RNS Number : 3750W
ATH Resources plc
10 June 2008
Press Release 10 June 2008
The following release replaces the Interim Results announcement released today at 07:00am under RNS number 3149W
In the Chairman's statement, the Group stated that the interim dividend will be payable on the 17 July 2008 to registered holders on 25
June 2008. The statement should have stated that the interim dividend will be payable on the 17 July 2008 to registered holders as at the 27
June 2008.
The statement remains unchanged in all other respects.
A full copy of the amended release appears below.
ATH Resources plc
("ATH" or "the Group")
Interim Results
ATH Resources plc, one of the UK's largest coal producers, reports its Interim Results for the six months ended 30 March 2008.
Highlights
* Turnover of �28.1 million (2007: �31.2 million) on sales of 787,000
tonnes of coal (2007: 973,000 tonnes)
* Average selling price increased by more than 10% to �35 per tonne
* Profit before tax of �0.4 million (2007 restated: �2.7 million)
* Earnings per share of 0.8 pence (2007 restated: 4.6 pence)
* Proposed interim dividend maintained at 3.36p per share
* ATH Regeneration preferred bidder on 12 million tonnes tailings washing
project in Queensland, Australia
* Planning consents at Muir Dean and Grievehill mines deliver a 70%
increase in Proven Reserves to 6 million tonnes*
* Grievehill and Muir Dean mines now operational
* Strong coal market results in significant increase in value of coal
reserves
Commenting on the Interim Results, Tom Allchurch, Chief Executive of ATH, said:
"The results for the period, as expected, reflect lower production from our Grievehill mine whilst we were waiting for the final
planning consent for an extension to the site. It is pleasing to report that both Grievehill and the new Muir Dean site are now open, which
will drive a significant increase in volumes for the second half. With favourable pricing set to continue, I am confident that results for
the full year will be in line with market expectations.
The last six months have seen a number of developments for ATH which will be important to the future prospects of the Group. Successful
planning applications increased our Proven Reserves from 3.5 million tonnes to 6 million tonnes and the confirmation of ATH Regeneration as
preferred bidder on a 12 million tonne tailings washing project in Queensland is a major breakthrough in opening up the Australian market to
our unique coal tip washing process."
- Ends -
For further information:
ATH Resources plc
Tom Allchurch, Chief Executive Tel: +44 (0) 1302 760 462
tom.allchurch@ath.co.uk www.ath.co.uk
Evolution Securities Limited
Joanne Lake/Peter Steel Tel: +44 (0)113 243 1619
joanne.lake@evosecurities.com www.evosecurities.com
Media enquiries:
Abchurch
Charlie Jack / George Parker Tel: +44 (0) 20 7398 7700
george.parker@abchurch-group.com www.abchurch-group.com
CHAIRMAN'S STATEMENT
Trading results
Turnover in the six months to 30 March 2008 was �28.1 million (2007: �31.2 million) on sales of 787,000 tonnes (2007: 973,000) tonnes.
Profit before tax was �0.4 million (2007 restated: �2.7 million) with a net cash inflow from operations of �6.4 million (2007 restated:
�10.1 million). Earnings per share were 0.8 pence (2007 restated: 4.6 pence).
The results reflect a reduction in coal sales compared with the previous period, due primarily to lower coal production from the
Grievehill surface mine in East Ayrshire. The site, as previously notified, was out of production for a number of months pending final
planning approval of the latest 1 million tonne extension. The site is now once again fully operational.
The surface mining business is currently expanding production capacity at Grievehill and Muir Dean, as planned, with the delivery of new
mining equipment. This will contribute to the recovery of sales volumes for the full year to over 2 million tonnes, around the level for
2007.
Average selling prices increased by over 10%, reflecting a strong international market for coal. This market will drive higher average
selling prices for ATH in the second half as mining production increases. Operating costs continue to be carefully monitored and
successfully controlled. Oil price rises resulted in an increase in the cost of gas oil, a significant component of the cost base, however
the Directors are confident this cost increase can be absorbed given the strength of the coal market and the current hedging strategy.
ATH Regeneration, the land regeneration and coal recovery business, continues to operate the Grimethorpe site until the summer when, as
planned, the Group will commence final restoration of the site.
Development - UK
Following a successful appeal to the Scottish Executive, final planning approval was obtained for the commencement of mining at Muir
Dean in Fife, adding 2.3 million tonnes of coal to Proven Reserves. Grievehill received planning consent for an additional 1.0 million
tonnes following the design of an innovative soil strip and restoration programme to maintain the local habitat. A further 0.6 million
tonnes was also added to Probable Reserves from an additional extension identified at the Skares Road site, with a planning decision
expected later in 2008.
The development of a 0.5 million tonne coal washing site at Langton by ATH Regeneration progressed well during the period and consent to
operate the site is expected within the next three months, with plant build and operations commencing later in the year. ATH Regeneration is
pursuing a number of other opportunities in the UK, either to acquire the rights to the coal for recovery or provide tip washing to third
parties. In addition to the Langton site, the Directors anticipate the construction of two further plants in the UK during 2009.
Proven Reserves increased by 70% to 6.0 million tonnes at the period end, with a further 2.4 million tonnes of Probable Reserves.
Development - Australia
The Group continues to advance opportunities for ATH Regeneration to utilise its coal recovery expertise in Australia. Several projects
are being actively pursued and the Directors are confident that the technology will be successfully introduced into this large coal
producing market to provide significant growth for the business in the medium term.
The Group is pleased to announce that ATH has been confirmed as preferred bidder for a project in Queensland to wash 12 million tonnes
of coal tailings, anticipated to commence in 2009. The project, which is subject to final approval by the client, is for an initial three
years and would be carried out under contract to one of the major global mining organisations. The proposal provides for ATH Regeneration
to build and operate a wash plant under an index linked contract, with the client responsible for the marketing and transport of the coal.
ATH Regeneration is also commencing the exploration and analysis of a separate coal tailings tip on a mine owned by another major mining
organisation in Australia, with a view to negotiating a contract to recover the coal from the tip. The Directors believe that these two
projects will pave the way for a growing number of coal tip washing projects in Australia.
Financing
The Group refinanced its borrowing facilities during the period to reflect the long term planning and operational profile of its UK
business. Existing loan facilities were replaced by �15 million of senior debt and a further �8 million facility to finance the opening of
the Muir Dean site.
On the basis of the strength of the existing business and the anticipated returns from the projects, the Directors intend to maintain
the Group's dividend policy for the full year.
Dividends
The Directors are proposing an interim dividend of 3.36p per share, unchanged from 2007. The dividend will be paid on 17 July 2008 to
registered holders on 27 June 2008.
Outlook
Demand for coal remains strong, with international prices continuing to increase from already record levels, more than doubling over the
last year. The forward price index indicates average prices over the next three years exceeding US$120 per tonne.
Much of the current coal output, in total 4 million tonnes, supplies long term contracts with UK power generators. These contracts
benefit from price certainty but are, on average, �25 to �30 per tonne below prices the business might expect to obtain on new long term
contracts in the current market. In addition to this contracted tonnage, the Group has further non-contracted coal reserves of around 4
million tonnes, including 2.3 million tonnes from the Muir Dean site, and the Directors expect the Group to benefit significantly over time
from higher coal prices for this and future new coal reserves.
The strength of the coal market is also expected to support the growth of ATH Regeneration, as it becomes increasingly economic to wash
coal tip sites and provide land owners with sustainable environmental improvements to their sites.
Coal is set to remain a significant source of energy production within the world and UK economies and ATH is well placed with its
existing coal assets, expertise and projects under development to deliver additional value to shareholders.
David Port
Non-executive Chairman
10 June 2008
* The information in this report relating to exploration results, mineral resources or mineral reserves is based on information compiled
by Mr Peter Morgan, a full-time employee of the company, who is a fellow of the Institute of Materials, Minerals and Mining. Mr Morgan has
sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration. He has reviewed and consents
to the inclusion in the report of the matters based on his information in the form and context in which it appears. A glossary of terms is
available on our website - www.ath.co.uk.
Condensed consolidated income statement
for the six months ended 30 March 2008
Unaudited Unaudited Reviewed
six months six months year
ended ended ended
30 March 1 April 30 September
2008 2007 2007
Continuing operations �000 �000 �000
Revenue 28,062 31,231 70,508
Cost of sales (21,886) (23,442) (50,856)
Gross profit 6,176 7,789 19,652
Other operating income 125 22 129
Administrative expenses (4,658) (4,175) (8,725)
Operating profit 1,643 3,636 11,056
Finance costs (1,199) (979) (2,425)
Profit before taxation 444 2,657 8,631
Taxation (122) (850) (2,767)
Profit for the period 322 1,807 5,864
Basic earnings per share 0.80p 4.55p 14.76p
Diluted earnings per share 0.78p 4.49p 14.53p
The profit on ordinary activities before taxation arises from the Group's continuing activities.
There are no recognised gains and losses other than as stated in the income statement.
Condensed consolidated balance sheet
as at 30 March 2008
Unaudited Unaudited Reviewed
30 March 1 April 30 September
2008 2007 2007
�000 �000 �000
ASSETS
Non current assets
Goodwill 7,169 7,366 7,169
Property, plant and equipment 68,689 69,171 64,356
Investments - 1 1
75,858 76,538 71,526
Current assets
Inventories 11,346 7,621 7,793
Trade and other receivables 6,995 9,331 11,229
Cash and cash equivalents - - 64
18,341 16,952 19,086
Total assets 94,199 93,490 90,612
LIABILITIES
Current liabilities
Trade and other payables (8,470) (9,480) (10,181)
Tax liabilities (193) (1,681) (712)
Bank overdraft (1,510) (10,147) (8,158)
Bank loans (4,409) (4,284) (2,747)
Obligations under finance leases (7,600) (7,602) (7,418)
(22,182) (33,194) (29,216)
Non-current liabilities
Trade and other payables (50) - (175)
Bank loans (13,709) (1,277) (753)
Obligations under finance leases (11,998) (16,389) (12,539)
Final void provision (13,046) (11,984) (12,223)
Deferred tax liabilities (3,603) (1,734) (3,603)
(42,406) (31,384) (29,293)
Total liabilities (64,588) (64,578) (58,509)
Net assets 29,611 28,912 32,103
Equity
Share capital 200 198 199
Share premium 27,855 27,341 27,563
Share-based payment reserve 1,508 1,068 1,313
Retained earnings 48 305 3,028
Total equity 29,611 28,912 32,103
Condensed consolidated statement of changes in equity
for the six months ended 30 March 2008
Called up share Share premium Share-based payment Retained earnings Total equity
capital account reserve �000 shareholders' funds
�000 �000 �000 �000
At 1 October 2006 198 27,341 853 1,630 30,022
Issue of ordinary shares 1 222 - - 223
Profit for the year - - - 5,864 5,864
Dividends paid - - - (4,466) (4,466)
Addition to share-based
payment reserve - - 460 - 460
At 30 September 2007 199 27,563 1,313 3,028 32,103
At 1 October 2006 198 27,341 853 1,630 30,022
Profit for the period - - - 1,807 1,807
Dividends paid - - - (3,132) (3,132)
Addition to share-based - - 215 - 215
payment reserve
At 1 April 2007 198 27,341 1,068 305 28,912
At 30 September 2007 199 27,563 1,313 3,028 32,103
Issue of ordinary shares 1 292 - - 293
Profit for the period - - - 322 322
Dividends paid - - - (3,302) (3,302)
Addition to share - - 195 - 195
based-payment reserve
At 30 March 2008 200 27,855 1,508 48 29,611
Condensed consolidated cash flow statement
for the six months ended 30 March 2008
Unaudited Unaudited Reviewed
six months six months year
ended ended ended
30 March 1 April 30 September
2008 2007 2007
Notes �000 �000 �000
Cash flows from operating
activities
Cash generated from operations 5 6,436 10,059 23,580
Interest paid (1,414) (994) (2,184)
Tax paid (642) (4,226) (5,234)
Net cash from operating 4,380 4,839 16,162
activities
Cash flows from investing
activities
Proceeds from sale of property, 3 350 352
plant and equipment
Interest received 55 15 23
Government grant received - 1,847 1,847
Purchases of property, plant (5,415) (6,831) (8,967)
and equipment
Acquisition of subsidiary - (708) (1,000)
Net cash used in investing (5,357) (5,327) (7,745)
activities
Cash flow from financing
activities
Dividends paid (3,302) (3,132) (4,466)
Repayment of borrowings (3,664) (724) (2,784)
Payment of finance lease (4,048) (4,567) (8,248)
liabilities
Proceeds from the issue of 293 - 223
share capital
New bank loans raised 18,282 1,602 1,602
Net cash used in financing 7,561 (6,821) (13,673)
activities
Net increase/(decrease) in cash 6,584 (7,309) (5,256)
and cash equivalents
Cash and cash equivalents at (8,094) (2,838) (2,838)
beginning of period
Cash and cash equivalents at (1,510) (10,147) (8,094)
end of period
Notes to the interim report
for the six months ended 30 March 2008
1 Basis of preparation
For accounting periods from 1 October 2007, the Group is required to present its financial statements in accordance with International
Financial Reporting Standards ("IFRS") adopted for use in the EU ("adopted IFRS"). This interim report has therefore been prepared using
accounting policies consistent with adopted IFRS with the exception of IAS 34, which is not mandatory for AIM listed businesses. These
accounting policies are set out in the announcement "2007 IFRS Restatement" dated 15 April 2008 available on the Group's website
www.ath.co.uk.
The comparative figures for the financial year ended 30 September 2007 and the six months ended 1 April 2007 have been restated to
comply with adopted IFRS, and the "2007 IFRS Restatement" includes reconciliations between the results under UK Generally Accepted
Accounting Practices ("UK GAAP") and IFRS.
The information for the year ended 30 September 2007 does not constitute statutory accounts as defined in Section 240 of the Companies
Act 1985. A copy of the accounts for that year, which were prepared under UK GAAP, have been delivered to the Registrar of Companies. The
auditors' report on those financial statements was unqualified and did not contain any statement under Section 237 (2) or (3) of the
Companies Act 1985.
The Group has drawn up its accounts for the 26 week period ended 30 March 2008 (2007: 26 weeks to 1 April 2007), and these accounts are
unaudited. The auditors issued an unqualified special purpose audit opinion on the restated financial information for the year ended 30
September 2007 in the "2007 IFRS Restatement".
The interim report was approved by the Board of Directors on 9 June 2008.
2 Earnings per share
Basic earnings per share is calculated by reference to the weighted average number of ordinary shares in issue during the period of
40,049,557 (1 April 2007: 39,693,568; 30 September 2007: 39,728,508) and the profit for the period. The diluted earnings per share takes
account of share options outstanding to employees as set out below:
Unaudited Unaudited Reviewed
six months six months year
ended ended ended
30 March 1 April 30 September
2008 2007 2007
Weighted average number of shares in 40,049,557 39,693,568 39,728,508
issue
Weighted average number of dilutive 1,269,671 550,714 619,714
share options
Total number of shares for calculative 41,319,228 40,244,282 40,348,222
diluted earnings per share
3 Taxation
Taxation for the six months ended 30 March 2008 has been shown at the rate estimated to be applicable for the full year.
4 Dividends
Unaudited Unaudited Reviewed
six months six months year
ended ended ended
30 March 1 April 30 September
2008 2007 2007
�000 �000 �000
Declared and paid during the financial
period
Final dividend for the year ended 1
October 2006: 7.89 pence per share - 3,132 3,132
Interim dividend for the year ended 30
September 2007: 3.36 pence per share - - 1,334
Final dividend for the year ended 30
September 2007: 8.24 pence per share 3,302 - -
3,302 3,132 4,466
Proposed after the balance sheet date
and not recognised as a liability
Final dividend for the year ended 30
September 2007 : 8.24 pence per share - - 3,285
Interim dividend for the year ended 30
September 2007: 3.36 pence per share - 1,334 -
Interim dividend for the year ended 28
September 2008: 3.36 pence per share 1,347 - -
1,347 1,334 3,285
5 Reconciliation of operating profit to net cash generated from operations
Unaudited Unaudited Reviewed
six months six months year
ended ended ended
30 March 1 April 30 September
2008 2007 2007
�000 �000 �000
Operating profit 1,643 3,636 11,056
Depreciation of property, plant and 5,719 6,533 13,648
equipment
Loss/(profit) on disposal of fixed 1 (11) 58
assets
Share based payment expense 195 215 460
Increase in inventories (3,553) (859) (1,031)
Decrease/(increase) in receivables 4,234 (1,025) (2,433)
(Decrease)/increase in payables and (1,803) 1,570 1,822
provisions
Net cash generated from operations 6,436 10,059 23,580
6 Analysis of net debt
Unaudited Unaudited Reviewed
six months six months year
Ended ended ended
30 March 1 April 30 September
2008 2007 2007
�000 �000 �000
Cash and cash equivalents and bank (1,510) (10,147) (8,094)
overdraft
Debt due within one year (4,409) (4,284) (2,747)
Debt due beyond one year (13,709) (1,277) (753)
Finance leases and hire purchase (19,598) (23,991) (19,957)
contracts
(39,226) (39,699) (31,551)
7 Reconciliation of net cash flow to movement in net debt
Unaudited Unaudited Reviewed
six months six months year
ended ended ended
30 March 1 April 30 September
2008 2007 2007
�000 �000 �000
Increase/(decrease) in cash in the 6,584 (7,309) (5,256)
period
Cash inflow from increase in debt and 7,712 3,690 11,032
lease financing
Change in net debt resulting from cash 14,296 (3,619) 5,776
flow
New finance leases and hire purchase (3,689) (3,029) (4,276)
contracts
New loans (18,282) (1,602) (1,602)
Movement in net debt in the period (7,675) (8,250) (102)
Net debt brought forward (31,551) (31,449) (31,449)
Net debt carried forward (39,226) (39,699) (31,551)
8 Copies of the interim report
Copies of the interim report will be posted to shareholders in due course and are available from the Company's Head Office
at: Aardvark House, Sidings Court, Doncaster DN4 5NU or by visiting the Company's website www.ath.co.uk.
This information is provided by RNS
The company news service from the London Stock Exchange
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