Alliance Resource Partners Reports Strong Q2 Earnings Amid Improved Coal Volumes and Royalty Performance
Alliance Resource Partners (NASDAQ:ARLP) reported a strong second-quarter performance in fiscal year 2026, with net income rising by 33.9% to $79.6 million compared to the prior-year period. Revenue increased to $551.6 million and adjusted EBITDA grew 14.7% to $185.7 million. The results were driven by higher coal sales volumes, lower operating costs, record oil and gas royalty income, and stronger investment returns, despite a decline in average coal pricing. The company maintained its full-year guidance for 2026 and added new coal sales commitments of 21.2 million tons. Management also highlighted the expected return to full operations at Hamilton mine, which could support higher production later this year and potentially add up to 1.3 million tons in sales by 2027. Additionally, ARLP's acquisition of AllDale Minerals for $206.2 million is projected to boost distributable cash flow per unit by 8% to 9% next year. Coal volumes rose both sequentially and annually, with production reaching 8.2 million tons in the quarter. While average coal prices declined due to expiring legacy contracts at Tunnel Ridge mine, cost improvements helped offset this pressure. The partnership generated $108.2 million in distributable cash flow during Q2, achieving a distribution coverage ratio of 1.39 times.
Topics: acquisitions coal ebitda energy royalties