By Mike Alexieff

September 23, 2017 - Armstrong Energy Inc., owner of Kentucky-based Armstrong Coal, may be filing for bankruptcy protection in the near future.

Calls placed Friday to company headquarters in St. Louis were not returned, and no one at the local office on Brown Road would speak.

However, Ohio County Judge-Executive David Johnston said Friday he's been told a bankruptcy filing is imminent. Armstrong operates four mines in Ohio County, according to its website, and employs around 300 there, Johnston said.

"We're hoping it might have some kind of positive effect," Johnston said, adding that under bankruptcy protection, the company might get relief from paying bills and would be able to increase operations. "I've been told Armstrong thinks they can bounce back."

In Securities and Exchange Commission filings, Armstrong reports it did not make a $11.75 million interest payment on a $200 million loan that was due June 15. In its August quarterly report, the company reported a net loss of $32.6 million for the first six months of the year.

"We have experienced recurring losses from operations, which has led to a substantial decline in cash flows from operating activities," the earning report stated.

"Our current operating plan indicated that we will continue to incur losses from operations and generate negative cash flows from operating activities."

The report goes on to state: "As a result of this, as well as the continued uncertainty around future coal fundamentals, we have concluded there exists substantial doubt regarding our ability to continue as a going concern. ... It may be necessary for us to file a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in order to implement a restructuring, or our creditors could force us into an involuntary bankruptcy or liquidation."

Under Chapter 11, the company could continue to operate, and it has hired a restructuring expert, according to the SEC filings.

Through June, the company mined 2.97 million tons of coal, up from 2.84 million tons in the same period of 2016. However, the average sales price per ton dropped to $40.43 in 2017 from $42.55 the year before.

Experts say low natural gas prices, a competing source of energy for power generation, are hurting the coal industry. In 2016, the two largest coal companies in the United States, Arch Coal and Peabody, filed for bankruptcy.

Armstrong operates the Equality Boot, Lewis Creek, Midway and Kronos mines in Ohio County and the Survant mine in Muhlenberg County, according to its website.