Alliance Resource Partners, L.P. Declares Quarterly Distribution of $0.70 Per Unit
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Insights
The announcement of Alliance Resource Partners, L.P.'s (ARLP) quarterly cash distribution maintains consistency with previous quarters at $0.70 per unit, signaling a stable payout to investors. This stability in distributions can be appealing to income-focused investors, particularly in sectors like energy where volatility is common. From a financial perspective, the maintenance of a consistent distribution rate suggests that the company is managing its cash flow effectively, which is crucial for a master limited partnership (MLP) whose primary attraction is the distribution yield.
However, it's essential to monitor the sustainability of such distributions. The coverage ratio, which compares the cash flow from operations to the cash distributions paid, is a critical metric. A ratio greater than one indicates that the company is generating sufficient cash to cover its distributions, which is a positive sign for the long-term viability of the payouts. In contrast, a ratio below one could signal potential trouble ahead. Investors would benefit from examining ARLP's coverage ratio upon the release of their full financial results.
The notice regarding the treatment of ARLP's distributions to non-U.S. investors has significant tax implications. The classification of the entire distribution as 'effectively connected income' (ECI) and the instruction to withhold at the highest applicable effective tax rate plus an additional 10% is a critical detail for international investors and their intermediaries. It is imperative for brokers and nominees to adhere to these regulations to avoid penalties and ensure compliance.
For non-U.S. investors, understanding the tax treatment of their investments is essential for accurate income projections and investment decisions. The withholding tax reduces the net income received from the investment, which can affect the overall attractiveness of ARLP units to international investors. It is also important for investors to be aware of tax treaties between their country of residence and the United States that may affect the withholding rate.
For stakeholders, the announcement of the distribution amount ahead of the full financial results release allows for preliminary assessment of the company's performance. The fact that ARLP has maintained its distribution level could be interpreted as a signal of confidence by the management in the company's financial health and future prospects. In the context of the broader market, it's essential to compare ARLP's distribution yield with industry peers, as well as the company's ability to maintain or grow its distributions over time, which is a critical factor in assessing the investment's total return potential.
Additionally, the energy sector and particularly MLPs, are often subject to regulatory changes and fluctuations in commodity prices. These factors can impact profitability and, consequently, distribution levels. Investors should consider these external variables when evaluating ARLP's announcement, alongside the forthcoming detailed financial results and management's commentary during the earnings conference call.
ARLP unitholders of record as of the close of trading on February 7, 2024 will receive a cash distribution for the 2023 Quarter of
As previously announced, ARLP will report financial results for the 2023 Quarter before the market opens on Monday, January 29, 2024 and Alliance management will discuss these results during a conference call beginning at 10:00 a.m. Eastern that same day.
To participate in the conference call, dial (877) 407-0784 and request to be connected to the Alliance Resource Partners, L.P. earnings conference call. International callers should dial (201) 689-8560 and request to be connected to the same call. Investors may also listen to the call via the "Investors" section of ARLP’s website at www.arlp.com.
An audio replay of the conference call will be available for approximately one week. To access the audio replay, dial
Concurrent with this announcement we are providing qualified notice to brokers and nominees that hold ARLP units on behalf of non-U.S. investors under Treasury Regulation Section 1.1446-4(b) and (d) and Treasury Regulation Section 1.1446(f)-4(c)(2)(iii). Brokers and nominees should treat one hundred percent (
About Alliance Resource Partners, L.P.
ARLP is a diversified energy company that is currently the largest coal producer in the eastern
News, unit prices and additional information about ARLP, including filings with the Securities and Exchange Commission ("SEC"), are available at www.arlp.com. For more information, contact the investor relations department of ARLP at (918) 295-7673 or via e-mail at investorrelations@arlp.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240126230183/en/
Investor Relations Contact
Cary P. Marshall
Senior Vice President and Chief Financial Officer
918-295-7673
investorrelations@arlp.com
Source: Alliance Resource Partners, L.P.
FAQ
What is the cash distribution per unit announced by ARLP for the quarter ended December 31, 2023?
When will the cash distribution for the 2023 Quarter be payable to ARLP unitholders?
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What is the annualized rate of the cash distribution announced by ARLP?
How can investors listen to the conference call to discuss ARLP's financial results?
