Coal Production Guidance Lowered to 58 Million Tons CNX Gas
Production Guidance Raised to 89 Bcf PITTSBURGH, July 30
/PRNewswire-FirstCall/ -- CONSOL Energy Inc. (NYSE: CNX), a
high-Btu bituminous coal and natural gas company, reported net
income attributable to CONSOL Energy shareholders for the quarter
ended June 30, 2009 of $113.3 million, or $0.62 per dilutive share.
This is 12% higher than the net income attributable to CONSOL
Energy shareholders of $101.0 million, or $0.54 per dilutive share,
for the quarter ended June 30, 2008. "2009 continues to be a
tactical year for the company," said J. Brett Harvey, president and
chief executive officer. "CONSOL Energy is reacting to ensure that
coal production is in line with demand in a weakened economy. As a
result, we've lowered our 2009 production guidance to 58 million
tons. Our goal is to preserve per ton coal margins by not building
inventory and controlling costs. Our financial strength, coupled
with the completion of some existing efficiency projects, should
ensure that CONSOL Energy will emerge as an even stronger
competitor when the economy rebounds." "At CNX Gas," Mr. Harvey
continued, "we've raised production guidance from 87 Bcf to 89 Bcf,
as results from our Marcellus Shale and coalbed methane programs
continue to exceed expectations." FINANCIAL RESULTS -
Period-To-Period Comparison Six Six Quarter Quarter Months Months
Ended Ended Ended Ended June 30, June 30, June 30 June 30, 2009
2008 2009 2008 Total Revenue and Other Income $1,070.6 $1,210.9
$2,289.3 $2,236.6 Net Income attributable to CONSOL Energy
shareholders $113.3 $101.0 $309.2 $176.1 Earnings Per Share -
diluted $0.62 $0.54 $1.69 $0.95 Net Cash from Operating Activities
$316.5 $323.9 $566.2 $470.0 EBITDA $281.6 $266.5 $671.1 $479.2 EBIT
$174.1 $170.7 $457.4 $290.7 Capital Expenditures $196.9 $259.9
$496.4 $436.3 Cash (Provided by) Used in Other Investing
Activities* ($5.7) $0.9 ($50.3) ($16.5) In millions of dollars
except per share. Amounts for capital expenditures do not include
amounts for equity affiliates. *Represents net cash (provided by)
used in investment in Equity Affiliates and Proceeds from Sales of
Assets. Quarter-To-Quarter Discussion of Financial Results Total
Revenue and Other Income was $1,070.6 million for the quarter ended
June 30, 2009, compared with $1,210.9 million for the June 2008
quarter, or a decrease of 12%. The decrease was due to lower gas
pricing and lower coal sales, but was partially offset by coal
customer contract buyouts that resulted in $14 million of (pre-tax)
other income. Net income attributable to CONSOL Energy shareholders
and earnings per share were $113.3 million, or $0.62 per dilutive
share, for the just ended quarter. This compares with $101.0
million, or $0.54 per dilutive share. The improvement was due to
higher coal pricing and higher gas production. CONSOL Energy had
net cash from operating activities of $316.5 million for the June
2009 quarter, with $87.6 million attributable to CNX Gas. For
CONSOL Energy, this compares to $323.9 million for the June 2008
quarter, or a decrease of 2%. CONSOL Energy had total capital
expenditures of $196.9 million in the June 2009 quarter, with $80.2
million attributable to CNX Gas. For both CONSOL Energy and CNX
Gas, quarterly capital expenditures in the June 2009 quarter are
lower than the March 2009 quarter, as expected, as some projects
already underway move toward completion. Liquidity As of June 30,
2009, CONSOL Energy had $371.0 million of short-term debt and
$461.5 million in total liquidity, which is comprised of $100.7
million of cash and $360.8 million available to be borrowed under
its $1.0 billion bank facility. As of June 30, 2009, CNX Gas
Corporation had $81.0 million of short-term debt and $111.7 million
in total liquidity, which is comprised of $7.6 million of cash and
$104.1 million available to be borrowed under its $200.0 million
bank facility. COAL OPERATIONS- Period-To-Period Comparison Quarter
Quarter Six Months Six Months Ended Ended Ended Ended June 30, June
30, June 30, June 30, 2009 2008 2009 2008 -------- --------
-------- -------- Total Coal Sales (millions of tons) 13.4 17.5
28.8 33.5 Sales - Company Produced (millions of tons) 13.3 17.0
28.6 32.7 Coal Production (millions of tons) 14.4* 16.6* 30.4 32.8
Average Realized Price Per Ton - Company Produced $56.36 $48.50
$58.08 $46.07 Operating Costs Per Ton $35.01 $32.03 $33.58 $30.20
Non-Operating Charges Per Ton $5.75 $5.44 $5.73 $5.30 DD&A Per
Ton $4.66 $4.14 $4.44 $4.03 Total Cost Per Ton - Company Produced
$45.42 $41.60** $43.75 $39.52** Operating Margins Per Ton $21.35
$16.47 $24.50 $15.87 Financial Margins Per Ton** $10.94 $6.90
$14.33 $6.55 Sales and production include CONSOL Energy's portion
from equity affiliates and consolidated variable interest entities.
Operating costs include items such as labor, supplies, power,
preparation costs, project expenditures, subsidence costs, gas well
plugging costs, charges for employee benefits (including Combined
Fund premiums), royalties, as well as production and property
taxes. Non-operating charges include items such as charges for
long-term liabilities, direct administration, selling and general
administration. Operating Margins Per Ton are defined as Average
Realized Price Per Ton less Operating Costs Per Ton. Financial
Margins Per Ton are defined as Average Realized Price Per Ton less
Total Costs Per Ton - Company Produced. *Includes 0.1 and 1.1
million tons of metallurgical grade coal for the quarters ended
June 30, 2009 and 2008, respectively. **May not add due to
rounding. Quarter-to-Quarter Discussion of Coal Operations Total
coal sales were down in the June 2009 quarter, as the weak economy
reduced coal burn at utilities and coal needs of steel companies.
"Because of the economy, CONSOL Energy is working with some of its
customers to restructure shipments. We have long term relationships
with our customers that we value highly, but we expect to capture
the value for our shareholders in the contracts we have signed,"
continued Mr. Harvey. Coal production was 14.4 million tons in the
June 2009 quarter, down from 16.6 million tons in the year-earlier
quarter. Mr. Harvey continued, "We will match our production with
actual customer shipments, so we will not build inventory. When
shipments rebound, so will our production." Average realized price
was $56.36 per ton, or 16% higher than in the year-earlier quarter,
due mainly to contracts signed earlier in a stronger market.
Operating costs were $35.01 per ton, or 9% higher than in the
year-earlier quarter. In general, operating costs per ton increased
due to the reduced amount of tons produced from CONSOL Energy
mines. Also, the longwall at Buchanan was idle throughout most of
the quarter, while the continuous mining (CMs) equipment continued
to operate. Tons mined from CMs are higher cost due to their labor
and supply intensity. Labor costs also increased $0.66 per ton,
partially due to labor contracts negotiated in 2007. Subsidence
costs also increased by $0.94 per ton, primarily due to additional
estimated Pennsylvania stream remediation requirements. Total costs
were $45.42 per ton, or 9% higher than in the year-earlier quarter,
with most of the increase coming from operating costs. Operating
margins were $21.35 per ton in the June 2009 quarter, an increase
of 30% from $16.47 per ton, due to higher realized pricing per ton.
Financial margins were $10.94 per ton, a 59% increase from the
$6.90 per ton, also due to higher realized pricing. Gas Operations
CNX Gas Corporation (NYSE:CXG), 83.3% of which is owned by CONSOL
Energy, reported total net income attributable to CNX Gas
shareholders of $33.0 million for the quarter ended June 30, 2009,
compared with $64.3 million in the year earlier quarter. CNX Gas
Corporation also issued its earnings release this morning.
Additional information regarding CNX Gas Corporation financial and
operating results for the quarter is available in its release and
can be found in the investor section of its website:
http://www.cnxgas.com/ Guidance CONSOL Energy continues to expect
to invest $1.0 billion in its coal and gas businesses during
calendar year 2009. The company continues to monitor and evaluate
capital spending to ensure adequate liquidity and to preserve
options for possible external investment. The company is committed
to completing capital projects in progress, including those that
increase capacity and efficiency. CNX Gas expects to invest largely
from cash flow generated from operating activities for 2009.
GUIDANCE 2009 2010 2011 ---- ---- ---- COAL-COMMITTED TONS W/O
PRICING - 13.5 21.5 COAL-TONS WITH FIRM PRICING Tons Committed and
Priced (MM tons, 7/13/09) 58.2 39.4 18.7 Avg. Realized Price/Ton
Committed & Priced $58.39 $54.07 $50.77 COAL-TONS PRICED WITH
COLLARS Tons 0.3 3.6 5.9 Average Ceiling $41.49 $47.63 $63.13
Average Floor $37.54 $42.20 $52.64 Note: Tons priced with ceilings
and floors are not included in tons with firm pricing; they are
additive. Although there is no assurance that customers with
contracts will perform under these contracts, CONSOL Energy expects
to capture the value of contracts through negotiated or legal
means. CONSOL Energy has revised its production target from 60
million tons to 58 million tons for calendar year 2009. For the
third quarter of 2009, CONSOL Energy expects production to be
approximately 13.1 million tons. CNX Gas raised its previously
announced production guidance of 87 to 89 Bcf for calendar year
2009. Outlook Summary The U.S. economy continued to contract in the
second quarter driven by a decrease in industrial production in the
manufacturing sector. This has led to a reduction in electricity
generation, thereby negatively impacting demand and consumption of
steam coal and natural gas. Milder weather this summer in most
areas of the U.S. has further exacerbated the demand situation
which has resulted in higher than normal coal stockpiles and gas
storage levels across the country. Steam Coal and Natural Gas
Outlook Many domestic coal companies have responded to the reduced
coal demand by reducing production. Industry experts predict coal
production will be reduced by at least 100 million tons in 2009.
Mr. Harvey noted, "CONSOL Energy has a long history of being a
disciplined producer. This year several other coal producers have
also curtailed production due to market conditions. We believe that
coal production cuts will continue into next year and that this
should bode well for a sustained recovery in coal contract prices.
"In addition, natural gas producers have rapidly idled drilling
rigs since the beginning of the economic downturn, with total
active natural gas drilling rigs declining by more than 50 percent.
Industry analysts expect gas rig counts to remain relatively flat
for the remainder of 2009 and 2010. Metallurgical Coal Outlook
"Capacity utilization at steel plants in the U.S. continues to
improve following substantial inventory destocking efforts in late
2008 and early 2009. Steel plant capacity utilization in the U.S.
has steadily increased since its low in December 2008. In addition,
there are reports that nearly all metallurgical spot coal is sold
out for 2009 due to preemptive buying by China since the beginning
of the year and met coal production cutbacks." Mr. Harvey added,
"Currently, the outlook is improving in the steel industry and we
are cautiously optimistic regarding a recovery in metallurgical
coal demand and pricing. We are seeing increased interest from
South American and European steel producers who are methodically
restarting previously idled blast furnaces and coking operations."
Mr. Harvey concluded, "Although there is still much uncertainty in
the economy, certain leading economic indicators have shown
improvement. We believe that as the overall economy improves, coal
production cuts will have a profound impact on contract prices.
Furthermore, our low-cost position in coal and gas should enable us
to outperform our peers during this bottoming process." CONSOL
Energy Inc., a high-Btu bituminous coal and natural gas company, is
a member of the Standard & Poor's 500 Equity Index and the
Fortune 500. It has 16 bituminous coal mining complexes in six
states and reports proven and probable coal reserves of 4.5 billion
tons. It is also a majority owner of CNX Gas Corporation, a leading
Appalachian gas producer, with proved reserves of over 1.4 trillion
cubic feet. Additional information about CONSOL Energy can be found
at its web site: http://www.consolenergy.com/. Definition: EBIT is
defined as earnings (excluding cumulative effect of accounting
change) before deducting net interest expense (interest expense
less interest income) and income taxes. EBITDA is defined as
earnings (excluding cumulative effect of accounting change) before
deducting net interest expense (interest expense less interest
income), income taxes and depreciation, depletion and amortization.
Although EBIT and EBITDA are not measures of performance calculated
in accordance with generally accepted accounting principles,
management believes that it is useful to an investor in evaluating
CONSOL Energy because it is widely used to evaluate a company's
operating performance before debt expense and its cash flow. EBIT
and EBITDA do not purport to represent cash generated by operating
activities and should not be considered in isolation or as a
substitute for measures of performance in accordance with generally
accepted accounting principles. In addition, because all companies
do not calculate EBIT or EBITDA identically, the presentation here
may not be comparable to similarly titled measures of other
companies. Reconciliation of EBITDA and EBIT to the income
statement is as follows: CONSOL Energy EBIT & EBITDA
Reconciliation (000) Omitted Quarter Quarter Six Months Six Months
Ended Ended Ended Ended 6/30/09 6/30/08 6/30/09 6/30/08 --------
-------- ---------- ---------- Net Income Attributable to CONSOL
Energy Shareholders $113,339 $101,012 $309,158 $176,094 Add:
Interest Expense 6,945 8,526 15,457 18,704 Less: Interest Income
(186) (618) (620) (1,459) Less: Interest Income on Black Lung
Excise Tax Refund (415) (767) Add: Income Taxes 54,416 61,798
134,151 97,351 -------- -------- --------- -------- Earnings Before
Interest & Taxes (EBIT) $174,099 $170,718 $457,379 $290,690
Add: Depreciation, Depletion & Amortization 107,475 95,775
213,694 188,503 -------- -------- --------- -------- Earnings
Before Interest, Taxes and DD&A (EBITDA) $281,574 $266,493
$671,073 $479,193 ======== ======== ========= ======== For purposes
of this press release, references to "CONSOL Energy," the
"company," "we," "our," or "us" or similar words (other than the
legal names of companies) shall include CONSOL Energy Inc. and its
respective subsidiaries. Forward-Looking Statements Various
statements in this document, including those that express a belief,
expectation, or intention, as well as those that are not statements
of historical fact, are forward-looking statements (as defined in
Section 21E of the Securities Exchange Act of 1934 and the Private
Securities Litigation Reform Act of 1995). The forward-looking
statements may include projections and estimates concerning the
timing and success of specific projects, our future production,
revenues, income and capital spending. When we use the words
"believe," "intend," "expect," "may," "should," "anticipate,"
"could," "would," "will," "estimate," "plan," "predict," "project,"
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. The forward-looking
statements in this document speak only as of the date of this
document; we disclaim any obligation to update these statements
unless required by securities law, and we caution you not to rely
on them unduly. 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. These risks, uncertainties and
contingencies include, but are not limited to: the deteriorating
economic conditions; an extended decline in prices we receive for
our coal and gas affecting our operating results and cash flows;
reliance on customers honoring existing contracts, extending
existing contracts or entering into new long-term contracts for
coal; reliance on major customers; our inability to collect
payments from customers if their creditworthiness declines; the
disruption of rail, barge and other systems that deliver our coal;
a loss of our competitive position because of the competitive
nature of the coal industry and the gas industry, or a loss of our
competitive position because of overcapacity in these industries
impairing our profitability; our inability to hire qualified people
to meet replacement or expansion needs; coal users switching to
other fuels in order to comply with various environmental standards
related to coal combustion; the inability to produce a sufficient
amount of coal to fulfill our customers' requirements which could
result in our customers initiating claims against us; foreign
currency fluctuations could adversely affect the competitiveness of
our coal abroad; the risks inherent in coal mining being subject to
unexpected disruptions, including geological conditions, equipment
failure, timing of completion of significant construction or repair
of equipment, fires, accidents and weather conditions which could
impact financial results; increases in the price of commodities
used in our mining operations could impact our cost of production;
obtaining governmental permits and approvals for our operations;
the effects of proposals to regulate greenhouse gas emissions; the
effects of government regulation; the effects of stringent federal
and state employee health and safety regulations; the effects of
mine closing, reclamation and certain other liabilities; the
effects of subsidence from longwall mining operations on surface
structures, water supplies, streams and surface land; uncertainties
in estimating our economically recoverable coal and gas reserves;
the outcomes of various legal proceedings, which proceedings are
more fully described in our reports filed under the Securities
Exchange Act of 1934; increased exposure to employee related
long-term liabilities; minimum funding requirements by the Pension
Protection Act of 2006 (the Pension Act) coupled with the
significant investment and plan asset losses suffered during the
current economic decline has exposed us to making additional
required cash contributions to fund the pension benefit plans which
we sponsor and the multi-employer pension benefit plans in which we
participate; lump sum payments made to retiring salaried employees
pursuant to our defined benefit pension plan; our ability to comply
with laws or regulations requiring that we obtain surety bonds for
workers' compensation and other statutory requirements;
acquisitions that we recently have made or may make in the future
including the accuracy of our assessment of the acquired businesses
and their risks, achieving any anticipated synergies, integrating
the acquisitions and unanticipated changes that could affect
assumptions we may have made; the anti-takeover effects of our
rights plan could prevent a change of control; risks in exploring
for and producing gas; new gas development projects and exploration
for gas in areas where we have little or no proven gas reserves;
the disruption of pipeline systems which deliver our gas; the
availability of field services, equipment and personnel for
drilling and producing gas; replacing our natural gas reserves
which if not replaced will cause our gas reserves and gas
production to decline; costs associated with perfecting title for
gas rights in some of our properties; location of a vast majority
of our gas producing properties in three counties in southwestern
Virginia, making us vulnerable to risks associated with having our
gas production concentrated in one area; other persons could have
ownership rights in our advanced gas extraction techniques which
could force us to cease using those techniques or pay royalties;
our ability to acquire water supplies needed for drilling, or our
ability to dispose of water used or removed from strata at a
reasonable cost and within applicable environmental rules; the
coalbeds and other strata from which we produce methane gas
frequently contain impurities that may hamper production; the
enactment of Pennsylvania severance tax on natural gas may impact
results of existing operations and impact the economic viability of
exploiting new gas drilling and production opportunities in
Pennsylvania; our hedging activities may prevent us from benefiting
from price increases and may expose us to other risks; and other
factors discussed in our Annual Report on Form 10-K for the fiscal
year ended December 31, 2008 under "Risk Factors," as updated by
any subsequent Form 10-Qs, which are on file at the Securities and
Exchange Commission. SPECIAL INCOME STATEMENT 2nd Qtr 2009 In
Millions Quarter Ended June 30, 2009 COAL Total Total Produced
Other Total Gas Other TOTAL Sales $ 774 $ 8 $ 782 $ 153 $ 61 $ 996
Gas Royalty Interest - - - 8 - 8 Freight Revenue 27 - 27 - - 27
Other Income - 13 13 1 25 39 ---- ---- ---- ---- ---- ----- Total
Revenue and Other Income 801 21 822 162 86 1,070 Cost of Goods Sold
446 30 476 72 97 645 Gas Royalty Interests' Costs - - 6 - 6 Freight
Expense 27 - 27 - - 27 Selling, General & Admin. 22 6 28 3 4 35
DD&A 74 3 77 25 6 108 Interest Expense - - - - 6 6 Taxes Other
Than Income 65 - 65 3 2 70 ---- ---- ---- ---- ---- ----- Total
Cost 634 39 673 109 115 897 ---- ---- ---- ---- ---- ----- Earnings
Before Income Taxes $ 167 $ (18) $ 149 $ 53 $ (29) 173 Income Tax
(54) ----- Earnings Before Minority Interest 119 Minority Interest
(6) ----- Net Income $ 113 ===== CONSOL ENERGY INC. AND
SUBSIDIARIES CONSOLIDATED STATEMENTS of INCOME (Unaudited) (Dollars
in thousands - except per share data) Three Months Ended Six Months
Ended June 30, June 30, 2009 2008 2009 2008 Sales - Outside
$994,141 $1,111,410 $2,144,385 $1,997,735 Sales - Gas Royalty
Interests 8,666 22,515 21,298 39,019 Sales - Purchased Gas 1,166
1,647 2,631 5,186 Freight - Outside 27,087 63,927 58,003 108,671
Other Income 39,505 11,397 62,999 86,016 --------- ---------
--------- --------- Total Revenue and Other Income 1,070,565
1,210,896 2,289,316 2,236,627 Cost of Goods Sold and Other
Operating Charges (exclusive of depreciation, depletion and
amortization shown below) 642,856 740,735 1,310,478 1,377,461 Gas
Royalty Interests' Costs 6,458 21,880 17,049 37,954 Purchased Gas
Costs 390 1,522 1,920 4,943 Freight Expense 27,087 63,927 58,003
108,671 Selling, General and Administrative Expense 35,627 30,644
66,443 61,114 Depreciation, Depletion and Amortization 107,475
95,775 213,694 188,503 Interest Expense 6,945 8,526 15,457 18,704
Taxes Other Than Income 70,472 73,299 148,311 144,905 ---------
--------- --------- --------- Total Costs 897,310 1,036,308
1,831,355 1,942,255 --------- --------- --------- ---------
Earnings Before Income Taxes 173,255 174,588 457,961 294,372 Income
Taxes 54,416 61,798 134,151 97,351 --------- --------- ---------
--------- Net Income 118,839 112,790 323,810 197,021 Less: Net
Income Attributable to Noncontrolling Interest (5,500) (11,778)
(14,652) (20,927) --------- --------- --------- --------- Net
Income Attributable to CONSOL Energy Inc. Shareholders $113,339
$101,012 $309,158 $176,094 ========= ========= ========= =========
Basic Earnings Per Share $0.63 $0.55 $1.71 $0.96 =========
========= ========= ========= Dilutive Earnings Per Share $0.62
$0.54 $1.69 $0.95 ========= ========= ========= ========= Weighted
Average Number Of Common Shares Outstanding: Basic 180,644,498
182,977,726 180,610,676 182,775,355 ========= ========= =========
========= Dilutive 183,073,413 185,637,248 182,833,111 185,330,300
========= ========= ========= ========= Dividends Paid Per Share
$0.10 $0.10 $0.20 $0.20 --------- --------- --------- ---------
CONSOL ENERGY INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(Dollars in thousands - except per share data) (Unaudited) June 30,
December 31, 2009 2008 ASSETS Current Assets: Cash and Cash
Equivalents $108,311 $138,512 Accounts and Notes Receivable: Trade
180,752 221,729 Other Receivables 20,921 79,552 Inventories 324,655
227,810 Deferred Income Taxes 63,103 60,599 Recoverable Income
Taxes - 33,862 Prepaid Expenses 228,462 221,750 ------- -------
Total Current Assets 926,204 983,814 Property, Plant and Equipment:
Property, Plant and Equipment 10,265,654 9,980,288 Less -
Accumulated Depreciation, Depletion and Amortization 4,362,575
4,214,316 --------- --------- Total Property, Plant and Equipment -
Net 5,903,079 5,765,972 Other Assets: Deferred Income Taxes 301,511
333,543 Investment in Affiliates 77,706 72,996 Other 148,800
214,133 ------- ------- Total Other Assets 528,017 620,672 -------
------- TOTAL ASSETS $7,357,300 $7,370,458 ========== ==========
CONSOL ENERGY INC. AND SUBSIDIARIES (Unaudited) CONSOLIDATED
BALANCE SHEETS (Dollars in thousands - except per share data)
(Unaudited) June 30, December 31, LIABILITIES AND STOCKHOLDERS'
EQUITY 2009 2008 Current Liabilities: Accounts Payable $232,136
$385,197 Short-Term Notes Payable 452,000 557,700 Current Portion
of Long-Term Debt 22,231 22,401 Accrued Income Taxes 4,891 - Other
Accrued Liabilities 554,190 546,442 ------- ------- Total Current
Liabilities 1,265,448 1,511,740 Long-Term Debt: Long-Term Debt
391,856 393,312 Capital Lease Obligations 69,736 75,039 ------
------ Total Long-Term Debt 461,592 468,351 Deferred Credits and
Other Liabilities: Postretirement Benefits Other Than Pensions
2,494,054 2,493,344 Pneumoconiosis Benefits 194,984 190,261 Mine
Closing 393,653 404,629 Gas Well Plugging 84,114 80,554 Workers'
Compensation 131,959 128,477 Salary Retirement 167,587 194,567
Reclamation 21,818 38,193 Other 155,300 185,996 ------- -------
Total Deferred Credits and Other Liabilities 3,643,469 3,716,021
--------- --------- Total Liabilities 5,370,509 5,696,112
Stockholders' Equity: Common Stock, $.01 par value; 500,000,000
Shares Authorized, 183,014,426 Issued and 180,665,103 Outstanding
at June 30, 2009; 183,014,426 Issued and 180,549,851 Outstanding at
December 31, 2008 1,830 1,830 Preferred Stock, 15,000,000 Shares
Authorized; None Issued and Outstanding - - Capital in Excess of
Par Value 1,013,810 993,478 Retained Earnings 1,279,979 1,010,902
Other Comprehensive Loss (467,193) (461,900) Common Stock in
Treasury, at Cost - 2,349,323 Shares at June 30, 2009 and 2,464,575
Shares at December 31, 2008 (78,150) (82,123) ------- ------- Total
Consol Energy Inc. Stockholders' Equity 1,750,276 1,462,187
Noncontrolling Interest 236,515 212,159 ------- ------- Total
Equity 1,986,791 1,674,346 ------- ------- TOTAL LIABILITIES AND
EQUITY $7,357,300 $7,370,458 --------- --------- CONSOL ENERGY INC.
AND SUBSIDIARIES (Unaudited) CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands) Three Months Six Months Ended Ended June 30,
June 30, 2009 2008 2009 2008 Operating Activities: Net Income
$118,839 $112,790 $323,810 $197,021 Adjustments to Reconcile Net
Income to Net Cash Provided by Operating Activities: Depreciation,
Depletion and Amortization 107,475 95,775 213,694 188,503
Stock-based Compensation 11,877 6,767 21,783 12,425 Gain on the
Sale of Assets (7,917) (764) (9,788) (8,050) Amortization of
Mineral Leases 727 1,153 2,398 3,240 Deferred Income Taxes 18,036
54,568 34,488 68,996 Equity in Earnings of Affiliates (3,439)
(2,290) (6,800) (3,645) Changes in Operating Assets: Accounts
Receivable Securitization - 18,500 - 29,900 Accounts and Notes
Receivable 131,013 (29,208) 100,554 (110,856) Inventories (46,979)
9,700 (96,845) (11,467) Prepaid Expenses 16,185 16,198 18,505
19,289 Changes in Other Assets 20 481 5,347 13,822 Changes in
Operating Liabilities: Accounts Payable (21,269) 34,874 (64,959)
21,058 Other Operating Liabilities 18,867 7,789 45,117 11,276
Changes in Other Liabilities (33,915) (1,098) (30,977) 37,739 Other
6,946 (1,351) 9,919 726 ------- ------- ------- ------- Net Cash
Provided by Operating Activities 316,466 323,884 566,246 469,977
------- ------- ------- ------- Investing Activities: Capital
Expenditures (196,859) (259,935)(496,419)(436,277) Net Investment
in Equity Affiliates 1,370 (2,355) 2,090 (819) Proceeds from Sales
of Assets 4,357 1,477 48,184 17,280 ------- ------- ------- -------
Net Cash Used in Investing Activities (191,132)
(260,813)(446,145)(419,816) ------- ------- ------- -------
Financing Activities: Proceeds from (Payments on) Miscellaneous
Borrowings (2,857) 1,306 (9,282) 6,307 Proceeds from (Payments on)
Short-Term Borrowings (68,400) (73,000)(105,700) (40,500) Tax
Benefit from Stock-Based Compensation 257 10,473 397 19,994
Dividends Paid (18,068) (18,294) (36,128) (36,549) Issuance of
Treasury Stock 490 8,886 611 14,156 Purchases of Treasury Stock -
(28) - (31) Noncontrolling Interest Member Distribution - - (200) -
------- ------- ------- ------- Net Cash Provided by(Used in)
Financing Activities (88,578) (70,657)(150,302) (36,623) -------
------- ------- ------- Net Increase(Decrease) in Cash and Cash
Equivalents 36,756 (7,586) (30,201) 13,538 Cash and Cash
Equivalents at Beginning of Period 71,555 62,775 138,512 41,651
------- ------- ------- ------- Cash and Cash Equivalents at End of
Period $108,311 $55,189 $108,311 $55,189 ======= ======= =======
======= CONSOL ENERGY INC. AND SUBSIDIARIES (Unaudited)
CONSOLIDATED STATEMENTS OF EQUITY (Dollars in Thousands - except
per share data) Capital in Other Excess Retained Comprehensive
Common of Par Earnings Income Stock Value (Deficit) (Loss) Balance
- December 31, 2008 $1,830 $ 993,478 $ 1,010,902 $ (461,900)
(Unaudited) Net Income - - 309,158 - Treasury Rate Lock (Net of
($24) tax) - - - (41) FASB 158 Long-Term Liability Adjustment (Net
of $116 tax) - - - 190 Gas Cash Flow Hedge (Net of $4,775 tax) - -
- (5,442) ------- ------- ------- ------- Comprehensive Income - -
309,158 (5,293) Issuance of Treasury Stock - - (3,953) - Issuance
of CNX Gas Stock - - - - Tax Benefit from Stock-Based Compensation
- (110) - - Amortization of Stock-Based Compensation Awards -
16,942 - - Stock-Based Compensation Awards to CNX Gas - 3,500 - -
Net Change in Crown Drilling Noncontrolling Interest - - - -
Dividends ($0.20 per share) - - (36,128) - ------- ------- -------
------- Balance - June 30, 2009 $1,830 $ 1,013,810 $ 1,279,979 $
(467,193) ------- ------- ------- ------- Total CONSOL Energy, Inc.
Noncont- Treasury Stock-holders' rolling Total Stock Equity
Interest Equity Balance - December 31, 2008 $ (82,123) $ 1,462,187
$ 212,159 $ 1,674,346 ------- --------- ------- --------
(Unaudited) Net Income - 309,158 14,652 323,810 Treasury Rate Lock
(Net of ($24) tax) - (41) - (41) FASB 158 Long-Term Liability
Adjustment (Net of $116 tax) - 190 11 201 Gas Cash Flow Hedge (Net
of $4,775 tax) - (5,442) (1,085) (6,527) ------- --------- -------
-------- Comprehensive Income - 303,865 13,578 317,443 Issuance of
Treasury Stock 3,973 20 - 20 Issuance of CNX Gas Stock - - 121 121
Tax Benefit from Stock-Based Compensation - (110) (1) (111)
Amortization of Stock-Based Compensation Awards - 16,942 15,190
32,132 Stock-Based Compensation Awards to CNX Gas - 3,500 (2,916)
584 Net Change in Crown Drilling Noncontrolling Interest - -
(1,616) (1,616) Dividends ($0.20 per share) - (36,128) - (36,128)
------- --------- ------- -------- Balance - June 30, 2009 $
(78,150) $ 1,750,276 $ 236,515 $ 1,986,791 ------- ---------
------- -------- Contact: Dan Zajdel at (724) 485-4169 DATASOURCE:
CONSOL Energy Inc. CONTACT: Dan Zajdel of CONSOL Energy Inc.,
+1-724-485-4169 Web Site: http://www.consolenergy.com/
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