Today in New West news: Arch Coal emerges from bankruptcy, Micron posts less than expected fourth quarter loss, and former Yellowstone superintendent dies.
Early this year, in January, Arch Coal, America’s second largest coal company, sent shockwaves through the industry by declaring bankruptcy, setting off a monumental debate over the future of coal for power generation and other purposes. The company was $6 billion in debt and liable for around $400 million in reclamation dues for its Wyoming mines.
Now, according to the Casper Star Tribune, Arch Coal has emerged from bankruptcy proceedings, shedding most of its debt in the process:
The St. Louis-based company shed $4.7 billion of what it owed when it filed for Ch. 11 protection in January. The company is the second-largest producer of thermal coal in the U.S. and has $300 million in cash, according to a company statement released Monday. It also carries $363 million in debt, mostly the result of a new term loan and capital leases, according to the company.
“I am confident we have all the pieces in place for long-term success – an extraordinary workforce, cost-competitive assets, a high-quality reserve base, a clean balance sheet and an excellent management team,” the company’s CEO John Eaves said in a statement Monday.
Arch, which operates the Black Thunder mine near Wright, is one of three large coal companies operating in Wyoming to file for Ch. 11 protection since last year and the second to re-emerge. Alpha Natural Resources exited bankruptcy in July as a new company, Contura Energy. Peabody Energy, which owns the North Antelope Rochelle mine near Gillette, has yet to finish restructuring.
The bankrupt companies accrued significant debt when the metallurgical coal market ballooned, and Chinese demand appeared insatiable. Those proved to be bad bets when the coal market plunged to 30-year lows. Arch, Alpha and Peabody laid off a combined 502 Wyoming coal miners in April as a result.
Coal is projected to rally, though not to its former glory, according to most analysts. The post-bankruptcy companies have good odds and less debt to constrain their financials, some say.
Wyoming is known for thermal coal, which is used to generate electricity. That market has not been as successful as its sister, the metallurgical market, which recently experienced growth. Arch has a dominant position in the met market which services the steel industry.
Over in Idaho, according to the Idaho Statesman, Boise-based Micron Technology has posted better-than-expected fourth quarter revenue, which is a mixed bag considering the company expected to lose millions—and still lost millions. Micron posted a loss of $170 million, adding to a total loss of $276 million for the past four quarters. The company made $12.4 billion this year, down from $16.1 billion in 2015.
According to Fortune, despite the loss, the company is optimistic heading into the latest quarter:
Micron, which manufactures DRAM chips used in PCs and NAND flash memory chips widely used in smartphones to store music, pictures and data, has enjoyed a recovery in the last six months amid signs of improvement in the market.
“We are seeing improving market conditions in terms of both slowing supply growth and improving demand across a number of key segments,” Micron CEO Mark Durcan said.
With DRAM prices rebounding to 7 month highs, Micron is benefiting as the supply glut in the market has dried up following aggressive cut backs in production amid signs of a bounce back in demand.
Prices of both DRAM and NAND chips are expected to rise in the fourth quarter, according to research firm TrendForce, with DRAM prices anticipated to rise over 10% from the previous quarter.
On an adjusted basis, Micron lost 5 cents per share, beating estimates of a loss of 12 cents per share.
The latest quarter included a $58 million charge related to a restructuring program the company announced in the third quarter.
Micron’s net sales fell 10.6% to $3.22 billion in the fourth quarter. Analysts on average were expecting revenue of $3.15 billion.
Finally, down in Yellowstone National Park, former Yellowstone superintendent Bob Barbee passed away Sunday, October 2 at the age of 80 in his home in Bozeman, Montana, according to Yellowstone Insider:
Bob’s cumulative achievements within the agency and in particular in Yellowstone are too numerous to recount. However, he will always be remembered for his handling of the epic 1988 Yellowstone fires and how he persevered through the intensity of that long summer. He faced hordes of people, thousands of news media, and an endless stream of politicians all wanting to dictate how he should be managing the fires.
With the hindsight of some 28 years now, it is clear Bob’s leadership in managing the extreme fire situation in 1988 ultimately shaped the future of federal wildland fire management policy. Today many of the methods used in Yellowstone in 1988 are now mainstream tactics in managing large wildland fires for resource benefit, economics, and most importantly for human safety.
Anyone fortunate enough to know Bob also knows his extraordinary partner and spouse Carol. Together they shared their lives in some of our nation’s most iconic landscapes, raised three daughters and are the proud grandparents of seven grandkids. They have entertained presidents and kings as well as seasonal park employees who had no place to sleep for a night or two between jobs. Their hospitality is legend and many a national decision was made around their kitchen table or campfire with some of the nation’s highest officials.