(Alliance News) - Edenville Energy PLC on Friday said its annual loss widened in 2018 after a "very challenging year" with heavy rain, a lack of transportation, and modifications to its plant.
Shares in Edenville were down 14% at 0.054 pence in late morning trade.
Edenville's pretax loss for 2018 totalled GBP1.8 million, widened from GBP1.2 million the year before as cost of sales climbed all the way up to GBP1.2 million from nothing in 2017.
Chair Jeffrey Malaihollo called 2018 "a significant, but very challenging year for the company" as it began supplying test orders from its coal wash plant site in Tanzania, which was commissioned in late 2017.
"During the year we managed to increase our production, widened our customer base and signed several long-term supply contracts. We also overcame some challenges related to an unusually heavy rainy period, lack of available transportation and a high percentage of fine coal arising from our production. We had to make modifications to increase the plant capacity and bought additional mining equipment to enable production to go up to 10,000 tonnes per month of washed coal," said Malaihollo.
Revenue for the year was GBP337,125, compared to no revenue at all in 2017.
Administration expenses shrank, however, to GBP839,515 from GBP927,640. Moreover, share based payments halved to GBP76,319 from GBP155,077 and the company had no written off intangible assets compared to GBP104,211 in 2017.
In 2019, the company plans to open the northern mining area of its Tanzanian project. Malaihollo said he expects Edenville to reach break-even point in the third quarter of the year, becoming "cash flow positive within the next 10 months".
Malaihollo said: "In the medium term we are looking at ways to monetise the large amount of fine coal by-product being produced, which could make a significant difference to the profitability of the company. We will also look further into the economics of having our own transportation fleet to supply selected customers.
"In the longer term we are still pursuing the coal to power project and will always look for opportunities for additional cash-flow positive projects."
