(Updates with closing share price in second paragraph.)
Sept. 2 (Bloomberg) -- Cloud Peak Energy Inc., the U.S. producer of coal for power stations, tumbled after cutting its full-year shipment forecast for the second time in five weeks because of railroad bottlenecks in the western U.S.
The shares slid 8.1 percent to close at $14.44 in New York, the most since Aug. 8, 2011. Earlier the stock for the Gillette, Wyoming-based company tumbled as low as $14.17, the lowest since its initial public offering on Nov. 20, 2009.
Western coal miners have been struggling to ship their products on overloaded rail lines since last winter when frigid temperatures spurred power plants to order additional coal. It could take rail lines until early 2015 to introduce enough machine- and manpower to move the extra loads, Kevin Crutchfield, chairman and chief executive officer of coal miner Alpha Natural Resources Inc., said on an Aug. 6 conference call.
“While we believe the rail performance issues are being addressed, the reality is that the improvements have not taken place at a sufficiently robust pace to allow us to maintain our previous guidance,” Cloud Peak CEO Colin Marshall said in a statement today.
Cloud Peak’s shipments for 2014 will be 83 million to 86 million tons, compared with a previous forecast of 85 million to 89 million tons, the company said today in a statement. Cloud Peak also reduced its full-year forecast for earnings before interest, taxes, depreciation and amortization and one-time items to $170 million to $200 million, from $180 million to $210 million.
The average of 14 analysts’ estimates compiled by Bloomberg for Ebitda was $193 million.
Cloud Peak also said today that a late-August rainstorm at its Cordero Rojo mine caused flooding and equipment damage that has slowed shipments and produced additional costs.
The company said July 29, when it last cut its shipment prediction, that the forecast was predicated on improved rail service for its three mines in the Powder River Basin region in Wyoming and Montana. Rail operators have also been stretched by a glut of shipments of grain in the Midwest and crude oil.