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)
October 19, 1995
ASHLAND COAL, INC.
(Exact name or registrant as specified in its charter)
Delaware 1-9993 61-0880012
(State or other (Commission file number) (I.R.S.Employer
jurisdiction of Identification No.)
incorporation or
organization)
2205 Fifth Street Road, Huntington, West Virginia 25701
(Address of principal executive offices) (Zip Code)
P.O. Box 6300, Huntington, West Virginia 25771
(Mailing Address) (Zip Code)
Registrant's telephone number, including area code: (304) 526-3333<PAGE>
Item 5. Other Events.
On October 19, 1995, Ashland Coal, Inc. (the "Company")
issued a press release announcing its earnings for the quarter
ended September 30, 1995, and discussing the Company's expectations
for earnings in the fourth quarter of 1995, and in 1996 and 1997.
Fourth quarter 1995 earnings are expected to be comparable to the
Company's earnings in the fourth quarter of 1994. Earnings for
1996 are expected to be down significantly from the expected 1995
earnings. Earnings for 1997 are expected to improve significantly
over 1996 levels as a consequence of the full effects of the
Company's cost reduction program and an upswing in average
realization. The foregoing summary of the attached press release
is qualified in its entirety by the complete text of such document,
a copy of which is attached hereto.
Item 7. Financial Statements and Exhibits.
99. Press Release
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
ASHLAND COAL, INC.
(Registrant)
By: /s/ Roy F. Layman
Administrative Vice
President and Secretary
Date: October 19, 1995
Ashland Coal Reports Earnings for Third Quarter
Huntington, WV--Ashland Coal, Inc. (NYSE:ACI) reported today that it
earned $9.2 million, or $.48 a share on a fully diluted basis, for its
third quarter which ended September 30, 1995. For the third quarter of
1994, net income was $10.2 million, or $.53 a share. Revenues for the
third quarter were $158.6 million in 1995 and $157.4 million in 1994.
For the nine months ended September 30, 1995, Ashland Coal earned
$29.8 million, or $1.55 a share. During the comparable period of 1994, the
company earned $18.6 million, or $.97 a share. Revenues for the first nine
months were $466.8 million in 1995 and $449.6 million in 1994.
"For the quarter, our average cost of coal sold decreased
significantly from last year's level, and sales volume increased 7%,"
commented William C. Payne, chairman of the board, president and chief
executive officer. "These improvements overcame a reduction in average
selling price which primarily resulted from the expiration of a sales
contract at the end of 1994 and other contract changes," Payne continued.
Last year's quarter benefited from $3.2 million in non-recurring
operating revenues and a negative income tax expense. The current quarter
benefited from a $2.3 million reduction in employee benefit expenses
arising from a revised actuarial estimate of the cost of postretirement
benefits. The current quarter also benefited from elimination of noncash
selling expenses related to the expired sales contract. Income taxes
increased $1.5 million, exceeding the increase in income before income
taxes.
"We are looking forward to an excellent 1995, capped by a fourth
quarter that we expect to be comparable to 1994's fourth quarter," Payne
stated. "However, in 1996 our earnings will be adversely affected by the
expiration at the end of 1995 of several high priced, high volume sales
contracts with Cincinnati Gas & Electric and by price reopeners under other
contracts," Payne said. "In an effort to control the effects of these
price changes, we have undertaken numerous steps at our mines to increase
profitability. These steps will have a substantial favorable effect on
1996 earnings, and even greater positive effects are expected for 1997 when
the full benefit of these steps is realized," Payne continued. "In
addition, we are evaluating other steps which have significant potential
for earnings improvement. But unfavorable market conditions are hindering
our efforts to replace the lost earnings for 1996. We now believe that
earnings for 1996 will be down significantly from the projected high level
of 1995," Payne noted. "However, based on preliminary plans, we expect
1997 earnings will improve significantly over anticipated 1996 levels as we
experience the full effects of our cost reduction program and our average
realization swings upward again," Payne concluded.
Ashland Coal, Inc. is engaged in the mining, processing and sale of
low-sulfur coal, and markets its coal principally to electric utilities in
the eastern United States and into the export markets.
