Energybuild Share Discussion Threads

[jonwig] 03/12/2008 12:45

ATH FY results are optimistic, though the share price hasn't responded well:

[lefrene] 03/12/2008 12:19

When Thatcher took on the miners it was quite a deliberate ploy knowing that 500 years worth of coal would be there once the oil was used up. Now the oil has been squandered we need to reduce imports as quickly as possible, hence Westminster will be very keen to see mines reopened. All we need now are some cheap chinese power plants.

[jonwig] 02/12/2008 12:38

A summary of the background of the Panorama programme for those (like me) who don't watch TV:

[sammu] 01/12/2008 18:46

Panorama on tonight at 8.30 about opencast coal in UK, could be of interest and worth i-player if reading this later.

[lasata] 25/11/2008 19:55

Daniel Rice--manager of BlackRock Advisors Inc.'s Global Resources Fund, which is also among the largest holders of Peabody and Arch-told Bloomberg Monday, "Coal is the best commodity to get into right now. It's a lot less sensitive to downturns because it is needed for basic power generation, and demand is growing."

[jonwig] 19/11/2008 19:08

EBG isn't supplying Corus.
Wrong grades, I believe.
They provided some 'pulverised injection coal' in the old Coal Board days, and could do that again, I think.

This is an interesting read - dated Jan 2007, but I hadn't seen it before:

[lefrene] 19/11/2008 18:47

I wouldn't know azalea, I only happened to be talking to a couple of drivers on a quayside who had carried the steel. They remarked that it was very unusual to see steel going to Mexico, and said there seemed to be a lot more lined up for the same destination. They were only too glad to have a run of work, but were clued up enough to guess that the £ being weak against the $ was the reason. I'm only guessing (and could be very wide off the mark,)that it might be for US owned businesses, as to me that would make the most sense given the struggle with high fixed costs inside the USA, and agreements which allow for manufacture just inside Mexico.

[azalea] 19/11/2008 18:03

lefrene
Would not NAFTA rules have something to say about that?

[lefrene] 19/11/2008 14:12

I hear that the low pound is creating strong demand for high quality steel from South Wales mills bound for Mexico. Perhaps american businesses based just inside Mexico? Has to be good for coking coal demand in S Wales.

[lasata] 19/11/2008 09:09

If the anticipated selling price in business plan was £38 pt then they should be happy with today's prices which must be well above that.

Lower cost of diesel for their opencast operations should be beneficial too.

[jonwig] 19/11/2008 08:52

Lasata, from the FY results to 30/06:

The market for coal, and in particular quality anthracite coal, has had a remarkable year with world prices increasing month on month from January 2008 to the end of June 2008. Our business plan anticipated a selling price of £38 per tonne, for coal into the Aberthaw Power Station and the prices currently being achieved have exceeded all expectations. Similar increases have been witnessed in coal being sold into the sized market.

It's a pity the IMS didn't comment on the current sales prices being achieved, as that is the main factor affecting the SP, I'm sure.

[lasata] 19/11/2008 08:06

Jonwig: Correct all costs during mine development are being charged in that £79 figure and that is the honest approach.

Fall of sterling should protect their markets from "import" competition.

Your £38 figure - was that cost rather than sale price?

[jonwig] 19/11/2008 07:28

They did say that costs at the drift mine will reduce, so we can expect the £79 to be lower in the next accounts. "Development coal" is just that - coal produced during the development (= high cost) phase.

I seem to remember that they said their business model assumed sale prices of (?) £38 per tonne to Aberthaw. If so, we can expect their costs to be substantially lower going forward.

The market is obviously spooked by the sharp falls in global coal prices, which are still higher though than when EBG floated.

[septimus quaid] 19/11/2008 03:16

Yes Slap, the statement "with an average cash cost of £79 for this development coal" struck me as curious. Is the £79 an ongoing cost/rate, even after the development work has been completed?

Regards

SQ

[slapdash] 19/11/2008 02:59

Interesting statement. So the underground mine is barely profitable (costs of £79 versus sale price of £85. But this is where future production growth is coming from. The open cast is very profitable but isn't growing in output.

So slightly cautious I guess then... also if they say coal prices aren't affected by the slowdown how can they be taken seriously... Slap

[roks] 18/11/2008 16:22

When broker say "buy" does it really mean buy or sell?

[lasata] 17/11/2008 08:09

Energybuild Group Plc (50.6 %)

Energybuild Group has continued to progress during the first quarter of the financial
year.

Energybuild received final planning permission for the new drift at its Aberpergwm
underground mine in July 2008 which, once completed,
will allow for a number of improvements in efficiency including enhanced ventilation, coal
clearance and material handling.

Development has continued underground at the 18ft seam with a significant proportion of
the roadways required for an air circuit now
completed in preparation for commencing the drives to block out the production areas.
Production for the quarter from development roads in
the 18ft seam was 35,000 tonnes of saleable coal and remains on track to increase
significantly in the 3rd and 4th quarters in line with
Energybuild's target of 265,000 tonnes for the 2009 financial year. Energybuild has achieved
an average sales price of £85 for 33,000
tonnes of coal sold with an average cash cost of £79 for this development coal. This cash
cost of production is expected to reduce in the
3rd and 4th quarters as production is increased and capital investment applied. The balance of
the production was held in inventory.

The Nant y Mynydd opencast operations have performed in line with expectations and have
produced 34,000 tonnes of saleable coal for the
quarter at a cash cost of £37 and a sales price of £70 per tonne.

Energybuild's joint venture with Coal Recovery Investments ltd. to recover coal from
disused coal tips in the south Wales valley is now
moving forward following the receipt of full planning permission in September 2008.
Energybuild estimates that the recovery scheme will
yield in excess of 200,000 tonnes of coal over an eighteen month period, and they expect the
project to contribute towards their overall
performance in the 2009 financial year.

The market for Energybuild's products remains buoyant despite the current economic
uncertainties. Energybuild continues to supply
Aberthaw power station with 5,000 tonnes of coal per week and provides its high quality
anthracite to a broad base of industrial clients
both domestically and in Europe. With the recent signing of the extension to utilise the Tower
Colliery railhead for a further two years,
Energybuild has secured cost effective access to these and other potential markets, providing
further flexibility to Energybuild and its
future plans.

Cambrian owns 65,760,000 shares in Energybuild (50.6%)

Energybuild Group Plc
Quarterly production
Marketable Coal (tonnes) June 30, 2008 September 30, 2008
Opencast coal produced 32,000 34,000
Underground coal produced 19,000 35,000
Total thermal and sizes coal sold 37,000 77,500

[jonwig] 17/11/2008 07:07

Quarterly update shows production on track, and profitable, given the numbers provided:



But prices achieved might have softened since end-Sept, of course.

[lasata] 13/11/2008 11:35

From FENR results: "Fenner ..... was still poised to benefit from robust demand for thermal coal in world markets".

EBG should benefit also!

[jonwig] 13/11/2008 10:08

That's good news on costs ... but profits?

CBM's results repeated what we know already about EBG, but had nothing to say on future strategy which might impact EBG.

[lasata] 13/11/2008 09:36

Good news:

Rail head agreement




RNS Number : 0843I
Energybuild Group PLC
13 November 2008


Energybuild Group Plc / Index: AIM / Ticker: EBG / Sector: Mining
13 November 2008
Energybuild Group Plc ('Energybuild' or 'the Company')
Rail head agreement with Tower Colliery

Energybuild Group Plc, the AIM listed Welsh anthracite producer, has signed a further two
year contract with the owners of Tower
Colliery ('Tower') allowing Energybuild continued use of Tower's rail head facility. This
agreement enables the Company to facilitate its
ongoing supply contract with the Aberthaw Power Station while increasing its potential to
reach other markets.

Energybuild Managing Director Rhidian Davies said, "This agreement is hugely beneficial
for Energybuild and secures our ability to sell
coal into our existing markets, while exploring the potential to extend our market reach in
terms of further sales. In addition, this
allows the Company to utilise Tower's existing washery, which was purchased as part of the
equipment from Tower for a total of £1.4 million
earlier this year. With increased production rates expected next year, the Board believes
that this agreement provides the Company with far
more sales flexibility moving forward."

[osirisra] 12/11/2008 19:59

A lot of talk on here about shipping costs having collapsed and making imports more attractive. Also the declining price of coal.
Surely with the value of the pound in serious decline imports will be dearer.
This should help to balance some of the concerns I guess?

[kooba] 10/11/2008 10:05

A REVOLUTIONARY initiative that could signal a big comeback for the Welsh coal industry has been welcomed by the UK Government.

[lefrene] 06/11/2008 20:01

Iasata, one only has to look at the Baltic Dry Index to see that shipping rates have crashed by 95% in 8 months, only today Genco preferred to lose $53 million on cancelled ship orders than to proceed with the contract. I'm amazed that governments are not getting to grips with the letters of credit situation and demanding that Banks immediately start normal trade in return for the huge bailouts. Failing that, then governments should directly guarantee payments against bills of lading, until normal trade returns. No doubt when absolute essentials start to dry up, then perhaps a government department or two will wake up. Perhaps that nice Mr Brown having come to the rescue of the Banks, will seek another stage-managed round of applause as he decrees letter of credit to be issued forthwith.