Apr. 16--Higher-priced coal contracts helped Peabody Energy Corp. triple first-quarter profit. But even amid a recession, those earnings disappointed Wall Street, sending the coal producer's shares lower.

The St. Louis-based company also announced further reduction of 2009 production goals in response to weakened energy markets amid a global economic downturn.

"These actions are needed to assist customers and avoid a prolonged market dislocation beyond 2009," Richard A. Navarre, Peabody's president, said in a statement.

Peabody executives said additional output cuts were necessary given the severity and duration of the recession and the impact on customers.

Globally, steel production is down 23 percent this year; 50 percent in the United States. And electricity consumption is poised to decline in consecutive years for the first time since the government began keeping data 60 years ago.

Net income rose to $170 million, or 63 cents a share, from $57 million, 21 cents in the same period a year ago, the company said.

Coal shipments fell slightly to 59.6 million tons, reflecting already announced output cuts, a late spring blizzard that affected a large mine in Wyoming and deferred customer shipments in Australia, Peabody said.

Revenue rose 15 percent to $1.46 billion on higher realized coal prices from contracts signed before the recession hammered energy markets. Coal prices have declined since then in sympathy with demand for fuel to produce electricity and steel.

Excluding a gain from an excise tax refund related to the 2007 spin-off of Patriot Coal Corp., Peabody earned 50 cents a share vs. 28 cents a share on the same basis a year ago. Analysts surveyed by Thomson Reuters, however, expected earnings of 94 cents a share in the current quarter.

Peabody shares fell $3.38, or 11.5 percent, to $25.96 on the New York Stock Exchange.

Last month, Peabody announced it was closing a small Illinois mine where recoverable coal reserves were exhausted. It also announced plans for a large new mine in Indiana and related long-term sales contracts that will deliver almost $6 billion in revenue.

Peabody Chief Executive Gregory H. Boyce said the company would continue to scour the globe for bargain assets as well as review its own operations for efficiency as the company tries to weather the economic storm.

"We continue to conduct stem-to-stern reviews of all our operations to make sure they are the low cost and/or high margin producers in each market," he said.

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