Bogdanka after the first quarter of 2020: lower extraction but high yield
LW BOGDANKA S.A. published financial results for Q1 2020. Consolidated revenue for that period amounted to PLN 464.1 million, EBITDA – PLN 134.8 million, operating profit – PLN 44.9 million, and net profit – PLN 33.7 million.
In Q1 2020 the Company performed its production plan at a level of 2.1 million tonnes (compared to 2.5 million tonnes the year before) and sales plan at a level of 1.9 million tonnes (2.4 million tonnes in Q1 2020). In Q1, the average yield amounted to the high level of 65.7%, in comparison to 64.7% the year before.
The Company’s results in Q1 2020 are primarily a consequence of adjusting production to the reduced demand for coal from our customers due to a warm and windy winter. It is worth emphasising that last year’s comparability base was very high, as in Q1 2019 the results were shaped by several favourable factors, including the record-breaking output in January 2019. The developing epidemic of SARS-Cov-2 coronavirus causing the COVID-19 disease did not materially affect our operations in Q1 2020, said
- said Artur Wasil, President of the Management Board of LW BOGDANKA SA
The Company retains its strong market position achieving at the end of the first quarter the share in the market of thermal coal sales of 20.6%, and the share in the market of thermal coal sales to commercial power plants of 25.8%. 83% of our sales in Q1 were performed within the Enea Group, i.e. to Enea Wytwarzanie sp. z o.o. and Enea Elektrownia Połaniec S.A.
In Q1, the Company completed 6.7 kilometres of galleries compared to 7.9 kilometres the year before, which met the Company’s assumptions. In the previous quarter, the LW BOGDANKA Group had investment expenditure of PLN 266.3 million. The largest portion of this sum, nearly PLN 166 million, was used for the purchase of new longwall systems. Nearly PLN 73 million were used for new excavations and modernisation of the existing ones.
PLN` 000 | QI 2020 | Q1 2019 | Change | QI 2018 |
|---|---|---|---|---|
Net revenue | 464 081 | 540 787 | - 14,2% | 398 697 |
EBITDA | 134 807 | 222 860 | -39,5% | 127 476 |
EBIT | 44 894 | 127 966 | -64,9% | 28 509 |
Net profit | 33 668 | 109 969 | -69,4% | 23 169 |
Currently, similarly to the whole economy, we function in the shadow of the coronavirus pandemic and do our best to mitigate its impact on our operations. We have quickly addressed the situation by implementing a number of procedures and protective measures, thanks to which we have thus far not observed instances of disease among our employees. At the same time we have maintained the continuity of operations in all areas. It is very difficult to predict how the situation will develop, and what adverse consequences (if any) will be for the Company’s operating activity and its results. We focus on providing a high level of security while maintaining the continuity of extraction and preparatory works. We hope the situation will gradually stabilize but we are also prepared to face the possible challenges of this year by making use of our advantages: the highest efficiency of extraction among the Polish coal mines, solid financial results reached over the years, lack of debts, and making part of the Enea Group
- added Artur Wasil.
Lubelski Węgiel Bogdanka S.A. is a leading hard coal producer in Poland that stands apart from its peers in terms of its modern and efficient mining. It is one of the largest Polish hard coal mines. Lubelski Węgiel Bogdanka S.A. chiefly conducts mining operations in terms of hard coal extraction, enrichment and sales. It supplies this raw material mainly to industrial offtakers. Supply contracts are long-term, and the product is sold to the commercial power sector and the industrial power sector.
The company has been listed on the Warsaw Stock Exchange since June of 2009. In August 2022, Lubelski Węgiel Bogdanka S.A. returned to listing on the WIG-ESG Index.
Since October of 2015 Bogdanka has been a member of the Enea Group, the second largest player on Poland’s electrical power market in terms of the generation of electricity, which manages the entire value chain on the electricity market ranging from fuel to the generation of electricity, distribution, sales (supply) and customer service.