CONSOL Energy Reports Net Loss of $11 million, or ($0.05) per Diluted Share PR Newswire PITTSBURGH, Oct. 25, 2012 PITTSBURGH, Oct. 25, 2012 /PRNewswire/ --CONSOL Energy Inc. (NYSE: CNX), the leading diversified fuel producer in the Eastern United States, reported a net loss for the quarter ended September 30, 2012 of $11 million, or ($0.05) per diluted share, compared to net income of $167 million, or $0.73 per diluted share from the year-earlier quarter. Adjusted EBITDA^1, a non-GAAP financial measure, was $210 million for the quarter ended September 30, 2012, compared to $441 million in the year-earlier quarter. (Logo: http://photos.prnewswire.com/prnh/20120416/NE87957LOGO) The loss was due to a series of planned and unplanned idlings, as the company scaled back production to meet a weaker market, which will also have a residual impact during the fourth quarter. The one unplanned item was the previously announced collapse of two newly-installed conveyor belts that move coal from the Enlow Fork and Bailey mines to the Bailey Preparation Plant, all in Southwestern Pa. This incident caused a total of four longwalls to be idled for approximately three weeks, at which point one rebuilt conveyor belt was re-started. Production from these mines was at approximately 60% of normal for most of the remainder of the third quarter. The company's third quarter net income would have been an estimated $53 million higher, had the conveyor belt incident not occurred. This impact is before the receipt of any insurance proceeds and any other proceeds under the indemnity provisions of the construction contract. Much lower sales from the company's flagship low-vol Buchanan Mine also reduced third quarter profitability, as the company chose not to sell into a market that was experiencing an inventory de-stocking. "CONSOL is serious about maintaining market discipline," commented J. Brett Harvey, chairman and CEO. "Our premium low-vol coal is a scarce resource. When temporary market imbalances occur as they did this quarter with our overseas customers, we choose to idle our mine rather than force tons into the market. Our actions, as well as the actions of others, should enable the metallurgical coal market to come into balance faster. We have a strong balance sheet with a high level of liquidity, which allows us to exercise production discipline." The lower level of production impaired costs per ton. In the Coal Division across all of its tons, CONSOL Energy had 2012 third quarter fully-loaded costs of $55.84 per ton. This was an increase of $1.46 per ton from the year-earlier quarter. The company expects costs per ton to decrease as its mines return to more normal schedules. Cash flow from operations in the quarter was $162 million, as compared to $457 million in the year-earlier quarter. CONSOL continues to invest in its future, in both coal and gas, by investing $438 million in the 2012 third quarter on capital projects. Some of these capital projects, such as the new BMX Mine, are a multi-year investment. Our plan is to complete the BMX Mine in early 2014 and then reassess the viability of additional coal expansion projects. CONSOL does not expect to invest in new expansion projects until coal markets improve. After investing a projected $1.5 billion in coal and gas projects this year, the company expects to end 2012 with no cash on its balance sheet and nothing drawn against its revolving credit facilities. "The return of Bailey and Enlow Fork mines to normal production at the beginning of the fourth quarter will certainly be helpful for CONSOL's earnings going forward," continued Mr. Harvey. "Strengthening spot gas prices and a projected sequential increase in both coal and gas production will also be helpful. The steel market, though, remains challenging for all of the categories of our metallurgical coals." The Buchanan Mine is expected to restart the week of November 5 with a five-day work week schedule, while Amonate is likely to remain idled for the remainder of 2012. ^1The term "Adjusted EBITDA" is a non-GAAP financial measure, which is defined and reconciled to the GAAP net income below, under the caption "Non-GAAP Financial Measures." Coal Division Results: COAL DIVISION RESULTS BY PRODUCT CATEGORY - Quarter-To-Quarter Comparison Low-Vol Low-Vol High-Vol High-Vol Thermal Thermal Quarter Quarter Quarter Quarter Quarter Quarter Ended Ended Ended Ended Ended Ended September September September September September September 30, 30, 30, 30, 30, 30, 2012 2011 2012 2011 2012 2011 Beginning Inventory 0.4 0.2 — — 2.0 1.6 (millions of tons) Coal Production 0.8 1.4 0.7 1.0 10.1 12.1 (millions of tons) Ending Inventory 0.4 0.1 — — 1.3 1.6 (millions of tons) Sales - Company Produced (millions 0.8 1.5 0.7 1.0 10.7 12.2 of tons) Sales Per Ton $ 135.66 $ 207.21 $ 67.76 $ 82.21 $ 62.11 $ 60.18 Beginning Inventory Cost Per $ 69.84 $ 66.09 $ 63.50 $ — $ 56.03 $ 56.92 Ton Total Direct Costs $ 55.60 $ 39.28 $ 30.10 $ 36.19 $ 33.06 $ 30.92 Per Ton Royalty/Production 8.75 12.42 3.09 4.11 4.46 4.07 Taxes Per Ton Direct Services to 6.83 4.46 7.26 7.33 5.06 5.44 Operations Per Ton Retirement and 8.64 7.58 3.89 5.43 4.04 4.70 Disability Per Ton DD&A Per Ton 11.29 6.74 7.38 7.22 6.70 6.22 Total Production $ 91.11 $ 70.48 $ 51.72 $ 60.28 $ 53.32 $ 51.35 Costs Ending Inventory $ (87.32) $ (67.35) $ — $ — $ (51.55) $ (52.89) Cost Per Ton Total Cost Per Ton $ 83.09 $ 70.08 $ 55.29 $ 60.28 $ 53.81 $ 51.95 Sold Average Margin Per $ 52.57 $ 137.13 $ 12.47 $ 21.93 $ 8.30 $ 8.23 Ton Sold Addback: DD&A Per $ 11.29 $ 6.74 $ 7.38 $ 7.22 $ 6.70 $ 6.22 Ton Average Margin Per $ 63.86 $ 143.87 $ 19.85 $ 29.15 $ 15.00 $ 14.45 Ton, before DD&A Cash Flow before Cap. Ex and DD&A $ 51 $ 216 $ 14 $ 29 $ 161 $ 176 ($MM) Sales and production exclude CONSOL Energy's portion from equity affiliates. Direct Costs per Ton include items such as labor and benefits, supplies, power, preparation costs, project expenses and gas well plugging costs. Direct Services to Operations Per Ton include items such as subsidence costs, direct administrative, selling expenses, permitting and compliance and asset retirement obligations. Retirement and Disability Per Ton Sold includes charges for pension, retiree medical and other employee related long-term liabilities. The treatment of general and administrative has changed; it has been removed from the costs shown in this table for both the current quarter and the year-earlier quarter. Management has decided to allocate G&A to the coal division and the gas division, but will no longer allocate G&A beyond that. Sales times Average Margin Per Ton, before DD&A is meant to approximate the amount of cash generated for the low-vol, high-vol, and thermal coal categories. This cash generation will be offset by maintenance of production (MOP) capital expenditures. The Coal Division results table on the previous page has been re-formatted in order to increase transparency. The realization line has been replaced with a sales line. Inventory adjustments, which had flowed through realizations, are now included in costs. A table containing the recast historic quarterly comparisons for each quarter since the first quarter of 2011 is available on our website. Certain costs were excluded from the table. For the low-vol category in the just-ended quarter, $7 million of Buchanan's costs are not included. For the thermal category, $42 million of Bailey/Enlow Fork's costs are excluded. Excluding the impacts of Buchanan and Bailey/Enlow, noted earlier, CONSOL Energy's coal production costs in the quarter ended September 30, 2012 were $55.84 per ton, or an increase of $1.46, or 3%, from the quarter ended September 30, 2011. The majority of the cost increase was volume related, as there were four additional weeks of longwall idling that lowered volumes during the quarter. Coal production in the quarter consisted of 0.8 million tons of low-vol, 0.7 million tons of high-vol, and 10.1 million tons of thermal, for a total of 11.6 million tons. (Amonate production of 53,000 tons is included in the low-vol category.) Of the thermal coal production, 9.3 million tons were from Northern Appalachia and 0.8 million tons were from Central Appalachia. During the third quarter, thermal coal inventory decreased by 0.8 million tons, when compared to the quarter ended June 30, 2012. Coal Marketing Update: Low-Vol: Low-vol coal continues to be oversupplied in a world economy that has weakened in the last six months. Steel utilization rates remain weak in Europe and Brazil, which are CONSOL's natural export markets. Benchmark settlements between major steel producers and coal suppliers recently settled at prices that, when adjusted for transportation, were lower than expected. Fourth quarter sales estimates range between 0.5 and 0.7 million tons. High-Vol: We expect shipments to China will return to normal levels once a draw down of their inventories is complete. We expect a recovery to occur in the second quarter of 2013 as global steel production improves. U.S. Thermal: Warm summer temperatures and Northern Appalachia production issues coupled with production cutbacks in other basins have contributed to reduced inventories at utility stockpiles. Additionally, the potential return of normal winter weather and the strengthening natural gas price are catalysts for improving domestic thermal markets. CONSOL has 96% of it's Northern Appalachia coal sold for 2013 and has recently completed pricing for over 3.5 million tons of our Bailey thermal product at or in excess of $60 per ton. Global Thermal: CONSOL expects to continue to sell thermal coal into European markets under contract. Gas Division Results: Coalbed Methane (CBM): Total production was 21.7 Bcf, a decrease of 7% from the 23.3 Bcf produced in the year-earlier quarter. Marcellus Shale: Total production was 10.1 Bcf, an increase of 16% from the 8.7 Bcf produced in the year-earlier quarter. Last year's Marcellus Shale production contained 4.5 Bcf that was subsequently sold to Noble Energy and Antero Resources. On a consistent basis, the company's Marcellus Shale production increased by 140% from the year-earlier quarter. Shallow: Total production was 7.0 Bcf, a decrease of 10% from the 7.8 Bcf produced in the year-earlier quarter. The company has been shifting rigs and capital toward higher potential return Marcellus and Utica drilling prospects. Other: Our other category had production of 0.6 Bcf, unchanged from 0.6 Bcf in the year-earlier quarter. The table below summarizes the key metrics for the Gas Division: GAS DIVISION RESULTS — Quarter-to-Quarter Comparison Quarter Quarter Ended Ended September 30, September 30, 2012 2011 Total Revenue and Other Income ($ MM) $ 191.1 $ 203.6 Net Income $ 7.2 $ 2.9 Net Cash from Operating Activities ($ MM) $ 14.7 $ 130.9 Total Period Production (Bcf) 39.5 40.4 Average Daily Production (MMcf) 429 439.6 Capital Expenditures ($ MM) $ 166.6 $ 215.8 Production results are net of royalties. PRICE AND COST DATA PER MCF — Quarter-to-Quarter Comparison The company experienced increased profitability within the Gas Division when compared with the quarter ended September 30, 2011. Unit gas margins decreased despite the improvement in unit costs, as realized unit gas prices fell by $0.73 per Mcf. Total unit gas costs declined, due in part to the continued emphasis on low cost Marcellus Shale drilling, where the company has been drilling longer laterals on multi-well pads. All-in unit costs in the Marcellus Shale were $2.95 per Mcf in the just-ended quarter, a decrease of $0.10 from the $3.05 per Mcf in the year-earlier quarter. Total gathering costs were impaired by $0.13 per Mcf primarily due to increased transportation costs. Quarter Quarter Ended Ended September 30, September 30, 2012 2011 Average Sales Price $4.19 $4.92 Costs - Production Lifting $0.57 $0.76 Ad Valorem, Severance and Other Taxes $0.17 $0.15 DD&A $1.12 $1.22 Total Production Costs $1.86 $2.13 Costs - Gathering Operating Costs $0.65 $0.63 Transportation $0.39 $0.26 DD&A $0.20 $0.22 Total Gathering Costs $1.24 $1.11 Gas Direct Administrative Selling & Other $0.28 $0.36 Total Costs $3.38 $3.60 Margin $0.81 $1.32 Note: Costs − The line item "gas direct administrative, selling, & other" excludes general administration, incentive compensation, and other corporate expenses. CONSOL Energy 2012 Production Guidance CONSOL Energy expects its net gas production to be between 157 - 159 Bcf for the year. Fourth quarter gas production, net to CONSOL, is expected to be approximately 42.5 - 44.5 Bcf. Total hedged gas production in the 2012 fourth quarter is 19.3 Bcf, at an average price of $5.25 per Mcf. The annual gas hedge position for three years is shown in the table below: GAS DIVISION GUIDANCE 2012 2013 2014 Total Yearly Production (Bcf) 157-159 N/A N/A Volumes Hedged (Bcf),as of 10/11/12 76.9 65.4 55.0 Average Hedge Price ($/Mcf) $5.25 $4.73 $4.95 COAL DIVISION GUIDANCE Q4 2012 2012 2013 2014 Estimated Coal Sales (millions 14.0 55.9 56.7 61.8 of tons) Est. Low-Vol Met Sales 0.6 3.4 3.9 4.9 Tonnage: Firm 0.6 3.4 1.1 — Avg. Price: Sold (Firm) $ 134.64 $ 141.72 $ 130.35 $ — Est. High-Vol Met Sales 0.5 3.4 2.7 4.8 Tonnage: Firm 0.5 3.4 0.3 0.3 Avg. Price: Sold (Firm) $ 81.07 $ 65.46 $ 73.23 $ 75.53 Est. Thermal Sales 12.9 49.1 49.5 51.4 Tonnage: Firm 12.6 48.8 35.9 14.9 Avg. Price: Sold (Firm) $ 61.21 $ 61.66 $ 60.63 $ 62.27 Note: While most of the data in the table are single point estimates, the inherent uncertainty of markets and mining operations means that investors should consider a reasonable range around these estimates. N/A means not available or not forecast. CONSOL has chosen not to forecast prices for open tonnage due to ongoing customer negotiations. In the thermal sales category, the open tonnage includes two items: sold, but unpriced tons and collared tons. Collared tons in 2013 are 3.0 million tons, with a ceiling of $52.37 per ton and a floor of $47.37 per ton. Collared tons in 2014 are 7.0 million tons, with a ceiling of $55.90 per ton and a floor of $46.32 per ton. For 2013, when unpriced thermal tons are combined with collared tons, less than 2 million tons remains to be sold. Total Amonate estimated coal sales for Q4 2012 are 0.03 million tons. Calendar years 2012, 2013, and 2014 include 0.03, 0.6, and 0.7 million tons, respectively, from Amonate. The Amonate tons are not included in the category breakdowns. Liquidity Total company liquidity as of September 30, 2012 was $2.6 billion. As of September 30, 2012, CONSOL Energy had $1.477 billion in total liquidity, which is comprised of $39.6 million of cash, $39.2 million available to be borrowed under the accounts receivable securitization facility, and$1,399.7 million available to be borrowed under its $1.5 billion bank facility. CONSOL Energy's credit facility has no borrowings. Outstanding letters of credit are $261.1 million. As of September 30, 2012, CNX Gas Corporation had $1.121 billion in total liquidity, which is comprised of $191.4 million of cash and $929.8 million available to be borrowed under its $1.0 billion bank facility. CNX Gas' credit facility has no borrowings. Outstanding letters of credit are $70.2 million. CONSOL Energy Inc., the leading diversified fuel producer in the Eastern U.S., is a member of the Standard & Poor's 500 Equity Index and the Fortune 500. It has 12 bituminous coal mining complexes in four states and reports proven and probable coal reserves of 4.5 billion tons. It is also a leading Eastern U.S. gas producer, with proved reserves of 3.5 trillion cubic feet. Additional information about CONSOL Energy can be found at its web site: www.consolenergy.com. Non-GAAP Financial Measures Definition: EBIT is defined as earnings before deducting net interest expense (interest expense less interest income) and income taxes. EBITDA is defined as earnings before deducting net interest expense (interest expense less interest income), income taxes and depreciation, depletion and amortization. Adjusted EBITDA is defined as EBITDA after adjusting for the discrete items listed below. Although EBIT, EBITDA, and Adjusted EBITDA are not measures of performance calculated in accordance with generally accepted accounting principles, management believes that it is useful to an investor in evaluating CONSOL Energy because it is widely used to evaluate a company's operating performance before debt expense and its cash or as a substitute for measures of performance in accordance with generally accepted accounting principles. In addition, because all companies do not calculate EBIT, EBITDA, or Adjusted EBITDA identically, the presentation here may not be comparable to similarly titled measures of other companies. Reconciliation of EBIT, EBITDA and Adjusted EBITDA to financial net income attributable to CONSOL Energy Shareholders is as follows (dollars in 000): Three Months Ended September 30, 2012 2011 Net Income $ (11,368) $ 167,329 Add: Interest Expense 54,075 58,884 Less: Interest Income (8,299) (180) Add: Income Taxes (19,898) 33,093 Earnings Before Interest & 14,510 259,126 Taxes (EBIT) Add: Depreciation, 153,877 159,750 Depletion & Amortization Earnings Before Interest, 168,387 418,876 Taxes and DD&A (EBITDA) Adjustments: Bailey Structural Incident 41,873 — Noble Transaction — 58,042 Antero Transaction — (41,208) Bond Amendment Fees — 14,907 Pipeline Right-of-Ways — (10,000) Issuance Asset Abandonment - Mine 84 — 338 Total Pre-tax Adjustments 41,873 22,079 Adjusted Earnings Before Interest, Taxes and DD&A $ 210,260 $ 440,955 (Adjusted EBITDA) Note: Income tax effect of Total Pre-tax Adjustments was ($2,165) and ($7,436) for the three months ended September 30, 2012 and September 30, 2011, respectively. Forward-Looking Statements We are including the following cautionary statement in this document to make applicable and take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for any forward-looking statements made by, or on behalf of us. With the exception of historical matters, the matters discussed in this document are forward-looking statements (as defined in Section21E of the Securities Exchange Act of 1934) that involve risks and uncertainties that could cause actual results to differ materially from projected results. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. The forward-looking statements may include projections and estimates concerning the timing and success of specific projects and our future production, revenues, income and capital spending. When we use the words "believe," "intend," "expect," "may," "should," "anticipate," "could," "estimate," "plan," "predict," "project," or their negatives, or other similar expressions, the statements which include those words are usually forward-looking statements. When we describe strategy that involves risks or uncertainties, we are making forward-looking statements. The forward-looking statements in this document speak only as of the date of this document; we disclaim any obligation to update these statements, and we caution you not to rely on them unduly. We have based these forward-looking statements on our current expectations and assumptions about future events. While our management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. These risks, contingencies and uncertainties relate to, among other matters, the following: deterioration in global economic conditions in any of the industries in which our customers operate, or sustained uncertainty in financial markets cause conditions we cannot predict; a significant or extended decline in prices we receive for our coal and natural gas affecting our operating results and cash flows; our customers extending existing contracts or entering into new long-term contracts for coal; our reliance on major customers; our inability to collect payments from customers if their creditworthiness declines; the disruption of rail, barge, gathering, processing and transportation facilities and other systems that deliver our coal and natural gas to market; a loss of our competitive position because of the competitive nature of the coal and natural gas industries, or a loss of our competitive position because of overcapacity in these industries impairing our profitability; our inability to maintain satisfactory labor relations; coal users switching to other fuels in order to comply with various environmental standards related to coal combustion emissions; the impact of potential, as well as any adopted regulations relating to greenhouse gas emissions on the demand for coal and natural gas; foreign currency fluctuations could adversely affect the competitiveness of our coal abroad; the risks inherent in coal and natural gas operations being subject to unexpected disruptions, including geological conditions, equipment failure, timing of completion of significant construction or repair of equipment, fires, explosions, accidents and weather conditions which could impact financial results; decreases in the availability of, or increases in, the price of commodities or capital equipment used in our mining and natural gas operations; decreases in the availability of, an increase in the prices charged by third party contractors or, failure of third party contractors to provide quality services to us in a timely manner could impact our profitability; obtaining and renewing governmental permits and approvals for our coal and natural gas operations; the effects of government regulation on the discharge into the water or air, and the disposal and clean-up of, hazardous substances and wastes generated during our coal and natural gas operations; the effects of stringent federal and state employee health and safety regulations, including the ability of regulators to shut down a mine or well; the potential for liabilities arising from environmental contamination or alleged environmental contamination in connection with our past or current coal and gas operations; the effects of mine closing, reclamation, gas well closing and certain other liabilities; uncertainties in estimating our economically recoverable coal and gas reserves; costs associated with perfecting title for coal or gas rights on some of our properties; the outcomes of various legal proceedings, which are more fully described in our reports filed under the Securities Exchange Act of 1934; the impacts of various asbestos litigation claims; increased exposure to employee related long-term liabilities; our accruals for obligations for long-term employee benefits are based upon assumptions which, if inaccurate, could result in our being required to expend greater amounts than anticipated; due to our participation in an underfunded multi-employer pension plan, we have exposure under that plan that extends beyond what our obligation would be with respect to our employees and in the future we may have to make additional cash contributions to fund the pension plan or incur withdrawal liability; lump sum payments made to retiring salaried employees pursuant to our defined benefit pension plan exceeding total service and interest cost in a plan year; acquisitions and joint ventures that we recently have completed or entered into or may make in the future including the accuracy of our assessment of the acquired businesses andtheir risks, achieving any anticipated synergies, integrating the acquisitions and unanticipated changes that could affect assumptions we may have made and divestitures we anticipate may not occur or produce anticipated proceeds including joint venture partners paying anticipated carry obligations; the terms of our two significant existing gas joint ventures restrict our flexibility and actions taken by the other party in our gas joint ventures may impact our financial position; the anti-takeover effects of our rights plan could prevent a change of control; risks associated with our debt; replacing our natural gas reserves, which if not replaced, will cause our gas reserves and gas production to decline; our ability to find adequate water sources for use in gas drilling, or our ability to dispose of water used or removed from strata in connection with our gas operations at a reasonable cost and within applicable environmental rules; our hedging activities may prevent us from benefiting from price increases and may expose us to other risks; and other factors discussed in the 2011 Form 10-K under "Risk Factors," as updated by any subsequent Form 10-Qs, which are on file at the Securities and Exchange Commission. CONSOL ENERGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Dollars in thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, 2012 2011 2012 2011 Sales—Outside $ 1,084,041 $ 1,421,689 $ 3,584,805 $ 4,293,167 Sales—Gas Royalty 12,968 17,083 34,707 52,191 Interests Sales—Purchased Gas 953 1,155 2,443 3,297 Freight—Outside 27,430 59,871 126,195 156,311 Other Income 34,697 21,931 293,196 70,068 Total Revenue and Other 1,160,089 1,521,729 4,041,346 4,575,034 Income Cost of Goods Sold and Other Operating Charges (exclusive of 827,530 879,268 2,588,460 2,620,376 depreciation, depletion and amortization shown below) Gas Royalty Interests 10,543 15,409 27,916 46,582 Costs Purchased Gas Costs 737 398 2,123 2,850 Freight Expense 27,430 59,871 126,195 156,122 Selling, General and 36,681 46,692 109,412 130,311 Administrative Expenses Depreciation, Depletion 153,877 159,750 463,048 466,612 and Amortization Interest Expense 54,075 58,884 168,788 189,963 Taxes Other Than Income 80,587 85,790 256,543 265,121 Abandonment of — 338 — 115,817 Long-Lived Assets Loss on Debt — — — 16,090 Extinguishment Transaction and — 14,907 — 14,907 Financing Fees Total Costs 1,191,460 1,321,307 3,742,485 4,024,751 (Loss) Earnings Before (31,371) 200,422 298,861 550,283 Income Taxes Income Taxes (Benefit) (19,898) 33,093 60,428 113,421 Expense Net (Loss) Income (11,473) 167,329 238,433 436,862 Add: Net Loss Attributable to 105 — 134 — Noncontrolling Interest Net (Loss) Income Attributable to CONSOL $ (11,368) $ 167,329 $ 238,567 $ 436,862 Energy Inc. Shareholders Earnings Per Share: Basic $ (0.05) $ 0.74 $ 1.05 $ 1.93 Dilutive $ (0.05) $ 0.73 $ 1.04 $ 1.91 Weighted Average Number of Common Shares Outstanding: Basic 227,654,395 226,744,011 227,491,284 226,582,226 Dilutive 227,654,395 229,163,537 229,191,870 229,002,863 Dividends Paid Per $ 0.125 $ 0.100 $ 0.375 $ 0.300 Share CONSOL ENERGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (Dollars in thousands) Three Months Ended Nine Months Ended September 30, September 30, 2012 2011 2012 2011 Net (Loss) Income $ (11,473) $ 167,329 $ 238,433 $ 436,862 Other Comprehensive (Loss) Income: Treasury Rate Lock (Net of — — — (96) tax: $-, $-, $-, $59) Actuarially Determined Long-Term Liability Adjustments Change in Prior Service Cost (Net of tax: $-,$-, — — 50,276 — ($30,295),$-) Amortization of Prior Service Cost (Net of tax: $5,232, (8,684) (7,365) (24,921) (22,094) $4,584,$15,016, $13,750) Amortization of Net Loss (Net of tax: ($10,007), ($11,438), 16,605 18,379 49,725 55,135 ($29,963), ($34,312)) Net (Decrease) Increase in the Value of Cash Flow Hedge (Net (6,459) 59,620 80,280 92,421 of tax: $4,161, ($38,790), ($51,716), ($59,912)) Reclassification of Cash Flow Hedges from OCI to Earnings (47,809) (20,974) (153,597) (56,719) (Net of tax: $29,683, $13,292, $97,760, $36,746) Other Comprehensive (Loss) (46,347) 49,660 1,763 68,647 Income Comprehensive (Loss) Income (57,820) 216,989 240,196 505,509 Add: Comprehensive Loss Attributable to Noncontrolling 105 — 134 — Interest Comprehensive (Loss) Income Attributable to CONSOL Energy $ (57,715) $ 216,989 $ 240,330 $ 505,509 Inc. Shareholders CONSOL ENERGY INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (Unaudited) September30, December31, 2012 2011 ASSETS Current Assets: Cash and Cash Equivalents $ 230,958 $ 375,736 Accounts and Notes Receivable: Trade 457,057 462,812 Notes Receivable 314,417 314,950 Other Receivables 86,282 105,708 Inventories 266,539 258,335 Deferred Income Taxes 172,212 141,083 Recoverable Income Taxes 12,132 — Prepaid Expenses 170,927 239,353 Total Current Assets 1,710,524 1,897,977 Property, Plant and Equipment: Property, Plant and Equipment 15,143,744 14,087,319 Less—Accumulated Depreciation, Depletion and 5,215,721 4,760,903 Amortization Total Property, Plant and Equipment—Net 9,928,023 9,326,416 Other Assets: Deferred Income Taxes 446,530 507,724 Restricted Cash 20,372 22,148 Investment in Affiliates 213,708 182,036 Notes Receivable 1,460 300,492 Other 235,977 288,907 Total Other Assets 918,047 1,301,307 TOTAL ASSETS $ 12,556,594 $ 12,525,700 CONSOL ENERGY INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except per share data) (Unaudited) September30, December31, 2012 2011 LIABILITIES AND EQUITY Current Liabilities: Accounts Payable $ 497,604 $ 522,003 Current Portion of Long-Term Debt 22,065 20,691 Accrued Income Taxes — 75,633 Other Accrued Liabilities 814,033 770,070 Total Current Liabilities 1,333,702 1,388,397 Long-Term Debt: Long-Term Debt 3,127,262 3,122,234 Capital Lease Obligations 51,747 55,189 Total Long-Term Debt 3,179,009 3,177,423 Deferred Credits and Other Liabilities: Postretirement Benefits Other Than Pensions 2,963,646 3,059,671 Pneumoconiosis Benefits 176,514 173,553 Mine Closing 443,986 406,712 Gas Well Closing 147,067 124,051 Workers' Compensation 150,129 151,034 Salary Retirement 174,844 269,069 Reclamation 52,426 39,969 Other 138,327 124,936 Total Deferred Credits and Other Liabilities 4,246,939 4,348,995 TOTAL LIABILITIES 8,759,650 8,914,815 Stockholders' Equity: Common Stock, $.01 Par Value; 500,000,000 Shares Authorized, 227,655,437 Issued and 227,620,682 Outstanding at September 30, 2,278 2,273 2012; 227,289,426 Issued and 226,056,212 Outstanding at December31, 2011 Capital in Excess of Par Value 2,275,320 2,234,775 Preferred Stock, 15,000,000 authorized, None — — issued and outstanding Retained Earnings 2,319,530 2,184,737 Accumulated Other Comprehensive Loss (799,791) (801,554) Common Stock in Treasury, at Cost—34,755 Shares at September 30, (609) (9,346) 2012 and 233,214 Shares at December31, 2011 Total CONSOL Energy Inc. Stockholders' Equity 3,796,728 3,610,885 Noncontrolling Interest 216 — TOTAL EQUITY 3,796,944 3,610,885 TOTAL LIABILITIES AND EQUITY $ 12,556,594 $ 12,525,700 CONSOL ENERGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Dollars in thousands, except per share data) Accumulated Capitalin Retained Other Common Total CONSOL Non- Common Excess Energy Inc. Total Earnings Comprehensive Stockin Stockholders' Controlling Stock ofPar Equity Equity (Deficit) Income Treasury Interest Value (Loss) Balance at $ 2,273 $ 2,234,775 $ 2,184,737 $ (801,554) $ (9,346) $ 3,610,885 $ — $ 3,610,885 December31, 2011 (Unaudited) Net Income — — 238,567 — — 238,567 (134) 238,433 (Loss) Other Comprehensive — — — 1,763 — 1,763 — 1,763 Income Comprehensive Income — — 238,567 1,763 — 240,330 (134) 240,196 (Loss) Issuance of 5 1,229 — — — 1,234 — 1,234 Common Stock Issuance of — — (18,484) — 8,737 (9,747) — (9,747) Treasury Stock Tax Cost From Stock-Based — 893 — — — 893 — 893 Compensation Amortization of Stock-Based — 38,423 — — — 38,423 — 38,423 Compensation Awards Net Change in Greenshale Energy — — — — — — 350 350 Noncontrolling Interest Dividends ($0.375 per — — (85,290) — — (85,290) — (85,290) share) Balance at September $ 2,278 $ 2,275,320 $ 2,319,530 $ (799,791) $ (609) $ 3,796,728 $ 216 $ 3,796,944 30, 2012 CONSOL ENERGY INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands) Three Months Ended Nine Months Ended September 30, September 30, 2012 2011 2012 2011 Operating Activities: Net (Loss) Income Attributable to CONSOL $ (11,368) $ 167,329 $ 238,567 $ 436,862 Energy Inc. Shareholders Adjustments to Reconcile Net (Loss) Income to Net Cash Provided By Operating Activities: Depreciation, Depletion and 153,877 159,750 463,048 466,612 Amortization Abandonment of Long-Lived — 338 — 115,817 Assets Stock-Based Compensation 11,488 11,508 38,423 37,083 (Gain) Loss on Sale of (276) 15,132 (190,257) 9,993 Assets Loss on Extinguishment of — — — 16,090 Debt Amortization of Mineral 187 571 3,818 4,149 Leases Deferred Income Taxes (35,850) (7,472) (5,225) 120 Equity in Earnings of (7,573) (8,677) (22,676) (19,989) Affiliates Changes in Operating Assets: Accounts and Notes (26,675) 885 13,359 (50,212) Receivable Inventories 38,522 17,972 (8,204) 16,264 Prepaid Expenses (21,071) (24,290) (1,362) (611) Changes in Other Assets (19,565) 1,139 (8,961) 16,446 Changes in Operating Liabilities: Accounts Payable 46,484 77,136 5,218 98,320 Other Operating Liabilities 54,563 43,198 (11,130) 66,589 Changes in Other (21,987) (175) 1,469 29,432 Liabilities Other 1,458 2,577 14,076 9,439 Net Cash Provided by Operating 162,214 456,921 530,163 1,252,404 Activities Investing Activities: Capital Expenditures (437,622) (412,022) (1,152,021) (997,463) Proceeds from Sales of 331,713 687,811 583,942 695,291 Assets Distributions From, net of (Investments In), 3,138 66,990 (18,701) 70,860 Equity Affiliates Net Cash (Used in) Provided (102,771) 342,779 (586,780) (231,312) by Investing Activities Financing Activities: Payments on Short-Term — (260,750) — (284,000) Borrowings Payments on Miscellaneous (1,903) (2,215) (6,565) (9,320) Borrowings Payments on Securitization — (70,000) — (200,000) Facility Payments on Long Term Notes, including — — — (265,785) Redemption Premium Proceeds from Issuance of — — — 250,000 Long-Term Notes Tax Benefit from 970 853 2,578 5,034 Stock-Based Compensation Dividends Paid (28,457) (22,679) (85,290) (67,972) Issuance of Common Stock 777 — 1,234 — Issuance of Treasury Stock — 1,207 109 6,219 Debt Issuance and Financing (79) (112) (227) (15,539) Fees Net Cash Used in Financing (28,692) (353,696) (88,161) (581,363) Activities Net Increase (Decrease) in 30,751 446,004 (144,778) 439,729 Cash and Cash Equivalents Cash and Cash Equivalents 200,207 26,519 375,736 32,794 at Beginning of Period Cash and Cash Equivalents $ 230,958 $ 472,523 $ 230,958 $ 472,523 at End of Period SOURCE CONSOL Energy Inc. Website: http://www.consolenergy.com Contact: Investor: Dan Zajdel, +1-724-485-4169, or Tyler Lewis, +1-724-485-3157; or Media: Lynn Seay, +1-724-485-4065
CONSOL Energy Reports Net Loss of $11 million, or ($0.05) per Diluted Share
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