SEGMENT INFORMATION (Tables)

12 Months Ended

Dec. 31, 2012

SEGMENT INFORMATION

Schedule of Segment Reporting Information, by Segment

	Illinois Basin		Central Appalachia		Northern Appalachia		White Oak			Other and Corporate		Elimination (1)			Consolidated
	(in thousands)
Reportable segment results as of and for the year ended December 31, 2012 were as follows:
Total revenues(2)	$	1,499,976	$	157,311	$	335,099	$	—		$	58,072	$	(16,528	)	$	2,033,930
Segment Adjusted EBITDA Expense(3)		894,769		131,148		277,736		(1,347	)		53,005		(16,528	)		1,338,783
Segment Adjusted EBITDA(4)(5)		593,054		25,712		47,933		(13,987	)		5,751		—			658,463
Total assets(6)		1,042,719		87,068		537,042		226,714			66,396		(1,099	)		1,958,840
Capital expenditures(7)		219,029		33,817		109,039		85,671			11,676		—			459,232
Reportable segment results as of and for the year ended December 31, 2011 were as follows:
Total revenues(2)	$	1,313,148	$	206,323	$	274,233	$	—		$	64,667	$	(15,168	)	$	1,843,203
Segment Adjusted EBITDA Expense(3)		786,116		151,101		203,317		155			59,526		(15,168	)		1,185,047
Segment Adjusted EBITDA(4)(5)		505,113		53,729		62,395		(4,407	)		5,983		—			622,813
Total assets(6)		787,923		96,099		452,407		89,690			309,213		(855	)		1,734,477
Capital expenditures(7)		153,118		28,477		137,040		51,198			2,887		—			372,720
Reportable segment results as of and for the year ended December 31, 2010 were as follows:
Total revenues(2)	$	1,202,442	$	165,175	$	219,211	$	—		$	44,730	$	(21,815	)	$	1,609,743
Segment Adjusted EBITDA Expense(3)		717,040		128,318		163,876		—			38,743		(21,815	)		1,026,162
Segment Adjusted EBITDA(4)		460,592		36,714		46,702		—			5,989		—			549,997
Total assets		745,626		81,818		313,515		—			367,199		(4,086	)		1,504,072
Capital expenditures		149,149		10,012		128,961		—			1,752		—			289,874

(1)

The elimination column represents the elimination of intercompany transactions and is primarily comprised of sales from the Matrix Group to the ARLP Partnership's mining operations.

(2)

Revenues included in the Other and Corporate column are primarily attributable to Matrix Group revenues, Mt. Vernon transloading revenues and brokerage sales.

(3)

Segment Adjusted EBITDA Expense includes operating expenses, outside coal purchases and other income. Transportation expenses are excluded as these expenses are passed through to the ARLP Partnership's customers and consequently it does not realize any gain or loss on transportation revenues. We review Segment Adjusted EBITDA Expense per ton for cost trends.

The following is a reconciliation of consolidated Segment Adjusted EBITDA Expense to operating expenses (excluding depreciation, depletion and amortization) (in thousands):

	Year Ended December 31,
	2012			2011			2010
Segment Adjusted EBITDA Expense	$	1,338,783		$	1,185,047		$	1,026,162
Outside coal purchases		(38,607	)		(54,280	)		(17,078	)
Other income		3,115			983			851
Operating expenses (excluding depreciation, depletion and amortization)	$	1,303,291		$	1,131,750		$	1,009,935

(4)

Segment Adjusted EBITDA is defined as net income (prior to the allocation of noncontrolling interest) before income taxes, net interest expense, depreciation, depletion and amortization, general and administrative expenses and asset impairment charge. Management therefore is able to focus solely on the evaluation of segment operating profitability as it relates to the ARLP Partnership's revenues and operating expenses, which are primarily controlled by our segments. Consolidated Segment Adjusted EBITDA is reconciled to net income below (in thousands):

	Year Ended December 31,
	2012			2011			2010
Consolidated Segment Adjusted EBITDA	$	658,463		$	622,813		$	549,997
General and administrative		(62,713	)		(54,991	)		(54,215	)
Depreciation, depletion and amortization		(218,122	)		(160,335	)		(146,881	)
Asset impairment charge		(19,031	)		—			—
Interest expense, net		(28,453	)		(21,574	)		(29,858	)
Income tax (expense) benefit		1,082			430			(1,742	)
Net income	$	331,226		$	386,343		$	317,301

(5)

Includes equity in income (loss) of affiliates for the year ended December 31, 2012 and 2011 of $(15.3) million and $(4.3) million, respectively, included in the White Oak segment and $0.7 million and $0.8 million, respectively, included in the Other and Corporate segment

(6)

Total assets for the White Oak and Other and Corporate Segments include investments in affiliate of $86.8 million and $1.7 million, respectively, at December 31, 2012 and $38.5 million and $1.6 million, respectively, at December 31, 2011.

(7)

Capital expenditures shown above for the year ended December 31, 2012 and 2011 include $34.6 million and $50.8 million, respectively, for acquisition and development of coal reserves in our consolidated statements of cash flow. Capital expenditures shown above exclude the Green River acquisition in April 2012 (Note 4).

Reconciliation of Consolidated Segment Adjusted EBITDA Expense to Operating Expenses

The following is a reconciliation of consolidated Segment Adjusted EBITDA Expense to operating expenses (excluding depreciation, depletion and amortization) (in thousands):

	Year Ended December 31,
	2012			2011			2010
Segment Adjusted EBITDA Expense	$	1,338,783		$	1,185,047		$	1,026,162
Outside coal purchases		(38,607	)		(54,280	)		(17,078	)
Other income		3,115			983			851
Operating expenses (excluding depreciation, depletion and amortization)	$	1,303,291		$	1,131,750		$	1,009,935

Reconciliation of Consolidated Segment Adjusted EBITDA to Net Income

Consolidated Segment Adjusted EBITDA is reconciled to net income below (in thousands):

	Year Ended December 31,
	2012			2011			2010
Consolidated Segment Adjusted EBITDA	$	658,463		$	622,813		$	549,997
General and administrative		(62,713	)		(54,991	)		(54,215	)
Depreciation, depletion and amortization		(218,122	)		(160,335	)		(146,881	)
Asset impairment charge		(19,031	)		—			—
Interest expense, net		(28,453	)		(21,574	)		(29,858	)
Income tax (expense) benefit		1,082			430			(1,742	)
Net income	$	331,226		$	386,343		$	317,301