Curated News
By: NewsRamp Editorial Staff
October 31, 2025

Alliance Resource Posts Strong Q3 Despite Coal Price Pressures

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Original Source

TLDR

  • Alliance Resource Partners gained competitive advantage through higher coal volumes and reduced costs, boosting net income despite lower pricing in 3Q25.
  • ARLP's 3Q25 performance showed a 6.9% revenue decrease offset by 8.5% production increase and 14.8% sequential EBITDA growth through improved operational execution.
  • ARLP's strengthened financial position and consistent cash distributions support economic stability for investors and communities dependent on the energy sector.
  • ARLP holds 568 Bitcoin valued at $64.8 million while achieving 5.5% coal EBITDA growth despite transitioning longwall operations at Tunnel Ridge.

Impact - Why it Matters

This financial performance matters because Alliance Resource Partners represents a significant player in the energy sector, particularly in coal production and mineral rights. As global energy markets continue to evolve and face volatility, the company's ability to maintain profitability despite pricing pressures demonstrates operational resilience. For investors, ARLP's strong cash flow generation and consistent distributions provide income stability in a sector known for cyclicality. The company's performance also serves as a barometer for the broader coal industry's health, particularly in key regions like the Illinois Basin and Appalachia. Furthermore, ARLP's growing royalty business and Bitcoin holdings show diversification efforts that could provide additional revenue streams amid changing energy landscapes.

Summary

Alliance Resource Partners, L.P. (NASDAQ: ARLP) delivered a solid third quarter performance in 2025, demonstrating resilience despite market headwinds. The partnership reported total revenues of $571.4 million, representing a 6.9% year-over-year decrease, primarily driven by lower coal price realizations and reduced transportation revenues. However, net income showed significant improvement, rising to $95.1 million compared to $86.9 million in the same quarter last year, supported by lower operating costs and higher investment income. Adjusted EBITDA reached $185.8 million, marking a strong 14.8% sequential increase from the previous quarter. The company's coal operations showed particular strength, with coal sales volumes increasing 3.9% year-over-year to 8.70 million tons, though average pricing declined 7.5% to $58.78 per ton.

The partnership's operational performance revealed regional variations, with the Illinois Basin showing robust growth in sales volumes of 10.8% year-over-year to 6.61 million tons, while Appalachia volumes declined 13.3% to 2.09 million tons due to transitional mining activities at Tunnel Ridge. Total Segment Adjusted EBITDA from coal operations reached $157.5 million, up 5.5% year-over-year. The royalty business also contributed significantly, with total royalty revenues of $57.4 million, including oil and gas royalties of $32.1 million and coal royalty tons sold increasing by an impressive 38.1% to 7.06 million tons. Stonegate Capital Partners, the capital markets advisory firm providing this coverage update, highlighted ARLP's strong liquidity position of $541.8 million and free cash flow of $151.4 million for the quarter.

Looking forward, Alliance Resource Partners has tightened its full-year 2025 guidance, projecting fourth quarter results comparable to the third quarter performance. The partnership maintains a quarterly cash distribution of $0.60 per unit and holds a substantial position of 568 Bitcoin valued at $64.8 million at quarter-end. Stonegate Capital Partners' valuation analysis using an EV/EBITDA framework suggests a target range of $30.52 to $33.31, with a midpoint of $31.91, indicating confidence in the partnership's operational execution and improving cost structure. The coverage update from Stonegate Capital Partners emphasizes the company's positioning for continued success through the remainder of the fiscal year.

Source Statement

This curated news summary relied on content disributed by Reportable. Read the original source here, Alliance Resource Posts Strong Q3 Despite Coal Price Pressures

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