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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1993
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from __________ to ________.
Commission File No. 0-752
WESTMORELAND COAL COMPANY
(Exact name of registrant as specified in its charter)
Delaware 23-1128670
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
700 The Bellevue, 200 S. Broad Street, Philadelphia, Pennsylvania 19102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (215) 545-2500
Securities registered pursuant to Section 12(b) of the Act:
TITLE OF EACH CLASS NAME OF STOCK EXCHANGE
ON WHICH REGISTERED
Common Stock, par value $2.50 per share New York Stock Exchange
Depositary Shares, each representing New York Stock Exchange
a one-quarter share of Series A Convertible
Exchangeable Preferred Stock
Preferred Stock Purchase Rights New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
TITLE OF EACH CLASS NAME OF STOCK EXCHANGE
ON WHICH REGISTERED
Series A Convertible Exchangeable New York Stock Exchange
Preferred Stock, par value $1.00 per share
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months, and (2) has been subject to
such filing requirements for the past 90 days.
Yes x No_______
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.
________
The aggregate market value of voting stock held by non-affiliates as of
February 25, 1994 is estimated to be $72,048,000. Voting stock held by
affiliates is designated as voting stock beneficially held by executive
officers and directors and by holders of more than 10% of the
outstanding voting stock.
There were 6,955,477 shares outstanding of the registrant's Common
Stock, $2.50 Par Value (the registrant's only class of common stock), as
of February 25, 1994.
There were 2,300,000 depositary shares outstanding of the registrant's
Preferred Stock, $0.25 Par Value as of February 25, 1994.
The following document has been incorporated by reference into the Parts
of this Form 10-K (i.e., Part I, Part II, etc.) indicated in
parentheses:
Definitive proxy statement to be filed on or about April 29, 1994.
(Parts III and IV.)
PART I
ITEM 1 - BUSINESS
Coal Marketing
Westmoreland Coal Company's (the "Company") principal business is
the production and marketing of coal on a worldwide basis. More
than half of the coal sold by the Company is processed at and
shipped from its coal properties, and includes both steam coal,
sold primarily to electric utilities, and metallurgical coal, sold
primarily to the steel industry. The remaining coal sold by the
Company is produced by other domestic mining companies,
principally smaller producers seeking to utilize the Company's
expertise in the marketing of coal.
The following table shows, for each of the past five years, the
total tons of coal sold, tons sold from company production and
tons sold that were sourced from unaffiliated producers (tons
ooo's):
Total sales Company production Sales for others
1993 16,687 11,551 5,136
1992 19,380 11,774 7,606
1991 20,627 11,570 9,057
1990 20,279 11,679 8,600
1989 19,613 10,813 8,800
Of the total tons of coal sold for others, approximately 37%, 30%
and 38% was produced by domestic mining companies affiliated with
Adventure Resources, Inc. ("Adventure") in 1993, 1992 and 1991,
respectively. The coal sold by the Company which is produced by
Adventure decreased in 1992 and 1993 due to Adventure's mine
closings caused by higher operating costs and depletion of its
coal reserves. On December 2, 1992 Adventure filed voluntary
petitions for reorganization under Chapter 11 of the Bankruptcy
Code with the United States Bankruptcy Court for the Southern
District of West Virginia. Adventure continues to operate its
remaining mines and the Company is continuing in its role of sales
agent. Acting as sales agent for Adventure, the Company purchases
all of Adventure's clean coal production at the time it is
produced thus carrying all inventory and accounts receivable
related to the sale of Adventure's coal production. The Company's
obligation to buy coal from Adventure expired on March 1, 1994 and
discussions are underway to determine the ongoing relationship
with Adventure. At this time, it is expected that this
relationship will be terminated as of June 30, 1994 due to the
Company's need to conserve its working capital in order to
sufficiently fund its internal coal production activities and its
independent power activities. In January 1993, another West
Virginia coal operation for which the Company acted as sales
agent, stopped producing coal. Approximately 2,178,000 tons were
sold for this producer in 1992. See Management's Discussion and
Analysis of Financial Condition and Results of Operations for
additional discussion.
In the case of coal sold for others, the Company may or may not
take title to the coal, but in substantially all such transactions
the Company assumes the credit risk of the purchaser. In 1993,
the Company had no bad debt experience related to coal sold for
others. In 1992, the Company established reserves for bad debts
related to coal sold for others in the amount of $4,801,000. The
bad debt expense in 1991 relating to coal sold for others was not
material.
The Company is able to offer customers a wide variety of coals,
including both steam coal and metallurgical coal, and a range of
services related to its coal sales, including sourcing, blending,
quality control and transportation. Transportation services
include arrangements with railroads, barge lines and vessel
charterers. The Company's wholly owned subsidiary, Westmoreland
Coal Sales Company, Inc. ("WCSC"), also has its own leased fleet
of railcars to increase the availability of transportation and to
reduce transportation costs.
The Company markets coal worldwide, primarily through WCSC, using
both its own sales force and a network of agents in foreign
countries. WCSC has sales offices in Philadelphia, Pennsylvania
and Charlotte, North Carolina. It also has field offices in
Banner, Kentucky and Beckley, West Virginia. These field offices
serve the function of sourcing coals from mines owned by
unaffiliated producers. This gives WCSC access to coals which
complement the Company's own production. The field offices also
have full service quality control laboratories and sampling
personnel in order to assure that coal being shipped to the
customer meets specifications.
Approximately 77% of the tonnage sold by the Company in 1993 was
sold under contracts calling for deliveries over a period longer
than one year. The table below presents the amount of coal
tonnages sold under long-term contracts for the last five years:
Sales under long- Total sales
term contracts tonnage (000s)
% Tons (000s)
1993 77% 12,774 16,687
1992 72% 13,867 19,380
1991 68% 13,969 20,627
1990 73% 14,761 20,279
1989 71% 13,850 19,613
On December 31, 1993, the Company, together with its subsidiaries
(including 3,450,000 tons for 1994 at Westmoreland Resources, Inc.
("WRI"), its 60% owned subsidiary) had sales contracts requiring
it to deliver in 1994 a minimum of 12,825,000 tons of coal, which
commitments will be met from the production of the Company and
other producers. Of this amount, approximately 554,000 tons are
under contracts expiring in a year or less, and approximately
12,271,000 tons are under contracts for more than a year. The
table below presents total sales tonnage under existing long-term
contracts as they expire over the next five years:
Total sales tonnage
under existing long-
term contracts (000s)
1994 12,271
1995 11,409
1996 9,242
1997 5,340
1998 4,781
Included in the tonnage figures above are certain coal sales
covered by agreements of WRI. Under these agreements, WRI has
exercised its right to receive "take or pay" payments from its
customers if they elect not to purchase the minimum tonnages
specified in the agreements. These payments will produce
approximately the same net margin for WRI as if the coal were
delivered.
Substantially all of the Company's long-term contracts have price
adjustment provisions for changes in specified production costs'
indices which generally reflect changes in wage rates, costs of
supplies, union benefits, general and administrative costs, taxes,
environmental and safety legislation and royalties. Some of the
long-term contracts also provide for periodic price renegotiation
and allow for termination after one year's notice upon failure to
agree on a new price. Virtually all long-term contracts contain
provisions for suspension of deliveries in the event of force
majeure. Before long-term commitments expire, it is the Company's
practice to renegotiate them, when appropriate, and thereby extend
the contract, or to acquire new contracts to replace them.
In 1993, the 10 largest customers of the Company accounted for 62%
of its coal revenues. Its two largest customers, Duke Power
Company and Georgia Power Company, accounted for 22% and 10%,
respectively, of the Company's coal revenues in 1993. No other
customer accounted for as much as 10% of the Company's 1993 coal
revenues. Sales to Georgia Power Company and Duke Power Company
are made pursuant to long-term contracts expiring in April 1995
and July 1996, respectively. Pursuant to a scheduled price
renegotiation under the Duke Power Company contract, on August 20,
1992 the Company agreed to reduce its price under this contract,
effective January 1, 1993, by 10%. This price decrease, net of
contractual price escalations in 1993, resulted in a reduction of
revenues, and therefore profits, by approximately $7,100,000 in
1993 as compared to 1992.
Cleancoal Terminal Company ("Cleancoal"), a wholly owned
subsidiary of the Company, is a rail-to-barge transloading and
storage facility on the Ohio River between Louisville, Kentucky
and Cincinnati, Ohio. The terminal gives the Company increased
access to producers in Kentucky and affords the Company greater
access to midwestern, southern and foreign markets. The terminal
is also able to blend western Powder River Basin coals with
eastern Kentucky coals. Cleancoal has an annual transloading
capacity of 6,000,000 tons. It transloaded 2,511,000 tons in
1993, 2,144,000 tons in 1992.
Westmoreland Terminal Company, a wholly owned subsidiary of the
Company, has a 20% interest in Dominion Terminal Associates
("DTA"), a consortium formed for the construction and operation of
a coal storage and vessel-loading facility in Newport News,
Virginia. DTA's annual throughput capacity is 20,000,000 tons,
and its ground storage capacity is 1,700,000 tons. In 1993, DTA
loaded 12,285,000 tons, including 2,428,000 tons for the Company.
Coal Production
The Company produces coal at properties in Virginia, West
Virginia, Kentucky and Montana. Mining activities in the Eastern
United States are conducted by the Company's Virginia Division,
which mines reserves located in Virginia and eastern Kentucky, its
Hampton Division, which mines reserves in West Virginia, Criterion
Coal Company ("Criterion"), a wholly owned subsidiary of the
Company, which mines reserves located in Kentucky and Pine Branch
Mining Incorporated ("Pine Branch"), a wholly owned subsidiary of
the Company, which mines reserves located in Virginia and eastern
Kentucky. The Company's mining operations in Montana are
conducted through WRI which is 60% owned by the Company.
Virginia Division. The Company's Virginia Division consists of
nine mines located in Virginia and eastern Kentucky, including
five underground mines operated by the Company and four mines
operated by contractors, three of which are underground mines and
one of which is a surface mine. In 1993, 1992 and 1991, the
Virginia Division shipped 4,878,000 tons, 4,708,000 tons, and
4,325,000 tons of coal, respectively, including coal produced by
independent contractors on Virginia Division properties and coal
purchased from off-property locations including Pine Branch
Mining. The Virginia Division properties total approximately
60,000 acres and employs approximately 770 people. The Virginia
Division is currently operating two preparation plants for
processing and loading coal. In late 1994 one of these two plants
and one mine will cease operations for economic reasons. See
Management's Discussion and Analysis of Financial Condition and
Results of Operations for additional discussion.
Hampton Division. The Company's Hampton Division is situated in
West Virginia. Its operations currently consist of two
underground mines, a large surface mine and shop and preparation
plant facilities. In 1993, 1992 and 1991, the Hampton Division
shipped 1,561,000 tons, 1,745,000 tons and 1,543,000 tons of coal,
respectively, including coal produced by an independent contractor
on Hampton Division properties and coal purchased from off-
property locations. The Hampton Division has one preparation
plant for processing and loading coal. The Hampton Division's
properties total approximately 14,000 acres and it employs
approximately 130 people. During the first half of 1994 the
Hampton Division will be closed down with the exception of the
surface mine which is operated by a contractor with capacity to
produce approximately 840,000 tons on an annual basis. All other
mines together with the preparation plant and shop facilities will
be closed down and the employees will be terminated. This
closedown has been necessitated by market conditions, including
the termination of an above-market coal sales contract. See
Management's Discussion and Analysis of Financial Condition and
Results of Operations for additional discussion.
Criterion Coal Company. Criterion is a wholly owned subsidiary
of the Company with mining operations in Kentucky. Criterion,
through its wholly owned subsidiary, Kentucky Criterion Coal
Company, consists of five mines, including two surface mines and
three underground mines. All of these mining operations are
conducted by independent contractors on Criterion's properties.
Criterion's total shipments in 1993, 1992 and 1991 were 1,853,000
tons, 1,786,000 tons and 1,600,000 tons of coal, respectively. In
1993, Criterion began operating a new coal preparation plant,
which increased the capacity of the property to 3,000,000 tons per
year. Criterion expects to open a new underground mine in 1994.
Westmoreland Resources, Inc. WRI is 60% owned by the Company,
24% owned by Morrison-Knudsen Corporation and 16% owned by Penn
Virginia Corporation. WRI operates one large surface mine in
Montana on approximately 15,000 acres of subbituminous coal lands.
In 1993, WRI mined and shipped approximately 3,224,000 tons of
coal. Morrison-Knudsen Corporation mines this coal under a
contract with WRI. The majority of the coal sold by WRI is sold
under long-term contracts. One of these long-term contracts,
which expires in 2005, accounted for 62% of the coal sold by WRI
in 1993.
Pine Branch Mining Incorporated. Pine Branch is a wholly
owned subsidiary of the Company with mining operations in Virginia
and eastern Kentucky. Pine Branch began operations in 1992 and it
consists of one surface mine. Pine Branch produced 210,000 tons
in 1993 and 117,000 tons in 1992, the majority of which was sold
to the Virginia Division where it was processed and loaded into
railcars for shipment to customers.
Cogeneration
Westmoreland Energy, Inc.("WEI") a wholly owned subsidiary of the
Company, has been offered for sale by the Company and is therefore
being accounted for as a discontinued operation. (See Note 6 to
the Consolidated Financial Statements.) WEI is engaged in the
business of developing and owning interests in cogeneration and
other non-regulated independent power plants throughout the United
States. Cogeneration is a power production technology that
provides for the sequential generation of two or more useful forms
of energy (e.g., electricity and steam) from a single primary fuel
source (e.g., coal). The key elements of a cogeneration project
are contracts for sales of electricity and steam, contracts for
fuel supply, a suitable site, required permits and project
financing. The economic benefit of cogeneration technology can be
substantial because a significant portion of the energy which is
wasted in the application of conventional technology is used by
cogeneration technology to produce steam or hot water for
industrial processes or the generation of additional electricity.
Electricity is sold to utilities and end-users of electrical
power, including large industrial facilities. Thermal energy from
the cogeneration plant is sold to commercial enterprises and other
institutions. Large industrial users of thermal energy include
plants in the chemical processing, petroleum refining, food
processing, pharmaceutical and pulp and paper industries.
A significant market has been rapidly developing in the United
States for power generated by cogeneration and other independent
power plants. This development was fostered by the energy crises
of the 1970s, which led to the enactment of legislation that
encouraged companies to enter the cogeneration and independent
power generation industry by reducing regulatory requirements and
facilitating the sale of electricity by such companies to
utilities. Cogeneration and other independent power producers are
also an attractive, economical source of energy for large
industrial users which require dedicated energy sources for major
facilities.
WEI, through various subsidiaries, currently has an interest in
the eight cogeneration projects described in the table filed as an
exhibit to this report.
Employees and Labor Relations
The Company, including subsidiaries, employed 1,090 people on
December 31, 1993 compared with 1,195 on December 31, 1992. On
July 1, 1993, the Company, through its membership in the
Independent Bituminous Coal Bargaining Alliance, ("IBCBA") entered
into an interim agreement with the United Mine Workers of America
("UMWA"). This agreement provides for the Company and the UMWA at
the local level to work together to reduce health care costs,
maximize the utilization of the Company's investments, recognize
special local operating and competitive conditions, provide
flexibility in work and scheduling, create incentive programs,
recognize employees' skills and performance, involve and integrate
employees and the UMWA in the success of their mines and the
Company, and improve overall labor management relations. These
features were incorporated into a five-year agreement that
succeeded the interim agreement, and became effective as of
December 1993 ("1994 Agreement").
The Company and the UMWA are in the process of implementing the
1994 Agreement, including its health care cost reduction
provisions, which should make those operations more competitive.
The 1994 Agreement provides for a wage increase of $.50 per hour,
retroactive to February 1, 1993, the date on which the prior five-
year agreement expired. Employees will receive the retroactive
portion of this wage increase in the form of an additional $.50
per hour until the retroactive portion is paid. The 1994
Agreement provides for additional wage increases of $.40 per hour
on December 16, 1994 and December 16, 1995, and for additional
reopeners in 1996 and 1997.
Competition
The coal industry is highly competitive, and the Company competes
(principally in price and quality of coal) in both the steam coal
and metallurgical coal markets with many other coal producers of
all sizes. The Company, including the 1993 production of WRI,
accounted for an estimated 1% of the nation's 1993 coal
production, compared to the nation's largest coal producer which
accounted for an estimated 9%. The Company's steam coal also
competes with other energy sources in the production of
electricity.
WEI is subject to increasing competition with respect to the
development of new cogeneration projects from unregulated
affiliates of utility companies, affiliates of fuel and equipment
suppliers and independent developers.
Mining Safety and Health Legislation
The Company is subject to state and federal legislation
prescribing mining health and safety standards, including the
Federal Coal Mine Safety and Health Act of 1969 and the 1977
Amendments thereto. In addition to authorizing fines and other
penalties for violations, the Act empowers the Mine Safety and
Health Administration to suspend or halt offending operations.
Energy Regulation
WEI's cogeneration operations are subject to the provisions of
various laws and regulations, including the federal Public
Utilities Regulatory Policies Act of 1978 ("PURPA"). PURPA
provides qualifying cogeneration facility status ("QF") to
operations such as WEI's which allows them certain exemptions from
substantial federal and state legislation and regulation,
including regulation of rates at which electricity can be sold.
The most significant recent change in energy regulation was the
passage of the National Energy Policy Act of 1992 ("EP Act"). The
EP Act reformed the Public Utility Holding Company Act of 1935.
Companies can apply for Exempt Wholesale Generator ("EWG") status
with the Federal Energy Regulatory Commission. An EWG can
exclusively provide electric energy at wholesale prices without the
requirement to sell thermal energy to a steam user. WEI applied
for and received EWG status for its Roanoke Valley I ("RV I")
project in December 1993. WEI intends to maintain the QF status
for all projects except RV I. In the future, a case-by-case
determination of QF or EWG status will be completed to optimize
project returns.
Protection of the Environment
Mining Operations. The Company believes its mining operations
are substantially in compliance with applicable federal, state and
local environmental laws and regulations, including those relating
to surface mining and reclamation, and it is the policy of the
Company to operate in compliance with such standards. The Company
believes that this policy will not substantially affect its
ability to compete with similarly situated companies in the
marketplace. Present compliance is largely a result of capital
expenditures made in prior years and of current capital
investments, maintenance and monitoring activities. The Company
invested approximately $413,000 for capital additions and charged
approximately $7,247,000 to earnings and $2,306,000 to reserves in
1993 in order to comply with environmental regulations applicable
to its mining operations. Of the $7,247,000 charged to earnings,
$4,235,000 was accrued as part of the Company's mine closure
costs, discussed in Management's Discussion and Analysis of
Financial Condition and Results of Operations. In addition,
reclamation fees imposed by the Federal Surface Mining Control and
Reclamation Act of 1977 (the "Surface Mining Act") amounted to
approximately $2,148,000 in 1993.
Based on its present interpretation of existing applicable
environmental requirements, the Company has projected that it will
expense approximately $2,400,000 and will spend approximately
$625,000 for capital expenditures related to its mining operations
to meet such requirements in 1994. Estimates of capital
expenditures will be adjusted as necessary, either to reflect the
impact of new regulations or because presently unforeseeable
conditions may be imposed on future mining permits.
The Surface Mining Act regulations set forth standards,
limitations and requirements for surface mining operations and for
the surface effects of deep mining operations. Under the
regulatory scheme contemplated by the Surface Mining Act, the
Federal Office of Surface Mining ("OSM") issued regulations which
set the minimum standards to which state agencies concerned with
the regulation of coal mining must adhere. States that wish to
regulate such coal mining must present their regulatory plans to
OSM for approval. Once a state plan receives final approval, the
state agency has primary regulatory authority over mining within
the state, and OSM acts principally in a supervisory role. State
agencies may impose standards more stringent than those required
by OSM, and in some states this has been or is expected to be
done. The four states in which the Company mines coal, Virginia,
West Virginia, Kentucky and Montana, have all submitted regulatory
plans to OSM, and these plans have received final approval. There
is potential risk to the Company in the event it, or any of its
independent contractors, fails to satisfy the obligations created
by the Surface Mining Act. The Company's surface-mined Eastern
coal production is mined to a large extent by independent
contractors which, pursuant to their agreements with the Company,
are primarily responsible for compliance with environmental laws.
In the event, however, that any of its independent contractors
fail to satisfy their obligations under the Surface Mining Act,
the Company, depending upon the circumstances, might have, and has
had, to carry out such obligations in order to avoid having its
existing permits revoked or applications for new permits or permit
modifications blocked. Compliance with the Surface Mining Act
regulations has been costly for the Company and the coal mining
industry in general.
In 1990 certain amendments were enacted to the Clean Air Act
("1990 Amendments"). As the first major revisions to the Clean
Air Act since 1977, the 1990 Amendments vastly expand the scope of
federal regulations and enforcement in several significant
respects. In particular, the 1990 Amendments require that the
United States Environmental Protection Agency (the "EPA") issue
new regulations related to ozone non-attainment, air toxics and
acid rain. Phase I of the acid rain provisions require, among
other things, that electrical utilities reduce their sulfur
dioxide emissions by 1995. Phase II requires an additional
reduction in emissions by the year 2000.
The acid rain provisions of the 1990 Amendments may have a
positive impact on the Company, in large part because a
substantial amount of the Company's coal reserves are relatively
low in sulfur content, i.e., less than 1 percent. This
legislation allows utilities the freedom to choose the manner in
which they will effect compliance with the required emission
standards, increasing, in the opinion of the Company's management,
the demand for low sulfur coal. The Company currently anticipates
little or no impact on the coal industry from the ozone non-
attainment provision of the 1990 Amendments, and is currently
studying the potential impact of the air toxics provision, which
management believes at this point will have a minimal effect on
the coal industry.
A significant, but indirect, cause of lower coal demand in the
electric utility sector has been low gas prices. The perception
that gas prices will remain low throughout the 1990's has allowed
utilities to plan to meet electricity growth with a combination of
demand-side management and small gas-fired capacity additions.
This strategy may displace potential new coal-fired capacity
through the 1990's. The Company's marketing response has been to
concentrate on maintaining, and attempting to increase, its market
share with existing customers and grow on the basis of utilities
switching from high sulfur to low sulfur coal rather than on the
basis of future coal-fired power plant additions.
Cogeneration. The environmental laws and regulations applicable
to the projects in which WEI participates primarily involve the
discharge of emissions into the water and air, but can also
include wetlands preservation and noise regulation. These laws
and regulations in many cases require a lengthy and complex
process of obtaining licenses, permits and approvals from federal,
state and local agencies. Meeting the requirements of each
jurisdiction with authority over a project can delay or sometimes
prevent the completion of a proposed project, as well as require
extensive modifications to existing projects. The limited
partnerships formed to carry out these projects have the primary
responsibility for obtaining the required permits and complying
with the relevant environmental laws.
The Clean Air Act and the 1990 Amendments contain provisions that
regulate the amount of sulfur dioxide and nitrogen oxides that may
be emitted by a project. These emissions may be a cause of acid
rain. Most of the projects in which WEI has investments are
fueled by low sulfur coal and are not expected to be significantly
affected by the acid rain provisions of the 1990 Amendments.
Segment Information
For financial information about Westmoreland's industry segments
and export sales for the years 1993, 1992 and 1991 refer to Note
12 to the Consolidated Financial Statements, appearing on pages
97-101 inclusive.
For a discussion of certain factors affecting the business of
Westmoreland in 1993, 1992 and 1991 refer to the section entitled
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," appearing on pages 38-53 inclusive, and
Notes 1, 6 and 7 to the Consolidated Financial Statements,
appearing on pages 66-67, 76-83 inclusive.
ITEM 2 - PROPERTIES
The Company owns or leases coal properties located in Virginia,
West Virginia, Kentucky and Montana. The Company's estimated
demonstrated reserves (excluding reserves deemed by the Company to
be uneconomic to mine) in owned or leased property on December 31,
1993 in the three eastern states were 142,791,000 tons and in
Montana were 672,378,000 tons. In the three eastern states the
Company also owns or leases 347,093,000 tons currently classified
by the Company as Unassigned Uneconomic. Unassigned Uneconomic
tonnages require significant capital expenditures and construction
of new mine openings and are legally recoverable with current
technology, but are not in the Company's mining plans today,
because they cannot be mined profitably based on current projected
economic conditions. With the exception of the coal reserves in
Kentucky, which reserves are owned in fee simple, nearly all of
the Company's eastern reserves are leased from others including
343,242,000 tons under lease from Penn Virginia Resources
Corporation, a wholly owned subsidiary of Penn Virginia
Corporation (together "Penn Virginia") which controlled an 18.96%
voting interest in the Company at December 31, 1993 and December
31, 1992. All leases with Penn Virginia run to exhaustion of the
coal reserves. Properties located in Montana are leased by WRI
from the Crow Tribe of Indians and run to exhaustion. The balance
of the Company's leases are for varying terms, including to
exhaustion. Refer to Note 5 to the Consolidated Financial
Statements, on pages 74-75 inclusive.
The table below shows the Company's estimated demonstrated coal
reserve base and production in 1993. The term "demonstrated coal
reserve base" is as defined in the "Coal Resource Classification
System of the U.S. Geological Survey" (Circular 891). This
represents the sum of the measured and indicated reserve bases and
includes assigned and unassigned economic reserves.
Summary of Demonstrated Coal Reserve Base and
Production Tons
as of December 31, 1993
(in thousands)
Total Demonstrated
1993
Unassigned Coal Reserve
Production Sulfur (1) Assigned (2)
Economic(3) Base .
Eastern Operations
Virginia
Steam 3,704 .96/1.38 30,111
5,741 35,852
Metallurgical 456 .60 602
1,924 2,526
West Virginia
Steam 1,324 .77/.85 9,197
0 9,197
Metallurgical 0 .98 0
0 0
Kentucky
Steam 1,755 .74/.95/1.35 23,582
71,634 95,216
Subtotal-Steam 6,783 62,890
77,375 140,265
Subtotal-Met 456 602
1,924 2,526
Subtotal Eastern
Operations 7,239 63,492
79,299 142,791
Western Operations
Montana
Steam 3,224 .62 672,378
0 672,378
Total All Operations 10,463 735,870
79,299 815,169
(1) Percent Sulfur applies to the 1993 production tonnages.
(2) Assigned tonnages are legally recoverable through existing
facilities based on current
mining plans with current technology and the Company's
infrastructure.
(3) Unassigned Economic tonnages require significant capital
expenditures and construction of
new mine openings before mining could begin and are legally and
economically recoverable
with current technology and the Company's infrastructure.
Estimates of reserves in the eastern states are based mainly upon
yearly evaluations made by the Company's professional engineers
and geologists. The Company periodically modifies estimates of
reserves under lease which may increase or decrease previously
reported amounts. The reserve evaluations are based on new
information developed by bore-hole drilling, examination of
outcrops, acquisitions, dispositions, production, changes in
mining methods, abandonments and other information.
Coal reserves in Montana represent recoverable tonnage held under the
terms of the principal Crow Tribe lease, as amended in 1982, as well
as other minor leases, and were estimated at 799,803,000 tons as of
January 1, 1980, based principally upon a report by independent
consulting geologists, prepared in February 1980. The reserve
estimate has been adjusted for subsequent production, changes in
mining practices and coal recovery experience.
In addition to the coal reserves mentioned above, the Company owns
a number of coal preparation and loading facilities in Virginia,
West Virginia and Kentucky. WRI owns and operates a dragline and
coal crushing and loading facilities at its mine in Montana.
ITEM 3 - LEGAL PROCEEDINGS
No material proceedings.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS
This item is inapplicable.
Executive Officers of the Registrant
Below is a table showing the executive officers of the Company,
their ages as of March 1, 1994, positions held and year of election
to their present offices. No family relationships exist among
them. All of the officers are elected annually by the Board of
Directors and serve at the pleasure of the Board of Directors.
Name Age Position(s) Held Since
Christopher K. Seglem 47 President and 1992
Chief Executive Officer (1) 1993
R. Page Henley, Jr. 58 Senior Vice President-Government
Affairs (2) 1992
Theodore E. Worcester 53 Senior Vice President and 1992
General Counsel (3) 1990
Ronald W. Stucki 49 Senior Vice President-
Operations (4) 1992
Francis J. Boyle 48 Senior Vice President, Chief
Financial Officer and Treasurer (5) 1993
Joseph W. Lee 50 President
Westmoreland Coal Sales
Company (6) 1991
Charles J. Brown, III 46 President
Westmoreland Energy, Inc. (7) 1987
Ronald R. Rominiecki 40 Controller (8) 1988
____________________________
(1) Effective January 1988, Mr. Seglem was elected to the
positions of Vice President, General Counsel, and Secretary
for the Company. In November 1988 he was elected a Senior
Vice President of the Company. In May 1990, he relinquished
the position of Secretary. In December 1990, he was elected
an Executive Vice President of the Company, at which time he
relinquished the position of General Counsel. In June 1992,
he was elected President and Chief Operating Officer, and in
December 1992 he was elected a Director of the Company. In
June 1993, he was elected Chief Executive Officer of the
Company, at which time he relinquished the position of Chief
Operating Officer. He is a member of the bar of
Pennsylvania.
(2) Mr. Henley was elected Vice President-Development and
Government Affairs in May 1988, which position he held until
he was elected Senior Vice President-Development and
Government Affairs in May 1990. In June 1992, he was elected
Senior Vice President-Government Affairs. In 1993, Mr.
Henley was also elected Vice President, General Counsel and
Secretary of the Company's WEI subsidiary, and undertook
additional duties, including project development.
Subsequently, on March 29, 1994, he was elected Senior Vice
President-Development of the Company.
(3) Mr. Worcester was a member of the law firm of Sherman &
Howard, with its principal office in Denver, Colorado, from
1972, and a partner in the firm from 1978 until December
1990, at which time he was elected Vice President & General
Counsel of the Company. In June 1992, he was elected Senior
Vice President while retaining his position of General
Counsel of the Company. He is a member of the bar of
Colorado.
(4) Mr. Stucki was General Manager and Vice President of Colorado
Westmoreland Inc. (a former wholly owned subsidiary of the
Company) until the operation was sold to Cyprus Coal Company
(Cyprus) in November 1988, where he continued and became Vice
President of Colorado and Wyoming operations. He left Cyprus
to rejoin the Company as Senior Vice President-Operations in
July 1992.
(5) Mr. Boyle was Chief Financial Officer and Senior Vice
President of El Paso Natural Gas Company from 1985 through
1992. He was elected Senior Vice President, Chief Financial
Officer and Treasurer of the Company, effective August 9,
1993.
(6) Mr. Lee was elected Vice President-Purchasing and Northern
Sales of Westmoreland Coal Sales Company in 1988, which
position he held until he was elected Senior Vice President
of Westmoreland Coal Sales Company on July 1, 1991. Mr. Lee
was elected President of Westmoreland Coal Sales Company on
August 1, 1991.
(7) Mr. Brown terminated employment with the Company effective
April 8, 1994.
(8) Mr. Rominiecki terminated employment with the Company
effective March 31, 1994.
PART II
ITEM 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
Reference is hereby made to the section entitled "Market
Information on Capital Stock" appearing on pages 109-110.
ITEM 6 - SELECTED FINANCIAL DATA
Reference is hereby made to the section entitled "Five-Year Review"
appearing on pages 54-55 inclusive.
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Reference is hereby made to the section entitled "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" appearing on pages 38-53 inclusive.
ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Reference is hereby made to pages 56-61 inclusive.
Reference is also made to the financial statement schedules
included on pages 33-36 inclusive.
ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
This item is inapplicable.
PART III
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE
REGISTRANT
ITEM 11 - EXECUTIVE COMPENSATION
ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
For Items 10-13, inclusive, except for information concerning
executive officers of Westmoreland included as an unnumbered item
in Part I above, reference is hereby made to Westmoreland's
definitive proxy statement dated April 29, 1994, to be filed in
accordance with Regulation 14A pursuant to Section 14(a) of the
Securities Exchange Act of 1934, which is incorporated herein by
reference thereto.
PART IV
ITEM 14- EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
AND REPORTS ON FORM 8-K
a) 1. The financial statements filed herewith are listed
in the Index to Financial Statements on page 37
2. The financial statement schedules filed herewith are
listed in the Index to Financial Statements on page
32. The financial statement schedules are on pages
33-36.
3. The following exhibits are filed herewith as
required by Item 601 of Regulation S-K:
(3) (a) Articles of incorporation, as amended to
date.
(b) Bylaws, as amended on December 4, 1990, were
filed as Exhibit 3(b) to Westmoreland's
Annual Report on Form 10-K for 1990 (SEC
File No. 0-752), which Exhibit 3(b) is
incorporated herein by reference thereto.
(4) Instruments defining the rights of security
holders
(a) A Loan Agreement dated August 10, 1977
between Westmoreland and six insurance
companies was filed as Exhibit 2(b) to
Westmoreland's Annual Report on Form 10-K
for 1977 (SEC File #0-752). That Loan
Agreement is incorporated herein by
reference thereto.
(b) A Revolving Credit Loan Agreement dated
September 25, 1990 between Westmoreland and
four banks - Reference is hereby made to
Exhibit 4(b) to Westmoreland's Annual
Report on Form 10-K for 1990 (SEC File #0-
752), which Exhibit 4(b) is incorporated
herein by reference thereto.
(c) Certificate of Designation of Series A
Convertible Exchangeable Preferred Stock of
the Company defining the rights of holders
of such stock, filed July 8, 1992 as an
amendment to the Company's Certificate of
Incorporation, and filed as Exhibit 3(a) to
Westmoreland's Form 10-K for 1992.
(d) Form of Indenture between Westmoreland and
Fidelity Bank, National Association, as
Trustee relating to the Exchange
Debentures. Reference is hereby made to
Exhibit 4.1 to Form S-2 Registration 33-
47872 filed May 13, 1992, and Amendments 1
through 4 thereto, which Exhibit is
incorporated herein by reference.
(e) Form of Exchange Debenture Reference is
hereby made to Exhibit 4.2 to Form S-2
Registration 33-47872 filed May 13, 1992,
and Amendments 1 through 4 thereto, which
Exhibit is incorporated herein by
reference.
(f) Form of Deposit Agreement among
Westmoreland, First Chicago Trust Company
of New York, as Depositary and the holders
from time to time of the Depositary
Receipts. Reference is hereby made to
Exhibit 4.3 to Form S-2 Registration 33-
47872 filed May 13, 1992, and Amendments 1
through 4 thereto, which Exhibit is
incorporated herein by reference.
(g) Form of Certificate of Designation for the
Series A Convertible Exchangeable Preferred
Stock. Reference is hereby made to Exhibit
4.4 to Form S-2 Registration 33-47872 filed
May 13, 1992, and Amendments 1 through 4
thereto, which Exhibit is incorporated
herein by reference.
(h) Specimen certificate representing the
common stock of Westmoreland, filed as
Exhibit 4(c) to Westmoreland's Registration
Statement on Form S-2, Registration No. 33-
1950, filed December 4, 1985, is hereby
incorporated by reference.
(i) Specimen certificate representing the
Preferred Stock. Reference is hereby made
to Exhibit 4.6 to Form S-2 Registration 33-
47872 filed May 13, 1992, and Amendments 1
through 4 thereto, which Exhibit is
incorporated herein by reference.
(j) Form of Depositary Receipt. Reference is
hereby made to Exhibit 4.7 to Form S-2
Registration 33-47872 filed May 13, 1992,
and Amendments 1 through 4 thereto, which
Exhibit is incorporated herein by
reference.
(k) In accordance with paragraph (b)(4)(iii) of
Item 601 of Regulation S-K, Westmoreland
hereby agrees to furnish to the Commission,
upon request, copies of all other long-term
debt instruments.
(10) Material Contracts
(a) On January 5, 1982, the Board of Directors
of Westmoreland adopted a Management by
Objectives Plan (MBO Plan) for senior
management. A description of this MBO Plan
is set forth on page 9 of Westmoreland's
definitive proxy statement dated March 31,
1982, which description is incorporated
herein by reference thereto.
(b) Westmoreland Coal Company 1982 Incentive
Stock Option and Stock Appreciation Rights
Plan--Reference is hereby made to Exhibit
10(b) to Westmoreland's Annual Report on
Form 10-K for 1981 (SEC File #0-752), which
Exhibit 10(b) is incorporated herein by
reference thereto.
(c) Westmoreland Coal Company 1985 Incentive
Stock Option and Stock Appreciation Rights
Plan--Reference is hereby made to Exhibits
10(d) to Westmoreland's Annual Report on
Form 10-K for 1984 (SEC File #0-752), which
Exhibit 10(d) is incorporated herein by
reference thereto.
(d) Agreement dated July 1, 1984 between
Georgia Power Company and Westmoreland.
Reference is hereby made to pages 33 - 79,
inclusive, of Westmoreland's Annual Report
on Form 10-K for 1985 (SEC File #0-752),
which pages 33 - 79, inclusive, is
incorporated herein by reference thereto.
(e) Letter agreement dated June 11, 1987
relating to the coal supply agreement
between Georgia Power Company and
Westmoreland Coal Company. See (10)(d)
above.
(f) Agreement dated January 1, 1986 between
Mill-Power Supply Company, agent for Duke
Power Company, and Westmoreland Coal Sales
Company, agent for Westmoreland, which is
incorporated herein by reference thereto.
Reference is hereby made to pages 80 - 103,
inclusive, of Westmoreland's Annual Report
on Form 10-K for 1985 (SEC File #0-752),
which pages are incorporated herein by
reference thereto.
(g) In 1990, the Board of Directors established
an Executive Severance Policy for certain
executive officers, which provides a
severance award in the event of termination
of employment. Reference is hereby made to
Exhibit 10(h) to Westmoreland's Annual
Report on Form 10-K for 1990 (SEC File #0-
752), which Exhibit 10(h) is incorporated
herein by reference thereto.
(h) Westmoreland Coal Company 1991 Non-
Qualified Stock Option Plan for Non-
Employee Directors - Reference is hereby
made to Exhibit 10(i) to Westmoreland's
Annual Report on Form 10-K for 1990 (SEC
File #0-752), which Exhibit 10(i) is
incorporated herein by reference thereto.
(i) Agreement dated April 1, 1986 between
Finsider Mining Company, Ltd. and
Westmoreland Coal Sales Company, relating
to a contract for the purchase and sale of
coking coal, and Assignment dated March 1,
1990 from Finsider to ILVA, S.p.A.-
Reference is hereby made to Exhibit 10(j)
to Westmoreland's Annual Report on Form 10-
K for 1990 (SEC File #0-752), which Exhibit
10(j) is incorporated herein by reference
thereto.
(j) Effective January 1, 1992, the Board of
Directors established a Supplemental
Executive Retirement Plan ("SERP") for
certain executive officers and other key
individuals, to supplement Westmoreland's
Retirement Plan by not being limited to
certain Internal Revenue Code limitations.
A description of this SERP is set forth on
page 11 of Westmoreland's definitive proxy
statement dated June 9, 1992, which
description is incorporated herein by
reference thereto.
(k) Amended Coal Mining Agreement between
Westmoreland Resources, Inc. and Crow Tribe
of Indians, dated November 26, 1974, as
further amended in 1982, filed as Exhibit
(10)(a) to Westmoreland's Quarterly Report
on Form 10-Q for the quarter ended March
31, 1992, is incorporated by reference
thereto.
(l) Amendment and Restatement of Virginia Lease
between Penn Virginia Resources Corporation
and Westmoreland, effective as of July 1,
1988, as further amended May 6, 1992, filed
as Exhibit 10(b) to Westmoreland's
Quarterly Report on Form 10-Q for the
quarter ended March 31, 1992, is
incorporated by reference thereto.
(m) Amendment and Restatement of Hampton Lease
between Penn Virginia Resources Corporation
and Westmoreland, effective as of July 1,
1988, as further amended May 6, 1992, filed
as Exhibit 10(c) to Westmoreland's
Quarterly Report on Form 10-Q for the
quarter ended March 31, 1992, is
incorporated by reference thereto.
(n) Acquisition Agreement, dated May 6, 1992 by
and among Westmoreland, Penn Virginia
Corporation and Penn Virginia Equities
Corporation, including as Exhibit A
thereto, a form of agreement to be executed
by the parties on the Closing Date
described therein, filed as Exhibit 10(d)
to Westmoreland's Quarterly Report on Form
10-Q for the quarter ended March 31, 1992,
is incorporated by reference thereto.
(o) Agreement dated July 9, 1992 by and among
Westmoreland, Penn Virginia Corporation and
Penn Virginia Equities Corporation, with
respect to (i) registration rights granted
to Penn Virginia, (ii) the number of
directors which Penn Virginia for a period
of two years may designate to be elected to
Westmoreland's Board of Directors and (iii)
other conditions, as set forth therein,
which is discussed in Item 13 of
Westmoreland's Form 10-K for 1992.
(p) Agreement dated October 9, 1992 by and
among Westmoreland, Penn Virginia
Corporation and Penn Virginia Equities
Corporation amending and modifying prior
agreements by and among the parties as set
forth therein, which is discussed in Item
13 of Westmoreland's Form 10-K for 1992.
Exhibits 10(a), (b), (c), (g), (h) and (j)
represent management contracts or
compensatory plan arrangements required to
be filed as exhibits, pursuant to Item
14(c) of this report.
(13) Annual Report to Security Holders. The
Westmoreland Coal Company 1993 Annual Report to
Shareholders, has not yet been distributed to
shareholders.
(21) Subsidiaries of the Registrant
(23) Consent of Independent Certified Public
Accountants
b) Reports on Form 8-K.
(1) On November 1, 1993 Westmoreland Coal Company filed a
Report on Form 8-K. This report contained discussion
related to the intended sale of its subsidiary,
Westmoreland Energy, Inc. and its press release dated
November 1, 1993 as an exhibit.
(2) On December 2, 1993 Westmoreland Coal Company filed a
Report on Form 8-K. This report contained discussion
related to the termination of its proposed sale of
Westmoreland Energy, Inc. to California Energy
Company, Inc. and its press release dated December 1,
1993 as an exhibit.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities and Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
WESTMORELAND COAL COMPANY
April 15, 1994 By /s/ Francis J. Boyle
Francis J. Boyle
Senior Vice President,
Chief Financial
Officer & Treasurer
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates
indicated.
Signature Title Date
Principal Executive Officer:
President,
Chief Executive Officer
/s/ Christopher K. Seglem and Director April 15, 1994
Christopher K. Seglem
Directors:
/s/ Pemberton Hutchinson Chairman of the Board April 15, 1994
Pemberton Hutchinson
/s/ E. B. Leisenring, Jr. Director April 15, 1994
E. B. Leisenring, Jr.
/s/ William R. Klaus Director April 15, 1994
William R. Klaus
/s/ A. Linwood Holton, Jr. Director April 15, 1994
A. Linwood Holton, Jr.
/s/ Brenton S. Halsey Director April 15, 1994
Brenton S. Halsey
/s/ Edwin E. Tuttle Director April 15, 1994
Edwin E. Tuttle
/s/ Lennox K. Black Director April 15, 1994
Lennox K. Black
Principal Accounting Officer:
/s/ Thomas C. Sharpe Acting Controller April 15, 1994
Thomas C. Sharpe
Independent Auditors' Report
The Board of Directors and Shareholders
Westmoreland Coal Company:
We have audited the consolidated financial statements of
Westmoreland Coal Company and subsidiaries as listed in the
accompanying index. In connection with our audits of the
consolidated financial statements, we also have audited the
financial statement schedules as listed in the accompanying index.
These consolidated financial statements and financial statement
schedules are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated
financial statements and financial statement schedules based on
our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of Westmoreland Coal Company and subsidiaries as of
December 31, 1993 and 1992, and the results of their operations
and their cash flows for each of the years in the three year
period ended December 31, 1993 in conformity with generally
accepted accounting principles. Also in our opinion, the related
financial statement schedules, when considered in relation to the
basic consolidated financial statements taken as a whole, present
fairly, in all material respects, the information set forth
therein.
As discussed in Note 10 to the consolidated financial statements,
the Company adopted the provisions of the Financial Accounting
Standards Board's Statement of Financial Accounting Standards No.
106, Employers' Accounting for Postretirement Benefits Other Than
Pensions, in 1993.
The accompanying consolidated financial statements and financial
statement schedules have been prepared assuming that
Westmoreland Coal Company will continue as a going concern.
As discussed in Note 1 to the consolidated financial
statements, the Company has suffered recurring losses from
operations, is in violation of various covenants in its
credit arrangements and other obligations and has a net
working capital deficiency that raise substantial doubt about
its ability to continue as a going concern. Management's
plans in regard to these matters are also described in Note
1. The consolidated financial statements and financial
statement schedules do not include any adjustments that might
result from the outcome of this uncertainty.
KPMG Peat Marwick
April 15, 1994
Philadelphia, PA
WESTMORELAND COAL COMPANY AND
SUBSIDIARIES
Index to Financial Statements
The consolidated balance sheets of the Company and subsidiaries as
of December 31, 1993 and December 31, 1992, and the related
consolidated statements of income, shareholders' equity and cash
flows for each of the years in the three-year period ended
December 31, 1993 together with the related notes and the summary
of significant accounting policies are contained on pages 56-108.
The following schedules should be read in conjunction with the
consolidated financial statements of the Company contained on
pages 33-36. Schedules not included have been omitted because
they are not applicable or the required information is presented
in the consolidated financial statements or related notes.
Year ended or
at December 31
Schedules submitted:
V - Property, plant and equipment 1993, 1992, 1991
VI - Accumulated depreciation and
depletion of property, plant and 1993, 1992, 1991
equipment
VIII - Valuation and qualifying accounts 1993, 1992, 1991
X - Supplementary income statement
information 1993, 1992, 1991
Schedule V
WESTMORELAND COAL COMPANY AND
SUBSIDIARIES
Property, Plant and Equipment
Years ended December 31, 1993, 1992 and
1991
(in thousands)
Balance at Retirements
Balance
beginning Additions or
Reclassifications at end
of year at cost sales
Transfers of year
Year ended December 31, 1993:
Land and mineral rights $ 58,629 - 25,791
- - 32,838
Plant and equipment 347,686 8,134 25,473
732 331,079
Furniture and fixtures 1,411 58 406
(71) 992
Automobiles and trucks 8,295 106 741
(892) 6,768
$416,021 8,298 52,411 (A)
(231) (B) 371,677
Year ended December 31, 1992:
Land and mineral rights $ 58,630 - 1
- - 58,629
Plant and equipment 318,142 32,831 3,287
- - 347,686
Furniture and fixtures 1,388 28 5
- - 1,411
Automobiles and trucks 7,988 870 563
- - 8,295
$386,148 33,729 3,856
- - 416,021
Year ended December 31, 1991:
Land and mineral rights $ 58,554 78 2
- - 58,630
Plant and equipment 315,497 14,115 11,470
- - 318,142
Furniture and fixtures 1,352 42 6
- - 1,388
Automobiles and trucks 6,551 1,531 94
- - 7,988
$381,954 15,766 11,572
- - 386,148
(A) $40,865 of this amount relates to write-downs of assets. See
Note 2 to the Consolidated
Financial Statements.
(B) Removes balances related to WEI which is presented as a
discontinued operation.
Schedule VI
WESTMORELAND COAL COMPANY AND
SUBSIDIARIES
Accumulated Depreciation and Depletion
of
Property, Plant and Equipment
Years ended December 31, 1993, 1992 and
1991
(in thousands)
Balance at Additions Retirements
Balance
beginning charged to sales and
Reclassifications at end
of year earnings adjustments
Transfers of year
Year ended December 31, 1993:
Depletion of mineral rights $ 6,272 1,204 25
(47) 7,404
Plant and equipment 198,914 18,942 7,205
284 210,935
Furniture and fixtures 1,195 35 374
(8) 848
Automobiles and trucks 5,589 1,259 495
(313) 6,040
$ 211,970 21,440 8,099
(84) (A) 225,227
Year ended December 31, 1992:
Depletion of mineral rights $ 5,113 1,158 (1)
- - 6,272
Plant and equipment 181,606 20,434 3,126
- - 198,914
Furniture and fixtures 1,157 40 2
- - 1,195
Automobiles and trucks 5,117 938 466
- - 5,589
$ 192,993 22,570 3,593
- - 211,970
Year ended December 31, 1991:
Depletion of mineral rights $ 3,919 1,188 (6)
- - 5,113
Plant and equipment 170,917 21,221 10,532
- - 181,606
Furniture and fixtures 1,112 50 5
- - 1,157
Automobiles and trucks 4,876 670 429
- - 5,117
$ 180,824 23,129 10,960
- - 192,993
(A) Removes balances related to WEI which is presented as a
discontinued operation.
Schedule VIII
WESTMORELAND COAL COMPANY AND
SUBSIDIARIES
Valuation and Qualifying Accounts
Years ended December 31, 1993, 1992 and
1991
(in thousands)
Balance at Additions(deductions)
Other Balance
beginning charged(credited)
additions at end
of year to earnings
(deductions) of year
Year ended December 31, 1993:
Allowance for doubtful accounts $ 31,813 (257)
(3,026) 28,530
Accrual for workers' compensation $ 16,370 17,204
(7,117) 26,457
Accrual for pneumoconiosis benefits $ 19,522 (2,047)
- - 17,475
Accrual for postretirement medical
costs $ - 48,721 (A)
(11,431) 37,290
Year ended December 31, 1992:
Allowance for doubtful accounts $ 2,416 29,055
342 31,813
Accrual for workers' compensation $ 10,879 11,033
(5,542) 16,370
Accrual for pneumoconiosis benefits $ 21,501 (1,979)
- - 19,522
Year ended December 31, 1991:
Allowance for doubtful accounts $ 2,964 107
(655) 2,416
Accrual for workers' compensation $ 10,633 5,832
(5,586) 10,879
Accrual for pneumoconiosis benefits $ 22,944 (1,443)
- - 21,501
Amounts above include current and non-current valuation accounts.
(A) See Note 10 to the Consolidated Financial Statements.
Schedule X
WESTMORELAND COAL COMPANY AND SUBSIDIARIES
Supplementary Income Statement Information
Years ended December 31, 1993, 1992 and 1991
Charged to expense
Item 1993 1992 1991
(in thousands)
Maintenance and repairs $27,630 $24,661 $25,595
Taxes, other than payroll
and income taxes:
Federal pneumoconiosis
excise tax 7,487 7,171 6,584
Sales and severance taxes 9,577 8,918 8,433
Other 6,111 5,508 4,766
Royalties 13,611 13,359 11,708
All other classifications, as required by the Securities and
Exchange Commission, are omitted as such individual amounts
do not exceed one percent of sales.