Coal producer Peabody Energy (NYSE:BTU) reported first-quarter results before the market opened this morning. The company reported revenue of $1.63 billion and adjusted EBITDA of $177 million. However, overall weakness in the coal market resulted in Peabody Energy delivering an adjusted loss of $0.19 per share.
Peabody Energy saw first-quarter revenue slide year-over-year as lower realized prices were only partially offset by a 7% increase in sales volume. The company sold a total of 61.3 million tons of coal in the quarter. Weak coal pricing led to lower pre-tax earnings as the company's loss from continuing operations totaled $44.3 million, which is much higher than last year's first-quarter loss of $10.3 million.
There were some positives in the quarter for Peabody Energy. The company's focus on containing its costs led to a 4% reduction in unit costs in both its U.S. and Australian operations. Further, the company kept its capital spending to the lowest it has been in 10 years. These moves improved the company's liquidity to $2.1 billion, while cash increased to $508 million.
The company also saw coal demand in the U.S. rebound as the industry experienced the largest inventory drawdowns on record. That said, the biggest issue is that supply overhang, especially in the global seaborne market, continues to plague Peabody Energy and the coal industry. However, the company still sees positive long-term trends in urbanization leading to increased coal demand growth in the future. Because of this the company continues to position its operations to take advantage of this demand growth when it materializes.