BRISTOL, Va. - Alpha Natural Resources Inc. says its losses narrowed and it posted better-than-expected earnings for the third quarter as the coal industry struggles with anemic demand.
The Bristol, Va.-based company said Friday it lost $46.1 million, or 21 cents per share. That compares with a year-earlier quarterly profit of $62.6 million, or 28 cents per share.
Revenue fell 29 percent to $1.63 billion.
Analysts polled by FactSet expected a loss of 45 cents per share with revenue of $1.69 billion.
Alpha Natural Resources and other coal producers are being hit by a double whammy of weak demand. Utilities need less coal to produce electricity because of mild weather and lower power generation, while construction overseas has slowed the appetite for coal to make steel.
"Market conditions for both metallurgical and thermal coal have been challenging throughout much of 2012," CEO Kevin Crutchfield said in a statement. "In the face of these market headwinds, Alpha has taken swift and decisive actions to right-size our operational footprint and our cost structure."
That includes slowing production to get more in line with demand as prices continue to fall and the slashing of about 1,200 jobs. The restructuring started in September and is expected to save $150 million a year once they're complete.
Alpha Natural Resources' $7.1 billion takeover of Richmond, Va.-based Massey in June 2011 made it the world's third-largest producer of metallurgical coal, a key fuel for manufacturing steel. It also supplies thermal coal to electric utilities and manufacturing industries. It has more than 180 mines and processing plants in Kentucky, Pennsylvania, Virginia, West Virginia and Wyoming.
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