Corsa Coal announces 2Q17 results
Published by Louise Mulhall,
Corsa Coal Corp., a premium quality metallurgical, thermal and industrial coal producer, has reported financial results for the three and six months ended 30 June, 2017 and announced the results of its annual and special meeting of shareholders.
Corsa Coal Corp., a premium quality metallurgical, thermal and industrial coal producer, has reported financial results for the three and six months ended June 30, 2017 and announced the results of its annual and special meeting of shareholders. Corsa has filed its unaudited Condensed Interim Consolidated Financial Statements for the three and six months ended 30 June, 2017 and 2016 and related Management’s Discussion and Analysis under its profile on www.sedar.com. An updated investor presentation has been added to www.corsacoal.com.
- Corsa reported positive net and comprehensive income of US$4.6 million for the second quarter of 2017, an increase of 157% from the second quarter of 2016. Revenues were US$66.2 million, an increase of 255% from the second quarter of 2016.
- Corsa achieved adjusted EBITDA(1) of US$12.1 million and US$11.3 million at its Northern Appalachia Division (NAPP) and on a consolidated basis, respectively, for the three months ended 30 June, 2017.
- Corsa achieved an average realised price per short ton of metallurgical coal sold(1) of US$121.77 in the second quarter 2017, an increase of 101% as compared to the second quarter of 2016. This average realised price is the approximate equivalent of US$167 to US$170 on an FOB terminal basis(4).
- Metallurgical coal sales volumes increased 35% in the second quarter of 2017 as compared to the first quarter of 2017 and 178% compared to the second quarter of 2016. This marks the fifth consecutive quarter of above 20% or greater growth in metallurgical coal sales volumes.
- For the second quarter of 2017, Corsa’s operations demonstrated exceptional safety performance again, with violation per inspection day rates less than half of the Mine Safety and Health Administration’s (MSHA) national average and a lost time accident frequency rate that is comparable to the MSHA national average for coal mines.
- The Acosta Mine successfully commenced production in early June 2017, consistent with previous guidance. Early indications are positive from a geologic, equipment and hiring standpoint. Production from the Acosta Mine will increase over the second half of 2017, as additional shifts are added and a second mining unit is added.
Key operating metrics
George Dethlefsen, Chief Executive Officer of Corsa, commented:
“Corsa made excellent progress towards its growth objectives in the second quarter. The Acosta Mine successfully opened in early June and is progressing according to plan with favorable geology and productivity levels. Metallurgical coal production at the NAPP Division was at the highest level in two years, driven largely by outstanding productivity at the Casselman mine.
Corsa’s Sales & Trading platform achieved its fifth consecutive quarter of at least 20% sequential volume growth for sales of metallurgical coal. We are pleased to have picked up two new orders from domestic customers in the quarter and now expect a fairly balanced order book between domestic and international sales in the months ahead. As a result of the progress of our sales efforts, today we are increasing 2017 metallurgical coal sales guidance by approximately 20%.
We are thrilled to announce that we will soon begin rehabilitation work at the Horning Mine near Somerset, Pennsylvania. This project involves re-opening a mine that has been idled for five years, and marks the second mine opening project that Corsa has begun in the last year. The project is consistent with our strategy of increasing capacity use at company-owned preparation plants in Pennsylvania.
The metallurgical coal market is in very tight supply globally, with particular tightness in low volatile metallurgical coal supply in the US. Spot metallurgical coal prices have risen sharply in July and August, as supply disruptions in Australia and the US and coal production restrictions in China have taken tonnage out of the market. In a change from the recent surges in metallurgical coal prices which were primarily supply driven, steel demand has been a major contributor to increased demand for metallurgical coal. We expect a continued strong market for steel production in the second half of the year and into 2018.
Looking forward, we remain focused on both metallurgical coal production growth and growth in Sales and Trading volumes.Production from the Acosta Mine will ramp up over the third and fourth quarters of this year. We are currently evaluating additional expansion opportunities from our portfolio of projects located within economic trucking distance of our coal preparation plant capacity in Pennsylvania. Finally, we are evaluating ways to deploy the free cash flow that the business is generating. Production growth, acquisitions, and deleveraging remain strategic priorities.”
Read the article online at: https://www.worldcoal.com/coal/18082017/corsa-coal-announces-2q17-results/
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