Corsa Coal Announces 2015 Financial Results

Corsa Coal (TSXV:CSO) has reported its financial results for 2015, highlighting a positive adjusted EBITDA despite low coal prices.
As quoted in the press release:

Fourth Quarter 2015 and Full Year 2015 Highlights

• Despite a challenging coal pricing environment, Corsa achieved positive adjusted EBITDA⁽¹⁾ of $222,000 and $2,022,000 at its Northern Appalachia Division (“NAPP”) for the three and twelve months ended December 31, 2015, respectively, $575,000 and $4,058,000 at its Central Appalachia (“CAPP”) Division for the three and twelve months ended December 31, 2015, respectively, and $14,000 and $1,667,000 on a consolidated basis for the three and twelve months ended December 31, 2015.
• NAPP productivity improvements and cost reduction efforts have been successful in outpacing the decline in average realized coal prices, with the cash production cost per ton sold⁽¹⁾ for metallurgical coal decreasing over 20% [from $84.87 to $67.68] in 2015 compared to 2014  versus a 17% decline in average realized sales price per ton sold [from $92.39 to $77.11] year over year.  These efforts led to cash operating margin and adjusted EBITDA rising in 2015 versus 2014 levels.
• Corsa’s operations continue to achieve industry leading safety performance, with violation per inspection day rates that are 50% lower than the U.S. national average.
• NAPP continues to aggressively manage its cost structure. With the exception of the Horning Mine, the mines idled during the first quarter 2015, as well as other inactive deep mining operations, were sealed in an effort to significantly reduce idle mine costs. NAPP incurred idle mine costs of $2,939,000 during 2015, which is expected to dramatically decline in 2016 as a result of these mines being sealed. Additionally, Corsa successfully consolidated its coal processing plants in the second quarter 2015 and again during the fourth quarter 2015, resulting in significant operating cost savings. Successful efforts have been undertaken to reduce general and administrative expenses, reclamation and water treatment expenses at NAPP, and general and administrative expenses at Corsa’s Corporate Division.
• CAPP has also substantially completed the mine development for the Cooper Ridge Deep Mine which is expected to enter full production during the second quarter of 2016. This mine is expected to strategically reposition CAPP into the specialty coal and industrial coal markets which typically generate premium pricing.
• Over the course of 2015, Corsa restructured its senior management team by appointing Peter Merritts to the role of President – NAPP and appointing Kevin Harrigan to the role of Chief Financial Officer and Corporate Secretary.
• In October 2015, Corsa raised $7.25 million from its three significant institutional investors by way of private placement to fund working capital and for general corporate purposes.
• In March 2016, Corsa raised $8 million from its largest three investors as well as its senior lender by way of a non-brokered private placement of common shares to fund working capital and for general corporate purposes.
• Key Operating Metrics for the three months ended December 31, 2015:
  • NAPP metallurgical coal sales of 171,000 tons.
  • NAPP realized price per ton sold⁽¹⁾ for metallurgical coal of $69.15.
  • NAPP cash production cost per ton sold⁽¹⁾ for metallurgical coal of $62.11, an improvement of 34% over the prior year comparable quarter.
  • CAPP thermal coal sales of 149,000 tons.
  • CAPP realized price per ton sold⁽¹⁾ for thermal coal of $65.18.
  • CAPP cash production cost per ton sold⁽¹⁾ for thermal coal of $56.19.

Click here for the full press release.