Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 27, 2017 | |
Document Documentand Entity Information [Abstract] | ||
Entity Registrant Name | WESTMORELAND COAL Co | |
Entity Central Index Key | 106,455 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 18,744,151 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 44,143 | $ 60,082 |
Receivables: | ||
Trade | 146,412 | 140,731 |
Loan and lease receivables | 0 | 5,867 |
Other | 12,522 | 13,261 |
Total receivables | 158,934 | 159,859 |
Inventories | 110,176 | 125,515 |
Other current assets | 29,788 | 32,258 |
Total current assets | 343,041 | 377,714 |
Property, plant and equipment: | ||
Gross property, plant and equipment | 1,670,632 | 1,617,938 |
Less accumulated depreciation, depletion and amortization | 904,246 | 782,417 |
Net property, plant and equipment | 766,386 | 835,521 |
Loan and lease receivables, less current portion | 0 | 44,474 |
Advanced coal royalties | 18,665 | 18,722 |
Restricted investments and bond collateral | 224,349 | 219,275 |
Investment in joint venture | 28,244 | 26,951 |
Other assets | 53,827 | 62,252 |
Total Assets | 1,434,512 | 1,584,909 |
Current liabilities: | ||
Current installments of long-term debt | 49,712 | 86,272 |
Accounts payable and accrued expenses: | ||
Trade and other accrued liabilities | 113,970 | 142,233 |
Interest payable | 15,205 | 22,458 |
Production taxes | 48,936 | 44,995 |
Postretirement medical benefits | 14,892 | 14,892 |
Deferred revenue | 16,248 | 15,253 |
Asset retirement obligations | 44,841 | 32,207 |
Other current liabilities | 26,354 | 20,964 |
Total current liabilities | 330,158 | 379,274 |
Long-term debt, less current installments | 1,021,436 | 1,022,794 |
Postretirement medical benefits, less current portion | 310,183 | 308,709 |
Pension and SERP obligations, less current portion | 42,624 | 43,982 |
Deferred revenue, less current portion | 7,791 | 16,251 |
Asset retirement obligations, less current portion | 451,862 | 451,834 |
Other liabilities | 44,605 | 52,182 |
Total liabilities | 2,208,659 | 2,275,026 |
Shareholders' deficit: | ||
Common stock of $.01 par value: Authorized 30,000,000 shares; Issued and outstanding 18,742,143 at September 30, 2017 and 18,570,642 at December 31, 2016 | 187 | 186 |
Other paid-in capital | 250,729 | 248,143 |
Accumulated other comprehensive loss | (157,799) | (179,072) |
Accumulated deficit | (864,012) | (757,367) |
Total Westmoreland Coal Company shareholders’ deficit | (770,895) | (688,110) |
Noncontrolling interests in consolidated subsidiaries | (3,252) | (2,007) |
Total deficit | (774,147) | (690,117) |
Total Liabilities and Shareholders' Deficit | $ 1,434,512 | $ 1,584,909 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 18,742,143 | 18,570,642 |
Common stock, shares outstanding | 18,742,143 | 18,570,642 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Revenues | $ 358,011 | $ 371,772 | $ 1,020,772 | $ 1,085,223 |
Costs, expenses and other: | ||||
Cost of sales | 280,012 | 285,428 | 836,525 | 864,735 |
Depreciation, depletion and amortization | 38,066 | 40,860 | 114,131 | 113,097 |
Selling and administrative | 28,115 | 25,655 | 88,706 | 80,667 |
Heritage health benefit expenses | 3,349 | 3,265 | 9,953 | 9,502 |
Loss (gain) on sale/disposal of assets | 236 | 548 | 202 | (1,369) |
Derivative (gain) loss | (4,667) | 5,442 | (6,571) | 2,164 |
Income from equity affiliates | (1,355) | (1,547) | (4,274) | (4,127) |
Other operating loss | 0 | 3,368 | 0 | 5,065 |
Total costs, expenses and other | 343,756 | 363,019 | 1,038,672 | 1,069,734 |
Operating income (loss) | 14,255 | 8,753 | (17,900) | 15,489 |
Other (expense) income: | ||||
Interest expense | (30,017) | (30,882) | (89,388) | (90,669) |
Interest income | 1,012 | 1,374 | 2,942 | 5,521 |
(Loss) gain on foreign exchange | (1,739) | 220 | (3,391) | (1,531) |
Other (loss) income | (3,251) | 303 | (793) | 435 |
Total other income (expense) | (33,995) | (28,985) | (90,630) | (86,244) |
Loss before income taxes | (19,740) | (20,232) | (108,530) | (70,755) |
Income tax benefit | (440) | (1,625) | (1,406) | (49,660) |
Net loss | (19,300) | (18,607) | (107,124) | (21,095) |
Less net loss attributable to noncontrolling interest | (78) | (239) | (715) | (1,545) |
Net loss applicable to common shareholders | $ (19,222) | $ (18,368) | $ (106,409) | $ (19,550) |
Net loss per share applicable to common shareholders: | ||||
Basic and diluted (in dollars per share) | $ (1.03) | $ (0.99) | $ (5.70) | $ (1.06) |
Weighted average number of common shares outstanding: | ||||
Basic and diluted (shares) | 18,742 | 18,570 | 18,672 | 18,458 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive (Loss) Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (19,300) | $ (18,607) | $ (107,124) | $ (21,095) |
Other comprehensive income (loss) | ||||
Amortization of accumulated actuarial losses, pension | 588 | 1,294 | 1,765 | 3,639 |
Adjustments to accumulated actuarial gains (losses) and transition obligations, pension | (112) | 813 | 189 | 786 |
Amortization of accumulated actuarial losses, transition obligations, and prior service costs, postretirement medical benefit | 964 | 368 | 2,893 | 891 |
Adjustments to accumulated actuarial gains and transition obligations, postretirement medical benefit | 0 | 0 | 0 | 984 |
Tax effect of other comprehensive income losses | (684) | (1,039) | (2,503) | (2,410) |
Change in foreign currency translation adjustment | 9,426 | (2,432) | 17,455 | 16,128 |
Unrealized and realized gains and losses on available-for-sale securities | 278 | 535 | 1,474 | 255 |
Other comprehensive income (loss), net of income taxes | 10,460 | (461) | 21,273 | 20,273 |
Comprehensive loss | (8,840) | (19,068) | (85,851) | (822) |
Less: Comprehensive loss attributable to noncontrolling interest | (78) | (240) | (715) | (1,532) |
Comprehensive (loss) income attributable to common shareholders | $ (8,762) | $ (18,828) | $ (85,136) | $ 710 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (107,124) | $ (21,095) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation, depletion and amortization | 114,131 | 113,097 |
Accretion of asset retirement obligation and receivable | 33,796 | 30,229 |
Share-based compensation | 3,846 | 5,925 |
Non-cash interest expense | 6,981 | 6,879 |
Amortization of deferred financing costs | 8,183 | 8,324 |
(Gain) loss on derivative instruments | (6,571) | 2,164 |
Loss on foreign exchange | 3,391 | 1,531 |
Income from equity affiliates | (4,274) | (4,127) |
Distributions from equity affiliates | 4,970 | 5,177 |
Deferred income tax benefit | (1,374) | (48,490) |
Other | 3,341 | (9,217) |
Changes in operating assets and liabilities: | ||
Receivables | (1,223) | 9,770 |
Inventories | 19,713 | 8,238 |
Accounts payable and accrued expenses | (26,965) | 1,679 |
Interest payable | (7,165) | (6,731) |
Deferred revenue | (7,475) | 4,314 |
Other assets and liabilities | 17,977 | 23,396 |
Asset retirement obligation | (33,004) | (45,960) |
Net cash provided by operating activities | 21,154 | 85,103 |
Cash flows from investing activities: | ||
Additions to property, plant and equipment | (25,365) | (30,619) |
Proceeds from sales of restricted investments | 33,686 | 31,903 |
Purchases of and change in restricted investments | (37,945) | (31,633) |
Cash payments related to acquisitions | (3,580) | (125,315) |
Proceeds from sales of assets | 774 | 6,176 |
Receipts from loan and lease receivables | 50,488 | 4,852 |
Payments related to loan and lease receivables | 0 | (2,141) |
Other | (1,384) | (587) |
Net cash provided by (used in) investing activities | 16,674 | (147,364) |
Cash flows from financing activities: | ||
Borrowings from long-term debt, net of debt discount | 0 | 122,250 |
Repayments of long-term debt | (64,078) | (43,876) |
Borrowings on revolving lines of credit | 236,100 | 313,900 |
Repayments of revolving lines of credit | (225,560) | (315,900) |
Debt issuance costs and other refinancing costs | 0 | (7,246) |
Other | (550) | (798) |
Net cash (used in) provided by financing activities | (54,088) | 68,330 |
Effect of exchange rate changes on cash | 321 | (91) |
Net (decrease) increase in cash and cash equivalents | (15,939) | 5,978 |
Cash and cash equivalents, beginning of period | 60,082 | 22,936 |
Cash and cash equivalents, end of period | 44,143 | 28,914 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 81,478 | 79,099 |
Non-cash transactions: | ||
Accrued purchases of property and equipment | 3,508 | 4,166 |
Capital leases and other financing sources | $ 503 | $ 19,830 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION | 1. BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements include accounts of Westmoreland Coal Company (the “Company” or "WCC"), and its subsidiaries and controlled entities including those of Westmoreland Resource Partners, LP (“WMLP”). All intercompany transactions and accounts have been eliminated in consolidation. The consolidated financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (“GAAP”) and require the use of management’s estimates. The financial information contained in this Quarterly Report on Form 10-Q (“Quarterly Report”) is unaudited, but reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the financial information for the periods shown. Such adjustments are of a normal recurring nature. Certain prior period amounts have been reclassified to conform to current period presentation. The results of operations for the nine months ended September 30, 2017 are not necessarily indicative of results to be expected for the year ending December 31, 2017 . These unaudited quarterly consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 (“ 2016 Form 10-K”). There were no changes to our significant accounting policies from those disclosed in the audited consolidated financial statements and notes to the consolidated financial statements thereto contained in our 2016 Form 10-K, except as described below. Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) which requires companies leasing assets to recognize on their balance sheet a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term on contracts longer than one year. The lessee is permitted to make an accounting policy election to not recognize lease assets and lease liabilities for short-term leases. How leases are recorded on the balance sheet represents a significant change from previous GAAP guidance as described in Accounting Standards Codification (“ASC”) Topic 840, Leases. ASU 2016-02 maintains a distinction between finance leases and operating leases similar to the distinction under previous lease guidance for capital leases and operating leases. The impact of leases reported in the Company’s operating results and statement of cash flows are expected to be similar to previous GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. Adoption of the new lease accounting standard will require the Company to apply the new standard to the earliest period using a modified retrospective approach. The Company is currently in the process of evaluating the impact of the new standard, including the evaluation of the impact, if any, on changes to business processes, systems and controls to support recognition and disclosure under the new guidance, however, at this time is unable to determine the impact this standard will have on the financial statements and related disclosures. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This standard is effective for interim and annual periods beginning after December 15, 2017. We anticipate adopting this ASU on January 1, 2018 will have an immaterial impact to the financial statements including reclassification of accumulated other comprehensive income for available-for-sale securities into equity at January 1, 2018, and future changes to the fair value of available-for-sale securities will be recognized in the income statement. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers which was issued as a new Topic, ASC Topic 606. The new revenue recognition standard supersedes all existing revenue recognition guidance. Under this ASU, an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2015-14, issued in August 2015, deferred the effective date of ASU 2014-09 to the first quarter of 2018, with early adoption permitted in the first quarter of 2017. The Company intends to adopt the amended guidance as of January 1, 2018. In March, April, May, and December 2016, the FASB issued the following updates, respectively, to provide supplemental adoption guidance and clarification to ASU 2014-09. These standards must be adopted concurrently upon the adoption of ASU 2014-09. We are currently evaluating the potential effects of adopting the provisions of these updates. • ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net). • ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing. • ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients. • ASU 2016-19, Technical Corrections and Improvements. We have established an implementation team to execute a multi-phase plan to adopt the requirements of the new standard. The team is in the process of finalizing its conclusions on how the guidance will be applied to all coal sales contracts comprising greater than half of our consolidated revenues. The team is also evaluating the expanded disclosures required by the new standard and reviewing our processes and internal controls over financial reporting to ensure the appropriate information will be available for these disclosures. No changes will be required to our system capabilities to obtain the appropriate information. Under the new standard, companies may use either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients; or (ii) a modified retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We will be adopting the standard under the full retrospective approach. Based on our implementation team’s analyses, we believe the implementation of the new standard will have a material impact on our consolidated financial statements for sales contracts in which we are entitled to payments from customers to reimburse our costs incurred during final reclamation. Under current GAAP, as these amounts are not fixed and determinable until they are incurred, we have been precluded from recognizing revenue until the costs have been incurred during final reclamation. However, under ASC Topic 606, these payments from customers constitute variable consideration and therefore must be estimated at contract inception and recognized as revenue as we satisfy our performance obligations of delivering coal to the customer. This will ultimately result in a significant acceleration of revenue, most of which will be recognized as a transition adjustment as of January 1, 2016. The implementation team is currently reviewing the models to quantify the exact amount of the transition adjustment and related impact to revenues for the years ended December 31, 2017 and 2016. |
ACQUISITION
ACQUISITION | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
ACQUISITION | 2. ACQUISITION Acquisition of San Juan On January 31, 2016, Westmoreland San Juan, LLC (“WSJ”), a variable interest entity of the Company, acquired San Juan Coal Company (“SJCC”), which operates the San Juan mine in Farmington, New Mexico, and San Juan Transportation Company (“SJTC” and such transaction, the “San Juan Acquisition”) for a total cash purchase price of $121.0 million . The San Juan mine is the exclusive supplier of coal to the adjacent San Juan Generating Station (“SJGS”) under a coal supply agreement through 2022. The San Juan operations are included in the Company’s Coal - U.S. segment. WSJ financed the San Juan Acquisition principally with a $125.0 million loan from NM Capital Utility Corporation (the “San Juan Loan”), an affiliate of Public Service Company of New Mexico (one of the owners of SJGS). The San Juan Acquisition has been accounted for under the acquisition method of accounting that requires the total purchase consideration to be allocated to the assets acquired and liabilities assumed based on estimates of fair value. Purchase price accounting was considered final as of December 31, 2016 . The allocation of the purchase consideration follows (in millions): Purchase price: Cash paid $ 121.0 Allocation of purchase price: Assets: Inventories $ 8.8 Total current assets 8.8 Land and mineral rights 143.9 Plant and equipment 74.6 Other assets 1.3 Total assets 228.6 Liabilities: Trade payables and other accrued liabilities 13.4 Production taxes 2.0 Asset retirement obligations 0.7 Total current liabilities 16.1 Asset retirement obligations, less current portion 43.5 Postretirement medical benefits 1.9 Deferred income taxes 46.1 Total liabilities 107.6 Net fair value $ 121.0 Unaudited Pro Forma Information The following unaudited pro forma information has been prepared for illustrative purposes only and assumes the San Juan Acquisition occurred on January 1, 2016. The unaudited pro forma results have been prepared based on estimates and assumptions, which the Company believes are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisitions occurred on the dates indicated above, or of future results of operations. Nine Months Ended September 30, 2016 (In thousands, except per share data) Revenues As reported $ 1,085,223 Pro forma (unaudited) 1,111,498 Operating income As reported $ 15,489 Pro forma (unaudited) 16,584 Net loss applicable to common shareholders As reported $ (19,550 ) Pro forma (unaudited) (19,125 ) Net loss per share applicable to common shareholders (basic and diluted) As reported $ (1.06 ) Pro forma (unaudited) (1.04 ) |
VARIABLE INTEREST ENTITY
VARIABLE INTEREST ENTITY | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITY | 3. VARIABLE INTEREST ENTITY The Company consolidates its 100% owned WSJ subsidiary which qualifies as a variable interest entity (“VIE”) under GAAP. WSJ’s classification as a VIE is due to a third party lender having the potential right to receive WSJ’s residual returns. The Company is the primary beneficiary because it has the power to direct the activities that most significantly impact WSJ’s economic performance. Accordingly, the Company consolidated the operating results, assets and liabilities of WSJ. See Note 2 - Acquisition to the consolidated financial statements (unaudited) for details surrounding the VIE’s acquisition and Note 6 - Debt And Lines Of Credit to the consolidated financial statements (unaudited) for the VIE’s debt structure. The following table presents the carrying amounts, after eliminating the effect of intercompany transactions, included in the Consolidated Balance Sheets that are for the use of or are the obligation of WSJ: September 30, 2017 December 31, 2016 (In thousands) Assets $ 215,230 $ 268,910 Liabilities 180,559 243,884 Net carrying amount $ 34,671 $ 25,026 |
INVENTORIES
INVENTORIES | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | 4. INVENTORIES Inventories consisted of the following: September 30, 2017 December 31, 2016 (In thousands) Coal stockpiles $ 36,013 $ 44,692 Coal fuel inventories 1,338 6,816 Materials and supplies 76,669 77,628 Reserve for obsolete inventory (3,844 ) (3,621 ) Total $ 110,176 $ 125,515 |
RESTRICTED INVESTMENTS AND BOND
RESTRICTED INVESTMENTS AND BOND COLLATERAL | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Restricted Investments and Bond Collateral [Abstract] | |
RESTRICTED INVESTMENTS AND BOND COLLATERAL | 5. RESTRICTED INVESTMENTS AND BOND COLLATERAL The Company invests certain bond collateral, reclamation deposits, and other restricted investments in a limited selection of fixed-income investment options and receives the corresponding investment returns. These investments are not available to meet the Company’s general cash needs. These accounts include available-for-sale securities. Available-for-sale securities are reported at fair value with unrealized gains and losses excluded from earnings and reported in Accumulated other comprehensive loss . The Company’s carrying value and estimated fair value of its restricted investments at September 30, 2017 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cash and cash equivalents $ 65,441 $ 3,443 $ 68,884 Time deposits 2,467 — 2,467 Available-for-sale 79,505 73,493 152,998 $ 147,413 $ 76,936 $ 224,349 The Company’s carrying value and estimated fair value of its restricted investments at December 31, 2016 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cash and cash equivalents $ 66,860 $ 2,673 $ 69,533 Time deposits 2,473 — 2,473 Available-for-sale 75,580 71,689 147,269 $ 144,913 $ 74,362 $ 219,275 Available-for-Sale Restricted Investments The cost basis, gross unrealized holding gains and losses, and fair value of available-for-sale securities at September 30, 2017 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cost basis $ 79,724 $ 73,470 $ 153,194 Gross unrealized holding gains 520 624 1,144 Gross unrealized holding losses (739 ) (601 ) (1,340 ) Fair value $ 79,505 $ 73,493 $ 152,998 The cost basis, gross unrealized holding gains and losses, and fair value of available-for-sale securities at December 31, 2016 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cost basis $ 76,558 $ 72,381 $ 148,939 Gross unrealized holding gains 251 453 704 Gross unrealized holding losses (1,229 ) (1,145 ) (2,374 ) Fair value $ 75,580 $ 71,689 $ 147,269 |
DEBT AND LINES OF CREDIT
DEBT AND LINES OF CREDIT | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
DEBT AND LINES OF CREDIT | 6. DEBT AND LINES OF CREDIT The Company and its subsidiaries are subject to the following debt arrangements: Total Debt Outstanding September 30, 2017 December 31, 2016 (In thousands) 8.75% Notes $ 350,000 $ 350,000 Term Loan 321,417 323,883 San Juan Loan 66,230 95,000 WMLP Term Loan 311,628 306,189 Revolver 10,540 — WMLP Revolver — — Capital lease obligations 36,736 55,061 Other debt 4,512 16,464 Total debt 1,101,063 1,146,597 Less debt discount and issuance costs, net (29,915 ) (37,531 ) Less current installments (49,712 ) (86,272 ) Long-term debt, less current installments $ 1,021,436 $ 1,022,794 The following table presents remaining aggregate contractual debt maturities of all long-term debt as of September 30, 2017 (in thousands): Debt Held by WMLP All Other Debt Total Debt Outstanding 2017 $ 1,660 $ 30,572 $ 32,232 2018 315,804 18,852 334,656 2019 4,105 15,439 19,544 2020 1,694 338,571 340,265 2021 1,586 21,164 22,750 Thereafter 1,616 350,000 351,616 Total debt $ 326,465 $ 774,598 $ 1,101,063 Covenant Compliance Our lending arrangements contain, among other terms, events of default and various affirmative and negative covenants, financial covenants and cross-default provisions. Certain affirmative covenants in our WMLP Term Loan provide that an explanatory paragraph expressing substantial doubt about WMLP's ability to continue as a going concern constitutes an event of default. We are in compliance with our covenants for the quarter ending September 30, 2017 . Our continuing ability to meet our obligations and comply with our covenants depends on our ability to generate adequate cash flows and refinance debt obligations as they become due. Should we be unable to comply with any future debt-related covenant, we will be required to seek a waiver of such covenant to avoid an event of default. Covenant waivers and modifications may be expensive to obtain or potentially unavailable. As of September 30, 2017 , we are in compliance with the fixed charge ratio under our revolver agreements. Based on current projections, absent management plans, there is substantial doubt as to our ability to comply with this covenant during the next twelve months from this filing. If we were to breach this covenant and were unable to obtain a waiver from the lenders, we could lose access to the Revolver . An uncured breach of the covenants in our Revolver would trigger certain customary cross-default provisions in our $350.0 million 8.75% Notes and our $321.4 million Term Loan which would become immediately due. Our belief, based on historical patterns, is that it is probable we would be able to alleviate or cure any such Revolver covenant default with an amendment or waiver. 8.75% Notes Pursuant to our senior note indenture, dated as of December 16, 2014, by and among the Company, the guarantors named therein, and U.S. Bank National Association, as trustee and notes collateral agent (the “Indenture”), our senior secured 8.75% Notes mature on January 1, 2022 and pay interest semiannually on January 1 and July 1 of each year at a fixed 8.75% interest rate (“ 8.75% Notes ”). The 8.75% Notes are a primary obligation of the Company and are guaranteed by Westmoreland Energy LLC, Westmoreland Mining LLC and Westmoreland Resources, Inc. and their respective subsidiaries (other than Absaloka Coal, LLC, Westmoreland Risk Management, Inc. and certain other immaterial subsidiaries), referred to as the “Guarantors.” The 8.75% Notes are not guaranteed by Westmoreland Canada LLC or any of its subsidiaries, WSJ or any of its subsidiaries, or Westmoreland Resources GP, LLC or WMLP, referred to as the “Non-guarantors.” Term Loan Pursuant to our credit agreement, dated as of December 22, 2014, by and among the Company, the lenders from time to time party thereto, and Bank of Montreal, as administrative agent, as amended, our term loan (“ Term Loan ”) matures on December 16, 2020 and accrues interest on a quarterly basis at a variable interest rate which is set at our election at (i) the one-, two-, three- or six-month London Interbank Offered Rate (“LIBOR”) plus 6.50% or (ii) a base rate (determined with reference to the highest of the prime rate, the Federal Funds Rate plus 0.05%, or three-month LIBOR plus 1.00%) plus 5.50%. As of September 30, 2017 , the interest rate was 7.80% . The Term Loan is a primary obligation of WCC and is guaranteed by the Guarantors. San Juan Loan Pursuant to the loan agreement, dated as of February 1, 2016, by and among WSJ and the remaining Westmoreland San Juan Entities as guarantors, and NM Capital Utility Corporation (an affiliate of Public Service Company of New Mexico, part owner of SJGS) as lender, we financed the San Juan Acquisition in part with a senior secured $125.0 million term loan (“ San Juan Loan ”). The San Juan Loan matures on February 1, 2021 and pays interest and principal on a quarterly basis at an interest rate of (i) 7.25% (the “Margin Rate”) plus (ii) (A) the LIBOR for a three month period plus (B) a statutory reserve rate, which such Margin Rate increasing incrementally during each year of the San Juan Loan term. As of September 30, 2017 , the cash interest rate is 10.57% . It is a primary obligation of WSJ, is guaranteed by SJCC, and is secured by substantially all of SJCC’s assets. The San Juan Loan has no prepayment penalties. The agreements governing the San Juan Loan include representations and warranties and covenants regarding the ownership and operation of SJCC and the properties acquired in the San Juan Acquisition and standard special purpose bankruptcy remote entity covenants designed to preserve the separateness from the Company of each of (i) WSJ, (ii) WSJ’s direct parent company, Westmoreland San Juan Holdings, Inc., (iii) SJCC and (iv) SJTC (collectively, the “Westmoreland San Juan Entities”). Obligations under the San Juan Loan are recourse only to the Westmoreland San Juan Entities and their assets. Neither the Company nor its subsidiaries (other than the Westmoreland San Juan Entities) is an obligor under the San Juan Loan in any respect. The agreement governing the San Juan Loan requires that all revenues of the Westmoreland San Juan Entities, aside from payments on certain leases, are deposited into a cash management collection account swept monthly for operating expenses, capital expenditures, and loan payment and prepayment. The assets and credit of SJCC are not available to satisfy the debts and other obligations of the Company other than those of the Westmoreland San Juan Entities. WMLP Term Loan Pursuant to the financing agreement, dated as of December 31, 2014, by and among Oxford Mining Company, LLC, WMLP and each of its subsidiaries, lenders from time to time party thereto, and U.S. Bank National Association, as administrative agent, the term loan of WMLP (“ WMLP Term Loan ”) matures on December 31, 2018 and pays interest on a quarterly basis at a variable rate equal to the 3-month LIBOR rate at each period end ( 1.30% at September 30, 2017 ), subject to a floor of 0.75% , plus 8.50% or the reference rate, as defined in the financing agreement. As of September 30, 2017 , the cash interest rate was 9.80% . The WMLP Term Loan is a primary obligation of Oxford Mining Company, LLC, a wholly owned subsidiary of WMLP, is guaranteed by WMLP and its subsidiaries, and is secured by substantially all of WMLP’s and its subsidiaries’ assets. The WMLP Term Loan also provides for Paid-In-Kind Interest (“PIK Interest”) at a variable rate between 1.00% and 3.00% based on its consolidated total net leverage ratio as defined in the financing agreement. The rate of PIK Interest is determined on a quarterly basis with the PIK Interest added quarterly to the then-outstanding principal amount of the WMLP Term Loan under the financing agreement. PIK Interest under the financing agreement was $2.3 million and $7.0 million for the three and nine months ended September 30, 2017 , respectively. The outstanding WMLP Term Loan amount represents the principal balance of $288.6 million , plus PIK Interest of $23.1 million . The WMLP Term Loan limits cash distributions to an aggregate amount not to exceed $15.0 million (“Restricted Distributions”), if WMLP has: (i) a consolidated total net leverage ratio of greater than 3.75 , or fixed charge coverage ratio of less than 1.00 (as such ratios are defined in the WMLP Term Loan financing agreement), or (ii) liquidity of less than $7.5 million , after giving effect to such cash distribution and applying WMLP's availability under the WMLP Revolver . As of September 30, 2017 , WMLP’s consolidated total net leverage ratio is in excess of 3.75 . As of September 30, 2017 , WMLP has distributed $14.8 million in cash that counts toward the $15.0 million in aggregate Restricted Distribution payments. On October 27, 2017, WMLP announced a quarterly cash distribution for the quarter ended September 30, 2017 , of $0.1155 per limited partner common unit, general partner unit and warrant with distribution rights and a distribution of Series A PIK Units in lieu of a cash distribution for holders of Series A Convertible Units (“Third Quarter Distribution”), which is a per-unit reduction of $0.0178 from the prior quarter distribution of $0.1333 per limited partner common unit, general partner unit, warrant with distribution rights, as well as Series A PIK Unit distribution. The Third Quarter Distribution, totaling cash of approximately $0.2 million , will be paid on November 14, 2017 to all holders of record as of November 7, 2017. Subsequent to payment of this Third Quarter Distribution, WMLP will have utilized the full $15.0 million limit on Restricted Distributions, and WMLP will be restricted from making any further distributions under the terms of the WMLP Term Loan financing agreement. Revolver Pursuant to the second amended and restated loan and security agreement, dated as of December 16, 2014, by and among the Company and certain of its subsidiaries, lenders party thereto, and Canadian Imperial Bank of Commerce (formerly known as The PrivateBank and Trust Company), as administrative agent (the “ Revolver ”), the Company’s Revolver has a total aggregate borrowing capacity of $60.0 million between June 15th and August 31st of each year, with an aggregate borrowing capacity of $50.0 million outside of these periods subject to borrowing base calculations as defined in the agreement. The availability of the Revolver consists of a $30.0 million sub-facility ( $35.0 million with the seasonal increase) available to our U.S. borrowers and a $20.0 million sub-facility ( $25.0 million with the seasonal increase) available to our Canadian borrowers. The Revolver may support an equal amount of letters of credit, with outstanding letter of credit balances reducing availability under the Revolver . At September 30, 2017 , availability on the Revolver was $16.7 million which reflects $9.9 million in outstanding letters of credit and $12.8 million in borrowing base restrictions. We had $10.5 million borrowings on the Revolver . The Revolver has a maturity date of December 31, 2018 . On May 9, 2017, the Company executed a tenth amendment to our Revolver (“Tenth Amendment”). The Tenth Amendment adjusted the fixed charge coverage ratio calculation by further modifying the treatment of the accelerated repayment of the loan and lease receivable arrangement at our Genesee mine from March 24, 2017, and removing certain testing periods from the U.S. and Canadian fixed charge coverage ratio calculation so long as the Company meets certain liquidity requirements. WMLP Revolver Pursuant to the loan and security agreement, dated as of October 23, 2015, by and among WMLP and its subsidiaries, lenders party thereto, and Canadian Imperial Bank of Commerce (formerly known as The PrivateBank and Trust Company), as administrative agent (the “ WMLP Revolver ”), the WMLP Revolver permits WMLP to borrow up to the aggregate principal amount of $15.0 million subject to borrowing base restrictions as defined in the agreement. The WMLP Revolver also allows letters of credit in an aggregate outstanding amount of up to $10.0 million , which reduces availability under the WMLP Revolver on a dollar-for-dollar basis. At September 30, 2017 , availability under the WMLP Revolver was $14.8 million . The WMLP Revolver has a maturity date of December 31, 2017. Capital lease obligations The Company engages in leasing transactions for equipment utilized in its mining operations. During the nine months ended September 30, 2017 , the Company entered into $0.7 million of new capital leases. |
POSTRETIREMENT MEDICAL BENEFITS
POSTRETIREMENT MEDICAL BENEFITS AND PENSION | 9 Months Ended |
Sep. 30, 2017 | |
Retirement Benefits [Abstract] | |
POSTRETIREMENT MEDICAL BENEFITS AND PENSION | 7. POSTRETIREMENT MEDICAL BENEFITS AND PENSION Postretirement Medical Benefits The Company provides postretirement medical benefits to retired employees and their dependents as mandated by the Coal Industry Retiree Health Benefit Act of 1992 and pursuant to collective bargaining agreements. The Company also provides these benefits to qualified full-time employees pursuant to collective bargaining agreements. The components of net periodic postretirement medical benefit cost are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Components of net periodic benefit cost: Service cost $ 793 $ 763 $ 2,380 $ 2,507 Interest cost 3,197 3,075 9,590 9,278 Amortization of deferred items 964 368 2,893 891 Total net periodic benefit cost $ 4,954 $ 4,206 $ 14,863 $ 12,676 The following table shows the net periodic postretirement medical benefit costs that relate to current and former mining operations: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Former mining operations $ 2,305 $ 2,135 $ 6,916 $ 6,405 Current operations 2,649 2,071 7,947 6,271 Total net periodic benefit cost $ 4,954 $ 4,206 $ 14,863 $ 12,676 The costs for the former mining operations are included in Heritage health benefit expenses and costs for current operations are included in Cost of sales and Selling and administrative expenses. Pension The Company provides pension benefits to qualified full-time employees pursuant to collective bargaining agreements. The Company incurred net periodic benefit costs of providing these pension benefits as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Components of net periodic benefit cost: Service cost $ 348 $ 373 $ 1,133 $ 1,242 Interest cost 2,596 2,564 7,855 7,926 Expected return on plan assets (3,643 ) (3,349 ) (10,918 ) (10,390 ) Settlements — 247 269 247 Amortization of deferred items 588 1,294 1,765 3,639 Total net periodic pension cost $ (111 ) $ 1,129 $ 104 $ 2,664 These costs are included in Cost of sales and Selling and administrative expenses. The Company made $1.1 million and $0.6 million of contributions to its pension plans in the nine months ended September 30, 2017 and 2016 , respectively. The Company expects to make $0.1 million of contributions to its pension plans during the remainder of 2017 . |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | 8. DERIVATIVE INSTRUMENTS Derivative Assets and Liabilities The Company evaluates all of its financial instruments to determine if such instruments are derivatives, derivatives that qualify for the normal purchase normal sale exception, or contain features that qualify as embedded derivatives. All derivative financial instruments, except for derivatives that qualify for the normal purchase normal sale exception, are recognized on the balance sheet at fair value. Changes in fair value are recognized in earnings if they are not eligible for hedge accounting or in other comprehensive income if they qualify for cash flow hedge accounting. The Company has power purchase contracts at its Roanoke Valley Power Facility (“ROVA”) to manage exposure to power price fluctuations. These contracts cover the period from April 2014 to March 2019 and contracted power prices range from $41.05 to $55.20 per megawatt hour, with a weighted average contract price of $44.67 over the remaining contract lives. The contracts are not designated as hedging instruments, and accordingly their fair value is recognized on the Consolidated Balance Sheets, with changes in fair value recognized in the Consolidated Statements of Operations. Fair value is based on a comparison of contracted prices to projected future market prices which are Level 2 inputs based on the hierarchy defined below, please see Note 9 - Fair Value Measurements to the consolidated financial statements (unaudited). During the fourth quarter of 2016, the Company entered into a Substitute Energy Purchase Agreement (the “SEP Agreement”) which amends our previous power purchase and operating agreement with our customer. The SEP Agreement, which covers the period from March 1, 2017 to March 31, 2019, enables us to fulfill our obligations under the contract without physically operating the facility. The SEP Agreement calls for fixed payments ranging from $21.33 to $24.32 (representing a weighted average price of $23.79 per megawatt hour) while optional power deliveries are $15.26 per megawatt hour. The SEP Agreement meets the definition of a derivative and it does not qualify for the normal purchases and normal sales scope exception. This contract is not designated as a hedging instrument, therefore, its fair value is recognized on the Consolidated Balance Sheets and changes in fair value recognized in the Consolidated Statements of Operations. As the underlying power deliveries option is significantly in the money, the fair value of this derivative is based on comparing expected contracted cash inflows per the SEP Agreement to expected future outflows based on projected market prices. During the fourth quarter of 2017, the Company exited our derivative positions as described in Note 16 - Subsequent Events to the consolidated financial statements (unaudited). The fair value of outstanding derivative instruments not designated as hedging instruments on the accompanying unaudited Consolidated Balance Sheets was as follows (in thousands): Derivative Instruments Balance Sheet Location September 30, 2017 December 31, 2016 Contracts to purchase power Other current liabilities $ 18,097 $ 13,382 Contracts to purchase power Other liabilities 10,100 18,384 Contract to sell power Other current assets 15,879 10,240 Contract to sell power Other assets 6,829 9,528 The effect of derivative instruments not designated as hedging instruments on the accompanying unaudited Consolidated Statements of Operations was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, Derivative Instruments Statements of Operations Location 2017 2016 2017 2016 Contracts to purchase power Derivative (gain) loss $ (6,812 ) $ 5,442 $ (3,570 ) $ 2,164 Contract to sell power Derivative (gain) loss 2,145 — (3,001 ) — $ (4,667 ) $ 5,442 $ (6,571 ) $ 2,164 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | 9. FAIR VALUE MEASUREMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. For other fair value disclosures, see also Note 5 - Restricted Investments And Bond Collateral and Note 8 - Derivative Instruments to the consolidated financial statements (unaudited). • Level 1, defined as observable inputs such as quoted prices in active markets for identical assets. • Level 2, defined as observable inputs other than Level 1 prices. These include quoted prices for similar assets or liabilities in an active market, quoted prices for identical assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The table below sets forth, by level, the Company’s financial assets and liabilities that are accounted for at fair value at September 30, 2017 : Quoted Prices in Active Markets for Identical Assets or Liabilities Significant Other Observable Inputs Fair Value Level 1 Level 2 (In thousands) Assets: Contract to sell power included in Other current assets and Other assets $ 22,708 $ — $ 22,708 Available-for-sale investments included in Restricted investments and bond collateral 79,505 79,505 — Available-for-sale investments included in Reclamation deposits 73,493 73,493 — $ 175,706 $ 152,998 $ 22,708 Liabilities: Contracts to purchase power included in Other current liabilities and Other liabilities $ 28,197 $ — $ 28,197 Warrants issued by WMLP included in Other liabilities 316 316 — $ 28,513 $ 316 $ 28,197 Long-term debt fair value estimates are based on observed prices for securities with an active trading market when available (Level 2) and otherwise using discount rate estimates based on interest rates (Level 3). As of September 30, 2017 , the Company valued the WMLP Term Loan and the San Juan Loan with Level 3 fair values. The estimated fair values of the Company’s debt with fixed and variable interest rates are as follows: Fixed Interest Rate Variable Interest Rate Carrying Value Fair Value Carrying Value Fair Value (In thousands) (In thousands) September 30, 2017 $ 380,583 $ 277,497 $ 690,565 $ 482,551 December 31, 2016 409,362 395,274 699,704 658,557 |
INCOME TAX
INCOME TAX | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 10. INCOME TAX For interim income tax reporting the Company estimates its annual effective tax rate and applies this effective tax rate to its year-to-date pre-tax (loss) income. For the nine months ended September 30, 2016 , the effective tax rate differed from the statutory rate primarily as a result of the U.S. and Canadian valuation allowances and due to the recognition of changes in the Company's net deferred tax assets due to the San Juan Acquisition. For the nine months ended September 30, 2017 the effective tax rate differed from the statutory rate primarily due to the U.S. and Canadian valuation allowances. In connection with the January 31, 2016 San Juan Acquisition during the nine months ended September 30, 2016 , the Company recognized $47.6 million in deferred tax liabilities. Accordingly, the $47.6 million decrease in the Company’s net deferred tax assets resulted in the release of a corresponding $47.6 million valuation allowance and recognition of a tax benefit in the nine months ended September 30, 2016 . Tax Benefits Preservation Plan As of December 31, 2016, WCC had a U.S. federal net operating loss carryforward of $581.4 million , together with certain other tax attributes. WCC's ability to utilize these tax assets to offset future taxable income may be significantly limited if WCC experiences an "ownership change", as defined in Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"). In general, an ownership change will occur if the percentage of the stock owned cumulatively by one or more “5 % shareholders” has increased by more than 50 percentage points over the lowest percentage of stock owned by such shareholders at any time over a rolling three-year period. On September 2, 2017, the board of directors of WCC adopted a tax benefits preservation plan or stockholder rights plan (the "Plan"). The purpose of the Plan is to minimize the likelihood of an ownership change occurring for Section 382 purposes and thus protect WCC's ability to utilize certain net operating loss carryovers and other tax benefits of the Company and its subsidiaries (the “Tax Benefits”) to offset future income. The Plan is intended to act as a deterrent to any person or group acquiring “beneficial ownership” (within the meaning of applicable SEC rules) of 4.75% or more of the outstanding shares of WCC's common stock, par value $0.01 per share without the approval of the board of directors. The description and terms of the Rights (as defined below) applicable to the Plan are set forth in the 382 Rights Agreement, dated as of September 5, 2017 (the “Rights Agreement”), by and between WCC and Broadridge Corporate Issuer Solutions, Inc., as Rights Agent. As part of the Rights Agreement, the board of directors authorized and declared a dividend distribution of one right (a “Right”) for each outstanding share of common stock to stockholders of record at the close of business on September 18, 2017. Each Right entitles the holder to purchase from WCC a unit consisting of one ten thousandth of a share (a “Unit”) of Series A Participating Preferred Stock, par value $0.01 per share, of WCC at a purchase price of $10.00 per Unit, subject to adjustment. Until a Right is exercised, the holder thereof, as such, will have no separate rights as a stockholder of WCC, including the right to vote or to receive dividends in respect of Rights. |
SHAREHOLDERS' DEFICIT AND ACCUM
SHAREHOLDERS' DEFICIT AND ACCUMULATED OTHER COMPREHENSIVE LOSS | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
SHAREHOLDERS' DEFICIT AND ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 11. STOCKHOLDERS’ DEFICIT AND ACCUMULATED OTHER COMPREHENSIVE LOSS Changes in Accumulated Other Comprehensive Loss The following table reflects the changes in accumulated other comprehensive loss by component: Pension Postretirement medical benefits Unrealized gains and losses on available-for-sale securities, net Foreign currency translation adjustment Tax effect of other comprehensive income gains Accumulated other comprehensive income (loss) (In thousands) Balance at December 31, 2016 $ (26,123 ) $ (51,893 ) $ (1,674 ) $ (61,073 ) $ (38,309 ) $ (179,072 ) Other comprehensive income (loss) before reclassifications 189 — 1,184 17,455 (2,503 ) 16,325 Amounts reclassified from accumulated other comprehensive income (loss) 1,765 2,893 290 — — 4,948 Balance at September 30, 2017 $ (24,169 ) $ (49,000 ) $ (200 ) $ (43,618 ) $ (40,812 ) $ (157,799 ) The following table reflects the reclassifications out of accumulated other comprehensive loss for the three and nine months ended September 30, 2017 (in thousands): Details about accumulated other comprehensive loss components Amount reclassified from accumulated other comprehensive loss Affected line items in the statements where presented Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Available-for-sale securities Realized (gains) and losses on available-for-sale securities $ (4 ) $ 290 Other (loss) income Amortization of defined benefit pension items Prior service costs $ 2 $ 6 Cost of sales and Selling and administrative Actuarial losses 581 1,759 Cost of sales and Selling and administrative Total $ 583 $ 1,765 Amortization of postretirement medical items Prior service costs $ (159 ) $ (477 ) Cost of sales and Selling and administrative Actuarial losses 1,123 3,370 Cost of sales and Selling and administrative Total $ 964 $ 2,893 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION | 12. SHARE-BASED COMPENSATION The Company grants employees and non-employee directors restricted stock units. The Company recognized compensation expense from share-based arrangements shown in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Recognition of value of restricted stock units and cash units over vesting period; and issuance of stock $ 1,366 $ 1,391 $ 3,846 $ 3,733 Contributions of stock to the Company’s 401(k) plan — — — 2,192 Total share-based compensation expense $ 1,366 $ 1,391 $ 3,846 $ 5,925 2017 Grant During the nine months ended September 30, 2017 , the Company granted the following stock-based awards under the Amended and Restated 2014 Equity Incentive Plan: • 713,238 restricted stock units, of which 338,968 vest based on a service condition, 187,135 vest based on a service and market condition, and 187,135 vest based on a service and performance condition. • 375,658 cash units (“the Cash Units”), which represent the right to cash equal to the closing price of WCC common stock as of the vesting date, of which 157,880 vest based on a service condition, 108,889 vest based on a service and market condition, and 108,889 vest based on a service and performance condition. Restricted Stock Units Unamortized compensation expense is expected to be recognized over the next three years. A summary of outstanding restricted stock units as of September 30, 2017 is as follows: Units Weighted Average Grant-Date Fair Value Unamortized Compensation Expense (In thousands) Non-vested at December 31, 2016 700,500 $ 15.91 Granted 713,238 3.94 Vested (246,724 ) 18.34 Forfeited (44,870 ) 8.31 Non-vested at September 30, 2017 1,122,144 $ 8.80 $ 4,568 Cash Units The compensation expense related to the Cash Units was $0.3 million and $0.2 million for the nine months ended September 30, 2017 and 2016 , respectively. Because the cash units are settled in cash they are accounted for as a liability award. The accrued liability related to the Cash Units was $0.1 million and $0.4 million as of September 30, 2017 and December 31, 2016 , respectively. Other Plans In May 2016, the Company discontinued matching employees’ 401k contributions with common shares and elected instead to match with cash contributions. During 2016, the Company contributed 342,353 common shares to match employees’ contributions to their 401k plans. 342,353 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | 13. EARNINGS PER SHARE Basic earnings (loss) per share has been computed by dividing the net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during each period. Net income (loss) applicable to common stockholders includes the adjustment for net income or loss attributable to noncontrolling interest. Diluted earnings (loss) per share is computed by including the dilutive effect of common stock that would be issued assuming conversion or exercise of outstanding stock options and and restricted stock units. No such items were included in the computations of diluted loss per share in the three and nine months ended September 30, 2017 and in the three and nine months ended September 30, 2016 because the Company incurred a net loss applicable to common stockholders in these periods and the effect of inclusion would have been anti-dilutive. The table below shows the number of shares that were excluded from the calculation of diluted loss per share because their inclusion would be anti-dilutive to the calculation: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Restricted stock units and stock options 1,201 853 1,201 853 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | 14. SEGMENT INFORMATION Segment information is based on a management approach which requires segmentation based upon the Company’s internal organization, reporting of revenues and operating income (loss). The Company’s operations are classified into six reporting segments: Coal - U.S., Coal - Canada, Coal - WMLP, Power, Heritage, and Corporate. For a detailed description of the Company’s operations segmentation please see our 2016 Form 10-K. Summarized financial information by segment is as follows: Coal - U.S. (1) Coal - Canada Coal - WMLP (1) Power Heritage Corporate Consolidated (In thousands) Three Months Ended September 30, 2017 Revenues $ 142,040 $ 115,688 $ 85,607 $ 20,070 $ — $ (5,394 ) $ 358,011 Depreciation, depletion, and amortization 19,826 8,590 9,691 — — (41 ) 38,066 Operating income (loss) 7,212 1,206 9,451 5,344 (3,599 ) (5,359 ) 14,255 Total assets 547,053 444,058 367,348 58,788 16,726 539 1,434,512 Cash paid for capital expenditures 5,348 3,386 3,527 — — — 12,261 Three Months Ended September 30, 2016 Revenues $ 170,177 $ 96,252 $ 90,320 $ 21,554 $ — $ (6,531 ) $ 371,772 Depreciation, depletion, and amortization 22,221 7,133 11,555 — — (49 ) 40,860 Operating income (loss) 9,220 5,226 5,970 (4,696 ) (3,326 ) (3,641 ) 8,753 Total assets 657,276 503,460 382,098 40,760 16,288 6,172 1,606,054 Cash paid for capital expenditures 4,824 11,313 2,251 — — — 18,388 Nine Months Ended September 30, 2017 Revenues $ 420,445 $ 314,051 $ 241,464 $ 61,177 $ — $ (16,365 ) $ 1,020,772 Depreciation, depletion, and amortization 58,469 25,627 30,152 — — (117 ) 114,131 Operating income (loss) 4,926 (17,632 ) 18,321 4,208 (11,055 ) (16,668 ) (17,900 ) Total assets 547,053 444,058 367,348 58,788 16,726 539 1,434,512 Cash paid for capital expenditures 9,204 7,436 8,725 — — — 25,365 Nine Months Ended September 30, 2016 Revenues $ 478,684 $ 299,336 $ 263,269 $ 65,494 $ — $ (21,560 ) $ 1,085,223 Depreciation, depletion, and amortization 51,913 19,932 41,367 — — (115 ) 113,097 Operating income (loss) 17,474 20,919 2,497 (3,766 ) (10,325 ) (11,310 ) 15,489 Total assets 657,276 503,460 382,098 40,760 16,288 6,172 1,606,054 Cash paid for capital expenditures 12,038 13,801 4,780 — — — 30,619 ____________________ (1) The Coal - WMLP segment recorded revenues of $5.4 million and $16.4 million for intersegment revenues to the Coal - U.S. segment for the three and nine months ended September 30, 2017 , respectively, and $6.5 million and $21.6 million for the three and nine months ended September 30, 2016 , respectively. Eliminations for intersegment revenues and cost of sales are presented within the Corporate segment. |
CONTINGENCIES
CONTINGENCIES | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | 15. CONTINGENCIES Litigation There have been no material changes in our litigation since December 31, 2016 . For additional information, refer to Note 20. Commitments and Contingencie s to the consolidated financial statements of our 2016 Form 10-K. A loss contingency for the 2013 breach of a water containment pond at our Obed mine in Canada remains probable and reasonably estimable. The previous owner, Sherritt International Corporation, continues to fully indemnify us for the actual cost of the remediation as well as the costs of compliance with any regulatory orders, including any fees, fines, or judgments resulting from the water release. As of September 30, 2017 , the Company has recorded $2.4 million in Other current liabilities for the estimated costs of remediation work and a corresponding amount in Receivables - Other to reflect the indemnification by the prior owner. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 16. SUBSEQUENT EVENTS We executed an Assignment and Assumption Agreement with an effective date of October 1, 2017 with the counterparties to our ROVA power purchase and sale contracts, in which, for a settlement payment of approximately $10.1 million , we were released from our power purchase and sales contracts and the counterparty to the purchase contracts has assumed our position in the power sales contract. As a result of this transaction, we are no longer a party to either of these derivative arrangements. In the fourth quarter of 2017, this transaction will result in a charge of $4.6 million and we will recognize $14.4 million of previously deferred revenue related to the straight line recognition of capacity payments from the power sales agreement. Also, in the fourth quarter of 2017 we have received proceeds net of settlement payments from our posted collateral of $6.2 million and also released $7.5 million in outstanding letters of credit on our Revolver . On August 2, 2017 we executed a sales agreement to sell all of the assets that comprise ROVA for $5.0 million in cash which closed on October 20, 2017. Pursuant to the transaction, we retained the related $2.7 million reclamation liability. No additional asset impairment was taken as a result of prior year impairments. On October 30, 2017, we executed a twelfth amendment to our Revolver as described in Item 5. Other Information . The Company has evaluated subsequent events in accordance with ASC 855, Subsequent Events , through the filing date of this Quarterly Report, and determined that no events have occurred that have not been disclosed elsewhere in the notes to the consolidated financial statements (unaudited) that would require adjustments to disclosures in the consolidated financial statements (unaudited). |
BASIS OF PRESENTATION Basis of
BASIS OF PRESENTATION Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Consolidation Policy | The consolidated financial statements of the Company have been prepared in accordance with United States Generally Accepted Accounting Principles (“GAAP”) and require the use of management’s estimates. The financial information contained in this Quarterly Report on Form 10-Q (“Quarterly Report”) is unaudited, but reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the financial information for the periods shown. Such adjustments are of a normal recurring nature. Certain prior period amounts have been reclassified to conform to current period presentation. The results of operations for the nine months ended September 30, 2017 are not necessarily indicative of results to be expected for the year ending December 31, 2017 . These unaudited quarterly consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 (“ 2016 Form 10-K”). |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) which requires companies leasing assets to recognize on their balance sheet a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term on contracts longer than one year. The lessee is permitted to make an accounting policy election to not recognize lease assets and lease liabilities for short-term leases. How leases are recorded on the balance sheet represents a significant change from previous GAAP guidance as described in Accounting Standards Codification (“ASC”) Topic 840, Leases. ASU 2016-02 maintains a distinction between finance leases and operating leases similar to the distinction under previous lease guidance for capital leases and operating leases. The impact of leases reported in the Company’s operating results and statement of cash flows are expected to be similar to previous GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and early adoption is permitted. Adoption of the new lease accounting standard will require the Company to apply the new standard to the earliest period using a modified retrospective approach. The Company is currently in the process of evaluating the impact of the new standard, including the evaluation of the impact, if any, on changes to business processes, systems and controls to support recognition and disclosure under the new guidance, however, at this time is unable to determine the impact this standard will have on the financial statements and related disclosures. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This standard is effective for interim and annual periods beginning after December 15, 2017. We anticipate adopting this ASU on January 1, 2018 will have an immaterial impact to the financial statements including reclassification of accumulated other comprehensive income for available-for-sale securities into equity at January 1, 2018, and future changes to the fair value of available-for-sale securities will be recognized in the income statement. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers which was issued as a new Topic, ASC Topic 606. The new revenue recognition standard supersedes all existing revenue recognition guidance. Under this ASU, an entity should recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2015-14, issued in August 2015, deferred the effective date of ASU 2014-09 to the first quarter of 2018, with early adoption permitted in the first quarter of 2017. The Company intends to adopt the amended guidance as of January 1, 2018. In March, April, May, and December 2016, the FASB issued the following updates, respectively, to provide supplemental adoption guidance and clarification to ASU 2014-09. These standards must be adopted concurrently upon the adoption of ASU 2014-09. We are currently evaluating the potential effects of adopting the provisions of these updates. • ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net). • ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing. • ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients. • ASU 2016-19, Technical Corrections and Improvements. We have established an implementation team to execute a multi-phase plan to adopt the requirements of the new standard. The team is in the process of finalizing its conclusions on how the guidance will be applied to all coal sales contracts comprising greater than half of our consolidated revenues. The team is also evaluating the expanded disclosures required by the new standard and reviewing our processes and internal controls over financial reporting to ensure the appropriate information will be available for these disclosures. No changes will be required to our system capabilities to obtain the appropriate information. Under the new standard, companies may use either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients; or (ii) a modified retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We will be adopting the standard under the full retrospective approach. Based on our implementation team’s analyses, we believe the implementation of the new standard will have a material impact on our consolidated financial statements for sales contracts in which we are entitled to payments from customers to reimburse our costs incurred during final reclamation. Under current GAAP, as these amounts are not fixed and determinable until they are incurred, we have been precluded from recognizing revenue until the costs have been incurred during final reclamation. However, under ASC Topic 606, these payments from customers constitute variable consideration and therefore must be estimated at contract inception and recognized as revenue as we satisfy our performance obligations of delivering coal to the customer. This will ultimately result in a significant acceleration of revenue, most of which will be recognized as a transition adjustment as of January 1, 2016. The implementation team is currently reviewing the models to quantify the exact amount of the transition adjustment and related impact to revenues for the years ended December 31, 2017 and 2016. |
ACQUISITION (Tables)
ACQUISITION (Tables) - San Juan Coal Company | 9 Months Ended |
Sep. 30, 2017 | |
Business Acquisition [Line Items] | |
Summary of purchase consideration and allocation of purchase consideration | The allocation of the purchase consideration follows (in millions): Purchase price: Cash paid $ 121.0 Allocation of purchase price: Assets: Inventories $ 8.8 Total current assets 8.8 Land and mineral rights 143.9 Plant and equipment 74.6 Other assets 1.3 Total assets 228.6 Liabilities: Trade payables and other accrued liabilities 13.4 Production taxes 2.0 Asset retirement obligations 0.7 Total current liabilities 16.1 Asset retirement obligations, less current portion 43.5 Postretirement medical benefits 1.9 Deferred income taxes 46.1 Total liabilities 107.6 Net fair value $ 121.0 |
Summary of pro forma information | The following unaudited pro forma information has been prepared for illustrative purposes only and assumes the San Juan Acquisition occurred on January 1, 2016. The unaudited pro forma results have been prepared based on estimates and assumptions, which the Company believes are reasonable, however, they are not necessarily indicative of the consolidated results of operations had the acquisitions occurred on the dates indicated above, or of future results of operations. Nine Months Ended September 30, 2016 (In thousands, except per share data) Revenues As reported $ 1,085,223 Pro forma (unaudited) 1,111,498 Operating income As reported $ 15,489 Pro forma (unaudited) 16,584 Net loss applicable to common shareholders As reported $ (19,550 ) Pro forma (unaudited) (19,125 ) Net loss per share applicable to common shareholders (basic and diluted) As reported $ (1.06 ) Pro forma (unaudited) (1.04 ) |
VARIABLE INTEREST ENTITY (Table
VARIABLE INTEREST ENTITY (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entities | The following table presents the carrying amounts, after eliminating the effect of intercompany transactions, included in the Consolidated Balance Sheets that are for the use of or are the obligation of WSJ: September 30, 2017 December 31, 2016 (In thousands) Assets $ 215,230 $ 268,910 Liabilities 180,559 243,884 Net carrying amount $ 34,671 $ 25,026 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following: September 30, 2017 December 31, 2016 (In thousands) Coal stockpiles $ 36,013 $ 44,692 Coal fuel inventories 1,338 6,816 Materials and supplies 76,669 77,628 Reserve for obsolete inventory (3,844 ) (3,621 ) Total $ 110,176 $ 125,515 |
RESTRICTED INVESTMENTS AND BO27
RESTRICTED INVESTMENTS AND BOND COLLATERAL (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Restricted Investments and Bond Collateral [Abstract] | |
Carrying value and estimated fair value of restricted investments and bond collateral | The Company’s carrying value and estimated fair value of its restricted investments at September 30, 2017 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cash and cash equivalents $ 65,441 $ 3,443 $ 68,884 Time deposits 2,467 — 2,467 Available-for-sale 79,505 73,493 152,998 $ 147,413 $ 76,936 $ 224,349 The Company’s carrying value and estimated fair value of its restricted investments at December 31, 2016 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cash and cash equivalents $ 66,860 $ 2,673 $ 69,533 Time deposits 2,473 — 2,473 Available-for-sale 75,580 71,689 147,269 $ 144,913 $ 74,362 $ 219,275 |
Amortized cost, gross unrealized holding gains and losses and fair value of available-for-sale securities | The cost basis, gross unrealized holding gains and losses, and fair value of available-for-sale securities at September 30, 2017 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cost basis $ 79,724 $ 73,470 $ 153,194 Gross unrealized holding gains 520 624 1,144 Gross unrealized holding losses (739 ) (601 ) (1,340 ) Fair value $ 79,505 $ 73,493 $ 152,998 The cost basis, gross unrealized holding gains and losses, and fair value of available-for-sale securities at December 31, 2016 were as follows: Restricted Investments and Bond Collateral Reclamation Deposits Total Restricted Investments (In thousands) Cost basis $ 76,558 $ 72,381 $ 148,939 Gross unrealized holding gains 251 453 704 Gross unrealized holding losses (1,229 ) (1,145 ) (2,374 ) Fair value $ 75,580 $ 71,689 $ 147,269 |
LINES OF CREDIT AND DEBT (Table
LINES OF CREDIT AND DEBT (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Outstanding lines of credit and long-term debt | The Company and its subsidiaries are subject to the following debt arrangements: Total Debt Outstanding September 30, 2017 December 31, 2016 (In thousands) 8.75% Notes $ 350,000 $ 350,000 Term Loan 321,417 323,883 San Juan Loan 66,230 95,000 WMLP Term Loan 311,628 306,189 Revolver 10,540 — WMLP Revolver — — Capital lease obligations 36,736 55,061 Other debt 4,512 16,464 Total debt 1,101,063 1,146,597 Less debt discount and issuance costs, net (29,915 ) (37,531 ) Less current installments (49,712 ) (86,272 ) Long-term debt, less current installments $ 1,021,436 $ 1,022,794 |
Contractual maturities of all long-term debt | The following table presents remaining aggregate contractual debt maturities of all long-term debt as of September 30, 2017 (in thousands): Debt Held by WMLP All Other Debt Total Debt Outstanding 2017 $ 1,660 $ 30,572 $ 32,232 2018 315,804 18,852 334,656 2019 4,105 15,439 19,544 2020 1,694 338,571 340,265 2021 1,586 21,164 22,750 Thereafter 1,616 350,000 351,616 Total debt $ 326,465 $ 774,598 $ 1,101,063 |
POSTRETIREMENT MEDICAL BENEFI29
POSTRETIREMENT MEDICAL BENEFITS AND PENSION (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Postretirement Medical Benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Components of net periodic benefit cost | The components of net periodic postretirement medical benefit cost are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Components of net periodic benefit cost: Service cost $ 793 $ 763 $ 2,380 $ 2,507 Interest cost 3,197 3,075 9,590 9,278 Amortization of deferred items 964 368 2,893 891 Total net periodic benefit cost $ 4,954 $ 4,206 $ 14,863 $ 12,676 The following table shows the net periodic postretirement medical benefit costs that relate to current and former mining operations: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Former mining operations $ 2,305 $ 2,135 $ 6,916 $ 6,405 Current operations 2,649 2,071 7,947 6,271 Total net periodic benefit cost $ 4,954 $ 4,206 $ 14,863 $ 12,676 |
Pension | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Components of net periodic benefit cost | The Company incurred net periodic benefit costs of providing these pension benefits as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Components of net periodic benefit cost: Service cost $ 348 $ 373 $ 1,133 $ 1,242 Interest cost 2,596 2,564 7,855 7,926 Expected return on plan assets (3,643 ) (3,349 ) (10,918 ) (10,390 ) Settlements — 247 269 247 Amortization of deferred items 588 1,294 1,765 3,639 Total net periodic pension cost $ (111 ) $ 1,129 $ 104 $ 2,664 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The fair value of outstanding derivative instruments not designated as hedging instruments on the accompanying unaudited Consolidated Balance Sheets was as follows (in thousands): Derivative Instruments Balance Sheet Location September 30, 2017 December 31, 2016 Contracts to purchase power Other current liabilities $ 18,097 $ 13,382 Contracts to purchase power Other liabilities 10,100 18,384 Contract to sell power Other current assets 15,879 10,240 Contract to sell power Other assets 6,829 9,528 The effect of derivative instruments not designated as hedging instruments on the accompanying unaudited Consolidated Statements of Operations was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, Derivative Instruments Statements of Operations Location 2017 2016 2017 2016 Contracts to purchase power Derivative (gain) loss $ (6,812 ) $ 5,442 $ (3,570 ) $ 2,164 Contract to sell power Derivative (gain) loss 2,145 — (3,001 ) — $ (4,667 ) $ 5,442 $ (6,571 ) $ 2,164 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of financial assets at fair value | The table below sets forth, by level, the Company’s financial assets and liabilities that are accounted for at fair value at September 30, 2017 : Quoted Prices in Active Markets for Identical Assets or Liabilities Significant Other Observable Inputs Fair Value Level 1 Level 2 (In thousands) Assets: Contract to sell power included in Other current assets and Other assets $ 22,708 $ — $ 22,708 Available-for-sale investments included in Restricted investments and bond collateral 79,505 79,505 — Available-for-sale investments included in Reclamation deposits 73,493 73,493 — $ 175,706 $ 152,998 $ 22,708 Liabilities: Contracts to purchase power included in Other current liabilities and Other liabilities $ 28,197 $ — $ 28,197 Warrants issued by WMLP included in Other liabilities 316 316 — $ 28,513 $ 316 $ 28,197 |
Estimated fair values of Company's debt | The estimated fair values of the Company’s debt with fixed and variable interest rates are as follows: Fixed Interest Rate Variable Interest Rate Carrying Value Fair Value Carrying Value Fair Value (In thousands) (In thousands) September 30, 2017 $ 380,583 $ 277,497 $ 690,565 $ 482,551 December 31, 2016 409,362 395,274 699,704 658,557 |
SHAREHOLDERS' DEFICIT AND ACC32
SHAREHOLDERS' DEFICIT AND ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Income by component | The following table reflects the changes in accumulated other comprehensive loss by component: Pension Postretirement medical benefits Unrealized gains and losses on available-for-sale securities, net Foreign currency translation adjustment Tax effect of other comprehensive income gains Accumulated other comprehensive income (loss) (In thousands) Balance at December 31, 2016 $ (26,123 ) $ (51,893 ) $ (1,674 ) $ (61,073 ) $ (38,309 ) $ (179,072 ) Other comprehensive income (loss) before reclassifications 189 — 1,184 17,455 (2,503 ) 16,325 Amounts reclassified from accumulated other comprehensive income (loss) 1,765 2,893 290 — — 4,948 Balance at September 30, 2017 $ (24,169 ) $ (49,000 ) $ (200 ) $ (43,618 ) $ (40,812 ) $ (157,799 ) |
Reclassifications out of Accumulated Other Comprehensive Income for the period | The following table reflects the reclassifications out of accumulated other comprehensive loss for the three and nine months ended September 30, 2017 (in thousands): Details about accumulated other comprehensive loss components Amount reclassified from accumulated other comprehensive loss Affected line items in the statements where presented Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Available-for-sale securities Realized (gains) and losses on available-for-sale securities $ (4 ) $ 290 Other (loss) income Amortization of defined benefit pension items Prior service costs $ 2 $ 6 Cost of sales and Selling and administrative Actuarial losses 581 1,759 Cost of sales and Selling and administrative Total $ 583 $ 1,765 Amortization of postretirement medical items Prior service costs $ (159 ) $ (477 ) Cost of sales and Selling and administrative Actuarial losses 1,123 3,370 Cost of sales and Selling and administrative Total $ 964 $ 2,893 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Compensation cost arising from share-based arrangements | The Company recognized compensation expense from share-based arrangements shown in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Recognition of value of restricted stock units and cash units over vesting period; and issuance of stock $ 1,366 $ 1,391 $ 3,846 $ 3,733 Contributions of stock to the Company’s 401(k) plan — — — 2,192 Total share-based compensation expense $ 1,366 $ 1,391 $ 3,846 $ 5,925 |
Summary of Restricted Stock Unit activity | A summary of outstanding restricted stock units as of September 30, 2017 is as follows: Units Weighted Average Grant-Date Fair Value Unamortized Compensation Expense (In thousands) Non-vested at December 31, 2016 700,500 $ 15.91 Granted 713,238 3.94 Vested (246,724 ) 18.34 Forfeited (44,870 ) 8.31 Non-vested at September 30, 2017 1,122,144 $ 8.80 $ 4,568 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The table below shows the number of shares that were excluded from the calculation of diluted loss per share because their inclusion would be anti-dilutive to the calculation: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 (In thousands) Restricted stock units and stock options 1,201 853 1,201 853 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Summarized financial information by segment | Summarized financial information by segment is as follows: Coal - U.S. (1) Coal - Canada Coal - WMLP (1) Power Heritage Corporate Consolidated (In thousands) Three Months Ended September 30, 2017 Revenues $ 142,040 $ 115,688 $ 85,607 $ 20,070 $ — $ (5,394 ) $ 358,011 Depreciation, depletion, and amortization 19,826 8,590 9,691 — — (41 ) 38,066 Operating income (loss) 7,212 1,206 9,451 5,344 (3,599 ) (5,359 ) 14,255 Total assets 547,053 444,058 367,348 58,788 16,726 539 1,434,512 Cash paid for capital expenditures 5,348 3,386 3,527 — — — 12,261 Three Months Ended September 30, 2016 Revenues $ 170,177 $ 96,252 $ 90,320 $ 21,554 $ — $ (6,531 ) $ 371,772 Depreciation, depletion, and amortization 22,221 7,133 11,555 — — (49 ) 40,860 Operating income (loss) 9,220 5,226 5,970 (4,696 ) (3,326 ) (3,641 ) 8,753 Total assets 657,276 503,460 382,098 40,760 16,288 6,172 1,606,054 Cash paid for capital expenditures 4,824 11,313 2,251 — — — 18,388 Nine Months Ended September 30, 2017 Revenues $ 420,445 $ 314,051 $ 241,464 $ 61,177 $ — $ (16,365 ) $ 1,020,772 Depreciation, depletion, and amortization 58,469 25,627 30,152 — — (117 ) 114,131 Operating income (loss) 4,926 (17,632 ) 18,321 4,208 (11,055 ) (16,668 ) (17,900 ) Total assets 547,053 444,058 367,348 58,788 16,726 539 1,434,512 Cash paid for capital expenditures 9,204 7,436 8,725 — — — 25,365 Nine Months Ended September 30, 2016 Revenues $ 478,684 $ 299,336 $ 263,269 $ 65,494 $ — $ (21,560 ) $ 1,085,223 Depreciation, depletion, and amortization 51,913 19,932 41,367 — — (115 ) 113,097 Operating income (loss) 17,474 20,919 2,497 (3,766 ) (10,325 ) (11,310 ) 15,489 Total assets 657,276 503,460 382,098 40,760 16,288 6,172 1,606,054 Cash paid for capital expenditures 12,038 13,801 4,780 — — — 30,619 ____________________ (1) The Coal - WMLP segment recorded revenues of $5.4 million and $16.4 million for intersegment revenues to the Coal - U.S. segment for the three and nine months ended September 30, 2017 , respectively, and $6.5 million and $21.6 million for the three and nine months ended September 30, 2016 , respectively. Eliminations for intersegment revenues and cost of sales are presented within the Corporate segment. |
ACQUISITION - Narrative (Detail
ACQUISITION - Narrative (Details) - USD ($) | Jan. 31, 2016 | Dec. 31, 2016 |
San Juan Coal Company | ||
Business Acquisition [Line Items] | ||
Cash paid | $ 121,000,000 | $ 121,000,000 |
Loan from NM Capital Utility Corporation | Term Notes | ||
Business Acquisition [Line Items] | ||
Senior secured notes | $ 125,000,000 |
ACQUISITION - Summary of purcha
ACQUISITION - Summary of purchase consideration and allocation of purchase consideration (Details) - San Juan Coal Company - USD ($) $ in Millions | Jan. 31, 2016 | Dec. 31, 2016 |
Purchase Price: | ||
Cash paid | $ 121 | $ 121 |
Assets: | ||
Inventories | 8.8 | |
Total current assets | 8.8 | |
Land and mineral rights | 143.9 | |
Plant and equipment | 74.6 | |
Other assets | 1.3 | |
Total Assets | 228.6 | |
Liabilities: | ||
Trade payables and other accrued liabilities | 13.4 | |
Production taxes | 2 | |
Asset retirement obligations | 0.7 | |
Total current liabilities | 16.1 | |
Asset retirement obligations, less current portion | 43.5 | |
Postretirement medical benefits | 1.9 | |
Deferred income taxes | 46.1 | |
Total Liabilities | 107.6 | |
Net fair value | $ 121 |
ACQUISITION - Summary of Pro Fo
ACQUISITION - Summary of Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues | ||||
As reported | $ 358,011 | $ 371,772 | $ 1,020,772 | $ 1,085,223 |
Pro forma (unaudited) | 1,111,498 | |||
Operating income | ||||
As reported | 14,255 | 8,753 | (17,900) | 15,489 |
Pro forma (unaudited) | 16,584 | |||
Net loss applicable to common shareholders | ||||
As reported | $ (19,222) | $ (18,368) | $ (106,409) | (19,550) |
Pro forma (unaudited) | $ (19,125) | |||
Net loss per share applicable to common shareholders (basic and diluted) | ||||
As reported, (in dollars per share) | $ (1.03) | $ (0.99) | $ (5.70) | $ (1.06) |
Pro forma (unaudited) (in dollars per share) | $ (1.04) |
VARIABLE INTEREST ENTITY (Detai
VARIABLE INTEREST ENTITY (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Variable Interest Entity [Line Items] | ||
Ownership percentage in Constitution (percent) | 100.00% | |
Variable Interest Entity, Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Assets | $ 215,230 | $ 268,910 |
Liabilities | 180,559 | 243,884 |
Net carrying amount | $ 34,671 | $ 25,026 |
INVENTORIES (Detail)
INVENTORIES (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Coal stockpiles | $ 36,013 | $ 44,692 |
Coal fuel inventories | 1,338 | 6,816 |
Materials and supplies | 76,669 | 77,628 |
Reserve for obsolete inventory | (3,844) | (3,621) |
Total | $ 110,176 | $ 125,515 |
RESTRICTED INVESTMENTS AND BO41
RESTRICTED INVESTMENTS AND BOND COLLATERAL - Carrying Value and Estimated Fair Value of Restricted Investments and Bond Collateral (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Investment [Line Items] | ||
Restricted investments and bond collateral | $ 224,349 | $ 219,275 |
Restricted Investments and Bond Collateral | ||
Investment [Line Items] | ||
Cash and cash equivalents | 65,441 | 66,860 |
Time deposits | 2,467 | 2,473 |
Available-for-sale | 79,505 | 75,580 |
Restricted investments and bond collateral | 147,413 | 144,913 |
Reclamation Deposits | ||
Investment [Line Items] | ||
Cash and cash equivalents | 3,443 | 2,673 |
Time deposits | 0 | 0 |
Available-for-sale | 73,493 | 71,689 |
Restricted investments and bond collateral | 76,936 | 74,362 |
Restricted Investments | ||
Investment [Line Items] | ||
Cash and cash equivalents | 68,884 | 69,533 |
Time deposits | 2,467 | 2,473 |
Available-for-sale | 152,998 | 147,269 |
Restricted investments and bond collateral | $ 224,349 | $ 219,275 |
RESTRICTED INVESTMENTS AND BO42
RESTRICTED INVESTMENTS AND BOND COLLATERAL - Amortized Cost, Gross Unrealized Holding Gains and Losses and Fair Value of Held-to-Maturity Securities (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Restricted Investments and Bond Collateral | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost basis | $ 79,724 | $ 76,558 |
Gross unrealized holding gains | 520 | 251 |
Gross unrealized holding losses | (739) | (1,229) |
Fair value | 79,505 | 75,580 |
Reclamation Deposits | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost basis | 73,470 | 72,381 |
Gross unrealized holding gains | 624 | 453 |
Gross unrealized holding losses | (601) | (1,145) |
Fair value | 73,493 | 71,689 |
Restricted Investments | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cost basis | 153,194 | 148,939 |
Gross unrealized holding gains | 1,144 | 704 |
Gross unrealized holding losses | (1,340) | (2,374) |
Fair value | $ 152,998 | $ 147,269 |
DEBT AND LINES OF CREDIT - Outs
DEBT AND LINES OF CREDIT - Outstanding Lines of Credit and Debt (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Total debt | $ 1,101,063 | $ 1,146,597 |
Less debt discount and issuance costs, net | (29,915) | (37,531) |
Less current installments | (49,712) | (86,272) |
Long-term debt, less current installments | 1,021,436 | 1,022,794 |
Capital lease obligations | ||
Debt Instrument [Line Items] | ||
Total debt | 36,736 | 55,061 |
Other | ||
Debt Instrument [Line Items] | ||
Total debt | 4,512 | 16,464 |
Senior secured notes due 2022 | Senior Notes | ||
Debt Instrument [Line Items] | ||
Total debt | $ 350,000 | 350,000 |
Stated interest rate (percent) | 8.75% | |
Term loan facility due 2020 | Term Notes | ||
Debt Instrument [Line Items] | ||
Total debt | $ 321,417 | 323,883 |
Stated interest rate (percent) | 7.796% | |
San Juan Loan | Term Notes | ||
Debt Instrument [Line Items] | ||
Total debt | $ 66,230 | 95,000 |
Stated interest rate (percent) | 7.25% | |
WML Term Debt Due 2018 | Term Notes | ||
Debt Instrument [Line Items] | ||
Total debt | $ 311,628 | 306,189 |
Revolving line of credit | Revolving line of credit | ||
Debt Instrument [Line Items] | ||
Total debt | 10,540 | 0 |
WMLP revolving line of credit | Revolving line of credit | ||
Debt Instrument [Line Items] | ||
Total debt | $ 0 | $ 0 |
DEBT AND LINES OF CREDIT - Cont
DEBT AND LINES OF CREDIT - Contractual Maturities of Long Term Debt (Details) $ in Thousands | Sep. 30, 2017USD ($) |
Debt Instrument [Line Items] | |
2,017 | $ 32,232 |
2,018 | 334,656 |
2,019 | 19,544 |
2,020 | 340,265 |
2,021 | 22,750 |
Thereafter | 351,616 |
Total | 1,101,063 |
Debt Held by WMLP | |
Debt Instrument [Line Items] | |
2,017 | 1,660 |
2,018 | 315,804 |
2,019 | 4,105 |
2,020 | 1,694 |
2,021 | 1,586 |
Thereafter | 1,616 |
Total | 326,465 |
All Other Debt | |
Debt Instrument [Line Items] | |
2,017 | 30,572 |
2,018 | 18,852 |
2,019 | 15,439 |
2,020 | 338,571 |
2,021 | 21,164 |
Thereafter | 350,000 |
Total | $ 774,598 |
DEBT AND LINES OF CREDIT - Addi
DEBT AND LINES OF CREDIT - Additional Information (Detail) - USD ($) | Nov. 14, 2017 | Oct. 27, 2017 | Jul. 28, 2017 | Sep. 30, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Jan. 31, 2016 |
Debt Instrument [Line Items] | ||||||||
Debt and Capital Lease Obligations | $ 1,101,063,000 | $ 1,101,063,000 | $ 1,146,597,000 | |||||
Non-cash interest expense | 6,981,000 | $ 6,879,000 | ||||||
Capital lease obligations incurred | 700,000 | |||||||
Revolving line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 50,000,000 | 50,000,000 | ||||||
Remaining borrowing capacity | 16,742,869 | 16,742,869 | ||||||
Line of credit outstanding | 9,880,000 | 9,880,000 | ||||||
Borrowing base restrictions | (12,800,000) | (12,800,000) | ||||||
Outstanding letters of credit | 10,540,147 | 10,540,147 | ||||||
Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt and Capital Lease Obligations | $ 321,417,000 | $ 321,417,000 | 323,883,000 | |||||
Stated interest rate (percent) | 7.796% | 7.796% | ||||||
Senior secured notes due 2022 | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt and Capital Lease Obligations | $ 350,000,000 | $ 350,000,000 | 350,000,000 | |||||
Stated interest rate (percent) | 8.75% | 8.75% | ||||||
San Juan Loan | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt and Capital Lease Obligations | $ 66,230,000 | $ 66,230,000 | 95,000,000 | |||||
Stated interest rate (percent) | 7.25% | 7.25% | ||||||
Senior secured notes | $ 125,000,000 | |||||||
Interest rate at period end (percent) | 10.57% | 10.57% | ||||||
WML Term Debt Due 2018 | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum capacity to make distributions | $ 15,000,000 | $ 15,000,000 | ||||||
Consolidated net leverage ratio (in excess at June 30,2017) | 3.75 | 3.75 | ||||||
Fixed charge coverage ratio (below at June 30, 2017) | 1 | 1 | ||||||
Payments of capital distributions | $ 14,800,000 | |||||||
Minimum liquidity requirement | $ 7,500,000 | 7,500,000 | ||||||
WML Term Debt Due 2018 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt and Capital Lease Obligations | $ 311,628,000 | $ 311,628,000 | $ 306,189,000 | |||||
Interest rate at period end (percent) | 9.80% | 9.80% | ||||||
Non-cash interest expense | $ 2,300,000 | $ 7,000,000 | ||||||
Debt outstanding | 288,600,000 | 288,600,000 | ||||||
Accrued paid-in-kind interest | 23,100,000 | 23,100,000 | ||||||
Seasonal Increase to Borrowing Capacity | Revolving line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 60,000,000 | 60,000,000 | ||||||
USD Denominated Sub-facility | Revolving line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 30,000,000 | 30,000,000 | ||||||
USD Denominated Sub-facility with Seasonal Increase | Revolving line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 35,000,000 | 35,000,000 | ||||||
CAD-Denominated Sub-facility | Revolving line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 20,000,000 | 20,000,000 | ||||||
CAD Denominated Sub-facility with Seasonal Increase | Revolving line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 25,000,000 | 25,000,000 | ||||||
WMLP and subsidiaries | Revolving line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | 15,000,000 | 15,000,000 | ||||||
Remaining borrowing capacity | 14,800,000 | 14,800,000 | ||||||
WMLP and subsidiaries | Letter of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | $ 10,000,000 | $ 10,000,000 | ||||||
London Interbank Offered Rate (LIBOR) | WML Term Debt Due 2018 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate (percent) | 8.50% | |||||||
Debt instrument, floor interest rate (percent) | 0.75% | 0.75% | ||||||
Interest rate at period end (percent) | 1.30% | 1.30% | ||||||
One-month LIBOR | Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate (percent) | 6.50% | |||||||
Percentage added to the base rate before including the basis spread (percent) | 1.00% | |||||||
Two-month LIBOR | Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate (percent) | 6.50% | |||||||
Three-month LIBOR | Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate (percent) | 6.50% | |||||||
Six-month LIBOR | Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate (percent) | 6.50% | |||||||
Federal Funds Rate | Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage added to the base rate before including the basis spread (percent) | 0.05% | |||||||
Federal Funds Rate plus 0.05% | Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate (percent) | 5.50% | |||||||
One-month LIBOR plus 1% | Term loan facility due 2020 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate (percent) | 5.50% | |||||||
Minimum | WML Term Debt Due 2018 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Paid-in-kind interest (percent) | 1.00% | |||||||
Maximum | WML Term Debt Due 2018 | Term Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Paid-in-kind interest (percent) | 3.00% | |||||||
Common Units | ||||||||
Debt Instrument [Line Items] | ||||||||
Distribution declared (dollars per unit) | $ 0.1333 | |||||||
Common Units | Subsequent Event | ||||||||
Debt Instrument [Line Items] | ||||||||
Distribution declared (dollars per unit) | $ 0.1155 | |||||||
Decrease in distribution declared (dollars per unit) | $ 0.0178 | |||||||
Forecast | ||||||||
Debt Instrument [Line Items] | ||||||||
Quarterly Aggregate Distribution to Unit Holders | $ 200,000 |
POSTRETIREMENT MEDICAL BENEFI46
POSTRETIREMENT MEDICAL BENEFITS AND PENSION - Postretirement Medicial Benefit Obligations Balance Sheet Disclosures (Details) - Postretirement Medical Benefits - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Components of net periodic benefit cost: | ||||
Service cost | $ 793 | $ 763 | $ 2,380 | $ 2,507 |
Interest cost | 3,197 | 3,075 | 9,590 | 9,278 |
Amortization of deferred items | 964 | 368 | 2,893 | 891 |
Total net periodic benefit cost | $ 4,954 | $ 4,206 | $ 14,863 | $ 12,676 |
POSTRETIREMENT MEDICAL BENEFI47
POSTRETIREMENT MEDICAL BENEFITS AND PENSION - Postretirement Medical Benefit Obligations Income Statement Disclosures (Details) - Postretirement Medical Benefits - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Net periodic postretirement medical benefit costs relating to current and former mining operations: | ||||
Total net periodic benefit cost | $ 4,954 | $ 4,206 | $ 14,863 | $ 12,676 |
Former Mining Operations | ||||
Net periodic postretirement medical benefit costs relating to current and former mining operations: | ||||
Total net periodic benefit cost | 2,305 | 2,135 | 6,916 | 6,405 |
Current Operations | ||||
Net periodic postretirement medical benefit costs relating to current and former mining operations: | ||||
Total net periodic benefit cost | $ 2,649 | $ 2,071 | $ 7,947 | $ 6,271 |
POSTRETIREMENT MEDICAL BENEFI48
POSTRETIREMENT MEDICAL BENEFITS AND PENSION - Pension Benefit Disclosures (Details) - Pension - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Service cost | $ 348 | $ 373 | $ 1,133 | $ 1,242 |
Interest cost | 2,596 | 2,564 | 7,855 | 7,926 |
Expected return on plan assets | (3,643) | (3,349) | (10,918) | (10,390) |
Settlements | 0 | (247) | (269) | (247) |
Amortization of deferred items | 588 | 1,294 | 1,765 | 3,639 |
Total net periodic benefit cost | (111) | $ 1,129 | 104 | 2,664 |
Employer contributions during the period | 1,100 | $ 600 | ||
Expected employer contributions to pension plans during the remainder of the year | $ 100 | $ 100 |
DERIVATIVE INSTRUMENTS (Details
DERIVATIVE INSTRUMENTS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)$ / MWh | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | |
Derivative [Line Items] | |||||
Gain (loss) on derivative, net | $ 4,667 | $ (5,442) | $ 6,571 | $ (2,164) | |
Contract to Sell Power | |||||
Derivative [Line Items] | |||||
Optional power delivery, price | $ / MWh | 15.26 | ||||
Not Designated as Hedging Instrument | Contract to Purchase Power [Member] | Derivative loss | |||||
Derivative [Line Items] | |||||
Gain (loss) on derivative, net | (6,812) | 5,442 | $ (3,570) | 2,164 | |
Not Designated as Hedging Instrument | Contract to Sell Power | Derivative loss | |||||
Derivative [Line Items] | |||||
Gain (loss) on derivative, net | 2,145 | 0 | (3,001) | 0 | |
Not Designated as Hedging Instrument | Contract to Sell Power | Other current assets | |||||
Derivative [Line Items] | |||||
Derivative asset | 15,879 | 15,879 | $ 10,240 | ||
Not Designated as Hedging Instrument | Contract to Sell Power | Other assets | |||||
Derivative [Line Items] | |||||
Derivative asset | 6,829 | 6,829 | 9,528 | ||
Not Designated as Hedging Instrument | Power Contract | Derivative loss | |||||
Derivative [Line Items] | |||||
Gain (loss) on derivative, net | (4,667) | $ 5,442 | (6,571) | $ 2,164 | |
Not Designated as Hedging Instrument | Power Contract | Other current liabilities | |||||
Derivative [Line Items] | |||||
Derivative liability | 18,097 | 18,097 | 13,382 | ||
Not Designated as Hedging Instrument | Power Contract | Other liabilities | |||||
Derivative [Line Items] | |||||
Derivative liability | $ 10,100 | $ 10,100 | $ 18,384 | ||
Minimum | Contract to Sell Power | |||||
Derivative [Line Items] | |||||
Contracted power price notional amount | $ / MWh | 21.33 | ||||
Minimum | Power Contract | |||||
Derivative [Line Items] | |||||
Contracted power price notional amount | $ / MWh | 41.05 | ||||
Maximum | Contract to Sell Power | |||||
Derivative [Line Items] | |||||
Contracted power price notional amount | $ / MWh | 24.32 | ||||
Maximum | Power Contract | |||||
Derivative [Line Items] | |||||
Contracted power price notional amount | $ / MWh | 55.2 | ||||
Weighted Average | Contract to Sell Power | |||||
Derivative [Line Items] | |||||
Contracted power price notional amount | $ / MWh | 23.79 | ||||
Weighted Average | Power Contract | |||||
Derivative [Line Items] | |||||
Contracted power price notional amount | $ / MWh | 44.67 |
FAIR VALUE MEASUREMENTS Summary
FAIR VALUE MEASUREMENTS Summary of Financial Assets at Fair Value (Details) - Fair Value, Measurements, Recurring $ in Thousands | Sep. 30, 2017USD ($) |
Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Available-for-sale investments included in Restricted investments and bond collateral | $ 79,505 |
Available-for-sale investments included in Reclamation deposits | 73,493 |
Available-for-sale investments | 152,998 |
Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Available-for-sale investments included in Restricted investments and bond collateral | 0 |
Available-for-sale investments included in Reclamation deposits | 0 |
Available-for-sale investments | 22,708 |
Fair Value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Available-for-sale investments included in Restricted investments and bond collateral | 79,505 |
Available-for-sale investments included in Reclamation deposits | 73,493 |
Available-for-sale investments | 175,706 |
Other Current Assets and Other Assets [Member] | Power Contract | Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative asset | 0 |
Other Current Assets and Other Assets [Member] | Power Contract | Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative asset | 22,708 |
Other Current Assets and Other Assets [Member] | Power Contract | Fair Value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative asset | 22,708 |
Other current liabilities and other liabilities | Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 316 |
Other current liabilities and other liabilities | Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 28,197 |
Other current liabilities and other liabilities | Fair Value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 28,513 |
Other current liabilities and other liabilities | Power Contract | Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 0 |
Other current liabilities and other liabilities | Power Contract | Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 28,197 |
Other current liabilities and other liabilities | Power Contract | Fair Value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 28,197 |
Other liabilities | Warrant | Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 316 |
Other liabilities | Warrant | Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | 0 |
Other liabilities | Warrant | Fair Value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative liability | $ 316 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - Significant unobservable inputs, Level 3 - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt at fixed interest rate | $ 380,583 | $ 409,362 |
Debt at variable interest rate | 690,565 | 699,704 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt at fixed interest rate | 277,497 | 395,274 |
Debt at variable interest rate | $ 482,551 | $ 658,557 |
INCOME TAX Income Tax Disclosur
INCOME TAX Income Tax Disclosure (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Business Acquisition [Line Items] | |||
Decrease to deferred tax assets | $ 47.6 | ||
Release of valuation allowance | $ 47.6 | ||
Net operating loss carryforward | $ 581.4 | ||
Ownership interest percentage, without Board approval, that triggers the stockholder rights plan (percent) | 4.75% | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Rights Agreement, exercise price per unit (in dollars per unit) | $ 10 | ||
San Juan Coal Company | |||
Business Acquisition [Line Items] | |||
Deferred income taxes | $ 47.6 | ||
Series A participating preferred stock | |||
Business Acquisition [Line Items] | |||
Fraction of share represented by each right under the Rights Agreement (shares) | 0.00010 | ||
Preferred stock, par value (in dollars per share) | $ 0.01 |
SHAREHOLDERS' DEFICIT AND ACC53
SHAREHOLDERS' DEFICIT AND ACCUMULATED OTHER COMPREHENSIVE LOSS - Changes in Accumulated Other Comprehensive Income by component (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Balance at beginning of period | $ (179,072) |
Other comprehensive income before reclassifications | 16,325 |
Amounts reclassified from accumulated other comprehensive income (loss) | 4,948 |
Balance at end of period | (157,799) |
Defined benefit plans adjustment | Pension | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Balance at beginning of period | (26,123) |
Other comprehensive income before reclassifications | 189 |
Amounts reclassified from accumulated other comprehensive income (loss) | 1,765 |
Balance at end of period | (24,169) |
Defined benefit plans adjustment | Postretirement Medical Benefits | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Balance at beginning of period | (51,893) |
Other comprehensive income before reclassifications | 0 |
Amounts reclassified from accumulated other comprehensive income (loss) | 2,893 |
Balance at end of period | (49,000) |
Available for sale securities | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Balance at beginning of period | (1,674) |
Other comprehensive income before reclassifications | 1,184 |
Amounts reclassified from accumulated other comprehensive income (loss) | 290 |
Balance at end of period | (200) |
Foreign currency translation adjustment | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Balance at beginning of period | (61,073) |
Other comprehensive income before reclassifications | 17,455 |
Balance at end of period | (43,618) |
Tax effect of other comprehensive income gains | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Balance at beginning of period | (38,309) |
Other comprehensive income before reclassifications | (2,503) |
Balance at end of period | $ (40,812) |
SHAREHOLDERS' DEFICIT AND ACC54
SHAREHOLDERS' DEFICIT AND ACCUMULATED OTHER COMPREHENSIVE LOSS - Reclassifications out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2017 | Sep. 30, 2017 | |
Defined benefit plans adjustment | Pension | ||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | ||
Prior service costs | $ 2 | $ 6 |
Actuarial losses | 581 | 1,759 |
Amortization of defined benefit pension and postretirement medical benefits | 583 | 1,765 |
Defined benefit plans adjustment | Postretirement Medical Benefits | ||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | ||
Prior service costs | (159) | (477) |
Actuarial losses | 1,123 | 3,370 |
Amortization of defined benefit pension and postretirement medical benefits | 964 | 2,893 |
Other (loss) income | Unrealized Gains and Losses on Available-for-sale Securities, Net | ||
Reclassification out of Accumulated Other Comprehensive Income [Line Items] | ||
Realized (gains) and losses on available-for-sale securities | $ (4) | $ 290 |
SHARE-BASED COMPENSATION - Comp
SHARE-BASED COMPENSATION - Compensation Expense from Share-Based Arrangements (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||
Recognition of fair value of restricted stock units, stock options, and SARs over vesting period; and issuance of common stock | $ 1,366 | $ 1,391 | $ 3,846 | $ 3,733 | |
Contributions of stock to the Company's 401(k) plan | 0 | 0 | 0 | 2,192 | |
Total share-based compensation expense | $ 1,366 | $ 1,391 | $ 3,846 | $ 5,925 | |
Company shares contributed to match employees' contributions to their 401k plans (shares) | 342,353 |
SHARE-BASED COMPENSATION - Gran
SHARE-BASED COMPENSATION - Grants (Details) | 9 Months Ended |
Sep. 30, 2017shares | |
Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 713,238 |
Restricted Stock Units (RSUs) | Vesting based on Service Condition | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 338,968 |
Restricted Stock Units (RSUs) | Vesting based on on Service and Market Condition | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 187,135 |
Restricted Stock Units (RSUs) | Vesting based on Service and Performance Condition | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 187,135 |
Cash Unit | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 375,658 |
Cash Unit | Vesting based on Service Condition | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 157,880 |
Cash Unit | Vesting based on on Service and Market Condition | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 108,889 |
Cash Unit | Vesting based on Service and Performance Condition | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (units) | 108,889 |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summary of Restricted Stock Unit Activity (Detail) - Restricted Stock Units (RSUs) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Period for recognition of unamortized compensation expense | 3 years | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Balance beginning of period (units) | 700,500 | |
Granted (units) | 713,238 | |
Vested (units) | (246,724) | |
Forfeited (units) | (44,870) | |
Balance end of period (units) | 1,122,144 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ||
Weighted Average Grant Date Fair Value, beginning of period (in USD per share) | $ 15.91 | |
Weighted Average Grant Date Fair Value, Granted (in USD per share) | 3.94 | |
Weighted Average Grant Date Fair Value, Vested (in USD per share) | 18.34 | |
Weighted Average Grant Date Fair Value, Forfeited (in USD per share) | 8.31 | |
Weighted Average Grant Date Fair Value, end of period (in USD per share) | $ 8.80 | |
Unamortized Compensation Expense | $ 4,568 |
SHARE-BASED COMPENSATION - Cash
SHARE-BASED COMPENSATION - Cash Units (Details) - Cash Unit - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 0.3 | $ 0.2 | |
Accrued liability related to Cash Units | $ 0.1 | $ 0.4 |
EARNINGS PER SHARE - Antidiluti
EARNINGS PER SHARE - Antidilutive securities excluded from the computation of earnings per share (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Restricted stock units, stock options and SARs | ||||
Class of Stock [Line Items] | ||||
Shares excluded from diluted shares calculation | 1,201 | 853 | 1,201 | 853 |
SEGMENT INFORMATION - Summarize
SEGMENT INFORMATION - Summarized Financial Information by Segment (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)segments | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($) | ||
Segment Reporting Information [Line Items] | ||||||
Number of Reportable Segments | segments | 6 | |||||
Revenues | $ 358,011 | $ 371,772 | $ 1,020,772 | $ 1,085,223 | ||
Depreciation, depletion and amortization | 38,066 | 40,860 | 114,131 | 113,097 | ||
Operating income (loss) | 14,255 | 8,753 | (17,900) | 15,489 | ||
Total assets | 1,434,512 | 1,606,054 | 1,434,512 | 1,606,054 | $ 1,584,909 | |
Capital expenditures | 12,261 | 18,388 | 25,365 | 30,619 | ||
Coal - U.S. Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | 142,040 | 170,177 | 420,445 | 478,684 | ||
Depreciation, depletion and amortization | 19,826 | 22,221 | 58,469 | 51,913 | ||
Operating income (loss) | 7,212 | 9,220 | 4,926 | 17,474 | ||
Total assets | 547,053 | 657,276 | 547,053 | 657,276 | ||
Capital expenditures | 5,348 | 4,824 | 9,204 | 12,038 | ||
Coal - Canada Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | 115,688 | 96,252 | 314,051 | 299,336 | ||
Depreciation, depletion and amortization | 8,590 | 7,133 | 25,627 | 19,932 | ||
Operating income (loss) | 1,206 | 5,226 | (17,632) | 20,919 | ||
Total assets | 444,058 | 503,460 | 444,058 | 503,460 | ||
Capital expenditures | 3,386 | 11,313 | 7,436 | 13,801 | ||
Coal - WMLP Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | [1] | 85,607 | 90,320 | 241,464 | 263,269 | |
Depreciation, depletion and amortization | [1] | 9,691 | 11,555 | 30,152 | 41,367 | |
Operating income (loss) | [1] | 9,451 | 5,970 | 18,321 | 2,497 | |
Total assets | [1] | 367,348 | 382,098 | 367,348 | 382,098 | |
Capital expenditures | [1] | 3,527 | 2,251 | 8,725 | 4,780 | |
Power Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | 20,070 | 21,554 | 61,177 | 65,494 | ||
Depreciation, depletion and amortization | 0 | 0 | 0 | 0 | ||
Operating income (loss) | 5,344 | (4,696) | 4,208 | (3,766) | ||
Total assets | 58,788 | 40,760 | 58,788 | 40,760 | ||
Capital expenditures | 0 | 0 | 0 | 0 | ||
Heritage Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | 0 | 0 | 0 | 0 | ||
Depreciation, depletion and amortization | 0 | 0 | 0 | 0 | ||
Operating income (loss) | (3,599) | (3,326) | (11,055) | (10,325) | ||
Total assets | 16,726 | 16,288 | 16,726 | 16,288 | ||
Capital expenditures | 0 | 0 | 0 | 0 | ||
Corporate and Eliminations | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenues | [1] | (5,394) | (6,531) | (16,365) | (21,560) | |
Depreciation, depletion and amortization | [1] | (41) | (49) | (117) | (115) | |
Operating income (loss) | [1] | (5,359) | (3,641) | (16,668) | (11,310) | |
Total assets | [1] | 539 | 6,172 | 539 | 6,172 | |
Capital expenditures | [1] | $ 0 | $ 0 | $ 0 | $ 0 | |
[1] | The Coal - WMLP segment recorded revenues of $5.4 million and $16.4 million for intersegment revenues to the Coal - U.S. segment for the three and nine months ended September 30, 2017, respectively, and $6.5 million and $21.6 million for the three and nine months ended September 30, 2016, respectively. Eliminations for intersegment revenues and cost of sales are presented within the Corporate segment. |
CONTINGENCIES Contingencies (De
CONTINGENCIES Contingencies (Details) $ in Millions | Sep. 30, 2017USD ($) |
Other current liabilities | |
Loss Contingencies [Line Items] | |
Remediation obligation | $ 2.4 |
SUBSEQUENT EVENTS Sell price of
SUBSEQUENT EVENTS Sell price of ROVA (Details) - USD ($) $ in Thousands | Oct. 01, 2017 | Dec. 31, 2017 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Aug. 02, 2017 |
Subsequent Event [Line Items] | |||||||
ROVA revenue to be recognized | $ 358,011 | $ 371,772 | $ 1,020,772 | $ 1,085,223 | |||
Sale price for assets of ROVA | $ 5,000 | ||||||
Mine reclamation liability | $ 2,700 | ||||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Settlement payment for release from ROVA power purchase and sale contracts | $ 10,100 | ||||||
Proceeds net of settlement payments from posted collateral | $ 6,200 | ||||||
Forecast | |||||||
Subsequent Event [Line Items] | |||||||
Loss on ROVA contract termination | $ 4,600 | ||||||
ROVA revenue to be recognized | 14,400 | ||||||
Revolving line of credit | Revolving line of credit | Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Letters of credit released | $ 7,500 |