Market events pulled Patriot Coal down
The Gazette's April 1 editorial about Patriot Coal says Patriot was a weak company when spun off. That position ignores an overwhelming weight of facts and history. Consider the basics:
- Patriot was launched more than five years ago with significant assets and low debt levels.
- Investors were highly enthusiastic about Patriot, and the company's market value more than quadrupled in less than a year to more than $4 billion.
- Analysts cited a bright future for the company based on its "strong balance sheet," "excellent valuation prospects" and "strong management team."
Contrary to the UMW's claims now, the union's actions at the time didn't suggest that they viewed the launch as weak - the union signed off on a key portion of the retiree health-care benefits structure at the time. And the UMW agreed to a new labor agreement with Patriot Coal companies on behalf of its members in 2011 that maintained the same retiree health-care benefit structure.
When Patriot's market value was high, the company could have strengthened its financial position. Instead, Patriot made a major acquisition of Magnum Coal Co. in mid-2008. A series of other events affecting all coal producers followed - all on Patriot's watch. These included an unprecedented global financial crisis; development of low-cost shale gas that reduced coal use; burdensome regulation by the U.S. EPA that dramatically increased Patriot's environmental compliance costs; an increase in safety regulations that increased operating costs; and a significant reduction in the price of Patriot's major product: metallurgical coal.
There's a saying that people are entitled to their own opinions but not their own facts. The recent editorial attempts to rewrite history. Readers deserve better.
Senior vice president for investor relations and corporate communications
Abstinence lecture not aimed at boys?
Did the men who funded the "God's plan for sexual purity" assemblies at George Washington and Riverside high schools practice abstinence growing up? Did the speaker say to the males at the assemblies that "If you use birth control your father probably hates you"?
Since the assembly apparently was aimed at females, are we to assume that only females have the self-discipline and intelligence to decide about their sexual behavior and that males are too morally irresponsible or impulsive to address their sexuality?
The funders and the speaker sold the intelligence and morality of both females and males short. What does that say about them?