Basis of Presentation

6 Months Ended

Jun. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

BASIS OF PRESENTATION:

The accompanying Unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for future periods.

The balance sheet at December 31, 2013 has been derived from the Audited Consolidated Financial Statements at that date but does not include all the notes required by generally accepted accounting principles for complete financial statements. For further information, refer to the Consolidated Financial Statements and related notes for the year ended December 31, 2013 included in CONSOL Energy Inc.'s Form 10-K.

Certain amounts in prior periods have been reclassified to conform with the report classifications of the year ended December 31, 2013, with no effect on previously reported net income or stockholders' equity.

Basic earnings per share are computed by dividing net income (loss) attributable to shareholders by the weighted average shares outstanding during the reporting period. Dilutive earnings per share are computed similarly to basic earnings per share except that the weighted average shares outstanding are increased to include additional shares from stock options, performance stock options, CONSOL stock units, and restricted and performance share units, if dilutive. The number of additional shares is calculated by assuming that outstanding stock options and performance share options were exercised, that outstanding restricted stock units, performance share units, and CONSOL stock units were released, and that the proceeds from such activities were used to acquire shares of common stock at the average market price during the reporting period. CONSOL Energy Inc. (CONSOL Energy or the Company) includes the impact of pro forma deferred tax assets in determining potential windfalls and shortfalls for purposes of calculating assumed proceeds under the treasury stock method. The table below sets forth the share-based awards that have been excluded from the computation of the diluted earnings per share because their effect would be anti-dilutive:

	Three Months Ended June 30,		Six Months Ended June 30,
	2014	2013	2014	2013
Anti-Dilutive Options	4,123,949	4,845,029	359,488	4,845,029
Anti-Dilutive Restricted Stock Units	1,265,237	1,383,908	—	1,383,908
Anti-Dilutive Performance Share Units	523,357	83,356	—	83,356
Anti-Dilutive Performance Share Options	802,804	602,101	—	602,101
	6,715,347	6,914,394	359,488	6,914,394

The table below sets forth the share-based awards that have been exercised or released:

	Three Months Ended June 30,		Six Months Ended June 30,
	2014	2013	2014	2013
Options	382,773	160,119	648,112	245,113
Restricted Stock Units	56,403	89,632	390,802	568,141
Performance Share Units	—	—	378,971	159,228
	439,176	249,751	1,417,885	972,482

The weighted average exercise price per share of the options exercised during the three months ended June 30, 2014 and 2013 was $21.57 and $9.90, respectively. The weighted average exercise price per share of the options exercised during the six months ended June 30, 2014 and 2013 was $20.41 and $10.16, respectively.

The computations for basic and dilutive earnings per share are as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
(Loss) Income from Continuing Operations	$	(24,935	)	$	8,562		$	96,756		$	4,838
(Loss) Income from Discontinuing Operations	—			(21,375		)	(5,687		)	(19,472		)
Less: Net Loss Attributable to Noncontrolling Interest	—			(287		)	—			(544		)
Net (Loss) Income Attributable to CONSOL Energy Inc. Shareholders	$	(24,935	)	$	(12,526	)	$	91,069		$	(14,090	)
Weighted average shares of common stock outstanding:
Basic	230,061,395			228,721,980			229,795,193			228,520,886
Effect of stock-based compensation awards	—			—			1,595,988			—
Dilutive	230,061,395			228,721,980			231,391,181			228,520,886
Earnings per share:
Basic (Continuing Operations)	$	(0.11	)	$	0.04		$	0.42		$	0.02
Basic (Discontinuing Operations)	—			(0.09		)	(0.02		)	(0.08		)
Total Basic	$	(0.11	)	$	(0.05	)	$	0.40		$	(0.06	)
Dilutive (Continuing Operations)	$	(0.11	)	$	0.04		$	0.42		$	0.02
Dilutive (Discontinuing Operations)	—			(0.09		)	(0.03		)	(0.08		)
Total Dilutive	$	(0.11	)	$	(0.05	)	$	0.39		$	(0.06	)

Changes in Accumulated Other Comprehensive Income / (Loss) by component, net of tax, were as follows:

	Gains and Losses on Cash Flow Hedges			Postretirement Benefits			Total
Balance at December 31, 2013	$	42,493		$	(367,610	)	$	(325,117	)
Other comprehensive income before reclassifications	(59,183		)	(22,133		)	(81,316		)
Amounts reclassified from accumulated other comprehensive income	23,264			23,454			46,718
Current period other comprehensive income	(35,919		)	1,321			(34,598		)
Balance at June 30, 2014	$	6,574		$	(366,289	)	$	(359,715	)

The following table shows the reclassification of adjustments out of Accumulated Other Comprehensive Loss:

	Three Months Ended June 30,						Six Months Ended June 30,
	2014			2013			2014			2013
Derivative Instruments (Note 13)
Natural gas price swaps and options	$	13,593		$	(18,088	)	$	40,857		$	(54,767	)
Tax (expense) benefit	(6,642		)	8,560			(17,593		)	22,526
Net of tax	$	6,951		$	(9,528	)	$	23,264		$	(32,241	)
Actuarially Determined Long-Term Liability Adjustments*(Note 4 and Note 5)
Amortization of prior service costs	$	(2,542	)	$	(8,211	)	$	(5,084	)	$	(16,423	)
Recognized net actuarial loss	10,861			23,559			21,507			48,747
Settlement loss	20,707			5,087			20,707			32,202
Total	29,026			20,435			37,130			64,526
Tax expense	(10,691		)	(7,800		)	(13,676		)	(24,631		)
Net of tax	$	18,335		$	12,635		$	23,454		$	39,895