CONSOL Energy Inc. Earnings Cheat Sheet: Margin Expands Boosted by Rising Revenue, Net Income Rises

S&P 500 (NYSE:SPY) component CONSOL Energy Inc. (NYSE:CNX) reported higher profit for the second quarter as revenue showed growth. Consol Energy, Inc. is a coal and gas energy producer and energy services provider that mainly serves the electric power generation industry in the United States.

Get more Earnings Cheat Sheets with our in depth coverage of earnings season >>

CONSOL Energy Earnings Cheat Sheet for the Second Quarter

Results: Net income for the industrial metals and minerals company rose to $77.4 million (34 cents per share) vs. $66.7 million (29 cents per share) in the same quarter a year earlier. This marks a rise of 16.1% from the year earlier quarter.

Revenue: Rose 23.2% to $1.59 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: CNX reported adjusted net income of 76 cents per share. By that measure, the company fell in line with the mean estimate of 76 cents per share. It beat the average revenue estimate of $1.41 billion.

Quoting Management: “Our coal and gas operations continued to show improved results in safety, with incidence rates down 25% from the year-earlier quarter,” commented J. Brett Harvey, chairman and chief executive officer. “We exceeded our expectations on coal production and our sales team sold a record 1.5 million tons of Bailey coal into the high-vol coking coal market.” “Strategically,” continued Mr. Harvey, “CONSOL Energy is participating fully in the growth of global coal markets. In 2011, we plan to export 10 million tons, which should generate over $1 billion in revenue. In the second quarter, our Baltimore Terminal loaded a near-record 41 vessels and shipped 3.4 million tons of coal. To accommodate future growth, we are expanding our terminal, we are developing the BMX Mine in the Pittsburgh seam, and we are re-starting our Amonate Mining Complex. All three of these coal projects are driven by increased worldwide coal demand.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 18.2% to $1.47 billion in the first quarter. The figure rose 9.6% in the fourth quarter of the last fiscal year from the year earlier and climbed 23.3% in the third quarter of the last fiscal year from the year-ago quarter.

The company fell in line with estimates last quarter after beating forecasts in the previous quarter with net income of 84 cents versus a mean estimate of net income of 78 cents per share.

The company has now seen net income rise in two straight quarters. In the first quarter, net income rose 91.6% from the year earlier.

Gross margins grew 8.3 percentage points to 41.6%. The growth seemed to be driven by increased revenue, as the figure rose 23.2% from the year earlier quarter while costs rose 7.9%.

Competitors to Watch: Peabody Energy Corporation (NYSE:BTU), Arch Coal, Inc. (NYSE:ACI), Alliance Holdings GP, L.P. (NASDAQ:AHGP), Intl. Coal Group, Inc. (NYSE:ICO), Patriot Coal Corporation (NYSE:PCX), Massey Energy Company (NYSE:MEE), Natural Resource Partners LP (NYSE:NRP), Alpha Natural Resources, Inc. (NYSE:ANR), James River Coal Company (NASDAQ:JRCC), and Oxford Resource Partners, LP (NYSE:OXF).

Get more Earnings Cheat Sheets with our in depth coverage of earnings season >>

(Source: Xignite Financials)