CANONSBURG, PA, March 7,
2017 /CNW/ - Corsa Coal Corp. (TSXV: CSO) ("Corsa" or the
"Company"), a premium quality metallurgical, thermal and industrial
coal producer, today reported financial results for the three
months and full year ended December
31, 2016. Corsa has filed its audited consolidated
financial statements for the years ended December 31, 2016 and 2015, related management's
discussion and analysis and its annual information form under its
profile on www.sedar.com, as well as updated technical reports for
its Northern Appalachia ("NAPP") Division and Central Appalachia
("CAPP") Division properties.
Unless otherwise noted, all dollar amounts in this news release
are expressed in United States
dollars and all ton amounts are short tons (2,000 pounds per
ton).
Fourth Quarter 2016 and Full Year 2016 Highlights
- In 2016, Corsa achieved its operational goals by significantly
reducing cash production cost per ton sold at both divisions and
achieving industry-leading safety and regulatory compliance rates.
- Corsa's operations continued to achieve industry leading safety
performance in 2016, with violation per inspection day (VPID) rates
that were almost 50% lower than the MSHA national average and a
lost time accident frequency rate that was almost 75% lower than
the MSHA national average for coal mines.
- NAPP Division variable cost reduction efforts have been
successful with the cash production cost per ton sold(1)
for metallurgical coal decreasing 7.8% [from $67.68 to $62.39] in 2016 compared to the prior
year.
- NAPP Division fixed costs(2) were reduced by
$14.2 million in 2016 compared to the
prior year, as a result of successful negotiations with third
parties, reductions in idle mine costs, water treatment costs,
general and administrative expenses and a successful asset sales
program.
- CAPP Division variable cost reduction efforts have also been
successful with cash production cost per ton sold(1) for
thermal and industrial coal decreasing 12.6% [from $57.53 to $50.29] in 2016 compared to the prior
year.
- Spot prices for metallurgical coal rose by approximately 200%
over the course of 2016, leading to an average realized price per
ton of metallurgical coal sold(1) of $101.99 in the fourth quarter of 2016 despite 35%
of Corsa's fourth quarter 2016 metallurgical coal sales being sold
on a fixed price domestic contract with pricing negotiated in late
2015 in a lower price environment.
- Metallurgical coal sales volumes increased 37% in the fourth
quarter of 2016 as compared to the third quarter of 2016, marking
the third consecutive quarter of nearly 25% or greater of growth in
metallurgical coal sales volumes.
- In September 2016, Corsa
commenced development work at the Acosta Deep Mine in Somerset County, Pennsylvania, which is
forecasted to produce 400,000 tons per year of low volatile
metallurgical coal once fully operational. Coal production at the
mine is anticipated to begin in the second quarter of 2017 and ramp
up over the course of 2017.
- Corsa achieved positive adjusted EBITDA 1) of
$6,663,000 and $5,359,000 at its NAPP Division for the three and
twelve months ended December 31,
2016, respectively; $1,486,000
and $3,329,000 at its CAPP Division
for the three and twelve months ended December 31, 2016, respectively; and $7,239,000 and $5,358,000 on a consolidated basis for the three
and twelve months ended December 31,
2016.
- In October 2016, Corsa raised
CDN$ 23.0 million by way of a private
placement of 11,500,000 common shares of the Company (the "Common
Shares") (post-consolidation basis) to fund mine development and
for general corporate and working capital purposes.
- For the full year 2016, Corsa raised $26,468,000 of equity, net of issuance costs, by
way of three private placements.
- In September 2016, the Company
was notified that it was awarded $3,000,000 in funding under the Pennsylvania
Redevelopment Assistance Capital Program to develop an underground
coal mine in Somerset County
subject to certain conditions, including but not limited to: (i)
completing the Redevelopment Assistance application; (ii)
confirmation that at least 50% of the required non-state funds
necessary to complete the project are secured at the time of
application; (iii) execution of a grant agreement; and (iv)
commencement of construction within six months of the grant
agreement. Once all the aforementioned conditions have been met,
the grant will be released on a periodic basis and the Company will
be reimbursed for certain expenditures which the Company will
offset against the capitalized development costs.
- Corsa reached a settlement with the United States Environmental
Protection Agency and the Pennsylvania Department of Environmental
Protection on the alleged Clean Water Act violations in the amount
of $6.5 million. The entire
$6.5 million was released from an
escrow that was established in connection with the Company's
acquisition of PBS Coals, Inc. The Company was also reimbursed for
its legal expenses from this escrow. As a result of this escrow
release, the settlement of this matter had no impact to the cash
flows of Corsa.
- Corsa completed a share consolidation on the basis of one (1)
post-consolidation Common Share for each 20 pre-consolidation
Common Shares effective on December 7,
2016.
- Key Operating Metrics:
|
|
For the three
months ended
|
|
|
|
December 31,
2016
|
|
|
(in thousands
except per ton amounts)
|
|
NAPP -
Metallurgical Coal
|
|
|
NAPP -
Thermal Coal
|
|
|
CAPP
|
|
|
Tons sold
|
|
242
|
|
|
66
|
|
|
151
|
|
|
|
|
|
|
|
|
|
Realized price per
ton sold(1)
|
|
$
|
101.99
|
|
|
$
|
45.20
|
|
|
$
|
58.83
|
|
|
Cash production cost
per ton sold(1)
|
|
67.05
|
|
|
$
|
37.74
|
|
|
44.95
|
|
|
Cash margin per ton
sold(1)
|
|
$
|
34.94
|
|
|
$
|
7.46
|
|
|
$
|
13.88
|
|
|
|
For the year
ended
|
|
|
|
December 31,
2016
|
|
|
(in thousands
except per ton amounts)
|
|
NAPP -
Metallurgical Coal
|
|
|
NAPP -
Thermal Coal
|
|
|
CAPP
|
|
|
Tons sold
|
|
669
|
|
|
235
|
|
|
499
|
|
|
|
|
|
|
|
|
|
Realized price per
ton sold(1)
|
|
$
|
79.66
|
|
|
$
|
40.85
|
|
|
$
|
59.95
|
|
|
Cash production cost
per ton sold(1)
|
|
62.39
|
|
|
42.83
|
|
|
50.29
|
|
|
Cash margin per ton
sold(1)
|
|
$
|
17.27
|
|
|
$
|
(1.98)
|
|
|
$
|
9.66
|
|
|
|
|
(1)
|
This is a non-GAAP
financial measure. See "Non-GAAP Financial Measures"
below.
|
|
(2)
|
Fixed costs include
the following: idle mine expense, corporate and administrative
expense, non-financed maintenance and growth capital expenditures,
reclamation and water treatment cash payments, cash collateral
release related to reclamation bonds, restricted cash contributions
to the Global Treatment Trust Fund, debt service payments, cash
collateral funding for workers' compensation, transportation
contract liquidated damages payments, bond premiums and proceeds
from asset sales.
|
George Dethlefsen, Corsa's Chief
Executive Officer, commented, "2016 marked a year of operational
achievement for Corsa Coal, as the company set a company record for
safety performance, reduced production costs per ton at both
operating divisions, drove meaningful reductions in fixed costs,
and grew quarter-over-quarter metallurgical sales volumes by over
25% for each of the last three quarters of the year. We enter
2017 on firm financial footing, with low levels of debt, strong
profit margins and a positive free cash flow outlook for the
business.
Average realized metallurgical coal prices are expected to
increase by approximately 50% in the first quarter of 2017, as
legacy contracts roll off and as Corsa's export volumes
increase. Demand for metallurgical coal exports from
the United States remains high, as
we believe the global seaborne market remains in a supply
deficit. The decline in seaborne metallurgical coal prices
seen in December through mid-February has turned around in recent
weeks as inventory destocking has reversed and we are seeing
increased solicitations for shipments both domestically and
internationally. On the strength of higher steel and coke
prices and expectations for increased infrastructure spending, we
expect demand growth to be a major story in 2017 for metallurgical
coal.
Executing on the Company's strategy of growth, both through
organic development and through acquisitions, remains a top
priority. The development of the Acosta Deep Mine is on
schedule for a second quarter 2017 start date and the project is
fully financed with cash on hand. We will begin work at two
surface mines at the NAPP Division in the second quarter of 2017
and are evaluating additional low volatile metallurgical coal mines
in our portfolio for additional growth. Additionally, we have
added a crew to the Quecreek Mine and upgraded mining equipment at
the Casselman Mine, both of which should lead to higher production
levels moving forward. Corsa's growth will be driven by our
portfolio of permitted mines, our emerging sales and trading
platform, our customer relationships, and our existing preparation
plant infrastructure at the NAPP Division, which can accommodate
throughput of four million saleable tons per year."
Financial and Operations Summary
|
|
For the three
months ended
|
|
For the year
ended
|
|
|
December
31,
|
|
December
31,
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
|
|
Increase
|
|
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
|
2016
|
|
2015
|
|
|
(Decrease)
|
|
|
Revenues
(000's)
|
|
$
|
37,728
|
|
|
$
|
26,564
|
|
|
$
|
11,164
|
|
|
$
|
96,986
|
|
|
$
|
129,342
|
|
|
$
|
(32,356)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales(2) (000's)
|
|
$
|
42,291
|
|
|
$
|
129,650
|
|
|
$
|
(87,359)
|
|
|
$
|
110,170
|
|
|
$
|
262,573
|
|
|
$
|
(152,403)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate and
administrative expense (000's)
|
|
$
|
4,208
|
|
|
$
|
2,999
|
|
|
$
|
1,209
|
|
|
$
|
13,234
|
|
|
$
|
15,514
|
|
|
$
|
(2,280)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net and comprehensive
income (loss) for the period (000's)
|
|
$
|
(10,685)
|
|
|
$
|
(106,354)
|
|
|
$
|
95,669
|
|
|
$
|
(34,140)
|
|
|
$
|
(152,989)
|
|
|
$
|
118,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1) (000's)
|
|
$
|
7,239
|
|
|
$
|
14
|
|
|
$
|
7,225
|
|
|
$
|
5,358
|
|
|
$
|
1,667
|
|
|
$
|
3,691
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash provided by
(used in) operating activities (000's)
|
|
$
|
3,991
|
|
|
$
|
(2,517)
|
|
|
$
|
6,508
|
|
|
$
|
(2,719)
|
|
|
$
|
8,981
|
|
|
$
|
(11,700)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Coal sold - tons
(000's)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAPP – metallurgical
coal
|
|
242
|
|
|
171
|
|
|
71
|
|
|
669
|
|
|
740
|
|
|
(71)
|
|
|
NAPP – thermal
coal
|
|
66
|
|
|
49
|
|
|
17
|
|
|
235
|
|
|
135
|
|
|
100
|
|
|
CAPP
|
|
151
|
|
|
149
|
|
|
2
|
|
|
499
|
|
|
761
|
|
|
(262)
|
|
|
Total
|
|
459
|
|
|
369
|
|
|
90
|
|
|
1,403
|
|
|
1,636
|
|
|
(233)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized price per
ton sold(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAPP – metallurgical
coal
|
|
$
|
101.99
|
|
|
$
|
69.15
|
|
|
$
|
32.84
|
|
|
$
|
79.66
|
|
|
$
|
77.11
|
|
|
$
|
2.55
|
|
|
NAPP – thermal
coal
|
|
$
|
45.20
|
|
|
$
|
48.04
|
|
|
$
|
(2.84)
|
|
|
$
|
40.85
|
|
|
$
|
44.03
|
|
|
$
|
(3.18)
|
|
|
CAPP
|
|
$
|
58.83
|
|
|
$
|
65.18
|
|
|
$
|
(6.35)
|
|
|
$
|
59.95
|
|
|
$
|
66.53
|
|
|
$
|
(6.58)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash production cost
per ton sold(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAPP – metallurgical
coal
|
|
$
|
67.05
|
|
|
$
|
62.11
|
|
|
$
|
(4.94)
|
|
|
$
|
62.39
|
|
|
$
|
67.68
|
|
|
$
|
5.29
|
|
|
NAPP – thermal
coal
|
|
$
|
37.74
|
|
|
$
|
30.20
|
|
|
$
|
(7.54)
|
|
|
$
|
42.83
|
|
|
$
|
32.06
|
|
|
$
|
(10.77)
|
|
|
CAPP
|
|
$
|
44.95
|
|
|
$
|
56.19
|
|
|
$
|
11.24
|
|
|
$
|
50.29
|
|
|
$
|
57.53
|
|
|
$
|
7.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash margin per ton
sold(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAPP – metallurgical
coal
|
|
$
|
34.94
|
|
|
$
|
7.04
|
|
|
$
|
27.90
|
|
|
$
|
17.27
|
|
|
$
|
9.43
|
|
|
$
|
7.84
|
|
|
NAPP – thermal
coal
|
|
$
|
7.46
|
|
|
$
|
17.84
|
|
|
$
|
(10.38)
|
|
|
$
|
(1.98)
|
|
|
$
|
11.97
|
|
|
$
|
(13.95)
|
|
|
CAPP
|
|
$
|
13.88
|
|
|
$
|
8.99
|
|
|
$
|
4.89
|
|
|
$
|
9.66
|
|
|
$
|
9.00
|
|
|
$
|
0.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1) (000's)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAPP
|
|
$
|
6,663
|
|
|
$
|
222
|
|
|
$
|
6,441
|
|
|
$
|
5,359
|
|
|
$
|
2,022
|
|
|
$
|
3,337
|
|
|
CAPP
|
|
1,486
|
|
|
575
|
|
|
911
|
|
|
3,329
|
|
|
4,058
|
|
|
(729)
|
|
|
Corporate
|
|
(910)
|
|
|
(783)
|
|
|
(127)
|
|
|
(3,330)
|
|
|
(4,413)
|
|
|
1,083
|
|
|
Total
|
|
$
|
7,239
|
|
|
$
|
14
|
|
|
$
|
7,225
|
|
|
$
|
5,358
|
|
|
$
|
1,667
|
|
|
$
|
3,691
|
|
|
|
(1) This
is a non-GAAP financial measure. See "Non-GAAP Financial
Measures" below.
|
|
(2) Cost
of sales consists of the following:
|
|
|
For the three
months ended
|
|
For the year
ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Mining and processing
costs
|
|
$
|
18,407
|
|
|
$
|
18,433
|
|
|
$
|
62,913
|
|
|
$
|
89,353
|
|
|
Purchased coal
costs
|
|
5,376
|
|
|
548
|
|
|
8,459
|
|
|
3,693
|
|
|
Royalty
expense
|
|
1,721
|
|
|
1,662
|
|
|
5,561
|
|
|
8,766
|
|
|
Amortization
expense
|
|
7,000
|
|
|
13,590
|
|
|
18,884
|
|
|
35,450
|
|
|
Transportation costs
from preparation plant to customer
|
|
1,178
|
|
|
2,476
|
|
|
4,097
|
|
|
10,592
|
|
|
Idle mine
expense
|
|
579
|
|
|
947
|
|
|
1,658
|
|
|
4,077
|
|
|
Change in estimate of
reclamation provision for non-operating properties
|
|
2,769
|
|
|
(23,776)
|
|
|
2,769
|
|
|
(22,985)
|
|
|
Impairment and
write-off of mineral properties
|
|
—
|
|
|
115,241
|
|
|
—
|
|
|
131,772
|
|
|
Write-off of advance
royalties and other assets
|
|
997
|
|
|
529
|
|
|
1,228
|
|
|
1,417
|
|
|
Obsolete inventory
reserve - parts and supply inventory
|
|
3,523
|
|
|
—
|
|
|
3,523
|
|
|
—
|
|
|
Other
costs
|
|
741
|
|
|
—
|
|
|
1,078
|
|
|
438
|
|
|
|
$
|
42,291
|
|
|
$
|
129,650
|
|
|
$
|
110,170
|
|
|
$
|
262,573
|
|
Guidance
Guidance for the three months ending March 31, 2017 and year ending December 31, 2017 is as follows:
|
|
|
|
(all dollar
amounts in U.S. dollars and tonnage in short tons)
|
Q1
2017
|
Full Year
2017
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
|
Total Sales
Tons
|
|
|
|
|
|
Metallurgical
|
270,000
|
|
300,000
|
|
1,325,000
|
|
1,475,000
|
|
|
Thermal
|
190,000
|
|
250,000
|
|
625,000
|
|
725,000
|
|
|
|
|
|
|
|
NAPP Division Sales
Tons
|
|
|
|
|
|
Metallurgical
|
270,000
|
|
300,000
|
|
1,200,000
|
|
1,300,000
|
|
|
Thermal
|
40,000
|
|
50,000
|
|
75,000
|
|
125,000
|
|
|
|
|
|
|
|
NAPP Division Met
Coal Revenue/Ton Sold(1)
|
90% Fixed at
$158
|
N/A
|
N/A
|
|
|
|
|
|
|
NAPP Division Met
Cash Production Cost / Ton Sold(1)(2)
|
$
|
70.00
|
|
$
|
75.00
|
|
$
|
65.00
|
|
$
|
70.00
|
|
|
|
|
|
|
|
NAPP Division Met
Cash Cost / Ton Sold(1)(3)
|
$
|
80.00
|
|
$
|
85.00
|
|
N/A
|
N/A
|
|
|
|
|
|
|
CAPP Division Sales
Tons
|
|
|
|
|
|
Metallurgical
|
N/A
|
N/A
|
125,000
|
|
175,000
|
|
|
Thermal
|
150,000
|
|
200,000
|
|
550,000
|
|
600,000
|
|
|
|
|
|
|
|
CAPP Division Coal
Revenue / Ton Sold(1)
|
|
|
|
|
|
Metallurgical
|
N/A
|
N/A
|
N/A
|
N/A
|
|
Thermal
|
90% Fixed at
$55
|
N/A
|
N/A
|
|
|
|
|
|
|
CAPP Division Cash
Production Cost / Ton Sold(1)(2)
|
|
|
|
|
|
Metallurgical
|
N/A
|
N/A
|
$
|
70.00
|
|
$
|
75.00
|
|
|
Thermal
|
$
|
57.50
|
|
$
|
62.50
|
|
$
|
50.00
|
|
$
|
55.00
|
|
|
|
|
|
|
|
CAPP Division Cash
Cost / Ton Sold(1)(3)
|
|
|
|
|
|
Metallurgical
|
N/A
|
N/A
|
N/A
|
N/A
|
|
Thermal
|
$
|
52.50
|
|
$
|
57.50
|
|
N/A
|
N/A
|
|
|
(1) This
is a non-GAAP financial measure. See "Non-GAAP Financial
Measures" below.
|
|
(2) Cash
Production Cost / Ton Sold excludes purchased coal.
|
|
(3) Cash
Cost / Ton Sold includes purchased coal.
|
Coal Pricing Trends and Outlook
NAPP Division
Spot prices for metallurgical coal rose by approximately 200%
over the course of 2016. Chinese policy initiatives to reduce
production of coal, in addition to supply disruptions in
Australia, created a deficit of
metallurgical coal on the seaborne market in the second half of
2016. The rebound in pricing caused a supply response to
occur in coal exporting countries such as Australia, the
United States, and Mongolia. A large scale metallurgical supply
response is expected to be slow, as major Australian and Canadian
mines are already running near maximum capacity. Incremental
production from greenfield and brownfield projects may take up to
two years or longer to come online as permits are acquired,
equipment is ordered, mines are staffed, and coal producers raise
capital to fund the projects. Additionally, historically low
metallurgical coal prices during the period of time from 2014
through mid-2016, led to a lack of investment in reserves,
infrastructure, new mining permits, and equipment, all of which
will slow the supply response to higher prices.
The first quarter 2017 benchmark followed with another
significant uptick to $285 per metric
ton from the fourth quarter 2016's benchmark price of $200 per metric ton. Spot prices declined
in December 2016 through February 2017 as Australian mines that were
disrupted in the fall of 2016 returned to production, inventory
destocking occurred in China and
India, as the Chinese relaxed the
276 workday policy and went back to a 330 workday policy for the
winter months. Spot prices for premium quality low volatile
metallurgical coal in the United
States and Asia are
currently in the $150 to $165 per
metric ton range. Steel prices have risen globally over the
past several months and blast furnace restarts in North America could lead to additional demand
for metallurgical coal in 2017. Policy initiatives to
increase infrastructure spending in the
United States and China and
a recovery in domestic oil and gas drilling activity, are two
catalysts that could lead to additional demand for metallurgical
coal in the quarters ahead.
Corsa's geographic proximity to over 50% of domestic coke
production capacity and short rail distance and multiple options to
access the Baltimore export
terminals will continue to solidify Corsa's ability to serve both
domestic and international customers.
Corsa's metallurgical coal sales in 2017 from its NAPP Division
are expected to be in the range of 1,200,000 to 1,300,000 tons.
Approximately 45% of these sales are currently committed at the
midpoint of the range. Actual sales will depend on customer demand
and market conditions.
Corsa's thermal coal sales in 2017 from its NAPP Division are
expected to be in the range of 75,000 to 125,000 tons and are
expected to be filled by coal purchased from third parties.
100% of these sales are currently committed at the midpoint of the
range. Actual sales will depend on customer demand and market
conditions. We do not expect to sell internally-produced NAPP
Division coal on the thermal market in 2017.
CAPP Division
Southeastern U.S. utility market thermal coal spot pricing
improved 20% over the course of 2016. Spot pricing today is
approximately $57 per ton for 12,500
BTU thermal coal. General supply reductions in Central
Appalachia, in addition to increased natural gas prices in 2016,
led to an improvement in pricing. Additionally, the increased
price of metallurgical coal caused some crossover thermal coal to
enter the metallurgical market, further reducing supply of thermal
coal regionally.
The CAPP Division mineral reserve base exclusively consists of
high British Thermal Unit ("BTU") and high carbon content coal.
These unique qualities, combined with advantaged logistics, set the
CAPP Division apart from other producers and create a niche in the
utility and industrial marketplace.
The CAPP Division thermal and industrial coal sales for 2017 are
expected to be in the range of 550,000 to 600,000 tons. 100% of
these sales are currently committed at the midpoint of the
range. The CAPP Division metallurgical coal sales for 2017
are expected to be in the range of 125,000 to 175,000 tons.
Approximately 23% of these sales are currently committed at the
midpoint of the range. Actual sales will depend on customer demand
and market conditions.
Stock Options Granted
Corsa also announces that its Board of Directors has granted
stock options to purchase a total of 150,000 common shares of Corsa
(the "Common Shares") to certain employees of Corsa, which grant
represents approximately 0.2% of the total outstanding Common
Shares. These options were granted in accordance with Corsa's
Amended and Restated Option Plan (the "Option Plan"), are
exercisable for five years at a price of the higher of (a)
C$2.40, being the closing price of
the Common Shares on the TSX Venture Exchange ("TSX-V") on
March 6, 2017 and (b) the closing
price of the Common Shares on the TSX-V on March 9, 2017 being the date following Corsa's
"blackout" period in connection with its annual financial
statements, and are subject to the terms and conditions of the
Option Plan and TSX-V approval. Such options will vest
one-third on the first anniversary of the date of grant, one-third
on the second anniversary of the date of grant and one-third
on the third anniversary of the date of grant.
Non-GAAP Measures
Management uses realized price per ton sold, cash production
cost per ton sold and adjusted EBITDA as internal measurements of
operating performance for Corsa's mining and processing
operations. Management believes these non-GAAP measures
provide useful information for investors as they provide
information in addition to the GAAP measures to assist in their
evaluation of the operating performance of Corsa. Reference
is made to the management's discussion and analysis for the three
months and full year ended December 31,
2016 for a reconciliation of non-GAAP measures to GAAP
measures.
Financial Statements and Management's Discussion and
Analysis
Refer to Corsa's audited consolidated financial statements for
the years ended December 31, 2016 and
2015 and related management's discussion and analysis, filed under
Corsa's profile on www.sedar.com for details of the financial
performance of Corsa and the matters referred to in this news
release.
Caution
The estimated coal sales, projected market conditions and
potential development disclosed in this news release are considered
to be forward looking information. Readers are cautioned that
actual results may vary from this forward looking
information. Actual sales are subject to variation based on a
number of risks and other factors referred to under the heading
"Forward-Looking Statements" below as well as demand and sales
orders received.
Information about Corsa
Corsa is a coal mining company focused on the production and
sales of metallurgical coal, an essential ingredient in the
production of steel. Our core business is producing and selling
metallurgical coal to domestic and international steel and coke
producers in the Atlantic and Pacific basin markets. Corsa also
offers high heat content, low delivered cost coal to major
utilities and industrial users in the Southeast region of the
U.S.
Forward-Looking Statements
Certain information set
forth in this press release contains "forward-looking statements"
and "forward-looking information" under applicable securities laws.
Except for statements of historical fact, certain information
contained herein relating to projected sales, coal prices, coal
production, mine development, the capacity and recovery of Corsa's
preparation plants, expected cash production costs, geological
conditions, future capital expenditures and expectations of market
demand for coal, constitutes forward-looking statements which
include management's assessment of future plans and operations and
are based on current internal expectations, estimates, projections,
assumptions and beliefs, which may prove to be incorrect. Some of
the forward-looking statements may be identified by words such as
"estimates", "expects" "anticipates", "believes", "projects",
"plans", "capacity", "hope", "forecast", "anticipate", "could" and
similar expressions. These statements are not guarantees of future
performance and undue reliance should not be placed on them. Such
forward-looking statements necessarily involve known and unknown
risks and uncertainties, which may cause Corsa's actual performance
and financial results in future periods to differ materially from
any projections of future performance or results expressed or
implied by such forward-looking statements. These risks and
uncertainties include, but are not limited to: risks that the
actual production or sales for the 2017 fiscal year will be less
than projected production or sales for this period; risks that the
prices for coal sales will be less than projected; liabilities
inherent in coal mine development and production; geological,
mining and processing technical problems; inability to obtain
required mine licenses, mine permits and regulatory approvals or
renewals required in connection with the mining and processing of
coal; risks that Corsa's preparation plants will not operate at
production capacity during the relevant period, unexpected changes
in coal quality and specification; variations in the coal mine or
preparation plant recovery rates; dependence on third party coal
transportation systems; competition for, among other things,
capital, acquisitions of reserves, undeveloped lands and skilled
personnel; incorrect assessments of the value of acquisitions;
changes in commodity prices and exchange rates; changes in the
regulations in respect to the use, mining and processing of coal;
changes in regulations on refuse disposal; the effects of
competition and pricing pressures in the coal market; the
oversupply of, or lack of demand for, coal; inability of management
to secure coal sales or third party purchase contracts; currency
and interest rate fluctuations; various events which could disrupt
operations and/or the transportation of coal products, including
labor stoppages and severe weather conditions; the demand for and
availability of rail, port and other transportation services; the
ability to purchase third party coal for processing and delivery
under purchase agreements; and management's ability to anticipate
and manage the foregoing factors and risks. The forward-looking
statements and information contained in this press release are
based on certain assumptions regarding, among other things, coal
sales being consistent with expectations; future prices for coal;
future currency and exchange rates; Corsa's ability to generate
sufficient cash flow from operations and access capital markets to
meet its future obligations; the regulatory framework representing
royalties, taxes and environmental matters in the countries in
which Corsa conducts business; coal production levels; Corsa's
ability to retain qualified staff and equipment in a cost-efficient
manner to meet its demand; and Corsa being able to execute its
program of operational improvement and initiatives. There can be no
assurance that forward-looking statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. The reader is
cautioned not to place undue reliance on forward-looking
statements. Corsa does not undertake to update any of the
forward-looking statements contained in this press release unless
required by law. The statements as to Corsa's capacity to produce
coal are no assurance that it will achieve these levels of
production or that it will be able to achieve these sales
levels.
The TSX Venture Exchange has in no way passed on the
merits of this news release. Neither TSX Venture Exchange nor
its Regulation Services Provider (as that term is defined in
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
SOURCE Corsa Coal Corp.
