Alliance Resource Partners, L.P. Increases Quarterly Distribution by 2.1% to $1.085 Per Unit: Posts Record Coal Sales and

  Alliance Resource Partners, L.P. Increases Quarterly Distribution by 2.1% to
  $1.085 Per Unit: Posts Record Coal Sales and Production Volumes and Reports
  Quarterly Financial Results

Business Wire

TULSA, Okla. -- October 26, 2012

Alliance Resource Partners, L.P. (NASDAQ: ARLP) today reported financial
results for the quarter ended September 30, 2012 (the "2012 Quarter"). Net
income in the 2012 Quarter fell to $60.5 million, or $0.89 per basic and
diluted limited partner unit, compared to $104.1 million, or $2.16 per basic
and diluted limited partner unit, for the quarter ended September 30, 2011
(the "2011 Quarter"). The decrease in the 2012 Quarter primarily reflects
approximately $24.1 million of losses and charges related to the previously
announced idling of the Pontiki mine, including a $19.0 million non-cash asset
impairment, and approximately $17.8 million due to reduced coal sales into the
metallurgical export markets. Adjusted EBITDA, which excludes the non-cash
impairment of the Pontiki mine, decreased 4.0% to $146.6 million compared to
the 2011 Quarter. (For definitions of EBITDA and Adjusted EBITDA and related
reconciliations to comparable GAAP financial measures, please see the end of
this release).

ARLP also announced that the Board of Directors of its managing general
partner increased the cash distribution to unitholders for the 2012 Quarter to
$1.085 per unit (an annualized rate of $4.34 per unit), payable on November
14, 2012 to all unitholders of record as of the close of trading on November
7, 2012. The announced distribution represents a 13.6% increase over the cash
distribution of $0.955 per unit for the 2011 Quarter and a 2.1% increase over
the cash distribution of $1.0625 per unit for the second quarter of 2012 (the
“Sequential Quarter”).

"ARLP posted record coal sales and production volumes for the 2012 Quarter,
however EBITDA and net income were negatively impacted by the unplanned idling
of our Pontiki mine and the previously anticipated lack of export sales due to
weak demand in the global coal markets" said Joseph W. Craft III, President
and Chief Executive Officer. "As we navigate through the current environment,
we are steadily making progress in building for the future. During the 2012
Quarter, our development projects at Gibson South and White Oak continued to
move forward in line with our expectations. Performance of our new Tunnel
Ridge longwall continued to improve as its production in the 2012 Quarter
reached 764,000 tons, which was nearly 500,000 tons better than the Sequential
Quarter. We also continued to add to our sales book during the 2012 Quarter,
securing new coal sales commitments for approximately 1.65 million tons to be
delivered through 2014, bringing our total year-to-date new commitments to
approximately 28.7 million tons for deliveries through 2018. Our visible
production growth and strong contract portfolio give us confidence that ARLP
is well positioned to manage through current market challenges - allowing us
to provide our unitholders with an attractive distribution increase for the
eighteenth consecutive quarter."

Consolidated Financial Results

Three Months Ended September 30, 2012 Compared to Three Months Ended September
30, 2011

As mentioned above, results for the 2012 Quarter were impacted by an asset
impairment charge at our Pontiki mining complex, which was idled on August 29,
2012 following a closure order by the Mine Safety and Health Administration
with respect to the Pontiki coal preparation plant and associated surface
facilities. Sufficient progress has been made in our efforts to improve the
near-term cost structure at Pontiki to justify the capital investment and
expense to complete the first phase of repairs necessary to allow the complex
to resume operation. Repairs at Pontiki are expected to begin shortly and
should be completed by the end of the year. By resuming operations at Pontiki,
ARLP expects to recoup the required investment for these initial repairs and
preserve potential future option value for the mining complex. Nevertheless,
Pontiki continues to face significant uncertainties regarding the long-term
viability of its operations once its 2013 coal sales contracts expire. Given
these uncertainties, we determined that an impairment of Pontiki's assets was
required in the 2012 Quarter. The $19.0 million impairment charge primarily
reflects the adjustment of the mine's assets to the fair value of equipment
currently in use at Pontiki that could be used at other operations.

On the strength of record sales volumes, coal sales revenues rose to $499.0
million in the 2012 Quarter, an increase of 5.3% compared to the 2011 Quarter.
Higher sales volumes, particularly from the new Tunnel Ridge longwall and the
recently acquired Onton mine, pushed coal sales volumes to 8.9 million tons in
the 2012 Quarter, an increase of 7.0% compared to the 2011 Quarter. Increased
sales volumes more than offset reduced metallurgical coal sold into the export
markets, which drove total average coal sales prices lower in the 2012 Quarter
to $56.00 per ton sold, an $0.89 per ton decrease compared to the 2011
Quarter.

Increases at Tunnel Ridge and Onton also contributed to record coal production
of 9.0 million tons in the 2012 Quarter, an increase of 17.7% compared to the
2011 Quarter. As expected, the increase in coal production and sales tons
contributed to higher operating expenses in the 2012 Quarter, which increased
14.9% to $338.6 million.

Outside coal purchases decreased $15.4 million to $4.4 million in the 2012
Quarter compared to the 2011 Quarter, primarily as a result of reduced
purchases of brokerage coal. Depreciation, depletion and amortization
increased $19.5 million to $59.8 million in the 2012 Quarter compared to the
2011 Quarter, primarily as a result of the start-up of longwall production at
the Tunnel Ridge mine, the addition of the Onton mine and capital expenditures
related to infrastructure improvements at various other operations.

Comparative financial results for the 2012 Quarter continued to be impacted by
anticipated losses related to ARLP's investments in White Oak Resources LLC
("White Oak") and the development of its Mine No.1. Our preferred equity
investment in White Oak requires ARLP to record substantially all of White
Oak’s income and losses until we achieve our contractual preferred return. As
a result, net equity in loss of affiliates in the 2012 Quarter primarily
reflects the pass through of approximately $3.0 million of losses related to
White Oak’s mine development activities.

Nine Months Ended September 30, 2012 Compared to Nine Months Ended September
30, 2011

For the nine months ended September 30, 2012 (the “2012 Period”), production
increases at the River View, Warrior and Tunnel Ridge mines and the
acquisition of the Onton mine in April 2012 led to record production and sales
volumes as tons produced climbed 9.8% and tons sold increased 6.9%, compared
to the nine months ended September 30, 2011 (the “2011 Period”). Higher coal
sales volumes and increased average coal sales prices, which rose $1.04 per
ton sold, combined to drive 2012 Period revenues to a record $1.5 billion, an
increase of 8.5% compared to the 2011 Period. As discussed above, these
increases were offset by reduced metallurgical coal sales, higher operating
costs and depreciation, depletion and amortization, the Pontiki asset
impairment charge, and losses related to our investments in White Oak. As a
result, compared to the 2011 Period, net income for the 2012 Period fell 19.7%
to $238.9 million, or $4.25 per basic and diluted limited partner unit, while
Adjusted EBITDA declined 1.8% to $433.5 million.

Regional Results and Analysis

                                                       
                                          %
(in               2012        2011        Change      2012
millions,         Third       Third                   Second      % Change
except per                                Quarter
ton data)         Quarter     Quarter     /           Quarter     Sequential

                                          Quarter
                                                                             
Illinois
Basin
Tons sold         6.919       6.631       4.3%        6.977       (0.8)%
Coal sales
price per         $52.20      $50.83      2.7%        $53.22      (1.9)%
ton (1)
Segment
Adjusted
EBITDA            $32.04      $31.67      1.2%        $32.81      (2.3)%
Expense per
ton (2)
Segment
Adjusted          $140.3      $127.2      10.3%       $142.7      (1.7)%
EBITDA (2)
                                                                             
Central
Appalachia
Tons sold         0.523       0.616       (15.1)%     0.493       6.1%
Coal sales
price per         $79.96      $79.99      -           $80.73      (1.0)%
ton (1)
Segment
Adjusted
EBITDA            $68.04      $59.76      13.9%       $62.10      9.6%
Expense per
ton (2)
Segment
Adjusted          $6.2        $12.5       (50.4)%     $9.2        (32.6)%
EBITDA (2)
                                                                             
Northern
Appalachia
Tons sold         1.467       0.820       78.9%       1.063       38.0%
Coal sales
price per         $65.43      $89.89      (27.2)%     $85.35      (23.3)%
ton (1)
Segment
Adjusted
EBITDA            $55.73      $62.07      (10.2)%     $71.92      (22.5)%
Expense per
ton (2)
Segment
Adjusted          $15.8       $23.7       (33.3)%     $21.2       (25.5)%
EBITDA (2)
                                                                             
Total (3)
Tons sold         8.910       8.326       7.0%        8.661       2.9%
Coal sales
price per         $56.00      $56.89      (1.6)%      $59.17      (5.4)%
ton (1)
Segment
Adjusted
EBITDA            $38.48      $37.75      1.9%        $40.23      (4.3)%
Expense per
ton (2)
Segment
Adjusted          $160.2      $166.0      (3.5)%      $171.6      (6.6)%
EBITDA (2)
                                                                             
(1) Sales price per ton is defined as total coal sales divided by total tons
sold.
(2) For definitions of Segment Adjusted EBITDA expense per ton and Segment
Adjusted EBITDA and related reconciliations to comparable GAAP financial
measures, please see the end of this release.
(3) Total includes White Oak, other, corporate and eliminations.
                                                                             

Reflecting higher Illinois Basin and Northern Appalachia sales volumes, ARLP
sold a record 8.9 million tons of coal in the 2012 Quarter, an increase of
7.0% over the 2011 Quarter. Coal sales volumes in the Illinois Basin increased
from the 2011 Quarter primarily as a result of strong sales and production
performance from the Warrior and Gibson North mines and the addition of the
Onton mine. In Central Appalachia, lower coal sales volumes compared to the
2011 Quarter reflect the idling of the Pontiki mining complex in August 2012
due to regulatory actions. Compared to the Sequential Quarter, improved coal
recoveries at both Central Appalachia mines and increased unit shifts at MC
Mining contributed to higher coal sales volumes. Coal sales volumes in
Northern Appalachia increased from the 2011 and Sequential Quarters reflecting
the start-up of longwall production at the Tunnel Ridge mine in May 2012.
Total coal inventory increased by approximately 155,000 tons during the 2012
Quarter to approximately one million tons. The increase primarily reflects
higher production and the timing of shipments from our River View mine as
barge traffic was impacted by adverse weather-related conditions during the
2012 Quarter. Shipment schedules are returning to normal and ARLP anticipates
coal inventories will trend lower to approximately 350,000 tons by the end of
the year.

Coal sales prices realized by ARLP in the 2012 Quarter were lower compared to
both the 2011 and Sequential Quarters, primarily due to reduced metallurgical
export sales from our Mettiki complex in Northern Appalachia.

Total Segment Adjusted EBITDA Expense per ton in the 2012 Quarter increased
1.9% compared to the 2011 Quarter, primarily as a result of reduced sales and
production due to the idling of Pontiki discussed above and higher coal
inventory costs. Partially offsetting these increases, Segment Adjusted EBITDA
Expense per ton benefited from increased production at Tunnel Ridge, reduced
roof control expenses per ton, lower outside coal purchases and favorable
workers’ compensation reserve adjustments during the 2012 Quarter compared to
both the 2011 and Sequential Quarters. In the Illinois Basin, Segment Adjusted
EBITDA Expense per ton increased in the 2012 Quarter compared to the 2011
Quarter, primarily due to increased costs per ton due to adverse geological
conditions at the Hopkins County mine and at the Dotiki mine related to its
transition into the West Kentucky No. 13 coal seam and the addition of the
Onton No. 9 mine. Sequentially, Segment Adjusted EBITDA Expense per ton
improved in the Illinois Basin primarily due to increased recoveries at
various operations, particularly our River View, Gibson and Pattiki mines, and
improved operating performance at our Onton mine. In Central Appalachia, the
idling of the Pontiki mining complex drove Segment Adjusted EBITDA Expense per
ton higher in the 2012 Quarter compared to both the 2011 and Sequential
Quarters. Segment Adjusted EBITDA Expense per ton improved in Northern
Appalachia during the 2012 Quarter, compared to both the 2011 and Sequential
Quarters, as the ramp of longwall production reduced costs at Tunnel Ridge and
at our Mettiki mining complex costs were lower due to changes in sales mix.
(For a definition of Segment Adjusted EBITDA and Segment Adjusted EBITDA
Expense per ton and related reconciliations to comparable GAAP financial
measures, please see the end of this release).

Outlook

Commenting on ARLP’s outlook Mr. Craft said, "Assuming normal weather patterns
and continued strength in natural gas prices, we expect U.S. steam coal demand
will grow in 2013 - removing the current inventory overhang and setting the
stage for higher spot coal prices in the second half of 2013. The exact timing
and magnitude of these market improvements will be affected by the strength of
the economy, both global and domestic. We expect ARLP's coal production and
sales volumes in 2013 to increase 11.0% to 13.0% over 2012 levels. With over
95.0% of these estimated volumes priced and committed, ARLP is on track to
again deliver solid cash flow growth in 2013 and build on our record of
distribution increases to our unitholders."

Reflecting the impact of idling Pontiki in the 2012 Quarter and the estimated
cost of returning the mine to production by year end, ARLP is revising its
full-year 2012 guidance. ARLP is currently anticipating 2012 production
volumes in a range of 34.4 to 34.9 million tons and sales volumes of 34.8 to
35.2 million tons. ARLP has secured sales commitments for essentially all of
its 2012 coal sales volumes and for approximately 37.1 million tons, 29.8
million tons and 22.8 million tons in 2013, 2014 and 2015, respectively, of
which approximately 2.9 million tons in both 2014 and 2015 remain open to
market pricing.

For 2012, ARLP is now anticipating full-year revenues, excluding
transportation revenues, in a range of $1.95 to $2.05 billion, Adjusted EBITDA
of $565.0 to $580.0 million and net income of $300.0 to $315.0 million.
Consolidated estimates for 2012 continue to reflect the pass through of
development expenses related to ARLP’s White Oak investments, which are now
estimated in a range of $12.0 to $16.0 million for both EBITDA and net income.
(For a definition of EBITDA Adjusted EBTIDA and related reconciliations to
comparable GAAP financial measures, please see the end of this release.)

ARLP continues to anticipate total 2012 capital expenditures in a range of
$565.0 to $610.0 million, including approximately $85.0 to $95.0 million for
reserve acquisitions and construction of surface facilities related to the
White Oak mine development project. In addition, ARLP now expects to fund
approximately $75.0 to $85.0 million of its preferred equity investment
commitment to White Oak during 2012.

A conference call regarding ARLP’s 2012 Quarter financial results is scheduled
for today at 10:00 a.m. Eastern. To participate in the conference call, dial
(800) 299-9086 and provide pass code 23801657. International callers should
dial (617) 786-2903 and provide the same pass code. Investors may also listen
to the call via the "investor information" section of ARLP’s website at
http://www.arlp.com.

An audio replay of the conference call will be available for approximately one
week. To access the audio replay, dial (888) 286-8010 and provide pass code
72201009. International callers should dial (617) 801-6888 and provide the
same pass code.

This announcement is intended to be a qualified notice under Treasury
Regulation Section 1.1446-4(b), with 100% of the partnership’s distributions
to foreign investors attributable to income that is effectively connected with
a United States trade or business. Accordingly, ARLP’s distributions to
foreign investors are subject to federal income tax withholding at the highest
applicable tax rate.

About Alliance Resource Partners, L.P.

ARLP is a diversified producer and marketer of coal to major United States
utilities and industrial users. ARLP, the nation's first publicly traded
master limited partnership involved in the production and marketing of coal,
is currently the third largest coal producer in the eastern United States with
mining operations in the Illinois Basin, Northern Appalachian and Central
Appalachian coal producing regions. ARLP operates eleven mining complexes in
Illinois, Indiana, Kentucky, Maryland and West Virginia. ARLP is also
constructing a new mine in southern Indiana and is purchasing and funding
development of reserves, constructing surface facilities and making equity
investments in a new mining complex in southern Illinois. In addition, ARLP
operates a coal loading terminal on the Ohio River at Mount Vernon, Indiana.

News, unit prices and additional information about ARLP, including filings
with the Securities and Exchange Commission, are available at
http://www.arlp.com. For more information, contact the investor relations
department of ARLP at (918) 295-7674 or via e-mail at
investorrelations@arlp.com.

The statements and projections used throughout this release are based on
current expectations. These statements and projections are forward-looking,
and actual results may differ materially. These projections do not include the
potential impact of any mergers, acquisitions or other business combinations
that may occur after the date of this release. At the end of this release, we
have included more information regarding business risks that could affect our
results.

FORWARD-LOOKING STATEMENTS: With the exception of historical matters, any
matters discussed in this press release are forward-looking statements that
involve risks and uncertainties that could cause actual results to differ
materially from projected results. These risks, uncertainties and
contingencies include, but are not limited to, the following: changes in
competition in coal markets and our ability to respond to such changes;
changes in coal prices, which could affect our operating results and cash
flows; risks associated with the expansion of our operations and properties;
the impact of health care legislation; deregulation of the electric utility
industry or the effects of any adverse change in the coal industry, electric
utility industry, or general economic conditions; dependence on significant
customer contracts, including renewing customer contracts upon expiration of
existing contracts; changing global economic conditions or in industries in
which our customers operate; liquidity constraints, including those resulting
from any future unavailability of financing; customer bankruptcies,
cancellations or breaches to existing contracts, or other failures to perform;
customer delays, failure to take coal under contracts or defaults in making
payments; adjustments made in price, volume or terms to existing coal supply
agreements; fluctuations in coal demand, prices and availability due to labor
and transportation costs and disruptions, equipment availability, governmental
regulations, including those related to carbon dioxide emissions, and other
factors; legislation, regulatory and court decisions and interpretations
thereof, including issues related to air and water quality and miner health
and safety; our productivity levels and margins earned on our coal sales;
unexpected changes in raw material costs; unexpected changes in the
availability of skilled labor; our ability to maintain satisfactory relations
with our employees; any unanticipated increases in labor costs, adverse
changes in work rules, or unexpected cash payments or projections associated
with post-mine reclamation and workers′ compensation claims; any unanticipated
increases in transportation costs and risk of transportation delays or
interruptions; greater than expected environmental regulation, costs and
liabilities; a variety of operational, geologic, permitting, labor and
weather-related factors; risks associated with major mine-related accidents,
such as mine fires, or interruptions; results of litigation, including claims
not yet asserted; difficulty maintaining our surety bonds for mine reclamation
as well as workers′ compensation and black lung benefits; difficulty in making
accurate assumptions and projections regarding pension, black lung benefits
and other post-retirement benefit liabilities; coal market's share of
electricity generation, including as a result of environmental concerns
related to coal mining and combustion and the cost and perceived benefits of
alternative sources of energy, such as natural gas, nuclear energy and
renewable fuels; uncertainties in estimating and replacing our coal reserves;
a loss or reduction of benefits from certain tax credits; difficulty obtaining
commercial property insurance, and risks associated with our participation
(excluding any applicable deductible) in the commercial insurance property
program; and difficulty in making accurate assumptions and projections
regarding future revenues and costs associated with equity investments in
companies we do not control.

Additional information concerning these and other factors can be found in
ARLP’s public periodic filings with the Securities and Exchange Commission
("SEC"), including ARLP’s Annual Report on Form 10-K for the year ended
December 31, 2011, filed on February 28, 2012 with the SEC. Except as required
by applicable securities laws, ARLP does not intend to update its
forward-looking statements.

                                                 
ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES



CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OPERATING DATA

(In thousands, except unit and per unit data)

(Unaudited)
                                                                                     
                   Three Months Ended                Nine Months Ended

                   September 30,                     September 30,
                   2012            2011             2012            2011
                                                                                     
Tons Sold            8,910            8,326            25,383           23,754
Tons Produced        9,000            7,644            25,697           23,398
                                                                                     
SALES AND
OPERATING
REVENUES:
Coal sales         $ 499,003        $ 473,683        $ 1,441,107      $ 1,323,851
Transportation       5,625            7,446            17,651           25,452
revenues
Other sales
and operating       6,813          6,618          26,133         19,648     
revenues
Total revenues      511,441        487,747        1,484,891      1,368,951  
                                                                                     
EXPENSES:
Operating
expenses
(excluding           338,644          294,771          946,806          835,006
depreciation,
depletion and
amortization)
Transportation       5,625            7,446            17,651           25,452
expenses
Outside coal         4,424            19,864           34,759           29,495
purchases
General and          13,598           13,276           43,939           38,698
administrative
Depreciation,
depletion and        59,781           40,275           154,923          117,237
amortization
Asset
impairment          19,031         -              19,031         -          
charge
Total
operating           441,103        375,632        1,217,109      1,045,888  
expenses
                                                                                     
INCOME FROM          70,338           112,115          267,782          323,063
OPERATIONS
                                                                                     
Interest             (7,446     )     (8,782     )     (21,626    )     (27,248    )
expense
Interest             94               83               238              275
income
Equity in loss
of affiliates,       (2,832     )     -                (11,040    )     -
net
Other income        254            360            2,853          1,340      
INCOME BEFORE        60,408           103,776          238,207          297,430
INCOME TAXES
                                                                                     
INCOME TAX          (102       )    (317       )    (726       )    (221       )
BENEFIT
                                                                                     
NET INCOME         $ 60,510        $ 104,093       $ 238,933       $ 297,651    
                                                                                     
GENERAL
PARTNERS’          $ 27,263        $ 23,474        $ 80,015        $ 66,688     
INTEREST IN
NET INCOME
                                                                                     
LIMITED
PARTNERS’          $ 33,247        $ 80,619        $ 158,918       $ 230,963    
INTEREST IN
NET INCOME
                                                                                     
BASIC AND
DILUTED NET
INCOME PER         $ 0.89          $ 2.16          $ 4.25          $ 6.19       
LIMITED
PARTNER UNIT
                                                                                     
DISTRIBUTIONS
PAID PER           $ 1.0625        $ 0.9225        $ 3.0775        $ 2.6725     
LIMITED
PARTNER UNIT
                                                                                     
WEIGHTED
AVERAGE NUMBER
OF UNITS            36,874,949     36,775,741     36,859,018     36,766,897 
OUTSTANDING –
BASIC AND
DILUTED

                                                          
ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES



CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except unit data)

(Unaudited)
                                                                             
ASSETS                                       September 30,     December 31,
                                             2012              2011
CURRENT ASSETS:
Cash and cash equivalents                    $ 2,061           $ 273,528
Trade receivables                              152,826           128,643
Other receivables                              1,432             3,525
Due from affiliates                            191               5,116
Inventories                                    63,923            33,837
Advance royalties                              9,038             7,560
Prepaid expenses and other assets             10,185          11,945    
Total current assets                           239,656           464,154
                                                                             
PROPERTY, PLANT AND EQUIPMENT:
Property, plant and equipment, at cost         2,278,297         1,974,520
Less accumulated depreciation, depletion      (784,123  )      (793,200  )
and amortization
Total property, plant and equipment, net       1,494,174         1,181,320
                                                                             
OTHER ASSETS:
Advance royalties                              26,972            27,916
Equity investments in affiliates               74,329            40,118
Other long-term assets                        31,138          18,010    
Total other assets                            132,439         86,044    
TOTAL ASSETS                                 $ 1,866,269      $ 1,731,518 
                                                                             
LIABILITIES AND PARTNERS' CAPITAL
                                                                             
CURRENT LIABILITIES:
Accounts payable                             $ 113,316         $ 96,869
Due to affiliates                              395               494
Accrued taxes other than income taxes          19,126            15,873
Accrued payroll and related expenses           42,233            35,876
Accrued interest                               6,320             2,195
Workers’ compensation and pneumoconiosis       9,488             9,511
benefits
Current capital lease obligations              1,019             676
Other current liabilities                      22,900            15,326
Current maturities, long-term debt            18,000          18,000    
Total current liabilities                      232,797           194,820
                                                                             
LONG-TERM LIABILITIES:
Long-term debt, excluding current              693,000           686,000
maturities
Pneumoconiosis benefits                        60,987            54,775
Accrued pension benefit                        24,273            27,538
Workers’ compensation                          74,862            64,520
Asset retirement obligations                   76,695            70,836
Long-term capital lease obligations            18,865            2,497
Other liabilities                             8,536           6,774     
Total long-term liabilities                   957,218         912,940   
Total liabilities                             1,190,015       1,107,760 
                                                                             
COMMITMENTS AND CONTINGENCIES
                                                                             
PARTNERS' CAPITAL:
Alliance Resource Partners, L.P.
(“ARLP”) Partners’ Capital:
Limited Partners - Common Unitholders
36,874,949 and 36,775,741 units                989,293           943,325
outstanding, respectively
General Partners' deficit                      (274,534  )       (279,107  )
Accumulated other comprehensive loss          (38,505   )      (40,460   )
Total Partners' Capital                       676,254         623,758   
TOTAL LIABILITIES AND PARTNERS' CAPITAL      $ 1,866,269      $ 1,731,518 

                                              
ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES



CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)
                                                 
                                                 Nine Months Ended

                                                 September 30,
                                                 2012           2011
                                                                  
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES      $ 431,628       $ 432,336  
                                                                  
CASH FLOWS FROM INVESTING ACTIVITIES:
Property, plant and equipment:
Capital expenditures                               (332,353 )       (216,308 )
Changes in accounts payable and accrued            (4,024   )       511
liabilities
Proceeds from sale of property, plant and          114              465
equipment
Purchase of equity investments in affiliate        (43,100  )       (35,700  )
Payment for acquisition of business                (100,000 )       -
Payments to affiliate for development of           (34,601  )       (33,841  )
coal reserves
Advances/loans to affiliate                        (2,229   )       -
Payments from affiliate                            4,229            -
Other                                             546            810      
Net cash used in investing activities             (511,418 )      (284,063 )
                                                                  
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under term loan                         250,000          -
Borrowings under revolving credit facility         150,000          -
Repayments under revolving credit facility         (75,000  )       -
Payment on term loan                               (300,000 )       -
Payment on long-term debt                          (18,000  )       (18,000  )
Payments on capital lease obligations              (673     )       (595     )
Payment of debt issuance costs                     (4,272   )       -
Net settlement of employee withholding taxes       (3,734   )       (2,324   )
on vesting of Long-Term Incentive Plan
Cash contributions by General Partners             150              87
Distributions paid to Partners                    (190,148 )      (159,826 )
Net cash used in financing activities             (191,677 )      (180,658 )
                                                                  
NET CHANGE IN CASH AND CASH EQUIVALENTS            (271,467 )       (32,385  )
                                                                  
CASH AND CASH EQUIVALENTS AT BEGINNING OF          273,528          339,562
PERIOD
                                                                 
CASH AND CASH EQUIVALENTS AT END OF PERIOD       $ 2,061         $ 307,177  
                                                                             

Reconciliation of GAAP "Net Income" to non-GAAP "EBITDA" and “Adjusted EBITDA”
and non-GAAP "Distributable Cash Flow" (in thousands).

EBITDA is defined as net income before net interest expense, income taxes and
depreciation, depletion and amortization and Adjusted EBITDA is EBITDA
modified to reflect significant non-recurring items that may not reflect the
trend of future results. EBITDA is used as a supplemental financial measure by
our management and by external users of our financial statements such as
investors, commercial banks, research analysts and others, to assess:

  *the financial performance of our assets without regard to financing
    methods, capital structure or historical cost basis;
  *the ability of our assets to generate cash sufficient to pay interest
    costs and support our indebtedness;
  *our operating performance and return on investment as compared to those of
    other companies in the coal energy sector, without regard to financing or
    capital structures; and
  *the viability of acquisitions and capital expenditure projects and the
    overall rates of return on alternative investment opportunities.

We believe Adjusted EBITDA is a useful measure for investors because it
further demonstrates the performance of our assets without regard to
non-recurring charges.

Distributable cash flow (“DCF”) is defined as Adjusted EBITDA excluding
interest expense (before capitalized interest), interest income, income taxes
and estimated maintenance capital expenditures. DCF is used as a supplemental
financial measure by our management and by external users of our financial
statements, such as investors, commercial banks, research analysts and others,
to assess:

  *the cash flows generated by our assets (prior to the establishment of any
    retained cash reserves by the general partner) to fund the cash
    distributions we expect to pay to unitholders;
  *our success in providing a cash return on investment and whether or not
    the Partnership is generating cash flow at a level that can sustain or
    support an increase in its quarterly distribution rates;
  *the yield of our units, which is a quantitative standard used through the
    investment community with respect to publicly-traded partnerships as the
    value of a unit is generally determined by a unit’s yield (which in turn
    is based on the amount of cash distributions the entity pays to a
    unitholder).

EBITDA, Adjusted EBITDA and DCF should not be considered as alternatives to
net income, income from operations, cash flows from operating activities or
any other measure of financial performance presented in accordance with
generally accepted accounting principles. EBITDA, Adjusted EBITDA and DCF are
not intended to represent cash flow and do not represent the measure of cash
available for distribution. Our method of computing EBITDA, Adjusted EBITDA
and DCF may not be the same method used to compute similar measures reported
by other companies, and EBITDA and DCF may be computed differently by us in
different contexts (i.e. public reporting versus computation under financing
agreements). We have not previously modified EBITDA for any non-recurring
charges to calculate Adjusted EBITDA and, as a result, EBITDA and Adjusted
EBITDA are equivalent in all historical periods.

                                                                                    
                                                                            Three
                  Three Months Ended          Nine Months Ended             Months        Year Ended
                                                                            Ended
                  September 30,               September 30,                               December 31,
                                                                            June 30,
                                                                                          2012E
                  2012         2011          2012          2011           2012
                                                                                          Midpoint
                                                                                                       
Net income        $ 60,510      $ 104,093     $ 238,933      $ 297,651      $ 95,455      $ 307,500
Depreciation,
depletion and       59,781        40,275        154,923        117,237        52,109        217,500
amortization
Interest
expense,            9,053         8,869         27,821         27,455         9,995         37,000
gross
Capitalized         (1,701  )     (170    )     (6,433   )     (482     )     (1,778  )     (7,500   )
interest
Income tax         (102    )    (317    )    (726     )    (221     )    (257    )    (1,000   )
benefit
EBITDA              127,541       152,750       414,518        441,640        155,524       553,500
Asset
impairment         19,031      -           19,031       -            -           19,000   
charge
Adjusted            146,572       152,750       433,549        441,640        155,524       572,500
EBITDA
Interest
expense,            (9,053  )     (8,869  )     (27,821  )     (27,455  )     (9,995  )     (37,000  )
gross
Income tax          102           317           726            221            257           1,000
benefit
Estimated
maintenance
capital            (49,500 )    (35,927 )    (141,334 )    (109,971 )    (45,018 )    (190,500 )
expenditures
^(1)
Distributable     $ 88,121     $ 108,271    $ 265,120     $ 304,435     $ 100,768    $ 346,000  
Cash Flow
                                                                                                       
(1) Our maintenance capital expenditures, as defined under the terms of our partnership agreement, are
those capital expenditures required to maintain, over the long-term, the operating capacity of our
capital assets.We estimate maintenance capital expenditures on an annual basis based upon a five-year
planning horizon.For the current five-year planning horizon, average annual estimated maintenance
capital expenditures are assumed to be $5.50 per produced ton compared to the estimated $4.70 per
produced ton in 2011.Our actual maintenance capital expenditures vary depending on various factors,
including maintenance schedules and timing of capital projects, among others.We annually disclose our
actual maintenance capital expenditures in our Form 10-K filed with the Securities and Exchange
Commission.


Reconciliation of GAAP "Operating Expenses" to non-GAAP "Segment Adjusted
EBITDA Expense per ton" and Reconciliation of non-GAAP "EBITDA" to "Segment
Adjusted EBITDA" (in thousands, except per ton data).

Segment Adjusted EBITDA Expense per ton includes operating expenses, outside
coal purchases and other income divided by tons sold. Transportation expenses
are excluded as these expenses are passed through to our customers and,
consequently, we do not realize any margin on transportation revenues. Segment
Adjusted EBITDA Expense is used as a supplemental financial measure by our
management to assess the operating performance of our segments. Segment
Adjusted EBITDA Expense is a key component of EBITDA in addition to coal sales
and other sales and operating revenues. The exclusion of corporate general and
administrative expenses from Segment Adjusted EBITDA Expense allows management
to focus solely on the evaluation of segment operating performance as it
primarily relates to our operating expenses. Outside coal purchases are
included in Segment Adjusted EBITDA Expense because tons sold and coal sales
include sales from outside coal purchases.

                                                       
                              Three Months Ended            Three Months Ended

                              September 30,                 June 30,
                              2012         2011            2012
                                                            
Operating expense             $ 338,644     $ 294,771       $    334,647
Outside coal purchases          4,424         19,864             16,154
Other (income) loss            (254    )    (360    )         (2,384    )
Segment Adjusted EBITDA       $ 342,814     $ 314,275       $    348,417
Expense
Divided by tons sold           8,910       8,326            8,661     
Segment Adjusted EBITDA       $ 38.48      $ 37.75        $    40.23     
Expense per ton
                                                            

Segment Adjusted EBITDA is defined as net income before net interest expense,
income taxes, depreciation, depletion and amortization, general and
administrative expenses and asset impairment charge.

                                                     
                                Three Months Ended        Three Months Ended

                                September 30,             June 30,
                                2012       2011          2012
                                                                             
Adjusted EBITDA (See
reconciliation to GAAP          $ 146,572   $ 152,750     $      155,524
above)
General and administrative       13,598     13,276            16,052
Segment Adjusted EBITDA         $ 160,170   $ 166,026     $      171,576
                                                                             

Contact:

Alliance Resource Partners, L.P.
Brian L. Cantrell, 918-295-7673
 
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