[miningmx.com] — TORONTO and Johannesburg listed Forbes Coal reported a doubling in first quarter revenue owing to higher sales and an improved coal price.
The company holds a majority interest in two operating mines through its 76.75% interest in Slater Coal, a South African company which has a 70% interest in Zinoju Coal.
Zinoju holds a 100% interest in the Magdalena bituminous mine and the Aviemore anthracite mine – both in KwaZulu-Natal.
Collectively these are referred to as the Slater Properties.
Revenue for the three months to end May was C$19.6m compared to C$9.7m in the same three months of 2010 while pretax earnings was C$6.2m versus C$3.3m previously.
Run-of-mine production at 311,002 tonnes was 45% up on last year’s 197,744 tonnes after the ramp up of production at two of its mines.
Saleable production grew to 207,189 tonnes from 134,976 tonnes while the company achieved sales of 190,827 compared to 114,573 tonnes.
“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 Forbes president and CEO, Stephan Theron.
“Management also expects Forbes Coal to raise its domestic profile though its recent listing on the Johannesburg Stock Exchange,” he said.
Just before its JSE listing the company said it was looking to triple production from 2010 levels in the next three to four years using existing infrastructure and capacity.
The Magdalena bituminous coal operation and the Aviemore anthracite coal operations are both in Dundee and have a combined 35 million tonnes of proven and probable reserves and total measured, indicated and inferred resources of 105 million tonnes.
Magdalena produced 485,000 tonnes in the year to end-February 2010 and 556,000 tonnes in the year to end-February this year and is seen producing an estimated 900,000 tonnes in the next financial year and more than 1 million tons in the 2013 financial year.
At Aviemore production stood at 20,000 tonnes in the 2010 financial year and grew to 92,000 tonnes in 2011. The mine is expected to produce 161,000 tonnes in the 2012 financial year and 420,000 tons the 2013 financial year.
The company therefore expects saleable production to increase from 505,000 tonnes in the 2010 financial year to 1.4 million tonnes in the 2013 financial year.
A longer-term plan is to boost output to ten million tonnes a year.
