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Income Taxes | 9 Months Ended
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Sep. 30, 2017
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes For the three and nine months ended September 30, 2017 (Successor), the Company estimated its annual effective tax rate based on projected financial income for the full year at the end of the interim reporting period. The tax effect of unusual or infrequently occurring items, including effects of changes in tax laws or rates and changes in judgment about the realizability of deferred tax assets, are reported in the interim period in which they occur. The Company recognized an income tax benefit of $37.6 million and $2.9 million for the three and nine months ended September 30, 2017 (Successor), respectively. The Company recognized no income tax expense for the three and six months ended September 30, 2016 (Successor) and recognized income tax expense of $18.0 thousand for the three months ended March 31, 2016 (Predecessor). On March 31, 2016, the Company experienced an ownership change for purposes of Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"). As a result of such ownership change, absent an applicable exception to such rules, an annual limitation, under Code Section 382 would apply, for federal and certain state income tax purposes, on the utilization of net operating loss carryforwards ("NOLs"). The Company had requested a private letter ruling ("PLR") from the Internal Revenue Service ("IRS") to clarify certain questions, that if the IRS ruled favorably on, would allow the Company to qualify for an exception to the aforementioned rules limiting its utilization of its NOLs. On September 18, 2017, the IRS issued such favorable PLR and, as such, the Company now believes it qualifies for an exception to such limitation rules. Prior to the issuance of the PLR, the Company operated and prepared its financial statements based on an assumption that the annual limitation on the utilization of the NOLs existed. Based on the receipt of the favorable PLR, the Company now believes that it qualifies for an exception to such NOL limitation rules and as such, no annual Code Section 382 limitation to the utilization of its federal NOLs applies. As a result of qualifying for such exception, the Company's federal and state NOLs were revised downward to approximately $1.8 to $2.0 billion as of September 30, 2017. Under the aforementioned exception to the Code Section 382 limitation, if the Company were to undergo a subsequent ownership change within two years of the Asset Acquisition, prior to April 1, 2018, its NOLs would effectively be reduced to zero. A subsequent ownership change could severely limit or eliminate the Company's ability to utilize its NOLs and other tax attributes. See "Part II, Item 1A. Risk Factors - We may be unable to generate sufficient taxable income from future operations, or other circumstances could arise, which may limit or eliminate our ability to utilize our significant tax NOLs or maintain our deferred tax assets" for additional discussion of this risk. In connection with the PLR, the Company made a year-to-date adjustment of $37.6 million, or $0.71 per share, in the third quarter of 2017 to reflect the change in application of Section 382 in computing income tax expense. The Company also recognized an income tax receivable of approximately $17.0 million, which represents the overpayment of estimated quarterly tax payments as a result of the change in estimated tax expense and refundable alternative minimum tax credits of approximately $9.7 million associated with capital expenditures. The Company records deferred tax assets to the extent these assets will more likely than not be realized. The Company provides a valuation allowance for deferred tax assets when it is more likely than not that some portion or all of its deferred tax assets, will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income. The Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial performance in evaluating the realizability of its deferred tax assets. Many factors are considered which impact the Company's projections of future sustained profitability including risk associated with being a newly formed Company with a limited performance record and operating history on a standalone basis, our ability to successfully implement our business strategies and maximize profitable production and other conditions which are beyond the Company's control, such as the health of the global economy and the global steelmaking industry, the level and volatility of met coal prices and the hazards and operating risks involved with mining. The Company has concluded as of September 30, 2017 (Successor), that the valuation allowance was still needed on its deferred tax assets based on the weight of the factors describe above. If it is later determined that the Company will more likely than not realize all, or a portion, of the deferred tax assets, the Company will adjust the valuation allowance in a future period. If for the remainder of 2017, the Company is able to successfully implement its business strategy, maximize profitable production, continue to have positive operating results and projections for met coal pricing stabilize and remain strong, the Company may release all or a portion of its valuation allowance as early as the end of 2017, which could materially and favorably affect net income and stockholders' equity. Results of operations of the Predecessor have historically been included in the federal and state income tax returns of the Parent. Accordingly, the income tax provision included in the Predecessor financial statements was calculated using a method consistent with a separate return basis, as if the Predecessor had been a separate taxpayer. Similarly, historical tax attributes (net operating losses, alternative minimum tax credits, etc.) have been allocated to the Predecessor’s business utilizing a reasonable method of allocation.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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