SEGMENT INFORMATION (Tables)

12 Months Ended

Dec. 31, 2015

	Illinois Basin		Appalachia			Other and Corporate		Elimination (1)		Consolidated
	(in thousands)

Year ended December 31, 2015

Total revenues (2)	$	1,636,217	$	596,299		$	180,622	$	(139,827)	$	2,273,311
Segment Adjusted EBITDA Expense (3)	949,271		400,681			153,720		(127,247)		1,376,425
Segment Adjusted EBITDA (4)(5)	617,148		183,908			25,767		(12,580)		814,243
Total assets (6)	1,694,044		517,972			270,891		(114,547)		2,368,360
Capital expenditures (7)	145,352		61,279			6,166		-		212,797

Year ended December 31, 2014 (recast)

Total revenues (2)	$	1,647,694	$		630,452	$	33,693	$	(11,515)	$	2,300,324
Segment Adjusted EBITDA Expense (3)	1,000,028		364,689			25,487		(8,396)		1,381,808
Segment Adjusted EBITDA (4)(5)	616,727		254,037			8,202		(3,119)		875,847
Total assets (6)	1,581,279		604,352			262,120		(158,996)		2,285,755
Capital expenditures (7)	243,167		56,840			11,462		-		311,469

Year ended December 31, 2013 (recast)

Total revenues (2)	$	1,631,283	$	493,689		$	97,910	$	(17,683)	$	2,205,199
Segment Adjusted EBITDA Expense (3)	953,798		375,923			86,864		(17,683)		1,398,902
Segment Adjusted EBITDA (4)(5)	632,175		105,123			11,916		-		749,214
Total assets (6)	1,394,592		594,466			138,696		(1,075)		2,126,679
Capital expenditures (7)	272,861		72,926			8,636		-		354,423

(1)

The elimination column represents the elimination of intercompany transactions and is primarily comprised of sales from the Matrix Group and MAC to the ARLP Partnership’s mining operations, coal sales and purchases between operations within different segments, sales of receivables to AROP Funding and insurance premiums paid to Wildcat Insurance (2015 and 2014 only).

(2)

Revenues included in Other and Corporate column are primarily attributable to the Matrix Group revenues, Mt. Vernon transloading revenues, administrative service revenues from affiliates, MAC revenues, Wildcat Insurance revenues, brokerage sales and Pontiki’s coal sales revenue (2013 only).

(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):

	Year Ended December 31,
	2015		2014		2013
	(in thousands)

Segment Adjusted EBITDA Expense	$	1,376,425	$	1,381,808	$	1,398,902
Outside coal purchases	(327)		(14)		(2,030		)
Other income	955		1,566		1,891

Operating expenses (excluding depreciation, depletion and amortization)	$	1,377,053	$	1,383,360	$	1,398,763

(4)

Segment Adjusted EBITDA is defined as net income (prior to the allocation of noncontrolling interest) before net interest expense, income taxes, depreciation, depletion and amortization, asset impairment charge, acquisition gain, net and general and administrative expenses. 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 as follows:

	Year Ended December 31,
	2015		2014		2013
	(in thousands)

Consolidated Segment Adjusted EBITDA	$	814,243	$	875,847	$	749,214
General and administrative	(69,076)		(76,699)		(65,231		)
Depreciation, depletion and amortization	(333,713)		(274,566)		(264,911		)
Asset impairment charge	(100,130)		-		-
Interest expense, net	(29,693)		(31,913)		(26,081		)
Acquisition gain, net	22,548		-		-
Income tax expense	(21)		-		(1,397		)

Net income	$	304,158	$	492,669	$	391,594

(5)

Includes equity in income (loss) of affiliates for the years ended December 31, 2015, 2014 and 2013 of $(48.5) million, $(16.6) million and $(25.3) million, respectively, for the Illinois Basin segment and $(0.5) million, $(3) thousand and $0.9 million, respectively, for Other and Corporate.

(6)

Total assets at December 31, 2015, 2014 and 2013 include investments in affiliate of $64.5 million, $12.9 million and $1.7 million, respectively, within Other and Corporate. Total assets at December 31, 2014 and 2013 include investments in affiliate of $211.7 million and $128.7 million, respectively, for the Illinois Basin segment.

(7)

Capital expenditures shown above include funding to White Oak of $4.1 million and $25.3 million, for the years ended December 31, 2014 and 2013, respectively, for the acquisition and development of coal reserves from White Oak, which is described as Payments to affiliate for acquisition and development of coal reserves in our consolidated statements of cash flow. Capital expenditures shown above exclude the Hamilton Acquisition on July 31, 2015, the Patriot acquisition on February 3, 2015, the MAC acquisition on January 1, 2015 and purchase of coal supply agreements from Patriot on December 31, 2014 (Note 3 – Acquisitions).

Reconciliation of consolidated Segment Adjusted EBITDA Expense to operating expenses (excluding depreciation, depletion and amortization)

	Year Ended December 31,
	2015		2014		2013
	(in thousands)

Segment Adjusted EBITDA Expense	$	1,376,425	$	1,381,808	$	1,398,902
Outside coal purchases	(327)		(14)		(2,030		)
Other income	955		1,566		1,891

Operating expenses (excluding depreciation, depletion and amortization)	$	1,377,053	$	1,383,360	$	1,398,763

Reconciliation of consolidated Segment Adjusted EBITDA to net income

	Year Ended December 31,
	2015		2014		2013
	(in thousands)

Consolidated Segment Adjusted EBITDA	$	814,243	$	875,847	$	749,214
General and administrative	(69,076)		(76,699)		(65,231		)
Depreciation, depletion and amortization	(333,713)		(274,566)		(264,911		)
Asset impairment charge	(100,130)		-		-
Interest expense, net	(29,693)		(31,913)		(26,081		)
Acquisition gain, net	22,548		-		-
Income tax expense	(21)		-		(1,397		)

Net income	$	304,158	$	492,669	$	391,594