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For the second quarter, net income attributable to Consol Energy shareholders rose 12% to $113.34 million or $0.62 per share from $101.01 million or $0.54 per share in the same quarter a year ago.

On average, eleven analysts polled by Thomson Reuters expected earnings of $0.81 per share for the quarter. Analysts' estimate typically excludes one-time items.

Total revenue and other income for the Canonsburg,Pennsylvania-based company dropped to $1.07 billion from $1.21 billion in the prior-year quarter, missing Street estimates of $1.14 billion.

Revenues were negatively impacted by lower gas pricing and lower coal sales, but was partially offset by coal customer contract buyouts that resulted in $14 million of other income, pretax.

In the preceding first quarter, Consol Energy reported a profit more than doubled to $195.82 million or $1.08 per share, as revenues rose 18.8% to $1.219 billion in the comparable quarter last year.

Amongst others in the industry, Arch Coal, Inc. (ACI), in its second quarter, reported a slip to loss of $15.1 million or $0.11 per share, reflecting additional equipment idling, production reductions and continued weakness in market demand. Revenues was $554.6 million for the quarter.

Another player, Massey Energy Co. (MEE) reported a swing to profit of $20.2 million or $0.24 per share in its second quarter, helped by lower expenses, which somewhat offset lower revenues. Total revenues were $697.6 million for the quarter.

Peabody Energy Corp. (BTU), in its second quarter, reported a profit that plunged to $79.2 million or $0.29 per share from $233.3 million or $0.85 per share, helped by softer demand in a difficult operating environment. Revenues for the quarter was $1.34 billion

For the quarter under review, outside sales of Consol Energy were dropped 10.6% to $994.14 million, while sales from Gas royalty interests more than halved to $8.67 million from the year-earlier quarter. Sales of purchased gas and freight also declined from a year ago.

Total coal sales were down to 13.4 million tons in the June 2009 quarter, from 17.5 million tons as the weak economy reduced coal burn at utilities and coal needs of steel companies. Coal production was 14.4 million tons, down from 16.6 million tons in the year-earlier quarter.

Operating costs per ton was $35.01, or 9% higher than in the year-earlier quarter, reflecting reduced amount of tons produced from Consol Energy mines. Total costs per ton company produced were $45.42 per ton, or 9% higher than in the year-earlier quarter, with most of the increase coming from operating costs.

Total costs for the quarter dropped to $897.31 million from $1.04 billion in the same quarter last year.

Operating margins were $21.35 per ton in the June quarter, an increase of 30% from $16.47 per ton, due to higher realized pricing per ton. Financial margins were $10.94 per ton, a 59% increase from the $6.90 per ton, also due to higher realized pricing.

CNX Gas Corp. (CXG), 83.3% of which is owned by Consol Energy, reported total net income attributable to CNX Gas shareholders of $33.0 million, compared to $64.3 million in the prior-year quarter.

As of June 30, 2009, Consol Energy had $371.0 million of short-term debt and $461.5 million in total liquidity, which is comprised of $100.7 million of cash and $360.8 million available to be borrowed under its $1.0 billion bank facility. As of June 30, 2009, CNX Gas Corporation had $81.0 million of short-term debt and $111.7 million in total liquidity, which is comprised of $7.6 million of cash and $104.1 million available to be borrowed under its $200.0 million bank facility.

For the six-month period, net income attributable to Consol share holders surged to $309.16 million or $1.69 per share from $176.09 million or $0.96 per share in the year-earlier period. Total revenue rose to $2.29 billion from $2.24 billion in the prior-year period.

Looking ahead, the company said it is lowering its 2009 production guidance to 58 million tons from 60 million tons, citing lowered demand created by weakened economy. The company, however, raised its production guidance at CNX Gas to 89 Bcf from 87 Bcf, as results from Marcellus Shale and coalbed methane programs continue to exceed expectations.

Brett Harvey, president and chief executive officer said, "We believe that coal production cuts will continue into next year and that this should bode well for a sustained recovery in coal contract prices."

For the third quarter of 2009, Consol Energy expects production to be approximately 13.1 million tons.

Consol Energy also said it continues to expect to invest $1.0 billion in its coal and gas businesses during calendar year 2009.

On July 15, 2009, brokerage Howard Weil initiated a 'Market Perform' rating on Consol Energy shares, with a mean target of $44.19.

CNX is currently trading at $34.31, down $0.30 or 0.87%, on a volume of $3.07 million shares. In the last 52-week period, the stock traded in the range of $18.50 to $88.85, with a three-month average volume of 3.86 million shares.

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