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SEGMENT INFORMATION | 9 Months Ended
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Sep. 30, 2021
SEGMENT INFORMATION |
SEGMENT INFORMATION | 16.SEGMENT INFORMATION ​ We operate in the United States as a diversified natural resource company that generates operating and royalty income from the production and marketing of coal to major domestic and international utilities and industrial users as well as royalty income from oil & gas mineral interests. We aggregate multiple operating segments into four reportable segments, Illinois Basin Coal Operations, Appalachia Coal Operations, Oil & Gas Royalties and Coal Royalties. We also have an "all other" category referred to as Other, Corporate and Elimination. ​ Our two coal operations reportable segments correspond to major coal producing regions in the eastern United States with similar economic characteristics including coal quality, geology, coal marketing opportunities, mining and transportation methods and regulatory issues. The two coal operations reportable segments include seven mining complexes operating in Illinois, Indiana, Kentucky, Maryland, Pennsylvania and West Virginia and a coal loading terminal in Indiana on the Ohio River. Our Oil & Gas Royalties reportable segment includes our oil & gas mineral interests which are located primarily in the Permian (Delaware and Midland), Anadarko (SCOOP/STACK), and Williston (Bakken) basins. The operations within our Oil & Gas Royalties reportable segment primarily include receiving royalties and lease bonuses for our oil & gas mineral interests. Our Coal Royalties reportable segment includes coal reserves controlled by Alliance Resource Properties, which are either (a) leased to certain of our coal mining entities or (b) unleased but near our coal mining operations. ​ Beginning in the first quarter of 2021, we began to strategically view and manage our coal royalty activities separately from our coal mining operations since acquiring and managing a variety of royalty producing assets have similar management attributes. As a result, we restructured our reportable segments to better reflect this strategic view in how we manage our business and allocate resources. Prior periods have been recast to include Alliance Resource Properties within our new Coal Royalties reportable segment with offsetting recast adjustments primarily to our coal operations reportable segments and to a lesser extent, our Other, Corporate and Elimination category. Eliminations reported in Other, Corporate and Elimination were also recast to reflect intercompany royalty revenues and offsetting intercompany royalty expense resulting from our new Coal Royalties reportable segment. ​ The Illinois Basin Coal Operations reportable segment includes currently operating mining complexes (a) the Gibson County Coal, LLC ("Gibson") mining complex, which includes the Gibson South mine, (b) the Warrior Coal, LLC ("Warrior") mining complex, (c) the River View Coal, LLC ("River View") mining complex and (d) the Hamilton mining complex. The Illinois Basin Coal Operations reportable segment also includes our currently operating Mt. Vernon Transfer Terminal, LLC ("Mt. Vernon") coal loading terminal in Indiana on the Ohio River. Our Coal Royalties reportable segment discussed below, controls other coal reserves near our Illinois Basin operations which have not yet been leased to our Illinois Basin mining entities. ​ The Illinois Basin Coal Operations reportable segment also includes Mid-America Carbonates, LLC ("MAC") and other support services as well as non-operating mining complexes including (a) the Gibson North mine, which ceased production in the fourth quarter of 2019, (b) Webster County Coal, LLC's Dotiki mining complex, (c) White County Coal, LLC's Pattiki mining complex, (d) Hopkins County Coal, LLC's mining complex, and (e) Sebree Mining, LLC's mining complex. ​ The Appalachia Coal Operations reportable segment includes currently operating mining complexes (a) the Mettiki mining complex, (b) the Tunnel Ridge, LLC mining complex ("Tunnel Ridge") and (c) the MC Mining, LLC mining complex. The Mettiki mining complex includes Mettiki Coal (WV), LLC's Mountain View mine and Mettiki Coal, LLC's preparation plant. Our Coal Royalties reportable segment discussed below, controls the Penn Ridge coal reserves near our Tunnel Ridge operations which have not yet been leased to Tunnel Ridge. ​ The Oil & Gas Royalties reportable segment includes oil & gas mineral interests held by AR Midland, LP and AllDale I & II and includes Alliance Minerals' equity interests in both AllDale III (Note 9 – Investment) and Cavalier Minerals. ​ The Coal Royalties reportable segment includes coal reserves controlled by Alliance Resource Properties, that are either (a) leased to certain of our mining complexes in both the Illinois Basin Coal Operations and Appalachia Coal Operations reportable segments or (b) near our coal mining operations but not yet leased to our coal mining entities. About two thirds of the coal sold by our Coal Operations' mines is leased from our Coal Royalties entities. ​ Other, Corporate and Elimination includes marketing and administrative activities, Matrix Design Group, LLC and its subsidiaries ("Matrix Design"), Alliance Design Group, LLC ("Alliance Design") (collectively, Matrix Design and Alliance Design referred to as the "Matrix Group"), Pontiki Coal, LLC's workers' compensation and pneumoconiosis liabilities, Wildcat Insurance, LLC ("Wildcat Insurance"), which assists the ARLP Partnership with its insurance requirements, AROP Funding and Alliance Finance (both discussed in Note 7 – Long-Term Debt) and other miscellaneous activities. The eliminations included in Other, Corporate and Elimination primarily represent the intercompany coal royalty transactions described above between our Coal Royalties reportable segment and our coal operations' mines. ​ Reportable segment results are presented below. ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Coal Operations | ​ | Royalties | ​ | Other, | ​ | ​ | ​ |
​ | ​ | Illinois |  | ​ |  | ​ | ​ | ​ | ​ | Corporate and |  | ​ | ​ | ​
​ |  | Basin |  | Appalachia |  | Oil & Gas |  | Coal | ​ | Elimination |  | Consolidated |
​ | ​ | (in thousands) |
Three Months Ended September 30, 2021 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Revenues - Outside | ​ | $ | 231,093 | ​ | $ | 154,944 | ​ | $ | 21,191 | ​ | $ | — | ​ | $ | 8,211 | ​ | $ | 415,439 | ​
Revenues - Intercompany | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 13,456 | ​ | ​ | (13,456) | ​ | ​ | — | ​
Total revenues (1) | ​ | ​ | 231,093 | ​ | ​ | 154,944 | ​ | ​ | 21,191 | ​ | ​ | 13,456 | ​ | ​ | (5,245) | ​ | ​ | 415,439 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Segment Adjusted EBITDA Expense (2) | ​ |  | 149,666 | ​ |  | 92,312 | ​ |  | 2,639 | ​ |  | 4,258 | ​ |  | (9,525) | ​ |  | 239,350 | ​
Segment Adjusted EBITDA (3) | ​ |  | 69,305 | ​ |  | 52,726 | ​ |  | 19,080 | ​ |  | 9,198 | ​ |  | 4,280 | ​ |  | 154,589 | ​
Capital expenditures | ​ |  | 19,081 | ​ |  | 12,531 | ​ |  | — | ​ |  | 30 | ​ |  | 1,393 | ​ |  | 33,035 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Three Months Ended September 30, 2020 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Revenues - Outside | ​ | $ | 210,319 | ​ | $ | 132,310 | ​ | $ | 9,721 | ​ | $ | 42 | ​ | $ | 3,259 | ​ | $ | 355,651 | ​
Revenues - Intercompany | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 11,406 | ​ | ​ | (11,406) | ​ | ​ | — | ​
Total revenues (1) | ​ | ​ | 210,319 | ​ | ​ | 132,310 | ​ | ​ | 9,721 | ​ | ​ | 11,448 | ​ | ​ | (8,147) | ​ | ​ | 355,651 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Segment Adjusted EBITDA Expense (2) | ​ |  | 131,014 | ​ |  | 86,701 | ​ |  | 849 | ​ |  | 5,161 | ​ |  | (6,975) | ​ |  | 216,750 | ​
Segment Adjusted EBITDA (3) | ​ |  | 75,583 | ​ |  | 43,105 | ​ |  | 8,898 | ​ |  | 6,287 | ​ |  | (1,172) | ​ |  | 132,701 | ​
Capital expenditures | ​ |  | 3,815 | ​ |  | 14,541 | ​ |  | — | ​ |  | — | ​ |  | 219 | ​ |  | 18,575 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2021 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Revenues - Outside | ​ | $ | 640,260 | ​ | $ | 384,286 | ​ | $ | 52,798 | ​ | $ | — | ​ | $ | 19,160 | ​ | $ | 1,096,504 | ​
Revenues - Intercompany | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 36,410 | ​ | ​ | (36,410) | ​ | ​ | — | ​
Total revenues (1) | ​ | ​ | 640,260 | ​ | ​ | 384,286 | ​ | ​ | 52,798 | ​ | ​ | 36,410 | ​ | ​ | (17,250) | ​ | ​ | 1,096,504 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Segment Adjusted EBITDA Expense (2) | ​ |  | 415,423 | ​ | ​ | 240,494 | ​ | ​ | 7,116 | ​ | ​ | 13,157 | ​ | ​ | (24,619) | ​ |  | 651,571 | ​
Segment Adjusted EBITDA (3) | ​ |  | 197,601 | ​ | ​ | 125,873 | ​ | ​ | 46,405 | ​ | ​ | 23,253 | ​ | ​ | 7,370 | ​ |  | 400,502 | ​
Total assets | ​ |  | 703,060 | ​ | ​ | 422,504 | ​ | ​ | 601,695 | ​ | ​ | 289,100 | ​ | ​ | 132,616 | ​ |  | 2,148,975 | ​
Capital expenditures | ​ |  | 47,997 | ​ | ​ | 34,579 | ​ | ​ | — | ​ | ​ | 30 | ​ | ​ | 6,055 | ​ |  | 88,661 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Nine Months Ended September 30, 2020 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Revenues - Outside | ​ | $ | 551,978 | ​ | $ | 367,523 | ​ | $ | 31,831 | ​ | $ | 47 | ​ | $ | 10,237 | ​ | $ | 961,616 | ​
Revenues - Intercompany | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 29,555 | ​ | ​ | (29,555) | ​ | ​ | — | ​
Total revenues (1) | ​ | ​ | 551,978 | ​ | ​ | 367,523 | ​ | ​ | 31,831 | ​ | ​ | 29,602 | ​ | ​ | (19,318) | ​ | ​ | 961,616 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Segment Adjusted EBITDA Expense (2) | ​ |  | 399,664 | ​ | ​ | 240,846 | ​ | ​ | 2,851 | ​ | ​ | 12,649 | ​ | ​ | (17,021) | ​ |  | 638,989 | ​
Segment Adjusted EBITDA (3) | ​ |  | 141,583 | ​ | ​ | 120,686 | ​ | ​ | 29,534 | ​ | ​ | 16,953 | ​ | ​ | (2,298) | ​ |  | 306,458 | ​
Total assets | ​ |  | 799,936 | ​ | ​ | 461,751 | ​ | ​ | 616,491 | ​ | ​ | 291,854 | ​ | ​ | 61,308 | ​ |  | 2,231,340 | ​
Capital expenditures | ​ |  | 44,073 | ​ | ​ | 57,798 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 949 | ​ |  | 102,820 | ​
(1) | Revenues included in the Other, Corporate and Elimination column are attributable to intercompany eliminations, which are primarily the coal royalties intercompany eliminations, outside revenues at the Matrix Group and other outside miscellaneous sales and revenue activities.
​
(2) | Segment Adjusted EBITDA Expense includes operating expenses, coal purchases and other income. Transportation expenses are excluded as transportation revenues are recognized in an amount equal to transportation expenses when title passes to the customer.
​ ​ The following is a reconciliation of consolidated Segment Adjusted EBITDA Expense to Operating expenses (excluding depreciation, depletion and amortization): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended | ​ | Nine Months Ended | ​
​ | ​ | September 30, | ​ | September 30, | ​
​ | ​ | 2021 |  | 2020 |  | 2021 |  | 2020 |
​ | ​ | (in thousands) | ​
Segment Adjusted EBITDA Expense | ​ | $ | 239,350 | ​ | $ | 216,750 | ​ | $ | 651,571 | ​ | $ | 638,989 | ​
Outside coal purchases | ​ |  | (6,065) | ​ |  | — | ​ |  | (6,179) | ​ |  | — | ​
Other expense | ​ |  | (84) | ​ |  | (723) | ​ |  | (2,632) | ​ |  | (1,456) | ​
Operating expenses (excluding depreciation, depletion and amortization) | ​ | $ | 233,201 | ​ | $ | 216,027 | ​ | $ | 642,760 | ​ | $ | 637,533 | ​
​
(3) | Segment Adjusted EBITDA is defined as net income (loss) attributable to ARLP before net interest expense, income taxes, depreciation, depletion and amortization, general and administrative expenses and asset and goodwill impairments. Management therefore is able to focus solely on the evaluation of segment operating profitability as it relates to our revenues and operating expenses, which are primarily controlled by our segments. Consolidated Segment Adjusted EBITDA is reconciled to net income as follows:
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended | ​ | Nine Months Ended | ​
​ | ​ | September 30, | ​ | September 30, | ​
​ | ​ | 2021 |  | 2020 |  | 2021 |  | 2020 |
​ | ​ | (in thousands) | ​
Consolidated Segment Adjusted EBITDA | ​ | $ | 154,589 | ​ | $ | 132,701 | ​ | $ | 400,502 | ​ | $ | 306,458 | ​
General and administrative | ​ |  | (18,655) | ​ |  | (13,871) | ​ |  | (51,651) | ​ |  | (41,131) | ​
Depreciation, depletion and amortization | ​ |  | (68,763) | ​ |  | (80,182) | ​ |  | (192,698) | ​ |  | (237,662) | ​
Asset impairments | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | (24,977) | ​
Goodwill impairment | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (132,026) | ​
Interest expense, net | ​ |  | (9,389) | ​ |  | (11,156) | ​ |  | (29,595) | ​ |  | (34,799) | ​
Income tax expense | ​ |  | (234) | ​ |  | (293) | ​ |  | (227) | ​ |  | (111) | ​
Net income (loss) attributable to ARLP | ​ | $ | 57,548 | ​ | $ | 27,199 | ​ | $ | 126,331 | ​ | $ | (164,248) | ​
Noncontrolling interest | ​ | ​ | 176 | ​ | ​ | 36 | ​ | ​ | 384 | ​ | ​ | 97 | ​
Net income (loss) | ​ | $ | 57,724 | ​ | $ | 27,235 | ​ | $ | 126,715 | ​ | $ | (164,151) | ​
​

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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