WSL - Wescoal Holdings Limited - Trading Update
WESCOAL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2005/006913/06)
(JSE code: WSL ISIN: ZAE000069639)
("Wescoal" or "the company")
In terms of the Listings Requirements of the JSE Limited ("JSE"), section
3.4(b), companies are required to publish a trading statement as soon as they
are satisfied that a reasonable degree of certainty exists that the financial
results for the period will differ by at least 20% from the financial results
for the previous corresponding period.
Shareholders are advised that the company expects earnings per share for the
year ended 31 March 2011 to decrease from 4.57 cents to a loss per share of
between 26.2 cents and 32.0 cents as compared to the comparative period.
Headline earnings per share for the year ended 31 March 2011 is expected to
decrease from 4.28 cents to a loss per share of between 23.3 cents and 28.5
cents as compared to the comparative period.
The decrease in earnings is primarily due to:
- Write off of all mining costs incurred at the Sutha operation at Khanyisa
- Reduced production and increased costs due to flooding in the quarter
ended 31 March 2011;
- Reduced production resulting in losses at the Blesboklaagte washing
- Accelerated write off of mining in progress and mine establishment costs;
- Impairment of goodwill in Chandler Coal (Pty) Limited.
Khanyisa Colliery returned to full production during April 2011 and a change
in mining methods will prevent future flooding at the operation.
To date, no action has been launched by Sutha Civils (Pty) Limited ("Sutha")
to substantiate and demand the money they very publicly claimed was due to
them. Wescoal did however approach the court in March 2011 to interdict Sutha
from continuing to make unsubstantiated and derogatory statements to the
media. An interim order was granted and should be made final during July 2011.
Blesboklaagte washing operation stopped production at the end of March 2011
and the sale of the plant is currently being finalized.
The financial information on which this trading statement is based has not
been reviewed or reported on by the company`s auditors.
24 June 2011
Date: 24/06/2011 17:15:01 Supplied by www.sharenet.co.za
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