x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
¨
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Delaware
|
95-0740960
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification Number)
|
4
North 4th Street, Richmond, Virginia
|
23219
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Title
of each class
|
Name
of each exchange on which registered
|
Common
Stock, $0.625 par value
|
New
York Stock Exchange
|
(i)
|
our
cash flows, results of operation or financial
condition;
|
|
(ii)
|
the
successful completion of acquisition, disposition or financing
transactions and the effect thereof on our business;
|
|
(iii)
|
governmental
policies, laws, regulatory actions and court decisions affecting the coal
industry or our customers’ coal usage;
|
|
(iv)
|
legal
and administrative proceedings, settlements, investigations and claims and
the availability of insurance coverage related thereto;
|
|
(v)
|
inherent
risks of coal mining beyond our control, including weather and geologic
conditions or catastrophic weather-related damage;
|
|
(vi)
|
our
production capabilities to meet market expectations and customer
requirements;
|
|
(vii)
|
our
ability to obtain coal from brokerage sources or contract miners in
accordance with their contracts;
|
|
(viii)
|
our
ability to obtain and renew permits necessary for our existing and planned
operations in a timely manner;
|
|
(ix)
|
the
cost and availability of transportation for our produced
coal;
|
|
(x)
|
our
ability to expand our mining capacity;
|
|
(xi)
|
our
ability to manage production costs, including labor
costs;
|
|
(xii)
|
adjustments
made in price, volume or terms to existing coal supply
agreements;
|
|
(xiii)
|
the
worldwide market demand for coal, electricity and
steel;
|
|
(xiv)
|
environmental
concerns related to coal mining and combustion and the cost and perceived
benefits of alternative sources of energy such as natural gas and nuclear
energy;
|
|
(xv)
|
competition
among coal and other energy producers, in the United States and
internationally;
|
|
(xvi)
|
our
ability to timely obtain necessary supplies and
equipment;
|
|
(xvii)
|
our
reliance upon and relationships with our customers and
suppliers;
|
|
(xviii)
|
the
creditworthiness of our customers and suppliers;
|
|
(xix)
|
our
ability to attract, train and retain a skilled workforce to meet
replacement or expansion needs;
|
|
(xx)
|
our
assumptions and projections concerning economically recoverable coal
reserve estimates;
|
|
(xxi)
|
our
failure to enter into anticipated new contracts;
|
|
(xxii)
|
future
economic or capital market conditions;
|
|
(xxiii)
|
foreign
currency fluctuations;
|
|
(xxiv)
|
the
availability and costs of credit, surety bonds and letters of credit that
we require;
|
|
(xxv)
|
the
lack of insurance against all potential operating
risks;
|
|
(xxvi)
|
our
assumptions and projections regarding pension and other post-retirement
benefit liabilities;
|
|
(xxvii)
|
our
interpretation and application of accounting literature related to mining
specific issues; and
|
|
(xxviii)
|
the
successful implementation of our strategic plans and objectives for future
operations and expansion or
consolidation.
|
Page
|
||
PART I
|
||
Item
1.
|
Business
|
1
|
Item
1A.
|
Risk
Factors
|
22
|
Item
1B.
|
Unresolved
Staff Comments
|
31
|
Item
2.
|
Properties
|
32
|
Item
3.
|
Legal
Proceedings
|
32
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
33
|
PART
II
|
||
Item
5.
|
Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
|
34
|
Item
6.
|
Selected
Financial Data
|
36
|
Item
7.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
38
|
Item
7A.
|
Quantitative
and Qualitative Disclosures about Market Risk
|
53
|
Item
8.
|
Financial
Statements and Supplementary Data
|
55
|
Item
9.
|
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
|
95
|
Item
9A.
|
Controls
and Procedures
|
95
|
Item
9B.
|
Other
Information
|
96
|
PART III
|
||
Item
10.
|
Directors,
Executive Officers and Corporate Governance
|
97
|
Item
11.
|
Executive
Compensation
|
99
|
Item
12.
|
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
|
99
|
Item
13.
|
Certain
Relationships and Related Transactions, and Director
Independence
|
99
|
Item
14.
|
Principal
Accountant Fees and Services
|
99
|
PART IV
|
||
Item
15.
|
Exhibits
and Financial Statement Schedules
|
100
|
SIGNATURES
|
104
|
·
|
Produced
coal revenues increased by 25% from $2.1 billion in 2007 to $2.6 billion
in 2008 on produced coal sales of 41.0 million
tons.
|
·
|
Reserve
base of approximately 2.3 billion tons at December 31,
2008.
|
Region
|
% of Total
|
|
Powder
River Basin
|
46%
|
|
Central
Appalachia
|
20%
|
|
West
(other than Powder River Basin)
|
11%
|
|
Northern
Appalachia
|
11%
|
|
Midwest
|
9%
|
|
All
other
|
3%
|
|
Total
|
100%
|
|
End
Use
|
% of Total
|
|
Electric
Power
|
93%
|
|
Other
Industrial
|
5%
|
|
Coke
|
2%
|
|
Residential
and Commercial
|
<1%
|
|
Total
|
100%
|
|
Electricity
Generation Source
|
Average Cost
per million BTU
|
|
Petroleum
Liquids
|
$ 16.56
|
|
Natural
Gas
|
$ 9.34
|
|
Coal
|
$ 2.06
|
|
Petroleum Coke |
$ 1.85
|
Electricity
Generation Source
|
%
of Total
Electricity Generation
|
|
Coal
|
49%
|
|
Natural
Gas
|
21%
|
|
Nuclear
|
19%
|
|
Hydroelectric
|
6%
|
|
Oil
and other (solar, wind, etc.)
|
5%
|
|
Total
|
100%
|
|
Resource
Group Name
|
Location
(County)
|
Active/
Inactive
|
Mine
Type
|
Active Mine Count (1)
|
Mining
Equipment
|
Transportation
|
2008 Production (2)
|
2008 Shipments (3)
|
Year
Established or Acquired
|
|||||||||||||
(Thousands
of Tons)
|
||||||||||||||||||||||
West
Virgina Resource Groups
|
||||||||||||||||||||||
Black
Castle
|
Boone
|
Active
|
S
|
1
|
HW
|
truck,
barge
|
3,110 | 1,908 |
1987
|
|||||||||||||
Delbarton
|
Mingo
|
Active
|
U
|
1
|
NS
|
527 | 776 |
1999
|
||||||||||||||
Edwight
|
Raleigh
|
Active
|
S
|
1
|
HW
|
CSX
|
1,752 | - |
2003
|
|||||||||||||
Elk
Run
|
Boone
|
Active
|
U
|
5
|
LW
|
CSX
|
2,201 | 2,796 |
1978
|
|||||||||||||
Endurance
|
Boone
|
Active
|
S
|
1
|
HW
|
CSX
|
1,127 | 659 |
2001
|
|||||||||||||
Green
Valley
|
Nicholas
|
Active
|
U
|
3
|
CSX
|
727 | 641 |
1996
|
||||||||||||||
Guyandotte
|
Wyoming
|
Active
|
U
|
1
|
NS
|
146 | 110 |
2006
|
||||||||||||||
Independence
|
Boone
|
Active
|
U
|
3
|
LW
|
CSX
|
1,833 | 3,420 |
1994
|
|||||||||||||
Inman
|
Boone
|
Active
|
U
|
1
|
CSX
|
280 | - |
2008
|
||||||||||||||
Logan
County
|
Logan
|
Active
|
S/U
|
9
|
HW
|
CSX
|
4,651 | 4,458 |
1998
|
|||||||||||||
Mammoth
|
Kanawha
|
Active
|
U
|
4
|
barge
|
1,233 | 2,616 |
2004
|
||||||||||||||
Marfork
|
Raleigh
|
Active
|
U
|
8
|
CSX
|
4,043 | 6,881 |
1993
|
||||||||||||||
Nicholas
Energy
|
Nicholas
|
Active
|
S/U
|
3
|
HW
|
NS
|
3,251 | 3,081 |
1997
|
|||||||||||||
Progress
|
Boone
|
Active
|
S
|
1
|
DL
|
CSX
|
5,170 | 4,177 |
1998
|
|||||||||||||
Rawl
|
Mingo
|
Active
|
U
|
3
|
NS
|
1,000 | 437 |
1974
|
||||||||||||||
Republic
Energy
|
Raleigh
|
Active
|
S
|
2
|
truck
|
2,617 | 1,210 |
2004
|
||||||||||||||
Stirrat
|
Logan
|
Active
|
S
|
1
|
CSX
|
1,520 | 1,463 |
1993
|
||||||||||||||
|
||||||||||||||||||||||
Kentucky
Resource Groups
|
||||||||||||||||||||||
Coalgood
Energy
|
Harlan
|
Active
|
S/U
|
2
|
HW
|
CSX
|
9 | - |
2005
|
|||||||||||||
Long
Fork
|
Pike
|
Active
|
NS
|
- | 1,854 |
1991
|
||||||||||||||||
Martin
County
|
Martin
|
Active
|
S/U
|
4
|
NS
|
419 | 236 |
1969
|
||||||||||||||
New
Ridge
|
Pike
|
Active
|
CSX
|
- | 261 |
1992
|
||||||||||||||||
Sidney
|
Pike
|
Active
|
S/U
|
10
|
HW
|
NS
|
4,950 | 3,443 |
1984
|
|||||||||||||
Virginia
Resource Group
|
||||||||||||||||||||||
Knox
Creek
|
Tazewell
|
Active
|
S/U
|
2
|
HW
|
NS
|
577 | 536 |
1997
|
|||||||||||||
Total
|
66
|
41,143 | 40,963 |
(1)
|
Active
mine count as of January 31, 2009.
|
(2)
|
For
purposes of this table, coal production has been allocated to the Resource
Group where the coal is mined, rather than the Resource Group where the
coal is processed and shipped. Production amounts above represent coal
extracted from the ground.
|
(3)
|
For
purposes of this table, coal shipments have been allocated to the Resource
Group from where the coal is processed and shipped, rather than the
Resource Group where the coal is
mined.
|
|
S –
surface mine
|
|
U –
underground mine
|
|
HW
– highwall miners operated in conjunction with surface
mines
|
|
LW –
longwall mine
|
|
DL –
dragline
|
|
NS –
Norfolk Southern Railway Company
|
|
CSX
– CSX Transportation
|
|
Kentucky
Resource Groups
|
|
Virginia
Resource Group
|
Recoverable Reserves (1)
|
|||||||||||||||||||||||||||||
Resource
Group
|
Location (2)
|
Total
|
Proven
|
Probable
|
Assigned (3)
|
Unassigned (3)
|
Owned
|
Leased
|
|||||||||||||||||||||
(In
Thousands of Tons)
|
|||||||||||||||||||||||||||||
West
Virginia
|
|||||||||||||||||||||||||||||
Black Castle
|
Boone
County
|
86,132 | 59,402 | 26,730 | 39,362 | 46,770 | 538 | 85,594 | |||||||||||||||||||||
Delbarton
|
Mingo
County
|
286,237 | 120,440 | 165,797 | 140,739 | 145,498 | 25 | 286,212 | |||||||||||||||||||||
Edwight
|
Raleigh
County
|
7,796 | 7,796 | - | 7,796 | - | - | 7,796 | |||||||||||||||||||||
Elk
Run
|
Boone
County
|
108,782 | 75,615 | 33,167 | 59,488 | 49,294 | 4,660 | 104,122 | |||||||||||||||||||||
Endurance
|
Boone
County
|
23,007 | 23,007 | - | 23,007 | - | 22,602 | 405 | |||||||||||||||||||||
Green Valley
|
Nicholas
County
|
9,973 | 9,973 | - | 9,973 | - | - | 9,973 | |||||||||||||||||||||
Guyandotte
|
Wyoming
County
|
45,564 | 17,366 | 28,198 | 2,100 | 43,464 | 330 | 45,234 | |||||||||||||||||||||
Independence
|
Boone
County
|
44,466 | 43,156 | 1,310 | 31,487 | 12,979 | 9,482 | 34,984 | |||||||||||||||||||||
Inman
|
Boone
County
|
49,473 | 47,958 | 1,515 | 17,066 | 32,407 | - | 49,473 | |||||||||||||||||||||
Logan County
|
Logan
County
|
72,805 | 65,721 | 7,084 | 55,081 | 17,724 | 2,388 | 70,417 | |||||||||||||||||||||
Mammoth
|
Kanawha
County
|
86,425 | 66,086 | 20,339 | 73,108 | 13,317 | 42,421 | 44,004 | |||||||||||||||||||||
Marfork
|
Raleigh
County
|
133,399 | 105,262 | 28,137 | 74,976 | 58,423 | 815 | 132,584 | |||||||||||||||||||||
Nicholas
Energy
|
Nicholas
County
|
88,795 | 48,186 | 40,609 | 46,379 | 42,416 | 35,517 | 53,278 | |||||||||||||||||||||
Progress
|
Boone
County
|
17,262 | 17,262 | - | 17,262 | - | - | 17,262 | |||||||||||||||||||||
Rawl
|
Mingo
County
|
108,849 | 81,087 | 27,762 | 74,852 | 33,997 | 1,333 | 107,516 | |||||||||||||||||||||
Republic
Energy
|
Raleigh
County
|
56,208 | 49,688 | 6,520 | 56,208 | - | - | 56,208 | |||||||||||||||||||||
Stirrat
|
Logan
County
|
11,745 | 7,778 | 3,967 | 5,078 | 6,667 | - | 11,745 | |||||||||||||||||||||
Kentucky
|
|||||||||||||||||||||||||||||
Coalgood
Energy
|
Harlan
County
|
21,261 | 12,357 | 8,904 | - | 21,261 | 2,704 | 18,557 | |||||||||||||||||||||
Long
Fork
|
Pike
County
|
4,964 | 2,764 | 2,200 | 264 | 4,700 | - | 4,964 | |||||||||||||||||||||
Martin County
|
Martin
County
|
48,181 | 31,492 | 16,689 | 2,783 | 45,398 | 1,336 | 46,845 | |||||||||||||||||||||
New
Ridge
|
Pike
County
|
- | - | - | - | - | - | - | |||||||||||||||||||||
Sidney
|
Pike
County
|
124,211 | 70,173 | 54,038 | 124,211 | - | 7,028 | 117,183 | |||||||||||||||||||||
Virginia
|
|||||||||||||||||||||||||||||
Knox
Creek
|
Tazewell
County
|
60,675 | 44,586 | 16,089 | 32,605 | 28,070 | 4,552 | 56,123 | |||||||||||||||||||||
Subtotal
|
1,496,210 | 1,007,155 | 489,055 | 893,825 | 602,385 | 135,731 | 1,360,479 | ||||||||||||||||||||||
Land Management Companies: (4)
|
|||||||||||||||||||||||||||||
Black
King
|
Boone
County, WV
|
53,144 | 40,762 | 12,382 | 734 | 52,410 | - | 53,144 | |||||||||||||||||||||
Raleigh
County, WV
|
|||||||||||||||||||||||||||||
Boone
East
|
Boone
County, WV
|
141,976 | 102,853 | 39,123 | 5,169 | 136,807 | 63,547 | 78,429 | |||||||||||||||||||||
Kanawha
County, WV
|
|||||||||||||||||||||||||||||
Boone
West
|
Lincoln
County, WV
|
242,308 | 92,201 | 150,107 | 10,496 | 231,812 | 65,553 | 176,755 | |||||||||||||||||||||
Logan
County, WV
|
|||||||||||||||||||||||||||||
Ceres Land
|
Raleigh
County, WV
|
33,351 | 24,220 | 9,131 | - | 33,351 | - | 33,351 | |||||||||||||||||||||
Rostraver Energy (5)
|
Various
counties, PA
|
94,086 | 44,449 | 49,637 | - | 94,086 | 79,907 | 14,179 | |||||||||||||||||||||
Lauren
Land
|
Mingo
County, WV
|
167,671 | 107,301 | 60,370 | 11,175 | 156,496 | 18,011 | 149,660 | |||||||||||||||||||||
Logan
County, WV
|
|||||||||||||||||||||||||||||
Various
counties, KY
|
|||||||||||||||||||||||||||||
New
Market Land
|
Wyoming
County, WV
|
5,884 | 2,690 | 3,194 | - | 5,884 | 102 | 5,782 | |||||||||||||||||||||
Raven
Resources
|
Raleigh
County, WV
|
18,978 | 18,978 | - | - | 18,978 | - | 18,978 | |||||||||||||||||||||
Boone
County, WV
|
|||||||||||||||||||||||||||||
Tennessee
Consolidated Coal
|
Various
counties, TN
|
26,907 | 1,332 | 25,575 | - | 26,907 | 24,054 | 2,853 | |||||||||||||||||||||
Subtotal
Land Management
|
784,305 | 434,786 | 349,519 | 27,574 | 756,731 | 251,174 | 533,131 | ||||||||||||||||||||||
Other
|
N/A
|
57,733 | 29,680 | 28,053 | 12,740 | 44,993 | 3,112 | 54,621 | |||||||||||||||||||||
Total
|
2,338,248 | 1,471,621 | 866,627 | 934,139 | 1,404,109 | 390,017 | 1,948,231 |
(1)
|
Recoverable
reserves represent the amount of proven and probable reserves that can
actually be recovered from the reserve base taking into account all mining
and preparation losses involved in producing a saleable product using
existing methods under current law.
|
(2)
|
All
of the recoverable reserves listed are in Central Appalachia, except for
the Rostraver reserves, which are located in Northern Appalachia and
Lauren Land reserves, a portion of which are located in the Illinois
Basin. The reserve numbers of each Resource Group contain a moisture
factor specific to the particular reserves of that Resource Group. The
moisture factor represents the average moisture present in our delivered
coal.
|
(3)
|
Assigned
Reserves represent recoverable reserves that are dedicated to a specific
permitted mine; otherwise, the reserves are considered Unassigned. For
Land Management Companies, Assigned Reserves have been leased to a
third-party and are dedicated to a specific permitted mine of the
lessee.
|
(4)
|
Land
management companies are our subsidiaries whose primary purposes are to
acquire and hold our reserves.
|
(5)
|
Previously
known as Duncan Fork.
|
The
categorization of the “quality” (i.e., sulfur content, Btu, coal type,
etc.) of coal reserves is as
follows:
|
Recoverable Reserves (1)
|
||||||||||||||||||||||||
Recoverable
|
Sulfur
Content
|
Avg.
Btu as
|
||||||||||||||||||||||
Resource
Group
|
Reserves
|
+1% (2)
|
-1% (2)
|
Compliance (2)
|
Received (3)
|
Coal Type (4)
|
||||||||||||||||||
(In
Thousands of Tons Except Average Btu as Received)
|
||||||||||||||||||||||||
West
Virginia
|
||||||||||||||||||||||||
Black Castle
|
86,132 | 34,116 | 52,016 | 22,167 | 12,700 |
Utility
and Industrial
|
||||||||||||||||||
Delbarton
|
286,237 | 111,954 | 174,283 | 127,073 | 13,350 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Edwight
|
7,796 | 1,622 | 6,174 | 5,987 | 12,550 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Elk
Run
|
108,782 | 47,027 | 61,755 | 51,407 | 13,700 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Endurance
|
23,007 | 4,952 | 18,055 | 10,047 | 11,850 |
Utility
and Industrial
|
||||||||||||||||||
Green Valley
|
9,973 | 471 | 9,502 | 3,853 | 13,100 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Guyandotte
|
45,564 | - | 45,564 | 45,564 | 13,850 |
Low
Vol Met
|
||||||||||||||||||
Independence
|
44,466 | 19,425 | 25,041 | - | 12,650 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Inman
|
49,473 | 32,667 | 16,806 | 16,895 | 12,650 |
High
Vol Met and Utility
|
||||||||||||||||||
Logan County
|
72,805 | 22,346 | 50,459 | 39,009 | 12,050 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Mammoth
|
86,425 | 5,216 | 81,209 | 41,706 | 12,150 |
Utility
and Industrial
|
||||||||||||||||||
Marfork
|
133,399 | 41,679 | 91,720 | 34,931 | 14,050 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Nicholas
Energy
|
88,795 | 39,959 | 48,836 | 24,705 | 12,450 |
Utility
and Industrial
|
||||||||||||||||||
Progress
|
17,262 | 6,021 | 11,241 | 11,241 | 12,350 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Rawl
|
108,849 | 28,061 | 80,788 | 59,614 | 12,350 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Republic
|
56,208 | 11,014 | 45,194 | 31,238 | 12,450 |
High
Vol Met and Utility
|
||||||||||||||||||
Stirrat
|
11,745 | 223 | 11,522 | 7,663 | 12,300 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Kentucky
|
||||||||||||||||||||||||
Coalgood
Energy
|
21,261 | 4,712 | 16,549 | 11,680 | 13,100 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Long
Fork
|
4,964 | 3,500 | 1,464 | - | 12,850 |
Utility
and Industrial
|
||||||||||||||||||
Martin County
|
48,181 | 33,900 | 14,281 | 5,120 | 12,500 |
Utility
and Industrial
|
||||||||||||||||||
New
Ridge
|
- | - | - | - | - | N/A | ||||||||||||||||||
Sidney
|
124,211 | 47,878 | 76,333 | 52,545 | 13,200 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Virginia
|
||||||||||||||||||||||||
Knox
Creek
|
60,675 | 7,022 | 53,653 | 40,250 | 12,350 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Subtotal
|
1,496,210 | 503,765 | 992,445 | 642,695 | ||||||||||||||||||||
Land Management Companies: (5)
|
||||||||||||||||||||||||
Black
King
|
53,144 | 99 | 53,045 | 36,508 | 12,150 |
High
Vol Met and Utility
|
||||||||||||||||||
Boone
East
|
141,976 | 34,939 | 107,037 | 36,789 | 12,500 |
High
Vol Met, Utility, and Low Vol Met
|
||||||||||||||||||
Boone
West
|
242,308 | 130,063 | 112,245 | 79,369 | 13,350 |
High
Vol Met and Utility
|
||||||||||||||||||
Ceres Land
|
33,351 | 5,991 | 27,360 | 12,740 | 12,700 |
High
Vol Met and Utility
|
||||||||||||||||||
Rostraver Energy
(6)
|
94,086 | 94,086 | - | - | 14,050 |
High
Vol Met, Utility, and Industrial
|
||||||||||||||||||
Lauren
Land
|
167,671 | 85,346 | 82,325 | 62,628 | 12,700 |
High
Vol Met and Utility
|
||||||||||||||||||
New
Market Land
|
5,884 | - | 5,884 | 5,884 | 12,700 |
High
Vol Met and Low Vol Met
|
||||||||||||||||||
Raven
Resources
|
18,978 | 7,449 | 11,529 | 1,369 | 12,100 |
High
Vol Met and Utility
|
||||||||||||||||||
Tennessee
Consolidated Coal
|
26,907 | 20,353 | 6,554 | 4,816 | 13,000 |
High
Vol Met, Utility and Industrial
|
||||||||||||||||||
Subtotal
Land Management
|
784,305 | 378,326 | 405,979 | 240,103 | ||||||||||||||||||||
Other
|
57,733 | 6,638 | 51,095 | 45,947 | 12,800 |
Various
|
||||||||||||||||||
Total
|
2,338,248 | 888,729 | 1,449,519 | 928,745 |
(1)
|
The
reserve numbers of each Resource Group contain a moisture factor specific
to the particular reserves of that Resource Group. The moisture factor
represents the average moisture present in our delivered
coal.
|
(2)
|
+1%
or -1% refers to sulfur content as a percentage in coal by weight.
Compliance coal is less than 1% sulfur content by weight and is included
in the -1% column.
|
(3)
|
Represents
an estimate of the average Btu per pound present in our coal, as it is
received by the customer.
|
(4)
|
Reserve
holdings include metallurgical coal reserves. Although these metallurgical
coal reserves receive the highest selling price in the current coal market
when marketed to steel-making customers, they can also be marketed as an
ultra high Btu, low sulfur utility coal for electricity
generation.
|
(5)
|
Land
management companies are our subsidiaries whose primary purposes are to
acquire and hold our reserves.
|
(6)
|
Previously
known as Duncan Fork.
|
Compliance
compared to non-compliance coal
|
§
|
uncertainties
in assessing the value, strengths and potential profitability of, and
identifying the extent of all weaknesses, risks, contingent and other
liabilities (including environmental liabilities) of, acquisition or other
transaction candidates;
|
§
|
the
potential loss of key customers, management and employees of an acquired
business;
|
§
|
the
ability to achieve identified operating and financial synergies
anticipated to result from an acquisition or other
transaction;
|
§
|
problems
that could arise from the integration of the acquired
business;
|
§
|
the
risk of obtaining mining permits for acquired coal assets;
and
|
§
|
unanticipated
changes in business, industry or general economic conditions that affect
the assumptions underlying the acquisition or other transaction
rationale.
|
Richmond,
Virginia
|
Owned
|
Massey
Corporate Headquarters
|
Julian,
West Virginia
|
Owned
|
Massey
Operational Headquarters
|
High
|
Low
|
Dividends
|
||||||||||
Fiscal
Year 2007
|
||||||||||||
Quarter
ended March 31, 2007
|
$ | 26.35 | $ | 21.55 | $ | 0.04 | ||||||
Quarter
ended June 30, 2007
|
$ | 30.73 | $ | 23.97 | $ | 0.04 | ||||||
Quarter
ended September 30, 2007
|
$ | 26.80 | $ | 16.01 | $ | 0.04 | ||||||
Quarter
ended December 31, 2007
|
$ | 37.99 | $ | 21.49 | $ | 0.05 | ||||||
Fiscal
Year 2008
|
||||||||||||
Quarter
ended March 31, 2008
|
$ | 44.00 | $ | 26.22 | $ | 0.05 | ||||||
Quarter
ended June 30, 2008
|
$ | 95.70 | $ | 35.33 | $ | 0.05 | ||||||
Quarter
ended September 30, 2008
|
$ | 94.09 | $ | 31.15 | $ | 0.05 | ||||||
Quarter
ended December 31, 2008
|
$ | 35.00 | $ | 10.05 | $ | 0.06 |
Year
Ended December 31,
|
||||||||||||||||||||
2008
|
2007
|
2006
|
2005
|
2004
|
||||||||||||||||
(In
millions, except per share, per ton, and number of employees
amounts)
|
||||||||||||||||||||
CONSOLIDATED
STATEMENT OF INCOME DATA:
|
||||||||||||||||||||
Produced
coal revenue
|
$ | 2,559.9 | $ | 2,054.4 | $ | 1,902.3 | $ | 1,777.7 | $ | 1,456.7 | ||||||||||
Total
revenue
|
2,989.8 | 2,413.5 | 2,219.9 | 2,204.3 | 1,766.6 | |||||||||||||||
Income
(Loss) before interest and income taxes
|
133.2 | 179.7 | 111.0 | (20.9 | ) | 46.2 | ||||||||||||||
Income
(Loss) before cumulative effect of accounting change
|
56.2 | 94.1 | 41.6 | (101.6 | ) | 13.9 | ||||||||||||||
Net
income (loss)
|
56.2 | 94.1 | 41.0 | (101.6 | ) | 13.9 | ||||||||||||||
Income
(Loss) per share - Basic (1)
|
||||||||||||||||||||
Income
(Loss) before cumulative effect of accounting change
|
$ | 0.69 | $ | 1.17 | $ | 0.51 | $ | (1.33 | ) | $ | 0.18 | |||||||||
Net
income (loss)
|
$ | 0.69 | $ | 1.17 | $ | 0.50 | $ | (1.33 | ) | $ | 0.18 | |||||||||
Income
(Loss) per share - Diluted (1)
|
||||||||||||||||||||
Income
(Loss) before cumulative effect of accounting change
|
$ | 0.68 | $ | 1.17 | $ | 0.51 | $ | (1.33 | ) | $ | 0.18 | |||||||||
Net
income (loss)
|
$ | 0.68 | $ | 1.17 | $ | 0.50 | $ | (1.33 | ) | $ | 0.18 | |||||||||
Dividends
declared per share
|
$ | 0.21 | $ | 0.17 | $ | 0.16 | $ | 0.16 | $ | 0.16 | ||||||||||
CONSOLIDATED
BALANCE SHEET DATA:
|
||||||||||||||||||||
Working
capital
|
$ | 731.3 | $ | 522.6 | $ | 445.2 | $ | 670.8 | $ | 458.4 | ||||||||||
Total
assets
|
3,675.8 | 2,860.7 | 2,740.7 | 2,986.5 | 2,650.9 | |||||||||||||||
Long-term
debt
|
1,463.6 | 1,102.7 | 1,102.3 | 1,102.6 | 900.2 | |||||||||||||||
Shareholders'
equity (2)
|
1,036.6 | 784.0 | 697.3 | 841.0 | 776.9 | |||||||||||||||
OTHER
DATA:
|
||||||||||||||||||||
EBIT
(3)
|
$ | 133.2 | $ | 179.7 | $ | 111.0 | $ | (20.9 | ) | $ | 46.2 | |||||||||
EBITDA
(3)
|
$ | 390.6 | $ | 425.7 | $ | 341.5 | $ | 213.6 | $ | 270.8 | ||||||||||
Average
cash cost per ton sold (4)
|
$ | 48.53 | $ | 43.10 | $ | 42.33 | $ | 35.62 | $ | 30.50 | ||||||||||
Produced
coal revenue per ton sold
|
$ | 62.50 | $ | 51.55 | $ | 48.71 | $ | 42.02 | $ | 36.02 | ||||||||||
Capital
expenditures
|
$ | 736.5 | $ | 270.5 | $ | 298.1 | $ | 346.6 | $ | 347.2 | ||||||||||
Produced
tons sold
|
41.0 | 39.9 | 39.1 | 42.3 | 40.4 | |||||||||||||||
Tons
produced
|
41.1 | 39.5 | 38.6 | 43.1 | 42.0 | |||||||||||||||
Number
of employees
|
6,743 | 5,407 | 5,517 | 5,709 | 5,034 |
(1)
|
In
accordance with accounting principles generally accepted in the United
States (“GAAP”), the effect of certain dilutive securities was excluded
from the calculation of the diluted income (loss) per common share for the
years ended December 31, 2008, 2007, 2006, 2005, and 2004, as such
inclusion would result in
antidilution.
|
(2)
|
Certain
accounting pronouncements adopted in 2007 and 2006 affect the
comparability of the 2007 and 2006 financial statements to prior years.
The adoption of FASB Interpretation No. 48, “Accounting for Uncertainty in
Income Taxes – an interpretation of FASB Statement No. 109” on January 1,
2007 increased equity by $5.2 million (see Note 7 to the Notes to
Consolidated Financial Statements for more information). The adoption of
Emerging Issues Task Force Issue No. 04-6, “Accounting for Stripping Costs
Incurred During Production in the Mining Industry” on January 1, 2006
decreased equity by $93.8 million and the adoption of SFAS No. 158,
“Employer’s Accounting for Defined Benefit Pension and Other
Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, and
132(R)” on December 31, 2006 decreased equity by $40.2 million (see Notes
5, 10 and 11 to the Notes to Consolidated Financial Statements for more
information).
|
(3)
|
EBIT
is defined as Income (Loss) before interest and taxes. EBITDA is defined
as Income (Loss) before interest and taxes before deducting Depreciation,
depletion, and amortization (“DD&A”). Although neither EBIT nor EBITDA
are measures of performance calculated in accordance with GAAP, we believe
that both measures are useful to an investor in evaluating us because they
are widely used in the coal industry as measures to evaluate a company’s
operating performance before debt expense and as a measure of its cash
flow. Neither EBIT nor EBITDA purport to represent operating income, net
income or cash generated by operating activities and should not be
considered in isolation or as a substitute for measures of performance
calculated in accordance with GAAP. In addition, because neither EBIT nor
EBITDA are calculated identically by all companies, the presentation here
may not be comparable to other similarly titled measures of other
companies. The table below reconciles the GAAP measure of Net income to
EBIT and to EBITDA.
|
Year
Ended December 31,
|
||||||||||||||||||||
2008
|
2007
|
2006
|
2005
|
2004
|
||||||||||||||||
(In
millions)
|
||||||||||||||||||||
Net
income (loss)
|
$ | 56.2 | $ | 94.1 | $ | 41.0 | $ | (101.6 | ) | $ | 13.9 | |||||||||
Cumulative
effect of accounting change, net of tax
|
- | - | 0.6 | - | - | |||||||||||||||
Income
tax expense( benefit)
|
4.1 | 35.4 | 3.4 | 26.2 | (19.5 | ) | ||||||||||||||
Net
interest
expense and loss on short-term investment
|
72.9 | 50.2 | 66.0 | 54.5 | 51.8 | |||||||||||||||
EBIT
|
133.2 | 179.7 | 111.0 | (20.9 | ) | 46.2 | ||||||||||||||
Depreciation,
depletion and amortization
|
257.4 | 246.0 | 230.5 | 234.5 | 224.6 | |||||||||||||||
EBITDA
|
$ | 390.6 | $ | 425.7 | $ | 341.5 | $ | 213.6 | $ | 270.8 |
(4)
|
Average
cash cost per ton is calculated as the sum of Cost of produced coal
revenue and Selling, general and administrative expense (“SG&A”)
(excluding DD&A), divided by the number of produced tons sold.
Although Average cash cost per ton is not a measure of performance
calculated in accordance with GAAP, we believe that it is useful to
investors in evaluating us because it is widely used in the coal industry
as a measure to evaluate a company’s control over its cash costs. Average
cash cost per ton should not be considered in isolation or as a substitute
for measures of performance in accordance with GAAP. In addition, because
Average cash cost per ton is not calculated identically by all companies,
the presentation here may not be comparable to other similarly titled
measures of other companies. The table below reconciles the GAAP measure
of Total costs and expenses to Average cash cost per
ton.
|
Year
Ended December 31,
|
|||||||||||||||||||||||||
2008
|
2007
|
2006
|
2005
|
2004
|
|||||||||||||||||||||
(In
millions, except per ton amounts)
|
|||||||||||||||||||||||||
$ |
per
ton
|
$ |
per
ton
|
$ |
per
ton
|
$ |
per
ton
|
$ |
per
ton
|
||||||||||||||||
Total
costs and expenses
|
$ | 2,856.6 | $ | 2,233.8 | $ | 2,108.8 | $ | 2,225.2 | $ | 1,720.4 | |||||||||||||||
Less:
Freight and handling costs
|
306.4 | 167.6 | 156.5 | 150.9 | 148.8 | ||||||||||||||||||||
Less:
Cost of purchased coal revenue
|
28.5 | 95.2 | 62.6 | 112.6 | 104.1 | ||||||||||||||||||||
Less:
Depreciation, depletion and amortization
|
257.4 | 246.0 | 230.5 | 234.5 | 224.6 | ||||||||||||||||||||
Less:
Other expense
|
3.2 | 7.3 | 6.2 | 8.0 | 9.5 | ||||||||||||||||||||
Less:
Litigation charge
|
250.1 | - | - | - | - | ||||||||||||||||||||
Less:
Loss on financing transactions
|
0.5 | - | - | 212.4 | - | ||||||||||||||||||||
Less:
Net change in fair value of derivative instruments
|
22.6 | - | - | - | - | ||||||||||||||||||||
Average
cash cost
|
$ | 1,987.9 |
$48.53
|
$ | 1,717.7 |
$43.10
|
$ | 1,653.0 |
$42.33
|
$ | 1,506.8 |
$35.62
|
$ | 1,233.4 |
$30.50
|
Year
Ended
|
||||||||||||||||
December
31,
|
||||||||||||||||
Increase
|
%
Increase
|
|||||||||||||||
(In
thousands)
|
2008
|
2007
|
(Decrease)
|
(Decrease)
|
||||||||||||
Revenues
|
||||||||||||||||
Produced
coal revenue
|
$ | 2,559,929 | $ | 2,054,413 | $ | 505,516 | 25 | % | ||||||||
Freight
and handling revenue
|
306,397 | 167,641 | 138,756 | 83 | % | |||||||||||
Purchased
coal revenue
|
30,684 | 108,191 | (77,507 | ) | (72 | )% | ||||||||||
Other
revenue
|
92,779 | 83,278 | 9,501 | 11 | % | |||||||||||
Total
revenues
|
$ | 2,989,789 | $ | 2,413,523 | $ | 576,266 | 24 | % |
Year
Ended
|
||||||||||||||||
December
31,
|
||||||||||||||||
(In
millions, except per ton amounts)
|
2008
|
2007
|
Increase
(Decrease)
|
%
Increase (Decrease)
|
||||||||||||
Produced tons sold:
|
||||||||||||||||
Utility
|
27.0 | 27.4 | (0.4 | ) | (1 | )% | ||||||||||
Metallurgical
|
9.9 | 8.5 | 1.4 | 16 | % | |||||||||||
Industrial
|
4.1 | 4.0 | 0.1 | 2 | % | |||||||||||
Total
|
41.0 | 39.9 | 1.1 | 3 | % | |||||||||||
Produced coal revenue per ton
sold:
|
||||||||||||||||
Utility
|
$ | 49.92 | $ | 45.18 | $ | 4.74 | 10 | % | ||||||||
Metallurgical
|
97.07 | 72.49 | 24.58 | 34 | % | |||||||||||
Industrial
|
61.78 | 50.82 | 10.96 | 22 | % | |||||||||||
Weighted
average
|
62.50 | 51.55 | 10.95 | 21 | % |
Year
Ended
|
||||||||||||||||
December
31,
|
||||||||||||||||
Increase
|
%
Increase
|
|||||||||||||||
(In
thousands)
|
2008
|
2007
|
(Decrease)
|
(Decrease)
|
||||||||||||
Costs
and expenses
|
||||||||||||||||
Cost
of produced coal revenue
|
$ | 1,910,953 | $ | 1,641,774 | $ | 269,179 | 16 | % | ||||||||
Freight
and handling costs
|
306,397 | 167,641 | 138,756 | 83 | % | |||||||||||
Cost
of purchased coal revenue
|
28,517 | 95,241 | (66,724 | ) | (70 | )% | ||||||||||
Depreciation,
depletion and amortization, applicable to:
|
- | |||||||||||||||
Cost
of produced coal revenue
|
253,737 | 242,755 | 10,982 | 5 | % | |||||||||||
Selling,
general and administrative
|
3,590 | 3,280 | 310 | 9 | % | |||||||||||
Selling,
general and administrative
|
77,015 | 75,845 | 1,170 | 2 | % | |||||||||||
Other
expense
|
3,207 | 7,308 | (4,101 | ) | (56 | )% | ||||||||||
Litigation
charge
|
250,061 | - | 250,061 | 100 | % | |||||||||||
Loss
on financing transactions
|
538 | - | 538 | 100 | % | |||||||||||
Net
change in fair value of derivative instruments
|
22,552 | - | 22,552 | 100 | % | |||||||||||
Total
costs and expenses
|
$ | 2,856,567 | $ | 2,233,844 | $ | 622,723 | 28 | % |
Year
Ended
|
||||||||||||||||
December
31,
|
||||||||||||||||
Increase
|
%
Increase
|
|||||||||||||||
(In
thousands)
|
2007
|
2006
|
(Decrease)
|
(Decrease)
|
||||||||||||
Revenues
|
||||||||||||||||
Produced
coal revenue
|
$ | 2,054,413 | $ | 1,902,259 | $ | 152,154 | 8 | % | ||||||||
Freight
and handling revenue
|
167,641 | 156,531 | 11,110 | 7 | % | |||||||||||
Purchased
coal revenue
|
108,191 | 70,636 | 37,555 | 53 | % | |||||||||||
Other
revenue
|
83,278 | 90,428 | (7,150 | ) | (8 | )% | ||||||||||
Total
revenues
|
$ | 2,413,523 | $ | 2,219,854 | $ | 193,669 | 9 | % |
Year
Ended
|
||||||||||||||||
December
31,
|
||||||||||||||||
(In
millions, except per ton amounts)
|
2007
|
2006
|
Increase
(Decrease)
|
%
Increase (Decrease)
|
||||||||||||
Produced tons sold:
|
||||||||||||||||
Utility
|
27.4 | 27.7 | (0.3 | ) | (1 | )% | ||||||||||
Metallurgical
|
8.5 | 7.8 | 0.7 | 9 | % | |||||||||||
Industrial
|
4.0 | 3.6 | 0.4 | 11 | % | |||||||||||
Total
|
39.9 | 39.1 | 0.8 | 2 | % | |||||||||||
Produced coal revenue per ton
sold:
|
||||||||||||||||
Utility
|
$ | 45.18 | $ | 42.37 | $ | 2.81 | 7 | % | ||||||||
Metallurgical
|
72.49 | 69.20 | 3.29 | 5 | % | |||||||||||
Industrial
|
50.82 | 53.13 | (2.31 | ) | (4 | )% | ||||||||||
Weighted
average
|
51.55 | 48.71 | 2.84 | 6 | % |
Year
Ended
|
||||||||||||||||
December
31,
|
||||||||||||||||
Increase
|
%
Increase
|
|||||||||||||||
(In
thousands)
|
2007
|
2006
|
(Decrease)
|
(Decrease)
|
||||||||||||
Costs
and expenses
|
||||||||||||||||
Cost
of produced coal revenue
|
$ | 1,641,774 | $ | 1,599,092 | $ | 42,682 | 3 | % | ||||||||
Freight
and handling costs
|
167,641 | 156,531 | 11,110 | 7 | % | |||||||||||
Cost
of purchased coal revenue
|
95,241 | 62,613 | 32,628 | 52 | % | |||||||||||
Depreciation,
depletion and amortization, applicable to:
|
||||||||||||||||
Cost
of produced coal revenue
|
242,755 | 227,279 | 15,476 | 7 | % | |||||||||||
Selling,
general and administrative
|
3,280 | 3,259 | 21 | 1 | % | |||||||||||
Selling,
general and administrative
|
75,845 | 53,834 | 22,011 | 41 | % | |||||||||||
Other
expense
|
7,308 | 6,240 | 1,068 | 17 | % | |||||||||||
Total
costs and expenses
|
$ | 2,233,844 | $ | 2,108,848 | $ | 124,996 | 6 | % |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
6.875%
senior notes due 2013, net of discount
|
$ | 756,041 | $ | 755,401 | ||||
3.25%
convertible senior notes due 2015
|
671,000 | - | ||||||
6.625%
senior notes due 2010
|
21,949 | 335,000 | ||||||
2.25%
convertible senior notes due 2024
|
9,647 | 9,647 | ||||||
4.75%
convertible senior notes due 2023
|
70 | 730 | ||||||
Capital
lease obligations
|
6,912 | 8,823 | ||||||
Fair
value hedge adjustment
|
- | (5,054 | ) | |||||
Total
debt
|
1,465,619 | 1,104,547 | ||||||
Amounts
due within one year
|
(1,976 | ) | (1,875 | ) | ||||
Total
long-term debt
|
$ | 1,463,643 | $ | 1,102,672 |
Current Ratings:
|
Moody’s
|
S&P
|
||
6.875%
Notes
|
B2
|
BB-
|
||
3.25%
Notes
|
NR
|
BB-
|
||
6.625%
Notes
|
B2
|
NR
|
||
2.25%
Notes
|
B2
|
BB-
|
||
4.75%
Notes
|
B3
|
NR
|
Period
|
Total
Number of Shares Purchased
|
Average
Price Paid per Share
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans or
Programs
|
Maximum
Number of Shares that May Yet Be Purchased Under the Plan
|
|||||||||||||
October
1 through October 31
|
- | - | - | - | |||||||||||||
November
1 through November 30
|
- | - | - | - | |||||||||||||
December
1 through December 31
|
- | - | - | - | |||||||||||||
Total
|
- | - | 27,667,984 |
(1)
|
(1)
|
Calculated
using $420 million that may yet be purchased under our share repurchase
program and $15.18, the closing price of Common Stock as reported on the
New York Stock Exchange on January 31,
2009.
|
Payments
Due by Period (In Thousands)
|
||||||||||||||||||||
Total
|
Within 1
Year
|
1-3
Years
|
3-5
Years
|
Beyond 5
Years
|
||||||||||||||||
Long-term
debt (1)
|
$ | 1,875,465 | $ | 75,732 | $ | 171,838 | $ | 908,556 | $ | 719,339 | ||||||||||
Capital
lease obligations
(2)
|
7,415 | 2,285 | 5,082 | 25 | 23 | |||||||||||||||
Operating
lease obligations (3)
|
292,595 | 71,237 | 126,677 | 75,831 | 18,850 | |||||||||||||||
Coal
lease obligations (4)
|
159,960 | 18,906 | 36,379 | 31,806 | 72,869 | |||||||||||||||
Purchased
coal obligations (5)
|
145,419 | 145,419 | - | - | - | |||||||||||||||
Other
purchase obligations (6)
|
333,095 | 323,290 | 7,555 | 2,250 | - | |||||||||||||||
Total
Obligations
|
$ | 2,813,949 | $ | 636,869 | $ | 347,531 | $ | 1,018,468 | $ | 811,081 |
(1)
|
Long-term
debt obligations reflect the future interest and principal payments of our
fixed rate senior unsecured notes outstanding as of December 31, 2008. See
Note 6 to the Notes to Consolidated Financial Statements for additional
information.
|
|
(2)
|
Capital
lease obligations include the amount of imputed interest over the terms of
the leases. See Note 13 to the Notes to Consolidated Financial Statements
for additional information.
|
|
(3)
|
See
Note 13 to the Notes to Consolidated Financial Statements for additional
information.
|
|
(4)
|
Coal
lease obligations include minimum royalties paid on leased coal rights.
Certain coal leases do not have set expiration dates but extend until
completion of mining of all merchantable and mineable coal reserves. For
purposes of this table, we have generally assumed that minimum royalties
on such leases will be paid for a period of 20 years.
|
|
(5)
|
Purchased
coal obligations represent commitments to purchase coal from external
production sources under firm contracts as of December 31,
2008.
|
|
(6)
|
Other
purchase obligations primarily include capital expenditure commitments for
surface mining and other equipment as well as purchases of materials and
supplies. We have purchase agreements with vendors for most types of
operating expenses. However, our open purchase orders (which are not
recognized as a liability until the purchased items are received) under
these purchase agreements, combined with any other open purchase orders,
are not material and are excluded from this table. Other purchase
obligations also include contractual commitments under transportation
contracts. Since the actual tons to be shipped under these contracts are
not set and will vary, the amount included in the table reflects the
minimum payment obligations required by the
contracts.
|
Payments
Due by Years (In Thousands)
|
||||
Within
1
Year
|
1
- 3
Years
|
3
- 5
Years
|
||
$50,880
|
$81,670
|
$99,148
|
Price
Range
|
Tons
Outstanding
|
Delivery
Period
|
|
Purchase
Contracts
|
$49.00-$103.00
|
1,758,000
|
01/01/09-12/31/09
|
Sales
Contracts
|
$48.00-$75.00
|
2,223,000
|
01/01/09-12/31/09
|
MASSEY
ENERGY COMPANY
|
||||||||||||
CONSOLIDATED
STATEMENTS OF INCOME
|
||||||||||||
(In
Thousands, Except Per Share Amounts)
|
||||||||||||
Year
Ended
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
Revenues
|
||||||||||||
Produced
coal revenue
|
$ | 2,559,929 | $ | 2,054,413 | $ | 1,902,259 | ||||||
Freight
and handling revenue
|
306,397 | 167,641 | 156,531 | |||||||||
Purchased
coal revenue
|
30,684 | 108,191 | 70,636 | |||||||||
Other
revenue
|
92,779 | 83,278 | 90,428 | |||||||||
Total
revenues
|
2,989,789 | 2,413,523 | 2,219,854 | |||||||||
Costs
and expenses
|
||||||||||||
Cost
of produced coal revenue
|
1,910,953 | 1,641,774 | 1,599,092 | |||||||||
Freight
and handling costs
|
306,397 | 167,641 | 156,531 | |||||||||
Cost
of purchased coal revenue
|
28,517 | 95,241 | 62,613 | |||||||||
Depreciation,
depletion and amortization, applicable to:
|
||||||||||||
Cost
of produced coal revenue
|
253,737 | 242,755 | 227,279 | |||||||||
Selling,
general and administrative
|
3,590 | 3,280 | 3,259 | |||||||||
Selling,
general and administrative
|
77,015 | 75,845 | 53,834 | |||||||||
Other
expense
|
3,207 | 7,308 | 6,240 | |||||||||
Litigation
charge
|
250,061 | - | - | |||||||||
Loss
on financing transactions
|
538 | - | - | |||||||||
Net
change in fair value of derivative instruments
|
22,552 | - | - | |||||||||
Total
costs and expenses
|
2,856,567 | 2,233,844 | 2,108,848 | |||||||||
Income
before interest and taxes
|
133,222 | 179,679 | 111,006 | |||||||||
Interest
income
|
23,576 | 23,969 | 20,094 | |||||||||
Interest
expense
|
(89,928 | ) | (74,145 | ) | (86,076 | ) | ||||||
Loss
on short-term investment
|
(6,537 | ) | - | - | ||||||||
Income
before taxes
|
60,333 | 129,503 | 45,024 | |||||||||
Income
tax expense
|
(4,085 | ) | (35,405 | ) | (3,408 | ) | ||||||
Income
before cumulative effect of accounting change
|
56,248 | 94,098 | 41,616 | |||||||||
Cumulative
effect of accounting change, net of tax
|
- | - | (639 | ) | ||||||||
Net
income
|
$ | 56,248 | $ | 94,098 | $ | 40,977 | ||||||
Income
per share - Basic
|
||||||||||||
Income
before cumulative effect of accounting change
|
$ | 0.69 | $ | 1.17 | $ | 0.51 | ||||||
Cumulative
effect of accounting change
|
- | - | (0.01 | ) | ||||||||
Net
income
|
$ | 0.69 | $ | 1.17 | $ | 0.50 | ||||||
Income
per share - Diluted
|
||||||||||||
Income
before cumulative effect of accounting change
|
$ | 0.68 | $ | 1.17 | $ | 0.51 | ||||||
Cumulative
effect of accounting change
|
- | - | (0.01 | ) | ||||||||
Net
income
|
$ | 0.68 | $ | 1.17 | $ | 0.50 | ||||||
Shares
used to calculate income per share
|
||||||||||||
Basic
|
81,816 | 80,123 | 80,847 | |||||||||
Diluted
|
82,895 | 80,654 | 81,386 |
CONSOLIDATED
BALANCE SHEETS
|
||||||||||
(In
Thousands, Except Share Amounts)
|
||||||||||
December
31,
|
December
31,
|
|||||||||
2008
|
2007
|
|||||||||
ASSETS
|
||||||||||
Current Assets | ||||||||||
Cash and cash equivalents | $ | 606,997 | $ | 365,220 | ||||||
Short-term investment | 39,383 | - | ||||||||
Trade and other accounts receivable, less allowance of $873 and $444, | ||||||||||
respectively
|
233,266 | 156,572 | ||||||||
Inventories | 233,168 | 183,360 | ||||||||
Income taxes receivable | 6,621 | 16,302 | ||||||||
Other current assets | 116,061 | 165,940 | ||||||||
Total
current assets
|
1,235,496 | 887,394 | ||||||||
Net Property, Plant and Equipment | 2,297,696 | 1,793,920 | ||||||||
Other Noncurrent Assets | ||||||||||
Pension assets | - | 47,323 | ||||||||
Other noncurrent assets | 142,644 | 132,034 | ||||||||
Total
other noncurrent assets
|
142,644 | 179,357 | ||||||||
Total
assets
|
$ | 3,675,836 | $ | 2,860,671 | ||||||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
||||||||||
Current Liabilities | ||||||||||
Accounts payable, principally trade and bank overdrafts | $ | 244,201 | $ | 148,206 | ||||||
Short-term debt | 1,976 | 1,875 | ||||||||
Payroll and employee benefits | 56,959 | 46,512 | ||||||||
Other current liabilities | 201,017 | 171,269 | ||||||||
Total
current liabilities
|
504,153 | 367,862 | ||||||||
Noncurrent Liabilities | ||||||||||
Long-term debt | 1,463,643 | 1,102,672 | ||||||||
Deferred income taxes | 117,268 | 154,705 | ||||||||
Pension obligation | 63,304 | - | ||||||||
Other noncurrent liabilities | 490,834 | 451,428 | ||||||||
Total
noncurrent liabilities
|
2,135,049 | 1,708,805 | ||||||||
Total
liabilities
|
2,639,202 | 2,076,667 | ||||||||
Shareholders’ Equity | ||||||||||
Capital stock | ||||||||||
Preferred
– authorized 20,000,000 shares without par value; none
issued
|
- | - | ||||||||
Common
– authorized 150,000,000 shares of $0.625 par value;
issued
|
||||||||||
85,447,970
and 82,818,578 shares, respectively
|
53,378 | 51,743 | ||||||||
Treasury stock, 2,874,800 shares at cost | - | (79,986 | ) | |||||||
Additional capital | 444,122 | 237,684 | ||||||||
Retained earnings | 640,496 | 601,587 | ||||||||
Accumulated other comprehensive loss | (101,362 | ) | (27,024 | ) | ||||||
Total
shareholders’ equity
|
1,036,634 | 784,004 | ||||||||
Total
liabilities and shareholders’ equity
|
$ | 3,675,836 | $ | 2,860,671 |
CONSOLIDATED
STATEMENT OF CASH FLOWS
|
||||||||||||
(In
Thousands)
|
||||||||||||
Year
Ended
|
||||||||||||
December
31, 2008
|
December
31, 2007
|
December
31, 2006
|
||||||||||
Cash
Flows from Operating Activities
|
||||||||||||
Net
income
|
$ | 56,248 | $ | 94,098 | $ | 40,977 | ||||||
Adjustments
to reconcile Net income to Cash provided by operating
|
||||||||||||
activities:
|
||||||||||||
Cumulative
effect of accounting change
|
- | - | 639 | |||||||||
Depreciation,
depletion and amortization
|
257,327 | 246,035 | 230,538 | |||||||||
Share-based
compensation expense
|
13,856 | 17,095 | 7,350 | |||||||||
Deferred
income taxes
|
8,560 | 27,403 | (17,381 | ) | ||||||||
Gain
on disposal of assets
|
(2,926 | ) | (6,751 | ) | (46,557 | ) | ||||||
Gain
on reserve exchanges
|
(32,449 | ) | (10,284 | ) | - | |||||||
Loss
on financing transactions
|
7,049 | - | - | |||||||||
Net
change in fair value of derivative instruments
|
22,552 | - | - | |||||||||
Unrealized
loss on short-term investment
|
6,537 | - | - | |||||||||
Accretion
of asset retirement obligations
|
11,844 | 11,758 | 10,166 | |||||||||
Changes
in operating assets and liabilities:
|
||||||||||||
(Increase)
decrease in accounts receivable
|
(77,953 | ) | 19,253 | (43,456 | ) | |||||||
(Increase)
decrease in inventories
|
(49,808 | ) | 7,696 | (8,070 | ) | |||||||
Decrease
in other current assets
|
46,724 | 6,382 | 24,573 | |||||||||
(Increase)
decrease in other assets
|
(6,902 | ) | (5,362 | ) | 9,920 | |||||||
Increase
(decrease) in accounts payable and bank overdrafts
|
95,995 | 31,049 | (45,632 | ) | ||||||||
Increase
(decrease) in accrued income taxes
|
10,048 | (35,714 | ) | 42,638 | ||||||||
Increase
(decrease) in other accrued liabilities
|
21,189 | (558 | ) | 17,046 | ||||||||
Increase
(decrease) in pension obligation
|
1,625 | 5,171 | (8,755 | ) | ||||||||
Increase
(decrease) in other noncurrent liabilities
|
522 | (212 | ) | 4,712 | ||||||||
Asset
retirement obligation payments
|
(4,957 | ) | (11,061 | ) | (4,205 | ) | ||||||
Cash
provided by operating activities
|
385,081 | 395,998 | 214,503 | |||||||||
Cash
Flows from Investing Activities
|
||||||||||||
Capital
expenditures
|
(736,529 | ) | (270,461 | ) | (298,132 | ) | ||||||
Redesignation
of cash equivalent to short-term investment
|
(217,900 | ) | - | - | ||||||||
Proceeds
from redemption of short-term investment
|
171,980 | - | - | |||||||||
Proceeds
from sale of assets
|
5,958 | 28,118 | 51,467 | |||||||||
Cash
utilized by investing activities
|
(776,491 | ) | (242,343 | ) | (246,665 | ) | ||||||
Cash
Flows from Financing Activities
|
||||||||||||
Issuance
of common stock
|
258,188 | - | - | |||||||||
Stock
repurchase
|
- | (29,991 | ) | (49,995 | ) | |||||||
Repayments
of capital lease obligations
|
(1,911 | ) | (2,409 | ) | (10,214 | ) | ||||||
Proceeds
from issuance of 3.25% convertible senior notes
|
674,136 | - | - | |||||||||
Repurchase
of 3.25% convertible senior notes
|
(10,450 | ) | - | - | ||||||||
Tender
payment for 6.625% senior notes
|
(322,139 | ) | - | - | ||||||||
Proceeds
from sale-leaseback transactions
|
41,318 | 13,146 | 21,819 | |||||||||
Cash
dividends paid
|
(21,310 | ) | (12,837 | ) | (12,814 | ) | ||||||
Proceeds
from stock options exercised
|
16,519 | 4,001 | 2,142 | |||||||||
Excess
income tax (expense) benefit from stock option exercises
|
(1,164 | ) | 410 | 1,051 | ||||||||
Cash
provided (utilized) by financing activities
|
633,187 | (27,680 | ) | (48,011 | ) | |||||||
Increase
(decrease) in cash and cash equivalents
|
241,777 | 125,975 | (80,173 | ) | ||||||||
Cash
and cash equivalents at beginning of period
|
365,220 | 239,245 | 319,418 | |||||||||
Cash
and cash equivalents at end of period
|
$ | 606,997 | $ | 365,220 | $ | 239,245 | ||||||
Supplemental
Cash Flow Information
|
||||||||||||
Cash
paid during the period for income taxes
|
$ | 4,219 | $ | 34,052 | $ | 157 |
CONSOLIDATED
STATEMENT OF SHAREHOLDERS' EQUITY
|
||||||||||||||||||||||||||||||||
(In
Thousands, Except Per Share Amounts)
|
||||||||||||||||||||||||||||||||
Unamortized
|
Accumulated
|
|||||||||||||||||||||||||||||||
Executive
|
Other
|
Total
|
||||||||||||||||||||||||||||||
Common
Stock
|
Additional
|
Stock
Plan
|
Retained
|
Comprehensive
|
Treasury
|
Shareholders'
|
||||||||||||||||||||||||||
Shares
|
Amount
|
Capital
|
Expense
|
Earnings
|
Loss
|
Stock
|
Equity
|
|||||||||||||||||||||||||
Balance
at December 31, 2005
|
81,940 | $ | 51,213 | $ | 215,749 | $ | (7,130 | ) | $ | 581,621 | $ | (469 | ) | $ | - | $ | 840,984 | |||||||||||||||
Net
income
|
40,977 | 40,977 | ||||||||||||||||||||||||||||||
Other
comprehensive income, net of
|
||||||||||||||||||||||||||||||||
deferred
tax of $(21):
|
||||||||||||||||||||||||||||||||
Minimum pension liability
|
||||||||||||||||||||||||||||||||
adjustment
|
109 | 109 | ||||||||||||||||||||||||||||||
Comprehensive
income
|
41,086 | |||||||||||||||||||||||||||||||
Adoption
of accounting standards:
|
||||||||||||||||||||||||||||||||
Share-based
payments
|
(7,130 | ) | 7,130 | - | ||||||||||||||||||||||||||||
Post-production
stripping costs,
|
||||||||||||||||||||||||||||||||
net of deferred tax of $59,970
|
(93,798 | ) | (93,798 | ) | ||||||||||||||||||||||||||||
Pension
and postretirement plans,
|
- | |||||||||||||||||||||||||||||||
net of deferred tax of $25,801
|
(40,356 | ) | (40,356 | ) | ||||||||||||||||||||||||||||
Dividends
declared ($0.16 per share)
|
(12,906 | ) | (12,906 | ) | ||||||||||||||||||||||||||||
Stock
option expense
|
6,112 | 6,112 | ||||||||||||||||||||||||||||||
Exercise
of stock options
|
185 | 115 | 2,027 | 2,142 | ||||||||||||||||||||||||||||
Stock
option tax benefit
|
1,051 | 1,051 | ||||||||||||||||||||||||||||||
Restricted
stock
|
239 | 129 | 2,822 | 2,951 | ||||||||||||||||||||||||||||
Share
repurchase
|
(1,299 | ) | (49,995 | ) | (49,995 | ) | ||||||||||||||||||||||||||
Issuance
of stock for debt conversion
|
1 | 1 | 19 | 20 | ||||||||||||||||||||||||||||
Balance
at December 31, 2006
|
81,066 | $ | 51,458 | $ | 220,650 | $ | - | $ | 515,894 | $ | (40,716 | ) | $ | (49,995 | ) | $ | 697,291 | |||||||||||||||
Net
income
|
94,098 | 94,098 | ||||||||||||||||||||||||||||||
Other
comprehensive income:
|
||||||||||||||||||||||||||||||||
Pension
and postretirement plans,
|
||||||||||||||||||||||||||||||||
net of deferred tax of $8,754
|
13,692 | 13,692 | ||||||||||||||||||||||||||||||
Comprehensive
income
|
107,790 | |||||||||||||||||||||||||||||||
Adoption
of accounting standards:
|
||||||||||||||||||||||||||||||||
Uncertainty
in income taxes
|
5,182 | 5,182 | ||||||||||||||||||||||||||||||
Dividends
declared ($0.17 per share)
|
(13,587 | ) | (13,587 | ) | ||||||||||||||||||||||||||||
Stock
option expense
|
8,308 | 8,308 | ||||||||||||||||||||||||||||||
Exercise
of stock options
|
299 | 188 | 3,813 | 4,001 | ||||||||||||||||||||||||||||
Stock
option tax benefit
|
410 | 410 | ||||||||||||||||||||||||||||||
Restricted
stock
|
155 | 97 | 4,503 | 4,600 | ||||||||||||||||||||||||||||
Share
repurchase
|
(1,576 | ) | (29,991 | ) | (29,991 | ) | ||||||||||||||||||||||||||
Balance
at December 31, 2007
|
79,944 | $ | 51,743 | $ | 237,684 | $ | - | $ | 601,587 | $ | (27,024 | ) | $ | (79,986 | ) | $ | 784,004 | |||||||||||||||
Net
income
|
56,248 | 56,248 | ||||||||||||||||||||||||||||||
Other
comprehensive income:
|
||||||||||||||||||||||||||||||||
Pension
and postretirement plans,
|
||||||||||||||||||||||||||||||||
net of deferred tax of $47,528
|
(74,338 | ) | (74,338 | ) | ||||||||||||||||||||||||||||
Comprehensive
loss
|
(18,090 | ) | ||||||||||||||||||||||||||||||
Dividends
declared ($0.21 per share)
|
(17,339 | ) | (17,339 | ) | ||||||||||||||||||||||||||||
Stock
option expense
|
8,204 | 8,204 | ||||||||||||||||||||||||||||||
Exercise
of stock options
|
787 | 492 | 16,027 | 16,519 | ||||||||||||||||||||||||||||
Stock
option tax expense
|
(1,164 | ) | (1,164 | ) | ||||||||||||||||||||||||||||
Restricted
stock
|
300 | 185 | 5,467 | 5,652 | ||||||||||||||||||||||||||||
Issuance
of stock for debt conversion
|
34 | 21 | 639 | 660 | ||||||||||||||||||||||||||||
Issuance
of additional common shares
|
4,370 | 937 | 177,265 | 79,986 | 258,188 | |||||||||||||||||||||||||||
Balance
at December 31, 2008
|
85,435 | $ | 53,378 | $ | 444,122 | $ | - | $ | 640,496 | $ | (101,362 | ) | $ | - | $ | 1,036,634 |
Years
|
|
Buildings
and plants
|
20
to 30
|
Equipment
|
3
to 20
|
Capital
leases
|
4
to 7
|
Year
Ended
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
(In
Thousands, Except Per Share Amounts)
|
||||||||||||
Numerator:
|
||||||||||||
Income
before cumulative effect of accounting change - numerator for
basic
|
$ | 56,248 | $ | 94,098 | $ | 41,616 | ||||||
Cumulative
effect of accounting change, net of tax
|
- | - | (639 | ) | ||||||||
Effect
of convertible notes
|
188 | 200 | - | |||||||||
Net
income - numerator for diluted
|
$ | 56,436 | $ | 94,298 | $ | 40,977 | ||||||
Denominator:
|
||||||||||||
Weighted
average shares - denominator for basic
|
81,816 | 80,123 | 80,847 | |||||||||
Effect
of stock options/restricted stock
|
772 | 207 | 539 | |||||||||
Effect
of convertible notes
|
307 | 324 | - | |||||||||
Adjusted
weighted average shares - denominator for diluted
|
82,895 | 80,654 | 81,386 | |||||||||
Income
per share:
|
||||||||||||
Basic:
|
||||||||||||
Before
cumulative effect of accounting change
|
$ | 0.69 | $ | 1.17 | $ | 0.51 | ||||||
Cumulative
effect of accounting change
|
- | - | (0.01 | ) | ||||||||
Net
income
|
$ | 0.69 | $ | 1.17 | $ | 0.50 | ||||||
Diluted:
|
||||||||||||
Before
cumulative effect of accounting change
|
$ | 0.68 | $ | 1.17 | $ | 0.51 | ||||||
Cumulative
effect of accounting change
|
- | - | (0.01 | ) | ||||||||
Net
income
|
$ | 0.68 | $ | 1.17 | $ | 0.50 |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Saleable
coal
|
$ | 144,834 | $ | 120,343 | ||||
Raw
coal
|
16,802 | 11,471 | ||||||
Subtotal
coal inventory
|
161,636 | 131,814 | ||||||
Supplies
inventory
|
71,532 | 51,546 | ||||||
Total
inventory
|
$ | 233,168 | $ | 183,360 |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Longwall
panel costs
|
$ | 12,290 | $ | 18,029 | ||||
Deposits
|
59,648 | 109,200 | ||||||
Other
|
44,123 | 38,711 | ||||||
Total
other current assets
|
$ | 116,061 | $ | 165,940 |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Land,
buildings and equipment
|
$ | 2,538,762 | $ | 2,082,003 | ||||
Mining
properties owned in fee and leased mineral rights
|
779,932 | 704,547 | ||||||
Mine
development
|
1,054,631 | 863,303 | ||||||
Total
property, plant and equipment
|
4,373,325 | 3,649,853 | ||||||
Less
accumulated depreciation, depletion and amortization
|
(2,075,629 | ) | (1,855,933 | ) | ||||
Net
property, plant and equipment
|
$ | 2,297,696 | $ | 1,793,920 |
December
31,
|
December
31,
|
|||||||||||||||
2008
|
2007
|
|||||||||||||||
(Dollars
In Thousands)
|
||||||||||||||||
Equity
securities (domestic and international)
|
$ | 112,638 | 54.2 | % | $ | 187,439 | 64.2 | % | ||||||||
Debt
securities
|
70,032 | 33.7 | % | 72,417 | 24.8 | % | ||||||||||
Other
(includes cash, cash equivalents and a group annuity
contract)
|
25,080 | 12.1 | % | 31,891 | 11.0 | % | ||||||||||
Total
fair value of plan assets
|
$ | 207,750 | 100.0 | % | $ | 291,747 | 100.0 | % |
Year
Ended
|
||||||||
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Change
in benefit obligation:
|
||||||||
Benefit
obligation at the beginning of the period
|
$ | 252,237 | $ | 256,925 | ||||
Service
cost
|
8,680 | 9,716 | ||||||
Interest
cost
|
15,881 | 15,023 | ||||||
Actuarial
loss (gain)
|
14,103 | (18,796 | ) | |||||
Benefits
paid
|
(10,773 | ) | (10,631 | ) | ||||
Benefit
obligation at the end of the period
|
280,128 | 252,237 | ||||||
Change
in plan assets:
|
||||||||
Fair
value at the beginning of the period
|
291,747 | 285,419 | ||||||
Actual
(loss) return on assets
|
(73,286 | ) | 16,512 | |||||
Company
contributions
|
62 | 447 | ||||||
Benefits
paid
|
(10,773 | ) | (10,631 | ) | ||||
Fair
value of plan assets at end of period
|
207,750 | 291,747 | ||||||
Funded
status
|
$ | (72,378 | ) | $ | 39,510 | |||
Qualified
defined benefit pension plan, included in Pension (obligation)
assets
|
$ | (63,304 | ) | $ | 47,323 | |||
Nonqualified
supplemental benefit pension plan, included in Other noncurrent
liabilities
|
(9,074 | ) | (7,813 | ) | ||||
Accrued
pension (obligation) assets recognized, net
|
$ | (72,378 | ) | $ | 39,510 |
2008
|
2007
|
|||||||||||||||
(In
Thousands)
|
||||||||||||||||
Net
loss
|
Prior
service cost
|
Net
loss
|
Prior
service cost
|
|||||||||||||
January
1 beginning balance
|
22,482 | 60 | 32,821 | 84 | ||||||||||||
Changes
to Accumulated other comprehensive loss
|
66,778 | (26 | ) | (10,339 | ) | (24 | ) | |||||||||
December
31 ending balance
|
$ | 89,260 | $ | 34 | $ | 22,482 | $ | 60 |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
Discount
rates
|
6.10 | % | 6.50 | % | ||||
Rates
of increase in compensation levels
|
4.00 | % | 4.00 | % |
Year
Ended
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
(In
Thousands)
|
||||||||||||
Service
cost
|
$ | 8,680 | $ | 9,716 | $ | 9,230 | ||||||
Interest
cost
|
15,881 | 15,023 | 13,922 | |||||||||
Expected
return on plan assets
|
(22,852 | ) | (22,427 | ) | (19,952 | ) | ||||||
Recognized
loss
|
770 | 4,068 | 6,226 | |||||||||
Amortization
of prior service cost
|
42 | 39 | 39 | |||||||||
Net
periodic pension expense
|
$ | 2,521 | $ | 6,419 | $ | 9,465 |
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
Discount
rates
|
6.50 | % | 5.90 | % | 5.75 | % | ||||||
Rates
of increase in compensation levels
|
4.00 | % | 4.00 | % | 4.00 | % | ||||||
Expected
long-term rate of return on plan assets
|
8.00 | % | 8.00 | % | 8.00 | % |
Benefit
Payments
|
||||
(In
Thousands)
|
||||
2009
|
$ | 12,421 | ||
2010
|
12,960 | |||
2011
|
13,514 | |||
2012
|
14,360 | |||
2013
|
15,069 | |||
Years
2014 to 2018
|
90,027 |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
6.875%
senior notes due 2013, net of discount
|
$ | 756,041 | $ | 755,401 | ||||
3.25%
convertible senior notes due 2015
|
671,000 | - | ||||||
6.625%
senior notes due 2010
|
21,949 | 335,000 | ||||||
2.25%
convertible senior notes due 2024
|
9,647 | 9,647 | ||||||
4.75%
convertible senior notes due 2023
|
70 | 730 | ||||||
Capital
lease obligations
|
6,912 | 8,823 | ||||||
Fair
value hedge adjustment
|
- | (5,054 | ) | |||||
Total
debt
|
1,465,619 | 1,104,547 | ||||||
Amounts
due within one year
|
(1,976 | ) | (1,875 | ) | ||||
Total
long-term debt
|
$ | 1,463,643 | $ | 1,102,672 |
·
|
during
any calendar quarter, if the closing sale price of our shares of Common
Stock for each of 20 or more trading days in a period of 30 consecutive
trading days ending on the last trading day of the immediately preceding
calendar quarter exceeds 130% of the conversion price in effect on the
last trading day of the immediately preceding calendar
quarter;
|
·
|
during
the five consecutive business days immediately after any five consecutive
trading day period (the “note measurement period”) in which the average
trading price per $1,000 principal amount of 3.25% Notes was equal to or
less than 97% of the average conversion value of the 3.25% Notes during
the note measurement period;
|
·
|
if
we make certain distributions on our shares of Common Stock or engage in
certain transactions; and
|
·
|
at
any time from, and including, February 1, 2015 until the close of business
on the second business day immediately preceding August 1,
2015.
|
(In
Thousands)
|
||||
2009
|
$ | 1,976 | ||
2010
|
24,167 | |||
2011
|
2,670 | |||
2012
|
13 | |||
2013
|
760,012 | |||
Beyond
2013*
|
680,740 |
*
|
The
4.75% Notes and the 2.25% Notes in the amounts of $0.1 million and $9.6
million, respectively, included herein may be redeemed at the option of
the holders in 2009 and 2011,
respectively.
|
Year
Ended
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
(In
Thousands)
|
||||||||||||
Current:
|
||||||||||||
Federal
|
$ | (4,597 | ) | $ | 7,876 | $ | 20,694 | |||||
State
and local
|
122 | 126 | 95 | |||||||||
Total
current
|
(4,475 | ) | 8,002 | 20,789 | ||||||||
Deferred:
|
||||||||||||
Federal
|
7,274 | 24,593 | (15,439 | ) | ||||||||
State
and local
|
1,286 | 2,810 | (1,942 | ) | ||||||||
Total
deferred
|
8,560 | 27,403 | (17,381 | ) | ||||||||
Income
tax expense
|
$ | 4,085 | $ | 35,405 | $ | 3,408 |
Year
Ended
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
(In
Thousands)
|
||||||||||||
U.S.
statutory federal tax expense
|
$ | 21,117 | $ | 45,326 | $ | 15,758 | ||||||
Increase
(Decrease) resulting from:
|
||||||||||||
State taxes
|
66 | (116 | ) | (2,393 | ) | |||||||
Non-deductible penalties
|
6,240 | 8,062 | 852 | |||||||||
Percentage depletion
|
(45,671 | ) | (33,501 | ) | (25,897 | ) | ||||||
Non-deductible compensation
|
666 | 711 | 1,279 | |||||||||
Non-deductible refinancing and exchange offer costs
|
- | (4,809 | ) | - | ||||||||
Extraterritorial excluded income
|
- | - | (797 | ) | ||||||||
Valuation allowance adjustment
|
28,098 | 31,343 | 16,066 | |||||||||
Uncertain tax positions
|
- | (2,325 | ) | (1,197 | ) | |||||||
Alternative minimum tax credit refund, net of adjustment
|
(4,770 | ) | - | - | ||||||||
Refund from settlement of 2001 IRS audit
|
- | (4,609 | ) | - | ||||||||
Other, net
|
(1,661 | ) | (4,677 | ) | (263 | ) | ||||||
Income
tax expense
|
$ | 4,085 | $ | 35,405 | $ | 3,408 |
Year
Ended
|
|||||||||
December
31,
|
December
31,
|
||||||||
2008
|
2007
|
||||||||
(In
Thousands)
|
|||||||||
Deferred
tax assets:
|
|||||||||
Postretirement
benefit obligations
|
$ | 117,106 | $ | 66,235 | |||||
Workers'
compensation
|
24,682 | 22,588 | |||||||
Reclamation
and mine closure
|
46,608 | 47,281 | |||||||
Alternative
minimum tax credit carryforwards
|
104,782 | 119,651 | |||||||
Litigation
|
9,777 | 10,247 | |||||||
Deferred
compensation
|
26,088 | 24,308 | |||||||
Federal
net operating loss
|
115,897 | 98,434 | |||||||
State
net operating loss
|
25,083 | 28,194 | |||||||
Other
|
35,718 | 27,835 | |||||||
Total deferred tax assets | 505,741 | 444,773 | |||||||
Valuation
allowance for deferred tax assets
|
(202,318 | ) | (194,122 | ) | |||||
Total deferred tax assets, net of valuation allowance | 303,423 | 250,651 | |||||||
Deferred
tax liabilities:
|
|||||||||
Plant,
equipment and mine development
|
(273,878 | ) | (275,362 | ) | |||||
Mining
property and mineral rights
|
(131,308 | ) | (117,609 | ) | |||||
Deferred
royalties
|
(9,863 | ) | (10,339 | ) | |||||
Other
|
(5,642 | ) | (2,046 | ) | |||||
Total deferred tax liablities
|
(420,691 | ) | (405,356 | ) | |||||
Deferred
income taxes
|
$ | (117,268 | ) | $ | (154,705 | ) |
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Balance
at January 1
|
$ | - | $ | 2,325 | ||||
Additions
based on tax positions related to the current year
|
- | - | ||||||
Additions
for tax positions of prior years
|
- | 49,130 | ||||||
Reductions
for tax positions of prior years
|
- | (2,325 | ) | |||||
Settlements
|
- | (49,130 | ) | |||||
Reductions
due to lapse of applicable statute of limitations
|
- | - | ||||||
Balance
at December 31
|
$ | - | $ | - |
December
31,
|
December
31,
|
||||||||
2008
|
2007
|
||||||||
(In
Thousands)
|
|||||||||
Reclamation
(Note 9)
|
$ | 154,823 | $ | 142,213 | |||||
Other
postretirement benefits (Note 10)
|
161,527 | 141,087 | |||||||
Workers'
compensation and black lung (Note 11)
|
92,982 | 90,702 | |||||||
Other
|
81,502 | 77,426 | |||||||
Total other noncurrent liabilities | $ | 490,834 | $ | 451,428 |
Year
Ended
|
||||||||
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Reclamation
liability at beginning of period
|
$ | 168,641 | $ | 171,954 | ||||
Accretion
expense
|
11,844 | 11,758 | ||||||
Liability
assumed/incurred
|
16,956 | 2,168 | ||||||
Liability
disposed
|
(212 | ) | (142 | ) | ||||
Revisions
in estimated cash flows
|
(6,092 | ) | (6,036 | ) | ||||
Payments
|
(4,957 | ) | (11,061 | ) | ||||
Reclamation
liability at end of period
|
186,180 | 168,641 | ||||||
Less
amount included in Other current liabilities
|
31,357 | 26,428 | ||||||
Total
reclamation, included in Other noncurrent liabilities
|
$ | 154,823 | $ | 142,213 |
Year
Ended
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
(In
Thousands)
|
||||||||||||
Service
cost
|
$ | 3,204 | $ | 3,668 | $ | 3,758 | ||||||
Interest
cost
|
8,845 | 8,467 | 7,959 | |||||||||
Amortization
of net loss
|
813 | 1,864 | 2,307 | |||||||||
Amortization
of prior service credit
|
(750 | ) | (750 | ) | (750 | ) | ||||||
Net
periodic postretirement benefit cost
|
$ | 12,112 | $ | 13,249 | $ | 13,274 |
Year
Ended
|
||||||||
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Change
in benefit obligation:
|
||||||||
Benefit
obligation at the beginning of the period
|
$ | 147,733 | $ | 144,325 | ||||
Service
cost
|
3,204 | 3,668 | ||||||
Interest
cost
|
8,845 | 8,467 | ||||||
Actuarial
loss/(gain)
|
15,538 | (3,546 | ) | |||||
Benefits
paid
|
(6,691 | ) | (5,181 | ) | ||||
Benefit
obligation at the end of the period
|
$ | 168,629 | $ | 147,733 | ||||
Accrued
postretirement benefit obligation
|
$ | 168,629 | $ | 147,733 | ||||
Amount
included in Payroll and employee benefits
|
7,102 | 6,646 | ||||||
Postretirement
benefit obligation, included in Other noncurrent
liabilities
|
$ | 161,527 | $ | 141,087 |
Year
Ended
|
||||||||||||||||
2008
|
2007
|
|||||||||||||||
(In
Thousands)
|
||||||||||||||||
Net
loss
|
Prior
service credit
|
Net
loss
|
Prior
service credit
|
|||||||||||||
January
1 beginning balance
|
$ | 20,132 | $ | (5,063 | ) | $ | 23,434 | $ | (5,521 | ) | ||||||
Changes
to Accumulated other comprehensive loss
|
8,979 | 458 | (3,302 | ) | 458 | |||||||||||
December
31 ending balance
|
$ | 29,111 | $ | (4,605 | ) | $ | 20,132 | $ | (5,063 | ) |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
Health
care cost trend rate for next year
|
8.50%
/ 8.80% / 7.00%
|
* | 8.50% | |||||
Ultimate
trend rate
|
5.00% | 5.00% | ||||||
Year
that the rate reaches ultimate trend rate
|
2019
|
2013
|
||||||
*
8.5% represents the initial trend rate for pre-medicare claims, 8.8% for
medicare-eligible, and
|
||||||||
7.0%
for the medicare supplement plan
|
1-Percentage
Point Increase
|
1-Percentage
Point Decrease
|
|||||||
(In
Thousands)
|
||||||||
Effect
on total of service and interest costs components
|
$ | 2,020 | $ | (1,626 | ) | |||
Effect
on accumulated postretirement benefit obligation
|
$ | 25,502 | $ | (20,896 | ) |
Expected
Benefit Payments
|
||||
(In
Thousands)
|
||||
2009
|
$ | 7,102 | ||
2010
|
7,835 | |||
2011
|
8,671 | |||
2012
|
9,313 | |||
2013
|
10,057 | |||
Years
2014 to 2018
|
55,528 |
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Accrued
self-insured black lung obligation
|
$ | 50,739 | $ | 53,412 | ||||
Workers'
compensation (traumatic injury)
|
64,172 | 58,788 | ||||||
Total
accrued workers' compensation and black lung
|
114,911 | 112,200 | ||||||
Less
amount included in Other current liabilities
|
21,929 | 21,498 | ||||||
Workers'
compensation & black lung in Other noncurrent
liabilities
|
$ | 92,982 | $ | 90,702 |
Year
Ended
|
||||||||
December
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Beginning
of year accrued self-insured black lung obligation
|
$ | 53,412 | $ | 53,284 | ||||
Service
cost
|
2,186 | 2,495 | ||||||
Interest
cost
|
3,390 | 3,117 | ||||||
Actuarial
gain
|
(6,524 | ) | (3,989 | ) | ||||
Benefit
payments
|
(1,725 | ) | (1,495 | ) | ||||
Accrued
self-insured black lung obligation
|
$ | 50,739 | $ | 53,412 |
2008
|
2007
|
|||||||
(In
Thousands)
|
||||||||
Net
gain
|
Net
gain
|
|||||||
January
1 beginning balance
|
$ | (10,587 | ) | $ | (10,102 | ) | ||
Changes
to Accumulated other comprehensive loss
|
(1,851 | ) | (485 | ) | ||||
December
31 ending balance
|
(12,438 | ) | (10,587 | ) |
Year
Ended
|
||||||||||||
December
31,
|
December
31,
|
December
31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||||
(In
Thousands)
|
||||||||||||
Self-insured
black lung benefits:
|
||||||||||||
Service
cost
|
$ | 2,186 | $ | 2,495 | $ | 2,619 | ||||||
Interest
cost
|
3,390 | 3,117 | 2,861 | |||||||||
Amortization
of actuarial gain
|
(3,489 | ) | (3,194 | ) | (3,759 | ) | ||||||
2,087 | 2,418 | 1,721 | ||||||||||
Other
workers' compensation benefits
|
27,965 | 30,842 | 36,381 | |||||||||
$ | 30,052 | $ | 33,260 | $ | 38,102 |
1-Percentage
Point Increase
|
1-Percentage
Point Decrease
|
|||||||
Increase/decrease
in medical cost trend rate:
|
||||||||
Effect
on total of service and interest costs components
|
$ | 183 | $ | (145 | ) | |||
Effect
on accumulated black lung obligation
|
$ | 1,376 | $ | (1,119 | ) | |||
Increase/decrease
in cost of living trend rate:
|
||||||||
Effect
on total service and interest cost components
|
$ | 696 | $ | (558 | ) | |||
Effect
on accumulated black lung obligation
|
$ | 5,548 | $ | (4,537 | ) |
Expected
Benefit Payments
|
||||
(In
Thousands)
|
||||
2009
|
$ | 2,867 | ||
2010
|
3,024 | |||
2011
|
3,181 | |||
2012
|
3,332 | |||
2013
|
3,478 | |||
Years
2014 to 2018
|
19,412 |
·
|
Massey
Energy Company 1996 Executive Stock Plan, as amended and restated
effective November 30, 2000 (the “1996
Plan”),
|
·
|
Massey
Energy Company 1997 Stock Appreciation Rights Plan, as amended and
restated effective November 30, 2000 (the “SAR
Plan”),
|
·
|
Massey
Energy Company 1999 Executive Performance Incentive Plan, as amended and
restated effective November 30, 2000 (the “1999
Plan”),
|
·
|
Massey
Energy Company Stock Plan for Non-Employee Directors, as amended and
restated effective May 24, 2005 (the “1995 Plan”),
and
|
·
|
Massey
Energy Company 1997 Restricted Stock Plan for Non-Employee Directors, as
amended and restated effective May 24, 2005 (the “1997
Plan”).
|
Years
Ended December 31,
|
||||||||||||
Options
Granted
|
2008
|
2007
|
2006
|
|||||||||
Number
of shares underlying options
|
798,647 | 556,979 | 642,434 | |||||||||
Contractual
term in years
|
10 | 10 | 10 | |||||||||
Assumptions
used to estimate fair value:
|
||||||||||||
Expected
volatility
|
50%
- 100%
|
46%
- 50%
|
46%
- 55%
|
|||||||||
Weighted
average volatility
|
71%
|
50%
|
46%
|
|||||||||
Expected
option life in years
|
1.3
- 4.3
|
1.2
- 4.3
|
1.2
- 5.0
|
|||||||||
Dividend
yield
|
0.4%
- 1.5%
|
0.6%
- 0.7%
|
0.4%
- 0.7%
|
|||||||||
Risk-free
interest rate
|
0.9%
- 3.1%
|
3.0%
- 4.7%
|
4.2%
- 4.8%
|
|||||||||
Weighted-average
fair value estimates at grant date:
|
||||||||||||
In
thousands
|
$ | 6,820 | $ | 5,542 | $ | 5,192 | ||||||
Fair
value per share
|
$ | 8.54 | $ | 9.95 | $ | 8.08 |
Number
of Options |
Weighted average
exercise |
Weighted average |
Aggregate Intrinsic
Value |
|||||||||
(In
Thousands, Except Exercise Price and Contractual Term)
|
||||||||||||
Outstanding
at December 31, 2007
|
2,674 | $ | 26.39 | |||||||||
Granted
|
799 | 19.64 | ||||||||||
Exercised
|
(787 | ) | 20.99 | |||||||||
Forfeited/expired
|
(73 | ) | 31.76 | |||||||||
Outstanding
at December 31, 2008
|
2,613 | $ | 25.81 |
7.9
|
$ |
382
|
||||||
Exercisable
at December 31, 2008
|
1,375 | $ | 28.00 |
6.6
|
$ |
382
|
Weighted
average
|
||||||||
grant
date
|
||||||||
(Shares
In Thousands)
|
Shares
|
fair
value
|
||||||
Unvested
at December 31, 2007
|
515 | $ | 28.64 | |||||
Granted
|
344 | $ | 22.21 | |||||
Vested
|
(232 | ) | $ | 28.97 | ||||
Forfeited
|
(32 | ) | $ | 29.12 | ||||
Unvested
at December 31, 2008
|
595 | $ | 24.76 |
For
the years ended December 31,
|
||||||||
2008
|
2007
|
|||||||
Awarded
|
399,687 | 310,900 | ||||||
Settled
|
131,981 | 81,461 | ||||||
Settlement
amount (in millions)
|
$ | 2.4 | $ | 2.3 |
Capital
Leases
|
Operating
Leases
|
|||||||
(In
Thousands)
|
||||||||
2009
|
$ | 2,285 | $ | 71,237 | ||||
2010
|
2,412 | 70,150 | ||||||
2011
|
2,670 | 56,527 | ||||||
2012
|
13 | 46,177 | ||||||
2013
|
12 | 29,654 | ||||||
Beyond
2013
|
23 | 18,850 | ||||||
Total
minimum lease payments
|
7,415 | $ | 292,595 | |||||
Less
imputed interest
|
503 | |||||||
Present
value of minimum capital lease payments
|
$ | 6,912 |
For
the years ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Utility
coal
|
53 | % | 60 | % | 62 | % | ||||||
Metallurgical
coal
|
37 | % | 30 | % | 28 | % | ||||||
Industrial
coal
|
10 | % | 10 | % | 10 | % |
|
•
|
Level
1 – Inputs are unadjusted, quoted prices in active markets for identical
assets or liabilities at the measurement
date.
|
|
•
|
Level
2 – Inputs (other than quoted prices included in Level 1) are either
directly or indirectly observable for the assets or liability through
correlation with market data at the measurement date and for the duration
of the instrument’s anticipated
life.
|
|
•
|
Level
3 – Inputs reflect management’s best estimate of what market participants
would use in pricing the asset or liability at the measurement
date. Consideration is given to the risk inherent in the
valuation technique and the risk inherent in the inputs to the
model.
|
December
31, 2008
|
||||||||||||||||
(In
Thousands)
|
||||||||||||||||
Level
1
|
Level
2
|
Level
3
|
Total
|
|||||||||||||
Fixed
income securities
|
$ | 13,039 | $ | - | $ | - | $ | 13,039 | ||||||||
Money
market funds
|
616,118 | - | - | 616,118 | ||||||||||||
Short-term
investment
|
- | - | 39,383 | 39,383 | ||||||||||||
Derivative
instruments
|
- | 22,552 | - | 22,552 | ||||||||||||
Total
securities
|
$ | 629,157 | $ | 22,552 | $ | 39,383 | $ | 691,092 |
Short-term
|
||||
(In
Thousands)
|
Investments
|
|||
Balance
at December 31, 2007
|
$ | - | ||
Transfers
in (out) of Level 3, net
|
45,920 | |||
Change
in fair value included in earnings
|
(6,537 | ) | ||
Balance
at December 31, 2008
|
$ | 39,383 | ||
Losses
included in earnings attributable to the change in
unrealized
|
||||
losses
relating to assets still held at December 31, 2008
|
$ | (6,537 | ) |
|
Harman
|
|
West
Virginia Flooding
|
Three
Months Ended
|
||||||||||||||||
March
31, 2008 (1)
|
June
30, 2008 (2)
|
September
30, 2008 (3)
|
December
31, 2008 (4)
|
|||||||||||||
(In
Thousands, Except Per Share Amounts)
|
||||||||||||||||
Total
revenue
|
$ | 644,625 | $ | 826,838 | $ | 763,296 | $ | 755,030 | ||||||||
Income
(loss) before interest and taxes
|
68,975 | (108,574 | ) | 93,490 | 79,331 | |||||||||||
Income
(loss) before taxes
|
53,239 | (125,794 | ) | 64,782 | 68,106 | |||||||||||
Net
income (loss)
|
41,934 | (93,338 | ) | 54,026 | 53,626 | |||||||||||
Net
income (loss) per share:
|
||||||||||||||||
Basic
|
$ | 0.53 | $ | (1.16 | ) | $ | 0.65 | $ | 0.63 | |||||||
Diluted
|
$ | 0.52 | $ | (1.16 | ) | $ | 0.64 | $ | 0.63 | |||||||
Three
Months Ended
|
||||||||||||||||
March
31, 2007
|
June
30, 2007 (5)
|
September
30, 2007
|
December
31, 2007
(6)
|
|||||||||||||
(In
Thousands, Except Per Share Amounts)
|
||||||||||||||||
Total
revenue
|
$ | 607,320 | $ | 617,802 | $ | 603,441 | $ | 584,960 | ||||||||
Income
before interest and taxes
|
55,557 | 60,127 | 35,343 | 28,652 | ||||||||||||
Income
before taxes
|
39,531 | 45,316 | 20,478 | 24,178 | ||||||||||||
Net
income
|
32,607 | 34,938 | 21,408 | 5,145 | ||||||||||||
Net
income per share (basic and diluted)
|
$ | 0.40 | $ | 0.43 | $ | 0.27 | $ | 0.06 |
(1)
|
Income
for the first quarter of 2008 includes a $13.6 million pre tax gain on the
exchange of coal reserves.
|
(2)
|
Loss
for the second quarter of 2008 includes $245.3 million pre tax expense
related to the Wheeling-Pittsburgh lawsuit (see Note 18 for further
information) and a $15.3 million pre tax gain on the exchange of coal
reserves.
|
(3)
|
Income
for the third quarter of 2008 includes $5.8 million pre tax expense
related to the Wheeling-Pittsburgh lawsuit (see Note 18 for further
information), $9.1 million pre tax loss on financing transaction related
to fees incurred for the tender offer for our 6.625% Notes (see Note 6 for
further information), $3.6 million pre tax gain on the exchange of coal
reserves and other assets, and a $6.5 million pre tax loss on short-term
investment reflecting an impairment of our investment in the Primary Fund
(see Note 16 for further
information).
|
(4)
|
Income
for the fourth quarter of 2008 includes $12.9 million pre tax income
related to federal legislation passed that authorized refunds of black
lung excise taxes paid in years that had been statutorily closed, $8.6
million pre tax gain on financing transaction from the purchase of $19.0
million of our 3.25% Notes on the open market (see Note 6 for further
information), and a $22.6 million non-cash loss on the net change of
derivative instruments.
|
(5)
|
Income
for the second quarter of 2007 includes $5.0 million non-tax deductible
expense related to the settlement of a lawsuit filed by the Environmental
Protection Agency (“EPA lawsuit”) and a $10.3 million pre-tax gain on the
exchange of coal reserves.
|
(6)
|
Income
for the fourth quarter of 2007 includes $22.0 million reversal of the
accrual and $11.6 million reversal of accrued interest for the Harman
lawsuit (see Note 18 for further information), $15 million non-tax
deductible expense related to the settlement of the EPA lawsuit, and a
$6.7 million pre-tax gain on the sale of a mineral rights
override.
|
|
•
|
Information
regarding the directors required by this item is found under the heading
Election of
Directors.
|
|
•
|
Information
regarding Massey’s Audit Committee required by this item is found under
the heading Committees
of the Board.
|
|
•
|
Information
regarding Section 16(a) Beneficial Ownership Reporting Compliance required
by this item is found under the heading Section 16(a) Beneficial
Ownership Reporting
Compliance.
|
|
•
|
Information
regarding Massey’s Code of Ethics required by this item is found under the
heading Code of
Ethics.
|
Plan
Category
|
(a)
Number of securities to be issued upon exercise of outstanding options,
warrants and rights (1),
(2)
|
(b)
Weighted-average per share exercise price of outstanding options, warrants
and rights (2)
|
(c)
Number of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
|
|||||||||
Equity
compensation plans approved by
|
||||||||||||
shareholders
|
2,612,517 | $ | 25.81 | 1,362,752 | ||||||||
Equity
compensation plans not approved by
|
||||||||||||
shareholders
(3)
|
- | - | - | |||||||||
Total
|
2,612,517 | $ | 25.81 | 1,362,752 |
(1)
|
There
are no outstanding warrants or
rights.
|
(2)
|
These
amounts do not include shares to be issued upon vesting of restricted
stock because they have no exercise
price.
|
(3)
|
We
do not have any equity compensation plans that have not been approved by
our shareholders.
|
(a)
|
Documents
filed as part of this report:
|
1.Financial
Reports:
|
||
Consolidated
Statements of Income for the Fiscal Years Ended December 31, 2008, 2007
and 2006
|
||
Consolidated
Balance Sheets at December 31, 2008 and 2007
|
||
Consolidated
Statements of Cash Flows for the Fiscal Years Ended December 31, 2008,
2007, and 2006
|
||
Consolidated
Statements of Shareholders’ Equity for the Fiscal Years Ended December 31,
2008, 2007, and 2006
|
||
Notes
to Consolidated Financial Statements
|
||
2.Financial
Statement Schedules: Except as set forth below, all schedules have been
omitted since the required information is not present or not present in
amounts sufficient to require submission of the schedule, or because the
information required is included in the Consolidated Financial Statements
and Notes thereto.
|
||
Schedule
II—Valuation and Qualifying Accounts
|
||
3.Exhibits:
|
Exhibit
No.
|
Description
|
|
3.1
|
Certificate
of Ownership and Merger merging Massey Energy Company with and into Fluor
Corporation accompanied by Restated Certificate of Incorporation of Massey
Energy Company, as amended [filed as Exhibit 3.1 to Massey’s annual report
on Form 10-K for the fiscal year ended October 31, 2000 and incorporated
by reference]
|
|
3.2
|
Restated
Bylaws (as amended as of November 10, 2008) of Massey Energy Company
[filed as Exhibit 3.2 to Massey’s current report on Form 8-K filed
November 14, 2008 and incorporated by reference]
|
|
4.1
|
Senior
Indenture, dated May 29, 2003, by and among Massey Energy Company,
subsidiaries of Massey Energy Company, as Guarantors and Wilmington Trust
Company, as Trustee, in connection with the Company’s 4.75% Convertible
Senior Notes [filed as Exhibit 4.1 to Massey’s current report on Form 8-K
filed May 30, 2003 and incorporated by reference]
|
|
4.2
|
First
Supplemental Indenture, dated May 29, 2003, by and among Massey Energy
Company, subsidiaries of Massey Energy Company, as Guarantors, and
Wilmington Trust Company, as Trustee, supplementing that certain Senior
Indenture dated May 29, 2003, in connection with the Company’s 4.75%
Convertible Senior Notes [filed as Exhibit 4.2 to Massey’s current report
on Form 8-K filed May 30, 2003 and incorporated by
reference]
|
|
4.3
|
Indenture,
dated November 10, 2003, by and among Massey Energy Company, subsidiaries
of Massey Energy Company, as Guarantors, and Wilmington Trust Company, as
Trustee, in connection with the Company’s 6.625% Senior Notes [filed as
Exhibit 4.1 to Massey’s current report on Form 8-K filed November 12, 2003
and incorporated by reference]
|
|
4.4
|
First
Supplemental Indenture, dated August 19, 2008, by and among Massey Energy
Company, subsidiaries of Massey Energy Company, as Guarantors, and
Wilmington Trust Company, as Trustee, in connection with the Company’s
6.625% Senior Notes [filed as Exhibit 4.1 to Massey’s current report on
Form 8-K filed August 22, 2008 and incorporated by
reference]
|
|
4.5
|
Second
Supplemental Indenture, dated April 7, 2004, by and among Massey Energy
Company, subsidiaries of Massey Energy Company, as Guarantors, and
Wilmington Trust Company, as Trustee, supplementing that certain Senior
Indenture dated May 29, 2003, in connection with the Company’s 2.25%
Convertible Senior Notes [filed as Exhibit 4.1 to Massey’s current report
on Form 8-K filed April 4, 2004 and incorporated by
reference]
|
|
4.6
|
Indenture,
dated as of December 21, 2005, by and among Massey Energy
Company, subsidiaries of Massey Energy Company, as Guarantors, and
Wilmington Trust Company, as Trustee, in connection with the Company’s
6.875% Senior Notes [filed as Exhibit 4.1 to Massey’s current report on
Form 8-K filed December 21, 2005, and incorporated by
reference]
|
Exhibit
No.
|
Description
|
|
4.7
|
Senior
Indenture, dated as of August 12, 2008, by and among Massey Energy
Company, subsidiaries of Massey Energy Company, as Guarantors, and
Wilmington Trust Company, as Trustee, in connection with the Company’s
3.25% Senior Notes [filed as Exhibit 4.1 to Massey’s current report on
Form 8-K filed August 12, 2008, and incorporated by
reference]
|
|
4.8
|
First
Supplemental Indenture, dated as of August 12, 2008, by and
among Massey Energy Company, subsidiaries of Massey Energy Company, as
Guarantors, and Wilmington Trust Company, as Trustee, in connection with
the Company’s 3.25% Senior Notes [filed as Exhibit 4.2 to Massey’s current
report on Form 8–K filed August 12, 2008, and incorporated by
reference]
|
|
10.1
|
Amended
and Restated Credit Agreement dated as of August 15, 2006, among A. T.
Massey Coal Company, Inc. and certain of its subsidiaries, as Borrowers,
Massey Energy Company and certain of its subsidiaries, as Guarantors, Bank
of America, N. A., as Syndication Agent, General Electric Capital
Corporation, as Documentation Agent, The CIT Group/Business Credit, Inc.,
as Collateral Agent, UBS Securities LLC, as Arranger, UBS AG, Stamford
Branch, as Administrative Agent, and UBS Loan Finance LLC, as Swingline
Lender, and the lenders party thereto [filed as Exhibit 10.6 to Massey’s
current report on Form 8-K filed August 18, 2006 and incorporated by
reference]
|
|
10.2
|
First
Amendment to Amended and Restated Credit Agreement dated March 12, 2007
[filed as Exhibit 10.1 to Massey’s quarterly report on Form 10-Q filed May
10, 2007 and incorporated by reference]
|
|
10.3
|
Limited
Consent and Second Amendment to Amended and Restated Credit Agreement
dated July 19, 2007 [filed as Exhibit 10.1 to Massey’s quarterly report on
Form 10-Q filed August 9, 2007 and incorporated by
reference]
|
|
10.4
|
Third
Amendment to Amended and Restated Credit Agreement dated March 10, 2008
[filed as Exhibit 10.1 to Massey’s current report on Form 8-K filed March
14, 2008 and incorporated by reference]
|
|
10.5
|
Fourth
Amendment to Amended and Restated Credit Agreement dated October 10, 2008
[filed as Exhibit 10.1 to Massey’s current report on Form 8-K filed
October 16, 2008 and incorporated by reference]
|
|
10.6
|
Equity
Distribution Agreement dated February 3, 2009 between Massey Energy
Company and UBS Securities LLC [filed as Exhibit 1.1 to Massey’s current
report on Form 8-K filed February 4, 2009 and incorporated by
reference]
|
|
10.7
|
Massey
Energy Company 1982 Shadow Stock Plan (as amended and restated effective
November 30, 2000) [filed as Exhibit 10.8 to Massey’s annual report on
Form 10-K for the fiscal year ended October 31, 2000 and incorporated by
reference]
|
|
10.8
|
Massey
Energy Company 1988 Executive Stock Plan (as amended and restated
effective November 30, 2000) [filed as Exhibit 10.6 to Massey’s annual
report on Form 10-K for the fiscal year ended October 31, 2000 and
incorporated by reference]
|
|
10.9
|
Massey
Energy Company 1996 Executive Stock Plan (as amended and restated,
effective January 1, 2009) [filed as Exhibit 10.14 to Massey’s current
report on Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.10
|
Massey
Energy Company 1997 Stock Appreciation Rights Plan (as amended and
restated, effective November 30, 2000) [filed as Exhibit 10.9 to Massey’s
annual report on Form 10-K for the fiscal year ended October 31, 2000 and
incorporated by reference]
|
|
10.11
|
Massey
Energy Company 1999 Executive Performance Incentive Plan (as amended and
restated, effective January 1, 2009) [filed as Exhibit 10.15 to Massey’s
current report on Form 8-K filed December 24, 2008 and
incorporated by reference]
|
|
10.12
|
Massey
Energy Company 2006 Stock and Incentive Compensation Plan (as amended and
restated, effective January 1, 2009) [filed as Exhibit 10.16 to Massey’s
current report on Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.13
|
Form
of Non-Employee Director Initial Restricted Stock Award Agreement under
the Massey Energy Company 2006 Stock and Incentive Compensation Plan
[filed as Exhibit 10.2 to Massey’s current report on Form 8-K filed
December 24, 2008 and incorporated by reference]
|
|
10.14
|
Form
of Non-Employee Director Initial Restricted Unit Award Agreement under the
Massey Energy Company 2006 Stock and Incentive Compensation Plan [filed as
Exhibit 10.3 to Massey’s current report on Form 8-K filed December 24,
2008 and incorporated by reference]
|
|
10.15
|
Form
of Non-Employee Director Annual Restricted Stock Award Agreement under the
Massey Energy Company 2006 Stock and Incentive Compensation Plan [filed as
Exhibit 10.4 to Massey’s current report on Form 8-K filed December 24,
2008 and incorporated by reference]
|
|
10.16
|
Form
of Non-Employee Director Annual Stock Option Award Agreement under the
Massey Energy Company 2006 Stock and Incentive Compensation Plan [filed as
Exhibit 10.2 to Massey’s current report on Form 8-K filed February 23,
2009 and incorporated by
reference]
|
Exhibit
No.
|
Description
|
|
10.17
|
Form
of stock option agreement under the Massey Energy Company 2006 Stock and
Incentive Compensation Plan [filed as Exhibit 10.3 to Massey’s current
report on Form 8-K filed November 14, 2008 and incorporated by
reference]
|
|
10.18
|
Form
of restricted stock agreement under the Massey Energy Company 2006 Stock
and Incentive Compensation Plan [filed as Exhibit 10.4 to Massey’s current
report on Form 8-K filed November 14, 2008 and incorporated by
reference]
|
|
10.19
|
Form
of restricted unit agreement under the Massey Energy Company 2006 Stock
and Incentive Compensation Plan [filed as Exhibit 10.5 to Massey’s current
report on Form 8-K filed November 14, 2008 and incorporated by
reference]
|
|
10.20
|
Form
of cash incentive award agreement based on earnings before taxes under the
Massey Energy Company 2006 Stock and Incentive Compensation Plan [filed as
Exhibit 10.6 to Massey’s current report on Form 8-K filed November 14,
2008 and incorporated by reference]
|
|
10.21
|
Form
of cash incentive award agreement based on earnings before interest,
taxes, deprecation and amortization under the Massey Energy Company 2006
Stock and Incentive Compensation Plan [filed as Exhibit 10.7 to Massey’s
current report on Form 8-K filed November 14, 2008 and incorporated by
reference]
|
|
10.22
|
Form
of Additional Stock Option Grant Agreement [filed as Exhibit 10.3 to
Massey’s current report on Form 8-K filed February 23, 2009 and
incorporated by reference]
|
|
10.23
|
A.T.
Massey Coal Company, Inc. Supplemental Benefit Plan (as amended and
restated as of January 1, 2009) [filed as Exhibit 10.20 to Massey’s
current report on Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.24
|
Massey
Executive Deferred Compensation Program (as amended and restated as of
January 1, 2009) [filed as Exhibit 10.17 to Massey’s current report on
Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.25
|
A.T.
Massey Coal Company, Inc. Executive Deferred Compensation Plan (as amended
and restated as of January 1, 2009) [filed as Exhibit 10.19 to Massey’s
current report on Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.26
|
Massey
Energy Company Executive Physical Program [filed as Exhibit 10.3 to
Massey’s annual report on Form 10-K for the fiscal year ended October 31,
2000 and incorporated by reference]
|
|
10.27
|
Massey
Executives’ Supplemental Benefit Plan (as amended and restated effective
January 1, 2009) [filed as Exhibit 10.13 to Massey’s current report on
Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.28
|
Massey
Executives’ Supplemental Benefit Plan Agreement (effective as of January
1, 2005) between Massey and Don L. Blankenship [filed as Exhibit 10.2 to
Massey’s current report on Form 8-K filed January 5, 2006 and incorporated
by reference]
|
|
10.29
|
Letter
Agreement dated November 13, 2007, between Massey Energy Company and Don
L. Blankenship [filed as Exhibit 10.32 to Massey’s annual report on Form
10-K filed February 29, 2008 and incorporated by
reference]
|
|
10.30
|
Letter
Agreement,
dated December 23, 2008, amending and restating Appendix A to the Letter
Agreement, originally dated November 13, 2007, as amended and
restated effective January 1, 2009, between Massey Energy Company and Don
L. Blankenship [filed as Exhibit 10.11 to Massey’s current report on Form
8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.31
|
Retention
and Employment Agreement as amended and restated, effective January 1,
2009, between Massey Energy Company and John Christopher Adkins [filed as
Exhibit 10.10 to Massey’s current report on Form 8-K filed December 24,
2008 and incorporated by reference]
|
|
10.32
|
Employment
Agreement as amended and restated, effective January 1, 2009 between
Massey Energy Company and Michael K. Snelling [filed as Exhibit 10.12 to
Massey’s current report on Form 8-K filed December 24, 2008 and
incorporated by reference]
|
|
10.33
|
Special
Successor and Development Retention Program between Fluor Corporation and
Don L. Blankenship dated as of September 1998 [filed as Exhibit 10.21 to
Fluor’s annual report on Form 10-K for the fiscal year ended October 31,
1998 and incorporated by reference]
|
|
10.34
|
Amendment
to Special Successor and Development Retention Program between Massey
(formerly Fluor Corporation) and Don L. Blankenship, effective January 1,
2009 [filed as Exhibit 10.23 to Massey’s current report on Form 8-K filed
December 24, 2008]
|
|
10.35
|
Employment
and Change in Control Agreement dated November 10, 2008 between Massey
Energy Company and Baxter F. Phillips, Jr. [filed as Exhibit 10.2 to
Massey’s current report on Form 8-K filed November 14, 2008 and
incorporated by reference]
|
Exhibit
No.
|
Description
|
|
10.36
|
Form
of Change in Control Severance Agreement for Tier 1 Participants [filed
herewith]
|
|
10.37
|
Form
of Change in Control Severance Agreement for Tier 2 Participants [filed
herewith]
|
|
10.38
|
Form
of Change in Control Severance Agreement for Tier 3 Participants [filed
herewith]
|
|
10.39
|
Change
in Control Severance Agreement (as amended and restated) dated as of
December 23, 2008 between Massey Energy Company and Don L. Blankenship
[filed as Exhibit 10.24 to Massey’s current report on Form 8-K filed
December 24, 2008 and incorporated by reference]
|
|
10.40
|
Change
in Control Severance Agreement (as amended and restated) dated as of
December 23, 2008 between Massey Energy Company and J. Christopher Adkins
[filed as Exhibit 10.25 to Massey’s current report on Form 8-K filed
December 24, 2008 and incorporated by reference]
|
|
10.41
|
Change
in Control Severance Agreement (as amended and restated) dated as of
December 23, 2008 between Massey Energy Company and Eric B. Tolbert [filed
as Exhibit 10.26 to Massey’s current report on Form 8-K filed December 24,
2008 and incorporated by reference]
|
|
10.42
|
Change
in Control Severance Agreement (as amended and restated) dated as of
December 23, 2008 between Massey Energy Company and Michael K. Snelling
[filed as Exhibit 10.27 to Massey’s current report on Form 8-K filed
December 24, 2008 and incorporated by reference]
|
|
10.43
|
Massey
Energy Company 2008 Long Term Incentive Award Program as reported on
Massey’s current report on Form 8-K [filed November 14, 2008 and
incorporated by reference]
|
|
10.44
|
Massey
Energy Company 2009 Bonus Program as reported on Massey’s current report
on Form 8-K [filed November 14, 2008 and incorporated by
reference]
|
|
10.45
|
Base
salary amounts set for Massey’s named executive officers as reported on
Massey’s current report on Form 8-K [filed November 14, 2008 and
incorporated by reference]
|
|
10.46
|
Massey
Energy Company Non-Employee Directors
Compensation Summary (as amended and restated effective February
17, 2009) [filed as Exhibit 10.1 to Massey’s current report on Form 8-K
filed February 23, 2009 and incorporated by reference]
|
|
10.47
|
Massey
Energy Company Stock Plan for Non-Employee Directors (as amended and
restated, effective January 1, 2009) [filed as Exhibit 10.21 to Massey’s
current report on Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.48
|
Massey
Energy Company 1997 Restricted Stock Plan for Non-Employee Directors (as
amended and restated, effective January 1, 2009) [filed as Exhibit 10.22
to Massey’s current report on Form 8-K filed December 24, 2008 and
incorporated by reference]
|
|
10.49
|
Massey
Energy Company Deferred Directors’ Fees Program (amended and restated,
effective January 1, 2009) [filed as Exhibit 10.18 to Massey’s current
report on Form 8-K filed December 24, 2008 and incorporated by
reference]
|
|
10.50
|
Distribution
Agreement between Fluor Corporation and Massey Energy Company dated as of
November 30, 2000 [filed as Exhibit 10.1 to Massey’s current report on
Form 8-K filed December 15, 2000 and incorporated by this
reference]
|
|
10.51
|
Tax
Sharing Agreement between Fluor Corporation, Massey Energy Company and
A.T. Massey Coal Company, Inc. dated as of November 30, 2000 [filed as
Exhibit 10.2 to Massey’s current report on Form 8-K filed December 15,
2000 and incorporated by this reference]
|
|
16.1
|
Letter
from Arnett and Foster to the Securities and Exchange Commission, dated
November 16, 2007 [filed as Exhibit 16.1 to Massey’s current report on
Form 8-K filed November 17, 2007 and incorporated by
reference]
|
|
21
|
Massey
Energy Company Subsidiaries [filed herewith]
|
|
23.1
|
Consent
of Independent Registered Public Accounting Firm [filed
herewith]
|
|
24
|
Manually
signed Powers of Attorney executed by Massey directors [filed
herewith]
|
|
31.1
|
Certification
of Chief Executive Officer, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 [filed herewith]
|
|
31.2
|
Certification
of Chief Financial Officer, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 [filed herewith]
|
|
32.1
|
Certification
of Chief Executive Officer pursuant to 18 U.S.C., Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 [furnished
herewith]
|
|
32.2
|
Certification
of Chief Financial Officer pursuant to 18 U.S.C., Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 [furnished
herewith]
|
MASSEY
ENERGY COMPANY
|
||||
February
27, 2009
|
||||
By:
|
/s/ ERIC B. TOLBERT
|
|||
Eric
B. Tolbert,
|
||||
Vice
President and Chief Financial
Officer
|
Signature
|
Title
|
Date
|
Principal
Executive Officer and Director:
|
||
/s/ DON L. BLANKENSHIP
|
Chairman
and Chief Executive Officer
|
February
27, 2009
|
Don
L. Blankenship
|
||
Principal
Financial Officer:
|
||
/s/ ERIC B. TOLBERT
|
Vice
President and Chief Financial Officer
|
February
27, 2009
|
Eric
B. Tolbert
|
||
Principal
Accounting Officer:
|
||
/s/ DAVID W. OWINGS
|
Controller
|
February
27, 2009
|
David
W. Owings
|
||
Other
Directors:
|
||
*
|
Director
|
February
27, 2009
|
James
B. Crawford
|
||
*
|
Director
|
February
27, 2009
|
Robert
H. Foglesong
|
||
*
|
Director
|
February
27, 2009
|
Richard
M. Gabrys
|
||
*
|
Director
|
February
27, 2009
|
E.
Gordon Gee
|
||
*
|
Director
|
February
27, 2009
|
Bobby
R. Inman
|
||
*
|
Director
|
February
27, 2009
|
Lady
Judge
|
||
*
|
Director
|
February
27, 2009
|
Dan
R. Moore
|
||
*
|
Director
and President
|
February
27, 2009
|
Baxter
F. Phillips, Jr.
|
||
*
|
|
|
Stanley
C. Suboleski
|
Director
|
February
27,
2009
|
By:
|
/s/ RICHARD R. GRINNAN
|
February
27, 2009
|
||
Richard
R. Grinnan
|
||||
Attorney-in-fact
|
*
|
Manually
signed Powers of Attorney authorizing Eric B. Tolbert., Richard R. Grinnan
and Jeffrey M. Jarosinski, and each of them, to sign the annual report on
Form 10-K for the fiscal year ended December 31, 2008 and any amendments
thereto as attorneys-in-fact for certain directors and officers of the
registrant are included herein as Exhibits
24.
|
Description
|
Balance
at Beginning of Period
|
Amounts
Charged to Costs and Expenses
|
Deductions
(1)
|
Other
|
Balance
at End of Period
|
|||||||||||||||
YEAR
ENDED DECEMBER 31, 2008
|
||||||||||||||||||||
Reserves
deducted from asset accounts:
|
||||||||||||||||||||
Allowance
for accounts and notes
|
||||||||||||||||||||
receivable
|
$ | 444 | $ | 429 | $ | - | $ | - | $ | 873 | ||||||||||
YEAR
ENDED DECEMBER 31, 2007
|
||||||||||||||||||||
Reserves
deducted from asset accounts:
|
||||||||||||||||||||
Allowance
for accounts and notes
|
||||||||||||||||||||
receivable
|
$ | 576 | $ | (132 | ) | $ | - | $ | - | $ | 444 | |||||||||
YEAR
ENDED DECEMBER 31, 2006
|
||||||||||||||||||||
Reserves
deducted from asset accounts:
|
||||||||||||||||||||
Allowance
for accounts and notes
|
||||||||||||||||||||
receivable
|
$ | 2,063 | $ | 12 | $ | (1,499 | ) | $ | - | $ | 576 |
(1)
|
Reserves
utilized, unless otherwise
indicated.
|