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Press Releases / 2013 / Unaudited Q1 2013 results and business optimisation steps 

Unaudited Q1 2013 results and business optimisation steps

16/5/2013

New World Resources Plc (‘NWR’ or the ‘Company’) today announces its unaudited financial results for the first quarter of 2013 and steps to optimise its business.

Q1 2013 Financial summary

  • Revenues of EUR 240 million, down 31%.
  • Cash mining unit costs of EUR 86/t, up 2%[1].
  • EBITDA of EUR (22) million.
  • Basic loss per A share of EUR (0.31).
  • Net debt of EUR 643 million; Debt maturity profile pushed out.
  • Waivers agreed for financial covenants in NWR’s bank facilities.
  • Cash of EUR 193 million with further EUR 100 million available under RCF.

Q1 2013 Operational summary

  • LTIFR[2] of 5.71, improvement of 21%.
  • Regrettably, two miners died in fatal accidents this year.
  • Coal production of 2.1Mt, and external sales of 2.0Mt.
  • External sales mix of 49% coking coal and 51% thermal coal.
  • Coke production of 168kt and external sales of 149kt.

Business optimisation steps

  • EUR 100 million short-term measures at current operations to enhance NWR’s financial position.
  • Business portfolio optimisation to ensure the existing business is cash neutral in current pricing environment, including divestment of OKK.
  • 2013 targets reflecting the continuation of difficult trading conditions and price pressures.
  • Strategic target to become Europe’s leading miner and marketer of coking coal by 2017 reiterated.

Chairman’s statement

The period under review has been extremely difficult as the deterioration of global coking coal markets, which began in mid-2011, continued into 2013. Coal markets around the world are experiencing one of the deepest and longest market adjustments of the last 30 years.

Over the past two years, the Australian HCC average spot price fell over 50 per cent from above USD 330/t to less than USD 160/t. Such price developments affect the whole industry and for many of our competitors these pricing levels have become unsustainable. Furthermore, we believe that a number of European economies will need to go through further major fiscal adjustments, and this will weigh on economic growth going forward.

Given the negative effect of these external developments on NWR’s financial and operational performance, the management has decided to take aggressive but necessary steps to ensure the stability of current operations, and position NWR for delivery of its strategic plans.

The immediate steps include EUR 100 million worth of short-term measures to fortify NWR’s financial position including among others an immediate 10 per cent group-wide cut in salaries, additional CAPEX savings and deferrals, the sale of thermal coal inventories, and active working capital management. Waivers recently negotiated for financial covenants in our bank facilities give us sufficient comfort, and we can fully focus on execution of these measures.

As a result of an operational review NWR has started the process of divesting its coke operations, OKK. We are also running stress tests to identify individual mines, or sections of individual mines that could be idled or divested.

Further structural measures are aimed at turning our mining subsidiary, OKD into a leaner, more efficient organisation. We will simplify its structure, and centralise our management activities. We are initiating administrative staff reductions. The new structure should be implemented and start bringing benefits by year-end.

Consequently, we have revised our 2013 operational targets to reflect the continuation of difficult trading conditions and price pressures, as well as the measures described above.

Our strategic target to become Europe’s leading miner and marketer of coking coal by 2017 includes doubling our coking coal sales and supplying a broader set of European steel customers with the full range of coking coal qualities. We remain fully committed to this strategy, and our focus on coking coal, both in the region and overseas remains unchanged.

In terms of safety, I am very pleased to report for the first time in our history less than six loss-time injuries per million hours at our operations during the first three months of this year. Unfortunately, two fatal accidents in April reminded us that we can never become complacent about our safety performance, and that we must continue with our efforts, including promoting the ‘safety first’ attitude among our employees.

NWR has a strong market position in Central Europe, a region that has gradually developed into the manufacturing hub of Europe. The Company has excellent relationships with and established logistic links to its customers. More broadly, Europe continues to be short of coking coal (premium HCC qualities in particular) irrespective of economic ups and downs. Every year over 50Mt of seaborne coking coal enters the European market, and this figure is set to grow as Europe’s coking coal supply continues to decline.

Optimisation of our current operations, together with our mining expertise, skilled workforce, financial discipline and focus on safety position us well for the inevitable recovery in metallurgical coal markets, and for the realisation of our strategic plans.

Gareth Penny, Executive Chairman of NWR

Business optimisation steps

1. EUR 100 million short-term measures:

  • Reduction in budgeted Operating expenses of EUR 25 million by year-end, including:
    • Across-the-board 10 per cent salary cut effective 1 May, 2013 to save EUR 15 million by year-end;
    • Decrease in contractor costs of EUR 5 million by year-end;
    • Administrative and material cost cuts of EUR 5 million by year-end.
  • CAPEX savings and deferrals of EUR 20 million in 2013 on selected gateroad developments and non-critical maintenance.
  • Working capital optimisation of EUR 55 million, including:
    • Sell down of thermal coal inventories (mostly lower grades of thermal coal and middlings) to one-time customers to generate around EUR 15 million of cash before the year-end;
    • Optimisation of receivables and payables to generate EUR 40 million of cash by year-end.

2. Business portfolio optimisation:

  • Divestment of coke operations; Process started;
  • Stress tests to identify individual mines, or sections of individual mines that could be idled or divested;
  • Centralised mine management; Administrative staff reductions; New structure by year-end.

3. 2013 Targets:

Production

  • Coal production target of 9-10Mt.
  • Coke production target of 800kt.

Sales

  • External sales target of 8.5-9.5Mt of coal equally split between coking and thermal coal.
  • Additional 500kt of sales expected from thermal coal inventories in 2013.
  • Coke sales target of 700kt.

Prices[3]

  • Thermal coal price for 2013 expected at an average of EUR 60/t. 80% priced yearly and 20% re-priced quarterly.
  • Coking coal Q2 2013 average price agreed at EUR 104/t.
  • Coke Q2 2013 average price agreed at EUR 246/t.

Costs

  • Stable Cash mining unit costs and Cash coke conversion unit costs at constant FX.[4]

CAPEX

  • EUR 100 million, of which EUR 10 million budgeted for the Debiensko project.

4. Europe’s leading miner and marketer of coking coal by 2017:

  • Fully optimised current operations:
    • Coal production between 8 – 9Mt
    • Coking coal above 60 per cent of external coal sales;
    • Lower overheads and Cash mining unit cost of EUR 60/t ;
    • Annual maintenance CAPEX below EUR 100 million;
    • LTIFR below 5.
  • 10Mtpa of coking coal sales to Europe:
    • Combination of mining projects and new marketing initiatives;
    • Engage in the import market for seaborne coking coal.

 

  • Become a ‘one-stop shop’ for European steel customers:
    • Build on marketing capabilities;
    • Supply full range of coking coal qualities throughout Europe.

 

Summary tables

Full disclosure to the following information is outlined further in this document, in the Operating and Financial Review for the three-month period ended 31 March 2013.

Selected consolidated financial and operational data

(EUR m, unless otherwise stated)

Q1 2013

Q1 2012

Chg

 

Revenues

240

347

(31%)

 

Cost of sales

256

276

(7%)

 

Gross (loss) / profit

(16)

71

-

 

Selling and administrative expenses

50

60

(18%)

 

EBITDA

(22)

54

-

 

Operating (loss) / profit

(66)

11

-

 

(Loss) / Profit for the period

(80)

6

-

 

Basic (loss) / earnings per A share (EUR)

(0.31)

0.02

-

 

 

 

 

 

 

Total assets

2,059

2,328

(12%)

 

Cash and cash equivalents

193

445

(57%)

 

Net debt

643

385

67%

 

Net working capital

101

98

4%

 

 

 

 

 

 

Net cash flow from operations

(22)

73

-

 

CAPEX

60

69

(13%)

 

 

 

 

 

 

Total headcount incl. contractors

17,078

17,991

(5%)

 

LTIFR

5.71

7.25

(21%)

 

Coal segment

 

Q1 2013

Q1 2012

 Chg

P&L (EUR m)

 

 

 

Revenues

211

312

(32%)

EBITDA

(22)

52

-

Operating (loss) /profit

(64)

11

-

Costs

 

 

Cash mining unit costs (EUR/t)[5]

86

84

2%

Selling and administrative expenses (EUR m)

39

50

(20%)

Production & Sales (kt)

 

 

 

Coal production

2,147

2,389

(10%)

Sales to coke segment

134

140

(4%)

External sales

2,038

2,289

(11%)

Coking coal[6]

1,002

1,290

(22%)

Thermal coal[7]

1,036

999

4%

Period end inventory

1,262

264

378%

Average realised prices (EUR/t)

 

 

Coking coal

101

141

(28%)

Thermal coal

64

75

(15%)

 


Coke segment

 

Q1 2013

Q1 2012

 Chg

P&L (EUR m)

 

 

 

Revenues

44

56

(21%)

EBITDA

2

5

(53%)

Operating profit

1

3

(79%)

Costs

 

 

Cash conversion unit costs[8] (EUR/t)

53

53

0%

Selling and administrative expenses (EUR m)

7

7

(1%)

Coal purchase charges[9] (EUR m)

26

35

(27%)

Production & Sales (kt)

 

 

 

Coke production

168

175

(4%)

Coke sales[10]

149

155

(4%)

Period end inventory

205

161

27%

Average realised prices (EUR/t)

 

 

Coke

246

310

(21%)

 


 

Q1 2013 earnings webcast

NWR’s management will host an analyst and investor conference call on 16 May 2013 at 10:00 BST (11:00 CET). The presentation will be made available via a live audio webcast on www.newworldresources.eu and then archived on the Company’s website.

For those who would like to join the live call, dial in details are as follows:

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

US                                                                 +1 646 254 3388

Czech Republic (toll free)                             800 701 231

Poland (toll free)                                            00 800 121 4329

The Netherlands                                            +31 (0) 20 721 9158

 

Access code                                                  3741087

A replay of the conference call will be available for one week by dialling +44 (0) 20 3427 0598, and using access code 3741087.

For further information, please contact:

Investor Relations                                                      Corporate Communications

Tel: +31 20 570 2244                                                Tel: +420 225 282 451

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

 

Website: www.newworldresources.eu

Notes to editors:

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.

In 2013 the Company announced a strategic outlook to reposition NWR into Europe’s leading miner and marketer of coking coal by 2017.

NWR is a FTSE 250 company, with listings in London, Prague and Warsaw.


 

Condensed consolidated interim financial information
for the three-month period
ended 31 March 2013

New World Resources Plc

Consolidated statement of comprehensive income

Three-month period ended 31 March

EUR thousand

2013

2012 (restated)

 

 

 

Revenues

240,124

346,682

Cost of sales

(256,359)

(275,539)

 

 

Gross (loss) / profit

(16,235)

71,143

Selling expenses

(27,314)

(34,064)

Administrative expenses

(22,260)

(26,033)

Other operating income

799

629

Other operating expenses

(778)

(825)

 

 

Operating (loss) / income

(65,788)

10,850

Financial income

10,731

26,356

Financial expense

(38,555)

(29,411)

 

 

(Loss) / profit before tax

(93,612)

7,795

Income tax benefit / (expense)

13,284

(1,611)

 

 

(Loss) / profit for the period

(80,328)

6,184

 

 

Other comprehensive income

 

 

Foreign currency translation differences

(27,129)

52,520

Derivatives - change in fair value

(2,599)

7,751

Derivatives - transferred to profit and loss

(2,405)

3,634

Income tax relating to components of other comprehensive income

2,212

(1,364)

 

 

Total other comprehensive income for the period, net of tax

(29,921)

62,541

 

 

 

Total comprehensive income for the period

(110,249)

68,725

 

 

 

(Loss) / profit attributable to:

 

 

Non-controlling interests

-

17

Shareholders of the Company

(80,328)

6,167

 

 

 

Total comprehensive income attributable to:

 

 

Non-controlling interests

-

152

Shareholders of the Company

(110,249)

68,573

 

 

 

(LOSS) / EARNINGS PER SHARE (EUR)

A share

 

 

Basic (loss) / earnings

(0.31)

0.02

Diluted (loss) / earnings

(0.31)

0.02

B share

 

 

Basic earnings 

117.40

76.80

Diluted earnings

117.40

76.80

All activities were with respect to continuing operations.

The notes on pages 15 to 30 are an integral part of this condensed consolidated financial information.


 

New World Resources Plc

Consolidated statement of financial position

31 March

31 December

31 March

EUR thousand

2013

2012

2012

 

 

 

 

ASSETS

 

 

 

Property, plant and equipment

1,426,446

1,476,570

1,410,827

Mining licences

138,034

143,020

152,548

Accounts receivable

5,735

7,949

8,906

Deferred tax

10,722

11,262

9,944

Restricted deposits

10,918

13,300

9,896

Derivatives

1

-

313

TOTAL NON-CURRENT ASSETS

1,591,856

1,652,101

1,592,434

 

 

 

 

Inventories

139,751

151,333

95,910

Accounts receivable and prepayments

132,662

130,046

192,427

Derivatives

-

760

1,972

Income tax receivable

2,193

9

138

Cash and cash equivalents

192,905

267,011

445,204

TOTAL CURRENT ASSETS

467,511

549,159

735,651

 

 

 

 

TOTAL ASSETS

2,059,367

2,201,260

2,328,085

 

 

 

EQUITY

 

 

 

Share capital

105,863

105,863

105,756

Share premium

2,368

2,368

2,368

Foreign exchange translation reserve

59,507

81,735

100,512

Restricted reserve

129,655

132,691

134,655

Equity-settled share based payments

14,213

13,827

15,470

Hedging reserve

3,168

7,825

10,263

Merger reserve

(1,631,161)

(1,631,161)

(1,631,161)

Other distributable reserve

1,684,463

1,684,463

1,692,319

Retained earnings

280,314

360,642

390,552

EQUITY ATRIBUTABLE TO THE SHAREHOLDERS OF THE  COMPANY

648,390

758,253

820,734

 

 

 

 

Non-controlling interests

-

-

1,785

 

 

 

 

TOTAL EQUITY

648,390

758,253

822,519


New World Resources Plc

Consolidated statement of financial position (continued)

31 March

31 December

31 March

EUR thousand

2013

2012

2012

 

 

 

 

LIABILITIES

 

 

 

Provisions

176,407

179,824

179,941

Long-term loans

62,413

62,333

76,267

Bonds issued

759,279

741,805

739,420

Employee benefits

90,973

93,211

91,609

Deferred revenue

2,048

2,704

2,150

Deferred tax

92,796

111,064

120,297

Other long-term liabilities

793

979

426

Cash-settled share-based payments

1,883

2,018

1,070

Derivatives

8,674

10,398

14,896

TOTAL NON-CURRENT LIABILITIES

1,195,266

1,204,336

1,226,076

 

 

 

 

Provisions

7,020

5,681

12,034

Accounts payable and accruals

170,975

204,830

190,599

Accrued interest payable on bonds

16,406

8,937

23,530

Derivatives

7,349

4,691

10,583

Income tax payable

92

159

27,142

Current portion of long-term loans

13,869

13,852

14,637

Cash-settled share-based payments

-

521

965

TOTAL CURRENT LIABILITIES

215,711

238,671

279,490

 

 

 

 

TOTAL LIABILITIES

1,410,977

1,443,007

1,505,566

 

 

 

 

TOTAL EQUITY AND LIABILITIES

2,059,367

2,201,260

2,328,085

The notes on pages 15 to 30 are an integral part of this condensed consolidated financial information.


 

New World Resources Plc

Consolidated statement of cash flows

Three-month period ended 31 March

EUR thousand

2013

2012

 

 

 

Cash flows from operating activities

 

 

(Loss) / profit before tax and non-controlling interest

(93,612)

7,795

Adjustments for:

 

 

Depreciation and amortisation

43,492

42,991

Changes in provisions

(5,017)

7,486

Loss / (profit) on disposal of property, plant and equipment

14

(42)

Interest expense, net

15,748

18,020

Change in fair value of derivatives

(3,304)

(18,821)

Loss on early bond redemption

8,116

-

Equity-settled share-based payment transactions

386

1,235

Operating cash flows before working capital changes

(34,177)

58,664

 

 

 

Decrease / (increase) in inventories

11,582

(2,822)

(Increase) / decrease in receivables

(2,618)

11,171

(Decrease) / increase in payables and deferred revenue

(3,713)

7,536

Decrease  in restricted cash and restricted deposits

2,127

9,481

Currency translation and other non-cash movements

12,367

(3,605)

Cash generated from operating activities

(14,432)

80,425

 

 

 

Interest paid

(5,294)

(2,644)

Corporate income tax paid

(2,372)

(5,082)

 

 

 

Net cash flows from operating activities

(22,098)

72,699

 

 

 

Cash flows from investing activities

 

 

Interest received

510

2,938

Purchase of land, property, plant and equipment

(59,529)

(68,640)

Proceeds from sale of property, plant and equipment

63

534

 

 

 

Net cash flows from investing activities

(58,956)

(65,168)

 

 

 

Cash flows from financing activities

 

 

Senior Notes due 2015 redemption

(257,565)

-

Fees paid on Senior Notes due 2015 redemption

(4,749)

-

Repayments of short-term borrowings

-

(100,054)

Proceeds from Senior Notes due 2021 issue

275,000

-

Transaction costs related to Senior Notes due 2021

(4,087)

-

 

 

 

Net cash flows from financing activities

8,599

(100,054)

 

 

 

Net effect of currency translation

(1,651)

817

 

 

 

Net decrease in cash and cash equivalents

(74,106)

(91,706)

 

 

 

Cash and Cash Equivalents at the beginning of period

267,011

536,910

Cash and Cash Equivalents at the end of period

192,905

445,204

The notes on pages 15 to 30 are an integral part of this condensed consolidated financial information.


New World Resources Plc

Consolidated statement of changes in equity

EUR thousand

Share capital

Share premium

Foreign exchange translation reserve

Restricted reserve

Equity-settled share based payment

Hedging reserve

Merger reserve

Other distributable reserve

Retained earnings

Shareholders’ equity

Non-controlling interests

Consolidated group total

Balance at 1 January 2013

105,863

2,368

81,735

132,691

13,827

7,825

(1,631,161)

1,684,463

360,642

758,253

-

758,253

Loss for the period

-

-

-

-

-

-

-

-

(80,328)

(80,328)

-

(80,328)

Total other comprehensive income

-

-

(22,228)

(3,036)

-

(4,657)

-

-

-

(29,921)

-

(29,921)

Total comprehensive income for the period

-

-

(22,228)

(3,036)

-

(4,657)

-

-

(80,328)

(110,249)

-

(110,249)

Transaction with owners recorded directly in equity

 

 

 

 

 

 

 

 

 

Share options for A Shares

-

-

-

-

386

-

-

-

-

386

-

386

Total transactions with owners

-

-

-

-

386

-

-

-

-

386

-

386

Balance at 31 March 2013

105,863

2,368

59,507

129,655

14,213

3,168

(1,631,161)

1,684,463

280,314

648,390

-

648,390

 

Balance at 1 January 2012

105,756

2,368

56,056

129,136

14,235

(2,168)

(1,631,161)

1,692,319

384,386

750,927

1,632

752,559

Profit for the period

-

-

-

-

-

-

-

-

6,167

6,167

17

6,184

Total other comprehensive income

-

-

44,456

5,519

-

12,431

-

-

-

62,406

135

62,541

Total comprehensive income for the period

-

-

44,456

5,519

-

12,431

-

-

6,167

68,573

152

68,725

Transaction with owners recorded directly in equity

 

 

 

 

 

 

 

 

 

Share options for A Shares

-

-

-

-

1,235

-

-

-

(1)

1,234

1

1,235

Total transactions with owners

-

-

-

-

1,235

-

-

-

(1)

1,234

1

1,235

Balance at 31 March 2012

105,756

2,368

100,512

134,655

15,470

10,263

(1,631,161)

1,692,319

390,552

820,734

1,785

822,519

The notes on pages 15 to 30 are an integral part of this condensed consolidated financial information.


New World Resources Plc
Operating and Financial Review
for the three-month period ended 31 March 2013
(‘3M 2013’)

 

1.    Corporate Information

New World Resources Plc (‘NWR’ 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 produces coking and thermal coal through its subsidiary OKD, a.s. (‘OKD’) and coke through its subsidiary OKK Koksovny, a.s. (‘OKK’). NWR and its subsidiaries are collectively referred to as the ‘Group’.

  1. Financial Results Overview

Revenues. The Group’s revenues decreased by 31% (30% on a constant currency basis), from EUR 347 million in 3M 2012 to EUR 240 million in 3M 2013. This is mainly attributable to lower realised prices for coking coal, thermal coal as well as coke and lower sales volumes of coking coal.

Cost of sales. Cost of sales decreased from EUR 276 million to EUR 256 million or by 7% (6% on a constant currency basis) in 3M 2013 compared to 3M 2012. This is mainly attributable to the decrease in:

  • production and development works, resulting in lower consumption of mining material and spare parts;
  • number of shifts and contractors, resulting in lower service expenses
  • provision for mining damages.

Selling expenses. Selling expenses decreased from EUR 34 million to EUR 27 million or by 20% in 3M 2013 following lower sales volumes, which subsequently resulted in a decrease in transport costs.

Administrative expenses. Administrative expenses decreased from EUR 26 million to EUR 22 million or by 14% in 3M 2013 principally as a result of lower charitable donations made in 3M 2013.

EBITDA. 3M 2013 saw a negative EBITDA of EUR 22 million, a decrease of EUR 76 million from EUR 54 million achieved in 3M 2012. The decrease in revenues of EUR 107 million was only partly offset by a decrease in total operating expenses, before depreciation and amortisation, and gains from sale of PPE, of EUR 31 million.

  1. Basis of Presentation

The condensed consolidated interim financial statements (the ‘financial statements’) presented in this document are prepared:

  • for the three-month period ended 31 March 2013, with the three-month period ended 31 March 2012 as the comparative period;
  • based on the recognition and measurement criteria of International Financial Reporting Standards as adopted by European Union (‘adopted IFRS’) and on the going concern basis that the Directors consider appropriate (see on the next page); and
  • 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 as at and for the year ended 31 December 2012, which are contained within the 2012 Annual Report and Accounts of the Company, available on the Group’s website at www.newworldresources.eu.

 

 

 

Going concern basis of accounting

The Group manages its liquidity through cash (EUR 193 million (31 December 2012 2012: EUR 267 million)) and a EUR 100 million Revolving Credit Facility (undrawn at 31 March 2013) which is available until February 2014, subject to compliance with certain covenants.

In March/April 2013, the Group agreed revised terms for both the Export Credit Agency (‘ECA’) (EUR 78 million at 31 March 2013) and Revolving Credit Facility (‘RCF’) which suspend testing of covenants until 30 September 2013 and 30 June 2013, respectively. Further information and requirements are described in section 10 Borrowings, Liquidity and Capital Resources.

As a reaction to the continuation of difficult trading conditions and price pressures in 2013, immediate temporary measures are being put in place to safeguard the Group’s liquidity for the foreseeable future. These measures include:

  • reduction in budgeted operating expenses which will result in cash savings of EUR 25 million by year-end, including:

ú  across-the-board 10 per cent salary cut effective 1 May 2013 to save EUR 15 million by year-end;

ú  decrease in contractor costs saving EUR 5 million by year-end;

ú  administrative and material cost cuts.

  • capital expenditure savings and deferrals of EUR 20 million in 2013 on selected coal panel developments and non-critical maintenance. This brings anticipated capital expenditure for the year to EUR 100 million, of which EUR 60 million was incurred in 3M 2013.
  • working capital optimisation saving cash EUR 55 million by year-end, including:

ú  the sale of thermal coal inventories (mostly lower grades of thermal coal and middlings) to one-time customers to generate around EUR 15 million of cash before the year-end;

ú  optimisation of receivables and payables to generate EUR 40 million of cash by year-end.

Taking account of the successful execution of these initiatives and assuming the ECA loan does not need to be repaid (see below), the Group forecasts that it will maintain a minimum cash balance of EUR 140 million over the next twelve months, though this does depend on the implementation of the majority of the working capital optimisation over the next six weeks. In the event that this cannot be achieved the Directors anticipate that the Group may not be able to meet the revised requirements of the ECA and RCF agreements at the end of Q4/Q3 2013, respectively. In any event, the Directors anticipate that, absent a very significant improvement in the price of coking coal, the Group will not be able to meet the covenant requirements of the ECA when testing resumes after 30 September 2013 and will enter into further negotiation with its banks at that time with a view to either agreeing a further deferral of covenant testing or to negotiating replacement facilities.

There can be no guarantee that it will be possible to either agree a further suspension of covenant testing or to agree other facilities. In that event the ECA loan would have to be repaid and the RCF would not be available to the Company. Even taking account of the repayment of the ECA, the Directors anticipate that these initiatives will result in the Group having sufficient liquidity for the foreseeable future, although a significant further deterioration in coal prices, the inability to action the initiatives or any significant operational issues affecting revenue generation could result in a shortfall of funds which would require the Directors to take further cash preserving actions or to seek additional sources of funding.

Based on this analysis, the Directors are of the opinion that the Group has adequate financial resources to continue operating for the foreseeable future (that is until 15 May 2014) and that it is therefore appropriate to continue to adopt the going concern basis in preparing the financial statements.

  1. Significant Accounting Policies

The financial statements have been prepared under the historical cost convention, except for certain financial instruments, which are stated at fair value. 

The financial statements have been prepared on the basis of accounting policies and methods of compilation consistent with those applied in the consolidated financial statements as at and for the year ended 31 December 2012, with the exception described below.  

Change in classification and presentation

With effect from 1 January 2013, the Group has changed the basis on which it presents expenses in the income statement. While previously classified by their nature, expenses are now classified by their function (also known as a ‘Cost of Sales’ format). This change had been made to align better with current best reporting practice in the mining industry.

The reclassifications have no impact on the consolidated operating income or net profit. In the table below, the comparative period has been restated to conform to the current basis of presentation.

(EUR thousand)

Revenues

Cost of sales

Selling expenses

Administrative expenses

Other operating income

Other operating expenses

Operating income

Revenues

346,581

-

-

-

1

-

346,582

Change in inventories of finished goods and work-in-progress

-

(2,587)

(120)

-

-

-

(2,707)

Consumption of material and energy

-

(95,229)

(19)

(1,307)

-

(222)

(96,777)

Service expenses

-

(49,361)

(32,630)

(6,877)

-

(173)

(89,041)

Personnel expenses

-

(78,705)

(872)

(13,268)

-

(153)

(92,998)

Depreciation and amortisation

-

(41,413)

(283)

(1,122)

-

(173)

(42,991)

Net gain from material sold

-

1,555

-

-

-

-

1,555

Gain/(loss) from sale of property, plant and equipment

-

-

-

-

42

-

42

Other operating income

101

101

-

-

586

-

788

Other operating expenses

-

(9,900)

(140)

(3,459)

-

(104)

(13,603)

 

 

 

 

 

 

 

Operating income

346,682

(275,539)

(34,064)

(26,033)

629

(825)

10,850

Cost of sales - comprise all operating costs incurred in production including depreciation and amortisation, or compensation of, and provisions for mining damages.

Selling expenses – comprise all operating costs involved in selling or distribution of products and include mainly transport costs incurred to deliver the coal and coke to customers.

Administrative expenses – comprise all other operating costs associated with general operation of the Group, which cannot be allocated to either cost of sales or selling expenses, and include mainly personnel costs, and advisory costs.

New standards and interpretations

The Group adopted the following amendments to standards and new interpretations, which are effective for its accounting period starting 1 January 2013:

  • Amendment to IAS 1 Financial Statement Presentation – Presentation of Items of Other Comprehensive Income (effective 1 July 2012)
  • Amendment to IAS 19 Employee Benefits (effective 1 January 2013)
  • Amendment to IFRS 7 Financial Instrument: Disclosures - Offsetting Financial Assets and Financial Liabilities (effective 1 January 2013)
  • IFRS 13 Fair Value Measurement (effective 1 January 2013)
  • IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine (effective 1 January 2013)

All of the above have no impact on the Group’s financial position or performance.

Estimates

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 consolidated 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 as at and for the year ended 31 December 2012.

  1. 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 the most significant 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.

  1. Exchange Rates

(EUR/CZK)

3M 2013

3M 2012

y/y %

Average exchange rate

25.566

25.084

2%

End of period exchange rate

25.740

24.730

4%

Throughout this document, the financial results and performance in both the current and comparative periods are expressed in Euros. The financial information could differ considerably if the financial information was presented in CZK. The Company may where deemed relevant, present variances using constant foreign exchange rates (constant currency basis), marked ‘ex-FX’, excluding the estimated effect of currency translation differences. These are non-IFRS financial measures.

 

 

 

 

 

 

 

 

 

 

  1. Financial Performance

Revenues

The Group's largest source of revenue is the sale of coking coal, which accounted for 42% of total revenues in 3M 2013, followed by the sale of thermal coal (28%) and the sale of coke (15%).

(EUR thousand)

3M 2013

3M 2012

y-y

y/y %

ex-FX

External coking coal sales (EXW)*

101,239

182,272

(81,033)

(44%)

(44%)

External thermal coal sales (EXW)*

66,173

75,348

(9,175)

(12%)

(12%)

External coke sales (EXW)*

36,513

47,945

(11,432)

(24%)

(24%)

Coal and coke transport

21,407

27,270

(5,863)

(21%)

(21%)

Sale of coal and coke by-products

9,239

10,318

(1,079)

(10%)

(9%)

Other revenues (restated)

5,553

3,529

2,024

57%

60%

Total revenues

240,124

346,682

(106,558)

(31%)

(30%)

*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 revenues from changes in the underlying achieved price for the products sold.

Total revenues decreased by 31% mainly as a result of lower realised prices, and lower sales volumes of coking coal (see table below), in line with lower prices and demand for steel making materials globally, as well as in our region; followed by lower realised prices for coke and thermal coal. Lower sales volumes also resulted in a decrease of transport revenues, with similar decrease in transport costs, thus EBITDA neutral. The increase 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 in the comparative period.

Average realised sales prices

(EUR per tonne)

3M 2013

3M 2012

y-y

y/y %

ex-FX

Coking coal (EXW)

101

141

(40)

(28%)

(28%)

Thermal coal (EXW)

64

75

(11)

(15%)

(15%)

Coke (EXW)

246

310

(64)

(21%)

(21%)

All of the Group’s coking coal and coke sales are priced quarterly and the majority of thermal coal sales are priced on a calendar year basis.

Total production of coal in 3M 2013 decreased by 10% compared to production volume in 3M 2012. Coal volumes sold to third parties were lower by 11% almost entirely as a result of lower coking coal sales.

Coal inventories decreased by 25kt in 3M 2013 compared to a decrease by 45kt in 3M 2012.

Coal performance indicators (kt)

3M 2013

3M 2012

y-y

y/y %

Coal production

2,147

2,389

(242)

(10%)

External coal sales

2,038

2,289

(251)

(11%)

Coking coal

1,002

1,290

(288)

(22%)

Thermal coal

1,036

999

37

4%

Internal coal sales to OKK

134

140

(6)

(4%)

Period end inventory*

1,262

264

998

378%

* 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 6kt (2012: 9kt).

 

 

Coke production and coke sales decreased by 4% in 3M 2013 compared to the same period in 2012.

Coke inventories decreased by 2kt in 3M 2013 compared to a decrease by 1kt in 3M 2012.

Coke performance indicators (kt)

3M 2013

3M 2012

y-y

y/y %

Coke production

168

175

(7)

(4%)

Coke sales

149

155

(6)

(4%)

Internal consumption

21

21

-

0%

Period end inventory

205

161

44

27%

Cost of Sales

(EUR thousand)

3M 2013

3M 2012

y-y

y/y %

ex-FX

Consumption of material and energy

85,813

95,229

(9,416)

(10%)

(12%)

  of which : mining material and spare parts

42,219

48,346

(6,127)

(13%)

(18%)

              : energy consumption

29,533

29,506

27

0%

2%

              : external coal consumption for coking

9,431

13,240

(3,809)

(29%)

(28%)

Service expenses

44,719

49,291

(4,572)

(9%)

(8%)

  of which : contractors

21,075

25,606

(4,531)

(18%)

(16%)

              : maintenance

9,507

9,992

(485)

(5%)

(4%)

Personnel expenses

75,444

78,705

(3,261)

(4%)

(2%)

Depreciation and amortisation

41,750

41,413

337

1%

3%

Net gain from material sold

(1,326)

(1,555)

229

(15%)

(13%)

Change in inventories of finished goods and work in progress

7,359

2,587

4,772

184%

190%

Other operating expenses/(income)

2,600

9,869

(7,269)

(74%)

(73%)

  of which : compensation of, and provision for mining damages

1,816

6,843

(5,027)

(73%)

(73%)

Total cost of sales

256,359

275,539

(19,180)

(7%)

(6%)

A 7% decrease in total cost of sales results mainly from:

  • decrease in production and development works influencing consumption of mining material and spare parts;
  • lower consumed volumes and lower prices of externally purchased coal needed for the coking operations resulting in decrease of the associated costs;
  • a 14% decrease in the number of shifts and a 3% decrease in unit costs per shift ex-FX resulting in decrease of contractors’ cost (contractors headcount decreased by 12%);
  • a 4% decrease in the number of employees resulting in lower personnel expenses; and
  • lower provision for mining damages resulted from lower production and development works.

Selling Expenses

(EUR thousand)

3M 2013

3M 2012

y-y

y/y %

ex-FX

Transport costs

22,252

29,242

(6,990)

(24%)

(23%)

Personnel expenses

835

872

(37)

(4%)

(2%)

Other expenses

4,227

3,950

277

7%

9%

Total selling expenses

27,314

34,064

(6,750)

(20%)

(19%)

Lower sales volumes together with change in structure of sale districts resulted in a reduction in transport costs by 24%, with similar decrease in transport revenues, thus EBITDA neutral. 

 

Administrative Expenses

(EUR thousand)

3M 2013

3M 2012

y-y

y/y %

ex-FX

Personnel expenses

13,553

13,268

285

2%

4%

Service expenses

5,734

6,877

(1,143)

(17%)

(15%)

Other expenses

2,973

5,888

(2,915)

(50%)

(49%)

Total administrative expenses

22,260

26,033

(3,773)

(14%)

(13%)

Decrease in administrative expenses by 13% on a constant currency basis is principally attributable to lower charitable donations paid in 3M 2013.

Total Personnel Expenses and Headcount

(EUR thousand)

3M 2013

3M 2012

y-y

y/y %

ex-FX

Personnel expenses

90,312

91,382

(1,070)

(1%)

1%

Employee benefit provision

(106)

(60)

(46)

77%

80%

Share-based payments

(218)

1,676

(1,894)

-

-

Total personnel expenses

89,988

92,998

(3,010)

(3%)

(1%)

 

3M 2013

3M 2012

y-y

y/y %

Employees headcount (average)

13,707

14,171

(464)

(3%)

 

   - of which Coal segment

12,947

13,412

(465)

(3%)

 

   - of which Coke segment

731

732

(1)

-

 

Contractors headcount (average)

3,371

3,820

(449)

(12%)

 

Total headcount (average)

17,078

17,991

(913)

(5%)

EBITDA

(EUR thousand)

3M 2013

3M 2012

y-y

y/y %

ex-FX

EBITDA

(22,282)

53,799

(76,081)

-

-

The Group’s EBITDA decreased by EUR 76 million compared to 3M 2012 mainly as a result of lower revenues from all the Group’s products.

As EBITDA is a non-IFRS measure, the following table provides a reconciliation of EBITDA and net (loss)/profit after tax.

(EUR thousand)

3M 2013

3M 2012

Net (loss) / profit after tax

(80,328)

6,184

Income tax

(13,284)

1,611

Net financial expenses

27,824

3,055

Depreciation and amortisation

43,492

42,991

Loss / (gain) from sale of PPE

14

(42)

EBITDA

(22,282)

53,799

Financial Income and Expense

(EUR thousand)

3M 2013

3M 2012

y-y

y/y %

Financial income

(10,731)

(26,356)

15,625

(59%)

Financial expense

38,555

29,411

9,144

31%

 

Net financial expense

27,824

3,055

24,769

811%

The increase in net financial expense of EUR 25 million in 3M 2013 compared to 3M 2012 is mainly attributable to the loss on revaluation of derivatives for which hedge accounting is not applied compared to the gain realised in the comparative period (EUR 16 million) and to the loss recorded due to the repayment of the Senior Notes due 2015 of EUR 8 million, consisting of write off of unamortised transaction costs and fee charged on early redemption.

Loss before Tax

The loss before tax in 3M 2013 was EUR 94 million, a decrease of EUR 102 million compared to a profit of EUR 8 million in 3M 2012.

Income Tax

The Group recorded a net income tax benefit of EUR 13 million in 3M 2013, compared to a net income tax expense of EUR 2 million in 3M 2012, related to the recognition of a deferred tax asset arising from tax losses incurred. The effective tax rate is 14% in 3M 2013 compared to 21% in 3M 2012.

Loss for the Period

The Group recognised a loss of EUR 80 million in the 3M 2013, which represents a decrease of EUR 86 million compared to the profit of EUR 6 million in 3M 2012.

  1. (Loss) / Earnings per Share

(EUR)

3M 2013

3M 2012

A share – basic (loss) / earnings

(0.31)

0.02

A share – diluted (loss) / earnings

(0.31)

0.02

B share – basic earnings

117.40

76.80

B share – diluted earnings

117.40

76.80

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 three-month period ended 31 March:

(EUR thousand)

3M 2013

3M 2012

(Loss) / profit for the period

(80,328)

6,167

(Loss) / profit attributable to A shares

(81,502)

5,399

Profit attributable to B shares

1,174

768

3M 2013

3M 2012

Weighted average number of A shares (basic)

264,648,002

264,380,983

Weighted average number of A shares (diluted)

265,371,035

266,071,455

Weighted average number of B shares (basic)

10,000

10,000

Weighted average number of B shares (diluted)

10,000

10,000

  1. Cash Flow

(EUR thousand)

3M 2013

3M 2012

Net cash flows from operating activities

(22,098)

72,699

Net cash flows from investing activities

(58,956)

(65,168)

Net cash flows from financing activities

8,599

(100,054)

Net effect of currency translation

(1,651)

817

Total decrease in cash

(74,106)

(91,706)

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 3M 2013 was negative EUR 14 million, which was EUR 95 million lower than in 3M 2012, and is in line with lower EBITDA during the reporting period.

Cash Flow from Investing Activities

Capital expenditures amounted to EUR 60 million in 3M 2013, a decrease of EUR 9 million when compared to the same period of 2012. The capital expenditures consist principally of expenditure in the Coal segment, including the development of new mining areas.

Cash Flow from Financing Activities

Cash flow from financing activities was influenced by issuance of new EUR 275 million Senior Notes due 2021 (the ‘2021 Notes’) that were used to repay in full the outstanding amount of EUR 258 million under the Senior Notes due 2015 (the ‘2015 Notes’). Additional transaction costs of EUR 9 million were incurred with the refinancing. The comparative period was influenced by repayment of the RCF of EUR 100 million.  

10.  Borrowings, Liquidity and Capital Resources

The liquidity requirements of the Group arise primarily from working capital requirements, the need to fund capital expenditures and, on a selective basis, possible future acquisitions. The principal uses of cash are anticipated to fund planned operating expenditures, capital expenditures, scheduled principal and interest payments on Senior Notes and other borrowings, and other distributions. 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 shall be sufficient to meet its principal uses of cash.

Senior Notes Issuance

On 23 January 2013, New World Resources N.V. (‘NWR NV’) successfully issued a EUR 275 million Senior Notes due 2021 with a 7.875% coupon. The net proceeds were used to repay in full the outstanding amounts of the 7.375% Senior Notes due 2015, which were repaid on 22 February 2013 in the total amount of EUR 267 million, including accrued interest and call premium.

Financial covenants

The Group agreed with its lenders to suspend and re-set certain financial covenants under the RCF and ECA loan agreements as follows:

  • for ECA (agreed on 28 March 2013), covenant testing is suspended for the period from 1 January 2013 until 30 September 2013. For the period from 1 October 2013 until 31 December 2013, the maximum gearing ratio has been increased from 3.25x to 5x and the minimum fixed cover ratio has been reduced from 3.50x to 2x;
  • for the RCF (agreed on 4 April 2013), covenant testing is suspended for the period from 1 January 2013 until 30 June 2013. For the period from 1 July 2013 until 30 September 2013, the maximum gearing ratio has been increased from 3.25x to 9x and the minimum fixed cover ratio of 3.50x has been reduced to 1x;and
  • in addition to the above suspension and re-set, the agreement with lenders includes a requirement of a minimum cash balance of EUR 110 million be maintained throughout the relevant period as well as limitations on dividends and limitations on incurring senior debt.

The Indenture governing the 7.875% Senior Notes due 2018 (the ‘2018 Notes’) and the Indenture governing the 2021 Notes 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) 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 2018 Notes and the 2021 Notes (the maximum amount of dividends and other restricted payments that could be made) amounted to approximately EUR 113 million as at 31 March 2013.

Indebtedness and liquidity

As at 31 March 2013, the Group held cash and cash equivalents of EUR 193 million and had indebtedness of EUR 836 million, of which EUR 14 million is contractually repayable in the next 12 months. This results in a net debt position for the Group of EUR 643 million, 67% higher when compared to EUR 385 million as at 31 March 2012.

The Group has available a EUR 100 million RCF for future drawdowns until February 2014, provided the Group is in compliance with certain financial covenants.

As a reaction to the continuation of difficult trading conditions and price pressures in 2013, immediate temporary measures are being put in place to safeguard the Group’s liquidity for the foreseeable future. These are described in more detail in section 3 under Going concern basis of accounting. Based on this, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future.

11.  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 the 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 further described in NWR’s 2012 Annual Report and Accounts.


Business Segments

1 January 2013 - 31 March 2013

Mining division

Real Estate division

Eliminations & adjustments2

Group operations total

(EUR thousand)

 

Coal segment

 

Coke segment

 

Other

 

Eliminations & adjustments1

Mining division  - total

RED segment

 

 

 

 

Segment revenues

 

 

 

 

Sales to third parties

 

195,732

 

44,359

 

33

 

-

240,124

-

-

 

240,124

Sales to other segments

 

15,112

 

11

 

286

 

(15,409)

-

191

(191)

 

-

 

 

 

 

 

 

 

 

 

 

 

Total revenues

210,844

 

44,370

 

319

 

(15,409)

 

240,124

 

191

 

(191)

 

240,124

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

(234,775)

 

(36,759)

 

(26)

 

15,010

(256,550)

-

191

 

(256,359)

 

 

 

 

 

 

 

 

 

 

 

Gross (loss) / profit

(23,931)

 

7,611

 

293

 

(399)

 

(16,426)

 

191

 

-

 

(16,235)

 

 

 

 

 

 

 

 

 

 

 

Selling expenses

 

(21,254)

 

(6,071)

 

-

 

11

(27,314)

-

-

 

(27,314)

Administrative expenses

 

(18,242)

 

(1,034)

 

(3,375)

 

391

(22,260)

-

-

 

(22,260)

Other operating income

 

643

 

90

 

-

 

(8)

725

74

-

 

799

Other operating expenses

 

(742)

 

(12)

 

1

 

5

(748)

(30)

-

 

(778)

 

 

 

 

 

 

 

 

 

 

SEGMENT OPERATING (LOSS) / INCOME

(63,526)

 

584

 

(3,081)

 

-

 

(66,023)

 

235

 

-

 

(65,788)

 

 

 

 

 

 

 

 

 

 

EBITDA

(21,689)

 

2,410

 

(3,065)

 

-

 

(22,344)

 

253

 

(191)

 

(22,282)

 

 

 

 

 

 

 

 

 

 

Financial income

 

 

 

 

 

 

 

 

10,499

1,177

(945)

 

10,731

Financial expenses

 

 

 

 

 

 

 

 

(39,499)

(1)

945

 

(38,555)

(Loss) / profit before tax

 

 

 

 

 

 

 

 

 

(95,023)

 

1,411

 

-

 

(93,612)

Income tax benefit / (expense)

 

 

 

 

 

 

 

 

13,521

(237)

-

 

13,284

(LOSS) / PROFIT FOR THE PERIOD

 

 

 

 

 

 

 

 

 

(81,502)

 

1,174

 

-

 

(80,328)

 

 

 

 

 

 

 

 

 

 

Attributable to:

 

 

 

 

 

 

 

 

 

 

Non-controlling interests

 

 

 

 

 

 

 

 

 

-

 

-

 

-

 

-

SHAREHOLDERS OF THE COMPANY

 

 

 

 

 

 

 

 

 

(81,502)

 

1,174

 

-

 

(80,328)

1 Elimination of intercompany transactions within the Mining division (e.g. coal sales, service fees)

2 Elimination of transactions between the divisions (e.g. lease charges, service fees, annual fees for providing real estates)

 

Business Segments

1 January 2013 - 31 March 2013

Mining division

Real Estate division

Eliminations & adjustments2

Group operations total

(EUR thousand)

 

Coal segment

 

Coke segment

 

Other

 

Eliminations & adjustments1

Mining division  - total

RED segment

 

 

 

 

 

 

 

 

 

 

 

Assets and liabilities as at 31 March 2013

 

 

 

 

 

 

 

 

 

 

Total segment assets

 

1,778,739

 

200,220

 

793,176

 

(728,495)

2,043,640

30,159

(14,432)

 

2,059,367

Total segment liabilities

 

1,076,208

 

156,715

 

906,673

 

(728,495)

1,411,101

14,308

(14,432)

 

1,410,977

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other segment information:

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

56,528

 

2,971

 

30

 

-

59,529

-

-

 

59,529

Depreciation and amortisation

 

41,834

 

1,828

 

17

 

-

43,679

4

(191)

 

43,492

Interest income

 

294

 

3

 

11,628

 

(11,456)

469

1

-

 

470

Interest income - divisional CAP

 

-

 

-

 

-

 

-

-

945

(945)

 

-

Interest expense

 

9,566

 

2,222

 

15,897

 

(11,456)

16,229

-

-

 

16,229

Interest expense - divisional CAP

 

846

 

99

 

-

 

-

945

-

(945)

-

1 Elimination of intercompany transactions within the Mining division (e.g. coal sales, service fees)

2 Elimination of transactions between the divisions (e.g. lease charges, service fees, annual fees for providing real estates)


large table 

Business Segments

1 January 2012 - 31 March 2012 (restated)

Mining division

Real Estate division

Eliminations & adjustments2

Group operations total

(EUR thousand)

 

Coal segment

 

Coke segment

 

Other

 

Eliminations & adjustments1

Mining division  - total

RED segment

 

 

 

 

Segment revenues

 

 

 

 

Sales to third parties

 

290,2843

 

56,2793

 

1193

 

-

346,682

-

-

 

346,682

Sales to other segments

 

21,319

 

23

 

345

 

(21,687)

-

193

(193)

 

-

 

 

 

 

 

 

 

 

 

 

 

Total revenues

311,603

 

56,302

 

464

 

(21,687)

 

346,682

 

193

 

(193)

 

346,682

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

(250,612)

 

(46,475)

 

(7)

 

21,362

(275,732)

-

193

 

(275,539)

 

 

 

 

 

 

 

 

 

 

 

Gross profit / (loss)

60,991

 

9,827

 

457

 

(325)

 

70,950

 

193

 

-

 

71,143

 

 

 

 

 

 

 

 

 

 

 

Selling expenses

 

(28,006)

 

(6,100)

 

-

 

42

(34,064)

-

-

 

(34,064)

Administrative expenses

 

(21,508)

 

(1,068)

 

(3,755)

 

298

(26,033)

-

-

 

(26,033)

Other operating income

 

414

 

104

 

-

 

(16)

502

127

-

 

629

Other operating expenses

 

(817)

 

(4)

 

-

 

1

(820)

(5)

-

 

(825)

 

 

 

 

 

 

 

 

 

 

SEGMENT OPERATING INCOME / (LOSS)

11,074

 

2,759

 

(3,298)

 

-

 

10,535

 

315

 

-

 

10,850

 

 

 

 

 

 

 

 

 

 

EBITDA

51,857

 

5,129

 

(3,277)

 

-

 

53,709

 

283

 

(193)

 

53,799

 

 

 

 

 

 

 

 

 

 

Financial income

 

 

 

 

 

 

 

 

26,393

929

(966)

 

26,356

Financial expenses

 

 

 

 

 

 

 

 

(30,108)

(269)

966

 

(29,411)

Profit before tax

 

 

 

 

 

 

 

 

 

6,820

 

975

 

-

 

7,795

Income tax expense

 

 

 

 

 

 

 

 

(1,404)

(207)

-

 

(1,611)

PROFIT FOR THE PERIOD

 

 

 

 

 

 

 

 

 

5,416

 

768

 

-

 

6,184

 

 

 

 

 

 

 

 

 

 

Attributable to:

 

 

 

 

 

 

 

 

 

 

Non-controlling interests

 

 

 

 

 

 

 

 

 

17

 

-

 

-

 

17

SHAREHOLDERS OF THE COMPANY

 

 

 

 

 

 

 

 

 

5,399

 

768

 

-

 

6,167

1 Elimination of intercompany transactions within the Mining division (e.g. coal sales, service fees)

2 Elimination of transactions between the divisions (e.g. lease charges, service fees, annual fees for providing real estates)

3 Prior to 3M 2012, the results of foreign exchange hedging arising on Coal and Coke segment had been excluded from segment results and included in other information. In 3M 2013, the results are included in the segment results and the comparatives for 3M 2012 have been conformed to this basis resulting in lower revenues in Coal segment by EUR 2,258 thousand, in Coke segment by EUR 835 thousand, with corresponding adjustment in other information.

 

Business Segments

1 January 2012 - 31 March 2012

Mining division

Real Estate division

Eliminations & adjustments2

Group operations total

(EUR thousand)

 

Coal segment

 

Coke segment

 

Other

 

Eliminations & adjustments1

Mining division  - total

RED segment

 

 

 

 

 

 

 

 

 

 

 

Assets and liabilities as at 31 March 2012

 

 

 

 

 

 

 

 

 

 

Total segment assets

 

1,970,846

 

215,765

 

841,721

 

(712,686)

2,315,646

27,521

(15,082)

 

2,328,085

Total segment liabilities

 

1,002,885

 

160,821

 

1,054,389

 

(712,686)

1,505,409

15,239

(15,082)

 

1,505,566

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other segment information:

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

64,803

 

3,837

 

-

 

-

68,640

-

-

 

68,640

Depreciation and amortisation

 

40,790

 

2,369

 

21

 

-

43,180

4

(193)

 

42,991

Interest income

 

660

 

2

 

9,882

 

(9,593)

951

8

-

 

959

Interest income - divisional CAP

 

-

 

-

 

-

 

-