News Archive

22 May 2009

Trading Update

ATH Resources plc (AIM:ATH), one of the UK's largest coal producers, today announces that, following a recent unexpected and substantial inflow of water into part of the Group's mine at Muir Dean in Fife, it intends to defer the payment of the interim dividend for the current financial year which was anticipated to be paid in July 2009. Whilst coal production from the Muir Dean mine is continuing, the increase in water levels has temporarily reduced coal output to well below expectations. In the circumstances, the Directors believe that it is prudent to defer the payment of the interim dividend and, accordingly, the Group intends to incorporate this into the final dividend expected to be paid in January 2010.

Following the implementation of a comprehensive water reduction plan, water levels in the mine are currently returning to previously expected levels, which will allow full scale production to recommence later in the summer. Plans are in place to maximise production from other sites and at this stage the Directors do not expect that the temporary reduction in output will have a significant impact on the Group's ability to achieve its market expectations for the full year or have any adverse impact on banking facilities or associated covenants.

A further update will be given in the announcement of the Group's interim results on 9 June 2009.

Commenting on the decision, Tom Allchurch, Chief Executive of ATH Resources said: "It is disappointing that the substantial inflow of water at Muir Dean will have a significant short-term affect on our production at Muir Dean. The Board has therefore taken the prudent decision to defer the interim dividend payment in order to retain funds within the Group." 

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Notes to Editors

ATH Resources was listed on the AIM market of the London Stock Exchange in June 2004 and operates five surface coal mines in Scotland; Skares Road, Grievehill and Laigh Glenmuir in East Ayrshire, Glenmuckloch in Dumfries and Galloway and Muir Dean in Fife. The Group 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.

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 Resources 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 8% to £11.9m for the same period.

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