Forbes Coal: Labour Disruption Resolved
16 November 2012 - 11:00PM
Marketwired
Forbes & Manhattan Coal Corp. (TSX:FMC)(JSE:FMC) has resolved
the wage-related labour disruption at its mines. Operations at the
Magdalena and Aviemore mines as well as the coal processing plants
in South Africa, will resume on Monday, November 19, 2012. Forbes
Coal and the employees involved have agreed to an average wage
increase of 14.8%.
Forbes Coal President and Chief Executive Officer Stephan Theron
comments, "management is pleased to have agreed on a settlement
with the employees, in the interests of all stakeholders.
Operations are set to resume early next week. Management is
committed to maximizing production in the current and next quarter
in order to meet the revised 2013 targets".
Forbes Coal suffered production losses during the labour
disruption, which will have an impact on the current quarter and
the full year, summarized as follows:
-- The run of mine (ROM) loss of production will be approximately 256,000
tonnes for the third quarter; 55% lower than the forecast of 463,000
tonnes;
-- The tonnes sold for the third quarter is expected to be approximately
94,000 tonnes, 63% lower than the forecast of 257,000 tonnes.
As a result of the labour disruption, the ROM production target
of 1.7 million tonnes for fiscal 2013 (ending February 28, 2013)
has been adjusted to 1.3 million tonnes. The ROM revised production
estimate for the year is broken down as follows: Aviemore
underground 387,000 tonnes; Magdalena underground 658,000 tonnes;
and Magdalena opencast 287,000 tonnes.
The company also estimates that fourth quarter sales will be
lower as a result of weaker coal pricing globally.
About Forbes Coal
Forbes Coal is a growing coal producer in southern Africa. It
holds a majority interest in two operating mines through its 100%
interest in Forbes Coal (Pty) Ltd., a South African company
("Forbes Coal Dundee") 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 Forbes Coal Dundee Properties"). The
mines have a substantial resource base 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 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. In September
2012, Forbes's Coal agreed to acquire 100% ownership of Riversdale
Mining from Rio Tinto. As a result of the acquisition, Forbes Coal
will acquire a current producing anthracite mine in the Zululand
Anthracite Colliery ("ZAC"). ZAC is thought to be one of the last,
large-scale producers of high-quality anthracite product in South
Africa, with historic run of mine production of 700,000 tonnes of
coal per annum over the last five years. The Acquisition scales
Forbes Coal's annual production capacity to an estimated 2.5
million tonnes.
Forbes Coal has a strong balance sheet and an experienced
coal-focused management team and board of directors.
Cautionary Notes
The ability of the Company to increase production amounts has
not been the subject of a feasibility study and there is no
certainty that the proposed expansion will be economically
feasible.
This press release contains "forward-looking information" within
the meaning of applicable Canadian securities legislation.
Forward-looking information includes, but is not limited to,
statements with respect to anticipated production results with
respect to the Forbes Coal Dundee Properties, future financial or
operating performance of the Company and its projects, statements
regarding the anticipated improvements in logistical support and
anticipated improvements in sales, statements made with respect to
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, forward-looking 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 forward-looking information. The Company does not
undertake to update any forward-looking information, except in
accordance with applicable securities laws.
Contacts: Forbes & Manhattan Coal Corp. Stephan Theron
President and Chief Executive Officer +1 (416)
861-5912stheron@forbescoal.com Forbes & Manhattan Coal Corp.
Samantha Thomson Investor relations Manager +1 (416)
309-2957sthomson@forbescoal.com