CANONSBURG, Pa., April 8, 2020 /PRNewswire/ -- During the
first quarter of 2020, CONSOL Energy Inc. (NYSE: CEIX) took several
steps to reduce its outstanding indebtedness, enhance liquidity and
supplement access to capital.
On the liability management front, CEIX repurchased in the open
market approximately $43 million of
its Second Lien debt that continued to trade at a significant
discount to its par value. These repurchases provide a high rate of
return and are credit accretive. In aggregate, when coupled with
our Term Loan A, Term Loan B and finance lease repayments during
the first quarter, we retired more than $50
million in principal with no material change in liquidity
from year-end 2019.
On the liquidity enhancement front, we completed multiple
transactions during the quarter to provide additional sources of
low-cost capital and to improve financial flexibility. First, we
closed a sale-leaseback transaction on a set of longwall shields,
which provided net cash proceeds of $16.3
million. The interest rate on this transaction is
approximately 5.6%. Second, we secured a commitment to provide an
additional $20 million of credit for
IT infrastructure and other equipment expenditures. Finally, we
successfully amended our Accounts Receivable securitization
program, extending the maturity to March
2023 from August 2021, while
keeping the size of the facility at $100
million.
"Our primary focus is on the safety and well-being of our
employees," said Jimmy Brock, President and Chief Executive
Officer of CONSOL Energy Inc. "Each day brings new challenges, and
our team remains focused on managing for the best outcome for our
employees, the company and all stakeholders. I am also pleased with
the execution of our Finance
team. In such a tough environment, they executed a series of
transactions that not only allow us to maintain high levels of
liquidity on our balance sheet but also meaningfully reduce our
absolute outstanding debt."
CONSOL Energy Inc. and CONSOL Coal Resources LP Guidance
Update
The coal markets have been challenging, first due to the
previous softened demand from warm winter weather and additionally
amidst the ongoing COVID-19 pandemic. We are monitoring the ongoing
impacts of this pandemic and taking steps to mitigate the potential
risks to us posed by its spread. This is a rapidly evolving
situation, and we will continue to monitor developments affecting
the coal markets, logistics and end-use demand and will take
additional precautions as we believe are warranted. The extent to
which the COVID-19 pandemic may impact our results will depend on
future developments, which are highly uncertain and cannot be
predicted, including new information concerning the severity of
COVID-19 and the actions taken to contain it or treat its impact,
among others.
Given the ongoing uncertainty, CEIX and CONSOL Coal Resources LP
(NYSE: CCR) are each withdrawing their previously announced
operational and financial guidance for 2020.
About CONSOL Energy Inc.
CONSOL Energy Inc. (NYSE: CEIX) is a Canonsburg, Pennsylvania-based producer and
exporter of high-Btu bituminous thermal and crossover metallurgical
coal. It owns and operates some of the most productive longwall
mining operations in the Northern Appalachian Basin. Our flagship
operation is the Pennsylvania Mining Complex, which has the
capacity to produce approximately 28.5 million tons of coal per
year and is comprised of 3 large-scale underground mines:
Bailey, Enlow Fork, and Harvey. The company also owns and operates
the CONSOL Marine Terminal, which is located in the port of
Baltimore and has a throughput
capacity of approximately 15 million tons per year. In addition to
the ~669 million reserve tons associated with the Pennsylvania
Mining Complex and the ~21 million reserve tons associated with the
Itmann project, the company also controls approximately 1.5 billion
tons of greenfield thermal and metallurgical coal reserves located
in the major coal-producing basins of the eastern United States. Additional information
regarding CONSOL Energy may be found at www.consolenergy.com.
About CONSOL Coal Resources LP
CONSOL Coal Resources is a master limited partnership formed in
2015 to manage and further develop all of CONSOL Energy Inc.'s
(NYSE: CEIX) active coal operations in Pennsylvania. CCR's
assets include a 25% undivided interest in, and operational control
over, the Pennsylvania Mining Complex, which consists of three
underground mines - Bailey, Enlow Fork and Harvey - and related
infrastructure. For its ownership interest, CCR has an effective
annual production capacity of 7.1 million tons of high Btu North
Appalachian thermal coal. More information is available on our
website www.ccrlp.com.
Contacts:
Investor:
Mitesh Thakkar, (724) 416-8335
miteshthakkar@consolenergy.com
Media:
Zach Smith, (724) 416-8291
zacherysmith@consolenergy.com
Cautionary Statement Regarding Forward-Looking
Statements
Certain statements in this press release are
"forward-looking statements" within the meaning of the federal
securities laws. With the exception of historical matters, the
matters discussed in this press release are forward-looking
statements (as defined in Section 21E of the Securities Exchange
Act of 1934, as amended) that involve risks and uncertainties that
could cause actual results to differ materially from projected
results. Accordingly, investors should not place undue reliance on
forward-looking statements as a prediction of actual results. The
forward-looking statements may include projections and estimates
concerning the timing and success of specific projects and our
future production, revenues, income and capital spending. When we
use the words "anticipate," "believe," "could," "continue,"
"estimate," "expect," "intend," "may," "plan," "predict,"
"project," "should," "will," or their negatives, or other similar
expressions, the statements which include those words are usually
forward-looking statements. When we describe strategy that involves
risks or uncertainties, we are making forward-looking statements.
We have based these forward-looking statements on our current
expectations and assumptions about future events. While our
management considers these expectations and assumptions to be
reasonable, they are inherently subject to significant business,
economic, competitive, regulatory and other risks, contingencies
and uncertainties, most of which are difficult to predict and many
of which are beyond our control. Specific risks, contingencies and
uncertainties are discussed in more detail in our filings with the
Securities and Exchange Commission. The forward-looking statements
in this press release speak only as of the date of this press
release and CEIX disclaims any intention or obligation to update
publicly any forward-looking statements, whether in response to new
information, future events, or otherwise, except as required by
applicable law.
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SOURCE CONSOL Energy Inc.; CONSOL Coal Resources LP