Shares of Arch Coal (ACI) are up 44 cents, or 1.7%, at $26.44, after the company this morning reported Q1 EPS of 3 cents per share, 5 cents shy of expectations, as revenue rose 4.5% to $711.9 million, below the $725 million analysts were projecting, but also�raised its year profit forecast on expectations of a strengthening coal market.
The company raised its forecast for the year to 147 million to 155 million tons of expected coal sales, which is up slightly at the bottom end of the range from 145 million tons, as expressed back in mid-January.
The company forecast 2010 EPS of $1 to $1.40, excluding some non-cash costs, way up from the $50 cents o to $1 it forecast back in January. That’s ahead of the 90 cents per share that analysts have been forecasting.
Q1 EPS excluded a one-time, non-cash charge relating to amortization of coal-supply agreements. Including that charge, the company lost a penny per share.
The company is prepared to “capitalize on positive growth trends in global and domestic coal” given “our low-cost operational profile,” said CEO Steven Leer. 2010 will be a “transformational year” for the coal business as excessive stockpiles are worked down, he said.
In a nod tothe recent mine disaster suffered by Massey Energy (MEE) in West Virginia, Arch said its safety performance in Q1 was on par with a record performance a year earlier, with 0.34 incidents per 200,000 hours worked, and down from the 2009 average 0.71 incidents every 200,000 hours.
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