LONDON (Alliance News) - Atlantic Coal PLC Thursday said its pretax loss narrowed in its last financial year, as lower costs in some areas of the business more than offset pressure on anthracite prices.
However, its cash pile is dwindling. Atlantic Coal said its cash at bank fell to USD877,003 by the year end, from USD1.9 million a year earlier, although much of it was use to pay down debt to USD4.8 million, from USD6.8 million. It managed to cut the cash outflow from operating activities to USD19,746, from USD1.6 million.
In a statement, Atlantic Coal, which mines anthracite at its Stockton mine, said it made a USD1.5 million pretax loss in 2013, compared with a USD2.7 million loss in 2012. Revenue was maintained at USD19.7 million, but the company gross margin fell to 18.4%, from 20.4%, as its cost of sales rose.
Administration expenses increased to USD3.4 million, from USD3.0 million. However, new venture costs fell by USD1.4 million to USD497,623, in the wake of last year's joint venture with China based CIC Brancepeth Coal Ltd. Other losses, which were not detailed by Atlantic Coal, fell by more than half to USD421,960.
Chairman Adam Wilson said the narrowed loss was a sign of Atlantic Coal's commitment to drive down cost and improve efficiency.
"Whilst we have seen downward pressure on the prices we receive for Stockton's anthracite, we have still been able to maintain total revenues in spite of coal selling for an average of USD128 per ton. In our drive to secure profitability, we have seen some impact on our efforts to reduce cost. In 2013 Stockton's cost of clean coal per ton sold was USD105 per ton compared to USD112 per ton in 2012," Wilson said in a statement.
"Operationally we are still mining anthracite at our flagship Stockton mine within a profitable threshold, but naturally we would like to see a return to higher anthracite prices. In the meantime we have extended our lease option on Pott & Bannon and remain on the lookout for other assets in Pennsylvania in line with our stated strategy is to continue to grow Atlantic Coal and build up our access to further high quality anthracite assets," Wilson added.
The Chairman noted that Stockton was able to reduce its mine strip ratio of overburden to clean coal, seen as critical to making cost reductions, to 17.3 from 23.1.
Atlantic Coal shares were Thursday quoted at 0.16 pence, down 8.6%.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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