TIDMAPF
RNS Number : 0476O
Anglo Pacific Group PLC
02 November 2016
News Release
November 2, 2016
Anglo Pacific Group PLC
Q3 2016 Trading Update
Anglo Pacific Group PLC ("Anglo Pacific", the "Company" or the
"Group") (LSE: APF, TSX: APY), the London and Toronto listed
royalty company, issues the following trading update for the period
July 1, 2016 to November 1, 2016. Unless otherwise stated, all
unaudited financial information is for the quarter ended September
30, 2016.
Q3 2016 Highlights
-- Royalty related income of GBP4.7m in Q3 2016 (Q3
2015: GBP1.9m), an increase of 147%
-- Royalty related income of GBP9.0m for the nine
months ended September 30, 2016 (nine months ended
September 30, 2015: GBP5.7m; and FY2015: GBP8.7m),
an increase of 58%
-- Cash and cash equivalents of GBP4.0m as at September
30, 2016 (December 31, 2015: GBP5.7m) and net
debt of GBP8.2m as at September 30, 2016 (December
31, 2015: GBP1.8m), both prior to receipt of Q3
2016 royalty income
Outlook
-- Significant increases in both coking and thermal
coal prices since the half year, with spot prices
up 229% and 110% year to date respectively, which
should benefit royalty income in Q4 2016
-- Royalty income for 2016 expected to be considerably
higher than previous expectations
-- Net debt currently stands at GBP4.2m following
receipt of the Q3 2016 royalty income
-- Currency hedging measures implemented to protect
a significant portion of forecast next six months'
Australian dollar income at spot rates of approximately
GBP:AUD 1.60, following the continued weakness
of sterling post the outcome of the EU referendum
-- Full dividend cover now expected for 2016 ahead
of previous guidance, and acceleration in the
timeframe when the Group can consider gradually
increasing its dividend
Julian Treger, Chief Executive Officer of the Company,
commented:
"We are delighted by the Group's progress this year, underlined
by the significant increase in royalty income which is already
ahead of 2015 as a whole. Encouragingly, we believe that more good
news is still to come in Q4 2016, when increased coal prices and
mining in our royalty areas should benefit the Company still
further.
"With the outlook for robust coal prices set to continue through
H1 2017, we look forward to the corresponding benefit to our
dividend cover. We remain very excited about the Group's prospects,
as Anglo Pacific continues to be one of the only listed royalty
companies that provides such high levels of exposure to coking coal
price increases."
Trading update additional information
-- Increase in income for the first nine months of
2015 has been driven largely by increases in volume
in the Group's royalty land at Kestrel and the
weakness of the sterling (sterling is approximately
20% lower against the Australian dollar compared
to the level at the beginning of the year), with
the full benefit of recent coal price increases
expected to come through in the final quarter
of the year
-- Although Rio Tinto has not published the price
at which they have contracted coking coal sales
for Q4 2016, both Peabody and Glencore have settled
contracts at US$200/t. This marks a 117% increase
on the Q3 2016 contract price of $92/t. Should
Rio Tinto achieve this price, when combined with
the majority of production at Kestrel expected
to be within Anglo Pacific's land in Q4 2016,
Anglo Pacific can reasonably expect a much higher
amount of royalty income in Q4 2016 compared to
expectations at the half year. The company will
make an announcement to the market in due course
once the coking coal price has been set for Q4
2016.
-- Although the coking coal price increase has been
most pronounced, the price of thermal coal is
also up sharply as is the price of intermediate
quality PCI coal. The royalty the Group acquired
in March 2015 over the Narrabri mine should thus
also show considerable growth in Q4 2016
For further information:
Anglo Pacific Group PLC +44 (0) 20 3435 7400
Julian Treger - Chief Executive
Officer
Kevin Flynn - Chief Financial
Officer and Company Secretary
Website: www.anglopacificgroup.com
BMO Capital Markets Limited +44 (0) 20 7664 8020
Jeffrey Couch / Neil Haycock /
Tom Rider
Macquarie Capital (Europe) Limited +44 (0) 20 3037 2000
Raj Khatri / Nicholas Harland / Ariel
Tepperman
Peel Hunt LLP +44 (0) 20 7418 8900
Matthew Armitt / Ross Allister
Bell Pottinger +44 (0) 20 3772 2500
Nick Lambert / Lorna Cobbett
Notes to Editors
About Anglo Pacific
Anglo Pacific Group PLC is a global natural resources royalty
company. The Company's strategy is to develop a leading
international diversified royalty company with a portfolio centred
on base metals and bulk materials, focusing on accelerating income
growth through acquiring royalties on projects that are currently
cash flow generating or are expected to be within the next 24
months. It is a continuing policy of the Company to pay a
substantial portion of these royalties to shareholders as
dividends.
Cautionary statement on forward-looking statements and related
information
Certain information contained in this announcement, including
any information as to future financial or operating performance and
other statements that express management's expectation or estimates
of future performance, constitute "forward looking statements". The
words "expects", "anticipates", "plans", "believes", "estimates",
"seeks", "intends", "targets", "projects", "forecasts", or negative
versions thereof and other similar expressions identify
forward-looking statements. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that,
while considered reasonable by management, are inherently subject
to significant business, economic and competitive uncertainties and
contingencies. Further, forward-looking statements are not
guarantees of future performance and involve risks and
uncertainties which could cause actual results to differ materially
from those anticipated, estimated or intended in the
forward-looking statements. Furthermore, this announcement contains
information and statements that are based on certain estimates and
forecasts that have been provided to the Group by Kestrel Coal Pty
Ltd ("KCPL"), the accuracy of which KCPL does not warrant and on
which readers may not rely. The material assumptions and risks
relevant to the forward-looking statements in this announcement
include, but are not limited to: stability of the global economy;
stability of local government and legislative background;
continuing of ongoing operations at the properties underlying the
Group's portfolio of royalties in a manner consistent with past
practice; accuracy of public statements and disclosures (including
feasibility studies and estimates of reserve, resource, production,
grades, mine life, and cash cost) made by the owners and operators
of such underlying properties; accuracy of the information provided
to the Group by the owners and operators of such underlying
properties; no material adverse change in the price of the
commodities produced from the properties underlying the Group's
portfolio of royalties and investments; no material adverse change
in foreign exchange exposure; no adverse development in respect of
any property in which the Group holds a royalty or other interest,
including but not limited to unusual or unexpected geological
formations and natural disasters; successful completion of new
development projects; planned expansions or additional projects
being within the timelines anticipated and at anticipated
production levels; and maintenance of mining title. If any such
risks actually occur, they could materially adversely affect the
Group's business, financial condition or results of operations. For
additional information with respect to such risks and
uncertainties, please refer to the "Principal Risks and
Uncertainties" section of our most recent Annual Report and to the
"Risk Factors" section of our most recent Annual Information Form
available on www.sedar.com and the Group's website
www.anglopacificgroup.com. Readers are cautioned to consider these
and other factors, uncertainties and potential events carefully and
not to put undue reliance on forward-looking statements. The
forward-looking statements contained in this announcement are made
as of the date of this announcement only and the Group undertakes
no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events
or otherwise, after the date on which the statements are made or to
reflect the occurrence of unanticipated events.
Third party information
As a royalty holder, the Group often has limited, if any, access
to non-public scientific and technical information in respect of
the properties underlying its portfolio of royalties, or such
information is subject to confidentiality provisions. As such, in
preparing this announcement, the Group has largely relied upon the
public disclosures of the owners and operators of the properties
underlying its portfolio of royalties, as available at the date of
this announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
TSTUASBRNWAARAA
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