This action comes as the coal company reduced met coal production at North Goonyella Mine in Central Queensland, Australia, by a rate of 1.5mm tons per year and has taken a cut across its corporate cost structure, analysts said.
Today, the company announced plans to cut 250 corporate and regional employees and close two offices, according to The Associated Press. The layoffs are necessary to lower costs, CEO Glenn Kellow stated.
While cost cuts and production cuts help, weak demand and low profitability remain widespread, as Chinese trade data released Monday reiterated one part of the challenge for coal. In May, China's coal imports fell 40.7% y/y and 25.6% m/m, according to the analyst note.
On Tuesday, shares are climbing 6.21% to $3.25.
Separately, TheStreet Ratings team rates PEABODY ENERGY CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate PEABODY ENERGY CORP (BTU) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow."