Reorganization Items, Net (Tables)

12 Months Ended

Dec. 31, 2019

Dec. 31, 2018

Reorganizations [Abstract]

Schedule of Reorganization Items [Table Text Block]

The Company’s application of fresh start reporting resulted in recognition of the following reorganization items for the periods presented below:

	Successor			Predecessor
	Year Ended December 31, 2018			January 1 through April 1, 2017
	(Dollars in millions)
Gain on settlement of claims	$	(12.8	)	$	(3,031.2	)
Fresh start adjustments, net	—			3,363.1
Fresh start income tax adjustments, net	—			253.9
Professional fees	—			42.5
Accounts payable settlement gains	—			(0.7		)
Interest income	—			(0.4		)
Reorganization items, net	$	(12.8	)	$	627.2

Schedule of Liabilities Subject to Compromise [Table Text Block]

The following is the calculation of the total pre-tax gain on the settlement of the liabilities subject to compromise.

	(Dollars in millions)
Liabilities subject to compromise	$	8,416.7
Less amounts issued to settle claims:
Successor Common Stock (at par)	(0.7		)
Successor Series A Convertible Preferred Stock	(1,305.4		)
Successor Additional paid-in capital	(1,774.9		)
Issuance of Successor Notes	(1,000.0		)
Issuance of Successor Term Loan	(950.0		)
Cash payments and accruals for claims and professional fees	(336.4		)
Other:
Write-off of Predecessor debt issuance costs	(18.1		)
Gain on settlement of claims	$	3,031.2

Impact of Fresh Start Adjustments on Balance Sheet [Table Text Block]

Upon implementation of the Plan on the Effective Date, the Company recorded fresh start adjustments, net, as follows:

		(Dollars in millions)
Inventories	(a)	$	70.1
Other current assets	(b)	(333.0		)
Property, plant, equipment and mine development, net	(c)	(3,461.4		)
Investments and other assets	(d)	238.0
Accounts payable and accrued expenses	(e)	(14.8		)
Deferred income taxes	(f)	177.8
Asset retirement obligations	(g)	73.9
Accrued postretirement benefit costs	(h)	6.9
Other noncurrent liabilities	(i)	(120.6		)
Total fresh start adjustments, net		$	(3,363.1	)

(a) Represents adjustment to increase the book value of coal inventories to their estimated fair value, less costs to sell the inventories.

(b) Represents adjustments comprising $228.5 million related to assets classified as held-for-sale at March 31, 2017 which were reclassified as held-for-use and considered in connection with the valuations described in (c) below,$89.5 million to write off certain existing short-term mine development costs, and $15.0 million of various prepaid assets deemed to have no future utility subsequent to the Effective Date.

(c) Represents a $3,461.4 million reduction in property, plant and equipment to estimated fair value as discussed below:

The fair value of land and coal interests, excluding the asset related to the Company’s asset retirement obligations described below, was established at $3,504.7 million utilizing a discounted cash flow (DCF) model and the market approach. The market approach was used to provide a starting value of the coal mineral reserves without consideration for economic obsolescence. The DCF model was based on assumptions market participants would use in the pricing of these assets as well as projections of revenues and expenditures that would be incurred to mine or maintain these coal reserves through the life of mine. The basis of the DCF analysis was the Company’s prepared projections which included a variety of estimates and assumptions, such as pricing and demand for coal. The Company’s pricing was based on its view of the market taking into account third-party forward pricing curves adjusted for the quality of products sold by the Company. The fair value of land and coal interests also includes $281.2 million corresponding to the asset retirement obligation discussed in item (g) below.

The fair value of buildings and improvements and machinery and equipment were set at $466.1 million and $940.5 million, respectively, utilizing both market and cost approaches. The market approach was used to estimate the value of assets where detailed information for the asset was available and an active market was identified with a sufficient number of sales of comparable property that could be independently verified through reliable sources. The cost approach was utilized where there were limitations in the secondary equipment market to derive values from. The first step in the cost approach is the estimation of the cost required to replace the asset via construction or purchasing a new asset with similar utility adjusting for depreciation due to physical deterioration, functional obsolescence due to technology changes and economic obsolescence due to external factors such as regulatory changes. Useful lives were assigned to all assets based on remaining future economic benefit of each asset.

(d) Primarily to recognize fair value of $314.9 million inherent in certain U.S. coal supply agreements as a result of favorable differences between contract terms and estimated market terms for the same coal products, partially offset by a reduction in the fair value of certain equity method investments. The intangible asset related to coal supply agreements will be amortized on a per ton shipped basis through 2025.

(e) Represents $32.6 million to account for the short-term portion of the value of certain contract-based intangibles primarily consisting of unutilized capacity of certain port and rail take-or-pay contracts, partially offset by $15.7 million related to liabilities classified as held-for-sale at March 31, 2017 which were reclassified as held-for-use and considered in connection with the valuations described in (c) above, and various other fair value adjustments. The intangible liabilities related to port and rail take-or-pay contracts will be amortized ratably over the terms of each contact, which vary in duration through 2043.

(f) Represents the tax impact of fresh start reporting.

(g) Represents the fair value adjustment related to the Company’s asset retirement obligations which was calculated using DCF models based on contemporary mine plans. The credit-adjusted, risk-free interest rates utilized to estimate the Company’s asset retirement obligations were 9.36% for its U.S. reclamation obligations and 4.36% for its Australia reclamation obligations.

(h) Represents the remeasurement of liabilities associated with the Company’s postretirement benefits obligations as of the Effective Date as the reorganization of the Company pursuant to the Plan represented a remeasurement event under ASC 715 “Compensation - Retirement Benefits.” The relevant discount rate was adjusted to 4.10% from 4.15% used in the Company’s remeasurement process for the year ended December 31, 2016.

(i)

Represents $83.6 million to account for the long-term portion of the value of contract-based intangibles related to unutilized capacity of port and rail take-or-pay contracts as described in (e) above and $58.7 million to account for the fair value inherent in certain U.S. coal supply agreements as a result of unfavorable differences between contract terms and estimated market terms for the same coal products as described in (d) above, partially offset by a remeasurement reduction of $9.2 million of the Company’s pension liabilities in accordance with ASC 715 as described in (h) above, as the relevant discount rate was adjusted to 4.10% from 4.15% used in the Company’s remeasurement process for the year ended December 31, 2016, and certain other valuation adjustments.