Alliance Resource Partners L P : Quarterly Report for Quarter Ending September 30, 2024 (Form 10-Q)

Published: 2024-11-07 20:42:07 ET ARLP

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________to________________

Commission File No.: 0-26823

ALLIANCE RESOURCE PARTNERS, L.P.

(Exact name of registrant as specified in its charter)

Delaware

73-1564280

(State or other jurisdiction of

incorporation or organization)

(IRS Employer Identification No.)

1717 South Boulder Avenue, Suite 400, Tulsa, Oklahoma 74119

(Address of principal executive offices and zip code)

(918) 295-7600

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [ ] No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). [X ] Yes [ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☒

Accelerated Filer ☐

Non-Accelerated Filer ☐

Smaller Reporting Company ☐

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common unitsrepresenting limited partner interests

ARLP

NASDAQGlobal Select Market

As of November 7, 2024, 128,061,981 common units are outstanding.

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TABLE OF CONTENTS

PART I

FINANCIAL INFORMATION

Page

ITEM 1.

Financial Statements (Unaudited)

ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets as ofSeptember 30, 2024andDecember 31, 2023

Condensed Consolidated Statements of Income for thethree and nine months ended September 30, 2024 and 2023

Condensed Consolidated Statements of Comprehensive Income for thethree and nine months ended September 30, 2024 and 2023

Condensed Consolidated Statements of Cash Flows for thenine months ended September 30, 2024 and 2023

Notes to Condensed Consolidated Financial Statements

1. Organization and Presentation

2. New Accounting Standards

3. Acquisitions

4. Contingencies

5. Inventories

6. Digital Assets

7. Fair Value Measurements

8. Long-Term Debt

9. Income Taxes

10. Variable Interest Entities

11. EquityInvestments

12. Partners' Capital

13. Revenue from Contracts with Customers

14. Earnings per Limited Partner Unit

15. Workers' Compensation and Pneumoconiosis

16. Common Unit-Based Compensation Plans

17. Components of Pension Plan Net Periodic Benefit Cost

18. Segment Information

ITEM 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

ITEM 3.

Quantitative and Qualitative Disclosures about Market Risk

ITEM 4.

Controls and Procedures

Forward-Looking Statements

PART II

OTHER INFORMATION

ITEM 1.

Legal Proceedings

ITEM 1A.

Risk Factors

ITEM 2.

Unregistered Sales of Equity Securities and Use of Proceeds

ITEM 3.

Defaults Upon Senior Securities

ITEM 4.

Mine Safety Disclosures

ITEM 5.

Other Information

ITEM 6.

Exhibits

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PART I

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except unit data)

(Unaudited)

September 30,

December 31,

2024

2023

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

195,429

59,813

Trade receivables

198,647

282,622

Other receivables

10,015

9,678

Inventories, net

177,503

127,556

Advance royalties

6,170

7,780

Digital assets

28,959

9,579

Prepaid expenses and other assets

9,785

19,093

Total current assets

626,508

516,121

PROPERTY, PLANT AND EQUIPMENT:

Property, plant and equipment, at cost

4,451,796

4,172,544

Less accumulated depreciation, depletion and amortization

(2,290,205)

(2,149,881)

Total property, plant and equipment, net

2,161,591

2,022,663

OTHER ASSETS:

Advance royalties

76,295

71,125

Equity method investments

36,902

46,503

Equity securities

92,541

Operating lease right-of-use assets

16,092

16,569

Other long-term assets

22,244

22,904

Total other assets

244,074

249,642

TOTAL ASSETS

3,032,173

2,788,426

LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:

Accounts payable

115,719

108,269

Accrued taxes other than income taxes

21,336

21,007

Accrued payroll and related expenses

32,733

29,884

Accrued interest

10,637

3,558

Workers' compensation and pneumoconiosis benefits

15,790

15,913

Other current liabilities

46,662

28,498

Current maturities, long-term debt, net

22,275

20,338

Total current liabilities

265,152

227,467

LONG-TERM LIABILITIES:

Long-term debt, excluding current maturities, net

456,316

316,821

Pneumoconiosis benefits

131,727

127,249

Accrued pension benefit

7,005

8,618

Workers' compensation

36,981

37,257

Asset retirement obligations

148,849

146,925

Long-term operating lease obligations

13,838

13,661

Deferred income tax liabilities

32,019

33,450

Other liabilities

15,176

18,381

Total long-term liabilities

841,911

702,362

Total liabilities

1,107,063

929,829

COMMITMENTS AND CONTINGENCIES - (NOTE 4)

PARTNERS' CAPITAL:

ARLP Partners' Capital:

Limited Partners - Common Unitholders 128,061,981 and 127,125,437 units outstanding, respectively

1,961,977

1,896,027

Accumulated other comprehensive loss

(58,623)

(61,525)

Total ARLP Partners' Capital

1,903,354

1,834,502

Noncontrolling interest

21,756

24,095

Total Partners' Capital

1,925,110

1,858,597

TOTAL LIABILITIES AND PARTNERS' CAPITAL

3,032,173

2,788,426

See notes to condensed consolidated financial statements.

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ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except unit and per unit data)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

SALES AND OPERATING REVENUES:

Coal sales

532,647

549,123

1,607,185

1,688,238

Oil & gas royalties

34,448

34,125

107,907

101,709

Transportation revenues

24,617

34,964

82,071

95,729

Other revenues

21,857

18,309

61,453

55,603

Total revenues

613,569

636,521

1,858,616

1,941,279

EXPENSES:

Operating expenses (excluding depreciation, depletion and amortization)

384,844

339,099

1,100,308

1,012,224

Transportation expenses

24,617

34,964

82,071

95,729

Outside coal purchases

8,192

11,530

27,912

15,739

General and administrative

21,878

20,097

64,569

61,312

Depreciation, depletion and amortization

72,971

65,393

204,974

199,582

Total operating expenses

512,502

471,083

1,479,834

1,384,586

INCOME FROM OPERATIONS

101,067

165,438

378,782

556,693

Interest expense (net of interest capitalized for the three and nine months ended September 30, 2024 and 2023 of $3,521, $1,809, $8,605 and $4,432, respectively)

(9,527)

(7,736)

(26,553)

(29,845)

Interest income

2,175

2,669

5,535

8,084

Equity method investment loss

(2,327)

(1,842)

(3,032)

(3,784)

Change in fair value of digital assets

332

8,437

Other income (expense)

(681)

223

(2,245)

(173)

INCOME BEFORE INCOME TAXES

91,039

158,752

360,924

530,975

INCOME TAX EXPENSE

4,123

3,401

12,932

11,641

NET INCOME

86,916

155,351

347,992

519,334

LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST

(635)

(1,652)

(3,467)

(4,660)

NET INCOME ATTRIBUTABLE TO ARLP

86,281

153,699

344,525

514,674

NET INCOME ATTRIBUTABLE TO ARLP

GENERAL PARTNER

1,384

LIMITED PARTNERS

86,281

153,699

344,525

513,290

EARNINGS PER LIMITED PARTNER UNIT - BASIC AND DILUTED

0.66

1.18

2.64

3.93

WEIGHTED-AVERAGE NUMBER OF UNITS OUTSTANDING - BASIC AND DILUTED

128,061,981

127,125,437

127,932,095

127,198,805

See notes to condensed consolidated financial statements.

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ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

NET INCOME

86,916

155,351

347,992

519,334

OTHER COMPREHENSIVE INCOME:

Defined benefit pension plan

Amortization of prior service cost (1)

140

Amortization of net actuarial loss (1)

136

169

245

513

Total defined benefit pension plan adjustments

183

216

385

653

Pneumoconiosis benefits

Amortization of net actuarial loss (1)

839

345

2,517

1,036

Total pneumoconiosis benefits adjustments

839

345

2,517

1,036

OTHER COMPREHENSIVE INCOME

1,022

561

2,902

1,689

COMPREHENSIVE INCOME

87,938

155,912

350,894

521,023

Less: Comprehensive income attributable to noncontrolling interest

(635)

(1,652)

(3,467)

(4,660)

COMPREHENSIVE INCOME ATTRIBUTABLE TO ARLP

87,303

154,260

347,427

516,363

See notes to condensed consolidated financial statements.

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ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Nine Months Ended

September 30,

2024

2023

CASH FLOWS FROM OPERATING ACTIVITIES

634,711

730,298

CASH FLOWS FROM INVESTING ACTIVITIES:

Property, plant and equipment:

Capital expenditures

(335,586)

(295,356)

Change in accounts payable and accrued liabilities

9,191

(23,006)

Proceeds from sale of property, plant and equipment

1,385

3,436

Contributions to equity method investments

(1,398)

(2,257)

Purchase of equity securities

(49,560)

JC Resources acquisition

(64,999)

Oil & gas reserve asset acquisitions

(15,176)

(13,902)

Other

4,151

6,273

Net cash used in investing activities

(337,433)

(439,371)

CASH FLOWS FROM FINANCING ACTIVITIES:

Borrowings under securitization facility

75,000

Payments under securitization facility

(75,000)

Proceeds from equipment financings

54,626

Payments on equipment financings

(8,926)

(11,421)

Borrowings under revolving credit facilities

20,000

Payments under revolving credit facilities

(20,000)

Borrowing under long-term debt

400,000

75,000

Payments on long-term debt

(296,327)

(120,080)

Payment of debt issuance costs

(11,442)

(11,744)

Payments for purchases of units under unit repurchase program

(19,432)

Payments for tax withholdings related to settlements under deferred compensation plans

(15,544)

(10,334)

Excess purchase price over the contributed basis from JC Resources acquisition

(7,251)

Cash retained by JC Resources in acquisition

(2,933)

Distributions paid to Partners

(272,707)

(273,767)

Other

(11,342)

(7,745)

Net cash used in financing activities

(161,662)

(389,707)

NET CHANGE IN CASH AND CASH EQUIVALENTS

135,616

(98,780)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

59,813

296,023

CASH AND CASH EQUIVALENTS AT END OF PERIOD

195,429

197,243

SUPPLEMENTAL CASH FLOW INFORMATION:

Cash paid for interest

24,263

22,411

Cash paid for income taxes

16,509

10,420

SUPPLEMENTAL NON-CASH ACTIVITY:

Accounts payable for purchase of property, plant and equipment

23,777

21,275

Right-of-use assets acquired by operating lease

716

2,596

Market value of common units issued under deferred compensation plans before tax withholding requirements

34,880

28,906

See notes to condensed consolidated financial statements.

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ALLIANCE RESOURCE PARTNERS, L.P. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.ORGANIZATION AND PRESENTATION

Significant Relationships Referenced in Notes to Condensed Consolidated Financial Statements

Organization

ARLP is a Delaware limited partnership listed on the NASDAQ Global Select Market under the ticker symbol "ARLP." ARLP was formed in May 1999 and completed its initial public offering on August 19, 1999 when it acquired substantially all of the coal production and marketing assets of Alliance Resource Holdings, Inc., a Delaware corporation, and its subsidiaries. We are managed by our general partner, MGP, a Delaware limited liability company which holds a non-economic general partner interest in ARLP.

Basis of Presentation

The accompanying condensed consolidated financial statements include the accounts and operations of the ARLP Partnership and present our financial position as of September 30, 2024 and December 31, 2023, the results of our operations and comprehensive income for the three and nine months ended September 30, 2024 and 2023 and cash flows for the nine months ended September 30, 2024 and 2023. All intercompany transactions and accounts have been eliminated. Certain immaterial amounts in the prior period have been reclassified to conform to the current period presentation.

These condensed consolidated financial statements and notes are prepared pursuant to the rules and regulations of the Securities and Exchange Commission for interim reporting and do not include all the information normally included with financial statements prepared in accordance with generally accepted accounting principles ("GAAP") of the United States. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023.

These condensed consolidated financial statements and notes are unaudited. However, in the opinion of management, these condensed consolidated financial statements reflect all normal recurring adjustments necessary for a fair presentation of the results for the periods presented. Results for interim periods are not necessarily indicative of results to be expected for the full year ending December 31, 2024.

Use of Estimates

The preparation of the ARLP Partnership's condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in our condensed consolidated financial statements. Actual results could differ from those estimates.

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Digital Assets

We began our crypto-mining activities during the second half of 2020 as we started mining bitcoin as a pilot project to monetize already paid for, yet underutilized, electricity load. We continue to periodically be awarded digital assets through our crypto-mining activities. The awards are accounted for as revenue and valued at the exchange quoted price at the time they are awarded. Beginning January 1, 2024, with our adoption of the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60) ("ASU 2023-08"), the digital assets we hold are subsequently remeasured to fair value based on the exchange quoted price as of the balance sheet date and included on our condensed consolidated balance sheets within the Digital assets line item. The activity from remeasurement of digital assets to fair value is reflected in our condensed consolidated statements of income within the Change in fair value of digital assets line item. Digital assets sold for cash nearly immediately after they are awarded to us for mining activities are presented as cash flows from operating activities, while other sales are reflected as cash flows from investing activities in our condensed consolidated statements of cash flows. Our realized gains or losses are determined as the difference between the proceeds received when the digital assets are sold and our cost basis in the digital assets. Our cost basis is the value of the digital assets when they are awarded less any impairment recognized prior to our adoption of ASU 2023-08. We use a first-in, first-out methodology to assign costs to our digital assets in the calculation of our realized gains or losses. See Note 6 - Digital Assets for additional information.

2.NEW ACCOUNTING STANDARDS

New Accounting Standards Issued and Adopted

In December 2023, the FASB issued ASU 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60) ("ASU 2023-08"), which requires an entity to measure certain digital assets at fair value with changes in the fair value recognized in net income. In addition, the guidance requires additional disclosures related to digital assets once adopted. We adopted ASU 2023-08, effective January 1, 2024, which resulted in a cumulative-effect adjustment to increase the opening balance of Partners' Capital by $6.2 million. See Note 6 - Digital Assets for more information on our digital assets.

New Accounting Standards Issued and Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"). ASU 2023-07 primarily requires enhanced disclosures about significant segment expenses regularly provided to the chief operating decision maker ("CODM"), the amount and composition of other segment items, and the title and position of the CODM. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 with early adoption permitted. We do not expect ASU 2023-07 to have a material effect on our consolidated financial statements but will result in changes in our segment reporting disclosures upon adoption.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). ASU 2023-09 primarily requires enhanced disclosures to (1) disclose specific categories in the rate reconciliation, (2) disclose the amount of income taxes paid and expensed disaggregated by federal, state, and foreign taxes, with further disaggregation by individual jurisdictions if certain criteria are met, and (3) disclose income (loss) from continuing operations before income tax (benefit) disaggregated between domestic and foreign. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of adopting ASU 2023-09, but do not expect it to have a material effect on our consolidated financial statements.

3.ACQUISITIONS

Acquisition Agreement

On January 27, 2023, we entered into a one-year collaborative agreement with a third party, effective January 1, 2023, committing up to $35.0 million for the acquisition of oil & gas mineral interests in the Midland and Delaware Basins. On February 19, 2024, we renewed this agreement for an additional one-year term, committing up to $25.0 million. Under the agreement, the third party assists us in the identification, evaluation, and acquisition of target oil & gas mineral interests. In exchange for these services, the third party receives a participation share, partially funded by the third party,

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and is paid a periodic management fee. During the nine months ended September 30, 2024, we purchased $5.1 million and $7.8 million of oil & gas mineral interests in proved and unproved properties, respectively, pursuant to this agreement. Management fees paid under this agreement have been immaterial.

Miscellaneous Acquisitions

In addition to the acquisitions under the collaborative agreement discussed above, we purchased $0.7 million and $1.6 million of oil & gas mineral interests in proved and unproved properties, respectively, during the nine months ended September 30, 2024.

4.CONTINGENCIES

Certain of our subsidiaries are party to litigation in which the plaintiffs allege violations of the Fair Labor Standards Act and state law due to alleged failure to compensate for time "donning" and "doffing" equipment and to account for certain bonuses in the calculation of overtime rates and pay. In April 2024, we entered into a settlement agreement with the plaintiffs pursuant to which we agreed to settle such litigation for $15.3 million. As a result of reaching this settlement, which is subject to court approval, we have accrued $15.3 million as of September 30, 2024. Our $15.3 million accrual is included in the Other current liabilities line item on our condensed consolidated balance sheet.

We also have various other lawsuits, claims and regulatory proceedings incidental to our business that are pending against the ARLP Partnership. We record an accrual for a potential loss related to these matters when, in management's opinion, such loss is probable and reasonably estimable. Based on known facts and circumstances, we believe the ultimate outcome of these outstanding lawsuits, claims and regulatory proceedings will not have a material adverse effect on our financial condition, results of operations or liquidity. However, if the results of these matters are different from management's current expectations and in amounts greater than our accruals (if any), such matters could have a material adverse effect on our business and operations.

5.INVENTORIES

Inventories consist of the following:

September 30,

December 31,

2024

2023

(in thousands)

Coal

95,333

56,549

Finished goods (net of reserve for obsolescence of $723 and $728, respectively)

3,812

3,908

Work in process

580

791

Raw materials

1,838

2,144

101,563

63,392

Supplies (net of reserve for obsolescence of $8,036 and $7,439, respectively)

75,940

64,164

Total inventories, net

177,503

127,556

The above balances reflect lower of cost or net realizable value adjustments of $5.9 million to our coal inventories. These adjustments are primarily a result of lower coal sale prices and higher cost per ton at the Mettiki Mining, LLC ("Mettiki") and MC Mining, LLC ("MC Mining") mining complexes.

Certain of our subsidiaries, primarily consisting of Matrix Design Group, LLC, its subsidiaries, and Alliance Design Group, LLC (collectively referred to as "Matrix Group"), manufacture a variety of products for our mining operations and third parties. These products are primarily consumed internally by our mining operations with associated inventory historically presented as supplies inventory. Recently Matrix Group has been increasing its production of products with the intention to increase third-party sales. We have therefore presented our manufactured goods inventories in the table above separately from our historical presentation of supplies inventory.

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6.DIGITAL ASSETS

The following table sets forth our digital assets as shown on the condensed consolidated balance sheet:

September 30, 2024

Units

Cost Basis

Fair Value

Digital assets:

(in thousands, except unit data)

Bitcoin

457.24

16,327

28,959

Total

16,327

28,959

The following table represents a reconciliation of the fair values of our digital assets:

Three Months Ended

Nine Months Ended

September 30,

2024

Digital assets:

(in thousands)

Beginning balance

28,335

15,811

Additions

1,709

7,848

Dispositions

(1,417)

(3,137)

Fair value gains

332

8,437

Ending balance

28,959

As discussed in Note 2 - New Accounting Standards, our beginning balance is inclusive of a cumulative-effect adjustment of $6.2 million as of January 1, 2024. Additions are the result of awarded digital assets received from our crypto-mining activities, while dispositions are the result of sales and payments for services. During the three and nine months ended September 30, 2024, we had digital asset dispositions of $1.4 million and $3.1 million, respectively, inclusive of realized gains of $1.0 million and $2.1 million, respectively.

7.FAIR VALUE MEASUREMENTS

The following table summarizes certain fair value measurements within the hierarchy not included elsewhere in these notes:

Fair Value

Carrying Value

Level 1

Level 2

Level 3

(in thousands)

September 30, 2024

Recorded on a recurring basis:

Digital assets (1)

28,959

Additional disclosures:

Long-term debt

496,958

528,540

December 31, 2023

Additional disclosures:

Long-term debt

347,584

347,116

The carrying amounts for cash equivalents, accounts receivable, accounts payable, accrued and other liabilities approximate fair value due to the short maturity of those instruments.

The fair value of our digital assets is based on an exchange quoted price. See Note 6 - Digital Assets for more information on our digital assets.

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The estimated fair value of our long-term debt, including current maturities, is based on interest rates that we believe are currently available to us in active markets for issuance of debt with similar terms and remaining maturities. See Note 8 - Long-Term Debt for additional information on our long-term debt.

8.LONG-TERM DEBT

Long-term debt consists of the following:

Unamortized Discount and

Principal

Debt Issuance Costs

September 30,

December 31,

September 30,

December 31,

2024

2023

2024

2023

(in thousands)

Revolving credit facility

(7,788)

(8,118)

Term loan

49,219

60,938

(1,375)

(1,416)

8.625% Senior notes due 2029

400,000

(9,204)

7.5% Senior notes due 2025

284,607

(891)

Securitization facility

June 2020 equipment financing

2,039

February 2024 equipment financing

47,739

496,958

347,584

(18,367)

(10,425)

Less current maturities

(26,669)

(20,789)

4,394

451

Total long-term debt

470,289

326,795

(13,973)

(9,974)

Credit Facility

On January 13, 2023, Alliance Coal, as borrower, entered into a Credit Agreement with various financial institutions which was amended on June 12, 2024 (the "Credit Agreement"). The Credit Agreement provides for a $425 million revolving credit facility which includes a sublimit of $15.0 million for swingline borrowings and permits the issuance of letters of credit up to the full amount of the Credit Facility (the "Revolving Credit Facility"), and for a term loan in an aggregate principal amount of $75 million (the "Term Loan"). The Revolving Credit Facility also includes an incremental facility providing for an increase of $100.0 million at our option subject to lenders agreeing to participate in such incremental facility. The Credit Agreement matures on March 9, 2028, at which time the aggregate outstanding principal amount of all Revolving Credit Facility advances and all Term Loan advances are required to be repaid in full. Interest is payable quarterly, with principal on the Term Loan due in quarterly installments equal to 6.25% of the outstanding balance of the Term Loan on the Credit Agreement amendment date beginning with the quarter ended June 30, 2024.

The Revolving Credit Facility is underwritten by a syndicate of several financial institutions and the obligations of the lenders are individual obligations, which means the failure of one or more lenders to be able to fund its obligation does not relieve the remaining lenders from funding their obligations. Based on our diligence, including discussions with representatives of certain of these financial institutions, as of September 30, 2024 we have no reason to believe that the banks within our syndicate are facing financial difficulties, defaults or limited liquidity situations that would cause them to be unable to fund their obligations under the Credit Agreement. However, should any of the banks in our syndicate experience conditions in the future that limit their ability to fund their obligations, the amount available under the Revolving Credit Facility could be reduced.

The Credit Agreement is guaranteed by ARLP and certain of its subsidiaries, including the Intermediate Partnership and most of the direct and indirect subsidiaries of Alliance Coal (the "Subsidiary Guarantors"). The Credit Agreement also is secured by substantially all of the assets of the Subsidiary Guarantors and Alliance Coal. Borrowings under the Credit Agreement bear interest, at our option, at either (i) an adjusted one-month, three-month or six-month term rate based on the secured overnight financing rate published by the Federal Reserve Bank of New York, plus the applicable margin or (ii) the base rate plus the applicable margin. The base rate is the highest of (i) the Overnight Bank Funding Rate plus 0.50%, (ii) the Administrative Agent's prime rate, and (iii) the Daily Simple Secured Overnight Financing Rate plus 100 basis points. The applicable margin for borrowings under the Credit Agreement are determined by reference to the Consolidated Debt to Consolidated Cash Flow Ratio. For borrowings under the Term Loan, we elected the one-month term rate, with applicable margin, which was 8.2% as of September 30, 2024. At September 30, 2024, we had $41.0

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million of letters of credit outstanding with $384.0 million available for borrowing under the Revolving Credit Facility. We incur an annual commitment fee of 0.50% on the undrawn portion of the Revolving Credit Facility. We utilize the Credit Agreement, as appropriate, for working capital requirements, capital expenditures and investments, scheduled debt payments and distribution payments.

The Credit Agreement contains various restrictions affecting Alliance Coal and its subsidiaries, including, among other things, restrictions on incurrence of additional indebtedness and liens, sale of assets, investments, mergers and consolidations and transactions with affiliates. In each case, these restrictions are subject to various exceptions. In addition, restrictions apply to cash distributions by Alliance Coal to the Intermediate Partnership if such distribution would result in exceeding the debt of Alliance Coal to cash flow ratio (as determined in the Credit Agreement) being more than 1.0to 1.0or in Alliance Coal having liquidity of less than $200million. The Credit Agreement requires us to maintain (a) a debt of Alliance Coal to cash flow ratio of not more than 1.5to 1.0, (b) a consolidated debt of Alliance Coal and the Intermediate Partnership to cash flow ratio of not more than 2.5to 1.0and (c) an interest coverage ratio of not less than 3.0to 1.0, in each case, during the four most recently ended fiscal quarters. The debt of Alliance Coal to cash flow ratio, consolidated debt of Alliance Coal and the Intermediate Partnership to cash flow ratio, and interest coverage ratio were 0.17to 1.0, 0.84to 1.0and 43.19to 1.0, respectively, for the trailing twelve monthsended September 30, 2024. We were in compliance with the covenants of the Credit Agreement as of September 30, 2024 and anticipate remaining in compliance with the covenants.

8.625% Senior Notes due 2029

On June 12, 2024, the Intermediate Partnership and Alliance Resource Finance Corporation (as co-issuer), a wholly owned subsidiary of the Intermediate Partnership ("Alliance Finance"), issued an aggregate principal amount of $400.0million of senior unsecured notes due 2029 (the "2029 Senior Notes") in a private placement to qualified institutional buyers. The 2029 Senior Notes have a term of five years, maturing on June 15, 2029 and accrue interest at an annual rate of 8.625%. Interest is payable semi-annually in arrears on each June 15 and December 15. The 2029 Senior Notes are guaranteed, jointly and severally, on a senior unsecured basis by ARLP, certain of ARLP's wholly owned oil and gas and coal royalties subsidiaries and each of ARLP's subsidiaries that guarantee obligations under the Credit Agreement. The indenture governing the 2029 Senior Notes contains customary terms, events of default and covenants relating to, among other things, the incurrence of debt, the payment of distributions or similar restricted payments, undertaking transactions with affiliates and limitations on asset sales.

At any time prior to June 15, 2026, the issuers may redeem up to 35% of the aggregate principal amount of the 2029 Senior Notes at a redemption price equal to 108.625% of the principal amount redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, with an amount of cash not greater than the net proceeds from one or more equity offerings. The issuers may also redeem all or a part of the 2029 Senior Notes at any time on or after June 15, 2026, at the redemption prices set forth in the indenture, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. At any time prior to June 15, 2026, the issuers may redeem the 2029 Senior Notes at a redemption price equal to the principal amount plus a "make-whole" premium, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.

In addition, if prior to June 15, 2026, a Specified Minerals Disposition (as defined in the indenture governing the 2029 Senior Notes and which involves oil and gas mineral interests) occurs, the issuers will be required to make an offer to purchase up to 40% of the aggregate principal amount of 2029 Senior Notes then outstanding at an offer price in cash in an amount equal to 108.625% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase.

7.5% Senior Notes due 2025

On April 24, 2017, the Intermediate Partnership and Alliance Finance (as co-issuer) issued an aggregate principal amount of $400.0million of senior unsecured notes due 2025 in a private placement to qualified institutional buyers. The 7.5% Senior Notes due 2025 had a term of eight years, maturing on May 1, 2025 and accrued interest at an annual rate of 7.5%. In June 2024, we used a portion of the net proceeds from the offering of the 2029 Senior Notes to redeem the outstanding balance of the 7.5% Senior Notes due 2025.

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Accounts Receivable Securitization

Certain direct and indirect wholly owned subsidiaries of our Intermediate Partnership are party to a $90.0 million accounts receivable securitization facility ("Securitization Facility") which matures in January 2025. Under the Securitization Facility, certain subsidiaries sell certain trade receivables on an ongoing basis to our Intermediate Partnership, which then sells the trade receivables to AROP Funding, LLC ("AROP Funding"), a wholly owned bankruptcy-remote special purpose subsidiary of our Intermediate Partnership, which in turn borrows on a revolving basis up to $90.0 million secured by the trade receivables. After the sale, Alliance Coal, as servicer of the assets, collects the receivables on behalf of AROP Funding. The Securitization Facility bears interest based on a short-term bank yield index. On September 30, 2024, we had $11.7 million of letters of credit outstanding with $78.3 million available for borrowing under the Securitization Facility. The agreement governing the Securitization Facility contains customary terms and conditions, including limitations with regards to certain customer credit ratings.

June 2020 Equipment Financing

On June 5, 2020, the Intermediate Partnership entered into an equipment financing arrangement accounted for as debt, wherein the Intermediate Partnership received $14.7million in exchange for conveying its interest in certain equipment owned indirectly by the Intermediate Partnership and entering into a master lease agreement for that equipment (the "June 2020 Equipment Financing"). The June 2020 Equipment Financing contained customary terms and events of default and provided for forty-eightmonthly payments with an implicit interest rate of 6.1%. The June 2020 Equipment Financing matured on June 5, 2024 and the equipment reverted back to the Intermediate Partnership.

February 2024 Equipment Financing

On February 28, 2024, Alliance Coal entered into an equipment financing arrangement accounted for as debt, wherein Alliance Coal received $54.6million in exchange for conveying its interest in certain equipment owned indirectly by Alliance Coal and entering into a master lease agreement for that equipment (the "February 2024 Equipment Financing"). The February 2024 Equipment Financing contains customary terms and events of default and provides for forty-eightmonthly payments with an implicit interest rate of 8.29%, maturing on February 28, 2028. Upon maturity, the equipment will revert to Alliance Coal.

9.INCOME TAXES

Components of income tax expense are as follows:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Current:

Federal

4,567

5,429

13,791

13,676

State

320

373

975

946

4,887

5,802

14,766

14,622

Deferred:

Federal

(712)

(2,077)

(1,678)

(2,598)

State

(52)

(324)

(156)

(383)

(764)

(2,401)

(1,834)

(2,981)

Income tax expense

4,123

3,401

12,932

11,641

The effective income tax rates for our income tax expense for the three and nine months ended September 30, 2024 and 2023 are less than the federal statutory rate, primarily due to the portion of income not subject to income taxes.

Our 2020 through 2023 tax years remain open to examination by tax authorities, and certain lower-tier partnership income tax returns for the tax years ended December 31, 2020 and 2021 are being audited by the Internal Revenue Service.

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10.VARIABLE INTEREST ENTITIES

AllDale I & II and Cavalier Minerals

We own the general partner interests and, including the limited partner interests we hold through our ownership in Cavalier Minerals JV, LLC ("Cavalier Minerals"), approximately 97% of the limited partner interests in AllDale Minerals LP ("AllDale I") and AllDale Minerals II, LP ("AllDale II", and collectively with AllDale I, "AllDale I & II"). As the general partner of AllDale I & II, we are entitled to receive 20.0% of all distributions from AllDale I & II with the remaining 80.0% allocated to limited partners based upon ownership percentages.

Cavalier Minerals owns approximately 72% of the limited partner interests in AllDale I & II. We own the managing member interest and a 96% member interest in Cavalier Minerals. Bluegrass Minerals Management, LLC ("Bluegrass Minerals") owns a 4% member interest in Cavalier Minerals and a profits interest which entitles it to receive distributions equal to 25% of all distributions (including in liquidation) after all members have recovered their investment. All members have recovered their investment and Bluegrass Minerals began receiving its profits interest distributions in late 2022.

We have concluded that AllDale I, AllDale II and Cavalier Minerals are variable interest entities ("VIEs") which we consolidate as the primary beneficiary because we have the power to direct the activities that most significantly impact the economic performance of AllDale I, AllDale II and Cavalier Minerals in addition to having substantial equity ownership.

Our share of Cavalier Minerals' investment in AllDale I & II is eliminated in consolidation and Bluegrass Minerals' investment in Cavalier Minerals is accounted for as noncontrolling ownership interest on our condensed consolidated balance sheets. Additionally, earnings attributable to Bluegrass Minerals are recognized as noncontrolling interest in our condensed consolidated statements of income.

The following table presents the carrying amounts and classification of AllDale I & II's assets and liabilities included in our condensed consolidated balance sheets:

September 30,

December 31,

2024

2023

Assets (liabilities):

(in thousands)

Cash and cash equivalents

6,040

4,690

Trade receivables

12,581

16,058

Total property, plant and equipment, net

377,236

389,767

Accounts payable

(253)

(175)

Accrued taxes other than income taxes

(682)

(958)

AllDale III

AllDale Minerals III, LP ("AllDale III") owns oil & gas mineral interests in areas around the oil & gas mineral interests we own. Alliance Minerals owns a 13.9% limited partner interest in AllDale III. Alliance Minerals' investment in AllDale III is subject to a 25% profits interest for the general partner that is subject to a return hurdle equal to the greater of 125% of cumulative capital contributions and a 10% internal rate of return, and following an 80/20 "catch-up" provision for the general partner.

We have concluded that AllDale III is a VIE that we do not consolidate. AllDale III is structured as a limited partnership with the limited partners (1) not having the ability to remove the general partner and (2) not participating significantly in the operational decisions. We are not the primary beneficiary of AllDale III because we do not have the power to direct the activities that most significantly impact AllDale III's economic performance. See Note 11 - Equity Investments for more information about the accounting for our investment in AllDale III.

Francis

On April 5, 2022, we invested $20 million in Francis Renewable Energy, LLC ("Francis"), in the form of a convertible note. Our convertible note matured on April 1, 2023 and was converted into a preferred equity interest in

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Francis. Prior to conversion, we had determined the note more closely represented equity as opposed to debt. Therefore, we accounted for the convertible note as an equity contribution even though we did not participate in Francis' earnings or losses and were not eligible to receive distributions during the term of the note. Subsequent to the conversion on April 1, 2023, we participate in earnings and losses and are eligible to receive distributions. As of September 30, 2024, we held approximately 16.7% of Francis' equity.

We have concluded that Francis is a VIE that we do not consolidate. Francis' management structure is similar to a limited partnership with the non-managing members (i) not having the ability to remove the managing member and (ii) not participating significantly in the operational decisions. We are not the primary beneficiary of Francis because we do not have the power to direct the activities that most significantly impact Francis's economic performance. See Note 11 - Equity Investments for more information about the accounting for our investment in Francis.

NGP ET IV

On June 2, 2022, we committed to purchase $25.0 million of limited partner interests in NGP Energy Transition, L.P. ("NGP ET IV"), a private equity fund sponsored by NGP and focused on investments that are part of the global transition toward a lower carbon economy. This commitment represents a 3.6% interest in NGP ET IV. As of September 30, 2024, we have funded $8.0 million of this commitment.

We have concluded that NGP ET IV is a VIE that we do not consolidate. NGP ET IV is structured as a limited partnership with limited partners (i) not having the ability to remove the general partner and (ii) not participating significantly in the operational decisions. We are not the primary beneficiary of NGP ET IV because we do not have the power to direct the activities that most significantly impact NGP ET IV's economic performance. See Note 11 - Equity Investments for more information about the accounting for our investment in NGP ET IV.

11. EQUITY INVESTMENTS

AllDale III

We account for our ownership interest in the income or loss of AllDale III as an equity method investment. We record equity income or loss based on AllDale III's distribution structure. The changes in our equity method investment in AllDale III were as follows:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Beginning balance

23,218

24,451

23,933

25,284

Equity method investment income

496

578

1,781

1,719

Distributions received

(849)

(904)

(2,849)

(2,878)

Ending balance

22,865

24,125

22,865

24,125

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Francis

We account for our ownership interest in the income or loss of Francis as an equity method investment. Prior to the conversion of our convertible note, we did not participate in Francis' earnings or losses; however, upon conversion on April 1, 2023 we began participating. As a development stage company, Francis depends primarily on capital contributions to meet its operating and debt obligations. The changes in our equity method investment in Francis were as follows:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Beginning balance

14,518

17,380

16,487

20,000

Equity method investment loss

(2,487)

(2,435)

(4,456)

(5,055)

Change in our share of Francis' net assets

(5,118)

Ending balance

6,913

14,945

6,913

14,945

We have not impaired our initial investment and currently believe that the carrying value of our investment is recoverable.

NGP ET IV

We account for our ownership interest in the income or loss of NGP ET IV as an equity method investment. The changes in our equity method investment in NGP ET IV were as follows:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Beginning balance

7,352

4,958

6,083

4,087

Contributions

108

923

1,398

2,257

Equity method investment income (loss)

(336)

(357)

(448)

Ending balance

7,124

5,896

7,124

5,896

Infinitum

During 2022, we purchased $42.0 million of Series D Preferred Stock ("Series D Preferred Stock") in Infinitum Electric, Inc. ("Infinitum"), a Texas-based startup developer and manufacturer of electric motors featuring printed circuit board stators. On September 8, 2023, we purchased $24.6 million of Series E Preferred Stock ("Series E Preferred Stock" and, together with the "Series D Preferred Stock," the "Infinitum Preferred Stock") in Infinitum. The Infinitum Preferred Stock provides for non-cumulative dividends when and if declared by Infinitum's board of directors. Each share of Infinitum Preferred Stock is convertible, at any time, at our option, into shares of common stock of Infinitum. We account for our ownership interest in Infinitum as an equity investment without a readily determinable fair value. Absent an observable price change, it is not practicable to estimate the fair value of our investment in Infinitum because of the lack of a quoted market price for our ownership interests. Therefore, we use a measurement alternative other than fair value to account for our investment.

Ascend

On August 22, 2023, we purchased $25.0 million of Series D Preferred Stock (the "Ascend Preferred Stock") in Ascend Elements, Inc. ("Ascend"), a U.S.-based manufacturer and recycler of sustainable, engineered battery materials for electric vehicles. The Ascend Preferred Stock provides for non-cumulative dividends when and if declared by Ascend's board of directors. Each share is convertible, at any time, at our option, into shares of common stock of Ascend. We account for our ownership interest in Ascend as an equity investment without a readily determinable fair value. Absent an observable price change, it is not practicable to estimate the fair value of our investment in Ascend because of the lack of a quoted market price for our ownership interests. Therefore, we use a measurement alternative other than fair value to account for our investment.

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12.PARTNERS' CAPITAL

Distributions

Distributions paid or declared during 2023 and 2024 were as follows:

Payment Date

Per Unit Cash Distribution

Total Cash Distribution

(in thousands)

February 14, 2023

0.70

91,938

May 15, 2023

0.70

90,930

August 14, 2023

0.70

90,899

November 14, 2023

0.70

90,812

Total

2.80

364,579

February 14, 2024

0.70

91,246

May 15, 2024

0.70

90,736

August 14, 2024

0.70

90,725

November 14, 2024 (1)

0.70

Total

2.80

272,707

Unit Repurchase Program

In January 2023, the board of directors of MGP authorized a $93.5 million increase to the unit repurchase program authorizing us to be able to repurchase up to a total of $100.0 million of ARLP common units from that date. No units were repurchased during the nine months ended September 30, 2024. During the nine months ended September 30, 2023, we repurchased and retired 929,842 units at an average unit price of $20.90 for an aggregate purchase price of $19.4 million. Since inception of the unit repurchase program, we have repurchased and retired 6,390,446 units at an average unit price of $17.67 for an aggregate purchase price of $112.9 million.

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Change in Partners' Capital

The following tables present the quarterly change in Partners' Capital for the three and nine months ended September 30, 2024 and 2023:

Accumulated

Number of

Limited

Other

Limited Partner

Partners'

Comprehensive

Noncontrolling

Total Partners'

Units

Capital

Income (Loss)

Interest

Capital

(in thousands, except unit data)

Balance at January 1, 2024

127,125,437

1,896,027

(61,525)

24,095

1,858,597

Cumulative-effect adjustment (see Note 2)

6,232

Comprehensive income:

Net income

158,057

1,510

159,567

Actuarially determined long-term liability adjustments

923

Total comprehensive income

160,490

Settlement of deferred compensation plans

936,544

(13,292)

Common unit-based compensation

2,604

Distributions on deferred common unit-based compensation

(2,261)

Distributions from consolidated company to noncontrolling interest

(1,981)

Distributions to Partners

(88,985)

Balance at March 31, 2024

128,061,981

1,958,382

(60,602)

23,624

1,921,404

Comprehensive income:

Net income

100,187

1,322

101,509

Actuarially determined long-term liability adjustments

957

Total comprehensive income

102,466

Common unit-based compensation

2,926

Distributions on deferred common unit-based compensation

(1,091)

Distributions from consolidated company to noncontrolling interest

(1,942)

Distributions to Partners

(89,645)

Balance at June 30, 2024

128,061,981

1,970,759

(59,645)

23,004

1,934,118

Comprehensive income:

Net income

86,281

635

86,916

Actuarially determined long-term liability adjustments

1,022

Total comprehensive income

87,938

Settlement of deferred compensation plans

(2,252)

Common unit-based compensation

3,032

Distributions on deferred common unit-based compensation

(1,082)

Distributions from consolidated company to noncontrolling interest

(1,883)

Distributions to Partners

(89,643)

Other

(5,118)

Balance at September 30, 2024

128,061,981

1,961,977

(58,623)

21,756

1,925,110

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Accumulated

Number of

Limited

General

Other

Limited Partner

Partners'

Partner's

Comprehensive

Noncontrolling

Total Partners'

Units

Capital

Income (Loss)

Interest

Capital

(in thousands, except unit data)

Balance at January 1, 2023

127,195,219

1,656,025

66,548

(41,054)

26,507

1,708,026

Comprehensive income:

Net income

189,801

1,384

1,493

192,678

Actuarially determined long-term liability adjustments

565

Total comprehensive income

193,243

Settlement of deferred compensation plans

860,060

(9,320)

Purchase of units under unit repurchase program

(860,060)

(18,209)

Common unit-based compensation

2,830

Distributions on deferred common unit-based compensation

(2,901)

Distributions from consolidated company to affiliate noncontrolling interest

(2,288)

JC Resources acquisition

(7,251)

(64,999)

(72,250)

Cash retained by JC Resources in acquisition

(2,933)

Distributions to Partners

(89,037)

Balance at March 31, 2023

127,195,219

1,721,938

(40,489)

25,712

1,707,161

Comprehensive income:

Net income

169,790

1,515

171,305

Actuarially determined long-term liability adjustments

563

Total comprehensive income

171,868

Settlement of deferred compensation plans

(1,014)

Purchase of units under unit repurchase program

(69,782)

(1,223)

Common unit-based compensation

3,121

Distributions on deferred common unit-based compensation

(1,895)

Distributions from consolidated company to noncontrolling interest

(2,226)

Distributions to Partners

(89,035)

Balance at June 30, 2023

127,125,437

1,801,682

(39,926)

25,001

1,786,757

Comprehensive income:

Net income

153,699

1,652

155,351

Actuarially determined long-term liability adjustments

561

Total comprehensive income

155,912

Common unit-based compensation

3,239

Distributions on deferred common unit-based compensation

(1,911)

Distributions from consolidated company to noncontrolling interest

(2,081)

Distributions to Partners

(88,988)

Balance at September 30, 2023

127,125,437

1,867,721

(39,365)

24,572

1,852,928

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13.REVENUE FROM CONTRACTS WITH CUSTOMERS

The following table illustrates the disaggregation of our revenues by type, including a reconciliation to our segment presentation as presented in Note 18 - Segment Information.

Coal Operations

Royalties

Other,

Illinois

Corporate and

Basin

Appalachia

Oil & Gas

Coal

Elimination

Consolidated

(in thousands)

Three Months Ended September 30, 2024

Coal sales

337,816

194,831

532,647

Oil & gas royalties

34,448

Coal royalties

16,647

(16,647)

Transportation revenues

16,764

7,853

24,617

Other revenues

2,331

480

240

18,806

21,857

Total revenues

356,911

203,164

34,688

16,647

2,159

613,569

Three Months Ended September 30, 2023

Coal sales

342,744

206,379

549,123

Oil & gas royalties

34,125

Coal royalties

16,763

(16,763)

Transportation revenues

25,992

8,972

34,964

Other revenues

2,897

449

2,186

12,777

18,309

Total revenues

371,633

215,800

36,311

16,763

(3,986)

636,521

Nine Months Ended September 30, 2024

Coal sales

1,040,419

566,766

1,607,185

Oil & gas royalties

107,907

Coal royalties

51,933

(51,933)

Transportation revenues

61,810

20,261

82,071

Other revenues

7,284

2,363

563

51,233

61,453

Total revenues

1,109,513

589,390

108,470

51,943

(700)

1,858,616

Nine Months Ended September 30, 2023

Coal sales

1,011,467

676,771

1,688,238

Oil & gas royalties

101,709

Coal royalties

48,843

(48,843)

Transportation revenues

68,498

27,231

95,729

Other revenues

7,466

1,299

3,551

43,287

55,603

Total revenues

1,087,431

705,301

105,260

48,843

(5,556)

1,941,279

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The following table illustrates the amount of our transaction price for all current coal supply contracts allocated to performance obligations that are unsatisfied or partially unsatisfied as of September 30, 2024 and disaggregated by segment and contract duration.

2027 and

2024

2025

2026

Thereafter

Total

(in thousands)

Illinois Basin Coal Operations coal revenues

361,441

668,579

415,415

355,100

1,800,535

Appalachia Coal Operations coal revenues

202,928

431,993

100,010

30,105

765,036

Total coal revenues (1)

564,369

1,100,572

515,425

385,205

2,565,571

(1) Coal revenues generally consists of consolidated revenues excluding our Oil & Gas Royalties segment as well as intercompany revenues from our Coal Royalties segment.

14.EARNINGS PER LIMITED PARTNER UNIT

We utilize the two-class method in calculating basic and diluted earnings per limited partner unit ("EPU"). Subsequent to the acquisition of oil & gas net royalty acres from JC Resources LP on February 22, 2023 (the "JC Resources Acquisition"), net income attributable to ARLP is allocated to limited partners and participating securities with nonforfeitable distributions or distribution equivalents, while net losses attributable to ARLP are allocated only to limited partners but not to participating securities. Prior to the JC Resources Acquisition, in addition to limited partners and participating securities allocations, amounts were also allocated to our general partner for historical earnings from the mineral interests acquired in the JC Resources Acquisition.

Our participating securities are outstanding restricted unit awards under our Long-Term Incentive Plan ("LTIP") and phantom units in notional accounts under our Supplemental Executive Retirement Plan ("SERP") and the MGP Amended and Restated Deferred Compensation Plan for Directors ("Directors' Deferred Compensation Plan").

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The following is a reconciliation of net income attributable to ARLP used for calculating basic and diluted earnings per unit and the weighted-average units used in computing EPU:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands, except per unit data)

Net income attributable to ARLP

86,281

153,699

344,525

514,674

Less:

General partner's interest in net income attributable to ARLP

(1,384)

Limited partners' interest in net income attributable to ARLP

86,281

153,699

344,525

513,290

Less:

Distributions to participating securities

(1,616)

(2,414)

(4,984)

(7,242)

Undistributed earnings attributable to participating securities

(1,652)

(1,378)

(6,596)

Net income attributable to ARLP available to limited partners

84,665

149,633

338,163

499,452

Weighted-average limited partner units outstanding - basic and diluted

128,062

127,125

127,932

127,199

Earnings per limited partner unit - basic and diluted (1)

0.66

1.18

2.64

3.93

15.WORKERS' COMPENSATION AND PNEUMOCONIOSIS

The changes in the workers' compensation liability, including current and long-term liability balances, for each of the periods presented were as follows:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Beginning balance

47,194

51,108

47,975

49,452

Changes in accruals

3,658

3,001

10,148

9,071

Payments

(3,784)

(3,503)

(11,278)

(10,008)

Interest accretion

509

551

1,527

1,652

Valuation loss (gain) (1)

(795)

990

Ending balance

47,577

51,157

47,577

51,157

We limit our exposure to traumatic injury claims by purchasing a high deductible insurance policy that starts paying benefits after deductibles for a claim have been met. The deductible level may vary by claim year. Our workers'

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compensation liability above is presented on a gross basis and does not include our expected receivables from our insurance policy. Our receivables for traumatic injury claims under this policy as of September 30, 2024 are $4.1 million and are included in Other long-term assets on our condensed consolidated balance sheet.

Certain of our mine operating entities are liable under state statutes and the Federal Coal Mine Health and Safety Act of 1969, as amended, to pay pneumoconiosis, or black lung, benefits to eligible employees and former employees and their dependents. Components of the net periodic benefit cost for each of the periods presented are as follows:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Service cost

864

678

2,583

2,022

Interest cost (1)

1,558

1,237

4,674

3,713

Net amortization (1)

839

345

2,517

1,036

Net periodic benefit cost

3,261

2,260

9,774

6,771

16.COMMON UNIT-BASED COMPENSATION PLANS

Long-Term Incentive Plan

A summary of non-vested LTIP grants of restricted units is as follows:

Number of units

Weighted average grant date fair value per unit

Intrinsic value

(in thousands)

Non-vested grants at January 1, 2024

2,710,344

10.91

51,405

Granted (1)

455,574

19.69

Vested (2)

(1,582,422)

6.53

Forfeited

(38,204)

16.08

Non-vested grants at September 30, 2024

1,545,292

17.87

38,632

LTIP expense for grants of restricted units was $2.4million and $2.7million for the three months ended September 30, 2024 and 2023, respectively, and $6.8million and $7.7million for the nine months ended September 30, 2024 and 2023, respectively. The total obligation associated with LTIP grants of restricted units as of September 30, 2024 was $15.9million and is included in the partners' capital Limited partners-common unitholdersline item on our condensed consolidated balance sheets. As of September 30, 2024, there was $11.7million in total unrecognized compensation expense related to the non-vested LTIP restricted unit grants that are expected to vest. That expense is expected to be recognized over a weighted-average period of 1.1years.

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Supplemental Executive Retirement Plan and Directors' Deferred Compensation Plan

A summary of SERP and Directors' Deferred Compensation Plan activity is as follows:

Number of units

Weighted average fair value per unit

Intrinsic value

(in thousands)

Phantom units outstanding as of January 1, 2024

811,946

20.44

17,197

Granted

79,695

21.85

Settled (1)

(96,873)

23.89

Phantom units outstanding as of September 30, 2024

794,768

20.78

19,869

Total SERP and Directors' Deferred Compensation Plan expense was $0.7 million and $0.6 million for the three months ended September 30, 2024 and 2023, respectively, and $2.0 million and $1.8 million for the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024, the total obligation associated with the SERP and Directors' Deferred Compensation Plan was $16.5 million and is included in the partners' capital Limited partners-common unitholders line item on our condensed consolidated balance sheets.

17.COMPONENTS OF PENSION PLAN NET PERIODIC BENEFIT COSTS

Eligible employees at certain of our mining operations participate in a defined benefit plan (the "Pension Plan") that we sponsor. The Pension Plan is currently closed to new applicants and participants in the Pension Plan are no longer receiving benefit accruals for service. The benefit formula for the Pension Plan is a fixed dollar unit based on years of service. Components of the net periodic benefit credit for each of the periods presented are as follows:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Interest cost

1,289

1,294

3,817

3,885

Expected return on plan assets

(1,752)

(1,553)

(5,278)

(4,668)

Amortization of prior service cost

140

Amortization of net loss

136

169

245

513

Net periodic benefit credit (1)

(280)

(43)

(1,076)

(130)

We do not expect to make material contributions to the Pension Plan during 2024.

18.SEGMENT INFORMATION

We operate in the United States as a diversified natural resource company that generates operating and royalty income from the production and marketing of coal to major domestic and international utilities, and industrial users as well as royalty income from oil & gas mineral interests. We aggregate multiple operating segments into four reportable segments, Illinois Basin Coal Operations, Appalachia Coal Operations, Oil & Gas Royalties and Coal Royalties. We also have an "all other" category referred to as Other, Corporate and Elimination. Our two coal operations reportable segments correspond to major coal producing regions in the eastern United States with similar economic characteristics including coal quality, geology, coal marketing opportunities, mining and transportation methods and regulatory issues. The two coal operations reportable segments include seven mining complexes operating in Illinois, Indiana, Kentucky, Maryland, Pennsylvania, and West Virginia and a coal loading terminal in Indiana on the Ohio River. Our Oil & Gas Royalties reportable segment includes our oil & gas mineral interests which are located primarily in the Permian (Delaware and

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Midland), Anadarko (SCOOP/STACK) and Williston (Bakken) basins. The operations within our Oil & Gas Royalties reportable segment primarily include receiving royalties and lease bonuses for our oil & gas mineral interests. Our Coal Royalties reportable segment includes coal mineral reserves and resources owned or leased by Alliance Resource Properties, which are either (a) leased to our mining complexes or (b) near our coal mining operations but not yet leased.

The Illinois Basin Coal Operations reportable segment includes (a) the Gibson County Coal, LLC's mining complex, (b) the Warrior Coal, LLC mining complex, (c) the River View Coal, LLC mining complex and (d) the Hamilton County Coal, LLC mining complex. The segment also includes our Mt. Vernon Transfer Terminal, LLC ("Mt. Vernon") coal loading terminal in Indiana which operates on the Ohio River, Mid-America Carbonates, LLC and other support services, and our non-operating mining complexes.

The Appalachia Coal Operations reportable segment includes (a) the Mettiki mining complex, (b) the Tunnel Ridge, LLC mining complex and (c) the MC Mining complex.

The Oil & Gas Royalties reportable segment includes oil & gas mineral interests held by Alliance Minerals through its consolidated subsidiaries as well as equity interests held in AllDale III (Note 11 - Equity Investments).

The Coal Royalties reportable segment includes coal mineral reserves and resources owned or leased by Alliance Resource Properties that are (a) leased to certain of our mining complexes in both the Illinois Basin Coal Operations and Appalachia Coal Operations reportable segments or (b) located near our operations and external mining operations. Approximately 63% of the coal sold by our mines is leased from our Coal Royalties entities.

Other, Corporate and Elimination includes marketing and administrative activities, the Matrix Group, our investments in Francis, Infinitum, NGP ET IV, and Ascend (see Note 11 - Equity Investments), Wildcat Insurance, LLC which assists the ARLP Partnership with its insurance requirements, AROP Funding and Alliance Finance (both discussed in Note 8 - Long-Term Debt) and our crypto-mining activities. The eliminations included in Other, Corporate and Elimination primarily represent the intercompany coal royalty transactions described above between our Coal Royalties reportable segment and our coal operations' mines.

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Reportable segment results are presented below.

Coal Operations

Royalties

Other,

Illinois

Corporate and

Basin

Appalachia

Oil & Gas

Coal

Elimination

Consolidated

(in thousands)

Three Months Ended September 30, 2024

Revenues - Outside (1)

356,911

203,164

34,688

18,806

613,569

Revenues - Intercompany

16,647

(16,647)

Total revenues (1)

356,911

203,164

34,688

16,647

2,159

613,569

Segment Adjusted EBITDA Expense (2)

225,498

157,792

5,844

5,589

(1,006)

393,717

Segment Adjusted EBITDA (3)

114,649

37,518

28,706

11,058

342

192,273

Capital expenditures (4)

68,512

32,471

9,315

110,298

Three Months Ended September 30, 2023

Revenues - Outside (1)

371,633

215,800

36,311

12,777

636,521

Revenues - Intercompany

16,763

(16,763)

Total revenues (1)

371,633

215,800

36,311

16,763

(3,986)

636,521

Segment Adjusted EBITDA Expense (2)

213,209

131,997

3,873

6,851

(5,524)

350,406

Segment Adjusted EBITDA (3)

132,428

74,832

31,366

9,912

(881)

247,657

Capital expenditures (4)

59,833

30,304

20,202

110,339

Nine Months Ended September 30, 2024

Revenues - Outside (1)

1,109,513

589,390

108,470

51,233

1,858,616

Revenues - Intercompany

51,933

(51,933)

Total revenues (1)

1,109,513

589,390

108,470

51,943

(700)

1,858,616

Segment Adjusted EBITDA Expense (2)

674,753

412,056

15,419

18,485

(5,498)

1,115,215

Segment Adjusted EBITDA (3)

372,950

157,072

91,366

33,457

(14)

654,831

Total assets

1,029,389

534,449

806,332

313,044

348,959

3,032,173

Capital expenditures (4)

230,618

91,715

13,253

335,586

Nine Months Ended September 30, 2023

Revenues - Outside (1)

1,087,431

705,301

105,260

43,287

1,941,279

Revenues - Intercompany

48,843

(48,843)

Total revenues (1)

1,087,431

705,301

105,260

48,843

(5,556)

1,941,279

Segment Adjusted EBITDA Expense (2)

634,944

377,115

11,859

17,836

(13,618)

1,028,136

Segment Adjusted EBITDA (3)

383,987

300,955

90,461

31,007

2,560

808,970

Total assets

882,943

459,742

767,415

319,930

384,011

2,814,041

Capital expenditures (4)

179,284

94,119

400

21,553

295,356

The following is a reconciliation of Operating expenses (excluding depreciation, depletion and amortization), the most comparable GAAP financial measure, to consolidated Segment Adjusted EBITDA Expense:

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Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Operating expenses (excluding depreciation, depletion and amortization)

384,844

339,099

1,100,308

1,012,224

Litigation expense accrual

(15,250)

Outside coal purchases

8,192

11,530

27,912

15,739

Other expense (income)

681

(223)

2,245

173

Segment Adjusted EBITDA Expense

393,717

350,406

1,115,215

1,028,136

Segment Adjusted EBITDA is also used as a supplemental financial measure by our management for reasons similar to those stated in the previous explanation of EBITDA. In addition, the exclusion of corporate general and administrative expenses from consolidated Segment Adjusted EBITDA allows management to focus solely on the evaluation of segment operating profitability as it relates to our revenues and operating expenses, which are primarily controlled by our segments.

The following is a reconciliation of Net income, the most comparable GAAP financial measure, to Consolidated Segment Adjusted EBITDA:

Three Months Ended

Nine Months Ended

September 30,

2024

2023

2024

2023

(in thousands)

Net income

86,916

155,351

347,992

519,334

Noncontrolling interest

(635)

(1,652)

(3,467)

(4,660)

Net income attributable to ARLP

86,281

153,699

344,525

514,674

General and administrative

21,878

20,097

64,569

61,312

Depreciation, depletion and amortization

72,971

65,393

204,974

199,582

Interest expense, net

7,352

5,067

21,018

21,761

Change in fair value of digital assets

(332)

(8,437)

Litigation expense accrual

15,250

Income tax expense

4,123

3,401

12,932

11,641

Consolidated Segment Adjusted EBITDA

192,273

247,657

654,831

808,970

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ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Significant relationships referenced in this management's discussion and analysis of financial condition and results of operations include the following:

Summary

We are a diversified natural resources company that generates operating and royalty income from the production and marketing of coal to major domestic utilities, industrial users and international customers, as well as royalty income from oil & gas mineral interests located in strategic producing regions across the United States. Our strategy is to provide our customers with reliable, baseload fuel for electricity generation to meet their load expectations. In addition, we continue to position ourselves as a reliable energy partner for the future as we pursue opportunities that support the advancement of energy and related infrastructure particularly in the face of expanding energy demand and the electrification of the economy. We intend to pursue strategic investments that leverage our core competencies and relationships with electric utilities, industrial customers, and federal and state governments.

We are currently the largest coal producer in the eastern United States with seven operating underground mining complexes near many of the major eastern utility generating plants and on major coal hauling railroads in Illinois, Indiana, Kentucky, Maryland, Pennsylvania, and West Virginia, as well as a coal-loading terminal in Indiana. Two of our mines also have loading facilities located on the Ohio River.

In addition to our mining operations, Alliance Resource Properties owns or leases substantially all of our coal mineral resources and the majority of our coal mineral reserves in the Illinois and Appalachia Basins that are (a) leased to our internal mining complexes or (b) near our coal mining operations but not yet leased.

We currently own oil & gas mineral interests in approximately 69,000 net royalty acres in premier oil & gas producing regions of the United States, primarily in the Permian (Delaware and Midland), Anadarko (SCOOP/STACK), and Williston (Bakken) basins, providing us with diversified exposure to industry-leading operators consistent with our general strategy to grow our oil & gas mineral interest business.

We have invested in energy and infrastructure opportunities including our investments in Francis Renewable Energy, LLC ("Francis"), Infinitum Electric, Inc. ("Infinitum"), NGP Energy Transition, L.P. ("NGP ET IV"), and Ascend Elements, Inc. ("Ascend") which are in the businesses of: electric vehicle charging stations; electric motor manufacturing; private equity investments in renewable energy, the electrification of our economy or the efficient use of energy; and the manufacturing and recycling of sustainable, engineered battery materials for electric vehicles.

On February 19, 2024, we renewed our collaborative agreement with a third-party to acquire oil & gas mineral interests in the Midland and Delaware Basins (the "Acquisition Agreement") for an additional one-year term, committing up to $25.0 million. For more information about the Acquisition Agreement please read "Item 1. Financial Statements (Unaudited)-Note 3 - Acquisitions" of this Quarterly Report on Form 10-Q.

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In June 2024, we completed a private placement of $400 million in aggregate principal amount of 8.625% senior unsecured notes due 2029. A portion of the net proceeds from the offering was used to fund the redemption of our outstanding 7.5% senior notes due 2025 and the remaining proceeds were used for general corporate purposes. In connection with consummation of the notes offering, we entered into an amendment to our Credit Agreement. For more information, please read "Item 1. Financial Statements (Unaudited)-Note 8 - Long-term Debt" of this Quarterly Report on Form 10-Q.

We have four reportable segments, Illinois Basin Coal Operations, Appalachia Coal Operations, Oil & Gas Royalties and Coal Royalties. We also have an "all other" category referred to as Other, Corporate and Elimination. Our two coal operations reportable segments correspond to major coal producing regions in the eastern United States with similar economic characteristics including coal quality, geology, coal marketing opportunities, mining and transportation methods and regulatory issues. Our Oil & Gas Royalties reportable segment includes our oil & gas mineral interests. Our Coal Royalties reportable segment includes coal mineral reserves and resources owned or leased by Alliance Resource Properties.

Three Months Ended September 30, 2024 Compared to Three Months Ended September 30, 2023

Consolidated Information

Total Revenues

Total revenues for the three months ended September 30, 2024 ("2024 Quarter") decreased 3.6% to $613.6 million compared to $636.5 million for the three months ended September 30, 2023 ("2023 Quarter") primarily as a result of reduced coal sales prices and lower transportation revenues.

Total operating expenses

Total operating expenses increased to $512.5 million in the 2024 Quarter, compared to $471.1 million in the 2023 Quarter, primarily due to higher per ton costs on certain expense items discussed below.

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Net income attributable to ARLP

Net income attributable to ARLP for the 2024 Quarter was $86.3 million, or $0.66 per basic and diluted limited partner unit, compared to $153.7 million, or $1.18 per basic and diluted limited partner unit, for the 2023 Quarter as a result of lower revenues and increased total operating expenses.

Coal sales

Coal sales decreased to $532.6 million for the 2024 Quarter compared to $549.1 million for the 2023 Quarter. The decrease was attributable to lower average coal sales prices, which reduced coal sales by $11.5 million, and lower tons sold, which reduced coal sales by $5.0 million. Coal sales prices decreased by 2.1% primarily as a result of reduced export price realizations from our Appalachian segment. Coal sales volumes decreased slightly as reduced sales at our Hamilton and MC Mining operations were primarily offset by increased sales volumes from our Gibson South and Mettiki mines.

Coal - Segment Adjusted EBITDA Expense

Segment Adjusted EBITDA Expense for our coal operations increased 10.9% to $386.3 million, as a result of higher per ton costs, partially offset by lower coal sales volumes. Segment Adjusted EBITDA Expense per ton sold for our coal operations increased 11.9% to $46.11 per ton sold in the 2024 Quarter compared to $41.19 per ton in the 2023 Quarter, primarily due to reduced production, higher beginning inventory cost per ton at several mines, increased longwall move days at our Hamilton and Tunnel Ridge operations and challenging mining conditions at our Appalachian mines that lowered recoveries and increased per ton expenses as well as certain other per ton cost increases, which are discussed below by category:

Segment Adjusted EBITDA Expense increases per ton were partially offset by the following decreases:

For a definition of Segment Adjusted EBITDA Expense and related reconciliation to its comparable GAAP financial measure, please see "Item 1. Financial Statements (Unaudited) - Note 18 - Segment Information."

Depreciation, depletion and amortization

Depreciation, depletion and amortization expense increased to $73.0 million for the 2024 Quarter compared to $65.4 million for the 2023 Quarter primarily due to increased sales of higher depreciation cost tons at our Tunnel Ridge mine as a result of lower production volumes at the mine in the 2024 Quarter.

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Transportation revenues and expenses

Transportation revenues and expenses were $24.6 million and $35.0 million for 2024 and 2023 Quarters, respectively. The decrease of $10.4 million was primarily attributable to decreased average third-party transportation rates in the 2024 Quarter and decreased coal shipments for which we arrange third-party transportation. Transportation revenues are recognized when title to the coal passes to the customer and recognized in an amount equal to the corresponding transportation expenses.

Segment Adjusted EBITDA

Our 2024 Quarter Segment Adjusted EBITDA decreased $55.4 million to $192.3 million from the 2023 Quarter Segment Adjusted EBITDA of $247.7 million.

For a definition of Segment Adjusted EBITDA and related reconciliation to its comparable GAAP financial measure, please see "Item 1. Financial Statements (Unaudited) - Note 18 - Segment Information."

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Segment Information

Three Months Ended

September 30,

2024

2023

Increase (Decrease)

(in thousands)

Segment Adjusted EBITDA

Illinois Basin Coal Operations

114,649

132,428

(17,779)

(13.4)

Appalachia Coal Operations

37,518

74,832

(37,314)

(49.9)

Oil & Gas Royalties

28,706

31,366

(2,660)

(8.5)

Coal Royalties

11,058

9,912

1,146

11.6

Other, Corporate and Elimination (1)

342

(881)

1,223

138.8

Total Segment Adjusted EBITDA (2)

192,273

247,657

(55,384)

(22.4)

Coal - Tons sold

Illinois Basin Coal Operations

5,967

6,049

(82)

(1.4)

Appalachia Coal Operations

2,412

2,407

0.2

Total tons sold

8,379

8,456

(77)

(0.9)

Coal sales

Illinois Basin Coal Operations

337,816

342,744

(4,928)

(1.4)

Appalachia Coal Operations

194,831

206,379

(11,548)

(5.6)

Total coal sales

532,647

549,123

(16,476)

(3.0)

Other revenues

Illinois Basin Coal Operations

2,331

2,897

(566)

(19.5)

Appalachia Coal Operations

480

449

6.9

Oil & Gas Royalties

240

2,186

(1,946)

(89.0)

Other, Corporate and Elimination

18,806

12,777

6,029

47.2

Total other revenues

21,857

18,309

3,548

19.4

Segment Adjusted EBITDA Expense

Illinois Basin Coal Operations

225,498

213,209

12,289

5.8

Appalachia Coal Operations

157,792

131,997

25,795

19.5

Oil & Gas Royalties

5,844

3,873

1,971

50.9

Coal Royalties

5,589

6,851

(1,262)

(18.4)

Other, Corporate and Elimination (1)

(1,006)

(5,524)

4,518

81.8

Total Segment Adjusted EBITDA Expense (2)

393,717

350,406

43,311

12.4

Oil & Gas Royalties

Volume - BOE (3)

864

772

11.9

Oil & gas royalties

34,448

34,125

323

0.9

Coal Royalties

Volume - Tons sold (4)

5,109

4,993

116

2.3

Intercompany coal royalties

16,647

16,763

(116)

(0.7)

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Illinois Basin Coal Operations - Segment Adjusted EBITDA decreased 13.4% to $114.6 million in the 2024 Quarter from $132.4 million in the 2023 Quarter. The decrease of $17.8 million was primarily attributable to lower coal sales volumes and higher operating expenses. Sales volumes decreased by 1.4% compared to the 2023 Quarter due primarily to reduced domestic demand, partially offset by increased export sales volumes from our Gibson South operation. Segment Adjusted EBITDA Expense increased 5.8% to $225.5 million in the 2024 Quarter from $213.2 million in the 2023 Quarter, primarily as a result of higher operating expenses per ton, partially offset by reduced sales volumes. Segment Adjusted EBITDA Expense per ton for the 2024 Quarter increased by 7.2% compared to the 2023 Quarter due primarily to reduced production and higher beginning inventory cost per ton at our Hamilton and River View mines. Increased expenses and lower production at our Hamilton mine during the 2024 Quarter was partially attributable to increased longwall move days compared to the 2023 Quarter.

Appalachia Coal Operations - Segment Adjusted EBITDA decreased 49.9% to $37.5 million for the 2024 Quarter from $74.8 million in the 2023 Quarter. The decrease of $37.3 million was primarily attributable to lower coal sales, which decreased 5.6% to $194.8 million in the 2024 Quarter from $206.4 million in the 2023 Quarter, and higher operating expenses. The decrease in coal sales reflects lower price realizations. Average coal sales price per ton decreased by 5.8% compared to the 2023 Quarter as a result of reduced export price realizations from our Mettiki and MC Mining operations. Segment Adjusted EBITDA Expense increased 19.5% to $157.8 million in the 2024 Quarter from $132.0 million in the 2023 Quarter due to increased per ton operating expenses. Segment Adjusted EBITDA Expense per ton for the 2024 Quarter increased by 19.3% compared to the 2023 Quarter due to a longwall move at our Tunnel Ridge operation, increased subsidence related expenses and challenging mining conditions at all three operations that lowered recoveries, and increased costs related to roof control and maintenance.

Oil & Gas Royalties - Segment Adjusted EBITDA decreased 8.5% to $28.7 million in the 2024 Quarter compared to $31.4 million in the 2023 Quarter due to reduced average sales prices, which decreased by 9.8%, partially offset by increased oil & gas volumes, which rose 11.9% to 864 MBOE sold in the 2024 Quarter compared to 772 MBOE in the 2023 Quarter as a result of increased drilling and completion activities on our interests and acquisitions of additional oil & gas mineral interests.

Coal Royalties - Segment Adjusted EBITDA increased by 11.6% to $11.1 million in the 2024 Quarter compared to $9.9 million in the 2023 Quarter due to increased royalty tons sold and reduced expenses, partially offset by reduced prices.

Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023

Consolidated Information

Total Revenues

Total revenues for the nine months ended September 30, 2024 ("2024 Period") decreased 4.3% to $1.86 billion compared to $1.94 billion for the nine months ended September 30, 2023 ("2023 Period") primarily due to lower coal sales and transportation revenues, partially offset by higher oil & gas royalties and other revenues.

Total operating expenses

Total operating expenses increased to $1.48 billion in the 2024 Period, compared to $1.38 billion in the 2023 Period, primarily due to the sale of higher cost purchased coal, higher per ton costs on certain expense items discussed below and a $15.3 million litigation expense accrual in the 2024 Period relating to the settlement (which is subject to court approval) of certain litigation as described in "Part II - Item 1. Legal Proceedings" of this Quarterly Report on Form 10-Q.

Net income attributable to ARLP

Net income attributable to ARLP for the 2024 Period was $344.5 million, or $2.64 per basic and diluted limited partner unit, compared to $514.7 million, or $3.93 per basic and diluted limited partner unit, for the 2023 Period as a result of lower revenues and increased total operating expenses, partially offset by an increase in the fair value of our digital assets.

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Coal sales

Coal sales decreased to $1.61 billion for the 2024 Period compared to $1.69 billion for the 2023 Period. The decrease was attributable to lower coal sales volumes, which reduced coal sales by $60.5 million, and lower average coal sales prices, which reduced coal sales by $20.6 million. Coal sales volumes decreased by 3.6% primarily due to reduced tons sold from our River View and Tunnel Ridge mines due to reduced domestic demand, partially offset by increased export sales volumes from our Gibson South operation. Coal sales prices decreased slightly in the 2024 Period primarily due to reduced domestic pricing at our Tunnel Ridge mine, which benefited from significantly elevated pricing during the 2023 Period, and lower export price realizations from our Mettiki and MC Mining operations.

Coal - Segment Adjusted EBITDA Expense

Segment Adjusted EBITDA Expense for our coal operations increased 7.4% to $1.10 billion, as a result of higher per ton costs, partially offset by lower coal sales volumes. Segment Adjusted EBITDA Expense per ton sold for our coal operations increased 11.4% to $44.04 per ton sold in the 2024 Period compared to $39.54 per ton in the 2023 Period, primarily due to certain cost increases, which are discussed below by category:

Change in fair value of digital assets

We recorded an $8.4 million increase in the fair value of our digital assets reflecting the increase in the price of bitcoin during the 2024 Period. Effective January 1, 2024, we adopted new accounting guidance which clarifies the accounting and disclosure requirements for certain crypto assets. The new guidance requires us to measure our digital assets at fair value and include the change in net income. Please see "Item 1. Financial Statements (Unaudited) - Note 6 - Digital Assets" for more information on our digital assets.

Transportation revenues and expenses

Transportation revenues and expenses were $82.1 million and $95.7 million for 2024 and 2023 Periods, respectively. The decrease of $13.6 million was primarily attributable to decreased coal shipments for which we arrange third-party transportation, partially offset by increased average third-party transportation rates in the 2024 Period. Transportation revenues are recognized when title to the coal passes to the customer and recognized in an amount equal to the corresponding transportation expenses.

Segment Adjusted EBITDA

Our 2024 Period Segment Adjusted EBITDA decreased $154.2 million to $654.8 million from the 2023 Period Segment Adjusted EBITDA of $809.0 million.

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For a definition of Segment Adjusted EBITDA and related reconciliation to its comparable GAAP financial measure, please see "Item 1. Financial Statements (Unaudited) - Note 18 - Segment Information."

Segment Information

Nine Months Ended

September 30,

2024

2023

Increase (Decrease)

(in thousands)

Segment Adjusted EBITDA

Illinois Basin Coal Operations

372,950

383,987

(11,037)

(2.9)

Appalachia Coal Operations

157,072

300,955

(143,883)

(47.8)

Oil & Gas Royalties

91,366

90,461

905

1.0

Coal Royalties

33,457

31,007

2,450

7.9

Other, Corporate and Elimination (1)

(14)

2,560

(2,574)

(100.5)

Total Segment Adjusted EBITDA (2)

654,831

808,970

(154,139)

(19.1)

Coal - Tons sold

Illinois Basin Coal Operations

18,191

18,305

(114)

(0.6)

Appalachia Coal Operations

6,713

7,524

(811)

(10.8)

Total tons sold

24,904

25,829

(925)

(3.6)

Coal sales

Illinois Basin Coal Operations

1,040,419

1,011,467

28,952

2.9

Appalachia Coal Operations

566,766

676,771

(110,005)

(16.3)

Total coal sales

1,607,185

1,688,238

(81,053)

(4.8)

Other revenues

Illinois Basin Coal Operations

7,284

7,466

(182)

(2.4)

Appalachia Coal Operations

2,363

1,299

1,064

81.9

Oil & Gas Royalties

563

3,551

(2,988)

(84.1)

Coal Royalties

n/m

Other, Corporate and Elimination

51,233

43,287

7,946

18.4

Total other revenues

61,453

55,603

5,850

10.5

Segment Adjusted EBITDA Expense

Illinois Basin Coal Operations

674,753

634,944

39,809

6.3

Appalachia Coal Operations

412,056

377,115

34,941

9.3

Oil & Gas Royalties

15,419

11,859

3,560

30.0

Coal Royalties

18,485

17,836

649

3.6

Other, Corporate and Elimination (1)

(5,498)

(13,618)

8,120

59.6

Total Segment Adjusted EBITDA Expense (2)

1,115,215

1,028,136

87,079

8.5

Oil & Gas Royalties

Volume - BOE (3)

2,579

2,296

283

12.3

Oil & gas royalties

107,907

101,709

6,198

6.1

Coal Royalties

Volume - Tons sold (4)

15,594

15,168

426

2.8

Intercompany coal royalties

51,933

48,843

3,090

6.3

n/m Percentage change not meaningful.

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Illinois Basin Coal Operations - Segment Adjusted EBITDA decreased 2.9% to $373.0 million in the 2024 Period from $384.0 million in the 2023 Period. The decrease of $11.0 million was primarily attributable to increased operating expenses, partially offset by higher coal sales, which increased 2.9% to $1.04 billion in the 2024 Period from $1.01 billion in the 2023 Period. The increase in coal sales reflects higher coal sales price realizations of $57.19 per ton sold in the 2024 Period compared to $55.26 per ton sold in the 2023 Period due to improved domestic pricing, partially offset by a slight reduction in sales volumes. Segment Adjusted EBITDA Expense increased 6.3% to $674.8 million in the 2024 Period from $634.9 million in the 2023 Period primarily as a result of higher operating expenses per ton. Segment Adjusted EBITDA Expense per ton increased by 6.9% compared to the 2023 Period resulting from reduced production and lower recoveries at our River View and Hamilton operations.

Appalachia Coal Operations - Segment Adjusted EBITDA decreased 47.8% to $157.1 million for the 2024 Period from $301.1 million in the 2023 Period. The decrease of $144.0 million was primarily attributable to lower coal sales, which decreased 16.3% to $566.8 million in the 2024 Period from $676.8 million in the 2023 Period, and higher operating expenses. The decrease in coal sales reflects lower sales volumes and prices. Coal sales volumes decreased by 10.8% compared to the 2023 Period primarily due to reduced production at our Tunnel Ridge operation as a result of lower demand. Average coal sales prices decreased by 6.1% compared to the 2023 Period as a result of reduced domestic pricing from our Tunnel Ridge mine, which benefited from significantly elevated pricing during the 2023 Period, and lower export price realizations from our Mettiki and MC Mining operations. Segment Adjusted EBITDA Expense increased 9.3% to $412.1 million in the 2024 Period from $377.1 million in the 2023 Period due to increased operating expenses per ton, partially offset by lower sales volumes. Segment Adjusted EBITDA Expense per ton for the 2024 Period increased by 22.5% compared to the 2023 Period due to reduced production as a result of challenging mining conditions that lowered recoveries and increased costs related to labor, roof control, outside expenses, and maintenance during the 2024 Period.

Oil & Gas Royalties - Segment Adjusted EBITDA increased to $91.4 million in the 2024 Period compared to $90.5 million in the 2023 Period. Improved Segment Adjusted EBITDA in the 2024 Period was due to record oil & gas volumes, which rose to 2,579 MBOE sold in the 2024 Period, representing an increase of 12.3% compared to the 2023 Period as a result of increased drilling and completion activities on our interests and acquisitions of additional oil & gas mineral interests.

Coal Royalties - Segment Adjusted EBITDA increased to $33.5 million for the 2024 Period compared to $31.0 million for the 2023 Period. Higher average royalty rates per ton and increased royalty tons sold contributed to improved results for the 2024 Period.

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Liquidity and Capital Resources

Liquidity

We have historically satisfied our working capital requirements and funded our capital expenditures, investments, contractual obligations and debt service obligations with cash generated from operations, cash provided by the issuance of debt or equity, borrowings under credit and securitization facilities and other financing transactions. We believe that existing cash balances, future cash flows from operations and investments, borrowings under credit facilities and cash provided from the issuance of debt or equity will be sufficient to meet our working capital requirements, capital expenditures and additional investments, debt payments, contractual obligations, commitments and distribution payments. Nevertheless, our ability to satisfy our working capital requirements and additional investments, to satisfy our contractual obligations, to fund planned capital expenditures, to service our debt obligations or to pay distributions will depend upon our future operating performance and access to and cost of financing sources, which will be affected by prevailing economic conditions generally, and in both the coal and oil & gas industries specifically, as well as other financial and business factors, some of which are beyond our control. Based on our recent operating cash flow results, current cash position, anticipated future cash flows and sources of financing that we expect to have available, we anticipate being in compliance with the covenants of the Credit Agreement and expect to have sufficient liquidity to fund our operations and growth strategies. However, to the extent operating cash flow or access to and cost of financing sources are materially different than expected, future covenant compliance or liquidity may be adversely affected. Please read "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2023.

Accounts Receivable Securitization

In January 2024, we extended the term of the accounts receivable securitization facility (the "Securitization Facility") to January 2025 and increased the borrowing availability under the facility to $90.0 million. For additional information on the Securitization Facility, please see "Item 1. Financial Statements (Unaudited) - Note 8 - Long-Term Debt."

February 2024 Equipment Financing

On February 28, 2024, Alliance Coal entered into an equipment financing arrangement accounted for as debt, wherein Alliance Coal received $54.6 million in exchange for conveying its interest in certain equipment owned indirectly by Alliance Coal and entering into a master lease agreement for that equipment (the "February 2024 Equipment Financing"). For additional information on the February 2024 Equipment Financing, please see "Item 1. Financial Statements (Unaudited) - Note 8 - Long-Term Debt."

8.625% Senior Notes due 2029

On June 12, 2024, the Intermediate Partnership and Alliance Finance (as co-issuer) issued an aggregate principal amount of $400 million of senior unsecured notes due 2029 in a private placement to qualified institutional buyers. For additional information on the 8.625% Senior Notes due 2029, please see "Item 1. Financial Statements (Unaudited) - Note 8 - Long-Term Debt."

7.5% Senior Notes due 2025

In June 2024, we redeemed the entire outstanding balance of $284.6 million of our 7.5% Senior Notes due 2025.

Unit Repurchase Program

In May 2018, the Board of Directors approved the establishment of a unit repurchase program authorizing us to repurchase up to $100 million of ARLP common units. In January 2023, the board of directors of MGP authorized a $93.5 million increase to the unit repurchase program authorizing us to be able to repurchase up to a total of $100 million of ARLP common units from that date. The program has no time limit and we may repurchase units from time to time in the open market or in other privately negotiated transactions. The unit repurchase program authorization does not obligate us to repurchase any dollar amount or number of units. No units were repurchased during the nine months ended September 30, 2024. The timing of any future unit repurchases and the ultimate number of units to be purchased will depend on several factors, including business and market conditions, our future financial performance, and other capital priorities.

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Please read "Part II - Item 2. Unregistered Sales of Equity Securities and Use of Proceeds" of this Quarterly Report on Form 10-Q for more information on the unit repurchase program.

Shelf Registration Statement

We currently have an effective universal shelf Registration Statement on Form S-3 that provides for the registration and sale of an unspecified amount of our equity or debt securities. We may over time, and subject to market conditions, in one or more offerings, offer and sell any of the securities described in the prospectus.

Cash Flows

Cash provided by operating activities was $634.7 million for the 2024 Period compared to $730.3 million for the 2023 Period. The decrease in cash provided by operating activities was primarily due to the decrease in net income adjusted for non-cash items and unfavorable working capital changes primarily related to accounts payable. These decreases were partially offset by favorable working capital changes primarily related to trade receivables, inventories, and miscellaneous other changes compared to the 2023 Period.

Net cash used in investing activities was $337.4 million for the 2024 Period compared to $439.4 million for the 2023 Period. The decrease in cash used in investing activities was primarily due to acquisitions of oil & gas reserves including the JC Resources Acquisition and purchase of investments in the 2023 Period and change in accounts payable and accrued liabilities. These decreases were partially offset by increased capital expenditures during the 2024 Period.

Net cash used in financing activities was $161.7 million for the 2024 Period compared to $389.7 million for the 2023 Period. The decrease in cash used in financing activities was primarily attributable to the issuance of our 8.625% Senior Notes due 2029, borrowings under our February 2024 Equipment Financing and the purchase of units under our repurchase program in the 2023 Period. These decreases were partially offset by the redemption of our remaining 7.5% Senior Notes due 2025.

Cash Requirements

Management anticipates having sufficient cash flow to meet 2024 cash requirements, including capital expenditures, scheduled payments on long-term debt, lease obligations, asset retirement obligation costs and workers' compensation and pneumoconiosis costs, with our September 30, 2024 cash and cash equivalents of $195.4 million, cash flows from operations, or borrowings under our revolving credit facility and securitization facility, if necessary. We currently project average estimated annual maintenance capital expenditures over the next five years of approximately $7.76 per ton produced. Our anticipated total capital expenditures, including maintenance capital expenditures, for 2024 are estimated in a range of $420.0 million to $460.0 million. We will continue to have significant cash requirements over the long term, which may require us to incur debt or seek additional equity capital. The availability and cost of additional capital will depend upon prevailing market conditions, the market price of our common units and several other factors over which we have limited control, as well as our financial condition and results of operations.

Debt Obligations

See "Item 1. Financial Statements (Unaudited)-Note 8 - Long-Term Debt" of this Quarterly Report on Form 10-Q for a discussion of our long-term debt obligations.

We also have an agreement with a bank to provide additional letters of credit in the amount of $5.0 million to maintain surety bonds to secure certain asset retirement obligations and our obligations for workers' compensation benefits. On September 30, 2024, we had $5.0 million in letters of credit outstanding under this agreement.

Related-Party Transactions

We have related-party transactions and activities with Mr. Craft, MGP and their respective affiliates as well as other related parties. These related-party transactions and activities relate principally to (1) coal mineral leases with The Joseph W. Craft III Foundation and The Kathleen S. Craft Foundation, (2) the use of aircraft, and (3) the purchase of oil & gas mineral interests from JC Resources LP, an entity owned by Mr. Craft. We also have related-party transactions with (a) WKY CoalPlay, LLC, a company owned by entities related to Mr. Craft, regarding three mineral leases, and (b) with

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entities in which we hold equity investments. For more information regarding our investments, please read "Item 1. Financial Statements (Unaudited)-Note 11 -Equity Investments" of this Quarterly Report on Form 10-Q. Please read our Annual Report on Form 10-K for the year ended December 31, 2023, "Item 8. Financial Statements and Supplementary Data- Note 3 -Acquisitions and Note 20 -Related-Party Transactions" for additional information concerning the JC Resources Acquisition and our related-party transactions.

New Accounting Standards

See "Item 1. Financial Statements (Unaudited) - Note 2. New Accounting Standards" of this Quarterly Report on Form 10-Q for a discussion of new accounting standards.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Commodity Price Risk

We have significant long-term coal sales contracts. Most of the long-term sales contracts are subject to price adjustment provisions, which periodically permit an increase or decrease in the contract price, typically to reflect changes in specified indices or changes in production costs resulting from regulatory changes, or both.

Our results of operations are highly dependent upon the prices we receive for our coal, oil and natural gas. Regarding coal, the short-term sales contracts favored by some of our coal customers leave us more exposed to risks of declining coal price periods. Also, a significant decline in oil & gas prices would have a significant impact on our oil & gas royalty revenues.

We have exposure to coal and oil & gas sales prices and price risk for supplies that are used directly or indirectly in the normal course of coal and oil & gas production such as steel, electricity and other supplies. We manage our risk for these items through strategic sourcing contracts for normal quantities required by our operations. Historically, we have not utilized any commodity price-hedges or other derivatives related to either our sales price or supply cost risks but may do so in the future.

Credit Risk

Most of our coal is sold to U.S. electric utilities or into the international markets through brokered transactions. Therefore, our credit risk is primarily with domestic electric power generators and reputable global brokerage firms. Our policy is to independently evaluate each customer's creditworthiness prior to entering into transactions and to constantly monitor outstanding accounts receivable. When deemed appropriate by our credit management department, we will take steps to reduce our credit exposure to customers that do not meet our credit standards or whose credit has deteriorated. These steps may include obtaining letters of credit or cash collateral, requiring prepayments for shipments or establishing customer trust accounts held for our benefit in the event of a failure to pay. Such credit risks from customers may impact the borrowing capacity of our Securitization Facility. See "Item 1. Financial Statements (Unaudited)-Note 8 - Long-Term Debt" of this Quarterly Report on Form 10-Q for more information on our Securitization Facility.

Exchange Rate Risk

Almost all our transactions are denominated in United States dollars, and as a result, we do not have material exposure to currency exchange-rate risks. However, because coal is sold internationally in United States dollars, general economic conditions in foreign markets and changes in foreign currency exchange rates may provide our foreign competitors with a competitive advantage. If our competitors' currencies decline against the United States dollar or against foreign purchasers' local currencies, those competitors may be able to offer lower prices for coal to these purchasers. Furthermore, if the currencies of overseas purchasers were to significantly decline in value in comparison to the United States dollar, those purchasers may seek decreased prices for the coal we sell to them. Consequently, currency fluctuations could adversely affect the competitiveness of our coal in international markets.

Interest Rate Risk

Borrowings under the Revolving Credit Facility and Securitization Facility are at variable rates and, as a result, we have interest rate exposure on any amounts drawn under these facilities. Historically, our earnings have not been materially affected by changes in interest rates and we have not utilized interest rate derivative instruments related to our

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outstanding debt. We did not have an outstanding balance under either the Revolving Credit Facility or the Securitization Facility at September 30, 2024.

There were no other changes in our quantitative and qualitative disclosures about market risk as set forth in our Annual Report on Form 10-K for the year ended December 31, 2023.

ITEM 4.CONTROLS AND PROCEDURES

We maintain controls and procedures designed to provide reasonable assurance that information required to be disclosed in the reports we file with the Securities and Exchange Commission ("SEC") is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. As required by Rule 13a-15(b) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), we have evaluated, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) of the Exchange Act) as of September 30, 2024. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that these controls and procedures are effective as of September 30, 2024.

During the quarterly period ended September 30, 2024, there have not been any changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) identified in connection with our evaluation that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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FORWARD-LOOKING STATEMENTS

Certain statements and information in this Quarterly Report on Form 10-Q, and certain oral statements made from time to time by our representatives, constitute "forward-looking statements." These statements are based on our beliefs as well as assumptions made by, and information currently available to, us. When used in this document, the words "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "foresee," "may," "outlook," "plan," "project," "potential," "should," "will," "would," and similar expressions identify forward-looking statements. Without limiting the foregoing, all statements relating to our future outlook, anticipated capital expenditures, future cash flows and borrowings, and sources of funding are forward-looking statements. These forward-looking statements are based on our current expectations and beliefs concerning future developments and reflect our current views with respect to future events and are subject to numerous assumptions that we believe are reasonable, but are open to a wide range of uncertainties and business risks, and actual results could differ materially from those discussed in these statements. Among the factors that could cause actual results to differ from those in the forward-looking statements are:

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If one or more of these or other risks or uncertainties materialize, or should our underlying assumptions prove incorrect, our actual results could differ materially from those described in any forward-looking statement. When considering forward-looking statements, you should also keep in mind our risk factors and legal proceedings. Known material factors that could cause our actual results to differ from those in the forward-looking statements are described in "Item 1. Legal Proceedings" and "Item 1A. Risk Factors" below. We disclaim any obligation to update or revise any forward-looking statements or to announce publicly the result of any revisions to any of the forward-looking statements to reflect future events or developments unless required by law.

You should consider the information above when reading or considering any forward-looking statements contained in:

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PART II

OTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS

Litigation was initiated in November 2019 in the U.S. District Court for the Western District of Kentucky (Branson v. Webster County Coal, LLC et al.) against certain of our subsidiaries in which the plaintiffs allege violations of the Fair Labor Standards Act and state law due to alleged failure to compensate for time "donning" and "doffing" equipment and to account for certain bonuses in the calculation of overtime rates and pay. A similar lawsuit was initiated in March 2020 in the U.S. District Court for the Eastern District of Kentucky (Brewer v. Alliance Coal, LLC, et al.). Subsequently, four additional lawsuits making similar allegations were initiated against certain of our subsidiaries: filed March 4, 2021 in the Circuit Court for Hopkins County, Kentucky (Johnson v. Hopkins County Coal, LLC, et al.); filed April 6, 2021 in the U.S. District Court for the Northern District of West Virginia (Rettig v. Mettiki Coal WV, LLC, et al.); filed April 9, 2021 in the U.S. District Court for the Southern District of Illinois (Cates v. Hamilton County Coal, LLC, et al.); and filed April 13, 2021 in the U.S. District Court for the Southern District of Indiana (Prater v. Gibson County Coal, LLC, et al.). The plaintiffs in these cases sought class and collective action certification, which we opposed. The plaintiffs sought to recover alleged compensatory, liquidated and/or exemplary damages for the alleged underpayment, and costs and fees that potentially may be recoverable under applicable law. In April 2024, we entered into a settlement agreement with the plaintiffs pursuant to which we agreed to settle all six cases for $15.3 million. The settlement is subject to court approval.

ITEM 1A.RISK FACTORS

In addition to the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the risk factors discussed in Part I - Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2023, which could materially affect our business, financial condition or future results. The risks described in these reports are not our only risks. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial based on current knowledge and factual circumstances, if such knowledge or facts change, also may materially adversely affect our business, financial condition and/or operating results in the future.

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On May 31, 2018, ARLP announced that the Board of Directors approved the establishment of a unit repurchase program authorizing ARLP to repurchase up to $100 million of its outstanding limited partner common units. In January 2023, the board of directors authorized a $93.5 million increase to the unit repurchase program authorizing us to be able to repurchase up to a total of $100.0 million of ARLP common units from that date. The unit repurchase program is intended to enhance ARLP's ability to achieve its goal of creating long-term value for its unitholders and provides another means, along with quarterly cash distributions, of returning cash to unitholders. The program has no time limit and ARLP may repurchase units from time to time in the open market or in other privately negotiated transactions. The unit repurchase program authorization does not obligate ARLP to repurchase any dollar amount or number of units and repurchases may be commenced or suspended from time to time without prior notice.

During the three months ended September 30, 2024, we did not repurchase and retire any units. Since the inception of the unit repurchase program, we have repurchased and retired 6,390,446 units at an average unit price of $17.67 for an aggregate purchase price of $112.9 million.

ITEM 3.DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.MINE SAFETY DISCLOSURES

Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95.1 to this Quarterly Report on Form 10-Q.

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ITEM 5.OTHER INFORMATION

During the three months ended September 30, 2024, no directoror officer adoptedor terminated(i) any contract, instructions or written plan for the purchase or sale of securities of the Partnership intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) and/or (ii) any written arrangement for the purchase or sale of securities of the Partnership that meets the definition of a non-Rule 10b5-1 trading arrangement as defined in Item 408(c).

ITEM 6.EXHIBITS

Incorporated by Reference

ExhibitNumber

Exhibit Description

Form

SECFile No. andFilm No.

Exhibit

Filing Date

FiledHerewith*

3.1

Amended and Restated Certificate of Limited Partnership of Alliance Resource Partners, L.P.

8-K

000-26823

17990766

3.6

07/28/2017

3.2

Fourth Amended and RestatedAgreementof Limited Partnership of Alliance Resource Partners, L.P.

8-K

000-26823

17990766

3.2

07/28/2017

3.3

Amendment No. 1 to Fourth Amended and Restated Agreement of Limited Partnership of Alliance Resource Partners, L.P.

10-K

000-26823

18634634

3.9

02/23/2018

3.4

Amendment No. 2 to Fourth Amended and Restated Agreement of Limited Partnership of Alliance Resource Partners, L.P.

8-K

000-26823

18883834

3.3

06/06/2018

3.5

Amendment No. 3 to Fourth Amended and Restated Agreement of Limited Partnership of Alliance Resource Partners, L.P.

8-K

000-26823

18883834

3.4

06/06/2018

3.6

Certificate of Limited Partnership of Alliance Resource Operating Partners, L.P.

S-1/A

333-78845

99669102

3.8

07/23/1999

3.7

First Amendment to Certificate of Limited Partnership of Alliance Resource Operating Partners, L.P.

10-Q

000-26823

241184062

3.7

08/07/2024

3.8

SecondAmendment to Certificate of Limited Partnership of Alliance Resource Operating Partners, L.P.

10-Q

000-26823

241184062

3.8

08/07/2024

3.9

Third Amendment to Certificate of Limited Partnership of Alliance Resource Operating Partners, L.P.

10-Q

000-26823

241184062

3.9

08/07/2024

3.10

Amended and Restated Agreement of Limited Partnership of Alliance Resource Operating Partners, L.P.

10-K

000-26823

583595

3.2

03/29/2000

3.11

Amendment No. 1 to Amended and Restated Agreement of Limited Partnership of Alliance Resource Operating Partners, L.P.

8-K

000-26823

18883834

3.5

06/06/2018

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Incorporated by Reference

ExhibitNumber

Exhibit Description

Form

SECFile No. andFilm No.

Exhibit

Filing Date

FiledHerewith*

3.12

Certificate of Formation of Alliance Resource Management GP, LLC

S-1/A

333-78845

99669102

3.7

07/23/1999

3.13

Third Amended and Restated Operating Agreement of Alliance Resource Management GP, LLC

8-K

000-26823

18883834

3.7

06/06/2018

3.14

Certificate of Formation of MGP II, LLC

8-K

000-26823

17990766

3.5

07/28/2017

3.15

Amended and Restated Operating Agreement of MGP II, LLC

8-K

000-26823

17990766

3.4

07/28/2017

4.1

Indenture, dated as of June 12, 2024, by and among Alliance Resource Operating Partners, L.P. and Alliance Resource Finance Corporation, as issuers, Alliance Resource Partners, L.P., as parent, the subsidiary guarantors party thereto and Computershare Trust Company, N.A., as trustee.

8-K

000-26823

241038800

4.1

06/12/2024

4.2

Form of 8.625% Senior Note due 2029 (included in Exhibit 4.1).

8-K

000-26823

241038800

4.1

06/12/2024

10.1

Amendment No. 1, dated June 12, 2024, to the Credit Agreement, dated as of January 13, 2023, among Alliance Coal, LLC, as borrower, Alliance Resource Operating Partners, L.P., Alliance Resource Partners, L.P., UC Coal, LLC, UC Mining, LLC, UC Processing, LLC and MGP II, LLC as additional Alliance entities and the initial lenders, initial issuing banks and swingline bank named therein, PNC Bank, National Association as administrative agent and collateral agent and PNC Capital Markets LLC, BOKF, NA DBA Bank of Oklahoma, Fifth Third Bank, National Association, Old National Bank and Truist Securities, Inc. as joint lead arrangers and joint bookrunners and the other institutions named therein as documentation agents, arrangers and joint bookrunners and the other institutions named therein as documentation agents.

8-K

000-26823

241038800

10.1

06/12/2024

31.1

Certification of Joseph W. Craft III, President and Chief Executive Officer of Alliance Resource Management GP, LLC, the general partner of Alliance Resource Partners, L.P., dated November 7, 2024, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

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Incorporated by Reference

ExhibitNumber

Exhibit Description

Form

SECFile No. andFilm No.

Exhibit

Filing Date

FiledHerewith*

31.2

Certification of Cary P. Marshall, Senior Vice President and Chief Financial Officer of Alliance Resource Management GP, LLC, the general partner of Alliance Resource Partners, L.P., dated November 7, 2024, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certification of Joseph W. Craft III, President and Chief Executive Officer of Alliance Resource Management GP, LLC, the general partner of Alliance Resource Partners, L.P., dated,November 7, 2024, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2

95.1

Federal Mine Safety and Health Act Information

101

Interactive Data File (Form 10-Q for the quarter ended September 30, 2024 filed in Inline XBRL).

104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

* Or furnished, in the case of Exhibits 32.1 and 32.2.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized, in Tulsa, Oklahoma, on November 7, 2024.

ALLIANCE RESOURCE PARTNERS, L.P.

By:

Alliance Resource Management GP, LLC

its general partner

/s/ Joseph W. Craft, III

Joseph W. Craft, III

Chairman, President and Chief Executive

Officer, duly authorized to sign on behalfof the registrant.

/s/ Megan J. Cordle

Megan J. Cordle

Vice President, Controller and

Chief Accounting Officer

Disclaimer

ARLP - Alliance Resource Partners LP published this content on November 07, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on November 08, 2024 at 01:23:55.002.