TIDMATC
RNS Number : 0906I
Atlantic Coal PLC
08 June 2011
This is a correction to RNS announcement 0328I. The only change
is to correct a typographical error in relation to the figure for
the Investment in subsidiary in the Company balance sheet to 31
December 2010. The figure should read $9,923,011 rather than
$9,223,011 as was previously stated.
All other details in the release remain the same. The full text
of the amended announcement is set out below:
Atlantic Coal plc / Index: AIM / Epic: ATC / Sector: Mining
8 June 2011
Atlantic Coal plc ("Atlantic" or the "Company")
Preliminary Results and Notice of AGM
Atlantic Coal plc, the AIM listed open cast coal production and
processing company with activities in Pennsylvania, USA, is pleased
to announce its preliminary results for the year ended 31 December
2010 and to give notice of its AGM to be held at 1 Berkeley Street,
London, W1J 8DJ on 30 June 2011 at 2.30pm.
Overview
-- Increased production capacity at Stockton Colliery
-- 207,873 tons of run-of mine coal mined during 2010
-- Revenues generated during the year of US$10,720,103 (2009:
US$9,048,214)
-- New excavator began on site during the second quarter of the
year resulting in raised production levels
-- Feed rate at the washing plant averaged 1,000 tons per shift,
more than double the 2009 rate capacity of 450 tons per shift
Current year highlights
-- Current production ramping up - on target to produce an
estimated 300,000 tons of run-of-mine coal for 2011
-- Second hydraulic excavator ordered - anticipate becoming
operational during the first quarter of 2012
-- GBP12.3m (before expenses) raised in the first quarter of
2011 giving the Company a healthy cash position
-- Continuing to evaluate potential acquisition targets in line
with strategy to become a regional consolidator
Atlantic Managing Director Stephen Best said, "We are pleased
with the progress made in 2010 and in particular, with the
increased production rates that we have been able to achieve. We
believe that sentiment surrounding the anthracite coal sector
remains buoyant and consider that this bodes well for Atlantic in
2011. Furthermore, with a healthy cash position we believe that we
are well placed to execute our strategy of acting as a regional
consolidator with a view to increasing our resource base. In line
with this, we continue to evaluate potential acquisition targets
and look forward to updating shareholders on our developments."
Chairman's Statement
2010 was an active year for Atlantic during which we increased
production capacity through sustained investment in our primary
asset, the Stockton Colliery ("Stockton"), an opencast anthracite
mining and processing operation in the Pennsylvanian Coal Field,
US, and continued to evaluate potential acquisition targets in line
with our strategy to become a regional consolidator.
Stockton
Stockton, which encompasses an area of approximately 900
hectares located in Hazel Creek, provides the Company with a strong
footprint in Pennsylvania, a prime anthracite region where there is
local demand for our product. In order to improve the mine
economics in the second quarter of 2010, we put a new excavator
into service to develop the current reserves of 3.2 million tons
run-of-mine ("ROM") coal and raise production levels. This had the
desired effect and production for the year was 207,873 tons of ROM
and 2,837,863 bank cubic yards, ("BCYs") of overburden removed
(2009: 232,499 tons ROM and 1,804,435 BCYs) with an additional
125,000 tons produced in the first quarter of 2011, generating
revenues of US$10,720,103 (2009: US$9,048,214), an upward trend
that is continuing. The Company recorded a gross loss for the year
ended 31 December of US$1,980,488 (2009: gross profit US$1,692,860)
and this was mainly as a result of an increase in the Gowen
reclamation charge (US$1,400,000), and of the cyclical nature of
the cut operation which resulted in a higher strip ratio of coal to
overburden due to the operations being nearer to the surface where
less coal is recovered. However with operations in the latter part
of the year and the first quarter of 2011 being in the cut basin,
the ratio decreased, ROM production has increased and we anticipate
that our production profile should continue to gain from the
benefits of this during the course of 2011.
During 2010, feed rate at the washing plant averaged 1,000 tons
per shift, more than double the 2009 rate capacity of 450 tons per
shift.
Current production continues to increase and a second hydraulic
excavator has been ordered which we anticipate will become
operational during the first quarter of 2012.
Additional Opportunities
We are actively looking to expand our portfolio in the
Pennsylvanian Anthracite Field where Stockton is located and
utilise our knowledge of anthracite mining and processing.
Funding
During the course of 2010 we raised GBP1.7 million (before
expenses). Post-period end, in January 2011, we raised GBP300,000
(before expenses) in order to satisfy institutional demand, through
a placing with the Blackrock UK Smaller Companies Fund and then in
February 2011 we completed a further fundraising of GBP12.0 million
(before expenses). These fundraisings have provided us with the
finance required to accelerate the implementation of our mine plan
through the purchase of a new drill rig, truck engine rebuilds and
enable a necessary equipment overhaul to increase production at
Stockton.
Board Changes
During 2010 Greg Kuenzel, John Menzies and Toby Howell stepped
down from the Board to pursue other corporate interests. I would
like to take this opportunity to thank them all for their support
and assistance during a pivotal time in Atlantic's development.
Operations Review
During the year we invested in new equipment, most significantly
a US$3.5 million Liebherr R9250 19.6-yard bucket hydraulic
excavator to enhance excavation capacity and facilitate the
increase of ROM tons supplied to the wash plant. Since it began
operating during the second quarter of 2010, production has
risen.
Following this success, a second Liebherr R9250 19-yard bucket
hydraulic excavator was ordered in April 2011 at a cost of US$3.75
million funded through a conventional lease purchase agreement.
This is scheduled to be operational during the first quarter of
2012 and its arrival will coincide with the completion of
restoration work at the Company's Gowen site, 20km from Stockton,
which will free two Cat 777 trucks and provide additional haul
truck capacity for the two Liebherr excavators
Engine rebuilds on the truck fleet are currently in progress and
will be completed at the rate of one truck every six weeks. Trucks
are taken out of service one at a time in order to facilitate this
process with the minimal possible disruption to operations.
Work on the railroad diversion was deferred during 2009 and 2010
in an effort to preserve working capital. Subsequent to the
February 2011 share placing work on the railway diversion was
restarted and is scheduled to be completed during the third quarter
of 2011.
During 2010 Atlantic mined 207,873 tons of ROM (2009: 232,499)
and removed 2,837,863 BCYs of overburden (2009: 1,804,435). 229,293
tons of ROM was washed which produced 88,597 tons of clean coal
(2009: 81,765). Sales during the year amounted to 97,342 tons
(2009: 74,566). Coal prices during 2010 remained strong and the
Company benefited from the high alternative demand for coking
coal.
In April 2010 we signed a memorandum of understanding ("MOU")
with Xcoal Energy and Resource ("Xcoal"), a private US coal
marketing company, which saw Xcoal agree to purchase up to the
greater of 150,000 tons per year and 50 per cent. of Stockton's
annual anthracite production.
Current Trading
Encouraging production levels have continued into the current
financial year despite adverse weather conditions experienced
throughout the region. For the three months ended 31 March 2011
Atlantic mined 125,148 tons of ROM and removed 658,785 BCYs of
overburden (2010: 17,458 ROM and 651,866 respectively). 62,000 tons
of ROM was washed, which produced 28,846 tons of clean coal (2010:
47,050 ROM and 19,097 tons respectively). In excess of 90,000 tons
of good quality ROM is also currently held as stock. In October
2010 the Company increased weekly working hours to improve
production rates.
Sales for the first quarter of 2011 were 31,238 tons at an
average price of US$134.25 per ton (2010: 97,342 tons and US$113.12
respectively). The Board is optimistic that prices will remain
strong during the second quarter of 2011.
Outlook
2010 was a year of growth for Atlantic, during which our primary
focus was on increasing our production rates. With a strong cash
position we believe that we are well funded to drive growth.
Additionally, we continue to evaluate other properties, both in the
Pennsylvanian Anthracitic Belt and further afield, which we believe
have the potential to be of benefit to the Company.
I look forward to the coming year and achieving our aims of
building a significant multi-project coal company by utilising our
cumulative experience in the resource and corporate sectors.
Finally, I would like to take this opportunity to thank both the
Atlantic shareholders and our dedicated team for their support over
the past 12 months.
Adam Wilson
Chairman
8 June 2011
**ENDS**
For further information on the Company, visit:
www.atlanticcoal.com or contact:
Steve Best Atlantic Coal plc Tel: 020 3328 5670
Nick Naylor Allenby Capital Limited Tel: 020 3328 5656
Alex Price Allenby Capital Limited Tel: 020 3328 5656
Peter Rose FoxDavies Tel: 020 3463 5030
Simon Leathers FoxDavies Tel: 020 3463 5010
Hugo de Salis St Brides Media & Finance Tel: 020 7236 1177
Ltd
Elisabeth Cowell St Brides Media & Finance Tel: 020 7236 1177
Ltd
BALANCE SHEETS
As at 31 December 2010
Group Company
---------------------------- --------------------------
As at 31 As at 31 As at 31 As at 31
December December December December
2010 2009 2010 2009
$ $ $ $
-------------------- ------------- ------------- ------------ ------------
Non-Current Assets
Property, plant and
equipment 6,915,151 4,320,491 2,047 4,197
Land, coal rights
and restoration 7,621,494 7,335,637 - -
Investment in
subsidiary - - 9,923,011 15,659,779
Trade and other
receivables - 201,823 14,368,596 12,427,969
-------------------- ------------- ------------- ------------ ------------
14,536,645 11,857,951 24,293,654 28,091,945
-------------------- ------------- ------------- ------------ ------------
Current Assets
Inventories 1,241,232 1,761,047 - -
Trade and other
receivables 1,310,932 1,093,695 35,318 75,332
Available for sale
financial assets - - - -
Other assets 236,467 236,486 - -
Cash and cash
equivalents 292,433 843,807 83,117 726,015
-------------------- ------------- ------------- ------------ ------------
3,081,064 3,935,035 118,435 801,347
-------------------- ------------- ------------- ------------ ------------
Total Assets 17,617,709 15,792,986 24,412,089 28,893,292
-------------------- ------------- ------------- ------------ ------------
Current Liabilities
Trade and other
payables 4,604,594 3,517,161 436,827 564,212
Borrowings 5,595,593 5,222,749 2,195,857 1,592,800
Accrued restoration
costs 3,256,865 3,732,189 - -
-------------------- ------------- ------------- ------------ ------------
13,457,052 12,472,099 2,632,684 2,157,012
-------------------- ------------- ------------- ------------ ------------
Non-Current
Liabilities
Borrowings 4,665,043 2,864,936 - 637,184
Accrued restoration
costs 3,923,710 2,953,327 - -
-------------------- ------------- ------------- ------------ ------------
8,588,753 5,818,263 - 637,184
-------------------- ------------- ------------- ------------ ------------
Total Liabilities 22,045,805 18,290,362 2,632,684 2,794,196
-------------------- ------------- ------------- ------------ ------------
Net (Liabilities) /
Assets (4,428,096) (2,497,376) 21,779,405 26,099,096
-------------------- ------------- ------------- ------------ ------------
Capital and
Reserves
Attributable to
Equity Holders of
the Company
Called up share
capital 2,394,507 1,804,719 2,394,507 1,804,719
Share premium
account 19,415,088 16,616,252 19,415,088 16,616,252
Merger reserve 15,326,850 15,326,850 11,824,997 17,112,462
Reverse acquisition
reserve (12,999,288) (12,999,288) - -
Other reserves 352,518 263,426 352,518 263,426
Foreign currency
translation
reserve (2,672,814) (2,352,466) (6,975,265) (6,201,159)
Retained earnings /
(losses) (26,244,957) (21,156,869) (5,232,440) (3,496,604)
-------------------- ------------- ------------- ------------ ------------
Total Equity (4,428,096) (2,497,376) 21,779,405 26,099,096
-------------------- ------------- ------------- ------------ ------------
GROUP INCOME STATEMENT
For the year ended 31 December 2010
Group
----------------------------
For the year For the year
ended 31 ended 31
December December
2010 2009
$ $
------------------------------------------- ------------- -------------
Revenue 10,720,103 9,048,214
Cost of sales (12,700,591) (7,355,354)
Gross (loss)/profit (1,980,488) 1,692,860
Administration expenses (2,181,545) (2,298,161)
Other gains/(losses) - net 370,825 (1,124,539)
Other income 17,187 141,848
------------------------------------------- ------------- -------------
Operating Loss (3,774,021) (1,587,992)
Finance income - 21,246
Finance costs (1,317,638) (1,004,926)
Loss Before Taxation (5,091,659) (2,571,672)
Corporation tax expense - -
------------------------------------------- ------------- -------------
Loss for the Year (5,091,659) (2,571,672)
------------------------------------------- ------------- -------------
Attributable to the equity
owners of the Parent (5,091,659) (2,571,672)
------------------------------------------- ------------- -------------
Loss per share attributable to the equity
owners of the Parent during the year:
Basic and diluted 0.31 cents 0.19 cents
All activities are classified as continuing.
GROUP CASH FLOW STATEMENT
For the year ended 31 December 2010
Group
----------------------------
For the For the year
year ended ended 31
31 December December
2010 2009
$ $
----------------------------------------------- ------------- -------------
Cash flows from operating activities
Operating loss (3,774,021) (1,587,992)
Adjustments for:
Depreciation 1,067,976 1,001,142
Amortisation 315,270 348,852
Consultancy fees paid in shares 52,407 -
Share options expensed - 81,071
Accretion, accrued restoration costs 1,718,279 806,106
Reclamation work performed (1,824,347) (1,300,649)
Provision for Doubtful Debts 280,098 -
Profit on sale of assets - (131,342)
Foreign exchange gains (379,142) 1,099,216
(Increase) in trade and other receivables (219,431) (414,676)
Decrease/(Increase) in inventories 519,816 (1,280,856)
Increase / (decrease) in trade and
other payables 928,569 (273,297)
Increase / (decrease) in provisions - (388,377)
Net cash used in operations (1,314,526) (2,040,802)
----------------------------------------------- ------------- -------------
Cash flows from investing activities
Purchase of property, plant and equipment (884,466) (221,049)
Decrease/(increase) in deposits & escrow 19 (6,164)
Loans granted to third parties (100,000) (200,000)
Loan repayments received from third
parties
Purchase of available-for-sale financial
assets 10,000 -
Proceeds from the sale of available-for-sale - (441,827)
financial assets - 1,014,995
Interest paid (203,844) (77,245)
Interest received - 19,451
----------------------------------------------- ------------- -------------
Net cash (used in) from investing activities (1,178,291) 88,161
----------------------------------------------- ------------- -------------
Cash flows from financing activities
Proceeds from issue of share capital 3,217,417 813,087
Transaction costs of share issue (65,947) (33,116)
Proceeds from loans & borrowings 1,206,321 1,840,376
Repayments of borrowings (1,415,219) (156,612)
Borrowing Costs (389,577) -
Interest paid (222,106) -
Finance lease payments (342,516) (65,169)
----------------------------------------------- ------------- -------------
Net cash from Financing Activities 1,988,373 2,398,566
----------------------------------------------- ------------- -------------
Net (decrease) / increase in cash and
cash equivalents (504,444) 445,925
Effect of foreign exchange rate changes (46,930) 70,792
Cash and cash equivalents at beginning
of period 843,807 327,090
----------------------------------------------- ------------- -------------
Cash and cash equivalents at end of
period 292,433 843,807
----------------------------------------------- ------------- -------------
Significant Non-Cash Transactions
On 5 August 2010 the Company issued 50,000,000 ordinary shares
fully paid at 0.5 pence per share in settlement of consultancy fees
and outstanding loans. The aggregate value of these shares was
$310,200 which was calculated with reference to the fair value of
the services rendered and the outstanding loans.
During the year ended 31 December 2010 the Group purchased a new
excavator for the Stockton mine. $2,778,291 of the cost of this
excavator was funded through a finance lease.
COMPANY CASH FLOW STATEMENT
For the year ended 31 December 2010
Company
For the year For the
ended 31 year ended
December 31 December
2010 2009
$ $
----------------------------------------------- ------------- -------------
Cash flows from operating activities
Operating loss (6,535,581) (1,144,866)
Adjustments for:
1,241
Depreciation 2,029 (131,342)
Profit on sale of assets -
Share options expensed - 81,071
Foreign exchange losses (4,443) 3,352
Consultancy fees paid in shares 52,407 -
Provision for doubtful debts 280,098 -
Impairment of investment 5,287,465 -
Decrease/(increase) in trade and other
receivables 37,819 (662)
Decrease in operating payables (41,988) (69,074)
----------------------------------------------- ------------- -------------
Net cash used in operations (1,178,598) (1,260,280)
----------------------------------------------- ------------- -------------
Cash flows from investing activities
Loans to subsidiary (2,625,921) (1,283,782)
Costs repayments received from subsidiary 146,258 -
Interest received - 9
Purchase of property, plant & equipment - (5,225)
Purchase of available-for-sale financial
assets
Proceeds from the sale of available-for-sale - (441,827)
financial assets - 1,014,995
Loan repayments received from third
parties 10,000 -
Loans granted to third parties (100,000) (200,000)
----------------------------------------------- ------------- -------------
Net cash used in investing activities (2,569,663) (915,830)
----------------------------------------------- ------------- -------------
Cash flows from financing activities
Proceeds from issue of share capital 3,217,417 813,087
Transaction costs of share issue (65,947) (33,116)
Borrowing Costs (389,577) -
Interest paid (222,106) -
Repayment of borrowings (850,219) -
Proceeds from borrowings 1,206,321 1,840,376
----------------------------------------------- ------------- -------------
Net cash from Financing Activities 2,895,889 2,620,347
----------------------------------------------- ------------- -------------
Net (Decrease)/Increase in cash and
cash equivalents (595,968) 444,237
Cash and cash equivalents at beginning
of period 726,015 210,986
Effect of foreign exchange rate changes (46,930) 70,792
----------------------------------------------- ------------- -------------
Cash and cash equivalents at end of
period 83,117 726,015
----------------------------------------------- ------------- -------------
Significant Non-Cash Transactions
On 5 August 2010 the Company issued 50,000,000 ordinary shares
fully paid at 0.5 pence per share in settlement of consultancy fees
and outstanding loans. The aggregate value of these shares was
$310,200 which was calculated with reference to the fair value of
the services rendered and the outstanding loans.
Notes to the Financial Statements
Basis of Preparation of Financial Statements
The Financial Statements have been prepared in accordance with
EU-endorsed International Financial Reporting Standards (IFRS) and
International Financial Reporting Interpretations Committee (IFRIC)
interpretations and the parts of the Companies Act 2006 applicable
to companies reporting under IFRS. The Financial Statements have
also been prepared under the historical cost convention other than
financial assets and financial liabilities at fair value through
profit or loss.
The Financial Statements are presented in US Dollars rounded to
the nearest dollar.
Atlantic Coal Plc, the legal parent, is domiciled and
incorporated in the United Kingdom.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of
applying the Group's Accounting Policies. The areas involving a
higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the Financial
Statements are disclosed in Note 2.
This statement was approved by the directors on 8 June 2011.
This statement does not constitute the Group's statutory accounts
for the year ended 31 December 2010. Statutory accounts for the
year ended 31 December 2009 have been delivered to the Registrar of
companies. The auditor's report on those accounts contained an
emphasis of matter in relation to the Group's ability to continue
as a going concern but did not contain any statement under section
495 of the Companies Act 2006. The auditor's report of the accounts
for the year ended 31 December 2010 is expected to be
unqualified.
The Annual report and Notice of AGM for 2010 will shortly be
available to the shareholders and the public on the Company's
website (www.atlanticcoal.com) in accordance with AIM Rule 20.
Segmental Information
Management has determined the operating segments based on
reports reviewed by the Board of Directors that are used to make
strategic decisions. During the year Group had interests in two
geographical segments, the United Kingdom and the United States of
America ("USA"). Activities in the UK are mainly administrative in
nature whilst the activities in the USA relate to coal sales and
production.
The reportable operating segments derive their revenue from the
sale of prepared coal to industrial and retail customers.
For the year ended 31 For the year ended 31 December
December 2010 2009
--------------- ------------ ------------------------------------------ ----------- ------------------------------------------
Intra-segment Intra-segment
USA UK balances Total USA UK balances Total
$ $ $ $ $ $ $ $
--------------- ------------ ------------ -------------- ------------ ----------- ------------ -------------- ------------
Revenue from
external
customers 10,720,103 - - 10,720,103 9,048,214 - - 9,048,214
Gross
profit/(loss) (1,980,488) - - (1,980,488) 1,692,860 - - 1,692,860
Operating
loss (2,521,462) (6,535,581) 5,283,022 (3,774,021) (433,126) (1,144,866) - (1,587,992)
Depreciation 1,065,947 2,029 - 1,067,976 999,901 1,241 - 1,001,142
Amortisation 315,270 - - 315,270 348,852 - - 348,852
Capital
expenditure 3,662,757 - - 3,662,757 247,876 5,225 - 253,101
--------------- ------------ ------------ -------------- ------------ ----------- ------------ -------------- ------------
Total assets 17,497,225 24,412,089 (24,291,605) 17,617,709 14,785,619 28,893,292 (27,885,925) 15,792,986
--------------- ------------ ------------ -------------- ------------ ----------- ------------ -------------- ------------
Total
liabilities 33,781,347 2,632,684 (14,368,226) 22,045,805 27,721,931 2,794,196 (12,225,765) 18,290,362
--------------- ------------ ------------ -------------- ------------ ----------- ------------ -------------- ------------
A reconciliation of operating loss to loss before taxation is
provided as follows:
For the year ended For the year ended
31 December 2010 31 December 2009
$ $
------------------------------------ ------------------- -------------------
Operating loss for reportable
segments (3,774,021) (1,587,992)
Finance income - 21,246
Finance costs (1,317,638) (1,004,926)
Loss before tax (5,091,659) (2,571,672)
------------------------------------ ------------------- -------------------
Information about major customers
Revenues of approximately $1.565 million (2009: $1.738 million)
were derived from a single external customer. These revenues were
all generated in the USA.
Cash and Cash Equivalents
Group Company
---------------------- ----------------------
As at 31 As at 31 As at 31 As at 31
December December December December
2010 2009 2010 2009
$ $ $ $
-------------------------- ---------- ---------- ---------- ----------
Cash at bank and in hand 292,433 843,807 83,117 726,015
-------------------------- ---------- ---------- ---------- ----------
All of the Group's cash at bank is held with institutions with
an AA credit rating.
Loss per Share
The calculation of the basic loss per share of 0.31 cents (31
December 2009 loss per share: 0.19 cents) is based on the loss
attributable to ordinary shareholders of $5,091,659 (31 December
2009 loss: $2,571,672) and on the weighted average number of
ordinary shares of 1,653,929,227 (31 December 2009: 1,321,934,438)
in issue during the year.
The basic and diluted loss per share is the same, as the effect
of the exercise of share options and warrants would be to decrease
the loss per share.
Details of share options and warrants that could potentially
dilute earnings per share in future periods are set out in Note
13.
Since the year end the Company has issued ordinary shares. These
shares will have a dilutive effect on earnings per share in future
periods. Details of the shares issued since the year end are set
out in Note 29.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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