Alliance Holdings GP L.P. (AHGP, Financial) filed Quarterly Report for the period ended 2009-06-30.
Alliance Holdings GP L.P. through its subsidiaries produces and markets coal primarily to utilities and industrial users in the United States. It produces a range of steam coal with varying sulfur and heat contents. Alliance Holdings GP L.P. is a limited partnership formed to own and control Alliance Resource Management GP LLC the managing general partner of Alliance Resource Partners L.P. a publicly traded limited partnership engaged in the production and marketing of coal to major U.S. utilities and industrial users. . In addition the company leases land and operates a coal loading terminal. . Further it engages in trading of coal as well as offers services including ash and scrubber sludge removal coal yard maintenance and arranging alternate transportation services. The company is based in Tulsa Oklahoma. Alliance Holdings GP L.P. has a market cap of $1.28 billion; its shares were traded at around $21.46 with a P/E ratio of 12.7 and P/S ratio of 1.1. The dividend yield of Alliance Holdings GP L.P. stocks is 7.7%.
General and administrative. General and administrative expenses for the 2009 Quarter decreased to $9.6 million compared to $12.6 million in the 2008 Quarter. The decrease of $3.0 million was primarily due to lower incentive compensation expense, partially offset by higher salary and benefit costs primarily related to increased staffing levels.
Depreciation, depletion and amortization. Depreciation, depletion and amortization expense increased to $28.3 million for the 2009 Quarter from $25.6 million for the 2008 Quarter. The increase of $2.7 million was primarily attributable to additional depreciation expense associated with continuing capital expenditures related to infrastructure improvements, efficiency projects and expansion of production capacity.
Interest expense. Interest expense, net of capitalized interest increased to $7.8 million for the 2009 Quarter from $3.2 million for the 2008 Quarter. The increase of $4.6 million was principally attributable to increased interest expense resulting from the 2008 financing activities, partially offset by reduced interest expense resulting from the ARLP Partnerships August 2008 principal repayment of $18.0 million on its original senior notes issued in 1999. The 2008 financing activities are discussed in more detail below under Debt Obligations.
Income before income taxes. Income before income taxes increased 13.3% to $40.9 million for the 2009 Quarter compared to $36.1 million for the 2008 Quarter. The increase of $4.8 million reflects the impact of the changes in revenues and expenses described above.
Segment Adjusted EBITDA. Our 2009 Quarter Segment Adjusted EBITDA increased $8.9 million, or 11.5%, to $86.3 million from the 2008 Quarter Segment Adjusted EBITDA of $77.4 million. Segment Adjusted EBITDA, tons sold, coal sales, other sales and operating revenues and Segment Adjusted EBITDA Expense by segment are (in thousands):
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Alliance Holdings GP L.P. through its subsidiaries produces and markets coal primarily to utilities and industrial users in the United States. It produces a range of steam coal with varying sulfur and heat contents. Alliance Holdings GP L.P. is a limited partnership formed to own and control Alliance Resource Management GP LLC the managing general partner of Alliance Resource Partners L.P. a publicly traded limited partnership engaged in the production and marketing of coal to major U.S. utilities and industrial users. . In addition the company leases land and operates a coal loading terminal. . Further it engages in trading of coal as well as offers services including ash and scrubber sludge removal coal yard maintenance and arranging alternate transportation services. The company is based in Tulsa Oklahoma. Alliance Holdings GP L.P. has a market cap of $1.28 billion; its shares were traded at around $21.46 with a P/E ratio of 12.7 and P/S ratio of 1.1. The dividend yield of Alliance Holdings GP L.P. stocks is 7.7%.
Highlight of Business Operations:
We reported Net Income of AHGP of $41.1 million for 2009 Quarter compared to $36.2 million for the 2008 Quarter. This increase of $4.9 million was principally due to improved contract pricing resulting in an average coal sales price of $46.04 per ton sold, as compared to $39.50 per ton sold for the 2008 Quarter. The ARLP Partnership had tons sold of 6.2 million and tons produced of 6.3 million for the 2009 Quarter compared to tons sold of 6.6 million and tons produced of 6.5 million in the 2008 Quarter. Increased operating expenses during the 2009 Quarter primarily reflect the increase in labor and labor-related expenses, as well as higher sales-related expenses, maintenance costs and other factors described below.General and administrative. General and administrative expenses for the 2009 Quarter decreased to $9.6 million compared to $12.6 million in the 2008 Quarter. The decrease of $3.0 million was primarily due to lower incentive compensation expense, partially offset by higher salary and benefit costs primarily related to increased staffing levels.
Depreciation, depletion and amortization. Depreciation, depletion and amortization expense increased to $28.3 million for the 2009 Quarter from $25.6 million for the 2008 Quarter. The increase of $2.7 million was primarily attributable to additional depreciation expense associated with continuing capital expenditures related to infrastructure improvements, efficiency projects and expansion of production capacity.
Interest expense. Interest expense, net of capitalized interest increased to $7.8 million for the 2009 Quarter from $3.2 million for the 2008 Quarter. The increase of $4.6 million was principally attributable to increased interest expense resulting from the 2008 financing activities, partially offset by reduced interest expense resulting from the ARLP Partnerships August 2008 principal repayment of $18.0 million on its original senior notes issued in 1999. The 2008 financing activities are discussed in more detail below under Debt Obligations.
Income before income taxes. Income before income taxes increased 13.3% to $40.9 million for the 2009 Quarter compared to $36.1 million for the 2008 Quarter. The increase of $4.8 million reflects the impact of the changes in revenues and expenses described above.
Segment Adjusted EBITDA. Our 2009 Quarter Segment Adjusted EBITDA increased $8.9 million, or 11.5%, to $86.3 million from the 2008 Quarter Segment Adjusted EBITDA of $77.4 million. Segment Adjusted EBITDA, tons sold, coal sales, other sales and operating revenues and Segment Adjusted EBITDA Expense by segment are (in thousands):
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