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Keaton announces five-fold increase in profits

Johannesburg, South Africa — 30 May 2012 – Keaton Energy Holdings Limited has announced a more than five-fold increase in profits for the year ended 31 March 2012, attaining a level of R149 million.

In a results statement released here. the company revealed that headline earnings per share (HEPS) had jumped 145% to 25.2 South African cents, and earnings per share (EPS) by 783% to 90.9 cents per share. Net asset value (NAV) per share rose by 31% to R4.45.

These improvements reflect substantial production and sales increases, from 56 000t to 1.2Mt, flowing from continued production build-up at Keaton Energy’s new Vanggatfontein colliery, and extensive turnaround activities at its recently-acquired Vaalkrantz Colliery.

The results statement added that at Vanggatfonfontein, the total run of mine (ROM) production had increased to 2.1Mt from some 137,000t, reflecting the on-going production build-up during the year. Total saleable product had risen to 1.1Mt from around 57 000t. Keaton Energy managing director Paul Miller said work continued apace to increase saleable production of 4 and 2 Seam coal from the 145,000tpm attained in the period under review to the planned

Production of 5 Seam metallurgical coal from Vanggatfontein for the domestic market had increased by 146% to 140,000t. Miller said that, while the quality of 5 Seam product was consistently good, geological conditions in Pit 1 had been more variable than anticipated, resulting in lower-than-planned levels of 5 Seam production. Optimisation of Vanggatfontein’s mine plan was well in hand and would involve development of the colliery’s third open pit during calendar 2012. Pit 3 was expected to produce a steady supply of 5 Seam and higher- yielding 4 and 2 Seam coal.

The statement said that at Vaalkrantz, where Keaton Energy had taken effective control from mid-December 2011, total ROM production had almost doubled to 560,000t with total saleable production up by 94% to 351,000t for the full 12 months. Total anthracite sales had risen by 76% to 376,000t, of which 169 000t were exported “’ an increase of 83%, and 207,000t were sold into the domestic market “’ an increase of 70%.

Miller went on to say that the group had now comfortably exceeded its mid-term production target of 2Mtpa, having established a production platform of 2.7Mtpa across its two operations.

“Our strategy now is to attain 5Mtpa mid-tier producer status. We have a track-record of success in terms of greenfields exploration and development on which to advance our future projects and prospects, and we have also demonstrated our ability to identify distressed assets and turn these to account. Stakeholders can expect Keaton Energy to vigorously pursue both avenues of growth in the years ahead,” Miller concluded.

Source: Keaton Energy Holdings Limited. For more information, click here.