Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - CNX Resources Corp | d240992d8k.htm |
| EX-99.1 - PRESS RELEASE - CNX Resources Corp | d240992dex991.htm |
Exhibit 99.2
The following unaudited pro forma combined financial statements are based on CONSOL Energy’s historical consolidated financial statements and adjusted to give effect to the September 30, 2011 sale of a 50% interest in certain Marcellus Shale assets. The unaudited pro forma combined statements of operations for the six months ended June 30, 2011 and the twelve months ended December 31, 2010 give effect to the Marcellus Shale asset disposition as if it had occurred on January 1, 2010. The unaudited pro forma combined balance sheet as of June 30, 2011 gives effect to this disposition as if it had occurred on June 30, 2011.
The following statements of operations for the six months ended June 30, 2011 and the twelve months ended December 31, 2010 include the following pro forma adjustments:
| • | Sales – Outside has been adjusted downward to reflect the 50% reduction in sales revenue excluding hedging gains. |
| • | Cost of Goods Sold, Depreciation, Depletion and Amortization, and Taxes Other Than Income have been adjusted downward to reflect the impact of the sale. |
| • | Selling, General and Administrative Expenses have been adjusted downward to reflect the impact of the joint venture overhead recovery arrangement. |
| • | Income Taxes are reflected using the current effective tax rate on recurring earnings. |
| • | Non-controlling interest adjustment reflects the period of time that CONSOL Energy did not wholly own CNX Gas Corporation. |
| For the Six Months Ended June 30, 2011 |
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| Historical | Pro Forma Adjustments |
Pro Forma Results |
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| Sales - Outside |
2,871,478 | (23,585 | ) | 2,847,893 | ||||||||
| Sales - Gas Royalty Interests |
35,108 | — | 35,108 | |||||||||
| Sales - Purchased Gas |
2,142 | — | 2,142 | |||||||||
| Freight - Outside |
96,440 | — | 96,440 | |||||||||
| Other Income |
48,137 | — | 48,137 | |||||||||
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| Total Revenue and Other Income |
3,053,305 | (23,585 | ) | 3,029,720 | ||||||||
| Cost of Goods Sold and Other Operating Charges |
1,741,108 | (6,306 | ) | 1,734,802 | ||||||||
| Acquisition and Financing Fees |
— | — | — | |||||||||
| Loss on Debt Extinguishment |
16,090 | — | 16,090 | |||||||||
| Gas Royalty Interests Costs |
31,173 | — | 31,173 | |||||||||
| Purchased Gas Costs |
2,452 | — | 2,452 | |||||||||
| Freight Expense |
96,251 | — | 96,251 | |||||||||
| Selling, General and Administrative Expenses |
83,619 | (398 | ) | 83,221 | ||||||||
| Depreciation, Depletion and Amortization |
306,862 | (9,629 | ) | 297,233 | ||||||||
| Abandonment of Long-Lived Assets |
115,479 | — | 115,479 | |||||||||
| Interest Expense |
131,079 | — | 131,079 | |||||||||
| Taxes Other Than Income |
179,331 | (127 | ) | 179,204 | ||||||||
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| Total Costs |
2,703,444 | (16,460 | ) | 2,686,984 | ||||||||
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| Earnings Before Income Taxes |
349,861 | (7,125 | ) | 342,736 | ||||||||
| Income Taxes |
80,328 | (1,636 | ) | 78,692 | ||||||||
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| Net Income |
269,533 | (5,489 | ) | 264,044 | ||||||||
| Less: Net Income Attributable to Noncontrolling Interest |
— | — | — | |||||||||
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| Net Income Attributable to CONSOL Energy Inc. Shareholders |
269,533 | (5,489 | ) | 264,044 | ||||||||
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| Earnings Per Share: |
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| Basic |
1.19 | (0.02 | ) | 1.17 | ||||||||
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| Dilutive |
1.18 | (0.02 | ) | 1.16 | ||||||||
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| Weighted Average Number of Common Shares Outstanding |
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| Basic |
226,499,994 | 226,499,994 | 226,499,994 | |||||||||
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| Dilutive |
228,917,335 | 228,917,335 | 228,917,335 | |||||||||
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| Dividends Paid Per Share |
0.20 | — | 0.20 | |||||||||
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| For the Year Ended December 31, 2010 |
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| Historical | Pro Forma Adjustments |
Pro Forma Results |
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| Sales - Outside |
4,938,703 | (22,890 | ) | 4,915,813 | ||||||||
| Sales - Gas Royalty Interests |
62,869 | — | 62,869 | |||||||||
| Sales - Purchased Gas |
11,227 | — | 11,227 | |||||||||
| Freight - Outside |
125,715 | — | 125,715 | |||||||||
| Other Income |
97,507 | — | 97,507 | |||||||||
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| Total Revenue and Other Income |
5,236,021 | (22,890 | ) | 5,213,131 | ||||||||
| Cost of Goods Sold and Other Operating Charges |
3,262,327 | (7,570 | ) | 3,254,757 | ||||||||
| Acquisition and Financing Fees |
65,363 | — | 65,363 | |||||||||
| Gas Royalty Interests Costs |
53,775 | — | 53,775 | |||||||||
| Purchased Gas Costs |
9,736 | — | 9,736 | |||||||||
| Freight Expense |
125,544 | — | 125,544 | |||||||||
| Selling, General and Administrative Expenses |
150,210 | (352 | ) | 149,858 | ||||||||
| Depreciation, Depletion and Amortization |
567,663 | (13,146 | ) | 554,517 | ||||||||
| Interest Expense |
205,032 | — | 205,032 | |||||||||
| Taxes Other Than Income |
328,458 | (48 | ) | 328,410 | ||||||||
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| Total Costs |
4,768,108 | (21,116 | ) | 4,746,992 | ||||||||
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| Earnings Before Income Taxes |
467,913 | (1,774 | ) | 466,139 | ||||||||
| Income Taxes |
109,287 | (412 | ) | 108,875 | ||||||||
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| Net Income |
358,626 | (1,362 | ) | 357,264 | ||||||||
| Less: Net Income Attributable to Noncontrolling Interest |
(11,845 | ) | 57 | (11,788 | ) | |||||||
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| Net Income Attributable to CONSOL Energy Inc. Shareholders |
346,781 | (1,305 | ) | 345,476 | ||||||||
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| Earnings Per Share: |
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| Basic |
1.61 | (0.01 | ) | 1.60 | ||||||||
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| Dilutive |
1.60 | (0.01 | ) | 1.59 | ||||||||
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| Weighted Average Number of Common Shares Outstanding |
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| Basic |
214,920,561 | 214,920,561 | 214,920,561 | |||||||||
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| Dilutive |
217,037,804 | 217,037,804 | 217,037,804 | |||||||||
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| Dividends Paid Per Share |
0.40 | — | 0.40 | |||||||||
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The pro forma balance sheet at June 30, 2011 includes the following adjustments.
| • | The pro forma statement of operations adjustments for Sales – Outside, Cost of Goods Sold, and Taxes Other Than Income have been reflected as pro forma adjustments to Cash and Cash Equivalents. |
| • | The pro forma statement of operations adjustments for Depreciation, Depletion and Amortization have been reflected as pro forma adjustments to Accumulated Depreciation, Depletion and Amortization. |
| • | The pro forma statement of operations adjustments for income taxes have been reflected in Recoverable Income Taxes and Deferred Income Taxes. |
| • | The pro forma statement of operations adjustments for Net Income Attributable to Noncontrolling Interest have been reflected in Capital in Excess of Par Value. |
Material Nonrecurring Charges or Credits and Related Tax Effects
| • | The cash proceeds received have been reflected in Cash and Cash Equivalents after giving effect to the pay down of Accounts Receivable – Securitized and Short-Term Notes Payable as well as the impact of the carry. |
| • | The discounted note receivable received in the transaction is reflected in the Other Receivables balance sheet line item for the portion of the note due in one year and Other Assets for the portion of the note due in 2013. |
| • | The adjustment to Property, Plant and Equipment reflects a 50% reduction of the book value of the assets involved in the transaction as well as the impact of the carry. |
| • | The net loss on the transaction is reflected as an adjustment to Retained Earnings. |
| Historical | Pro Forma Adjustments |
Material Nonrecurring Charges or Credits and Related Tax Effects |
Pro Forma Results |
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| Current Assets |
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| Cash and Cash Equivalents |
26,519 | (31,674 | ) | 204,043 | 198,888 | |||||||||||
| Accounts and Notes Receivable: |
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| Trade |
433,626 | 70,000 | 503,626 | |||||||||||||
| Other Receivables |
23,318 | 311,754 | 335,072 | |||||||||||||
| Accounts Receivable - Securitized |
70,000 | (70,000 | ) | — | ||||||||||||
| Inventories |
259,663 | 259,663 | ||||||||||||||
| Deferred Income Taxes |
174,612 | 174,612 | ||||||||||||||
| Recoverable Income Taxes |
44,920 | 1,822 | 46,742 | |||||||||||||
| Prepaid Expenses |
118,192 | 118,192 | ||||||||||||||
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| Total Current Assets |
1,150,850 | (29,852 | ) | 515,797 | 1,636,795 | |||||||||||
| Property, Plant and Equipment |
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| Property, Plant and Equipment |
15,070,923 | (1,226,685 | ) | 13,844,238 | ||||||||||||
| Less - Accumulated Depreciation, Depletion and Amortization |
4,826,375 | (22,775 | ) | (19,372 | ) | 4,784,228 | ||||||||||
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| Total Property, Plant and Equipment - Net |
10,244,548 | 22,775 | (1,207,313 | ) | 9,060,010 | |||||||||||
| Other Assets |
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| Deferred Income Taxes |
461,581 | 226 | 461,807 | |||||||||||||
| Restricted Cash |
20,291 | 20,291 | ||||||||||||||
| Investment in Affiliates |
100,951 | 100,951 | ||||||||||||||
| Other |
222,897 | 296,344 | 519,241 | |||||||||||||
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| Total Other Assets |
805,720 | 226 | 296,344 | 1,102,290 | ||||||||||||
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| Total Assets |
12,201,118 | (6,851 | ) | (395,172 | ) | 11,799,095 | ||||||||||
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| Historical | Pro Forma Adjustments |
Material Nonrecurring Charges or Credits and Related Tax Effects |
Pro Forma Results |
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| Current Liabilities |
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| Accounts Payable |
351,356 | 351,356 | ||||||||||||||
| Short-Term Notes Payable |
260,750 | (260,750 | ) | — | ||||||||||||
| Current Portion of Long-Term Debt |
25,283 | 25,283 | ||||||||||||||
| Borrowings Under Securitization Facility |
70,000 | (70,000 | ) | — | ||||||||||||
| Other Accrued Liabilities |
836,862 | 836,862 | ||||||||||||||
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| Total Current Liabilities |
1,544,251 | — | (330,750 | ) | 1,213,501 | |||||||||||
| Long-Term Debt |
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| Long-Term Debt |
3,126,061 | 3,126,061 | ||||||||||||||
| Capital Lease Obligations |
56,186 | 56,186 | ||||||||||||||
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| Total Long-Term Debt |
3,182,247 | — | — | 3,182,247 | ||||||||||||
| Deferred Credits and Other Liabilities |
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| Postretirement Benefits Other Than Pensions |
3,085,834 | 3,085,834 | ||||||||||||||
| Pneumoconiosis Benefits |
175,523 | 175,523 | ||||||||||||||
| Mine Closing |
401,439 | 401,439 | ||||||||||||||
| Gas Well Closing |
116,096 | 116,096 | ||||||||||||||
| Workers’ Compensation |
149,025 | 149,025 | ||||||||||||||
| Salary Retirement |
136,366 | 136,366 | ||||||||||||||
| Reclamation |
46,661 | 46,661 | ||||||||||||||
| Other |
149,627 | 149,627 | ||||||||||||||
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| Total Deferred Credits and Other Liabilities |
4,260,571 | — | — | 4,260,571 | ||||||||||||
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| Total Liabilities |
8,987,069 | — | (330,750 | ) | 8,656,319 | |||||||||||
| Stockholders’ Equity |
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| Common Stock, $.01 Par Value; 500,000,000 Shares Authorized, 227,289,426 Issued and 226,695,195 Outstanding at June 30, 2011 |
2,273 | 2,273 | ||||||||||||||
| Capital in Excess of Par Value |
2,207,429 | (57 | ) | 2,207,372 | ||||||||||||
| Preferred Stock, 15,000,000 shares authorized, None issued and outstanding |
— | — | ||||||||||||||
| Retained Earnings |
1,883,610 | (6,794 | ) | (64,422 | ) | 1,812,394 | ||||||||||
| Accumulated Other Comprehensive Loss |
(850,554 | ) | (850,554 | ) | ||||||||||||
| Common Stock in Treasury, at Cost - 594,231 Shares at June 30, 2011 |
(23,580 | ) | (23,580 | ) | ||||||||||||
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| Total CONSOL Energy Inc. Stockholder’s Equity |
3,219,178 | (6,851 | ) | (64,422 | ) | 3,147,905 | ||||||||||
| Noncontrolling Interest |
(5,129 | ) | (5,129 | ) | ||||||||||||
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| Total Equity |
3,214,049 | (6,851 | ) | (64,422 | ) | 3,142,776 | ||||||||||
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| Total Liabilities and Equity |
12,201,118 | (6,851 | ) | (395,172 | ) | 11,799,095 | ||||||||||
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