TORONTO,
April 29, 2014 /PRNewswire/ - Pacific
Coal Resources Ltd. (TSXV: PAK) has filed its audited annual
consolidated financial statements for year ended December 31, 2013, together with its management's
discussion and analysis ("MD&A") for the corresponding period.
All financial figures contained herein are expressed in U.S.
dollars unless otherwise noted. The Company intends to file its
2013 annual information form (AIF) on April
30, 2014. These documents will be posted on the Company's
website at www.pacificcoal.ca and under the Company's profile at
www.sedar.com.
Hernan Martinez,
Executive Chairman, commented: '"2013 saw the Company achieve the
strategic objectives we set out in late 2012, with an
ever-decreasing G&A and improvements to the operations at La
Caypa and Cerro Largo, both in terms of stripping ratio and
operating costs per tonne produced. This is evident in the
Company's Adjusted EBITDA, which increased from a loss of
$30.7 million in 2012 to earnings of
$2.4 million in 2013. Looking back,
I'd like to see 2013 as the turning point for the Company and we
are excited for what it is to come. In 2014, we will be working to
further reduce costs and maximize production efficiency to make our
core assets profitable."
Financial and Operating Summary
A summary of the financial and operating results
for the fourth quarter and full year of 2013 is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000's except per share and operating data) |
|
|
|
Fourth Quarter |
|
|
|
Year Ended December 31 |
|
|
|
2013 |
|
|
2012 |
|
|
|
2013 |
|
|
2012 |
Operational |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tonnes of coal produced |
|
|
|
299,378 |
|
|
274,756 |
|
|
|
1,317,088 |
|
|
1,268,082 |
Average stripping ratio - operations |
|
|
|
11.06:1 |
|
|
11.11:1 |
|
|
|
9.31:1 |
|
|
10.71:1 |
Tonnes of coal sold |
|
|
|
243,847 |
|
|
304,165 |
|
|
|
1,170,716 |
|
|
1,270,114 |
Average realized thermal coal price per tonne
sold(1) |
|
|
$ |
94.52 |
|
$ |
99.96 |
|
|
$ |
101.26 |
|
$ |
98.22 |
Operating margin per tonne sold (1) |
|
|
$ |
(7.33) |
|
$ |
(12.90) |
|
|
$ |
7.49 |
|
$ |
(13.57) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
|
$ |
23,047 |
|
$ |
30,401 |
|
|
$ |
119,237 |
|
$ |
129,055 |
Adjusted EBITDA (1) |
|
|
|
(3,444) |
|
|
(6,083) |
|
|
|
2,417 |
|
|
(30,747) |
Earnings (loss) from operations |
|
|
|
(5,419) |
|
|
(58,180) |
|
|
|
1,483 |
|
|
(137,374) |
Net earnings(loss) attributed to shareholders
(2) |
|
|
|
(460) |
|
|
(49,868) |
|
|
|
7,460 |
|
|
(123,752) |
Basic and fully diluted income (loss) per share
(3) |
|
|
$ |
(0.01) |
|
$ |
(1.08) |
|
|
$ |
0.15 |
|
$ |
(2.69) |
Cash |
|
|
|
235 |
|
|
4,102 |
|
|
|
235 |
|
|
4,102 |
Total assets |
|
|
|
265,138 |
|
|
242,047 |
|
|
|
265,138 |
|
|
242,047 |
Total debt (4) |
|
|
$ |
53,316 |
|
$ |
58,584 |
|
|
$ |
53,316 |
|
$ |
58,584 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Adjusted EBITDA, average realized thermal coal price per tonne
sold and operating margin per tonne sold are non-GAAP finance
performance measures, none of which have standardized definitions
under IFRS. See pages 22-23 of the Company's 2013
MD&A for further details. |
(2) |
|
The net loss for the fourth quarter of 2012 included a $39.2
million and $8.5 million impairment of Cerro Largo and Jam
operations, respectively. The net loss for the year ended December
31, 2012 includes an $8.1 million impairment of the Company's
Barranquilla port concession and a $74.8 million impairment of
Cerro Largo. |
(3) |
|
At a special meeting held on March 11, 2013, the Company's
shareholders approved a share consolidation, in which seven old
common shares of the Company were exchanged for one new common
share. |
(4) |
|
Total debt includes bank indebtedness, long-term debt, finance
leases and interest accruing on the Norcarbon S.A.S. amounts owed
to Masering S.A.S. (December 31, 2013 - $18.0 million, 2012 - $27.6
million). |
|
|
|
2013 Highlights
- Coal production: The Company produced 299,378
tonnes of coal in the fourth quarter of 2013 for a total of
1,317,088 tonnes in 2013, representing an increase of 9% and 4%
from the fourth quarter of 2012 (274,756 tonnes) and 2012 total
(1,268,082 tonnes), respectively. The Company's operational
stripping ratio of 9.31:1 in 2013 represented a decrease of 13%
from 2012 (10.71:1).
- Revenues: Coal revenues for the fourth quarter of
2013 were $23.0 million - 243,847
tonnes of coal sold at an average realized price of $94.52 per tonne. Total coal revenues in 2013 of
$118.6 million reflect sales of
1,170,716 tonnes of coal at an average realized price of
$101.26 per tonne. The average
realized price of coal sold in 2013 represented a 3% increase over
2012 ($98.22).
- Earnings from operations: Earnings from
operations for the fourth quarter and year ended December 31, 2013 were a loss of $5.4 million and earnings of $1.5 million respectively, compared to a loss of
$58.2 million and a loss of
$137.4 million in 2012. The
earnings from operations for the year ended December 31, 2013 was the highest the Company has
ever recorded, and can be attributed to the favourable domestic
sales contracts and continued Company-wide cost and expense
reductions, in addition to the port impairment reversal recognized
in the year.
- Adjusted Earnings Before Interest, Taxes, Depreciation
and Amortization ("EBITDA") and operating margin: Adjusted
EBITDA for the year ended December 31,
2013 was $2.4 million, a
significant improvement over a loss of $30.7
million in the year ended of December
31, 2012. The total operating margin for the year
ended December 31, 2013 on a per
tonne sold basis was $7.33. See
'Non-GAAP and Additional GAAP Financial Measures' for a definition
and reconciliation of Adjusted EBITDA and operating margin per
tonne sold.
- Operational and strategic changes: In
October and November 2013, the
Company signed sale agreements for $29.0
million for 85% of the Barranquilla port. In
September 2013, the Company signed a
contract with the purpose of implementing a pilot project for La
Caypa's underground mine. The Company also signed a rental
agreement for use of its coke plant in August 2013. In January
2014, an agreement was entered into for the operation of the
Cerro Largo mine.
- General and administrative ("G&A") expenses:
The Company recorded $6.3 million in
G&A expenses in the year ended December
31, 2013, compared to $13.5
million in 2012, a reduction of 53%. Actual G&A expenses
were also 15% lower than the $7.5
million initially forecast for 2013. G&A of
$1.7 million in the fourth quarter of
2013, was 25% lower than the corresponding quarter in 2012
($2.2 million). The Company
anticipates a quarterly G&A run rate of approximately
$1.4 million in 2014.
Outlook
The Company concluded 2013 with a bright outlook
on the future after making significant progress on the goals set at
the beginning of the year. Management implemented its
strategic and operational plans in the first half of 2013 as part
of the Company's re-focus on core competencies. Operationally, the
re-focus was evident as the Company's Adjusted EBITDA increased
from a loss of $30.7 million in 2012
to earnings of $2.4 million in
2013. The goal of making the operating mines profitable,
specifically Cerro Largo, will continue to be a focus of the
Company in 2014.
Strategically, significant progress was made in
completing two goals set by senior management: determining the
future of the Barranquilla port concession, and eliminating the
debt owed to the former operator of Cerro Largo. First, in
October and November 2013 the Company
signed sale agreements for $29
million relating to 85% of the Barranquilla port
concession. The Company currently retains the remaining 15%
of the concession, although the Company is currently exploring
options to sell this interest. Second, in November 2013 the Company's subsidiary Norcarbon
signed a settlement agreement with the former operator at Cerro
Largo, with proceeds from the Barranquilla port concession sale
going towards settling the total balance owed.
In terms of operational plans, management was
able to exceed the 2013 cost cutting goal, with annual G&A
expenses of $6.3 million compared to
the initial forecast of $7.5
million. This is also significantly lower than the
$13.5 million recorded in 2012.
The Company has set a new cost cutting goal, forecasting 2014
G&A expenses at $5.5 million.
At La Caypa, although the change in operator
during the first quarter of 2013 negatively impacted production
earlier in the year, the Company was still able to fulfill its 2013
production and financial goals for La Caypa mine.
Financially, the mine achieved an operating margin of $14.4 million in 2013, compared to being
breakeven in 2012. In terms of production, the mine produced 1.0
million tonnes of coal in 2013, consistent with the forecast and a
12% increase over the production results of 2012. The Company
continues to solidify the mine's future as the original main pit
nears the end of its life, by signing a contract with an
experienced miner in September 2013
for an underground mine pilot project and production from La
Caypa's south pit commencing in November
2013. The underground miner is currently completing a
pilot project of approximately 40,000 tonnes of coal, which began
at the end of February 2014, with the
goal of contracting all of the underground mining if the pilot
project is successful. Full production of the underground
mine would commence in 2015. The Company is anticipating the south
pit to be at full operation by the second quarter of 2014.
The Company is forecasting open pit production of 1.05 million
tonnes and underground production of 40,000 tonnes of thermal coal
from La Caypa in 2014. This would represent an 8% production
increase from 2013.
The Company commenced its plan for
self-operation of the Cerro Largo mine in April 2013 but re-focused the plan late in the
year, deciding to use a new third party as the operator of Cerro
Largo. In January 2014, an
agreement with a third party was signed. The Company had always
planned to use some third-party assistance for some of the mine's
operational requirements, beginning by signing a two-year contract
for the transportation of mine waste materials in September 2013. Management is forecasting
production of 507,000 tonnes of thermal coal from Cerro Largo in
2014. This would represent a 70% increase from the tonnes
produced in 2013.
In February 2014,
the Company signed a letter of intent with a third party to perform
analysis of the results of asphaltite exploration at the La Tigra
property and additional exploration if desired, at the third
party's cost, to determine the site's prospects. The third party's
exploration period will conclude at the end of October 2014, although they can elect to extend
the period by six months.
About Pacific Coal Resources Ltd.
Pacific Coal Resources Ltd. is a
Canadian-based mining company engaged in the acquisition,
exploration and production of coal and coal-related assets from
properties located in Colombia.
The Company's common shares and warrants are listed on the TSX
Venture Exchange and trade under the symbol "PAK" and "PAK.WT"
respectively.
Forward Looking Information:
This news release contains "forward-looking
information", which may include, but is not limited to, statements
with respect to the future financial or operating performance of
the Company and its projects. Often, but not always,
forward-looking statements can be identified by the use of words
such as "plans", "expects", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates", or believes" or
variations (including negative 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 statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of Pacific Coal to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements.
Forward-looking statements contained herein are made as of the date
of this press release and Pacific Coal disclaim, other than as
required by law, any obligation to update any forward-looking
statements whether as a result of new information, results, future
events, circumstances, or if management's estimates or opinions
should change, or otherwise. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, the reader is
cautioned not to place undue reliance on forward-looking
statements.
Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined
in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this
news release.
SOURCE Pacific Coal Resources Ltd.