Forbes Coal reports first quarter 2012 run of mine production of 311,000 tonnes, a 45 pct increase over three months ended February 28, 2011

Forbes & Manhattan Coal Corp. (TSX:FMC)(JSE:FMC) (“Forbes Coal” or the “Company”) is pleased to announce its first quarter financial results for the three months ended May 31, 2011. All figures are in Canadian dollars, unless otherwise stated.

First Quarter Financial Highlights:

  • Revenue of $19.6 million
  • Gross profit of $4.2 million
  • Consolidated EBITDA of $5.6 million and Slater Stand Alone EBITDA of $6.2 million (see non- GAAP measures)
  • Cash and cash equivalents of $19.8 million

The average monthly revenue for the first quarter 2012 was $6.5 million. In fiscal 2011, from the date of acquisition to February 28, 2011 (a seven month period), average monthly revenue was $3.9 million. This represents a 65% increase in average monthly revenue.

Production and sales also showed significant growth. Total ROM production from all operations for first quarter 2012 was 311,000 tonnes, 45% higher than total ROM production for the three months ended February 28, 2011. Average combined monthly sales were 63,600 tonnes, 14% higher than average combined monthly sales for the three months ended February 28, 2011. First quarter average combined monthly sales were 44% higher than average combined monthly sales for Slater Coal’s fiscal 2011.

“The growth in revenue is a result of the increased export sales and steady ramp up at the Magdalena and Aviemore mines. Management expects this trend to be maintained as Forbes Coal continues to sell in the expanding Asian coal markets,” said Stephan Theron, President and Chief Executive Officer. “Management also expects Forbes Coal to raise its domestic profile though its recent listing on the Johannesburg Stock Exchange.”

Operational highlights

  • Forbes Coal continued to increase production at its two mines, Magdalena and Aviemore. The Company launched Project Siyathuthuka (Zulu for “together we are growing and improving”), the second phase of its ramp-up programme. Operational highlights include:
  • ROM Production
  • Total ROM production from all operations for first quarter 2012 was 311,000 tonnes, 45% higher than total ROM production for the three months ended February 28, 2011.
  • Magdalena produced 260,300 tonnes ROM underground and open pit combined.
  • Average monthly ROM production at Magdalena increased to 86,800 tonnes from 58,200 tonnes, a 49% improvement from the three months ended February 28, 2011 monthly averages. When compared to Slater Coal’s fiscal 2011 monthly averages Magdalena monthly ROM production increased 33%.
  • ROM production at Aviemore for the first quarter 2012 was 50,700 tonnes.
  • Average monthly ROM at Aviemore for first quarter 2012 was 16,900 tonnes. This is a 29% improvement from Aviemore’s average monthly production for the three months ended February 28, 2011. When compared to average ROM production for Slater Coal’s fiscal 2011, first quarter 2012 monthly production was slightly lower than the average monthly ROM production at Aviemore.

Saleable Production and Sales

  • Saleable coal production for first quarter 2012 was 207,200 tonnes. The total calculated yield from plant feed was 66.6% in this period.
  • Total sales of bituminous coal, anthracite and calcined products from first quarter 2012 were 190,800 tonnes.
  • Average combined monthly sales were 63,600 tonnes, 8% higher than average combined monthly tonnes sold for the three months ended February 28, 2011. First quarter average combined monthly tonnes sold were 44% higher than average combined monthly tonnes sold for
  • Slater Coal’s fiscal 2011.
  • Export sales for first quarter 2012 were 91,900 tonnes, 3% higher than average quarterly tonnes sold for the three months ended February 28, 2011 and 83% higher than average quarterly tonnes sold for Slater Coal’s fiscal 2011.
  • Domestic sales in the first quarter of 2012 were 99,000 tonnes, a 14% increase when compared to the three months ended February 28, 2011. When compared to Slater Coal’s fiscal 2011 quarterly averages, domestic tonnes sold increased 34%.
  • Forbes Coal transported 133,900 tonnes of saleable product to the Navitrade port during first quarter 2012, and shipped 78,400 tonnes during this time.
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