Ladies and gentlemen, thank you for standing by, and welcome to the Peabody Energy First Quarter 2012 Earnings Call. [Operator Instructions] As a reminder, today's call is being recorded. I'll now turn the conference over to Mr. Vic Svec, Senior Vice President, Investor Relations and Corporate Communications. Please go ahead.

Okay. Thank you, John, and good morning, everyone. Thanks again for taking part in the conference call for BTU. And with us today are Chairman and CEO, Greg Boyce; as well as Executive Vice President and Chief Financial Officer, Mike Crews. And we do have some forward-looking statements today. They should be considered, along with the risk factors that we note at the end of our release, as well as the MD&A section of our filed documents. As always, we would also refer you to peabodyenergy.com for some additional information. And with that, I'll turn the call over to Mike.

Well, thanks, Vic, and good morning, everyone. In the first quarter, Peabody delivered higher revenue, EBITDA, operating profit and cash flows, driven by increased contributions from both U.S. and Australian operations. That's a strong start to 2012 in spite of Australian weather issues and some challenging U.S. market conditions. Let's review the quarterly results, beginning with the income statement. First quarter revenues rose 17% to $2 billion on increased Australian volumes and higher pricing in both the U.S. and Australia. Rising revenues led to an 18% increase in first quarter EBITDA to $513 million, even with approximately $41 million in weather impacts from Australia flooding that affected costs and reduced sales by approximately 260,000 tons. Impacts were limited to the first quarter, and some of the lower volumes should be recouped in the second quarter. Diluted earnings per share totaled $0.64 with adjusted diluted earnings per share of $0.67. This came in at the upper end of our original targets given reduced DD&A both from lower volumes and a production mix favoring lower DD&A operations, along with a slightly lower tax rate. Compared with the prior year, earnings per share reflect higher operating profit, net of increased interest expense. We look for DD&A to normalize as we increase volumes from the Australia platform throughout the year. Our effective tax rate was 25% for the quarter, and we now expect the full year effective tax rate to be in the mid-20% range. I'll now turn to the additional detail within our supplemental data. Australia sales volumes totaled 6.6 million tons in the quarter, an 18% increase over the prior year due to new and expanded operations. Australian average realized pricing increased 27% to $130 per short ton due to higher realizations on both met and thermal products. During the quarter, our…

Thanks, Mike, and good morning, everyone. It's clear that Peabody has started the year very strong with increases in multiple key metrics. We remain very well positioned for both 2012 and beyond. I plan to discuss the global and U.S. coal markets, and then we'll review Peabody's position. So let's first look at the global coal markets, particularly in the Pacific where demand is strong and pricing has stabilized. Coalfield generation growth continues to be led by China and India with increases of 7% and 9%, respectively, so far this year. April 1 Newcastle thermal coal contracts have settled within 15% of record levels. Global steel production and capacity utilization are rebounding with steel prices well above last fall's trough levels. Reported spot prices for metallurgical coal are also edging above recent settlement numbers. And after a record 2011, China's net coal imports are already up more than 80% this year and running at an annualized pace of 230 million tons. China has targeted generation growth of 7%, and that's twice the pace of coal production increases, requiring greater imports. We project total seaborne coal demand will rise some 10% in 2012 with the bulk of that growth coming from the Pacific markets. Peabody projects that 385 gigawatts of coalfield generation will be added globally over the next 5 years. This equals thermal coal needs of 1.3 billion tons of coal per year. And global steel production growth is also expected to increase metallurgical coal demand by approximately 250 million tons over the same 5-year period. Emerging Asia will continue to drive this growth through urbanization and industrialization. Should China continue to grow at 8.5% per year, China's annual coal use is likely to reach 5 billion tons by 2015. And even as coal demand grows, supply -- global supply…

[Operator Instructions] First, from the line of Michael Dudas with Sterne Agee. Michael S. Dudas - Sterne Agee & Leach Inc., Research Division: Greg, to maybe expound on your comment about the first quarter issues regarding global metallurgical coal production, do you see a lot of those attributes continuing as we move through 2012? And does the market maybe not pay as much attention to that as it should given the production issues we've had in this sector over the past few years?

Yes, thanks for the question, Michael. And premise, I -- we would agree with. I think we too often look at what nameplate capacity of installed production is as we look at our supply and demand balances, and we don't really take into account what effective capacity is, which is always impacted by transportation, poor weather, geologic issues, it is a mining business and a natural resource business, and, as we're seeing unfolding in Australia right now with BMA, labor issues. So you can go over the last 3 or 4 years across the globe and the effective annualized metallurgical coal capacity is always lower than nameplate capacity, which provides a shortness in the market, which has been there and we project will be there for the foreseeable future. Michael S. Dudas - Sterne Agee & Leach Inc., Research Division: My follow-up, Greg, would be in your comments regarding -- or Mike's comments regarding first quarter U.S. volume shipments were pretty good for Peabody and not so good for the rest of the industry. Do you see that kind of normalizing in the next few quarters? And the 10 million tons that you’ve reduced on your guidance today, is that set up more towards 2013 and beyond? And as the year progresses, could we see further rationalization of some of your output goals?

Yes, I think as we look at volumes for 2012, related to the first quarter, because we entered the year fully contracted, our customers were taking their coal on a ratable basis, while others that had uncommitted positions, you'd have to assume were falling off. So we were able to actually have a very strong shipping quarter. Now as we go into the next 3 quarters of the year, as we said last call, we've had a number of customers who have looked at their volume needs for the year. We've got some requirements contracts, which will have lower burns this year, as well as other customers who have fairly healthy stockpiles that we've had some commercial discussions around rescheduling those shipments. Some of those will be in '13 and some of those will be in '14 in terms of the replacement volumes. And that isn't always necessarily ton for ton. When we negotiate these changes to these contractual positions, we look at the NPV value of the contract. We try and maintain that value. And so it's a combination of timing, volume and future price that we set as we make those contractual changes. To the extent what does the rest of the year look like, as we indicated, I think there's the potential that we'll see some continued decrease in coal demand for the rest of the year, which will require potentially some additional reductions across the industry.

Our next question is from Shneur Gershuni with UBS.

Just 2 quick questions here. And maybe as a follow-up to Mike's question, you've got the production cut in place at this point. There are still ongoing discussions. Can you sort of walk us through how the operation actually changes? Are you, in fact, idling the track lines and shovels and trucks? Or are you just sort of reducing over time? Sort of give us a sense how that works and how that would impact the fixed cost absorption if you can.

Yes, at this point in time, we've been able to manage the production cuts through lower overtime, changes in some of the operating schedules, which in effect means that you're not running your equipment at the highest utilization that you normally would have. I mean, all of that will impact to a certain degree the divisor that we have that -- and will put pressure on the cost base. But where we sit today, we believe all of that is manageable. Because our volumes are fully contracted, we can't make any changes unless we actually negotiate with our customers about what those changes may be. Others who did not have committed positions, they've got the ability to make changes under a different scenario. But for -- at this point in time, it's lower utilization on equipment and lower hours and working schedules in the operations.

Great. A follow-up question about your commentary about the coal markets globally, and met coal in particular but if you want to comment thermal as well. You kind of have a positive view for the second half. Is it related to general demand conditions? You sort of talked about a 50 million ton increased demand over a couple of years and so forth. Or is it some of your interest in met and pricing related to kind of the industrial actions in Australia and recent weather issues as well, too? I was wondering if you can parse what's related to the issues versus demand.

Well, I think the main driver right now we're seeing is demand pickup or the early signs of increasing demand pickup through the back end of the year. China's steel production for the first part of April is just running at a torrid pace. As we know, China imports were up 80% year-to-date. That was a combination of both thermal and met coal. And so I would say the bulk of it is we see strengthening in the demand side, but we also see that -- and we've always had a view that supply side was -- going back to our earlier conversation, the effective supply side capacity was lower than nameplate, which maintains this structural deficit in terms of supply.

Our next question is from Jim Rollyson with Raymond James. James M. Rollyson - Raymond James & Associates, Inc., Research Division: Kind of circling back, I guess, on the U.S. side. You've mentioned, Greg, preserving the NPV of your contracts, and it maybe isn't volume ton for ton which I assume means or implies that maybe you get a little bit better pricing all-in on a little bit fewer tons or somewhat fewer tons just given the way the market's running so far this year. And I noticed in the quarter your all-in U.S. average pricing came out a little bit better than we were thinking. And I'm kind of curious. Just a little bit of color for the rest of the year. Should we expect U.S. average pricing -- and I realize the mix can bounce around, but should we expect pricing generally to be as strong as 1Q or maybe even stronger, especially if you get some adjustments to preserve your NPV? Is that a fair thought?

Well, I think -- this is Mike. I think when you look at the -- when we talk about working with our customers, there's a couple of different ways that we can go. You can look at cash payments that impact realization on a near term. You can look at pushing out volume. You can talk about the pricing and how that would impact later periods. We didn't have good, strong year-over-year growth there. We were fully committed here. And we're encouraged by the revenue growth that we've had. As we work through the negotiations on some of these volumes, that would ultimately have an impact on the ultimate revenue realization. What I will say as it relates to the U.S. platform, even with the guidance that we've given around taking out 10 million tons, and we've said this before and I'm happy to say that we still believe that we're going to have stable margins in the U.S. And when we look at the cost position that we have and relative to what we think the inflation may be, which goes to the question of: Which -- with lower volume, could you have a little bit of an uptick in cost? But we're looking at mid- to high-single digit cost increases between the Midwestern platform and the Western platform, and that helps preserve the margin. And that, coupled with contracts that have been layered on in prior periods and strong markets, leads us to a favorable position in the U.S. James M. Rollyson - Raymond James & Associates, Inc., Research Division: That's certainly helpful. And as a follow-up, Greg, you kind of began the year thinking 33 million to 36 million tons of volumes out of Australia. Even despite the little bit of weather kind of issues you had later in the quarter, you're maintaining that. Is that a function of just expecting to be able to make it up as you go through the last 3 quarters? Or kind of what's driving it given the $41 million hit you had in 1Q?

Yes, in terms of the sales volumes for Australia for the year, it is a function of us looking at our ability to recoup those tons during the course of the last 3 quarters of the year. So at this point, we're maintaining our sales targets. I was down in Australia just 2 weeks ago and, as we look at the next 3 quarters, feel comfortable we'll be able to achieve and maintain those existing original targets.

Our next question is from Andre Benjamin with Goldman Sachs.

My first question would be, what are your domestic utilities saying about the level of inventory versus both normal levels and maximum? So I'm trying to understand how many might say that they're close or at their max. And are you seeing a lot of them dump the stacks into the spot market or even into the export market?

Yes, well, when you look at overall inventories in the U.S., they're estimated around mid-190s tons, which is a high level. It's different by region. The CAP region is the highest in terms of volumes and number of days supply. We don't have a significant number of those pure CAP power plant customers. The Illinois Basin is up there, and then the Powder River Basin has started to come up. So we're not with anybody right now that's saying, "Look, we're up to the rafters, and we can't take another delivery." But they're all looking at their inventory levels, looking at the fact that we're now in the shoulder season, trying to anticipate what a summer burn may be, and then looking at how do they make sure nobody gets into a crisis situation. And so those are the customers that we're talking to. And we've talked to a few -- some of our Illinois Basin customers and we've talked to some of our Powder River Basin customers. We've got a few other requirements contracts, particularly one in the Southwest, where the burn is anticipated to be lower than it has been historically. And so we've been -- we've adjusted those production levels as well.

And I guess as someone that's been working to get into China, you've been working with some of the suppliers. So a question about the supply side in China. I know their domestic met coal production has grown at a pretty healthy rate over the last few years. I was wondering if you could discuss what you're hearing about willingness to continue growing domestic met coal production at the -- relative to recent growth rates and what the cost of that production will be versus, say, your cost in Australia. Or alternatively, what kind of price do you think you need to see in order to continue to incentivize that growth?

Well, in terms of what we're seeing out of China, we're seeing some of the same signals that others are. The -- recently, China indicated that the metallurgical coal was a "precious resource" that they were going to slow the growth rate and more closely control the new production of metallurgical coal, which indicates to us that the seaborne market levels that we see today and we've seen in the past are not a particular concern to China in terms of their ability to source coal from outside of China in order to keep their steel industry moving forward on a strong basis. On the thermal side, they've -- the sheer magnitude of the demand for thermal coal in China and the bifurcated nature of the country where you've got heavy demand load in the southeast provinces, coastal areas for the electricity versus the coal regions in the north and the west indicate to us, and I think the data is now showing, that growing imports of thermal coal is a fundamental part of the China strategy to meet their energy needs going forward.

And just one statistical point on that. Our estimate is year-to-date for March, net coal imports by China are up some 40%. So that's a definitely good trend that we look forward to continue.

Our next question is from Brian Gamble with Simmons & Company. Brian D. Gamble - Simmons & Company International, Research Division: Greg, I wanted to dig a little bit into the -- your figure of north of 100 million tons of coal burn loss during 2012. If you look at announced supply cuts, you look at current inventory levels and then look at the 100 million that you're talking about, does that mean that you're expecting significantly more supply cuts from the producers or significantly, I guess, greater availability to stockpile from a utility standpoint to get to that number?

Well, I think what we're looking at right now is just to look at the demand side, and we estimate where we are relative to what we lost in the first quarter with a mild or nonexistent winter, plus what we've had in terms of coal-to-gas switching. Then you roll forward through the next 3 quarters and assume -- the best we can assume right now is normal weather patterns and gas staying in the range it is now. That's where we come up with a demand loss of in excess of 100 million tons. We kind of flagged that 85 million ton number for gas only in our last call. Now how will that reduction in demand translate into production for the year vis-à-vis where the inventory levels are? I mean, that really remains to be seen in terms of what the entire industry does. As we looked at -- you can look at announced production cuts, but they don't come close to the number that we actually saw in March where volumes were down 13%, which annualized to 140 million tons, which would give you the sense that if we maintain that pace through the end of the year, we'll actually see us -- some reductions by the end of the year in the inventories. Now our view is it's probably a bit too early to actually make that as an affirmative statement, but we also think that we're going to see more production cuts announced going forward. Brian D. Gamble - Simmons & Company International, Research Division: And then kind of as a follow-up along those same lines, when you look out to '13 and look at your open book, as you mentioned, you might be deferring some tons from '12 into '13 due to the nature of contracts or due to lower burn levels. But you still have a decent level of open tonnage for '13 as does the rest of the industry. In fact, you're probably doing just fine in relative terms. But when you think about the ability to hold off signing contracts for '13 or the ability to hold off making decisions about a production footprint for '13, how long can you do that? Do signings for '13, especially in the PRB where the tonnage is greater, need to start before summer? Or can they wait until the fall to really begin and still allow you to get to the production footprint that you'd like to be at for the year?

Yes, we've got time to certainly wait until the back end of the summer season and to the early part of the fall in order to begin to make any decisions around what our ultimate production levels next year will be. So I think the plan right now, well, we're going to see what that summer burn looks like, get a better sense as to what the inventories are looking like towards the latter part of the summer, and that'll be the stronger metrics going into next year.

Our next question is from Brian Yu with Citi.

Greg, my first question has to do with the China met coal demand. From the numbers, I could tell -- it looks like they are increasing their imports overall, but they're actually getting a greater portion from across-border trade with Mongolia. And so from your perspective, is the thought that as the year progresses, their steel production ramps up, they'll get more from Australia? And then secondly, along the same lines, you guys have a couple of initiatives in Mongolia, and I was wondering if that kind of fits into your long-term view of trying to supply that market from both sides.

Yes. First of all, in terms of increasing from Australia, I think the answer is yes. I mean, part of the issue in the first quarter was there wasn't a lot of excess coal coming out of Australia because of not only the weather issues but also some of the labor issues that were occurring. So there wasn't a lot of the, to our knowledge, really any excess to come out of Australia. But we think that'll change, obviously, going through the next 3 quarters. In terms of Mongolia, I mean, that is part of what we would like to accomplish with our Mongolian strategy, both with the TT project as well as with our Peabody Winsway joint venture exploration work that we're doing in Mongolia. And that would be they'd be a supplier of metallurgical coal from Mongolia into China as well. As we look at our long-term supply-demand balances, we've always assumed production out of Mongolia, land-based imports into China, but also saw -- see strong growth out of Australia as well. So it is a two-pronged strategy for us, and we don't see one as being detrimental to the other.

Okay. And second question I’ve got is just with the reduction in the U.S., is there a way to tell from your customer base that the reduction in burn is due mostly to blending activity in the farther East plants? Or do you see gas switching actually impacting the dedicated PRB plants in the Midwest and Texas area?

Yes, I think there's no question that we're seeing gas impacting across the country. That's just the reality of gas at the prices that it's at today. And how much that -- how long that continues, we'll see. Ultimately, we view it as a reversible trend, particularly at these levels. But almost all plants are facing competition from gas.

And next, we’ll go to Justine Fisher with Goldman Sachs.

My first question is on pricing power in the U.S. If we look at the coal curve, the front end of the curve is pretty low. And admittedly, probably, transactions from coal companies' utilities aren't taking place at those low levels. But it is pretty low versus the outer years. And then the production cuts look like they're going to meet demand but not necessarily create a tightness in the market. So what do you guys think is -- needs to happen in this market? And maybe, what's the first indicator that you would look for, for coal companies to create some pricing power for themselves such that when you do go back into the market, whether it's in the summer or the fall, you can actually price at levels that maybe you were doing a year ago or that would generate some decent margin?

Well, I think we're going to -- as we said earlier, we want to watch what happens with -- coming out of the summer burn season with the level of summer burn, as well as how production volume reductions that we're now seeing flow through to inventory management. And that will really set the stage for 2013 in terms of not only volume but how pricing is set across particularly the PRB platform but all other platforms. So it's a bit early to tell. I mean, you -- as we've said before, they're -- we're not going to mine for practice in terms of the Powder River Basin. We're going to make a margin on everything that we sell. Or we'll wait until we can make a margin on what we sell. But it probably is significantly early right now to really determine what the outcome for '13 is going to be. A normal or a normal to warmer-than-normal summer goes a long way. It's the highest burn season of the year in terms of coal.

Okay. And then the next question was on debt repayment. I know that you guys had highlighted when you made the Macarthur acquisition that you would look to repay debt going forward, and you highlighted at the beginning of the call the focus on the balance sheet. Is there an amount that you guys are anticipating paying down through the rest of this year? Have you held off on that, for example, during the first quarter because of the weakness in the market? How much debt revolver/term loan repayment can we anticipate this year given market conditions?

Well, this is Mike. It'd be difficult to get into a specific number at this point. We've been encouraged by our cash flow generation in the first quarter. But at the same time, we're going to do our analysis, looking outward over the next 3 quarters, we’ve still got met settlements we need to have in the third quarter and the fourth quarter. We still have some of the issues that we're working through in the U.S. So I can tell you that we're generating good cash flow. To the extent we have excess cash flow, our highest priority is going to be around debt reduction as a use of that cash.

Our next question is from John Bridges with JPMorgan. John D. Bridges - JP Morgan Chase & Co, Research Division: We're probably doing this supply-demand thing to death, but you mentioned the prospect for 50 million tons of exports from the U.S. But if you price that back to Central Appalachia, that's sort of $57 and these guys sort of talk about cost being $70. So I just wonder, how long do you think we can continue to export at this level? Or do you see something else going on?

Well, I think with the -- when we look at an increase in exports, most of that is probably coming from new thermal exports out of the Illinois Basin, Powder River Basin. And the predominant driver of East Coast exports has been the thermal export versus met. But then also, if you look at, John, a view that met will strengthen through the back half of the year, that should at least sustain a certain level of met coal exports coming out of the U.S. for those that have a lower-cost position. So as we wrap all of that up, we see -- we do see an increase of exports out of the U.S. this year. And then, of course, over the next 4 or 5 years, with the growth in port capacity, we see a significant increase opportunity for thermal coals out of the West and Illinois Basin either through expanded Gulf port capacity or new capacity on the West Coast. John D. Bridges - JP Morgan Chase & Co, Research Division: Oh, okay. And then as a follow-up, the increased imports into China, one of the issues though seems to be that rather than buying sort of benchmark Newcastle coal, it's other grades. Are you tweaking your strategy to take that into account?

Well, part of our Indonesian strategy that we've had within our Asia platform and our trading platform has been to secure supplies of Indonesian coal because there is a fair amount of the lower-quality coals that China imports, particularly out of Indonesia. We got a lot more data around that when we started to -- when they started to talk about their lignite imports. But that's always been part of our Indonesian strategy, to secure some supply from Indonesia because not only does it go to China, but it also serves that Indian market. But I will tell you, even within the context of our Australian platform, our signature products are the high-end, normal Newcastle products. But to the extent that we now have a market for some higher ash-type products, we've been taking advantage of that out of our Australian platform to move those products into the Indian and the Chinese market, which just allows us more operating flexibility and revenues out of Australia.

Our next question is from Holly Stewart with Howard Weil.

First question, just how does the request for deferrals in the PRB right now compare to 2009 and maybe even 2002?

2009, yes, we're -- it's probably similar at this point in time based on what we were seeing back in 2009. I'm not sure I'd have an update to go back to 2002. But certainly, for 2009, we're seeing things somewhat similar.

Okay, okay. Just curious because we're obviously lower on gas. And then just as we've -- I guess my follow-up would be as we’ve had a better view on the contribution related to Macarthur, can you review kind of the met mix in the first quarter and then how we should think about it, I guess, going through 2012?

Yes, overall, the met mix, Holly, as we looked at Q1, the hard coking coal was probably 40%, the semis were maybe another 20% and then the PCI was probably about 40% of that.

And next, go to Lucas Pipes with Brean Murray, Carret. Lucas Pipes - Brean Murray, Carret & Co., LLC, Research Division: First, on your realized price in Australia, it looked extremely strong for the first quarter, hardly unchanged from the fourth quarter. Could you maybe walk us through the various drivers that supported Q1 prices there at roughly Q4 levels despite the benchmark for met coal coming down pretty significantly during that time?

Well, in the case of Q1, we had some carryover volumes there on the price side, and we also had a good mix on the met coal side that continued to set that forward.

I think the other aspect is with the acquisitions coming in, those are higher priced. So our overall mix, because we have a higher met coal proponent now, drove the average up versus the thermal and the domestic coals that were part of the previous base. Lucas Pipes - Brean Murray, Carret & Co., LLC, Research Division: So we should also expect some carryover from Q1 into Q2? Is that a fair assumption?

There will be some modest amounts of that as well with the weather impacts that we have. Lucas Pipes - Brean Murray, Carret & Co., LLC, Research Division: Okay, great. And then to kind of stay in Australia, first, your guidance assumes a pretty nice ramp-up over the course of the year in terms of met coal in particular. Could you kind of walk us through when you expect these volume increases to materialize?

Yes, well, we don't -- we typical don't give specific guidance as it relates to quarter-to-quarter. On volume, I can tell you on a ratable basis, when you look at met 2Q to 4Q, it's probably 3.7 million to 4 million tons.

And our next question is from Curt Woodworth with Nomura.

I wanted to follow up on the seaborne thermal market. So the import data, obviously, has been very strong out of China, and yet the comment in your press release that you think their domestic production’s only going to grow about half the rate as their overall electricity generation requirement. So on a base of I think it's over 3 billion tons in China, that would lead you to a pretty significant import number for the year for thermal. So I'm just wondering what gives you the confidence on the kind of the China production number. And then if you could tie that into what we're seeing recently in the market where most of the seaborne thermal price indices have been moving lower, yet the imports have been rising. And then do you see any catalyst to get the price metrics starting to move more positively from here?

Well, a couple of things. First, on the Chinese situation, I mean, we're -- on a trend basis, we rely on what the Chinese themselves are saying relative to what their production growth is going to be over the next couple of years. Even if you make an assumption that they are likely to exceed that, there is still a significant gap between what their generation needs are and what their internal domestic production is going to be. And that's why we forecast a healthy increase in overall imports this year and over the next 4 to 5 years. In terms of pricing, Newcastle pricing was within 15% of its all-time record pricing. We've seen a bit of a widening between the European and the -- or the Atlantic and the Pacific market partly because of increased exports out of the East Coast to the U.S. But the Pacific market pricing has remained very strong.

Okay. And my follow-up question is on Macarthur. Can you give an update for some of the metrics this quarter in terms of cost performance and volume and how you see that trending for the rest of the year?

Well, in terms of overall volume performance, I would tell you that the mines we acquired from Macarthur, Coppabella and Moorvale, actually had a good quarter in terms of coming in at our forecasted levels. They've made good progress going down the improvement plan that we had established. We've added overburn capacity at Coppabella, and the equipment availabilities and productivities are increasing slightly ahead of the schedule that we had outlined. So overall, in terms of first quarter cost performance, they were slightly ahead of schedule, and we anticipate that we can keep that trend going through the rest of the year.

And next, go to Brandon Blossman with Tudor, Pickering, Holt. Brandon Blossman - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: Let's see. Just PRB, to finish that off. So the basin as a whole, particularly March production, is down quite a bit year-over-year. But commercially, you guys seemed to do exceptionally well against that. How do we reconcile that on a go-forward basis? It seems like in general, PRB burns are down quite a bit. Your guidance is down now 5% potentially on a year-over-year basis. Is that -- how does that reconcile itself over the next 3 quarters?

Well, I think you have to look beyond our platform. And there was a fair bit of uncommitted capacity from the Powder River Basin, and we'll have to see what occurs with that capacity. As I said earlier, we were fully contracted. And so to the extent that we reduce volumes for the year, it has to be after we've had the ability to negotiate contract changes with our customers. We've been able to do a certain amount of that, and that's led to -- and not of all our reductions at this point are coming solely out of the Powder River Basin, but a good percentage of it. And so we'll -- we're still continuing some discussions, but I think we're going to have to wait and see what the rest of the Powder River Basin looks like over the course of the next 2 to 3 weeks. Brandon Blossman - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: And Greg, I think it was in Mike's prepared comments. It sounded like you had anticipated some contract deferrals in your current guidance, the down 5%.

Yes, that's correct. That was incorporated in the guidance that we provided. Brandon Blossman - Tudor, Pickering, Holt & Co. Securities, Inc., Research Division: That's great. Okay. Good news there. Second question, and this is more of a conceptual question, but the Illinois Basin, it is probably one of the few areas of obvious growth in the near term. Can you just comment on just customer demand globally for that product as an export product? And then just kind of recent developments on the trip from the mine out to a port?

Well, I think the demand will continue to strengthen for Illinois Basin coal as we get more global customers trying that product. It's a product that typically needs to be blended because of its quality constraints. And to a certain degree, its global reach currently is limited by the size of vessels that can be loaded out of the Gulf Coast. And so we see growth there. We've -- it's been growing. And our total level of exports this year are up a couple million tons over they were last year. But those are the 2 issues that Illinois Basin continues to need to work on relative to seamlessly flowing into the international marketplace.

Our next question is from Dave Martin with Deutsche Bank.

I wanted to start with a clarification on the 2013 contract position in the U.S. In your comments, you noted that you priced only 9 million tons for 2013. You also mentioned that some tons have been pushed out until next year. My questions are really, are those 2 items essentially the same thing? And then secondly, I'm trying to understand the other moving parts because I -- you're pointing to a total contract position of -- your price position of between 40% and 50%, which is down modestly from what you said 3 months ago.

Yes, so just to clarify that. Essentially, 9 million tons, if you think of it on a base that's nearly 200 million tons, gets you to that 5% number. That would have been the change from what we would have told you back in January. The tons that we have talked about in terms of reductions relate to anticipated reductions in 2012 numbers really doesn't apply to '13 at all. And to the extent that, that gets resolved through negotiated settlements, that, of course, would change our unpriced position, and you would see that in our next quarter data.

Yes, okay. And then secondly, I just wanted to ask about India and the global market. If you could comment on the recent developments in India related to thermal coal? And I say that in the context that there's been some reports recently that have suggested their coal plant additions over the next 5 years hadn't been what they thought they would be maybe only a few months ago. I guess my question is, do you see it that way? And does that impact your growth plans?

As we look at India, I mean, I think we all project India to be slightly slower in terms of delivering what they say they're going to deliver. But having said that, they have, in the last couple of years, rapidly emerged as a major import growth country. Their coal-field generation this year is up 9% through March. Their -- we expect their thermal -- in 2011, their imports of thermal coal increased about 85 million tons. It was almost 35%. They've got about 70 gigawatts of coal-field generation expected to come online over the next 5 years, which is about 250 million to 300 million tons of thermal coal. So a little slow getting out the gate, but what we're seeing right now is they're going to be lifting the imports at very high levels, 100 million to 200 million tons over the next 5 years, as they continue to complete this thermal generation build-out. They have a fairly explicit plan right now to encourage imports, and the generation build is along the coast with port -- import -- port capacity being built. So I guess what we're saying is yes, a bit slow out of the gate, but we expect them to come in line with the projections that we had for them.

And next we'll go to Richard Garchitorena with Crédit Suisse. Richard Garchitorena - Crédit Suisse AG, Research Division: So my first question, just I want to touch on the Australian costs. So you mentioned Q1 was the higher by roughly 6,000 tons from higher -- impact from higher -- from currency, weather, et cetera. Should we expect Q2 to Q4 come down by that same amount if you assume all else equal?

Yes, when you look at -- this is Mike. When you look at -- our prior guidance, we said we’d be in the high 70s. As you think about that $6 a ton, that was relative to our expectations. We continue to guide into the high-70s for the rest of the year for the combination of some of the things that I mentioned. You've got the acquired mines that came into the platform that raised our cost. You've got an overall higher percentage of met mix. We may have some foreign exchange impact later in the year. And that's really what's driving us to that higher 70s target toward the back half of the year. And then as you think at okay, where you are today relative to where you think you're going to be towards the end of the year with the expanding volumes that we expect over the latter 3 quarters, that would bring you back down into that guidance range that I was mentioning. I guess the one other item is we do have a carbon tax that comes in, which is -- we project to be a $2-a-ton impact because it only comes in for the second half of the year. That's another $1 a ton in that equation. Richard Garchitorena - Crédit Suisse AG, Research Division: Okay, great. And then a follow-up to that. Can you give us any color on where you would see costs going 3 or 4 years out once you've progressed with the expansions, possibly you move forward more with the Macarthur project?

I think it's difficult to look at cost projections too many years out. And when you -- just when you look at factors that are going to impact that, we'll get to steady state both on the existing Australia platform, we've got development projects out of the acquired mine platform. Foreign exchange is always a wild card. We talked in the last quarter call about labor inflation. And what we do is we look to offset that with our increasing volume, better sweating the assets and significant cost containment efforts over the next several periods. Richard Garchitorena - Crédit Suisse AG, Research Division: Great. And then my other question is just broader based. Given the fact that we know that the U.S. market is quite depressed at the moment and probably is going to stay that way for some time and the strength in the Australian business, any updated thoughts in terms of how you can potentially monetize the Australian assets more?

Well, right now, as you know, we're going through a sale process for Wilkie Creek, which has had very, very strong interest in terms of that asset. I think in terms of the rest of the asset base in Australia, our focus right now is to integrate the newly acquired mines, complete the project program that we have for not only the -- our existing operations' expansions but also the new project build within the old Macarthur platform, that being getting Middlemount up to its full capacity and then completing Codrilla. And then we'll watch over time and see how that happens. But given the value in that platform, the substantial value in that platform, we don't have plans to monetize that at this point in time. We're looking at that as a significant component of our growth engine.

Our next question is from Mark Levin with BB&T Capital Markets. Mark A. Levin - BB&T Capital Markets, Research Division: Two questions. The first, as it pertains just to sort of all the Aussie labor issues that are going on right now, specifically with BMA, you mentioned that you settled with North Goonyella. Can you remind us what other labor contracts or try to give us some parameters to think about, like what else is going to happen this year from a labor perspective as it affects Peabody?

Sure. As we entered the year, we had a number of operations that had contracts that needed to be renegotiated this year. For us, the big one was North Goonyella. We also have an agreement at our Wambo underground that we're in the process of discussing with the employees. And we'll hope that a vote there will occur before the end of April or early part of May. A number of our contractor mines also have negotiations. Our Burton operation, Wilpinjong operation and Millennium are all contractor operated, and those individual contractors are in negotiations for labor agreements there as well. So at this point, we're optimistic with having completed North Goonyella, that, that sets a good template for the other operations that we're negotiating. And historically, the contractors that we're using have had very, very good relationships with their union workforce. Mark A. Levin - BB&T Capital Markets, Research Division: Okay, great. And then the follow-up question relates specifically to Wilkie Creek. Obviously, as you mentioned -- you referenced, there'd be a lot of interest in it. Can you maybe give us some parameters in the economics of that mine? Maybe what kind of EBITDA that mine generated last year or at least sort of what the cost structure is and the pricing that you get?

I think all I can really tell you in the middle of the sales process is it's been a good operation for us. Reasons why we decided to monetize Wilkie Creek was it was really sitting outside of what is now our core areas in the New South Wales, Southern New South Wales and Bowen Basin operating regions. Wilkie Creek's a 2.5 million-ton-a-year operation with a potential to grow based on port and rail planned improvements, and it's been a good quality thermal coal moving into the Pacific Rim. And probably, I'll leave it there. Suffice it to say you're -- there has been very strong interest.

And from -- just from an accounting standpoint as it relates to that, it's a discontinued operation. So as you think about the continuing operation information you see in the current and prior periods, they're clean, exclusive of anything related to Wilkie Creek. Mark A. Levin - BB&T Capital Markets, Research Division: Great. Last question has to do with PRB production in 2012. You guys have -- last year, I think the numbers were sort of 470s, 480. Where do you sort of see PRB production landing in 2012? What's your best guess?

Well, suffice it to say PRB will be a contributor to the lower numbers for the U.S. for the year. But I think it's too early to predict exactly where that number and what the component of it is. The -- obviously, significantly down in the last part of March. If you just look at the uncommitted positions that people had, you can come up with a number that's 10%.

And we have time for one more question. It’ll come from the line of David Gagliano with Barclays Capital.

I have 2 quick ones. One, could you -- in the remarks, I did hear something about one of the ways to maintain the NPV was to receive upfront cash payments. And I'm wondering if you could just give us a little more color on that. How much -- can you quantify the total dollar amount of upfront cash payments you received in the first quarter? And how should we expect those to progress over the balance of this year? That's my first question.

As I think -- first off, we talked about anticipated reductions in volume, we talked about the nature of the ways that you can deal with those contract restructurings, which can be a combination of cash payments and/or deferral of volumes or restructuring of volumes for later periods with different prices. So, I mean, just specifically, because it's early days here, we haven't had any significant cash payments relative to the currently reported results.

Okay, that's helpful. And in terms of forward-looking, should we expect like, in terms of material amounts of cash payments? Or is that not...

Typically, they're not material by us. Typically, it's -- the best situation is when we can restructure the contracts, pick up volumes and pricing for the near term, into what I'd say '13 and '14. So I think we've got some ongoing discussions going on, and so we probably ought to not go in any more detail relative to specifics on our restructuring.

Okay. And my last question, what were the Macarthur cash costs in the first quarter?

They were embedded within the costs that we indicated for our Australian platform.

Yes, we won't be separating out the former acquired properties. Those will be reported within the segments on a go-forward basis. But suffice it to say we're maintaining our full year guidance on that cost line.

And Mr. Boyce, I'll turn it back to you for any closing comments.

Well, thank you, operator. I guess in closing, I'd first like to thank Peabody employees for the strong first quarter results and the ongoing actions we're taking to adapt to the changing conditions and markets. It's something we're all watching very closely and staying very nimble, but also thank everybody on the call. We'll continue to execute our plan for '12. We look forward to keeping you apprised and continuing to deliver expected and strong results. So thank you all very much. We'll talk next quarter.

Ladies and gentlemen, that does conclude your conference for today. Thank you for your participation. You may now disconnect.