UPDATE 2-Alpha Natural's output cuts start paying off, shares rise

Fri Nov 2, 2012 9:44am EDT
 
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* Says suspended operations at 12 mines this year

* Suspensions to reduce overhead costs by $150 mln

* Avg cost of coal sales per ton falls 14 pct in 3rd quarter

* Says thermal coal market in US has rebounded

* Shares up 9 pct; stock among top percentage gainers on NYSE

By Thyagaraju Adinarayan

Nov 2 (Reuters) - Alpha Natural Resources Inc, the third-largest coal producer in the United States, reported a smaller-than-expected loss as production cuts helped blunt the effect of weak prices, sending its shares up 9 percent.

The company, which supplies thermal coal for power generation and metallurgical coal for making steel, suspended operations at more than 12 mines this year.

These suspensions, which began in September and will continue through early 2013, are expected to reduce annual recurring overhead costs by $150 million, the company said.   Continued...