Alpha Natural Resources Announces Results for Third Quarter 2009

- Merger with Foundation Coal Holdings, Inc. successfully completed on July
31, 2009

ABINGDON, Va., Nov. 3 /PRNewswire-FirstCall/ -- Alpha Natural Resources, Inc.
(NYSE: ANR), a leading U.S. coal producer, reported a third quarter net loss
of $19.5 million or $0.19 per diluted share, which includes the impact of
various merger-related expenses, compared to net income of $67.4 million or
$0.93 per diluted share last year. The third quarter 2009 loss from
continuing operations was $20.0 million or $0.19 per diluted share compared to
income from continuing operations of $66.1 million or $0.91 per diluted share
in the third quarter of 2008. Excluding merger-related expenses and other
unusual items, third quarter 2009 adjusted income from continuing operations
was $49.4 million, or $0.47 per diluted share.

Earnings before interest, taxes, depreciation, depletion and amortization
(EBITDA) from continuing operations for the quarter just ended totaled $112.6
million, compared to $122.3 million in the year ago period. Excluding
merger-related expenses and other unusual items, third quarter 2009 adjusted
EBITDA from continuing operations was $160.7 million.

For the quarter, the Company incurred merger-related expenses and other
unusual items, including $42.4 million of pre-tax merger-related expenses, a
net $58.0 million pre-tax expense for amortization of acquired coal supply
agreements, a $23.5 million pre-tax non-cash charge arising from the
termination of hedge accounting for an interest rate swap, a $5.6 million
pre-tax expense for loss on the early extinguishment of debt, and a $22.2
million benefit arising from the reversal of a deferred income tax asset
valuation allowance. The following table compares the Company's third quarter
2009 results from continuing operations as reported with the Company's results
from continuing operations excluding these merger-related expenses and other
unusual items.

(millions, except per-share amounts)

As As
Reported Adjusted*
Income (loss) from continuing operations ($20.0) $49.4

Net income (loss) from continuing operations per
diluted share ($0.19) $0.47

EBITDA from continuing operations $112.6 $160.7

Reported financial results for the third quarter of 2009 include three months
of results from Alpha's pre-merger operations (Alpha stand-alone) and two
months of results from the acquired Foundation operations. As a result of the
timing of the closing of the Alpha/Foundation merger on July 31, 2009, third
quarter 2009 results will not be comparable to historical or future periods.

Quarterly Financial & Operating Highlights
(millions, except per-share and per-ton amounts)

Q3 Q3 Q2
2009 2008 2009
Coal revenues $662.4 $601.5 $333.9
Income (loss) from continuing operations ($20.0) $66.1 $16.7
Net income (loss) ($19.5) $67.4 $15.4
Net income (loss) per diluted share ($0.19) $0.93 $0.22
Adjusted income from continuing operations* $49.4 $48.5 $19.8
Adjusted income from continuing operations per
diluted share* $0.47 $0.67 $0.28
EBITDA from continuing operations* $112.6 $122.3 $68.2
Adjusted EBITDA from continuing operations* $160.7 $110.9 $72.3
Tons of coal sold 16.5 6.9 4.3
Coal margin per ton $11.72 $23.08 $15.53

All quarters have been adjusted for discontinued operations and the third
quarter 2008 amounts have been adjusted for the adoption of ASC 470-20 on
January 1, 2009. Coal revenues and coal margin per ton for all periods
have been adjusted to reflect a change in the income statement
presentation of gains and losses on derivatives.

*These are non-GAAP financial measures provided as additional relevant
information about the Company's performance. Management believes that
adjusted EBITDA from continuing operations, adjusted income from
continuing operations and adjusted income from continuing operations per
share are more representative of the Company's performance trends and
enhance comparability to peer companies, and are, therefore, useful to
investors. A reconciliation of adjusted income (loss) from continuing
operations to income from continuing operations, and a reconciliation of
both EBITDA from continuing operations and adjusted EBITDA from continuing
operations to income from continuing operations are included in tables
accompanying the financial schedules.

"Alpha's strong third quarter 2009 performance is particularly noteworthy in
light of the continued weakness in the domestic thermal coal market and the
fact that we closed our merger with Foundation Coal at the end of July,
creating the third largest U.S. coal company by most measurements," said Kevin
Crutchfield, Alpha's Chief Executive Officer. "The ability to deliver strong
quarterly results, exclusive of merger-related and other unusual items, is a
testament to the hard work and dedication of our entire workforce which is now
6,200 strong. I am pleased to report that Alpha's new and significantly
increased scale has not altered our focus on safety. Both organizations were
on pace for record safety performance prior to the merger, and the favorable
trend continues. During the quarter Eagle Butte celebrated two years without
a lost time accident representing more than one million man hours, and Belle
Ayr recently celebrated one year without a lost time accident representing
approximately 800,000 man hours."

"We will continue to pursue a pragmatic and restrained approach to production
in the current market environment in which decreased coal-fired generation and
high utility inventories have significantly reduced demand for thermal coal.
However," Mr. Crutchfield continued, "in the last few months interest in
metallurgical coal appears to have picked up markedly, discussions with
metallurgical coal customers have increased, and order flow is beginning to
result from this heightened activity. Accordingly, we are increasing our
guidance for metallurgical coal shipments in 2010 to a range of 10 to 12
million tons, a one million ton increase from the previous guidance range of 9
to 11 million tons. As the largest U.S. supplier of metallurgical coal, Alpha
remains highly leveraged to this market, and with 54% of our metallurgical
coal uncommitted for 2010, we believe current market developments position
Alpha favorably to capitalize on this opportunity.

"Finally, I would like to thank everyone that contributed to the success of
our merger with Foundation Coal early in the third quarter. We were able to
close the transaction in just two and a half months, while at the same time
putting together a detailed plan for integration which will serve as a model
for Alpha as we execute our growth strategy in the future. Since closing, we
succeeded in our goal of finalizing the integration decision making process by
the end of September; the management team is in place; and, we are positioned
to execute as a unified company from this point forward."

Financial Performance - Third Quarter

-- Total revenues in the third quarter were $729.2 million compared to
$688.4 million for Alpha stand-alone in the same period last year,
and coal revenues were $662.4 million compared to $601.5 million
for Alpha stand-alone in the third quarter of 2008. Coal revenues
in the third quarter 2009, while higher than the year ago period due
to the inclusion of former Foundation operations which added $277.9
million, were negatively impacted by lower thermal coal shipment
levels in all regions from the operations of both organizations
given reduced demand. Third quarter revenues also reflect lower
metallurgical coal shipments, which were 2.1 million tons on a
combined company basis in the third quarter 2009 compared with 3.0
million tons for Alpha stand-alone in the year ago period, and lower
average realizations per ton from the sale of metallurgical coal.

-- Total costs and expenses for the most recent quarter were $748.1
million versus $606.7 million for Alpha stand-alone in the year ago
period. Cost of coal sales of $469.5 million compares favorably to
$441.1 million for Alpha stand-alone in the third quarter of 2008,
reflecting lower production levels across the operations of both
predecessor companies, effective cost controls, increased
operational efficiencies and the inclusion of Foundation Coal
operations which resulted in an improved coal margin that increased
from 26.7 percent for Alpha stand-alone last year to 29.1 percent in
the third quarter of 2009.

Total costs and expenses in the third quarter include $42.4 million
of pre-tax merger-related expenses, including direct transaction
costs, consulting and professional services fees, stock-based
compensation charges, integration-related expenses, severance and
relocation-related costs. These merger-related expenses are
primarily reflected in higher selling, general and administrative
expense (SG&A), which was $83.5 million in the most recent quarter,
versus $20.9 million for Alpha stand-alone in the third quarter of
2008. In addition, a net $58.0 million pre-tax expense for
amortization of acquired coal supply agreements was recorded in the
third quarter due to acquisition accounting rules which required the
Company to record Foundation's coal contracts at fair value as of
the acquisition date. The resulting net intangible asset of $494.3
million as of July 31, 2009 will be amortized and expensed as the
contracted tons of coal are shipped. This non-cash amortization will
continue for several quarters, with the impact diminishing over time
as the underlying coal supply agreements are fulfilled.

-- Depreciation, depletion and amortization (DD&A) of $78.2 million
during the quarter compares with $40.2 million for Alpha stand-alone
in the year ago period, reflecting the combination of the Alpha and
Foundation assets, including property, plant and equipment and
mineral rights, as well as some acquisition accounting impacts
spread over the life of the various assets.

-- Contained within other revenues and other expenses was a total
unrealized gain of $3.4 million from changes in the fair value of
derivative instruments in the most recent quarter compared with an
unrealized loss of $34.3 million in last year's third quarter.

-- Other non-operating expense increased to $47.3 million in the most
recent quarter, up from $6.6 million for Alpha stand-alone in the
third quarter last year. Higher other non-operating expense was
primarily driven by the combined company's pre-tax interest expense
of $42.8 million, including a $23.5 million pre-tax non-cash charge
arising from the termination of hedge accounting for an interest
rate swap, compared to pre-tax interest expense of $9.7 million for
Alpha stand-alone in the third quarter of 2008. In addition, Alpha
incurred a $5.6 million pre-tax expense for loss on the early
extinguishment of debt associated with the write-off of deferred
debt issuance costs triggered by the repayment of the Alpha stand-
alone Term Loan done in conjunction with the merger.

-- The income tax benefit from continuing operations for the quarter
just ended was $46.2 million, versus income tax expense of $9.1
million for Alpha stand-alone in the third quarter last year. Third
quarter 2009 income tax benefit from continuing operations includes
an estimated $38.1 million benefit related to the tax impact of the
various merger-related and unusual charges described above, as well
as a $22.2 million benefit arising from the reversal of a deferred
income tax asset valuation allowance. The reversal of the valuation
allowance was triggered by Alpha moving from a net deferred tax
asset position to a net deferred tax liability position on its
consolidated balance sheet as a result of the acquisition accounting
for the merger.

Sales, Average Realizations and Cost of Coal Sales Per Ton - Third Quarter

-- For the quarter just ended, the combined company sold 16.5 million
tons
of coal, including 8.6 million tons of Powder River Basin (PRB) coal,
5.8 million tons of Eastern steam coal, and 2.1 million tons of
Eastern
metallurgical coal. The former Foundation operations shipped a total
of
11.7 million tons in the two months post-merger. On a stand-alone
basis, Alpha sold 4.0 million tons and 3.0 million tons of Eastern
steam
coal and Eastern metallurgical coal, respectively, in the third
quarter
of 2008.
-- The Company's average per ton realization in the most recent quarter
was
$40.25, versus $86.58 in the year ago period, primarily reflecting the
influence in the third quarter 2009 of two months of PRB sales at an
average per ton realization of $10.39. The average per ton
realization
for Eastern steam coal sold during the most recent quarter was $64.43
compared to $52.10 in the third quarter of 2008, and the average per
ton
realization for Eastern metallurgical coal sold during the third
quarter
was $96.92 versus $132.35 last year.

-- Cost of coal sales per ton in the third quarter averaged $8.08 for PRB
mines and $50.62 for Eastern mines (including brokered coal). The
year-over-year decrease in the cost of coal sales for Eastern mines
mainly reflects the inclusion of results from former Foundation's
relatively lower cost longwall mines in the Pittsburgh #8 seam for the
months of August and September. In addition, production and brokered
coal curtailments have been primarily from higher cost mines and
purchased coal sources.

Year-to-Date Results

-- For the first nine months of this year, Alpha reported total revenues
of
$1.6 billion, including $1.4 billion in coal revenues. For the first
nine months of 2008, total revenues were $1.9 billion and coal
revenues
were $1.6 billion. Lower shipments of both metallurgical and thermal
coal were the primary drivers of the decline in coal revenues,
somewhat
offset by the addition of two months of revenues from the former
Foundation operations, which added $0.3 billion.

-- Coal sales volumes for the first nine months of 2009 totaled 25.9
million tons, including 11.7 million tons from the former Foundation
operations during the months of August and September, compared with
20.7
million tons in the first three quarters of 2008 for Alpha
stand-alone.
Metallurgical coal shipments were 5.6 million tons year-to-date
through
September, down 38 percent compared to the year-to-date 2008 period,
despite the inclusion of former Foundation's metallurgical coal sales
of
0.1 million tons for two months. The unit cost of coal sales for the
first nine months of 2009 was $40.09 per ton. Alpha's coal margin for
the first three quarters of 2009 was $14.80 per ton or 27.0 percent.

Liquidity and Capital Resources

Cash provided by operations (including discontinued operations) for the
quarter ended September 30, 2009 was $104.5 million, compared with $156.4
million in the third quarter of 2008. Cash from operations (including
discontinued operations) through the first three quarters of 2009 was $162.1
million, compared with $335.8 million for the first nine months of 2008.

Through the third quarter of 2009 Alpha continued to limit capital
expenditures to match reduced production levels in light of reduced coal
demand in the current market environment. Capital expenditures (including
discontinued operations) for the quarter and nine months ended September 30,
2009 were $56.7 million and $102.8 million, respectively, versus $39.4 million
and $113.6 million in the third quarter and first nine months of 2008.

The Company had available liquidity of $954.5 million as of September 30,
2009, including cash and cash equivalents of $481.6 million and $472.9 million
available under the Company's revolving credit facility. Total debt
outstanding at September 30, 2009 of $791.9 million includes the addition of
$590.7 million of debt from the Foundation merger, partially offset by the
repayment of Alpha's $233.1 million Term Loan and a quarterly $8.4 million
principal repayment on former Foundation's Term Loan, and compares with total
debt of $451.3 million at December 31, 2008.

Market Overview

The third quarter of 2009 saw continued weakness in the thermal coal market in
the United States where reduced industrial demand, milder-than-normal weather
in coal-reliant regions, and low-cost natural gas combined to significantly
reduce coal consumption. For the first nine months of 2009, coal-fired
electric generation was down approximately 10 percent compared to the same
period in 2008, while overall electricity generation was down an estimated
four percent. In this recession-driven market environment, utility
inventories are near record highs, ending September 2009 above 190 million
tons nationwide. However, the outlook is improving, and Alpha believes the
following factors lead to the conclusion that the thermal coal market in the
United States is likely to strengthen by the second half of 2010:

-- Utility inventory levels have stabilized from August to September;
-- Forward natural gas prices are now $5-$6/MCF, a level that indicates
coal-to-gas switching should reverse, bringing an estimated 30-40
million tons of coal demand back to the market next year;
-- Economic recovery now appears likely, with most analysts forecasting
U.S. GDP growth of 2-3 percent in 2010 which would increase industrial
demand for electricity;
-- Worldwide economic recovery, a weak dollar and global seaborne coal
trade dynamics suggest that U.S. coal exports are likely to increase
in
2010; and

-- Several analysts now forecast that domestic coal consumption may
increase 5-7 percent in 2010.

The market for metallurgical coal is currently strengthening around the world.
Three major factors account for the improving market for metallurgical coal.
They are Chinese demand, global economic improvements and supply constraints.

Growing Asian demand for metallurgical coal, primarily from China, is causing
a transformational change in the seaborne metallurgical coal market. China is
on pace to import more than 30 million tons of coking coal in 2009,
representing greater than 10 percent of global seaborne coking coal, and the
trend appears likely to continue. Chinese demand for imported coking coal
will primarily be satisfied with Australian exports, reducing the seaborne
supply of Australian metallurgical coal available in the Atlantic basin.

As the world recovers from the recent recession, analysts forecast increasing
steel production in 2010 worldwide. Steel makers in the United States
responded swiftly to the economic downturn, reducing capacity utilization and
driving inventories to 26-years lows, despite anemic demand. Though
relatively slow to recover, capacity utilization in the U.S. has been steadily
increasing recently and crested the 60% level in October after averaging below
45% in the first half of 2009, and capacity utilization is expected to rise
going forward, which would drive the demand for metallurgical coal.

As demand from China and around the world strengthens, met coal supplies
remain constrained. The global supply of coking coal is limited, and
significant new mine developments are years away from completion and hampered
by lack of available rail and port infrastructure. Australia is currently
near its maximum export capacity, as evidenced by queues of approximately 70
vessels awaiting loadings at Dalrymple Bay. The Eastern United States is one
of the only regions in the world that has spare capacity and can increase
coking coal production and exportation to meet the anticipated growth in
global demand.

As a result of the factors outlined above, customers have recently begun to
express increasing interest in securing supplies of coking coal to meet their
anticipated needs. This level of customer interest stands in stark contrast
to the relative lack of activity that marked Alpha's second quarter 2009. As
the largest U.S. supplier of metallurgical coal, Alpha is highly leveraged to
the global metallurgical coal market, and is favorably positioned to benefit
from the likely strengthening of worldwide demand for coking coal.

Outlook

Alpha is fully committed and priced for the balance of 2009, and based on the
midpoint of the Company's shipment guidance range nearly 90% of Alpha's 2010
expected shipments are committed for delivery, with 80% committed and priced.
Based on strengthening metallurgical coal fundamentals and recent customer
activity, Alpha is increasing its 2010 shipment guidance for metallurgical
coal from a range of 9-11 million tons to a range of 10-12 million tons.
Management believes average per ton realizations for metallurgical coal are
likely to rise in the current environment, and with approximately 54% of 2010
met coal shipments uncommitted and only 19% committed and priced, Alpha is
well positioned to benefit from this strengthening market.

Alpha proactively adjusted production levels in 2009 to match demand levels by
reducing overtime, taking shifts out, selectively closing higher-cost mines,
and cutting back on contractor production. As the markets for metallurgical
and later thermal coal improve, Alpha stands ready to ramp production to meet
demand as necessary, and as a combined company following the recent merger
Alpha has the capacity to produce greater than 90 million tons annually.

Guidance*
(in millions, except per-ton and percentage amounts)

Full year
combined
pro forma
2009 2010
---- ----
Average per Ton Sales
Realization on Committed and
Priced Coal Shipments(1)
-----------------------------
West 10.47 11.20
---- ----- -----
Eastern Steam 63.04 68.09
------------- ----- -----
Eastern Met 98.73 114.48
----------- ----- ------
Coal Shipments(2) 84.0 - 88.0 80.0 - 90.0
--------------- ----------- -----------
West 50.0 - 51.5 47.0 - 50.0
---- ----------- -----------
Eastern Steam 26.0 - 28.0 23.0 - 28.0
------------- ----------- -----------
Eastern Met 8.0 - 8.5 10.0 - 12.0
----------- --------- -----------
Committed and Priced (%)(3) 100% 80%
------------------------- --- ---
West 100% 99%
---- --- ---
Eastern Steam 100% 70%
------------- --- ---
Eastern Met 100% 19%
----------- --- ---
Committed and Unpriced (%)(4) 0% 9%
--------------------------- --- ---
West 0% 0%
---- --- ---
Eastern Steam 0% 17%
------------- --- ---
Eastern Met 0% 27%

* Presented on a pro forma basis to facilitate comparison with 2010 but will
differ from actual numbers presented for the 9 months ended September 30, 2009
and what will be reported for the full year 2009.

Notes:
1. Based on committed and priced coal shipments as of October 23, 2009.
2. Eastern shipments in 2009 and 2010 include an estimated 2.0 to 3.0
million tons of brokered coal per year.
3. As of October 23, 2009, compared to the midpoint of shipment guidance
range.

4. In 2010, committed and unpriced Eastern tons include approximately 0.8
million tons of steam coal subject to collared pricing with an average
pricing range of $76 to $86 per ton, legacy contracts covering
approximately 0.5 million tons of steam coal subject to average indexed
pricing estimated at $66.17 per ton, 3.1 million tons of committed
steam
coal subject to market pricing, and 2.9 million tons of committed met
coal subject to market pricing.

About Alpha Natural Resources

Alpha Natural Resources is one of America's premier coal suppliers with coal
production capacity of greater than 90 million tons a year. Alpha is the
nation's leading supplier and exporter of metallurgical coal used in the
steel-making process and is a major supplier of thermal coal to electric
utilities and manufacturing industries across the country. The Company,
through its affiliates, employs approximately 6,200 people and operates more
than 60 mines and 14 coal preparation facilities in the regions of Northern
and Central Appalachia and the Powder River Basin. More information about
Alpha can be found on the Company's website at www.alphanr.com.

Forward Looking Statements

This news release includes forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are based on Alpha's expectations and beliefs concerning future
events and involve risks and uncertainties that may cause actual results to
differ materially from current expectations. These factors are difficult to
predict accurately and may be beyond Alpha's control. The following factors
are among those that may cause actual results to differ materially from our
forward-looking statements:

-- worldwide market demand for coal, electricity and steel;
-- global economic, capital market or political conditions, including a
prolonged economic recession in the markets in which we operate;
-- decline in coal prices;
-- our liquidity, results of operations and financial condition;
-- regulatory and court decisions;
-- competition in coal markets;
-- changes in environmental laws and regulations, including those
directly
affecting our coal mining and production, and those affecting our
customers' coal usage, including potential carbon or greenhouse gas
related legislation;
-- changes in safety and health laws and regulations and the ability to
comply with such changes;
-- availability of skilled employees and other employee workforce
factors,
such as labor relations;
-- the inability of our third-party coal suppliers to make timely
deliveries and our customers refusing to receive coal under agreed
contract terms;
-- ongoing instability and volatility in worldwide financial markets;
-- future legislation and changes in regulations, governmental policies
or
taxes or changes in interpretation thereof;
-- inherent risks of coal mining beyond our control;
-- disruption in coal supplies;
-- the geological characteristics of the Powder River Basin, Central and
Northern Appalachian coal reserves;
-- our production capabilities and costs;
-- our ability to integrate the operations we have acquired or developed
with our existing operations successfully, as well as those operations
that we may acquire or develop in the future;
-- the risk that the businesses of old Alpha and Foundation will not be
integrated successfully or such integration may be more difficult,
time-consuming or costly than expected;
-- our actual results of operations following the merger, which may
differ
significantly from the pro forma financial data contained in this
quarterly report;
-- the calculations of, and factors that may impact the calculations of,
the acquisition price in accordance with the methodologies of ASC 805,
formerly SFAS 141(R), the allocation of this acquisition price to the
net assets acquired, and the effect of this allocation on future
results, including our earnings per share, when calculated on a GAAP
basis;
-- our plans and objectives for future operations and expansion or
consolidation;
-- the consummation of financing transactions, acquisitions or
dispositions
and the related effects on our business;
-- our relationships with, and other conditions affecting, our customers;
-- reductions or increases in customer coal inventories and the timing of
those changes;
-- changes in and renewal or acquisition of new long-term coal supply
arrangements;
-- railroad, barge, truck and other transportation availability,
performance and costs;
-- availability of mining and processing equipment and parts;
-- disruptions in delivery or changes in pricing from third party vendors
of goods and services which are necessary for our operations, such as
fuel, steel products, explosives and tires;
-- our assumptions concerning economically recoverable coal reserve
estimates;
-- our ability to obtain, maintain or renew any necessary permits or
rights, and our ability to mine properties due to defects in title on
leasehold interest;
-- changes in postretirement benefit obligations and pension obligations;
-- fair value of derivative instruments not accounted for as hedges that
are being marked to market;
-- indemnification of certain obligations not being met;
-- continued funding of the road construction business, related costs,
and
profitability estimates;
-- restrictive covenants in our credit facility and the indenture
governing
our convertible notes;
-- certain terms of our convertible notes, including any conversions,
that
may adversely impact our liquidity;
-- weather conditions or catastrophic weather-related damage; and

-- other factors, including the other factors discussed in "Overview -
Coal
Pricing Trends, Uncertainties and Outlook" below, and Part I, Item 1A,
"Risk Factors," of our annual report on Form 10-K for the year ended
December 31, 2008.

These and other risks and uncertainties are discussed in greater detail in old
Alpha's and Foundation's Annual Reports on Form 10-K and other documents filed
with the Securities and Exchange Commission. Forward-looking statements in
this news release or elsewhere speak only as of the date made. New
uncertainties and risks come up from time to time, and it is impossible for
Alpha to predict these events or how they may affect the Company. Alpha has no
duty to, and does not intend to, update or revise the forward-looking
statements in this news release after the date it is issued. In light of
these risks and uncertainties, investors should keep in mind that the results,
events or developments disclosed in any forward-looking statement made in this
news release may not occur.

FINANCIAL TABLES FOLLOW

Alpha Natural Resources, Inc and Subsidiaries
Condensed Consolidated Statements of Income
(In Thousands Except Shares and Per Share Data)
(Unaudited)

Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
2009 2008 2009 2008
Revenues:
Coal sales $662,396 $601,477 $1,423,169 $1,627,617
Freight and handling 47,592 75,709 129,091 220,896
Other 19,258 11,218 49,960 36,640
------ ------ ------ ------
Total 729,246 688,404 1,602,220 1,885,153
------- ------- --------- ---------

Costs and expenses:
Coal sales (exclusive
of items shown
separately below) 469,451 441,092 1,039,490 1,213,999
Gain on sale of coal
reserves - (11,446) - (11,446)
Freight and
handling 47,592 75,709 129,091 220,896
Other expense 11,251 40,235 15,650 35,859
Depreciation,
depletion and
amortization 78,246 40,155 154,803 125,548
Amortization of
acquired coal supply
agreements, net 57,983 - 57,983 -
Selling, general and
administrative expenses
(exclusive of
depreciation,
depletion and
amortization shown
above) 83,544 20,936 122,917 56,962
------ ------ ------- ------
Total 748,067 606,681 1,519,934 1,641,818
------- ------- --------- ---------

(Loss) income from
operations (18,821) 81,723 82,286 243,335
------- ------ ------ -------

Other income (expense):
Interest expense (42,835) (9,723) (62,854) (30,225)
Interest income 295 2,725 1,275 5,702
Loss on early
extinguishment of
debt (5,641) (33) (5,641) (14,702)
Miscellaneous income
(expense) 856 481 1,037 478
--- --- ----- ---
Total other
(expense), net (47,325) (6,550) (66,183) (38,747)
------- ------ ------- -------

(Loss) income from
continuing operations
before income taxes (66,146) 75,173 16,103 204,588
Income tax benefit
(expense) 46,172 (9,066) 27,222 (39,886)
------ ------ ------ -------
(Loss) income from
continuing operations (19,974) 66,107 43,325 164,702
------- ------ ------ -------

Discontinued operations:
(Loss) earnings from
discontinued
operations before
income taxes (2,290) (11,768) (11,600) (19,590)
Gain on sale of
discontinued items - 13,635 - 13,635
Income tax benefit 2,765 (543) 5,099 1,346
----- ---- ----- -----
Income (loss) from
discontinued
operations 475 1,324 (6,501) (4,609)
--- ----- ------ ------

Net (loss) income $(19,499) $67,431 $36,824 $160,093
======== ======= ======= ========

(Loss) earnings per
common share:
Basic (loss) earnings
per common share:
(Loss) income from
continuing
operations $(0.19) $0.95 $0.53 $2.42
(Loss) income from
discontinued
operations - 0.02 (0.08) (0.07)
--- ---- ----- -----
Net (loss)
income $(0.19) $0.97 $0.45 $2.35
====== ===== ===== =====

Diluted (loss) earnings
per common share:
(Loss) income from
continuing
operations $(0.19) $0.91 $0.53 $2.36
(Loss) income from
discontinued
operations - 0.02 (0.08) (0.07)
--- ---- ----- -----
Net (loss)
income $(0.19) $0.93 $0.45 $2.29
====== ===== ===== =====

Weighted average shares
outstanding:
Weighted average
shares--basic 102,992,689 69,578,244 81,054,020 68,071,618
Weighted average
shares--diluted 102,992,689 72,233,569 81,648,993 69,863,726

This information is intended to be reviewed in conjunction with the
company's filings with the U. S. Securities and Exchange Commission.

Alpha Natural Resources, Inc. and Subsidiaries
Supplemental Sales, Operations and Financial Data
(In Thousands, Except Per Ton and Percentage Data)
(Unaudited)

Three Months Ended Nine Months Ended
September 30, September 30,
------------------- ------------------
2009 2008 2009 2008
Tons sold (1):
Powder River
Basin 8,618 - 8,618 -
Eastern steam 5,752 3,961 11,727 11,767
Eastern
metallurgical 2,086 2,985 5,584 8,958
----- ----- ----- -----
Total 16,456 6,946 25,929 20,725
====== ===== ====== ======

Average realized price
per ton sold (2):
Powder River
Basin $10.39 $- $10.39 $-
Eastern steam 64.43 52.10 66.83 51.13
Eastern
metallurgical 96.92 132.35 98.48 114.51
Weighted average
total $40.25 $86.58 $54.89 $78.52

Coal sales revenue
summary
Powder River
Basin $89,569 $- $89,569 $-
Eastern steam 370,618 206,465 783,697 601,879
Eastern
metallurgical 202,209 395,012 549,903 1,025,738
------- ------- ------- ---------
Total coal
sales
revenue $662,396 $601,477 $1,423,169 $1,627,617
======== ======== ========== =========

Cost of coal sales
per ton (3):
Powder River
Basin $8.08 $- $8.08 $-
East (4) 50.62 63.50 55.85 58.58
Weighted
average
total $28.53 $63.50 $40.09 $58.58

Weighted average
coal margin per
ton (5) $11.72 $23.08 $14.80 $19.94
Weighted average
coal margin
percentage (6) 29.1% 26.7% 27.0% 25.4%

Cash flows
provided by
operating
activities
including
discontinued
operations $104,541 $156,366 $162,116 $335,803
Capital
expenditures
including
discontinued
operations $56,706 $39,425 $102,816 $113,632

As of
-----
September 30, December 31,
2009 2008
---- ----
Liquidity ($ in 000's):
Cash and cash equivalents $481,557 $676,190
Unused revolving credit facility 472,967 292,425
------- -------
Total available liquidity $954,524 $968,615
======== ========

(1) Stated in thousands of short tons.
(2) Coal sales revenue divided by tons sold. This statistic is stated as
free on board (FOB) at the processing plant.
(3) Cost of coal sales divided by tons sold, The cost of coal sales
per ton for the Powder River Basin and the East includes only costs
associated with active mines. The weighted average total includes
cost of coal sales for active mines plus cost of coal sales assigned
to closed or idle mines that are not presented as discontinued
operations.
(4) East includes the Company's operations in Central Appalachia
(CAPP) and Northern Appalachia (NAPP) and excludes amounts for
closed or idled mines.
(5) Weighted average total sales realization per ton less weighted
average total cost of coal sales per ton.
(6) Weighted average coal margin per ton divided by weighted average
total sales realization per ton.

This information is intended to be reviewed in conjunction with the
company's filings with the U. S. Securities and Exchange Commission.

Alpha Natural Resources, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In Thousands)

September 30, December 31,
2009 2008
-------------- -------------
(Unaudited)
Cash and cash equivalents $481,557 $676,190
Trade accounts receivable, net 265,848 163,674
Deferred income taxes 26,101 -
Inventories 187,855 86,594
Prepaid expenses and other current assets 105,887 65,325
------- ------
Total current assets 1,067,248 991,783
Property, equipment and mine development
costs, net 1,063,216 356,758
Owned and leased mineral rights, net 2,027,573 180,458
Coal supply agreements, net 434,807 2,090
Owned lands 89,588 12,882
Goodwill 372,551 20,547
Other intangibles, net 1,032 1,745
Deferred income taxes - 83,689
Other non-current assets 65,782 59,886
------ ------
Total assets $5,121,797 $1,709,838
========== ==========

Current portion of long-term debt $33,500 $232
Note payable 1,859 18,288
Trade accounts payable 146,054 102,975
Accrued expenses and other current
liabilities 250,653 140,459
------- -------
Total current liabilities 432,066 261,954
Long-term debt 756,553 432,795
Pension and postretirement medical
benefit obligations 698,557 60,211
Asset retirement obligation 195,595 90,565
Deferred income taxes 340,174 -
Other non-current liabilities 151,982 68,621
------- ------
Total liabilities 2,574,927 914,146
Stockholders' equity 2,546,870 795,692
--------- -------
Total liabilities and stockholders'
equity $5,121,797 $1,709,838
========== ==========

This information is intended to be reviewed in conjunction with the
company's filings with the U. S. Securities and Exchange Commission.

Alpha Natural Resources, Inc. and Subsidiaries
Reconciliation of Adjusted EBITDA from Continuing Operations
to Income from Continuing Operations
(In Thousands)
(Unaudited)

EBITDA from continuing operations and adjusted EBITDA from continuing
operations are non-GAAP measures used by management to gauge operating
performance and normalized levels of earnings. Alpha defines EBITDA
from continuing operations as income (loss) from continuing operations
plus interest expense, income tax expense, depreciation, depletion and
amortization, and amortization of coal supply agreements less interest
income and income tax benefit. Alpha defines adjusted EBITDA from
continuing operations as EBITDA from continuing operations plus expenses
attributable to the merger with Foundation Coal Holdings, Inc., losses
on early extinguishment of debt, plus gain on sale of coal reserves.
The definition of adjusted EBITDA from continuing operations may be
changed periodically by management to adjust for significant items
important to an understanding of operating trends. Management presents
EBITDA from continuing operations and adjusted EBITDA from continuing
operations as a supplemental measure of the company's performance and
debt service capacity that may be useful to securities analysts,
investors and others. EBITDA from continuing operations and adjusted
EBITDA from continuing operations are not, however, a measure of
financial performance under U. S. GAAP and should not be considered
as an alternative to net income, income from continuing operations or
operating income as determined in accordance with U.S. GAAP. Moreover,
EBITDA from continuing operations and adjusted EBITDA from continuing
operations are not calculated identically by all companies. A
reconciliation of EBITDA from continuing operations and adjusted EBITDA
from continuing operations to income from continuing operations, the
most directly comparable U.S. GAAP measure is provided in the table below.

Three
Three Months Ended months ended Nine Months Ended
September 30, June 30, September 30,
------------------- ------------ ---------------
2009 2008 2009 2009 2008
(Loss) income from
continuing
operations $(19,974) $66,107 $16,678 $43,325 $164,702
Interest expense 42,835 9,723 10,166 62,854 30,225
Interest income (295) (2,725) (355) (1,275) (5,702)
Income tax
(benefit) expense (46,172) 9,066 5,323 (27,222) 39,886
Depreciation,
depletion and
amortization 78,246 40,155 36,352 154,803 125,548
Amortization of
acquired coal
supply agreements 57,983 - - 57,983 -
------ --- --- ------ ---
EBITDA from
continuing
operations 112,623 122,326 68,164 290,468 354,659
Merger related
expenses 42,442 - 4,155 46,597 -
Gain on sale of
coal reserves - (11,446) - - (11,446)
Loss on early
extinguishment of
debt 5,641 33 - 5,641 14,702
----- --- --- ----- ------
Adjusted EBITDA
from continuing
operations $160,706 $110,913 $72,319 $342,706 $357,915
======== ======== ======= ======== ========

This information is intended to be reviewed in conjunction with the
company's filings with the U. S. Securities and Exchange Commission.

Alpha Natural Resources, Inc. and Subsidiaries
Reconciliation of Adjusted Income from Continuing Operations
to Income from Continuing Operations
(In Thousands)
(Unaudited)

Adjusted income from continuing operations and adjusted diluted earnings
per common share from continuing operations are non-GAAP measures used by
management to gauge performance and normalized earnings levels. Alpha
defines adjusted income from continuing operations as income from
continuing operations plus expenses attributable to the merger with
Foundation Coal Holdings, Inc., losses on early extinguishment of debt,
the portion of interest expense attributable to termination of an interest
rate swap, and amortization of coal supply agreements, less gain on sale
of coal reserves, discrete income tax benefits from reversal of valuation
allowances for deferred tax assets and estimated income tax effects of the
pre-tax adjustments. Adjusted diluted earnings per common share from
continuing operations is adjusted income from continuing operations
divided by weighted average diluted shares. The definition of adjusted
income from continuing operations may be changed periodically by
management to adjust for significant items important to an understanding
of operating trends. Management presents adjusted income from continuing
operations and adjusted earnings per share from continuing operations as
supplemental measures of the company's performance that it believes are
useful to securities analysts, investors and others in assessing the
company's performance over time. Adjusted income from continuing
operations and adjusted diluted earnings per common share from
continuing operations are not, however, measures of financial
performance under U. S. GAAP and should not be considered as an
alternative to net income, income from continuing operations, operating
income or diluted earnings per share from continuing operations as
determined in accordance with U.S. GAAP. Moreover, adjusted income
from continuing operations and adjusted diluted earnings per common
share from continuing operations are not calculated identically by all
companies. A reconciliation of adjusted income from continuing
operations to income from continuing operations, the most directly
comparable U.S. GAAP measure, and the weighted average diluted shares
used to calculate adjusted earnings per common share from continuing
operations are provided in the table below.

Three
Three Months Ended months ended Nine Months Ended
September 30, June 30, September 30,
------------------- ------------ ---------------
2009 2008 2009 2009 2008
(Loss) income
from
continuing
operations $(19,974) $66,107 $16,678 $43,325 $164,702
Gain on sale
of coal
reserves - (11,446) - - (11,446)
Merger related
expenses 42,442 - 4,155 46,597 -
Loss on early
extinguishment
of debt 5,641 33 - 5,641 14,702
Charge arising
from
termination of
hedge accounting
for interest
rate swap 23,549 - - 23,549 -
Amortization
of acquired
coal supply
agreements 57,983 - - 57,983 -
Estimated
income tax
effect of
above
adjustments (38,061) 2,853 (1,039) (39,093) (814)
Reversal of
deferred
income tax
asset
valuation
allowance (22,185) (8,994) - (22,185) (26,946)
------- ------ - ------- -------
Adjusted
income from
continuing
operations $49,395 $48,553 $19,794 $115,817 $140,198
======= ======= ======= ======== ========

Weighted
average
shares-
diluted 104,679,572 72,233,569 70,894,017 82,211,348 69,863,726
=========== ========== ========== ========== ==========

Adjusted
diluted
earnings per
common share
from
continuing
operations $0.47 $0.67 $0.28 $1.41 $2.01

This information is intended to be reviewed in conjunction with the
company's filings with the U. S. Securities and Exchange Commission.

SOURCE Alpha Natural Resources, Inc.

Todd Allen, CFA, Vice President, Investor Relations of Alpha Natural
Resources, Inc., +1-276-739-5328, tallen@alphanr.com