CanAm Coal Corp. (TSX VENTURE:COE) (OTCQX:COECF) ("CanAm" or the "Company") has
filed its unaudited condensed interim consolidated financial statements and
related management's discussion and analysis for the three and six month period
ended July 31, 2011. Copies of these documents may be obtained via the SEDAR
website.
With the primary focus of the Company on growing coal production and resources,
the main activities of the CanAm team in the second quarter were devoted to
successfully completing and integrating the 50% acquisition of Birmingham Coal &
Coke ("BCC"). BCC operates 3 mines and a brokerage business in Alabama with coal
sales of approximately 40,000 to 50,000 tons per month. The Company was
successful on both counts and delivered record production, revenue, income and
EBITDA from mining operations.
"We successfully completed the purchase and integration of a 50% ownership stake
in BCC and as such, our second quarter includes, for the first time, the full
contribution of our share of their production and results", said Jos De Smedt,
CFO of CanAm. "All of our key metrics; production, revenue and EBITDA from
mining operations; saw a minimum five-fold increase as compared to prior year's
second quarter. We delivered $7.5 million of revenue, $1.9 million of EBITDA
from mining and generated $2.6 million of cash flow from operations during the
quarter. Our cash position significantly improved with cash on hand of $5.7
million, including $1.6 million of restricted cash, at July 31, 2011".
Highlights and events for the second quarter include:
-- Achieved coal sales of 81,453 tons in Q2 or an increase of 69,139 tons
from last year's second quarter and an increase of 50,798 tons from the
previous quarter.
-- Achieved coal sales of 112,108 tons for the first half of fiscal 2012 or
a fivefold increase from last year;
-- Generated revenue of $7.5 million in Q2 as compared to $1.4 million in
Q2 of last year;
-- Topped $10 million in revenue for the first half of fiscal 2012 as
compared to $2.6 million last year;
-- Generated EBITDA from mining operations of $1.9 million for Q2 as
compared to $0.3 million last year and topped $3 million for the first
half of fiscal 2012 as compared to $0.5 million last year;
-- Delivered average EBITDA from mining of $23/ton for the quarter and
$27/ton for the first half of fiscal 2012;
-- Generated cash from operations of $2.6 million in Q2 as compared to a
use of cash from operations of $0.1 million last year;
-- Improved the overall financial position of the Company. Cash on hand and
working capital at July 31, 2011 amounted to $5.7 million, including
$1.6 million of restricted cash, and $0.4 million, respectively;
-- Recorded a one-time charge in Q2 of fiscal 2012 relating to BCC
acquisition expenses in the amount of $0.5 million and a non-cash charge
of $0.3 million related to 2.4 million broker warrants issued as a
result of the 9.5% debenture financing;
-- Completed a NI 43-101 independent reserve report for BCC which
determined the coal resource at 6 million tons of proven reserves. On
this basis, and considering current production levels, average mine life
for the BCC mines is 10 years;
-- Started trading on the US OTC market, OTCQX International, under the
symbol COECF.
Highlights and events subsequent to the quarter ended July 31, 2011 include:
-- Converted approximately $0.75 million of the 12% convertible debenture
debt into common shares and raised additional funds as a result of the
exercise of warrants and options for proceeds of approximately $200,000.
Financial results for the three and six month period ended July 31 were as follows:
Three Month Period Six Month Period
----------------------------------------------------------------------------
Ended July 31 Ended July 31
----------------------------------------------------------------------------
2011 2010 2011 2010
----------------------------------------------------------------------------
Revenue 7,474,506 1,434,064 10,707,627 2,558,801
----------------------------------------------------------------------------
Income from mining
operations 686,903 216,408 1,579,727 394,392
----------------------------------------------------------------------------
Profit (loss) before tax (i) (1,343,478) 29,358 (990,499) 22,356
----------------------------------------------------------------------------
Net profit (loss) (1,274,219) 6,389 (1,046,615) (18,664)
----------------------------------------------------------------------------
EBITDA from mining
operations 1,864,549 288,109 3,045,010 495,060
(i) includes $0.8 M of one-time expenses relating to the BCC acquisition &
debenture financing
Mine operating results for the three and six month period ended July 31 were as
follows:
Three Month Period Six Month Period
----------------------------------------------------------------------------
Ended July 31 Ended July 31
----------------------------------------------------------------------------
2011 2010 2011 2010
----------------------------------------------------------------------------
Mettalurgical coal 10,830 10,027 30,028 18,366
----------------------------------------------------------------------------
Thermal coal 70,623 2,287 82,080 3,898
----------------------------------------------------------------------------
Total 81,453 12,314 112,108 22,264
----------------------------------------------------------------------------
Coal sales revenue 7,474,506 1,368,789 10,707,627 2,463,885
----------------------------------------------------------------------------
Income from mining
operations 686,903 216,408 1,579,727 394,392
----------------------------------------------------------------------------
EBITDA from mining
operations 1,864,549 288,109 3,045,010 495,060
----------------------------------------------------------------------------
Coal sales (in tons) 81,453 12,314 112,108 22,264
----------------------------------------------------------------------------
Average coal price 92 111 96 111
----------------------------------------------------------------------------
Average cost of product sold 53 68 50 67
----------------------------------------------------------------------------
Average cost of royalties
----------------------------------------------------------------------------
transportation and other 16 25 18 25
----------------------------------------------------------------------------
Average income from mining 8 18 14 18
----------------------------------------------------------------------------
Average EBITDA from mining 23 23 27 22
----------------------------------------------------------------------------
Notes:
-- Averages are all presented on a per ton basis.
-- Through November 8, 2010, the Company only owned 49% of the mining
operations and therefore for the second quarter ended July 31, 2010, all
numbers represent CanAm's proportionate 49% share.
-- EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization
is a supplemental measure that is not presented in accordance with
International Financial Reporting Standards (IFRS). This non-IFRS
measure may not be comparable to the calculation of similarly titled
measures reported by other companies and should not be considered in
isolation, as an alternative to, or more meaningful than financial
measures calculated and reported in accordance with IFRS.
Coal Sales
Coal sales were 81,453 tons in the second quarter of fiscal 2012 as compared to
12,314 tons in Q2 of fiscal 2011 or an increase of 69,139 tons. The significant
increase is mainly the result of the first time contribution of 59,069 tons of
coal sales from BCC's three operating mines; Bear Creek, Old Union and Gooden
Creek. Coal sales at the Powhatan mine were up 6,865 tons from the comparable
period in the previous year. The ratio of metallurgical/thermal coal at the
Powhatan mine was 56/44% as a result of higher recovery rates from the Mary Lee
coal seam.
For the six month period ended July 31, 2011, coal sales were 112,108 tons as
compared to 22,264 tons in fiscal 2011 or a fivefold increase. The ratio of
metallurgical/thermal coal for the six month period ended July 31, 2011 at the
Powhatan mine was 60/40% as compared to 82/18% in the first half of fiscal 2011.
Revenue, Income and EBITDA from Mining Operations
Revenue, income and EBITDA from mining operations for the quarter were all up
significantly as compared to the prior period as a result of the increased
production following the acquisition of a 50% ownership stake in BCC and
improved pricing on both metallurgical and thermal coal. Although prices for
both coals increased quarter over quarter, the average coal price was lower due
to the Company's coal mix of 13/87% metallurgical/thermal coal as compared to
81/19% in the comparable prior period. The major shift in the coal mix is
primarily due to the BCC acquisition which only mines high quality thermal coal.
For the quarter, the Company realized an average sales price of $92/ton as
compared to $111/ton in fiscal 2011. Production costs for the quarter were on
average $53/ton as compared to $68/ton in fiscal 2011 with the decrease mainly
coming from the lower production costs at the BCC mines. EBITDA from mining
operations was $1,864,549, as compared to $288,109 in the second quarter of
fiscal 2011.
For the six month period ended July 31, 2011, the Company exceeded $10 million
in revenue and $3 million in EBITDA from mining operations and changes from the
prior year are mainly the result of the BCC acquisition.
Revenue, income and EBITDA from mining operations were negatively impacted from
the strengthening of the Canadian dollar. Average exchange rate for the first
half of fiscal 2012 was US$1=CDN$0.9620 as compared to US$1=CDN$1.0368 in the
comparable prior period.
Other Income (Expenses)
Other expenses for the three and six month period ended July 31, 2011 were
$2,030,381 (2011 - $187,050) and $2,570,226 (2011 - 372,036), respectively. The
increase for the quarter was mainly the result of: one-time expenses associated
with the acquisition of BCC and the related debenture financing (+$772,000),
higher general and administrative expenses as a result of the increased activity
in the Company's operations and additional overhead following the acquisitions
of BCC and RAC (+$379,000), interest and costs associated with the Company's
9.5% and 12% debenture which were not in place in fiscal 2011 (+$554,000),
higher stock based compensation expenses (+$83,000) and higher equipment
interest expense as a result of the BCC acquisition (+$54,000).
The Company's overall financial position improved as a result of the cash flow
generated from mining operations and funds raised through the 9.5% convertible
debenture. Cash on hand at July 31, 2011 was $4.1 million as compared to $1.5
million at January 31, 2011. In addition, the Company held $1.6 million in
restricted cash as security for reclamation bonds. The Company continued its
investment in its mining operations in Alabama and capital expenditures,
excluding the BCC acquisition, for the first half of fiscal 2012 were
approximately $0.5 million.
Outlook
Since November 2009, the Company has embarked on a strategy to become an
emerging coal producer and in the last year the Company has successfully
completed two acquisitions: gaining control of RAC Mining LLC, a predominantly
metallurgical coal producer, and acquiring a 50% ownership stake in Birmingham
Coal & Coke Inc., a predominantly thermal coal producer. As a result, CanAm's
assets now comprise an ownership stake in:
-- 4 producing surface coal mines
-- 1 development mine
-- Permits and leases covering approximately 5,000 acres of land
-- Workforce of 110+ employees
With the acquisition of BCC completed, the Company is estimating coal sales of
between 300,000 to 325,000 tons for fiscal 2012 (ending January 31, 2012). The
Company also believes that it will continue to benefit from a strong pricing
environment as a result of the high quality of both its metallurgical and
thermal coal and existing off-take contracts for some of its metallurgical coal
and the majority of its thermal coal. In addition, the Company is looking to
organically grow its production in Alabama by increasing its existing capacity
and adding adjacent land positions to its portfolio. The Company also has an
option to purchase an additional 30% ownership in BCC within the next 2 years
and the remaining 20% within 5 years.
In addition, the Company continues to pursue the development of the Buick Coal
Property which holds significant coal resources, 188 million tons of indicated
and 103 million tons of inferred coal resources, in Colorado, USA (see the
technical report entitled "Limon Lignite Project, Elbert County, Colorado, USA,"
dated October 26, 2007 and filed on SEDAR on November 2, 2007).
About CanAm Coal Corp.
CanAm is a coal producer and development company focused on growth through the
acquisition, exploration and development of coal resources and resource-related
technologies. CanAm's main activities and assets include its four operating coal
mines in Alabama, the exclusive rights to a proprietary Coal to Liquids
technology which converts coal into liquid fuels (such as oil, jet fuel) at an
economical cost with zero airborne emissions and the Buick Coal Project which
holds significant coal resources, 188 million indicated and 103 million inferred
resources, in Colorado, USA (see the technical report entitled "Limon Lignite
Project, Elbert County, Colorado, USA," dated October 26, 2007 and filed on
SEDAR on November 2, 2007). Other coal and related opportunities continue to be
evaluated on an ongoing basis.
Forward-Looking Information and Statements
This press release contains certain forward-looking statements and
forward-looking information (collectively referred to herein as "forward-looking
statements") within the meaning of applicable Canadian securities laws. All
statements other than statements of present or historical fact are
forward-looking statements. Forward-looking statements are often, but not
always, identified by the use of words such as "could", "should", "can",
"anticipate", "estimate", "expect", "believe", "will", "may", "project",
"budget", "plan", "sustain", "continues", "strategy", "forecast", "potential",
"projects", "grow", "take advantage", "well positioned" or similar words
suggesting future outcomes. In particular, this press release contains
forward-looking statements relating to: the future production of the Powhatan
mine; the permitting of the Davis mine; and the potential production at the
Davis mine. This forward looking information is based on management's estimates
considering typical strip mining operations, equipment requirements and
availability and typical permitting timelines.
In addition, forward-looking statements regarding the Company are based on
certain key expectations and assumptions of the Company concerning anticipated
financial performance, business prospects, strategies, the sufficiency of
budgeted capital expenditures in carrying out planned activities, the
availability and cost of services, the ability to obtain financing on acceptable
terms, the actual results of exploration projects being equivalent to or better
than estimated results in technical reports or prior exploration results, and
future costs and expenses being based on historical costs and expenses, adjusted
for inflation, all of which are subject to change based on market conditions and
potential timing delays. Although management of the Company consider these
assumptions to be reasonable based on information currently available to them,
these assumptions may prove to be incorrect.
By their very nature, forward-looking statements involve inherent risks and
uncertainties (both general and specific) and risks that forward-looking
statements will not be achieved. Undue reliance should not be placed on
forward-looking statements, as a number of important factors could cause the
actual results to differ materially from the Company's beliefs, plans,
objectives and expectations, including, among other things: general economic and
market factors, including business competition, changes in government
regulations or in tax laws; the early stage development of the Company and its
projects; general political and social uncertainties; commodity prices; the
actual results of current exploration and development or operational activities;
changes in project parameters as plans continue to be refined; accidents and
other risks inherent in the mining industry; lack of insurance; delay or failure
to receive board or regulatory approvals; changes in legislation, including
environmental legislation, affecting the Company; timing and availability of
external financing on acceptable terms; conclusions of economic evaluations; and
lack of qualified, skilled labour or loss of key individuals. These factors
should not be considered exhaustive. Many of these risk factors are beyond the
Company's control and each contributes to the possibility that the
forward-looking statements will not occur or that actual results, performance or
achievements may differ materially from those expressed or implied by such
statements. The impact of any one risk, uncertainty or factor on a particular
forward-looking statement is not determinable with certainty as these risks,
uncertainties and factors are interdependent and management's future course of
action depends upon the Company's assessment of all information available at
that time.
Forward -looking statements in respect of the future production of the Powhatan
and BCC mines may be considered a financial outlook. These forward-looking
statements were approved by management of the Company on September 28, 2011. The
purpose of this information is to provide an operational update on the company's
activities and strategies and this information may not be appropriate for other
purposes.
The forward-looking statements contained herein are expressly qualified in their
entirety by this cautionary statement. The forward-looking statements included
in this press release are made as of the date of this press release and the
Company does not undertake and is not obligated to publicly update such
forward-looking statements to reflect new information, subsequent events or
otherwise unless so required by applicable securities laws.
Benz Capital (TSXV:BCC)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
Benz Capital (TSXV:BCC)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024
