Amendment to Current Report — Form 8-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 8-K/A Amendment to Current Report HTML 18K
2: EX-23.1 Consent of Espineira, Sheldon Y Asociados 1 6K
3: EX-99.1 Audited Financial Statements 27 106K
4: EX-99.2 Unaudited Balance Sheet 5 23K
5: EX-99.3 Unaudited Proforma Balance Sheet 5 29K
EX-99.3 — Unaudited Proforma Balance Sheet
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Exhibit 99.3
PEABODY ENERGY CORPORATION
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined financial statements give
effect to two acquisitions completed by the Company during 2004. On December 2,
2004, the Company completed the acquisition of a 25.5% interest in Carbones del
Guasare, S.A. (the owner of the Paso Diablo Mine) from RAG Coal International AG
for $32.5 million, including $9.5 million of cash and a $23.0 million assumption
of a short-term payable from affiliates of RAG Coal International AG.
On April 15, 2004, the Company completed the acquisition of all of the
outstanding ordinary shares and redeemable preference shares of RAG Australia
Coal Pty Limited ("RAG Australia") and all of the outstanding shares of capital
stock of Twentymile Coal Company, Colorado Yampa Coal Company, RAG Empire
Corporation and RAG Shoshone Coal Corporation (collectively, "RAG Colorado").
The purchase price of RAG Australia was $256.2 million, and the purchase price
of RAG Colorado was $186.0 million. The Company financed the purchase price of
the RAG Australia and RAG Colorado acquisitions with the issuance, on March 23,
2004, of $250.0 million of 5.875% Senior Notes due 2016 and 8,825,000 shares of
the Company's common stock, priced at $45.00 per share. Proceeds from the debt
and equity offerings in excess of the purchase price for the RAG Australia and
RAG Colorado acquisitions were used for general corporate purposes. The RAG
Australia and RAG Colorado acquisitions are also discussed in Note 4 to the
Company's September 30, 2004 Quarterly Report on Form 10-Q and in a Current
Report on Form 8-K filed on March 10, 2004.
The unaudited pro forma combined statement of operations for the year
ended December 31, 2003 assumes that the acquisitions and related financings
occurred on January 1, 2003 and the unaudited pro forma combined statement of
operations for the nine months ended September 30, 2004 assumes that the
acquisitions and related financings occurred on January 1, 2004. The unaudited
pro forma combined balance sheet as of September 30, 2004 is presented as if the
acquisition of the 25.5% interest in Carbones del Guasare, S.A. had occurred on
that date. The RAG Australia and RAG Colorado acquisitions and related
financings occurred prior to September 30, 2004.
The unaudited pro forma combined financial statements should be read in
conjunction with (i) the historical audited financial statements of the Company
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations" included in its Annual Report on Form 10-K for the year ended
December 31, 2003 and its Quarterly Report on Form 10-Q for the nine months
ended September 30, 2004, (ii) the historical audited financial statements of
Carbones del Guasare, S.A. included in this Form 8-K and (iii) the historical
audited financial statements of RAG Australia and RAG Colorado included in the
Form 8-K filed by the Company on March 10, 2004.
The unaudited pro forma combined financial statements are for
informational purposes only and are not necessarily indicative of the financial
position that would have been obtained or the results of operations that would
have occurred if the acquisitions had been consummated on the dates indicated,
nor are they necessarily indicative of the financial position or results of
operations in the future. The pro forma adjustments, as described in the Notes
to Pro Forma Combined Financial Statements, are based upon available information
and upon assumptions that the Company's management believes are reasonable. The
actual amounts the Company records based on its final assessment of fair values
may differ materially from the information presented in these unaudited pro
forma combined financial statements.
1
Exhibit 99.3
PEABODY ENERGY CORPORATION
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2003
(Dollars in thousands, except per share data)
[Enlarge/Download Table]
Peabody
Energy RAG Colorado RAG Australia Pro Forma Pro Forma
Historical Historical Historical Adjustments as Adjusted
------------ ------------ ------------- ----------- ------------
REVENUES
Sales $ 2,729,323 $ 146,514 $ 241,473 $ -- $ 3,117,310
Other revenues 100,157 441 2,278 8,756 (a) 111,632
------------ ----------- ------------ --------- ------------
Total revenues 2,829,480 146,955 243,751 8,756 3,228,942
COSTS AND EXPENSES
Operating costs and expenses 2,335,800 104,107 165,460 (887)(b) 2,604,480
Depreciation, depletion and amortization 234,336 23,668 26,666 (27,488)(c) 257,182
Asset retirement obligation expense 31,156 495 1,142 1,868 (d) 34,661
Selling and administrative expenses 108,525 1,956 8,438 -- 118,919
Net (gain) loss on property and
equipment disposals (25,123) (140) 90 -- (25,173)
------------ ----------- ------------ --------- -----------
OPERATING PROFIT 144,786 16,869 41,955 35,263 238,873
Interest expense 98,540 2 6,427 (6,429)(e) 113,644
15,104 (f)
Early debt extinguishment costs 53,513 -- -- 53,513
Interest income (4,086) (47) (3,367) 3,414 (e) (4,086)
------------ ----------- ------------ --------- -----------
INCOME (LOSS) BEFORE INCOME TAXES
AND MINORITY INTERESTS (3,181) 16,914 38,895 23,174 75,802
Income tax provision (benefit) (47,708) 6,438 11,546 4,705 (g) (25,019)
Minority interests 3,035 -- -- -- 3,035
------------ ----------- ------------ --------- -----------
INCOME FROM
CONTINUING OPERATIONS $ 41,492 $ 10,476 $ 27,349 $ 18,469 $ 97,786
============ =========== ============ ============= ===========
Basic earnings per share $ 0.78 $ 1.57
Diluted earnings per share 0.76 1.54
Weighted average shares outstanding - basic 53,409,521 8,825,000 62,234,521
Weighted average shares outstanding - diluted 54,835,628 8,825,000 63,660,628
2
PEABODY ENERGY CORPORATION
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 2004
(Dollars in thousands, except per share data)
[Enlarge/Download Table]
RAG Colorado RAG Australia
Historical Historical
Peabody For the Period For the Period
Energy January 1 to January 1 to Pro Forma Pro Forma
Historical April 15, 2004 April 15, 2004 Adjustments as Adjusted
(h) (h) (h) (h)
----------- --------------- -------------- ----------- ------------
REVENUES
Sales $ 2,538,189 $40,881 $ 83,144 $ -- $ 2,662,214
Other revenues 93,584 98 1,239 7,747 (a) 102,668
----------- ------- -------- --------- -----------
Total revenues 2,631,773 40,979 84,383 7,747 2,764,882
COSTS AND EXPENSES
Operating costs and expenses 2,147,956 26,963 84,543 (258)(b) 2,259,204
Depreciation, depletion and amortization 202,992 6,434 8,610 (6,962)(c) 211,074
Asset retirement obligation expense 31,810 144 333 864 (d) 33,151
Selling and administrative expenses 93,559 -- 583 -- 94,142
Net (gain) loss on property and
equipment disposals (4,267) -- -- -- (4,267)
----------- ------- -------- --------- -----------
OPERATING PROFIT 159,723 7,438 (9,686) 14,103 171,578
Interest expense 70,849 1 1,713 (1,714)(e) 74,304
3,455 (f)
Early debt extinguishment gains (556) -- -- -- (556)
Interest income (3,212) -- (672) 672 (e) (3,212)
----------- ------- -------- --------- -----------
INCOME (LOSS) BEFORE INCOME TAXES
AND MINORITY INTERESTS 92,642 7,437 (10,727) 11,690 101,042
Income tax provision (benefit) (15,756) 2,975 (3,217) 1,269 (g) (14,729)
Minority interests 900 -- -- -- 900
----------- ------- -------- --------- -----------
INCOME FROM
CONTINUING OPERATIONS $ 107,498 $ 4,462 $ (7,510) $ 10,421 $ 114,871
=========== ======= ======== ========= ===========
Basic earnings per share $ 1.75 $ 1.80
Diluted earnings per share 1.71 1.76
Weighted average shares outstanding - basic 61,354,266 2,608,850 63,963,116
Weighted average shares outstanding - diluted 62,820,996 2,608,850 65,429,846
3
PEABODY ENERGY CORPORATION
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
AS OF SEPTEMBER 30, 2004
(Dollars in thousands)
[Enlarge/Download Table]
Peabody
Energy Pro Forma
Historical Adjustments (i) Total
---------- --------------- ----------
Assets
Current assets
Cash and cash equivalents $ 401,835 $ (9,529) $ 392,306
Accounts receivable, less allowance 173,006 -- 173,006
Materials and supplies 57,587 -- 57,587
Coal inventory 265,452 -- 265,452
Assets from coal trading activities 131,082 -- 131,082
Deferred income taxes 15,778 -- 15,778
Other current assets 47,455 -- 47,455
---------- -------- ----------
Total current assets 1,092,195 (9,529) 1,082,666
Property, plant, equipment and mine development, net 4,725,843 -- 4,725,843
Investments and other assets 320,893 32,472 353,365
---------- -------- ----------
Total assets $6,138,931 $ 22,943 $6,161,874
========== ======== ==========
Liabilities and Stockholders' Equity
Current liabilities
Current maturities of long-term debt $ 18,918 $ -- $ 18,918
Liabilities from coal trading activities 101,398 -- 101,398
Accounts payable and accrued expenses 665,999 22,943 688,942
---------- -------- ----------
Total current liabilities 786,315 22,943 809,258
Long-term debt, less current maturities 1,398,023 -- 1,398,023
Deferred income taxes 415,567 -- 415,567
Asset retirement obligations 412,056 -- 412,056
Workers' compensation obligations 223,332 -- 223,332
Accrued postretirement benefit costs 944,336 -- 944,336
Obligation to industry fund 41,996 -- 41,996
Other noncurrent liabilities 280,835 -- 280,835
---------- -------- ----------
Total liabilities 4,502,460 22,943 4,525,403
Minority interests 1,991 1,991
Stockholders' equity 1,634,480 -- 1,634,480
---------- -------- ----------
Total liabilities and stockholders' equity $6,138,931 $ 22,943 $6,161,874
========== ======== ==========
4
Exhibit 99.3
PEABODY ENERGY CORPORATION
NOTES TO PRO FORMA COMBINED FINANCIAL STATEMENTS
(UNAUDITED)
(a) To record the Company's pro rata share (25.5%) of earnings related to the
investment in Carbones del Guasare, S.A., including the amortization of the
difference between cost of the investment and the underlying equity in the
net assets of Carbones del Guasare at the date of the investment.
(b) To adjust operating costs and expenses related to postretirement and
pension benefits based on the portion of the acquisition cost allocated to
postretirement benefit and pension obligations.
(c) To adjust depreciation, depletion and amortization based on the portion of
the acquisition cost allocated to long-lived assets and coal supply
agreements.
(d) To adjust asset retirement obligation expense based on the portion of the
acquisition cost allocated to asset retirement obligations.
(e) To reverse historical interest expense incurred by RAG Colorado and RAG
Australia, as well as historical interest income earned by RAG Colorado and
RAG Australia.
(f) To reflect the interest expense on $250 million aggregate principal amount
of new senior notes, including the amortization of $5.3 million of debt
issuance costs.
(g) To record income tax expense (benefit) on the pro forma adjustments to
results of operations using the statutory rates in effect in the United
States and Australia.
(h) The Company's historical results for the nine months ended September 30,
2004 include the results of operations of RAG Colorado and RAG Australia
from April 16, 2004 to September 30, 2004. The historical results of RAG
Colorado and RAG Australia for the period from January 1, 2004 to April 15,
2004 and the pro forma adjustments noted in (b) through (g) above give
effect to these acquisitions as if they occurred on January 1, 2004.
(i) To record the purchase of the 25.5% interest in Carbones del Guasare, S.A.
5
Dates Referenced Herein and Documents Incorporated by Reference
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