Press Releases

Peabody Energy today announced that it expects to record a one-time $10 million after-tax charge and $38 million income tax benefit to fourth quarter 2002 earnings, both of which were not included in prior earnings targets.

  -- An adverse U.S. Supreme Court ruling was received today regarding
     health care beneficiaries previously assigned to Peabody Coal Company
     and Eastern Associated Coal Corp., two Peabody units, by the Social
     Security Administration.  The decision will result in an after-tax
     fourth quarter charge of approximately $10 million, or $0.19 per share.

     The ruling overturns a U.S. Court of Appeals decision in June 2001 that
     the Social Security Administration had improperly assigned
     approximately 300 beneficiaries to the units under the Coal Act, which
     resulted in the Social Security Administration withdrawing these
     assignments.  This litigation, discussed in the company's filed
     financial documents, had been ongoing since 1999.  As a result of the
     ruling, Eastern Associated and Peabody Coal will be responsible for the
     health care premiums of a defined group of retirees, who last worked
     with the units prior to 1976, and their beneficiaries.

  -- Peabody expects to record an income tax benefit of approximately
     $38 million, or $0.70 per share, in the fourth quarter primarily due to
     recognition of previously reserved net operating loss carryforward
     benefits that were used to offset taxable gains on property sales in
     the fourth quarter.

Peabody Energy is the world's largest private-sector coal company, with 2001 sales of 194 million tons of coal and $2.6 billion in revenues. Its coal products fuel more than 9 percent of all U.S. electricity generation and more than 2 percent of worldwide electricity generation.

SOURCE: Peabody Energy