Note 16 - Segment Information

3 Months Ended

Mar. 31, 2022

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

NOTE 16—SEGMENT INFORMATION:

The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management to make decisions on and assess performance of the Company’s reportable segments. CONSOL Energy presently consists of two reportable segments, the PAMC and the CONSOL Marine Terminal. The PAMC includes the Bailey Mine, the Enlow Fork Mine, the Harvey Mine and a centralized preparation plant. The PAMC segment’s principal activities include the mining, preparation and marketing of bituminous coal, sold primarily to power generators, industrial end-users and metallurgical end-users. The CONSOL Marine Terminal provides coal export terminal services through the Port of Baltimore. Selling, general and administrative costs are allocated to the Company’s segments based on a percentage of resources utilized, a percentage of total revenue and a percentage of total projected capital expenditures. CONSOL Energy’s Other segment includes revenue and expenses from various corporate and diversified business activities that are not allocated to the PAMC or the CONSOL Marine Terminal segments. The diversified business activities include the development of the Itmann Mine, the Greenfield Reserves and Resources, closed mine activities, other income, gain on asset sales related to non-core assets, and gain/loss on debt extinguishment. Additionally, interest expense and income taxes, as well as various other non-operated activities, none of which are individually significant to the Company, are also reflected in CONSOL Energy's Other segment and are not allocated to the PAMC and CONSOL Marine Terminal segments.

The Company evaluates the performance of its segments utilizing Adjusted EBITDA and various sales and production metrics. Adjusted EBITDA is not a measure of financial performance determined in accordance with GAAP, and items excluded from Adjusted EBITDA may be significant in understanding and assessing the Company's financial condition. Therefore, Adjusted EBITDA should not be considered in isolation, nor as an alternative to net income, income from operations, or cash flows from operations, or as a measure of the Company's profitability, liquidity, or performance under GAAP. The Company uses Adjusted EBITDA to measure the operating performance of its segments and to allocate resources to its segments. Investors should be aware that the Company's presentation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies.

Reportable segment results for the three months ended March 31, 2022 are:

	PAMC		CONSOL Marine Terminal		Other			Adjustments and Eliminations		Consolidated
Coal Revenue	$	472,960	$	—	$	3,408		$	—	$	476,368
Terminal Revenue		—		21,397		—			—		21,397
Freight Revenue		38,389		—		—			—		38,389
Total Revenue from Contracts with Customers	$	511,349	$	21,397	$	3,408		$	—	$	536,154
Adjusted EBITDA(a)	$	158,258	$	14,477	$	(3,505	)	$	—	$	169,230
Segment Assets	$	1,734,316	$	80,135	$	900,509		$	—	$	2,714,960
Depreciation, Depletion and Amortization	$	50,956	$	1,165	$	3,833		$	—	$	55,954
Capital Expenditures	$	12,978	$	172	$	23,493		$	—	$	36,643

(a) Refer to “Reconciliation of Segment Information to Consolidated Amounts” for the reconciliation of Adjusted EBITDA, a non-GAAP measure, to its most directly comparable GAAP measure.

Reportable segment results for the three months ended March 31, 2021 are:

	PAMC		CONSOL Marine Terminal		Other			Adjustments and Eliminations		Consolidated
Coal Revenue	$	284,465	$	—	$	1,070		$	—	$	285,535
Terminal Revenue		—		18,212		—			—		18,212
Freight Revenue		27,013		—		—			—		27,013
Total Revenue from Contracts with Customers	$	311,478	$	18,212	$	1,070		$	—	$	330,760
Adjusted EBITDA(a)	$	99,185	$	11,961	$	(4,431	)	$	—	$	106,715
Segment Assets	$	1,855,878	$	106,603	$	558,079		$	—	$	2,520,560
Depreciation, Depletion and Amortization	$	54,781	$	1,214	$	3,902		$	—	$	59,897
Capital Expenditures	$	12,579	$	60	$	1,161		$	—	$	13,800

(a) Refer to “Reconciliation of Segment Information to Consolidated Amounts” for the reconciliation of Adjusted EBITDA, a non-GAAP measure, to its most directly comparable GAAP measure.

For the three months ended March 31, 2022 and 2021, the Company's reportable segments had revenues from the following customers, each comprising over 10% of the Company's total sales:

	Three Months Ended March 31,
	2022		2021
Customer A	$	66,289	$	57,680
Customer B		*	$	38,999
Customer C		*	$	36,599
Customer D		*	$	62,569
Customer E	$	100,313		*
Customer F	$	86,585		*

*Revenues from these customers during the periods presented were less than 10% of the Company's total sales.

Reconciliation of Segment Information to Consolidated Amounts

Adjusted EBITDA is a non-GAAP measure and is presented in the following tables to reconcile the segment operating performance measure to its most directly comparable GAAP measure, Net Income (Loss).

	Three Months Ended March 31, 2022
	PAMC			CONSOL Marine Terminal		Other			Total Company
Net Income (Loss)	$	2,097		$	11,613	$	(18,160	)	$	(4,450	)
Less: Income Tax Benefit		—			—		(3,522	)		(3,522	)
Add: Interest Expense, net		189			1,531		12,632			14,352
Less: Interest Income		(415	)		—		(914	)		(1,329	)
Earnings (Loss) Before Interest & Taxes (EBIT)		1,871			13,144		(9,964	)		5,051
Add: Depreciation, Depletion & Amortization		50,956			1,165		3,833			55,954
Earnings (Loss) Before Interest, Taxes and DD&A (EBITDA)	$	52,827		$	14,309	$	(6,131	)	$	61,005
Adjustments:
Stock-Based Compensation	$	3,529		$	168	$	504		$	4,201
Loss on Debt Extinguishment		—			—		2,122			2,122
Unrealized Mark-to-Market Loss on Commodity Derivative Instruments		101,902			—		—			101,902
Total Pre-tax Adjustments		105,431			168		2,626			108,225
Adjusted EBITDA	$	158,258		$	14,477	$	(3,505	)	$	169,230

	Three Months Ended March 31, 2021
	PAMC		CONSOL Marine Terminal		Other			Total Company
Net Income (Loss)	$	42,450	$	9,149	$	(25,195	)	$	26,404
Add: Income Tax Expense		—		—		5,185			5,185
Add: Interest Expense, net		642		1,537		13,082			15,261
Less: Interest Income		—		—		(858	)		(858	)
Earnings (Loss) Before Interest & Taxes (EBIT)		43,092		10,686		(7,786	)		45,992
Add: Depreciation, Depletion & Amortization		54,781		1,214		3,902			59,897
Earnings (Loss) Before Interest, Taxes and DD&A (EBITDA)	$	97,873	$	11,900	$	(3,884	)	$	105,889
Adjustments:
Stock-Based Compensation	$	1,312	$	61	$	136		$	1,509
Gain on Debt Extinguishment		—		—		(683	)		(683	)
Total Pre-tax Adjustments		1,312		61		(547	)		826
Adjusted EBITDA	$	99,185	$	11,961	$	(4,431	)	$	106,715