X Continue

Cookie file regulations.
A system of cookie files is in place on our website to ensure top-quality services suited to your individual needs. If you use the website without adjusting your cookies settings, cookie files will be stored on your device. Cookie settings may be changed at any time. For more information, see our Cookies Policy.

Lubelski Węgiel
Lubelski Węgiel Bogdanka S.A.

LW BOGDANKA after Y2011

Tuesday, 2012-03-20
PRESS RELEASE
Bogdanka, 20 March 2012


LUBELSKI WĘGIEL BOGDANKA S.A. in 2011
SURGE IN MINING IN Q4

Lubelski Węgiel BOGDANKA S.A., one of the largest and most advanced hard coal mines in Poland and one of the leaders of the domestic market for power coal producers, has completed its investment tasks. In October 2011 the Company started mining operations in the Stefanów Field, obtaining in the fourth quarter 2 million tonnes of commercial coal compared to 1 million in the fourth quarter of 2010. The total production last year amounting to PLN 5,838,400 tonnes exceeded the hitherto record result of 5,800,030 tonnes of 2010.

The net profit of the LW BOGDANKA Group for 2011 amounted to PLN 221.25 million compared to PLN 230.12 million in 2010 (decrease of 3.86%). The operating profit for the same period amounting to PLN 265.74 million was lower by 3.88% than in 2010, when the Company’s EBIT was at a level of PLN 276.47 million.
EBITDA of the LW BOGDANKA Group grew by 8.7% from PLN 414.55 million in 2010 to PLN 450.60 million in 2011.

The Group achieved those results with revenue on sales of over PLN 1.30 billion, which was by 5.76% higher than in 2010 (over PLN 1,23 billion), with completing the investment tasks in 2011 in the amount of PLN 690.53 million.

One of the main strategic objectives of the Company for 2012 remains to continue the tasks aimed at achieving the planned level of coal extraction of 11.5 million tonnes per annum in 2014, and thus doubling its share in the market of power coal producers in Poland.

FINANCIAL RESULTS - DETAILS


Detailed financial results of the LW BOGDANKA Group after four quarters of 2011 are presented in the table below:



PLN'000
1 - 4Q
2011
 1 - 4Q
2010
Change
[%]
 Revenue on sales 1 301 349 1 230 447 5.76
 Gross profit 384 653 409 684 -6.11
 EBITDA 450 603 414 548 8.70
Operating profit 265 739 276 472 -3.88
 Net profit 221 246 230 122 -3.86


During four quarters of 2011, the Lubelski Węgiel BOGDANKA Group's revenue on sales was PLN 1,301,349,000, which represents an increase of 5.76%, or by PLN 70,902,000, compared to the same period of the previous year.

EBITDA (operating profit before depreciation/amortisation) for the period from 1 January 2011 to 31 December 2011 grew by 8.70% and amounted to PLN 450,603,000 compared to PLN 414,548,000 in the same period of 2010.

For 12 months of 2011 the Group recorded a decrease in operating profit of 3.88% on a year-to-year basis, which is a consequence of higher costs of products, goods and materials sold, comprising among others: an increase in the costs of external services, an increase in the costs of materials and energy consumption (in connection with preparing and starting mining operations in the Stefanów Field), an increase in the costs of remunerations (higher average employment) and an increase in the costs of depreciation (in 2011 the Company made available for use some assets connected with the launch of mining operations in the Stefanów Field, also the first panel in the Stefanów Field was started up – this translated into higher natural depreciation).

In the very fourth quarter of 2011, having started mining operations in the Stefanów Field, the Group obtained revenue in the amount of PLN 435,588,000, or higher by 47.05% than in the same period of the previous year.


REVENUE ON SALES OF THE LW BOGDANKA GROUP - STRUCTURE BY PRODUCT TYPES

The main source of the LW BOGDANKA Group's revenue on sales in 2011 was the production and sale of power coal (94.11% of the sales revenue achieved by the Group with 96.80% in 2010).



Item
 1 - 4Q
2011
Share
[%]
1 - 4Q
2010
Share
[%]
Sales of coal 1 224 690 94.11 1 191 016 96.80
Sales of ceramics 8 678 0.66
 7 868 0.64
Other activities 43 807 3.37 22 442 1.82
Sales of goods and materials 24 174 1.86 9 121 0.74
 Total revenue on sales 1 301 349 100.00
 1 230 447 100.00


More than 80% of coal sales realised in the analysed period of 2011 (as well as in the same period of the previous year) were carried out on the basis of long-term commercial agreements between LW BOGDANKA and its key customers, including Elektrownia Kozienice S.A., the ENEA Group, Elektrownia Połaniec S.A. - GDF Suez Energia S.A., ENERGA Elektrownia Ostrołęka S.A. and the Ożarów Group.

The increase in the revenue on sales of coal in 2011 is a consequence of higher volumes of coal sold (+3.68%), with only slightly higher sale unit price.

Revenue on other activities accounted in that period for 3.37% compared to 1.82% a year ago, and was connected mostly with coal transport services provided by the Company to one of the customers and revenue on lease of tangible fixed assets.


PROFITABILITY RATIOS OF THE LW BOGDANKA GROUP



 Item 1 - 4Q
2011
 1 - 4Q
2010
 Change
[p.p.]
2011 - 2010
Gross margin on sales
 29.56% 33.30% - 3.74
EBITDA
 34.63% 33.69% 0.94
EBIT
 20.42% 22.47% - 2.05
Gross margin
 20.90% 23.42% - 2.52
Net margin
 17.00% 18.70% - 1.70
Return on Assets
 7.49% 8.69% - 1.20
 Return on Equity
 10.76% 12.41% - 1.65


During the four quarters of 2011, all profitability ratios (except for EBITDA) achieved lower values than in the same period of the previous year.

EBITDA of the LW BOGDANKA Group increased from 33.69% in 2010 to 34.63% in 2011. The change in value of the ratio was caused by depreciation growing from PLN 138,076,000 in 2010 to PLN 184,864,000 in 2011.
The decrease in the gross margin on sales from 33.30% to 29.56% was affected by lower (in nominal terms) increase in the generated revenue in relation to the incurred costs of products, goods and materials – this also translated into a decreased gross profit on an annual basis.

The decrease in the return on assets (from 8.69% to 7.49%) resulted from lower net profit and higher average fixed assets disclosed in the Group’s annual consolidated financial statements. The Group, and particularly the Company, manufactures assets which will bring economic benefits in the subsequent periods.

Similarly as was the case with the return on assets, the decrease in the return on equity resulted from lower net profit (by 3.86%), with equity concurrently going up (by 8.82%). The effects of using equity for financing the Group’s operations will be visible in the subsequent reporting periods.

PRODUCTION CAPACITY OF THE LW BOGDANKA GROUP

During four quarters of 2011 (as in the previous years), the revenue on sales generated by the LW BOGDANKA Group were primarily determined by the Company's production (extraction) capacity.
In October 2011 the Company started production in the Stefanów Field. A coal-ploughing complex installed in panel 385/1, which is 305 metres long, with the total panel length of 5,070 metres started to be operated. The extraction and ventilation shaft was made available for use, equipped with tubs having capacity of 40 tonnes each. Optimisation of the equipment operation enabled to reach the speed of 18 metres per second in transporting coal from underground to the surface. Also the coal transport system, the so called bridge from the Stefanów Field to Bogdanka, was commissioned for use. Work was continued at the second stage of development of the Mechanical Coal Processing Plant. The exploitation of coal deposits in Stefanów allowed the Company to achieve in the fourth quarter of 2011 record monthly levels of coal extraction: 543,000 tonnes (net) of commercial coal in October, 699,000 tonnes in November, and 763,000 tonnes in December.

INVESTMENT PLANS OF LW BOGDANKA

Investment projects completed in 2011 amounted to PLN 690.53 million, for 2012 this figure is planned to be PLN 719.33 million.

The table below presents investments completed in 2011 and investment plans broken up into tasks:




Investment projects2011
Plan
2011
Completion
2012
Plan
 [PLN'000]
 [PLN'000] [PLN'000]
Gr.1
Development investments
(development of the Stefanów Field)
437 369 384 308235 666
 A
Technical infrastructure
(shaft 2.1, development of MCPP, other)
303 682 246 439136 719
 BMaking coal seams available in the Stefanów Field133 687 137 86998 947
Gr.2
Other development investments1 0000
7 220
Gr.3
 Replacement investments 105 988 101 63748 944
 AModernisations and repair of machines and devices 34 631 33 59526 810
 B 
Building and modernisation of structure and installation
71 357
68 042
22 134
Gr.4
Environmental protection 2 125 1 5278 425
Gr.5
Building and modernisation of workings in the Bogdanka, Nadrybie and Stefanów Fields 121 206
 116 389137 683
Gr.6
Purchase of machines and devices 121 715 86 668
281 388
 Total789 403 690 529719 326


The main objective of the investment plan for 2011 was to continue commenced tasks, aiming at doubling the output in 2014. Implementation of the plan enabled the Company to start mining using shaft 2.1 in the Stefanów Field in 2011.
Investment expenditure for 2011 was planned in the amount of PLN 789,403,000.

The Company’s investment plans in 2012 comprise investments in technical infrastructure, including:
  • completing the construction of storage reservoirs next to shaft 2.1 in the Stefanów Field,
  • completing the construction of construction facilities of the Stefanów Field, i.e. manoeuvring yard and fencing of the field,
  • central air conditioning system of the Stefanów Field - extension,
  • completing extension of the Mechanical Coal Processing Plant in order to achieve processing capacities at a level of 2,400 t/d and extension of the coal storage area,
  • further development and replacement investments and work connected with making coal seams available (among others things, drilling of main gate workings for the start-up of the other panel in seam 385/2)

“Last year we struggled with time, difficult mining and geological conditions, optimisation of working parameters for new plant and machinery, and delays in schedule of works carried out by subcontractors. We waited for the first coal from the Stefanów Field, which was hauled to the surface in August 2011. Full production was commenced in October. Engineers from Bogdanka implemented a number of innovative solutions in the systems for the excavated material, transport and dry processing of raw material, which brought about a surge in coal mining in the fourth quarter. This shows the real capacity potential of LW BOGDANKA S.A., which will be systematically and consistently increased,” Mirosław Taras, President of Management Board.




For more information, contact:

Tomasz Zięba
Press Spokesman of LW Bogdanka S.A.
Tel. (81) 462 56 04
e-mail: tzieba@lw.com.pl


back
Calendar
Today is:
13 of August 2020
Name day of:
Elwiry, Hipolita, Radosławy
© LW „Bogdanka” S.A. - 2018
Realization: Data Flow sp. z o.o.