SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 26, 2000
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P&L COAL HOLDINGS CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 333-59073 13-4004153
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(State or other jurisdiction of (Commission File (I.R.S. Employer
incorporation or organization) Number) Identification No.)
701 Market Street, St. Louis, Missouri 63101
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 342-3400
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N/A
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(Former name, former address and former fiscal year, if changed since last
report)
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On December 26, 2000, P&L Coal Holdings Corporation (the "Company") signed
a share purchase agreement for the transfer of the stock in two U.K. holding
companies which, in turn, own the Company's Australian subsidiaries to Coal &
Allied Industries Limited ("Coal & Allied"), a 71%-owned subsidiary of Rio
Tinto. The Company's Australian subsidiaries are comprised of interests in six
coal mines, as well as Mining Services in Brisbane, Australia. The coal mines
are Bengalla, Warkworth, Ravensworth, Ravensworth East and Narama in New South
Wales, and Moura in Queensland, Australia.
The sale price is approximately $455 million in cash, subject to
post-closing adjustments. The Company anticipates the sale will close in January
2001. Under the terms of the agreement, Coal & Allied will obtain ownership of
all assets and assume all liabilities of the Company's Australian subsidiaries.
The sale price was determined based on arms length negotiations between the
parties. The Company intends to use $400 million of the proceeds from the sale
to repay a portion of its Senior Credit Facility. The remaining net proceeds
will be used for future capital expenditures or investments.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(b) Unaudited Pro Forma Condensed Financial Information of P&L Coal
Holdings Corporation for the year ended March 31, 2000, for the six
months ended and as of September 30, 2000, and the notes thereto.
(c) Exhibits
2.1 Share Purchase Agreement, dated as of December 26, 2000, between P&L Coal
Holdings Corporation, Gold Fields Mining Corporation and Coal & Allied
Industries Limited
UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION
On December 26, 2000, the Company signed a share purchase agreement for the
transfer of the stock in two U.K. holding companies which, in turn, own the
Company's Australian subsidiaries to Coal & Allied Industries Limited, a
71%-owned subsidiary of Rio Tinto. The sale price is approximately $455 million
in cash, subject to post-closing adjustments.
The following Unaudited Pro Forma Condensed Financial Statements are based
on the historical presentation of the consolidated financial statements of P&L
Coal Holdings Corporation. The Unaudited Pro Forma Condensed Statements of
Operations for the year ended March 31, 2000 and the six months ended September
30, 2000 give effect to the sale of the Company's Australian subsidiaries
("Peabody Resources Limited") as if it had occurred on April 1, 1999. However,
the gain on the sale of Peabody Resources Limited has not been included in the
statements of operations for the periods presented. The Unaudited Pro Forma
Condensed Balance Sheet as of September 30, 2000 gives effect to the sale of
Peabody Resources Limited as if it had occurred on September 30, 2000.
The Unaudited Pro Forma Condensed Financial Statements do not purport to be
indicative of the results that actually would have been obtained during the
periods presented and they are not necessarily indicative of operating results
to be expected in future periods. The Unaudited Pro Forma Condensed Financial
Statements and notes thereto should be read in conjunction with the audited
historical consolidated financial statements and notes thereto of the Company.
For additional information, the reader may wish to refer to the Company's
Annual Report on Form 10-K for the fiscal year ended March 31, 2000, and the
Quarterly Report on Form 10-Q for the period ended September 30, 2000.
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<TABLE>
P&L COAL HOLDINGS CORPORATION
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
YEAR ENDED MARCH 31, 2000
(In thousands)
Peabody Resources Pro Forma
Historical Limited<F1> Adjustments Pro Forma
---------------- ------------------ --------------- ----------------
<S> <C> <C> <C> <C>
REVENUES
Sales $ 2,610,991 $ (214,786) $ - $ 2,396,205
Other revenues 99,509 (29,561) - 69,948
---------------- ------------------ --------------- ----------------
Total revenues 2,710,500 (244,347) - 2,466,153
COSTS AND EXPENSES
Operating costs and expenses 2,178,664 (157,685) - 2,020,979
Depreciation, depletion and amortization 249,782 (33,455) - 216,327
Selling and administrative expenses 95,256 (4,784) - 90,472
Net gain on property and equipment disposals (6,439) (68) - (6,507)
---------------- ------------------ --------------- ----------------
OPERATING PROFIT 193,237 (48,355) - 144,882
Interest expense 205,056 (6,828) (30,625)<F2> 167,603
Interest income (4,421) 625 - (3,796)
---------------- ------------------ --------------- ----------------
LOSS BEFORE INCOME TAXES AND MINORITY INTERESTS (7,398) (42,152) 30,625 (18,925)
Income tax benefit (141,522) (12,187) 7,656 <F3> (146,053)
Minority interests 15,554 - - 15,554
---------------- ------------------ --------------- ----------------
INCOME FROM CONTINUING OPERATIONS $ 118,570 $ (29,965) $ 22,969 $ 111,574
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</TABLE>
See accompanying notes to unaudited pro forma condensed financial statements.
<PAGE>
<TABLE>
P&L COAL HOLDINGS CORPORATION
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
SIX MONTHS ENDED SEPTEMBER 30, 2000
(In thousands)
Peabody Resources Pro Forma
Historical Limited<F1> Adjustments Pro Forma
---------------- ------------------ --------------- ----------------
<S> <C> <C> <C> <C>
REVENUES
Sales $ 1,312,817 $ (116,857) $ - $ 1,195,960
Other revenues 37,795 (25,170) - 12,625
---------------- ------------------ --------------- ----------------
Total revenues 1,350,612 (142,027) - 1,208,585
COSTS AND EXPENSES
Operating costs and expenses 1,108,963 (100,370) - 1,008,593
Depreciation, depletion and amortization 121,276 (15,970) - 105,306
Selling and administrative expenses 43,429 (684) - 42,745
Net gain on property and equipment disposals (3,373) 473 - (2,900)
---------------- ------------------ --------------- ----------------
OPERATING PROFIT 80,317 (25,476) - 54,841
Interest expense 102,926 (3,799) (16,550)<F2> 82,577
Interest income (5,754) 241 - (5,513)
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LOSS BEFORE INCOME TAXES AND MINORITY INTERESTS (16,855) (21,918) 16,550 (22,223)
Income tax benefit (777) (8,929) 4,138 <F3> (5,568)
Minority interests 3,625 - - 3,625
---------------- ------------------ --------------- ----------------
LOSS FROM CONTINUING OPERATIONS $ (19,703) $ (12,989) $ 12,412 $ (20,280)
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</TABLE>
See accompanying notes to unaudited pro forma condensed financial statements.
<PAGE>
<TABLE>
P&L COAL HOLDINGS CORPORATION
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
AS OF SEPTEMBER 30, 2000
(In thousands)
Peabody Resources Pro Forma
Historical Limited<F1> Adjustments Pro Forma
---------------- ------------------ --------------- ----------------
<S> <C> <C> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 55,434 $ (7,158) $ 40,000 <F4>$ 88,276
Accounts receivable, net 151,756 (22,219) - 129,537
Materials and supplies 48,737 (5,398) - 43,339
Coal inventory 174,150 (28,823) - 145,327
Assets from coal and emission
allowance trading activities 131,481 - - 131,481
Deferred income taxes 49,869 - - 49,869
Other current assets 41,101 (22,279) - 18,822
---------------- ------------------ --------------- ----------------
Total current assets 652,528 (85,877) 40,000 606,651
Property, plant, equipment and
mine development, net 4,718,339 (391,682) - 4,326,657
Net assets of discontinued operations 15,510 - - 15,510
Investments and other assets 277,216 (7,326) (11,000)<F5> 258,890
---------------- ------------------ --------------- ----------------
Total assets $ 5,663,593 $ (484,885) $ 29,000 $ 5,207,708
================ ================== =============== ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Short-term borrowings and current maturities
of long-term debt $ 58,637 $ (13,606) $ - $ 45,031
Payable to affiliates - 376 - 376
Income taxes payable 8,837 (8,343) - 494
Liabilities from coal and emission allowance
trading activities 129,059 - - 129,059
Accounts payable and accrued expenses 546,604 (64,301) - 482,303
---------------- ------------------ --------------- ----------------
Total current liabilities 743,137 (85,874) - 657,263
Long-term debt, less current maturities 1,904,360 (99,760) (400,000)<F6> 1,404,600
Deferred income taxes 613,146 (50,273) - 562,873
Accrued reclamation and other
environmental liabilities 477,129 (24,579) - 452,550
Workers' compensation obligations 212,605 - - 212,605
Accrued postretirement benefit costs 979,388 - - 979,388
Obligation to industry fund 64,458 - - 64,458
Other noncurrent liabilities 160,808 (8,087) - 152,721
---------------- ------------------ --------------- ----------------
Total liabilities 5,155,031 (268,573) (400,000) 4,486,458
Minority interests 41,986 - - 41,986
Investment in Peabody Resources Limited - (216,312) 216,312<F7> -
Stockholders' equity 466,576 - 212,688<F8> 679,264
---------------- ------------------ --------------- ----------------
Total liabilities and stockholders' equity $ 5,663,593 $ (484,885) $ 29,000 $ 5,207,708
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</TABLE>
<PAGE>
P&L COAL HOLDINGS CORPORATION
NOTES TO UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENTS
[FN]
<F1> Represents the elimination of the historical accounts of Peabody Resources
Limited for each of the periods presented.
<F2> Represents the elimination of interest expense for the period, assuming
$400 million of the sale proceeds are utilized to repay debt. The interest
expense adjustment was calculated using the average interest rate on the
Senior Credit Facility during the periods presented. The statements of
operations do not include interest earned on the cash proceeds in excess of
debt repayment of $40 million, which would have been approximately $2.1
million for year ended March 31, 2000, and $1.3 million for the six months
ended September 30, 2000.
<F3> Adjusts income tax expense by applying the pro forma tax rate to the pro
forma adjustments.
<F4> Represents the estimated net proceeds from the sale of Peabody Resources
Limited, after the repayment of $400 million of long-term debt and the
payment of $15 million of transaction costs.
<F5> Represents the write-off of a portion of deferred financing costs
associated with the Company's Senior Credit Facility, resulting from the
accelerated debt repayment.
<F6> Represents the repayment of $400 million of the Company's Senior Credit
Facility.
<F7> Reflects the elimination of the investment in Peabody Resources Limited as
of September 30, 2000.
<F8> Reflects the projected net gain associated with the sale transaction.
</FN>
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
P&L COAL HOLDINGS CORPORATION
Date: January 9, 2001 /s/ RICHARD A. NAVARRE
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Richard A. Navarre
Vice President and Chief Financial Officer
(Principal Financial Officer)
<PAGE>
EXHIBIT INDEX
The exhibits below are numbered in accordance with the Exhibit Table of Item 601
of Regulation S-K.
Exhibit
No. Description of Exhibit
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2.1 Share Purchase Agreement dated as of December 26, 2000, between
P&L Coal Holdings Corporation, Gold Fields Mining Corporation and
Coal & Allied Industries Limited
