National Coal Corp., citing sluggish prices for its coal supplies, has reduced production and sales to conserve reserves as it reports a drop in second-quarter revenue.
The Knoxville-based company said Monday it had total revenue of $18.9 million through the sale of 372,341 tons of coal for the three-month period ended June 30. That compares to total revenue of $24.1 million on the sale of 455,548 tons in the same period in 2006.
The company posted increased net and operating losses compared to the prior-year period. The operating loss for the second quarter rose to $4.7 million versus a loss of $3.5 million in second-quarter 2006. National Coal's net loss for the three-month period increased 32.7 percent to $6.5 million compared to the $4.9 million loss in second-quarter 2006.
As of the quarter's end, National Coal had about $5.5 million in cash and cash equivalents.
"Recent market conditions have not been conducive to selling coal at a profit, (and) therefore we have chosen to reduce production and sales in order to conserve our coal reserves. Unfortunately, this has negatively impacted our year-to-date 2007 financial results," said National Coal President and CEO Daniel A. Roling.
Roling said that looking forward, there are signs that the coal market could strengthen, including increased electricity generation in the Tennessee Valley, normal summer weather, strong international demand, and declining central Appalachian coal production.
National Coal said the quarterly revenue decrease compared to the same 2006 period was because of a decline in sales volume and a $2.11-per-ton decline in average sales price.
The company plans to open a new highwall mine in Kentucky in the third quarter that is expected to produce about 20,000 tons per month for at least three years.
National Coal has coal mining operations in East Tennessee and Southeastern Kentucky and sells steam coal to electric utilities and industrial companies throughout the Southeast. The company employs about 230 workers.
AddFavorite 
-
+