LONDON (Alliance News) - South Africa-based thermal coal producer Continental Coal Ltd Monday posted a narrowed pretax loss for the half year to end-June, as it continued to ramp up its Penumbra coal mine and advanced its De Wittekrans coal project.
The company posted a pretax loss of USD33.7 million, narrowed from USD48.3 million in the previous year, as it posted operating sales revenue of USD68.7 million, up from USD62.2 million.
It posted a total run of mine production of 2.1 million tonnes, down from 2.2 million tonnes in the previous year, due to lower production at its Vlakvarkfontein mine and as operations wound down at its Ferreira mine.
Its Penumbra mine produced 498,176 tonnes for the year, up from 143,299 tonnes, as the company ramped up production. During the initial ramp up stage at Penumbra the company, encountered some stone rolls which are displacing the coal seam in the current mining area, which is hitting production.
It has been reviewing its planned production lay-out to mitigate the impact of the stone rolls on the production rate. The mine is ontrack for its targeted 70,000 tonnes per month.
Total coal sales rose to 1.9 million tonnes, up from 1.8 million tonnes.
Continental Coal did not recommended a dividend for the full year.
At De Wittekrans, it executed its mining right in May, and now has 12 months to start mining operations, although the right can be delayed if it does not receive an Integrated Water Use License within the year. In the fourth quarter, the company selected two sites for mining at De Wittekrans, and these sites are now being evaluated.
The company's shares are currently suspended. However, the company expects that the suspension will be lifted on both AIM and the Australian Securities Exchange on the completion of its rights Issue on or around October 2.
It is undertaking a rights issue to raise AUD35.1 million at a price of AUD0.005 per new share to repay unsecured convertible note-holders, loans and royalty holders, repay bridging finance, reduce its borrowings and develop its coal mining projects.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
Copyright 2014 Alliance News Limited. All Rights Reserved.