By St. Louis Business Journal

Arch Coal Inc. said late Tuesday it cut its earnings guidance for 2010 in response to lower shipments.

The St. Louis-based coal company now expects its 2010 earnings per diluted share on a GAAP basis to be between 94 cents per share and 98 cents per share, including amortization of coal supply agreements and early debt extinguishment costs. Excluding these charges, adjusted earnings per diluted share for full year 2010 would be in the range of $1.11 per share to $1.15 per share, which is below the adjusted EPS annual guidance range of $1.25 per share to $1.40 per share the company gave in October.

The company now expects its adjusted earnings before interest, taxes, depreciation, depletion and amortization (EBITDA) to be in the $718 million to $726 million range for full year 2010, which would be the second-highest in company history.

"Lower shipment levels, partially driven by poor Eastern rail service, contributed to the guidance revision for 2010," Arch Chairman and Chief Executive Steven Leer said in a statement. "In addition, the Mountain Laurel operation was impacted in December by geologic challenges, which marginally affected our planned production during the quarter."

"Geologic challenges" are now expected to force the longwall at Mountain Laurel to be idle for most of the first quarter of 2011 while additional development work is completed on the next longwall panel, Arch said. The longwall is scheduled to restart in mid- to late-April. During the outage, Mountain Laurel will supply coal to customers from its five continuous miner operations as well as from existing inventories, the company said.

Arch plans to release its fourth-quarter earnings results before the market opens Jan. 28.

On Wednesday, Arch said it acquired a 38 percent interest in Millennium Bulk Terminals-Longview, LLC, the owner of a bulk commodity terminal near Longview, Wash., for $25 million.

On Monday, a judge rejected Arch's attempt to dismiss lawsuits filed last year by four environmental groups challenging the St. Louis companyâ¿¿s $86 million lease with Montana.

Arch Coal Inc. (NYSE: ACI) is the second-largest U.S. coal producer, fueling roughly 8 percent of the nation's electricity.

Copyright 2011 American City Business Journals

Copyright 2010