| Tue 18 Oct 2011, 13:00 | | FMC - Forbes & Manhattan Coal Corp - Forbes Coal Revenue increases 80% to |
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FMC
FMC
FMC - Forbes & Manhattan Coal Corp - Forbes Coal Revenue increases 80% to
$35.2 million in second quarter 2012 as a result of record export sales
Forbes & Manhattan Coal Corp.
(Registration number: 002116278)
(External company registration number: 2011/011661/10)
Share code on the Toronto Stock Exchange: FMC
Share code on the JSE Limited: FMC
ISIN: CA3451171050
FORBES COAL REVENUE INCREASES 80% TO $35.2 MILLION IN SECOND QUARTER 2012
AS A RESULT OF RECORD EXPORT SALES
Slater Coal Year over Year EBITDA Increased 109% to $9.2 million (stand
alone)
TORONTO, ONTARIO - October 18, 2011: Forbes & Manhattan Coal Corp.
(TSX/JSE: FMC) ("Forbes Coal" or the "Company") is pleased to announce its
second quarter 2012 financial results for the three months ended August
31, 2011 (References to Q1 2012 or the first quarter 2012 mean the three
months ended May 31, 2011. References to Q2 2012 or the second quarter
2012 mean the three months ended August 31, 2011.)
Second Quarter Financial Highlights: (All figures are in Canadian dollars,
unless otherwise stated)
Second Quarter First %
2012 Quarter 2012 Increase
(June - August (March - May
2011) 2011)
Revenue $35.2 million $19.6 + 80 %
million
Gross profit $5.6 million $4.2 million + 34 %
Consolidated EBITDA $6.9 million $5.8 million + 19 %
(see non-GAAP
measures)
Slater Stand Alone $9.2 million $6.2 million + 48 %
EBITDA
(see non-GAAP
measures)
Cash and cash $24.2 million $19.8 + 22 %
equivalents million
The sharp increase in revenue is a direct result of the Company`s record
export sales in the second quarter of 2012. Total export sales in the
second quarter of 2012 were 192,400 tonnes, a 109% increase compared to
first quarter 2012 export sales of 91,800 tonnes. Fiscal year-to-date
export sales are 284,200 tonnes.
Slater stand alone EBITDA for the quarter increased by 109% from $4.4
million to $9.2 million year over year.
"The quarter`s results further highlight the excellent progress that we
have made at an operational level. Phase Two of production ramp up at
Magdalena and Aviemore is well underway. The second continuous miner at
Magdalena is currently being commissioned. Bituminous and anthracite coal
prices remain steady, even in an uncertain global economic environment,"
said Stephan Theron, President and Chief Executive Officer. "This quarter
also marked the first time that total export sales were greater than total
domestic sales and we expect this trend to continue."
Fiscal year-to-date figures are: Revenue of $54.9 million; Gross Profit of
$9.8 million; Consolidated EBIDTA of $12.7 million; Slater Stand Alone
EBIDTA of $15.4 million.
* Operational highlights
Production at Forbes Coal`s two mines, Aviemore and Magdalena, continues
to increase on plan and on budget. Commissioning of the second phase of
expansion at Magdalena is on track for the third quarter of 2012 with the
new Continuous Miner underground and in the process of being commissioned.
Operational highlights include:
ROM Production
ROM production at Aviemore in the second quarter of 2012 was 64,200
tonnes, an increase of 27% compared to the 50,700 tonnes produced in the
first quarter of 2012. Fiscal year- to -date ROM production at Aviemore
was 114,900 tonnes.
Production at Magdalena remained consistent in the second quarter of 2012.
ROM production in Q2 2012 was 258,600 tonnes compared to 260,300 tonnes in
Q1 2012. Fiscal year- to- date ROM production at Magdalena was 518,900
tonnes.
Total ROM production in the second quarter of 2012 was 322,800 tonnes, a
4% improvement compared to the 311,000 tonnes of total ROM production in
the first quarter of 2012. Fiscal year- to- date total ROM production was
633,800 tonnes.
Saleable Production and Sales
Saleable production at Aviemore was 39,100 tonnes in the second quarter of
2012, an increase of 23% compared to the 31,800 tonnes produced in the
first quarter of 2012. Fiscal year- to- date saleable production at
Aviemore was 70,900 tonnes.
Saleable production at Magdalena was 179,600 tonnes compared to 175,400
tonnes in the second quarter of 2012. Fiscal year-to-date saleable
production at Magdalena was 355,000 tonnes.
Total saleable production in the second quarter of 2012 was 218,700
tonnes, a 6% improvement compared to the 207,200 tonnes of total saleable
production in the first quarter of 2012. Fiscal year-to-date total sales
production was 425,900 tonnes.
Total export sales in the second quarter of 2012 was 192,400 tonnes, a
109% increase compared to first quarter 2012 export sales of 91,900
tonnes. Fiscal year-to-date total export sales was 284,300 tonnes.
Total domestic sales in the second quarter of 2012 was 147,400 tonnes, a
49% increase compared to the first quarter 2012 domestic sales of 99,000
tonnes. Fiscal year- to -date total domestic sales were 246,400 tonnes.
Total sales in the second quarter of 2012 was 339,800 tonnes, a 78%
increase compared to first quarter 2012 total sales of 190,800 tonnes.
Fiscal year-to-date total sales was 530,600 tonnes.
Saleable product transported to the Navitrade port in second quarter 2012
was 155,500 tonnes, an increase of 89% compared to the first quarter 2012.
Total saleable product transported to Navitrade for fiscal year-to-date
2012 was 237,600 tonnes.
Coal dispatched through Navitrade to overseas markets in second quarter
2012 was 167,500, an increase of 114% compared to 78,000 dispatched in
first quarter 2012. Total coal dispatched through Navitrade to overseas
markets for fiscal year-to-date 2012 was 245,500 tonnes.
Stock at the Navitrade terminal at the end of the second quarter 2012 was
34,900 tonnes.
SUMMARIZED FINANCIAL RESULTS OF SLATER COAL
Summarized Financial Results (Actual)
Slater Coal
Three months ended Six months ended
August 31, August 31, August 31, August 31,
2011 2010 2011 2010
Run of Mine 322,765 232,218 633,767 429,962
(ROM) (t)
Saleable 218,724 164,927 425,913 299,903
production
(t)
Plant feed 327,744 235,209 630,813 442,568
(t)
Yield (%) on 67.8% 71.0% 67.2% 69.8%
ROM
Yield (%) on 66.7% 70.1% 67.5% 67.8%
Plant feed
Inventory 204,396 107,145 189,778 86,742
tonnes
balance open
Inventory 82,425 129,269 82,425 129,269
tonnes
balance close
Sales (t) 339,802 142,803 530,629 257,376
Revenue 35.2 12.2 54.9 21.9
000,000`s ($)
EBITDA 9.2 4.4 15.4 7.7
000,000`s ($)
CDN$: US$ 0.97 1.04 0.97 1.03
(average)
ZAR: CDN 7.09 7.19 7.07 7.25
(average)
Selling price 103.59 85.24 103.37 85.09
(average) /
sold
production t
(CAD$)
Selling price 106.54 81.85 106.55 82.61
(average) /
sold
production t
(US$)
Cash cost of 24.1 8.0 36.6 13.8
sales and
operating
expenses CAD
000,000`s ($)
Cash cost of 70.92 56.36 68.96 53.62
sales and
operating
expenses/sold
production t
(CDN$)
Cash cost of 72.94 54.12 71.09 52.06
sales and
operating
expenses/sold
production t
(US$)
Capital 2.30 1.01 3.97 2.71
expenditures
000,000`s
(CAD$)
Capital 10.51 6.12 9.32 9.04
expenditures
per t of
saleble
production $
Numbers in
this chart
are derived
from the
Slater Coal
stand alone
financial
statements.
See non GAAP
measures.
(*) The Slater Coal results presented in the chart above for the three and
six months ended August 31, 2010 have not been reported in the
consolidated financial statements of the Company in full. Only results for
a period from the date of acquisition (July 29, 2010) have been
consolidated. Also the comparative period for reporting purposes is the
three months ended September 30 2010.
NON-GAAP PERFORMANCE MEASURES
The Company has included in this document certain non-GAAP performance
measures that are detailed below. These non-GAAP performance measures do
not have any standardized meaning prescribed by GAAP and, therefore, may
not be comparable to similar measures presented by other companies. The
Company believes that, in addition to conventional measures prepared in
accordance with GAAP, certain investors use this information to evaluate
the Company`s performance. Accordingly, they are intended to provide
additional information and should not be considered in isolation or as a
substitute for measures of performance prepared with GAAP. The definition
of these performance measures and reconciliation of the non-GAAP measures
to reported GAAP measures are as follows:
EBITDA - Forbes Coal consolidated
Three months Six months
ended ended
August 31, August 31,
2011 2011
$000`s $000`s
Net income (loss) for the (1,421) (2,426)
period
add back
Amortization and depletion 5,520 8,448
Income tax expense 2,190 3,068
Foreign exchange gain/loss (236) 72
Interest and dividend income 209 521
Accretion 528 1,065
Business combination 3 22
transaction costs
Stock based compensation 92 1,932
EBITDA Forbes Coal 6,885 12,702
Consolidated
EBITDA - Slater Coal stand alone
Three months Six months
ended ended
August 31, August 31,
2011 2011
$000`s $000`s
Net income (loss) for the (1,421) (2,426)
period
add back
Amortization and depletion 5,520 8,448
Income tax expense 2,190 3,068
Foreign exchange gain/loss (236) 72
Interest and dividend income 209 521
Accretion 528 1,065
Business combination 3 22
transaction costs
Stock based compensation 92 1,932
General and administration 2,273 2,705
(Non Slater)
EBITDA Slater Coal 9,158 15,407
About Forbes Coal
Forbes Coal is a growing coal producer in southern Africa. It holds a
majority interest in two operating mines through its 76.75% interest in
Slater Coal (Pty) Ltd., a South African company ("Slater Coal") which has
a 70% interest in Zinoju Coal (Pty) Ltd. ("Zinoju"). Zinoju holds a 100%
interest in the Magdalena bituminous mine and the Aviemore anthracite mine
in South Africa (collectively, "the Slater Properties"). The mines have a
resource of 51.7 million tonnes of bituminous and 50.8 million tonnes of
anthracite coal and each mine has a projected life span in excess of 20
years. Forbes Coal is in the process of increasing production at both
mines and looks to triple production from 2010 levels in the next three
years using existing infrastructure and capacity. The Company has in-place
transportation infrastructure allowing its coal to reach both export
corridors and the growing domestic coal market. Forbes Coal has a strong
balance sheet and an experienced coal-focused management team.
Please refer to the Company`s NI 43-101 compliant technical report on the
Slater Coal Properties dated March 1, 2011 entitled "Technical Report on
Slater Coal and Subsidiaries, KwaZulu-Natal Province, South Africa",
available on the SEDAR profile of the Company at www.sedar.com. Additional
information is available at www.forbescoal.com.
Johan Odendaal, B.Sc.(Geol.), B.Sc.(Hons)(Min. Econ.), M.Sc. (Min. Eng.),
a director of Minxcon and an independent Qualified Person, as defined in
National Instrument 43-101 has reviewed and approved the scientific and
technical information contained in this release.
Cautionary Note Regarding Forward-Looking Information This press release
contains "forwardlooking information" within the meaning of applicable
Canadian securities legislation. Forwardlooking information includes, but
is not limited to, statements with respect to the anticipated production
results at the Slater Properties, future financial or operating
performance of the Company and its projects, statements regarding
transportation, infrastructure and the prospects for the business of the
Company, requirements for additional capital, government regulation of the
mineral exploration industry, environmental risks, acquisition of mining
licences, title disputes or claims, limitations of insurance coverage and
the timing and possible outcome of pending litigation and regulatory
matters. Generally, forwardlooking information can be identified by the
use of forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes", or
variations of such words and phrases or state that certain actions, events
or results "may", "could", "would", "might" or "will be taken", "occur" or
"be achieved". Forward-looking information is subject to known and
unknown risks, uncertainties and other factors that may cause the actual
results, level of activity, performance or achievements of the Company to
be materially different from those expressed or implied by such forward-
looking information, including but not limited to: general business,
economic, competitive, foreign operations, political and social
uncertainties; a history of operating losses; delay or failure to receive
board or regulatory approvals; timing and availability of external
financing on acceptable terms; not realizing on the potential benefits of
the proposed transaction; conclusions of economic evaluations; changes in
project parameters as plans continue to be refined; future prices of
mineral products; failure of plant, equipment or processes to operate as
anticipated; accidents, labour disputes and other risks of the mining
industry; and, delays in obtaining governmental approvals or required
financing or in the completion of activities. Although the Company has
attempted to identify important factors that could cause actual results to
differ materially from those contained in forward-looking information,
there may be other factors that cause results not to be as anticipated,
estimated or intended. There can be no assurance that such information
will prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forwardlooking information. The
Company does not undertake to update any forward-looking information,
except in accordance with applicable securities laws.
FOR FURTHER INFORMATION PLEASE CONTACT:
Stephan Theron Sabina Srubiski
President and Chief Executive Officer Investor Relations Manager
+1 (416) 861-5912 +1 (416) 309 2957
Email: stheron@forbescoal.com Email: ssrubiski@forbescoal.com
18 October 2011
Sponsor:
Sasfin Capital a division of Sasfin Bank Limited
Date: 18/10/2011 13:00:02 Produced by the JSE SENS Department.
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