Editor's note: The previous version of this story incorrectly stated that Fording expected to sell about 3.3 million tons of coal in its fourth quarter. In fact, Fording expects to sell about 4 million tons of coal in the fourth quarter, representing growth of 5% sequentially. We apologize for and regret the error.

I suppose this is convenient in a way: When last I wrote about Fording Canadian Coal Trust (NYSE:FDG), it was trading at about the mid-$30s (split-adjusted). After Tuesday's reaction to this trust's earnings and outlook, the stock is once again trading there.

Results for the third quarter continue to reflect the stronger market for metallurgical (met) coal, which is used in steelmaking. Revenue nearly doubled as extremely strong sales prices (up 116% in U.S. dollars, 96% in Canadian dollars) augmented 6% production growth. Although production and transportation costs were also higher, Fording nevertheless produced more than five times higher net income (before a tax reversal).

That's all well and good, but what investors really care about is the cash available for distribution, because this number guides the dividends. Here the news looks pretty good, as the amount of cash available was almost five times higher at more than $250 million. For this quarter at least, Fording has actually declared a dividend that is larger than the cash available for distribution -- $1.45 per share versus the $1.39 available. One note of caution, though; I'm translating into U.S. dollars from Canadian dollars, but most U.S. investors will actually see a lower amount because of the particular rules of Canadian tax withholding.

In other good news for the quarter, Elk Valley Coal (the company that Fording owns part of) completed two 10-year agreements with POSCO (NYSE:PKX) and Nippon Steel and signed a letter of intent for an agreement with JFE Steel. While it's not as though there was really any risk of unsold coal just lying around, the deal should nevertheless help smooth out operations.

Not all of the news was good, though, as Fording lowered its sales volume guidance. Based on that guidance, it would seem that the company expects to sell about 4 million tons of coal in the forth quarter, about 5% or more on a sequential basis. The culprit is largely the markets themselves, as customers overordered early in the year because they feared that they might not get enough coal or would sell more steel than they did, or both. Whether or not 2005 marks a peak in pricing, 2006 is still shaping up to be a strong year -- though perhaps not as strong as optimists originally hoped.

While Fording is tied into the second-largest met coal supplier in the world, production is likely to increase as BHPBilliton (NYSE:BHP) and others, including Fording/Elk Valley, try to ramp up capacity. So while I fully expect Fording to continue to produce solid cash flow for shareholders, I would caution new investors not to look at recent dividend payouts as a normal baseline for making investing decisions.

Stoke up with more coal Takes:

POSCO is a Motley Fool Income Investor selection.

The Motley Fool has kicked off its ninth annual Foolanthropy campaign! Nominate your favorite charities on our Foolanthropy discussion board through Nov. 1. For guidelines on what makes a charity Foolish, visit www.foolanthropy.com .

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).