News Archive

08 October 2009

Pre-Close Trading Statement

ATH Resources plc, one of the UK's largest coal producers, today issues the following trading update ahead of the Group's preliminary results for the year ended 4 October 2009, which will be announced on Wednesday 9 December 2009.

Sales for the full year are 1.8 million tonnes, around 100,000 tonnes lower than previous expectations. Full production was resumed in late August at the Group's mine at Muir Dean, Fife, following the implementation of an ongoing comprehensive water reduction plan to deal with the groundwater inflow into part of the mine experienced earlier in the year. Production at other sites was maximised in the second half of the year but, due to exceptionally wet weather during August and early September, which hampered the opening up of two mine extensions at Skares and Glenmuckloch, the full amount of lost production was not entirely replaced.  Average prices continued to increase during the year to over £42 per tonne.

The reduction in sales volumes will, to a limited extent, result in the profit for the year being below the Directors' expectations although, as planned, debt levels reduced by £5 million in the second half, to around £40 million.

Planning consent was received in August for a 600,000 tonnes extension to the Skares mine which, together with the previously approved 330,000 tonnes extension at Glenmuckloch is now operating satisfactorily.

In June, a planning application for an 800,000 tonnes site at Duncanziemuir, adjacent to the Group's Laigh Glenmuir mine, was submitted to East Ayrshire Council. Determination of this application is expected during the first half of 2010.

In September, the appeal commenced against the previously announced decision by Derbyshire County Council to refuse planning permission for the 500,000 tonne coal reclamation scheme at Langton. The Directors expect that the decision by the Planning Inspectorate will be available before the end of December 2009 which, if positive, will allow production to commence in the second quarter of the 2010 calendar year.

The Group had estimated Proven and Probable Reserves at 4 October 2009 of 4.7 million tonnes and 3.5 million tonnes respectively. This follows a recent addition of 1.8 million tonnes to Probable Reserves arising from a mine in East Ayrshire.

Total Reserves increased by more than 1 million tonnes to 8.2 million tonnes since the half-year, an increase of over 15%.

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Notes to Editors

ATH Resources is an AIM-listed operator of surface coal mines in the UK with five operational mines in Scotland; Skares Road, Grievehill and Laigh Glenmuir in East Ayrshire, Glenmuckloch in Dumfries and Galloway and Muir Dean in Fife. The Company is currently the third largest producer of coal in the UK, producing approximately 2 million tonnes per annum. Coal is used to generate around a third of the UK's electricity and the Company now holds coal supply contracts with four of the UK's main electricity generating companies.

The management team has been in place since 1998. It acquired the rights to operate (and subsequently acquire) the Skares Road mine with support from The Alchemy Plan. Following ATH Resources' incorporation in October 2003, and backed by a follow on investment from The Alchemy Plan, the Company acquired the Garleffan mine in November 2003. Garleffan is currently being restored having finished coaling in June 2006. ATH Resources listed on the AIM market of the London Stock Exchange in June 2004.

In June 2005, having raised £18 million by way of an Open Offer, the Group acquired two new opencast sites, Grievehill and Glenmuckloch in Scotland. The acquisition increased the Group's reserve base by 160%.

In May 2006, the Group acquired ATH Regeneration, a successful coal recovery, land remediation and regeneration business with a particular focus on colliery spoil heap reclamation projects. The acquisition, which was earnings enhancing, allowed ATH to build on its skills as a regenerator of land, whilst developing strong relationships with key English planning authorities. The Company has been successfully integrated into the Group. The operational diversification that the acquisition brings to the Group will be a significant driver of ATH's organic growth going forward both in the UK and overseas and the business is actively pursuing a number of projects in Australia.

For the year ending 28 September 2008, the Group achieved turnover of £76.9 million, an increase of 9% on its 2007 year end, whilst operating profit increased by 7% to £11.9m for the same period.

Further information on ATH Resources can be found at www.ath.co.uk.