Peabody struggles to stay afloat in crumbling industry

St. Louis-based coal company Peabody Energy released its fourth-quarter results that capped off a year in which it lost more than $2 billion.

Peabody is struggling as its peers in the coal industry file for bankruptcy amid a years-long crash in coal prices, tapping credit and selling assets to stay afloat. Its stock closed Thursday at $2.35, down $1.01, after losing almost half its value in the last five days. Its bonds are trading at pennies on the dollar. Its attempts to sell assets and negotiate debt with lenders don’t appear to be persuading investors it won’t join Alpha Natural Resources and Creve Coeur-based Arch Coal in bankruptcy court.

Peabody disclosed Thursday that it had tapped what remained of a $1.65 billion revolving credit facility, borrowing the last $825 million available just this month.

In an investment note on Jan. 21, analysts for J.P. Morgan wrote that they “remain unconvinced that these efforts are sufficient and continue to feel a Chapter 11 filing for Peabody is highly likely.”

Read more: St. Louis Post-Dispatch


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