-- Met Coal Pricing Settlements Exceeding $100 per Ton --
TAMPA, Fla., Dec. 16 /PRNewswire-FirstCall/ -- Walter Industries, Inc.
(NYSE: WLT) announced today that its Board of Directors has approved up to
$135 million for a capital investment program to significantly increase coal
production capacity at Jim Walter Resources Mine No. 7. The development
portion of this investment will occur over a four-year period and increase
annual production capacity by approximately 2.7 million tons starting in the
second half of 2008.
In a related announcement, Jim Walter Resources stated that it has
negotiated several international coal contracts for prices in excess of
$100 per short ton, FOB mine site. These contracts represent settlements with
new and existing customers for a substantial portion of next year's available
met coal, and will result in nearly a 100% year-over-year increase in existing
met coal contract pricing. These one-year contracts principally cover the
period July 1, 2005 through June 30, 2006.
"Our positive long-term outlook on the worldwide metallurgical coal
markets, bolstered by significant near-term increases in coal prices, provide
us the confidence to make this investment," said Don DeFosset, Chairman and
CEO of Walter Industries.
The expansion, which will be internally financed, is expected to result in
an increase in rated production capacity to approximately 8.0 million tons
when longwall mining begins. Given the long development period, the investment
will be periodically monitored by the Company and its Board of Directors for
continuing feasibility.
Walter Industries, Inc. is a diversified company with annual revenues of
$1.4 billion. The Company is a leader in affordable homebuilding, related
financing, and water transmission products, and is a significant producer of
high-quality coal for worldwide markets. Based in Tampa, Florida, the Company
employs approximately 5,000 people. For more information about Walter
Industries, please call Joe Troy, Senior Vice President-Financial Services at
(813) 871-4404.
Safe Harbor Statement
Except for historical information contained herein, the statements in this
release are forward-looking and made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. Forward-looking
statements involve known and unknown risks and uncertainties that may cause
the Company's actual results in future periods to differ materially from
forecasted results. Those risks include, among others, changes in customers'
demand for the Company's products, changes in raw material and equipment costs
and availability, geologic conditions and changes in extraction costs and
pricing in the Company's mining operations, changes in customer orders,
pricing actions by the Company's competitors, the collection of approximately
$16 million of receivables associated with a working capital adjustment
arising from the sale of a subsidiary in 2003, potential changes in the
mortgage-backed capital market, and general changes in economic conditions.
Risks associated with forward-looking statements are more fully described in
the Company's filings with the Securities and Exchange Commission. The Company
assumes no duty to update its outlook statements as of any future date.
SOURCE Walter Industries, Inc.
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CONTACT:
Joe Troy, Senior Vice President-Financial
Services, Walter Industries, Inc., +1-813-871-4404
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