Cloud Peak Energy Inc. Announces Results for Fourth Quarter and Full Year 2012

Cloud Peak Energy Inc. (NYSE:CLD), one of the largest U.S. coal
producers and the only pure-play Powder River Basin ('PRB?) coal
company, today announced results for the fourth quarter and full year
2012.

2012 Highlights and Recent Developments

• 
  Reduced All Injury Frequency Rate by 31% from 1.18 last year to 0.82
  in 2012.
  
• 
  Adjusted EBITDA⁽¹⁾ of $338.8 million for the full year 2012
  compared with $351.7 million for 2011; Adjusted EBITDA of $89.0
  million in the fourth quarter 2012 compared with $92.9 million in the
  fourth quarter 2011.
  
• 
  2012 net income of $173.7 million resulting in diluted EPS of $2.85
  compared to $3.13 for 2011. Fourth quarter 2012 net income of $28.2
  million and diluted EPS of $0.46 compared to $0.72 in the fourth
  quarter 2011.
  
• 
  Adjusted EPS⁽¹⁾ of $2.15 for 2012, and $0.54 for the fourth
  quarter, compared to $2.47 for 2011 and $0.70 for the fourth quarter
  2011.
  
• 
  Cash and investments were $278.0 million and total available liquidity
  was $778 million as of December 31, 2012. We generated $247.4 million
  in cash from operations for the full year 2012. During the fourth
  quarter, we generated cash from operations of $45.4 million.
  
• 
  Annual shipments of 90.6 million tons from our three operated mines.
  Asian exports were approximately 0.9 million tons in the fourth
  quarter 2012 compared to 1.0 million tons in the fourth quarter 2011.
  For the full year, Asian exports were 4.4 million tons, down from 4.7
  million tons in the full year 2011.
  
• 
  Proven and probable reserves of 1.3 billion tons at December 31, 2012.
  
• 
  Acquired Youngs Creek project with over 450 million tons of in-place
  coal, of which 287 million tons are now classified as non-reserve coal
  deposits, along with 38,800 acres of surface land in the Northern
  Powder River Basin ('NPRB?) to further Cloud Peak Energy′s potential
  for increased Asian exports.
  
• 
  Signed option and exploration agreements with the Crow Indian Tribe
  covering up to 1.4 billion tons of in-place coal near Cloud Peak
  Energy′s NPRB properties. Department of Interior approval of the
  agreements is pending.
  
• 
  Announced an agreement to sell our 50% interest in the Decker mine to
  Ambre Energy with the consideration including an option for up to 5
  million tonnes of annual capacity through Ambre′s planned Millennium
  Bulk Terminal.
  
• 
  Today announced a throughput option agreement with SSA Marine that
  provides Cloud Peak Energy with an option for up to 16 million tonnes
  of capacity per year through the planned dry bulk cargo Gateway
  Pacific Terminal at Cherry Point in the State of Washington.
  

⁽¹⁾ Defined later.

'Given the challenging external environment in 2012, I am very pleased
with the operational and financial performance of the company,? said
Colin Marshall, President and Chief Executive Officer. 'Our operations
have done a great job of controlling costs in a year when shipments
varied significantly from quarter to quarter. We continued to position
ourselves for future export growth by completing a number of important
transactions. In June, we purchased the Youngs Creek project, adjacent
to our Spring Creek mine, with over 450 million tons of in-place coal,
of which 287 million tons are now classified as non-reserve coal
deposits, and over 38,800 acres of land. Last month we signed the
exploration and option agreements with the Crow Tribe covering up to 1.4
billion tons of in-place coal also located close to our Spring Creek
mine. We concluded an option agreement with SSA Marine for up to 16
million tonnes of annual port capacity at its proposed Gateway Pacific
Terminal and expect to soon have an option for up to 5 million tonnes of
annual capacity at Ambre Energy′s proposed Millennium Bulk Terminal as
part of the pending sale of our 50% interest in the Decker mine. It has
been a busy year for Cloud Peak Energy as we position ourselves for
future growth.?

Health, Safety and Environment Record

During 2012, of our nearly 1,400 full-time mine site employees, 12
suffered minor reportable injuries resulting in a year-to-date MSHA All
Injury Frequency Rate of 0.82, a decrease over the full year 2011 rate
of 1.18. During the six MSHA inspector days in the fourth quarter of
2012, we were issued one substantial and significant ('S&S?) citation.
'Our 2012 safety performance improved significantly over 2011 and
thankfully the 12 injuries that did occur were relatively minor. We will
continue to stay focused on safety throughout 2013,? said Marshall.

In 2012, Cloud Peak Energy, along with other members of the National
Mining Association, announced their commitment to implement a new
workplace safety and health program called CORESafety. This paradigm is
a scalable safety and health management system specifically designed for
U.S. mining operations and is consistent with existing Cloud Peak Energy
approaches. CORESafety provides a comprehensive pathway to achieve its
members′ goals of eliminating fatalities and reducing the rate of mining
injuries by 50% within five years.

In 2012, Cloud Peak Energy successfully retained our ISO 14001
environmental certification. ISO 14001 is an internationally recognized
certification that defines the requirements for establishing,
implementing and operating an effective environmental management system.
We believe Cloud Peak Energy continues to be the only PRB coal company
to maintain this certification.

Consolidated Business Results

The following table summarizes certain consolidated results (in
millions, except per share amounts):

(1) Non-GAAP financial measure; please see definition and reconciliation
below in this release and the attached tables.

Total revenue declined 2.4% for the full year 2012 due to 5.7 million
fewer tons sold, partly offset by a 2% rise in realized prices.
Correspondingly, Adjusted EBITDA for the full year 2012 declined 4% to
$338.8 million, down from $351.7 million in 2011.

Total revenue declined 6.9% in the fourth quarter 2012 due to 1.7
million fewer tons sold. Correspondingly, Adjusted EBITDA for the fourth
quarter 2012 declined 4% to $89.0 million, down from $92.9 million in
the fourth quarter 2011.

Operating Segments

Historically, we have reported one segment. As of December 31, 2012, we
are now presenting three segments: Owned and Operated Mines; Logistics
and Related Activities; and Corporate and Other.

Owned and Operated Mines

Our Owned and Operated Mines segment comprises the results of mine site
sales from our three owned and operated mines primarily to our domestic
utility customers and also to our Logistics and Related Activities
segment.

(1) Non-GAAP financial measure; please see definition and reconciliation
below in this release and the attached tables.

Mine site sales volumes in the fourth quarter 2012 were down 6% over the
fourth quarter 2011 due to weaker demand for coal nationwide. Mine site
sales volumes for the full year 2012 were down 5% over 2011. The lower
demand for our coal was primarily a result of the warm 2011/2012 winter.
This resulted in lower electricity demand and lower natural gas prices
that allowed utilities to opportunistically switch generation to gas. As
a result, during the first half of the year, utilities stockpiled a
portion of their contracted coal. While PRB coal burn has recovered some
ground as natural gas prices have risen, stockpiles are still at
elevated levels.

In response to weak market conditions and reduced production, our
operations focused successfully on controlling variable costs. Condition
monitoring and planned maintenance programs continue to allow equipment
lives to be extended and reduce maintenance costs without compromising
equipment integrity. Costs were also managed by reducing the use of
outside contractors, matching hiring to production and completing more
maintenance and capital projects without using contractors.

The average price realized for a ton of coal in 2012 was up 2% to $13.19
from $12.92 in 2011. Our average cost per ton was $9.57 in 2012, up from
$9.12 in 2011 driven primarily by lower tonnage produced. The 2012 full
year operating margin was $3.62 per ton, down slightly from $3.80 per
ton for full year 2011.

Logistics and Related Activities

Our Logistics and Related Activities segment comprises the results of
our logistics and transportation services to our domestic and
international customers.

(1) Non-GAAP financial measure; please see definition and reconciliation
below in this release and the attached tables.

Overall, shipments where we delivered coal to our customers were
marginally lower in 2012. This comprised a 0.2 million ton increase in
our domestic deliveries, combined with a 0.3 million ton reduction in
our international deliveries. As international coal prices fell our
export deliveries were reduced as we curtailed shipments through the
Ridley terminal due to the greater rail costs for shipments through that
terminal and focused on deliveries through the Westshore terminal. As a
result of fewer tons being transported by us through the Ridley
terminal, which is over 2,600 miles from our mines and can require us to
utilize up to three different rail carriers, we were able to reduce the
costs of deliveries in 2012 compared to 2011.

Adjusted EBITDA increased $32.4 million over 2011, due to higher
international realized prices at the time we contracted our deliveries;
lower costs as we curtailed deliveries through the Ridley Terminal; and
realized derivative gains of $11.2 million. Our Asian delivered sales
are priced broadly in line with a number of international coal price
indices adjusted for energy content and other quality and delivery
criteria. These indices include the Newcastle benchmark price which is
an established index for high Btu Australian thermal coal available to
be loaded on a vessel at a coal terminal near Newcastle, north of
Sydney, Australia. Based on comparative quality and transport costs, our
delivered international sales are generally priced in a range around 60%
to 70% of the forward Newcastle price. We also use derivative financial
instruments to help secure forward prices on a portion of our
international coal deliveries and realized gains of $11.2 million in
2012. There were no realized gains in 2011. Domestic deliveries of 1.4
million tons were made to a number of utility and industrial customers
in 2012, up from 1.2 million tons in 2011.

Corporate and Other

Our Corporate and Other segment comprises the results of our broker
activities, our share of the Decker mine and unallocated corporate costs.

Adjusted EBITDA for Corporate and Other for full year 2012 was less than
$0.1 million, compared to $8.1 million in 2011. The decrease was due to
reduced earnings at the Decker mine and reduced broker activities in
2012.

Balance Sheet and Cash Flow

Cash flow from operations totaled $45.4 million for the fourth quarter
of 2012 compared to $84.3 million for the fourth quarter 2011. Capital
expenditures (excluding capitalized interest) were $17.1 million for the
fourth quarter 2012 compared to $26.7 million for fourth quarter 2011.
We also invested $7.4 million in port development projects. Cash flow
from operations was $247.4 million for 2012 down from $296.8 million for
full year 2011. Capital expenditures were $103.7 million for the full
year 2012 (including $50 million of capitalized interest) compared to
$142.7 million for the full year 2011 (including $34 million of
capitalized interest). In addition, coal lease payments of $129.2
million were made in 2012, and we used $300 million of available cash to
fund the Youngs Creek acquisition.

Unrestricted cash and investments as of December 31, 2012 were $278.0
million, down from $479.5 million at December 31, 2011. 'Our strong
operational performance continues to provide the cash flow to make the
investments that will serve us well in the future,? said Michael
Barrett, Chief Financial Officer. 'We are fortunate to have a strong
balance sheet and total available liquidity of $778 million as of
December 31, 2012.?

Subsequent to year end, we put in place an accounts receivable
securitization program with revolving capacity up to $75 million,
further increasing our available liquidity.

West Coast Export Terminals Update

Cloud Peak Energy announced today that we have reached an agreement with
SSA Marine that provides us an option for up to 16 million tonnes of
capacity per year through the planned dry bulk cargo Gateway Pacific
Terminal at Cherry Point in the State of Washington. This terminal will
accommodate cape size vessels. The Gateway Pacific Terminal is intended
to be capable of annually exporting up to 54 million tonnes of
commodities, including 48 million tonnes of coal. Our potential share of
capacity will depend upon the ultimate capacity of the terminal.
Subsequent to receiving the required permits, SSA Marine anticipates
approximately two years for construction. Commercial operation is
currently estimated to commence in 2018.

As part of the pending sale of our 50% interest in the Decker mine,
Ambre Energy will grant Cloud Peak Energy options for up to 5 million
tonnes per year of throughput capacity at the proposed Millennium Bulk
Terminals coal export facility in the State of Washington. This terminal
is expected to be developed in two stages. The first stage is planned to
have capacity of 25 million tonnes per year with the second stage taking
annual capacity to 44 million tonnes. Cloud Peak Energy′s options would
cover up to 2 million tonnes per year of Ambre′s share of the first
phase and 3 million tonnes per year of its share of the second phase.

On December 7, 2012, a vessel berthing at the Westshore terminal
collided with the trestle leading to their larger berth leaving it
inoperable. As a result, the terminal capacity was reduced to below 50%
of the normal throughput. On February 8, 2013, Westshore announced that
repairs to the damaged trestle at Berth 1 were completed to permit
resumption of normal operations at Berth 1, and we expect to recommence
shipments on this berth shortly.

Decker Coal Mine Divesture

Cloud Peak Energy and Ambre Energy announced that their companies
entered into agreements for Ambre Energy to purchase Cloud Peak Energy′s
50% interest in the Decker mine in Montana and assume all reclamation
liabilities. The agreements will also provide for the joint resolution
and dismissal of the pending Decker litigation. The closing of the
transaction is currently anticipated to occur during the first half of
2013 and is subject to the satisfaction of various terms and conditions,
including Ambre Energy′s full replacement of Cloud Peak Energy′s $70.7
million in outstanding reclamation and lease bonds for the Decker mine.

In addition to our options at Millennium Bulk Terminals described above,
the consideration for the Decker interest also includes a cash component
of A$57 million, if paid by Ambre Energy by March 31, 2013.
Alternatively, Ambre will issue a promissory note to Cloud Peak Energy
for A$64 million payable at a later date. The companies also entered
into other agreements intended to facilitate the respective mining and
related activities at the Decker mine and at Cloud Peak Energy′s
adjacent Spring Creek mine and Youngs Creek development project. The
sale also includes the transfer of certain land and grants of rail
easements that will improve Cloud Peak Energy′s potential rail access to
the Youngs Creek project.

Crow Project

In January 2013, we executed an Option Agreement and a corresponding
Exploration Agreement with the Crow Tribe of Indians. These agreements
remain subject to approval by the Department of the Interior. This coal
project is located on the Crow Indian Reservation in southeast Montana,
near our Spring Creek mine and Youngs Creek project in the Northern PRB
region. In exchange for an option to lease up to 1.4 billion tons of
in-place coal, we paid the Crow Tribe $2.25 million upon execution of
the Option Agreement, and will pay $1.5 million upon approval of the
Option Agreement by the Department of the Interior. In addition, we will
pay annual option payments throughout the term of the Option Agreement,
which, during the initial option period could total up to $10 million.
The Option and Exploration Agreements provide for exploration rights and
exclusive options to lease three separate coal deposits on the Crow
Indian Reservation over an initial five-year term, with two extension
periods through 2035 if certain conditions are met.

Outlook

For 2013, our Owned and Operated Mines segment is expected to experience
relatively flat revenue compared to 2012 as realized prices are not
expected to increase. Costs at the mines are expected to increase as the
mines naturally progress and the increased strip ratio requires
additional labor, consumables, and equipment. The combination of these
factors will reduce our 2013 earnings.

Currently, we have contracted 89 million tons to be delivered in 2013,
of which 81 million tons are under fixed-price contracts with a
weighted-average mine site price of $13.40 per ton. Assuming constant
prices of $11.00 per ton for 8800 Btu quality coal and $9.50 per ton for
8400 Btu quality coal on our indexed tons, the expected total realized
price for 2013 would be approximately $13.14 per ton. For 2014, we have
currently contracted to sell 57 million tons from our three
company-operated mines. Of this committed 2014 production, 44 million
tons are under fixed-price contracts with a weighted-average price of
$14.49 per ton.

Despite the recent delays due to the berth outage at Westshore, we
continue to expect to deliver approximately 4.5 million tons to
international customers from our Logistics and Related Activities
segment in 2013. Due to low current prices, we have so far only priced
approximately 1.7 million tons and expect to price the remaining
deliveries in the coming months. Current Newcastle spot prices are
approximately $90 to $95 per tonne, whereas the Newcastle index averaged
approximately $116 per tonne at the time we priced our export deliveries
for 2012.

In recent months, Newcastle prices appear to have reached a floor where
existing production is being curtailed and potential new mining projects
cancelled. This is particularly true of Australian production, which has
recently suffered from significant cost pressure and additional
taxation. During 2012, Chinese thermal and metallurgical coal imports
continued to grow rapidly to 289 million tonnes, which included record
December shipments of over 35 million tonnes, even with slower economic
growth in China. We are hopeful that reduced international production
and growing demand will support higher international delivered prices
later in 2013. We have held off pricing export deliveries for the second
half of 2013 to allow us to benefit if prices do rise in the next few
months.

'We would have liked to have come into 2013 with a few more tons
committed for future years, but the prices were such that additional
contracting for 2014 and 2015 would not have been prudent in our view.
We are optimistic that with normal winter weather that domestic utility
stockpiles will come back into balance by the middle of the year, which
should allow prices for PRB coal to rise. The very mild 2011/12 winter
and low natural gas prices accelerated the trend we have been seeing of
utilities reducing their forward contracting in the face of regulatory
uncertainty and substituting low price natural gas when available. We
believe that more utilities will be buying coal in-year, and if prices
are economic, we will participate in that contracting. We will be
responsive to our customers and the market and plan our costs and
investments accordingly,? said Marshall. 'While 2013 is likely to be a
challenging year for U.S. coal producers, I believe market conditions
will improve through the year and that Cloud Peak Energy is well placed
to prosper as they do, particularly in 2014.?

2013 Guidance ? Financial and Operational Estimates

The following table provides our current outlook and assumptions for
selected 2013 consolidated financial and operational metrics:

Conference Call Details

A conference call with management is scheduled at 5:00 p.m. ET on
February 13, 2013 to review the results and current business conditions.
The call will be webcast live over the Internet from our website at www.cloudpeakenergy.com
under 'Investor Relations.? Participants should follow the instructions
provided on the website for downloading and installing the audio
applications necessary to join the webcast. Interested individuals also
can access the live conference call via telephone at 866.362.4820
(domestic) or 617.597.5345 (international) and entering pass code
42239196.

Following the live webcast, a replay will be available at the same URL
on our website for seven days. A telephonic replay will also be
available approximately two hours after the call and can be accessed by
dialing 888.286.8010 (domestic) or 617.801.6888 (international) and
entering pass code 11527401. The telephonic replay will be available for
seven days.

About Cloud Peak Energy ^?

Cloud Peak Energy Inc. (NYSE:CLD) is headquartered in Wyoming and
is one of the largest U.S. coal producers and the only pure-play PRB
coal company. As one of the safest coal producers in the nation, Cloud
Peak Energy specializes in the production of low sulfur, subbituminous
coal. The company owns and operates three surface coal mines in the PRB,
the lowest cost major coal producing region in the nation. The Antelope
and Cordero Rojo mines are located in Wyoming and the Spring Creek mine
is located near Decker, Montana. Cloud Peak Energy also owns rights to
substantial undeveloped coal and complementary surface assets in the
Northern PRB, further building the company′s long-term position to serve
Asian export and domestic customers. With approximately 1,700 employees,
the company is widely recognized for its exemplary performance in its
safety and environmental programs. Cloud Peak Energy is a sustainable
fuel supplier for approximately 4% of the nation′s electricity.

Cautionary Note Regarding Forward-Looking Statements

This release and our related presentation contain 'forward-looking
statements? within the meaning of the safe harbor provisions of Section
27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Forward-looking statements are not statements of
historical facts and often contain words such as 'may,? 'will,?
'expect,? 'believe,? 'anticipate,? 'plan,? 'estimate,? 'seek,? 'could,?
'should,? 'intend,? 'potential,? or words of similar meaning.
Forward-looking statements are based on management′s current
expectations, beliefs, assumptions and estimates regarding our company,
industry, economic conditions, government regulations and energy
policies and other factors. Forward-looking statements may include, for
example, (1) our outlook for 2013 and future periods for our company,
the PRB and the industry in general, and our operational, financial and
export guidance, including any development of future terminal capacity
or increased access to existing or future capacity; (2) anticipated
economic conditions and demand by domestic and Asian utilities,
including the anticipated impact on demand driven by regulatory
developments and uncertainties; (3) the impact of competition from
natural gas and other alternative sources of energy used to generate
electricity; (4) coal stockpile levels and the impacts on future demand;
(5) our plans to replace and/or grow our coal tons; (6) business
development and growth initiatives; (7) operational plans for our mines;
(8) our cost management efforts; (9) industry estimates of the EIA and
other third party sources; (10) estimated Tax Receivable Agreement
liabilities; (11) anticipated completion of the sale of our 50% interest
in the Decker mine to Ambre Energy; (12) our estimates of the quality
and quantity of economic coal associated with our development projects,
the potential development of our Youngs Creek and other NPRB assets, and
our potential exercise of options for Crow Tribal coal; and (13) other
statements regarding our plans, strategies, prospects and expectations
concerning our business, operating results, financial condition and
other matters that do not relate strictly to historical facts. These
statements are subject to significant risks, uncertainties, and
assumptions that are difficult to predict and could cause actual results
to differ materially and adversely from those expressed or implied in
the forward-looking statements. Factors that could adversely affect our
future results include, for example, (a) future economic and weather
conditions; (b) coal-fired power plant capacity and utilization, demand
for our coal by the domestic electric generation industry, Asian export
demand and terminal capacity and the prices we receive for our coal and
our logistics services; (c) reductions or deferrals of purchases by
major customers and our ability to renew sales contracts; (d)
competition from other coal producers, natural gas producers and other
sources of energy, domestically and internationally, (e) environmental,
health, safety, endangered species or other legislation, regulations,
treaties, court decisions or government actions, or related third-party
legal challenges or changes in interpretations, including new
requirements or uncertainties affecting the use, demand or price for
coal or imposing additional costs, liabilities or restrictions on our
mining operations or the utility industry; (f) public perceptions,
third-party legal challenges or governmental actions and energy policies
relating to concerns about climate change, air quality or other
environmental considerations, including emissions restrictions and
governmental subsidies or mandates that make wind, solar or other
alternative fuel sources more cost-effective and competitive with coal;
(g) operational, geological, equipment, permit, labor, weather-related
and other risks inherent in surface coal mining; (h) our ability to
efficiently and safely conduct our mining operations, (i) transportation
and export terminal availability, performance and costs; (j)
availability, timing of delivery and costs of key supplies, capital
equipment or commodities such as diesel fuel, steel, explosives and
tires; (k) our ability to acquire future coal tons through the federal
LBA process and necessary surface rights and permits in a timely and
cost-effective manner and the impact of third-party legal challenges,
(l) access to capital and credit markets and availability and costs of
credit, surety bonds, letters of credit, and insurance; (m) litigation
and other contingent liabilities; (n) the timing and ability of Ambre
Energy to replace our outstanding reclamation and lease bonds for the
Decker mine and pay the cash consideration for its pending purchase of
Decker, (o) receipt of required DOI approval for the Crow Tribe
transaction, (p) proposed Pacific Northwest export terminals are not
developed in a timely manner or at all, or are developed at a smaller
capacity than planned, or we are unable to finalize and enter into
definitive throughput agreements for potential future capacity at
proposed terminals, including the Gateway Pacific Terminal and the
Millennium Bulk Terminal, (q) future development and operating costs for
our development projects significantly exceed our expectations, and (r)
other risk factors described from time to time in the reports and
registration statements we file with the Securities and Exchange
Commission ('SEC?), including those in Item 1A - Risk Factors in our
most recent Form 10-K and any updates thereto in our Forms 10-Q and
current reports on Forms 8-K. There may be other risks and uncertainties
that are not currently known to us or that we currently believe are not
material. We make forward-looking statements based on currently
available information, and we assume no obligation to, and expressly
disclaim any obligation to, update or revise publicly any
forward-looking statements made in this release or our related
presentation, whether as a result of new information, future events or
otherwise, except as required by law.

Non-GAAP Financial Measures

This release and our related presentation include the non-GAAP financial
measures of (1) Adjusted EBITDA (on a consolidated basis and for our
reporting segments) and (2) Adjusted Earnings Per Share ('Adjusted
EPS?). Adjusted EBITDA and Adjusted EPS are intended to provide
additional information only and do not have any standard meaning
prescribed by generally accepted accounting principles in the U.S.
('GAAP?). A quantitative reconciliation of historical net income to
Adjusted EBITDA and EPS (as defined below) to Adjusted EPS is found in
the tables accompanying this release.

EBITDA represents net income, or income from continuing operations, as
applicable, before (1) interest income (expense) net, (2) income tax
provision, (3) depreciation and depletion, (4) amortization, and (5)
accretion. Adjusted EBITDA represents EBITDA as further adjusted to
exclude specifically identified items that management believes do not
directly reflect our core operations. The specifically identified items
are the income statement impacts, as applicable, of: (1) the updates to
the tax agreement liability, including tax impacts of our 2009 initial
public offering and 2010 secondary offering, (2) adjustments for
derivative financial instruments including mark-to-market amounts and
cash settlements realized, and (3) our significant broker contract that
expired in the first quarter of 2010. Because of the inherent
uncertainty related to the items identified above, management does not
believe it is able to provide a meaningful forecast of the comparable
GAAP measures or a reconciliation to any forecasted GAAP measures.

Adjusted EPS represents diluted earnings (loss) per common share
attributable to controlling interest, or diluted earnings (loss) per
common share attributable to controlling interest from continuing
operations, as applicable ('EPS?), adjusted to exclude the estimated per
share impact of the same specifically identified items used to calculate
Adjusted EBITDA and described above, adjusted at the statutory rate of
36%.

Adjusted EBITDA is an additional tool intended to assist our management
in comparing our performance on a consistent basis for purposes of
business decision-making by removing the impact of certain items that
management believes do not directly reflect our core operations.
Adjusted EBITDA is a metric intended to assist management in evaluating
operating performance, comparing performance across periods, planning
and forecasting future business operations and helping determine levels
of operating and capital investments. Period-to-period comparisons of
Adjusted EBITDA are intended to help our management identify and assess
additional trends potentially impacting our company that may not be
shown solely by period-to-period comparisons of net income or income
from continuing operations. Our chief operating decision maker uses
Adjusted EBITDA as a measure of segment performance. Consolidated
Adjusted EBITDA is also used as part of our incentive compensation
program for our executive officers and others.

We believe Adjusted EBITDA and Adjusted EPS are also useful to
investors, analysts and other external users of our consolidated
financial statements in evaluating our operating performance from period
to period and comparing our performance to similar operating results of
other relevant companies. Adjusted EBITDA allows investors to measure a
company′s operating performance without regard to items such as interest
expense, taxes, depreciation and depletion, amortization and accretion
and other specifically identified items that are not considered to
directly reflect our core operations. Similarly, we believe our use of
Adjusted EPS provides an appropriate measure to use in assessing our
performance across periods given that this measure provides an
adjustment for certain specifically identified significant items that
are not considered to directly reflect our core operations, the
magnitude of which may vary drastically from period to period and,
thereby, have a disproportionate effect on the earnings per share
reported for a given period.

Our management recognizes that using Adjusted EBITDA and Adjusted EPS as
performance measures has inherent limitations as compared to net income,
income from continuing operations, EPS or other GAAP financial measures,
as these non-GAAP measures exclude certain items, including items that
are recurring in nature, which may be meaningful to investors. Adjusted
EBITDA and Adjusted EPS should not be considered in isolation and do not
purport to be alternatives to net income, income from continuing
operations, EPS or other GAAP financial measures as a measure of our
operating performance. Because not all companies use identical
calculations, our presentations of Adjusted EBITDA and Adjusted EPS may
not be comparable to other similarly titled measures of other companies.
Moreover, our presentation of Adjusted EBITDA is different than EBITDA
as defined in our debt financing agreements.

Due to the tabular presentation of rounded amounts, totals may reflect
insignificant rounding differences.