Alliance Resource Partners LP :ARLP-US: Earnings Analysis: 2016 By the Numbers : January 31, 2017

Alliance Resource Partners LP reports financial results for the year ended December 31, 2016.

Highlights

  • Gross margins narrowed from 23.27% to 22.70% compared to the same period last year, operating (EBITDA) margins now 35.64% from 35.12%.
  • Earnings growth due to contribution of one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

2016 2015 2014 2013 2012
Relevant Numbers (Annual)
Revenues 1931.45 2273.73 2300.72 2205.56 2034.3
Revenue Growth (YOY) N/A N/A N/A N/A N/A
Earnings 258.77 156.37 353.33 268.43 228.73
Earnings Growth (YOY) 65.49 -55.74 31.63 17.35 -23.44
Net Margin 13.4 6.88 15.36 12.17 11.24
EPS 3.39 2.11 4.77 3.63 3.06
Return on Equity 24.85 15.6 37.86 34.49 33.96
Return on Assets 11.36 6.73 16.04 13.17 12.41

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Earnings Growth Analysis

The company’s gross margins showed no year-on-year improvement. In spite of this, the company’s earnings rose, influenced primarily by the improvement in operating margins (EBITDA margins) from 35.12% to 35.64%. For comparison, gross margins were 23.27% and EBITDA margins were 35.12% in the last period.

Margins

The company’s operating (EBIT) margins contracted from 20.30% to 18.95%. In spite of this, the company’s earnings rose. This was influenced primarily by one-time items, which improved pretax margins from 13.47% to 17.58%.

EBIT Margin History
PreTax Margin History

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Company Profile

Alliance Resource Partners LP produces and markets coal to United States utilities and industrial users. It operates through the following segments: Illinois Basin, Appalachia, and Other and Corporate. The Illinois Basin segment is comprised of Webster County coal’s Dotiki mining complex, Gibson mining complex, which includes the Gibson north mine and the Gibson south project, Hopkins County coal’s Elk Creek mining complex, White County coal’s Pattiki mining complex, Warrior’s mining complex, River View’s mining complex, the Sebree property and certain properties of Alliance Resource Properties and ARP Sebree LLC. The Appalachian segment is composed of Pontiki and MC Mining complexes. The Other and Corporate segment includes marketing and administrative expenses, Mt. Vernon dock activities, coal brokerage activity, its equity investment in Mid-America Carbonates LLC and certain activities of Alliance Resource Properties. The company was founded in May 1999 and is headquartered in Tulsa, OK.

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