Partners has provided updated guidance for the full year 2025, anticipating total coal sales volumes to range between 32.75 and 34.75 million short tons. The company has secured over 96% of its projected coal sales volumes for 2025, with domestic sales expected to surpass the 30 million ton target. This optimism is fueled by recent contracting activities and the strengthening domestic market, driven by higher natural gas prices and increased electricity demand.

Despite the positive outlook for coal operations, the company remains cautious about the oil and gas royalty segment, where lower crude oil prices are expected to impact revenues. Additionally, the company acknowledges challenges in deploying capital in this sector due to high seller expectations. Nevertheless, Alliance Resource Partners plans to remain active in seeking high-quality, value-accretive opportunities while maintaining a disciplined approach to capital allocation.

CEO Joseph W. Craft III expressed confidence in the company’s ability to navigate the evolving market dynamics, emphasizing the administration’s recent policy announcements supporting coal-fired generation as a positive long-term factor. However, he also noted the uncertainty introduced by trade policy changes and their potential impact on inflation and global economic activity. As a result, the company is focused on maintaining a strong balance sheet and carefully monitoring market developments to ensure financial stability and operational efficiency.

To see the full results with financial figures included, click here.