BISICHI MINING PLC
Interim Management Statement
Published 16 November 2009 07:00:00
Interim Management Statement
Bisichi Mining PLC (‘Bisichi’), the UK mining company with direct coal mining
operations in South Africa, is pleased to provide the following update about
its operations.
As stated in the Half Yearly Report, we remain positive about the profitability
in 2010 of the Black Wattle Colliery (‘Black Wattle’), our direct coal mining
operation in South Africa. Nevertheless, as we reported to shareholders in the
Half Year Report, trading profits in the second half of 2009 are not going to
be as strong as in the first half. This is for several reasons:
* Black Wattle carried out the planned closure of most of its underground
mining sections in favour of increasing production from its opencast
operations. We are pleased to report that this planned closure is now
complete. The average monthly production in the first half of the year was
130,000 tonnes per month. The average monthly production to date in the
second half of the year is 90,000 tonnes per month. This is a direct result
of this planned closure. We will see the benefits of the increased
production from our opencast operations in 2010.
* Black Wattle carried out the planned closure of one opencast pit and has
opened up the next.
* A strong SA Rand has continued to put downward pressure on US Dollar
revenues.
Looking forward to 2010, management anticipate an increase in profitability and
are pleased to report the following:
* Black Wattle has completed the expansion of its washing plant from capacity
of 130,000 metric tonnes per month to 170,000 metric tonnes per month. This
will allow increased production.
* Black Wattle has finalised a three year fixed price coal supply contract
for 900,000 tonnes of its export steam coal product to be supplied evenly
over three years commencing January 2010. The fixed price was based on the
higher forward prices and was secured at a significant premium to the
current coal price.
* The planned expansion of the rail siding jointly owned by Black Wattle has
been completed. The siding upgrade includes an additional line and
stockpile area, which allows for increased throughput capacity.
Finally, income from Bisichi’s UK properties remains steady, with no
significant change from the first half.
Mr Andrew Heller, Managing Director of Bisichi said: ‘With our robust cash
position and the general overall strength of our balance sheet, the flexibility
of our opencast operations and the increased capacity of both the washing plant
and rail siding, we are well-positioned to take advantage of opportunities
which we anticipate will arise next year.’
END
For further information, please call:
Andrew Heller, Bisichi Mining PLC 020 7415 5030
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