Alliance Resource Partners (ARLP) Reports Mixed Q2 2025 Results

Alliance Resource Partners, L.P. (NASDAQ: ARLP) released its financial and operating results for the second quarter of 2025, revealing a mixed performance amid market challenges. The company also provided updated guidance for the remainder of the year, reflecting adjustments in expectations due to operational realities and market conditions.

Alliance Resource Partners, L.P. Reports Mixed Results for Q2 2025

Alliance Resource Partners, L.P. (NASDAQ: ARLP) reported a total revenue of $547.5 million for the second quarter of 2025, a 7.7% decrease compared to the same period in 2024.

This decline was primarily attributed to reduced coal sales prices and lower transportation revenues, despite a 6.8% increase in coal sales volumes. The company’s net income for the quarter was $59.4 million, or $0.46 per basic and diluted limited partner unit, significantly below the $100.2 million, or $0.77 per unit, reported in the second quarter of 2024. The decrease in net income was influenced by lower revenues, increased depreciation, and a $25.0 million non-cash impairment loss related to an investment in a battery materials company.

When compared to the first quarter of 2025, ARLP’s total revenues increased by $7.0 million, driven mainly by higher coal sales volumes. However, net income saw a decline of $14.6 million, largely due to the impairment loss and increased operating and depreciation expenses. Adjusted EBITDA for the second quarter of 2025 was $161.9 million, a slight decrease from $181.4 million in the second quarter of 2024, but 1.2% higher than the first quarter of 2025.

Segment performance varied, with the Illinois Basin experiencing a 15.2% increase in coal sales volumes compared to the second quarter of 2024, while Appalachia saw a 16.8% decrease. Coal sales prices per ton dropped by 10.1% in the Illinois Basin and 5.8% in Appalachia compared to the previous year. Despite these challenges, the company achieved record monthly shipping volumes at its Hamilton and River View mines in June 2025.

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ARLP Updates Guidance for Full Year 2025

Looking ahead, Alliance Resource Partners has updated its guidance for the full year 2025, reflecting adjustments in coal sales expectations and operational realities. The company anticipates total coal sales volumes to range between 32.75 million and 34.00 million tons, with a slight increase in the Illinois Basin offset by a reduction in Appalachia due to lower production at Tunnel Ridge and a customer default at MC Mining.

In the Oil & Gas Royalties segment, ARLP has raised its guidance for BOE volumes by approximately 5%, driven by strong volume performance despite lower oil prices affecting royalty revenue. The company remains optimistic about the high quality of its acreage position and the organic growth potential within its portfolio.

CEO Joseph W. Craft III emphasized the strong fundamentals in the domestic thermal market, supported by data center expansion and increased domestic manufacturing.

The recent legislative and regulatory actions, including the One Big Beautiful Bill Act and executive orders addressing grid reliability, have created a favorable environment for coal, which ARLP believes is crucial for energy security. The company is cautiously optimistic about opportunities to grow sales volumes in the coming years, with expectations of maintaining margins near current levels through increased production and completed capital projects.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.