New World Resources Regulatory News (NWR)

Amsterdam, 14 November 2012

New World Resources

Unaudited interim results for the first nine months of 2012

New World Resources Plc ('NWR' or the 'Company') today announces its financial results for the nine-month period ended 30 September 2012.

9M 2012 Highlights

§ Revenues of EUR 1,013 million, down 18%

§ Mining unit costs of EUR 79/t, down 2%

§ EBITDA of EUR 227 million, down 39%

§ Net profit of EUR 47 million

§ Earnings per A share of EUR 0.17

§ Net debt of EUR 481 million

§ Coal production of 8.6Mt, and external sales of 7.2Mt

§ External sales mix of 53% coking coal, and 47% thermal coal

§ Coke production of 525kt, and external sales of 432kt

§ LTIFR[1] at 7.48, an improvement of 6%

FY 2012 Outlook

§ Coal and coke production targets of 11.0-11.1Mt and 700kt, respectively

§ Coal and coke external sales targets of 10.2-10.3Mt and 600kt respectively

§ External coal sales expected to be split evenly between coking and thermal coal

§ Q4 coking coal and coke prices agreed at EUR 102/t and EUR 264/t respectively

§ Expected flat mining unit costs year-on-year at constant FX

§ Expected CAPEX of EUR 210-220 million

Marek Jelinek, Executive Director and CFO commented on the results: "Trading conditions remained challenging in the third quarter. In an environment where coking coal prices are 30 per cent down year-on-year, our focus will remain on cost containment and watchful management of capital spending in order to ensure we are well positioned for the future.

On the operational side, we are pleased to report an improvement in our already strong safety performance. Despite this overall safety improvement, we have lost four of our colleagues at work this year, which is a reminder of the hazardous conditions in which we operate and we continue to drive forward initiatives to reach our goal of zero fatalities.

Market conditions continue to be difficult. Although steel production in Central and Eastern Europe remains relatively resilient, demand for steel products has deteriorated, particularly in the car industry in Western Europe. This has forced some steel mills and foundries in our core markets to continue operating at reduced levels.

The weakness in the steel industry is having a knock-on effect on steelmaking input raw materials including coking coal. These weak market conditions have been reflected in our pricing for the final quarter of 2012. For the fourth quarter we settled our blended coking coal contracts at EUR 102/t, 20 per cent down on the previous quarter, and our average coke price at EUR 264/t down 8 per cent on the third quarter.

Looking ahead, despite some positive signs, we expect the situation in Europe to remain volatile next year and we therefore remain vigilant and are preparing a series of further efficiency measures at our current operations. Primarily, we plan to enhance our cost containment efforts in 2013 and our sustaining CAPEX will be optimised through a mixture of prudent cuts and deferrals.

In terms of our development projects, the review of the Polish Debiensko Mine is still underway to provide the Board with updated data on which it will base its decision about the future of the project early next year. On the Czech side of the border, the Karvina Mine expansion is progressing as planned.

Longer-term, we remain confident in the resilience of our business, which is underpinned by significant long-standing customer relationships, in a region with the highest proportion of industrial employment in Europe. Although economic growth in key emerging markets such as China or India has moderated, they remain robust as these countries progress with continuing investment in urbanisation, which underpins an improving sentiment towards raw materials for steel production in general."

Selected consolidated financial and operational data

NWR's Revenues were EUR 1,013 million in 9M 2012, EUR 228 million lower than in 9M 2011 mainly due to lower coking coal prices. The lower volume of external coal sales was almost fully offset by an improved coal mix (a greater proportion of higher margin coking coal in the sales mix.)

Lower costs and an increase in the level of inventories in 9M 2012 partially offset the impact of lower coking coal and coke prices on EBITDA of EUR 227 million in 9M 2012, a EUR 142 million decrease compared to 9M 2011. Depreciation and amortisation charges remained flat in CZK terms year-on-year and Operating profit for the period was EUR 97 million.

Net financial expenses decreased due to a lower net foreign exchange loss, and a higher net profit on derivatives revaluation compared to 9M 2011. The profit before tax was EUR 68 million, EUR 98 million below 9M 2011.

The Company's effective tax rate was 30% after 9M 2012 and NWR's consolidated after-tax profit for the period was EUR 47 million, down EUR 74 million versus 9M 2011. The Basic earnings per A share for the nine-month period ended 30 September 2012 were EUR 0.17.

Operating cash flow before working capital changes was EUR 223 million, EUR 125 million lower than in 9M 2011, mainly reflecting lower revenues. Changes in working capital were negative EUR 43 million primarily due to an increase in inventories of thermal coal. As such Operating cash flow before interest and taxes was EUR 180 million. Net operating cash flow after interest (EUR 32 million) and income tax (EUR 42 million) for 9M 2012 was EUR 106 million, EUR 104 million lower than in 9M 2011.

NWR's capital expenditure in 9M 2012 was EUR 165 million. This included maintenance CAPEX for both mining and coking segments, mining equipment renewal, vertical and horizontal mine development, safety and expenditure of EUR 5 million on the Debiensko project. No further CAPEX is planned for Debiensko for the rest of 2012 due to the project's ongoing review. For the full year 2012 we continue to expect to allocate EUR 210-220 million on capital expenditures.

During 9M 2012, the Company paid out the final dividend for 2011 of EUR 19 million and 2012 interim dividend of EUR 16 million to its A shareholders and in line with the payment schedule repaid EUR 7 million of the ECA loan. Cash and cash equivalents were at EUR 444 million as at 30 September 2012 including EUR 100 million of proceeds from the RCF loan.

As at 30 September 2012, the Company's Net debt stood at EUR 481 million. NWR has no significant debt maturities until 2015. We continue to monitor the markets closely so that we are able to take advantage of opportunities either to raise new financing or to refinance outstanding debt or portions thereof as they arise.

Coal segment

Total coal production in 9M 2012 was flat year-on-year, and external coal sales volumes were 10% lower due to lower sales volumes of thermal coal. External coking coal sales volumes increased 8% year-on-year. Total revenues for the coal segment decreased by 20%, mainly due to lower coking coal prices and lower thermal coal volumes.

External coking coal sales in 9M 2012 comprised approximately 47% mid-volatility hard coking coal, 46% semi-soft coking coal, and 7% PCI coking coal. Thermal coal sales mix in the period was approximately 80% thermal coal and 20% middlings.

Mining unit costs remained flat in CZK terms in the first nine months of 2012 compared to 9M 2011 in line with the Company's guidance. All main cost categories remained well under control.

The coal segment generated EBITDA of EUR 228 million, a decrease of 40% compared to 9M 2011 due to lower revenues.

Coal segment outlook

As previously announced, the average agreed price of coking coal for delivery in the fourth calendar quarter of 2012 is EUR 102 per tonne, a 20% decrease compared to the third quarter realised price. This average price is based on the expectation that coking coal sales in Q4 2012 will be split approximately 47% mid-volatility hard coking coal, 45% semi-soft coking coal and 8% PCI coking coal. The average price agreed for thermal coal sales for the 2012 calendar year is EUR 74 per tonne, an 11% increase compared to the 2011 average realised price. This average price is based on an expected FY 2012 mix of 80% thermal coal and 20% middlings.

NWR expects production of between 11.0Mt and 11.1Mt of coal and external sales of between 10.2Mt and 10.3Mt of coal in FY 2012. The external coal sales split is expected to be approximately 50% coking coal and 50% thermal coal in FY 2012. NWR expects year-end coal inventories of 600-700kt.

NWR continues to expect its mining unit costs to remain broadly flat in FY 2012 in CZK terms.

Coke segment

Revenues for the coke segment decreased by 17% due to lower coke prices in 9M 2012. Coke sales in 9M 2012 were approximately 66% foundry coke, 17% blast furnace coke, and 17% other types.

Coke conversion unit costs increased by 7% on a constant currency basis as a result of 10% lower production. Together with the lower cost of inputted coal, both internal and external, the impact of lower revenues on the operating result was muted and the segment's 9M 2012 EBITDA remained at a similar level to 9M 2011.

Coke segment outlook

As previously announced, the average price of coke agreed for delivery in the fourth calendar quarter of 2012 is EUR 264 per tonne, an 8% decrease compared to the third quarter realised price. This average price is based on the expectation of Q4 2012 sales of approximately 73% foundry coke, 9% blast furnace coke and 18% other types.

NWR continues to expect to produce 700kt and sell 600kt of coke in FY 2012.

Coke unit conversion costs on a constant currency basis are expected to increase in line with the expected decrease in production in FY 2012.

9M 2012 earnings call

NWR's management will host an analyst and investor conference call on 14 November 2012 at 10:00 GMT (11:00 CET) to discuss the financial results for the period.

The presentation will be also made available via a live video webcast on www.newworldresources.eu and the webcast will be then archived on the Company's website.

Dial in details:

UK & the rest of Europe +44 (0) 20 7136 2054

US +1 212 444 0896

Czech Republic (Toll free) 800 701 231

Poland (Toll free) 00 800 121 4330

The Netherlands +31 (0) 20 713 2789

Access Code 8843127

A replay of the conference call will be available for one week by dialling:

+44 (0) 20 7111 1244 (Access code: 8843127)

For further information:

Investor Relations Corporate Communications

Tel: +31 20 570 2244 Tel: +31 20 570 2229

Email: ir@nwrgroup.eu Email: pr@nwrgroup.eu

Website: www.newworldresources.eu

About NWR:

New World Resources Plc is one of Central Europe's leading hard coal and coke producers. NWR produces quality coking and thermal coal for the steel and energy sectors in Central Europe through its subsidiary OKD, the largest hard coal mining company in the Czech Republic. NWR's coke subsidiary OKK, is Europe's largest producer of foundry coke. NWR currently has several development projects in Poland and the Czech Republic, which form part of NWR's regional growth strategy. NWR is a FTSE 250 company, with listings in London, Prague and Warsaw.

Disclaimer and cautionary note on forward looking statements and notes on certain other matters

Certain statements in this document are not historical facts and are or are deemed to be "forward-looking". The Company's prospects, plans, financial position and business strategy, and statements pertaining to the capital resources, future expenditure for development projects and results of operations, may constitute forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology including, but not limited to; "may", "expect", "intend", "estimate", "anticipate", "plan", "foresee", "will", "could", "may", "might", "believe" or "continue" or the negatives of these terms or variations of them or similar terminology. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. These forward-looking statements involve a number of risks, uncertainties and other facts that may cause actual results to be materially different from those expressed or implied in these forward-looking statements because they relate to events and depend on circumstances that may or may not occur in the future and may be beyond NWR's ability to control or predict. Forward-looking statements are not guarantees of future performances.

Factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected include, but are not limited to, the following: risks relating to changes in political, economic and social conditions in the Czech Republic, Poland and the CEE region; future prices and demand for the Company's products, and demand for the Company's customers' products; coal mine reserves; remaining life of the Company's mines; coal production; trends in the coal industry and domestic and international coal market conditions; risks in coal mining operations; future expansion plans and capital expenditures; the Company's relationship with, and conditions affecting, the Company's customers; competition; railroad and other transportation performance and costs; availability of specialist and qualified workers; and weather conditions or catastrophic damage; risks relating to Czech or Polish law, regulations and taxation, including laws, regulations, decrees and decisions governing the coal mining industry, the environment and currency and exchange controls relating to Czech and Polish entities and their official interpretation by governmental and other regulatory bodies and by the courts; and risks relating to global economic conditions and the global economic environment. Additional risk factors are as described in the Company's annual report.

Forward-looking statements are made only as of the date of this document. The Company expressly disclaims any obligation or undertaking to release, publicly or otherwise, any updates or revisions to any forward-looking statement contained in this document to reflect any change in its expectations or any change in events, conditions, assumptions or circumstances on which any such statement is based unless so required by applicable law.

New World Resources Plc

Consolidated income statement

All activities were with respect to continuing operations.

The notes on pages 16 to 34 are an integral part of this condensed consolidated financial information.

New World Resources Plc

Consolidated statement of comprehensive income

The notes on pages 16 to 34 are an integral part of this condensed consolidated financial information.

New World Resources Plc

Consolidated statement of financial position

New World Resources Plc

Consolidated statement of financial position (continued)

The notes on pages 16 to 34 are an integral part of this condensed consolidated financial information.

New World Resources Plc

Consolidated statement of cash flows

The notes on pages 16 to 34 are an integral part of this condensed consolidated financial information.

Corporate Information

New World Resources Plc ('NWR Plc' or the 'Company') is a public limited liability company with its registered office at One Silk Street, London EC2Y 8HQ, United Kingdom. The Company is the sole producer of hard coal in the Czech Republic and one of the leading hard coal and coke producers in Central Europe. NWR Plc produces coking and thermal coal through its subsidiary OKD, a.s. ('OKD') and coke through its subsidiary OKK Koksovny, a.s. ('OKK'). NWR Plc and its subsidiaries are collectively referred to as 'the Group'.

The Group operates four mines and four coking batteries in the Czech Republic and has several development projects in Poland and the Czech Republic. The Group serves several large Central and Eastern European steel and energy producers, mainly in the Czech Republic, Poland, Austria, Slovakia, Hungary and Germany. Among its key customers are Arcelor Mittal Steel, U.S. Steel, Dalkia, Moravia Steel, voestalpine, Verbund and ČEZ.

The Group's largest source of revenue is the sale of coking coal, which accounted for 50% of total revenues in 9M 2012, followed by the sale of thermal coal (24%) and the sale of coke (13%).

The majority of our coal sales are based on long-term framework agreements. Thermal coal sales are priced on a calendar year basis. All of the Group's coking coal and coke sales are priced quarterly.

Financial Results Overview

Revenues. The Group's revenues decreased by 18% (17% on a constant currency basis), from EUR 1,240,894 thousand in 9M 2011 to EUR 1,012,755 thousand in 9M 2012. This is mainly attributable to decreased revenues from coking coal and coke, driven by lower prices as well as to decreased revenues from thermal coal, driven by lower sales volumes offset in part by higher prices.

Operating expenses. Total operating expenses including depreciation and amortisation, net of other operating income and gain/loss from sale of material and property, plant and equipment, decreased from EUR 1,047,729 thousand to EUR 987,062 thousand or by 6% (3% on a constant currency basis) in 9M 2012 compared to the same period in 2011. This is mainly attributable to the decrease in:

·; prices and volumes of externally purchased coking coal resulting in lower costs of external coking coal used for coke production;

·; number of employees, holiday allowance and bonus accrual resulting in lower personnel expenses; as well as

·; advisory expenses as a result of one-off costs incurred in relation to the reincorporation process in 2011.

EBITDA. EBITDA decreased by EUR 142,183 thousand or by 39% (40% on a constant currency basis) from EUR 368,989 thousand in 9M 2011 to EUR 226,806 thousand in 9M 2012. The decrease in revenues of EUR 228,139 thousand was only partly offset by a decrease in total operating expenses, before depreciation and amortisation, gain from sale of PPE and net of changes in inventories, of EUR 85,956 thousand.

Basis of Presentation

General information

The condensed consolidated interim financial information (the 'financial information') presented in this document is prepared for the nine-month period ended 30 September 2012, with the nine-month period ended 30 September 2011 as the comparative period.

The Company was incorporated in the UK on 30 March 2011 as part of a corporate reorganisation process under which, on 6 May 2011, it became the holding company for the business held by New World Resources N.V. ('NWR NV'). In accordance with the requirements of International Financial Reporting Standards as adopted by the European Union ('adopted IFRS'), the Company's consolidated financial results and financial position prior to 6 May 2011 are those of NWR NV.

The financial information includes NWR Plc and its subsidiaries. The Company's significant subsidiaries as at 30 September 2012 are:

* representing 100% ownership by NWR NV

The objective of the Company is to act as a holding entity for the Group.

See note 'Changes in the consolidated group' on page 18 of this report for information on the comparative period.

All of the Company's consolidated subsidiaries are incorporated in the Czech Republic, with the exception of NWR KARBONIA S.A. ('NWR Karbonia'), which is incorporated in Poland, and NWR NV, which is incorporated in the Netherlands.

Statement of compliance

The presented financial information is prepared based on the recognition and measurement criteria of adopted IFRS and on the going concern basis that the Directors consider appropriate.

These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting. They do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Company as at and for the year ended 31 December 2011.

Accounting policies

The financial information has been prepared on the basis of accounting policies and methods of compilation consistent with those applied in the annual consolidated financial statements for the year ended 31 December 2011, which are contained within the 2011 Annual Report and Accounts of the Company, available on the Group's website at www.newworldresources.eu.

There is one new standard (Amendment to IFRS 7 Financial Instruments: Disclosure) relevant for the Group which is effective from 1 January 2012. This amendment affects disclosure and presentation only and as such is not relevant for interim financial statements and has no impact on the Group's financial position or performance.

Basis of preparation

The financial information is prepared on a historical cost basis, except for derivative and certain other financial instruments, which are stated at fair value. It is presented in Euro (EUR) and is rounded to the nearest thousand. Financial information of operations with functional currency other than EUR was translated to the Group presentation currency (EUR).

EUR is the functional currency of the Company and NWR NV, Polish Zloty (PLN) is the functional currency of NWR Karbonia and Czech Koruna (CZK) is the functional currency of all the remaining consolidated companies in the Group.

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing these condensed consolidated interim financial statements, the significant judgements made by the management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the consolidated financial statements of the Company for the year ended 31 December 2011.

Changes in the consolidated group

The changes listed below include all changes in the consolidated group for the period from 1 January 2011 to 30 September 2012.

New subsidiary

A new 100% subsidiary of NWR NV, NWR Communications, s.r.o. was established on 6 June 2011 to perform public relations and corporate communications activities.

Reincorporation

The Company was incorporated in the UK on 30 March 2011 as part of a corporate reorganisation process under which it became the holding company for the businesses held by NWR NV.

The reorganisation was undertaken by way of an offer by the Company to the shareholders of NWR NV to exchange shares in the Company for their shares in NWR NV on a one-for-one basis. The condition of the offer relating to acceptances was met on 5 May 2011 (the 'first closing date') and the Company became the new holding company when it issued shares to all accepting shareholders of NWR NV on 6 May 2011. At that date the Company held approximately 97.0% of the A shares of NWR NV and 100% of its B shares. Subsequent closings reduced the number of shares of NWR NV that were not held by the Company to approximately 0.2%, representing a non-controlling interest in NWR NV as at 30 September 2012.

On 9 October 2012, the Company completed the process of a compulsory squeeze-out under which it intended to acquire the remaining shares in NWR NV. Following the judgement of the Enterprise Chamber of the Amsterdam Court of Appeals from 19 June 2012, in which it ordered the holders of the remaining shares in NWR NV to transfer their shares to the Company for a price of EUR 3.96 per share and after the three month appeal period had lapsed, the Company acquired the remaining shares in NWR NV for EUR 2,277 thousand and became the sole shareholder of NWR NV on 9 October 2012. Following completion, NWR NV shares were delisted from the Warsaw Stock Exchange on 19 October 2012, and are no longer listed on any stock exchange.

The reincorporation did not lead to a change in control and did not result in any changes to the day-to-day operations of the Group.

Non-IFRS Measures

The Company defines EBITDA as net profit before non-controlling interests, income tax, net financial costs, depreciation and amortisation, impairment of property, plant and equipment ('PPE') and gains/losses from the sale of PPE. While the amounts included in EBITDA are derived from the Group's financial information, it is not a financial measure determined in accordance with adopted IFRS. Accordingly, EBITDA should not be considered as an alternative to net income or operating income as a sole indication of the Group's performance or as an alternative to cash flows as a measure of the Group's liquidity. The Company currently uses EBITDA in its business operations to, among others, evaluate the performance of its operations, develop budgets, and measure its performance against those budgets. The Company considers EBITDA a useful tool to assist in evaluating performance because it excludes interest, taxes and any non-cash charges.

The Company defines net debt as total debt less cash and cash equivalents. Total debt includes issued bonds, long-term and short-term interest‑bearing loans and borrowings. Total debt is defined as gross amount of debt less related expenses. Interest‑bearing loans, bond issues, and borrowings are measured at amortised cost.

Exchange Rates

The Czech Koruna depreciated (based on the average exchange rate) by 3% between 9M 2012 and the same period of 2011.

Throughout this presentation of the operating results, the financial results and performance compared to the prior period, both in absolute and percentage terms, are expressed in Euros. The Company may also, where deemed relevant, present variances in terms of constant foreign exchange rates, marked 'ex-FX', which exclude the estimated effect of currency translation differences and are non-IFRS financial measures. The financial information could differ considerably if the financial information was presented in CZK.

Financial Performance

Revenues

Revenues of the Group decreased by 18% to EUR 1,012,755 thousand in 9M 2012 compared to the same period in 2011.

*For the purpose of this analysis, where the Group sells products on an EXW or similar basis, the notional transport element is shown separately in order to separate the impact of changing transport costs from changes in the underlying achieved price for the products sold.

The decrease in total revenues mainly reflects lower revenues from sales of both coking and thermal coal as well as coke. The decrease in coking coal and coke revenues is attributable mainly to lower realised prices, in line with lower prices for steel making materials globally, as well as in our region (see table below), partly offset by higher coking coal sales volumes. The decrease in thermal coal revenues is attributable to a decrease in sales volumes, partly offset by higher realised prices. The decrease in other revenues is attributable to the negative impact of derivatives used to hedge the currency risk relating to sales denominated in currencies other than CZK.

Total production of coal in 9M 2012 remained almost flat compared to production volume in the same period of 2011. Coal volumes sold to third parties were lower by 10% as a result of lower thermal coal sales in 9M 2012 partly offset by higher coking coal sales.

Consequently, coal inventories increased by 1,005kt in 9M 2012 compared to an increase of 196kt in the same period in 2011.

* Inventory consists of coal available for immediate sale and coal that has to be converted from raw coal. Opening and closing inventory balances do not always reconcile due to various factors such as production losses. This balance excludes coking coal inventory held by OKK that will be used for coke production and amounted to 10kt (2011: 7kt).

Coke production decreased by 10% in 9M 2012 compared to the same period in 2011, with coke sales almost flat year-on-year.

Coke inventories increased by 31kt in 9M 2012 compared to an increase of 76kt in the same period in 2011.

Operating Expenses

Total operating expenses, net of other operating income and gain/loss from sale of material and property, plant and equipment ('PPE'), decreased by 6% (3% on a constant currency basis) in 9M 2012 compared to the same period in 2011.

Consumption of Material and Energy

The costs associated with the consumption of externally purchased coal for the need of the coking operations decreased due to lower prices of coking coal and lower consumed volumes.

Consumption of material and energy, excluding external coal consumption, remained flat on an ex-FX basis. The decrease in the consumption of mining material and spare parts is mainly due to decrease in development works, to some extent offset by higher costs per longwall due to more demanding geological conditions of mining at greater depth.

Service Expenses

The reduction in advisory expenses is attributable to one-off expenses incurred during 9M 2011 related to the reincorporation process.

The decrease in maintenance costs is attributable to lower planned maintenance works year-on-year.

The decrease in contractors' costs is the result of a 4% decrease in the number of shifts, partly offset by a 2% increase in unit costs per shift ex-FX. Contractors headcount decreased by 2% when compared to the previous period.

Personnel Expenses

Total personnel expenses decreased by 2% compared to 9M 2011 on a constant currency basis, mainly as a result ofa 1% headcount decrease, and lower accrual for bonuses and other allowances.

In 9M 2012, the average number of employees including contractors decreased by 1% compared to the same period in 2011.

Other Operating Income and Expenses

Other operating income and expenses is composed of insurance costs, donations, various taxes and fees, provisions for mining damages and indemnity and their release and other expenses. Since the amounts within the other operating income are relatively low, they are sensitive to one‑time effects and seasonal fluctuations.

EBITDA

The Group's EBITDA for 9M 2012 decreased by 39% compared to the same period in 2011 mainly as a result of lower revenues from both coking and thermal coal as well as from coke.

As EBITDA is a non-IFRS measure, the following table provides a reconciliation of EBITDA to IFRS line items of the income statement.

Depreciation and amortisation

As the functional currency of the main operating subsidiaries OKD and OKK is CZK, most of the depreciation cost is recorded in this currency. Excluding the impact of changes in the exchange rate, depreciation increased by 1% in 9M 2012compared to the same period in 2011.

Financial Income and Expense

The decrease in net financial expense of 58% in 9M 2012 compared to 9M 2011 is mainly attributable to a decrease in net foreign exchange loss by EUR 17,753 thousand, and to an increase of EUR 25,980 thousand in net profit on revaluation of derivatives for which hedge accounting is not applied.

Profit before Tax

Profit before tax in 9M 2012 was EUR 67,502 thousand, a decrease of EUR 98,097 thousand compared to a profit of EUR 165,599 thousand for the same period in 2011.

Income Tax

The Group recorded a net income tax expense of EUR 20,134 thousand in 9M 2012, compared to a net income tax expense of EUR 44,576 thousand in 9M 2011. The effective tax rate is 30% in 9M 2012 compared to 27% in the same period in 2011.

Profit for the Period

Profit in 9M 2012 was EUR 47,368 thousand, which represents a decrease of EUR 73,655 thousand compared to the profit of EUR 121,023 thousand for the same period of 2011.

Earnings per Share

The calculation of earnings per share was based on profit attributable to the shareholders of the Company and a weighted average number of shares outstanding during the nine-month period ended 30 September:

Cash Flow

Cash Flow from Operating Activities

The Group's primary source of cash is its operating activities. Cash generated  from operating activities, after working capital changes and before interest and tax payments in 9M 2012 was EUR 179,911 thousand, which was EUR 112,569 thousandlower than in the same period in 2011, and is in line with lower EBITDA during the reporting period. 

Cash Flow from Investing Activities

Capital expenditures amounted to EUR 165,427 thousand in 9M 2012, an increase of EUR 9,688 thousand when compared to the same period of 2011. The capital expenditures consist mainly of spending in the Coal segment, including the development of new mining areas. 

Cash Flow from Financing Activities

Cash flow from financing activities consisted of repayment of the ECA loan of EUR 7,123 thousand (the same amount was repaid in the comparative period of 2011) and dividend payment of EUR 34,444 thousand to A shareholders (EUR 100,586 thousand to A shareholders and EUR 40,000 thousand to B shareholders in comparative period of 2011).

Liquidity and Capital Resources

The Company is a holding company and relies on dividends or other distributions from subsidiaries, inter-company loans or other capital contributions to fund its liquidity requirements. The liquidity requirements of the Group arise primarily from working capital requirements, interest and principal payments on the bonds, loans and borrowings, dividend payments, the need to fund capital expenditures and, on a selective basis, acquisitions. The dividends, distributions or other payments from subsidiaries are expected to be funded by cash from their operations. The Group continuously reviews its cash flow and operations in order to safeguard the business as a going concern, and believes that the cash generated from its operations and borrowing capacity will be sufficient to meet its principal uses of cash, which includes future planned operating expenditures, anticipated capital expenditures (including acquisitions or mining equipment), scheduled debt and interest payments and distributions. To augment the existing cash and liquidity resources, the Company continues to evaluate a range of transactions including debt financing. The Company may consider, from time to time, to carry out transactions to acquire, repay or discharge its outstanding debt (or portions thereof).

As at 30 September 2012, the Group held cash and cash equivalents of EUR 443,566 thousand and had indebtedness of EUR 924,207 thousand, of which EUR 113,851 thousand is contractually repayable in the next 12 months (EUR 114,246 in nominal values). This results in a net debt position for the Group of EUR 480,641 thousand, 20% higher when compared to EUR 400,303 thousand as at 30 September 2011 and 23% higher when compared to EUR 391,467 thousand as at 31 December 2011.

The Indenture governing the 7.375% Senior Notes (the '7.375% Indenture') and the Indenture governing the 7.875% Senior Notes (the '7.875% Indenture') also impose restrictions on the Company's ability to pay dividends. Generally, the Company may not pay dividends or make other restricted payments, which exceed, in aggregate, 50% of consolidated net income since 1 April 2007 (as such amounts are accrued on a quarterly basis) plus the net proceeds from the primary tranche of the 2008 IPO and certain other adjustments. The purchase price for investments in entities other than majority owned subsidiaries would also constitute restricted payments. The restricted payment basket as defined by the 7.375% Indenture and the 7.875% Indenture amounted to approximately EUR 109,879 thousand as at 30 September 2012.

The Group is also subject to certain covenants under the ECA loan agreement, and the Group was in compliance with these covenants in the reporting period.

Segments and Divisions

NWR's business is organised into three segments; Coal, Coke and Real Estate Division ('RED') segment; for which financial and other performance measures are separately available and regularly evaluated by the Chief Operating Decision Maker ('CODM'). The CODM is the Company's Board of Directors. These operational segments were identified based on the nature, performance and financial effects of key business activities of the Group.

The Group is further organised into two divisions: the Mining Division ('MD') and the Real Estate Division. The Company had A Shares and B Shares outstanding for the presented periods. The A Shares and B Shares are tracking stocks, which are designed to reflect the financial performance and economic value of the MD and RED, respectively. Due to the public listing of the Company's A shares, the Group provides divisional reporting showing separately the performance of the MD and RED. The main rights, obligations and relations between the RED and MD are described in the Divisional Policy Statement, available at Company's website www.newworldresources.eu.

The divisional reporting, as such, is essential for the evaluation of the equity attributable for the listed part of the Group. As the operating segments form part of the divisions, and in order to provide understandable and transparent information, the Company decided to combine the segment and divisional disclosure into one table, with the Coal and Coke segments within the Mining division and the RED segment within Real Estate division. The Company's headquarters is included in the Other information under the Mining division. The accounting principles of this segmental and divisional disclosure are described in NWR's 2011 Annual Report and Accounts.