XML 101 R18.htm IDEA: XBRL DOCUMENT v3.19.3
Intangible Contract Assets and Liabilities
 9 Months Ended
Sep. 30, 2019
Revenue Recognition [Abstract]  
Intangible Contract Assets and Liabilities Intangible Contract Assets and Liabilities
As described in Note 2. “Emergence from the Chapter 11 Cases and Fresh Start Reporting” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 and Note 3. “Acquisition of Shoal Creek Mine,” the Company has recorded intangible assets and liabilities to reflect the fair value of certain U.S. coal supply agreements as a result of differences between contract terms and estimated market terms for the same coal products, and also recorded intangible liabilities related to unutilized capacity under its port and rail take-or-pay contracts. The balances, net of accumulated amortization, and respective balance sheet classifications at September 30, 2019 and December 31, 2018, are set forth in the following tables:
 
September 30, 2019
 
Assets
 
Liabilities
 
Net Total
 
(Dollars in millions)
Coal supply agreements
$
44.5

 
$
(23.4
)
 
$
21.1

Take-or-pay contracts
—

 
(41.2
)
 
(41.2
)
Total
$
44.5

 
$
(64.6
)
 
$
(20.1
)
 
 
 
 
 
 
Balance sheet classification:
 
 
 
 
 
Investments and other assets
$
44.5

 
$
—

 
$
44.5

Accounts payable and accrued expenses
—

 
(9.5
)
 
(9.5
)
Other noncurrent liabilities
—

 
(55.1
)
 
(55.1
)
Total
$
44.5

 
$
(64.6
)
 
$
(20.1
)
 
 
 
 
 
 
 
December 31, 2018
 
Assets
 
Liabilities
 
Net Total
 
(Dollars in millions)
Coal supply agreements
$
70.9

 
$
(32.9
)
 
$
38.0

Take-or-pay contracts
—

 
(57.1
)
 
(57.1
)
Total
$
70.9

 
$
(90.0
)
 
$
(19.1
)
 
 
 
 
 
 
Balance sheet classification:
 
 
 
 
 
Investments and other assets
$
70.9

 
$
—

 
$
70.9

Accounts payable and accrued expenses
—

 
(20.3
)
 
(20.3
)
Other noncurrent liabilities
—

 
(69.7
)
 
(69.7
)
Total
$
70.9

 
$
(90.0
)
 
$
(19.1
)

Amortization of the intangible assets and liabilities related to coal supply agreements occurs ratably based upon coal volumes shipped per contract and is recorded as a component of “Depreciation, depletion and amortization” in the accompanying unaudited condensed consolidated statements of operations. Such amortization amounted to $5.3 million and $24.0 million during the three months ended September 30, 2019 and 2018, respectively, and $16.9 million and $78.4 million during the nine months ended September 30, 2019 and 2018, respectively. The Company anticipates net amortization of sales contracts, based upon expected shipments, to be an expense of approximately $6 million during the remaining three months of 2019, and for the years 2020 through 2023, expense of approximately $11 million, $2 million, $1 million and $1 million, respectively.
Future unutilized capacity and the amortization periods related to the take-or-pay contract intangible liabilities are based upon estimates of forecasted usage. Such amortization, which is classified as a reduction to “Operating costs and expenses” in the accompanying unaudited condensed consolidated statements of operations, amounted to $2.7 million and $5.4 million during the three months ended September 30, 2019 and 2018, respectively, and $13.9 million and $21.5 million during the nine months ended September 30, 2019 and 2018, respectively. The Company anticipates net amortization of take-or-pay contract intangible liabilities to be approximately $3 million during the remaining three months of 2019, and for the years 2020 through 2023, approximately $8 million, $4 million, $3 million and $2 million, respectively, and $21 million thereafter.