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These statements are made on the basis of management's views and assumptions regarding feature events and business performance as of the time the statements were made. Because these forward-looking statements are subject to various risks and uncertainties, actual results may differ materially from those implied.Factors that could cause actual results to differ materially are contained in our filings from time to time with the Securities and Exchange Commission and are also contained in our press release dated July 28th, 2010. Non-GAAP financial measures will also be discussed. You will find a reconciliation of the differences between the non-GAAP financial measures and the most directly comparable GAAP financial measures at the end of our press release, a copy of which has been posted to our website. At this time I'd like to turn the call over to Ben Hatfield for his opening remarks. Ben Hatfield Thank you for joining us this morning. We enjoyed solid operating performance in the second quarter. Our focus on increasing sales of metallurgical coal and on effective cost control helped drive margin improvement with margins increasing 26% compared to the second quarter of 2009. Our second quarter results also benefitted from the first overseas delivery of a new ADDCAR highwell mining system. Adjusted EBITDA for the second quarter of 2010 was $44.8 million. Although results for the quarter were adversely affected by a $10 million charge for a negotiated early termination of a thermal coal sales agreement, we view the transaction as a very positive development. It enables us to sell 400,000 tones of previously committed thermal coal as a premium high volatile metallurgical coal at significantly higher prices in 2010 and 2011. Approximately 80% of thus tones have already been committed. Net income for the quarter was $4.5 million or $0.02 per share on a diluted basis. In addition to the contract termination charge, these results reflect a $6.1 million loss on extinguishment of debt related to our capital restructuring.
Thermal coal processing steadily improved in the second quarter as utility coal inventories continued falling from their record high's in November 2009 and approached more normalized levels. This summer's warm temperatures are expected to further reduce stockpiles and support higher prices. Although the demand for metallurgical coal slowed in the second half of the quarter, we believe this is a brief plateau and not indicative of an extended change in the market outlook.At this time I'd like to turn the call over to Brad Harris, our Chief Financial Officer. Brad Harris Thanks Ben. In the second quarter of 2010 we reported total revenues of $300.4 million including $270.7 million attributable to coal sales of 4.1 million tones. Second quarter 2009 revenues totaled $277.8 million of which $254.7 million was attributable to coal sales of 4.2 million tones. Adjusted EBITDA for the second quarter of 2010 was $44.8 million, net of the previously mentioned $10 million contract termination charge. Adjusted EBIDTA in the second quarter of 2009 was $52.2 million, including a $7.7 million gain related to a contract termination. Exclusive of these items adjusted EBITDA would have been $54.8 million in 2010 and $44.5 million in 2009, a 23% increase. Net income for the second quarter of 2010 was $4.5 million or $0.02 per share on a diluted basis, compared to net income of $10.4 million or $0.07 per share for the same quarter a year ago. In addition to the contract termination charge, net income for the second quarter of 2010 also included a $6.1 million pre-tax loss on extinguishment of debt related to the company's capital restructuring. Excluding the $10 million contract termination charge and the $6.1 million pre-tax loss on debt extinguishment, pro-forma net income in the second quarter of 2010 would have $13.5 million or $0.07 per share on a diluted basis. Excluding the $7.7 million gain related to the contract termination, pro-forma net income for the second quarter of 2009 would have $5.6 million or $0.04 per share on a diluted basis. Read the rest of this transcript for free on seekingalpha.com