|By Marketwired .||
|March 31, 2014 08:54 PM EDT||
KNOXVILLE, TENNESSEE -- (Marketwired) -- 03/31/14 -- Xinergy Ltd. (the "Company") (TSX: XRG) -
-- On March 31, 2014, the Company completed a private placement of 11.0 million common shares for total proceeds of $4.95 million. These funds will be used for general corporate purposes. -- On March 6, 2014, the Company appointed Joseph Groia to the Board of Directors. With this appointment, the Board now has five members, including three independent members. -- In January 2014, we completed construction of a $9.5 million coal preparation plant at our Raven Crest Mining, LLC ("Raven Crest") facility. The Company also resumed production from the Raven Crest surface and highwall miner operations and began shipping coal from the newly constructed preparation plant. This coal processing facility allows the Company to increase the marketability of this low cost, high quality thermal coal to thermal markets in the eastern US and Europe. -- In January 2014, the Company began shipping coal from its South Fork Coal Company, LLC ("South Fork") mid-volatility metallurgical mine on a one year 60,000 ton coal supply agreement that is expected to generate $8.7 million in revenues for 2014. Additional production currently is sold into the spot market while we continue to negotiate term contracts with end users throughout North and South America and Europe as well as international commodity brokers. -- On November 4, 2013, the Company announced the appointment of Bernie Mason as Chief Executive Officer following the resignation of Matthew Goldfarb as Chief Executive Officer and director of the Company. The Company also announced the resignation of Stephen Loukas and Jay Thornton as members of the Board of Directors. -- The fourth quarter 2013 revenues and adjusted EBITDA were $5.7 million and ($1.5) million, respectively, compared to $11.5 million and ($7.2) million for same quarter of 2012. The decreases in revenues were attributable to the reductions in tons sold from 179,584 in the fourth quarter of 2012 to 65,037 tons sold in the third quarter of 2013 due to the sale of our Kentucky thermal mining operations in the first quarter of 2013. The increase in adjusted EBITDA in the fourth quarter of 2013 was the result of increased average per ton sales realization of $87.03 in the fourth quarter of 2013 as compared to $64.30 in the same quarter of 2012. -- At December 31, 2013, we had total cash and cash equivalents of $10.5 million plus $10.0 million of restricted cash, compared with $32.3 million and $7.5 million at December 31, 2012, respectively. -- The Company continues to evaluate possible sales of non-strategic, surplus and non-core assets in addition to other transactions in efforts to strengthen our balance sheet and improve liquidity in the near term. -- The Company recognized non-cash impairment charges of $6.0 million in the fourth quarter relating to the continued idling of its True Energy, LLC ("True Energy") surface mine as we continue to rationalize our cost base to meet market demand.
Xinergy Ltd., a Central Appalachian coal producer, today announced that the Company had a net loss of $(38.6) million, or $(0.70) per diluted share for the year ended December 31, 2013 and a net loss of $(15.9) million, or $(0.29) per diluted share, for the fourth quarter of 2013. This is compared with a net loss of $(88.8) million, or $(1.63) per diluted share for the year ended December 31, 2012 and a net loss of $(40.4) million, or $(0.74) per diluted share, for the fourth quarter of 2012. Fourth quarter and full year 2013 adjusted EBITDA was $(1.5) million and $(10.8) million, respectively, compared with $(7.2) million and $(22.8) million, respectively for the fourth quarter and full year 2012. The Company's Audited Consolidated Financial Statements for the year ended December 31, 2013, together with its Management's Discussion and Analysis ("MD&A") for the corresponding period, have been posted on SEDAR at www.sedar.com and on the Company's website at www.xinergycorp.com.
"2013 was a pivotal year for Xinergy as we continue to position our company for the future. The completion of our South Fork preparation plant and loadout along with the completion of our Raven Crest preparation plant in early 2014 will allow us to better take advantage of market opportunities," said Bernie Mason, president and CEO. "The success of our company is driven by our employees. We never lose focus of the health and safety of all our employees. I am extremely proud of the fact that we had zero lost time accidents for all of 2013."
"Operationally, we continue to permit and mine develop South Fork to position this project for production increases in 2014. Our mining cost at South Fork continues to reduce as we become more efficient through our mine planning and development. Our Q4 cost per ton was $92.54 and $86.05 for the full year 2013," continued Mason.
The following tables present selected balance sheet, statement of operations and sales and operating statistics.
As of As of As of December 31 December 31 December 31 ($'000) 2013 2012 2011 --------------------------------------------------------------------------- Balance Sheet Cash and cash equivalents $ 10,485 $ 32,325 $ 72,983 Total current assets $ 20,941 $ 50,723 $ 117,269 Total assets $ 139,372 $ 188,772 $ 289,701 Total current liabilities $ 9,966 $ 20,797 $ 40,309 Total long-term liabilities $ 228,737 $ 229,786 $ 224,803 Shareholders' equity $ (99,331) $ (61,811) $ 24,589 ($'000, except per share) 2013 2012 2011 --------------------------------------------------------------------------- Statement of Operations Coal revenues $ 19,031 $ 81,159 $ 166,820 Cost of coal sales $ 22,860 $ 95,167 $ 122,092 Gross margin $ (3,829) $ (14,008) $ 44,188 (Loss) income before taxes $ (38,501) $ (70,023) $ (24,893) Net (loss) income $ (38,561) $ (88,795) $ (14,107) Basic and diluted net income (loss) per common share $ (0.70) $ (1.63) $ (0.25) Three months Three months Three months Three months ended ended ended ended ($'000, except December 31, September 30, June 30, March 31, per share) 2013 2013 2013 2013 ------------------------------------------------------------ Statement of Operations Coal revenues $ 5,661 $ 4,545 $ 4,739 $ 4,086 Cost of coal sales $ 5,849 $ 6,067 $ 5,014 $ 5,930 Gross margin $ (188) $ (1,522) $ (275) $ (1,844) (Loss) income before taxes $ (15,817) $ (11,400) $ (9,379) $ (1,905) Net (loss) income $ (15,877) $ (11,400) $ (9,379) $ (1,905) Basic and diluted net income (loss) per common share $ (0.29) $ (0.21) $ (0.17) $ (0.03) Sales & Operating Statistics 2013 2012 2011 --------------------------------------------------------------------------- Tons sold 231,853 1,211,166 1,990,447 Tons produced 219,776 983,871 2,037,002 Sales price/ton $ 82.08 $ 67.01 $ 83.54 COGS/ton sold $ 98.60 $ 78.58 $ 61.34 Gross margin/ton sold $ (16.52) $ (11.57) $ 22.20 Cash costs/ton produced $ 107.05 $ 79.77 $ 59.01 Three months Three months Three months Three months Sales & ended ended ended ended Operating December 31, September 30, June 30, March 31, Statistics 2013 2013 2013 2013 --------------------------------------------------------------------------- Tons sold 65,037 57,589 49,270 59,956 Tons produced 55,816 58,941 53,867 51,152 Sales price/ton $ 87.03 $ 78.93 $ 96.19 $ 68.16 COGS/ton sold $ 89.93 $ 105.34 $ 101.77 $ 98.90 Gross margin/ton sold $ (2.90) $ (26.41) $ (5.58) $ (30.74) Cash costs/ton produced $ 110.58 $ 98.26 $ 112.03 $ 108.07
The following table presents selected coal production and sales data from our metallurgical and thermal coal mines for the twelve months ended December 31, 2013.
Twelve months ended December 31, 2013 --------------------------------------------- Met Thermal Total --------------------------------------------- Tons sold 182,727 49,126 231,853 Tons produced 191,287 28,489 219,776 Sale price/ton $ 91.67 $ 46.43 $ 82.08 COGS/ton sold $ 92.14 $ 122.60 $ 98.60 Gross margin/ton sold $ (0.47) $ (76.17) $ (16.52) Total Revenues $ 16,750,425 $ 2,280,938 $ 19,031,363 Total Cost of Sales $ 16,836,590 $ 6,023,066 $ 22,859,656 Total Gross Margin $ (86,165) $ (3,742,128) $ (3,828,293) Cost of Coal Sales $ 16,836,590 $ 6,023,066 $ 22,859,656 Inventory Change $ 300,026 $ 367,130 $ 667,156 Purchase Coal $ - $ (637) $ (637) Cash cost $ 17,136,616 $ 6,389,559 $ 23,526,175 Tons Produced 191,287 28,489 219,776 Cash costs/ton produced $ 89.59 $ 224.28 $ 107.05
The following table presents selected coal production and sales data from our metallurgical and thermal coal mines for the three months ended December 31, 2013.
Three months ended December 31, 2013 --------------------------------------------- Met Thermal Total --------------------------------------------- Tons sold 65,037 - 65,037 Tons produced 55,816 - 55,816 Sale price/ton $ 87.04 $ - $ 87.03 COGS/ton sold $ 90.06 $ - $ 89.93 Gross margin/ton sold $ (3.02) $ - $ (2.90) Total Revenues $ 5,660,782 $ (575) $ 5,660,207 Total Cost of Sales $ 5,857,239 $ (8,261) $ 5,848,978 Total Gross Margin $ (196,457) $ 7,686 $ (188,771) Cost of Coal Sales $ 5,857,239 $ (8,261) $ 5,848,978 Inventory Change $ (521,324) $ 844,564 $ 323,240 Cash cost $ 5,335,915 $ 836,303 $ 6,172,218 Tons Produced 55,816 - 55,816 Cash costs/ton produced $ 95.60 $ - $ 110.58
Capital expenditures were $7.1 million during the fourth quarter, reflecting substantial completion of our Raven Crest preparation plant. Capital expenditures for the year ended December 31, 2013 were $39.3 million.
Liquidity and Capital Resources
At December 31, 2013, as outlined in the following table, we had total cash and cash equivalents of $10.5 million and $10.0 million of restricted cash, compared with $32.3 million and $7.5 million at December 31, 2012, respectively.
December 31, December 31, ($'000) 2013 2012 --------------------------------------------------------------------------- Cash, operating $ 10,485 $ 32,325 Cash, restricted: Kentucky sale proceeds $ 518 $ - Kentucky sale proceeds held in escrow $ 3,001 $ - Deposits $ 1,440 $ 1,029 Reclamation bond collateral $ 5,009 $ 6,466 ------------------------------ $ 9,968 $ 7,495 ------------------------------
In accordance with the 2019 Notes, the restricted cash received from the Kentucky sales proceeds was used to make capital expenditures. At December 31, 2013, we have $0.5 million of these sale proceeds available in addition to $3.0 million that is being held in escrow and will be available in June 2014. We have made $39.0 million of capital expenditures in 2013 with approximately $37.3 million being paid out of funds generated from the Kentucky sale.
The Company currently has negative cash flow from operations but is expected to generate positive cash flow as production and sales revenues increase from the 2013 levels at our South Fork metallurgical mine and Raven Crest thermal mine. The recently re-opened Raven Crest surface operations are expected to generate positive cash flow while maintaining a low operating cost structure. Recent recovery of Central Appalachian thermal coal demand and pricing have allowed us to obtain sales in volumes and pricing that are expected to provide positive margins for Raven Crest in 2014. South Fork continues to experience cash costs that are consistent with our forecasts. However, with recent downturns in worldwide demand for metallurgical coal, our tons sold and sales price realization have been significantly below expectations resulting in decreased margins that have not been as anticipated. We have been selling our South Fork coal into the spot markets and have shipped to several end users test burns since our preparation plant and CSX rail load out became operational in July 2013. As of this date, South Fork has received a one year sales commitment for 60,000 tons per year totaling $8.7 million in 2014. We are in negotiations to extend this contract through 2015. All other South Fork sales continue to be from short term spot market sales. We are continuing to negotiate with US and European end users as well as US and international commodity brokers to sell our South Fork production under long term contracts.
The positive cash flows from Raven Crest together with the lower margins being generated from South Fork at current production levels are not expected to be sufficient to cover corporate overhead, debt service and other non-operating costs in 2014. Without a combination of higher production, higher price per ton sales for our South Fork production and/or the sales of non-strategic assets, we will have to seek additional sources of capital to service our existing debt, cover our non-operating costs and mitigate working capital fluctuations.
The Company has also been reducing inventory levels and expects to have the excess Raven Crest inventory shipped by May 2014. The sale of this inventory will result in cash generation of approximately $5.0 million.
The Company remains highly leveraged. Our 2019 Notes have an outstanding balance of $195.0 million and provide for semi-annual interest payments of $9.0 million in mid-November and mid-May. Our senior notes have an outstanding balance of $20.0 million and provide for quarterly interest payments of $0.5 million.
On March 31, 2014, we received $4.95 million from the sale of common shares pursuant to a private placement. We continue to hold discussions with current and potential new investors and financial advisors in efforts to arrange financing that will provide adequate liquidity that when combined with existing cash balances, will be sufficient to make the $9.0 million interest payment on our 2019 Notes in November 2014. We also continue to explore strategic alternatives that may include an additional sale of equity securities, the sale of debt securities, the sale of surplus mining equipment, owned reserves and other assets and/or the restructuring of our debt. The successful funding could be dependent on approval of shareholders and there is a risk that contemplated financing activities might not materialize.
During 2013, the Company reported a loss of approximately $38,561,000. As of December 31, 2013, the Company has an accumulated deficit of approximately $162,455,000. The Company has not generated positive cash flow from operations in 2013 or 2012. Whether and when the Company can attain profitability and positive cash flows is uncertain.
This indicates the existence of a material uncertainty that raises substantial doubt about the Company's ability to continue as a going concern and the Company's ability to continue is dependent on the Company raising additional debt or equity financing. During March 2014, the Company raised $4.95 million through the issuance of 11 shares of common stock in a private placement. The Company is also discussing equity and debt financing opportunities with a number of individuals and lending institutions. The Company believes that such discussions will result in the Company obtaining financing and capital required to fund the Company's operations. However there is no assurance that such financing will be obtained or obtained on commercially favorable terms. These consolidated financial statements do not give effect to any adjustment which would be necessary should the Company be unable to continue as a going concern and therefore, be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the consolidated financial statements.
Conference Call, Webcast and Replay
The Company will hold its quarterly conference call to discuss fourth quarter 2013 operating results on Tuesday April 1, 2014 at 10:00 a.m. EDT. The conference call will be open to the public toll free at (877) 317-6789. International callers should use (412) 317-6789, and Canadian callers should use (866) 605-3852. The conference call can also be accessed via webcast on the Company's website with a replay available shortly after the event.
About Xinergy Ltd.
Headquartered in Knoxville, Tennessee, Xinergy Ltd., through its wholly owned subsidiary Xinergy Corp. and its subsidiaries, is engaged in coal mining in West Virginia and Virginia. Xinergy sells high quality metallurgical and thermal coal to electric utilities, steelmakers, energy trading firms and industrial companies. For more information, please visit www.xinergycorp.com.
This news release contains forward-looking information is based on the Company's expectations and beliefs concerning future events and involves risks and uncertainties that are outside of our control and may cause actual results to materially differ from current expectations. Some of these key assumptions include, among other things: no material disruption in production, or no material variation in anticipated thermal and metallurgical coal sales volumes; no material decline in markets and pricing of steam or metallurgical coal other than anticipated variations; continued availability of and no material disruption in rail service; no production, construction or shipping disruptions due to adverse weather conditions other than normal, seasonal patterns; no material delays in the current timing for completion of ongoing projects; no material delays in the receipt of anticipated mining permits from governmental agencies; financing will be available on terms favorable and reasonable to the Company; no material variation in historical coal purchasing practices of customers; coal sales contracts will be entered into with new customers; parties execute and deliver contracts currently under negotiation; and no material variations in the current regulatory environment. The reader is cautioned that such assumptions, although considered reasonable by us at the time of preparation, may prove to be incorrect.
Actual results achieved during the forecast period may vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. Additional factors include, but are not limited to the factors on page 6: changes in general economic, market and business conditions; uncertainties associated with estimating the quantity and quality of coal reserves and resources; commodity prices; currency exchange rates; the availability of credit facilities for capital expenditure requirements; debt service requirements; dependence on a single rail system; changes to federal and state legislation; liabilities inherent in coal mine development and production; competition for, among other things, capital, acquisitions of reserves, undeveloped lands and skilled personnel; geological, mining and processing technical problems; ability to obtain required mine licenses, mine permits and regulatory approvals required to proceed with mining and coal processing operations; ability to comply with current and future environmental and other laws; actions by governmental or regulatory authorities including increasing taxes and changes in other regulations; the occurrence of unexpected events involved in coal mine development and production; and other factors, many of which are beyond our control. Many of these risk factors and uncertainties are discussed in our Annual Information Form ("AIF") in a section entitled "Risk Factors" and other documents filed with the Canadian securities regulatory authorities available on SEDAR at www.sedar.com. Please refer to these documents for further details about the risks faced by the Company.
This news release reports certain financial measures that are not recognized by Canadian generally accepted accounting principles "GAAP" to evaluate the performance of the Company. Since certain non-GAAP financial measures may not have a standardized meaning and may not be comparable to similar measures presented by other companies, Canadian securities regulations require that non-GAAP financial measures are clearly defined, quantified and reconciled with their nearest GAAP measure. Investors and other readers of this news release are cautioned that these non-GAAP financial measures should not be construed as alternatives to other measures of financial performance calculated in accordance with GAAP. Please refer to page (2), page (11), and page (24) to page (25) of the Company's MD&A which is available on SEDAR at www.sedar.com for further details with respect to the use of non-GAAP measures and for the applicable reconciliations.
G. L. "Bernie" Mason
Chief Executive Officer
Michael R. Castle
Chief Financial Officer
Robert L. Gaylor
Senior Vice President
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
Apr. 28, 2017 12:15 AM EDT Reads: 1,340
Building a cross-cloud operational model can be a daunting task. Per-cloud silos are not the answer, but neither is a fully generic abstraction plane that strips out capabilities unique to a particular provider. In his session at 20th Cloud Expo, Chris Wolf, VP & Chief Technology Officer, Global Field & Industry at VMware, will discuss how successful organizations approach cloud operations and management, with insights into where operations should be centralized and when it’s best to decentraliz...
Apr. 28, 2017 12:15 AM EDT Reads: 802
“DevOps is really about the business. The business is under pressure today, competitively in the marketplace to respond to the expectations of the customer. The business is driving IT and the problem is that IT isn't responding fast enough," explained Mark Levy, Senior Product Marketing Manager at Serena Software, in this SYS-CON.tv interview at DevOps Summit, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Apr. 28, 2017 12:00 AM EDT Reads: 16,316
@DevOpsSummit at Cloud taking place June 6-8, 2017, at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long developm...
Apr. 27, 2017 11:30 PM EDT Reads: 2,299
Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market across the USA and Europe, we work with a variety of customers from emerging startups to Fortune 1000 companies.
Apr. 27, 2017 10:45 PM EDT Reads: 2,427
@GonzalezCarmen has been ranked the Number One Influencer and @ThingsExpo has been named the Number One Brand in the “M2M 2016: Top 100 Influencers and Brands” by Analytic. Onalytica analyzed tweets over the last 6 months mentioning the keywords M2M OR “Machine to Machine.” They then identified the top 100 most influential brands and individuals leading the discussion on Twitter.
Apr. 27, 2017 10:30 PM EDT Reads: 1,282
Financial Technology has become a topic of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 20th Cloud Expo at the Javits Center in New York, June 6-8, 2017, will find fresh new content in a new track called FinTech.
Apr. 27, 2017 10:30 PM EDT Reads: 2,447
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
Apr. 27, 2017 10:15 PM EDT Reads: 1,464
Cloud Expo, Inc. has announced today that Aruna Ravichandran, vice president of DevOps Product and Solutions Marketing at CA Technologies, has been named co-conference chair of DevOps at Cloud Expo 2017. The @DevOpsSummit at Cloud Expo New York will take place on June 6-8, 2017, at the Javits Center in New York City, New York, and @DevOpsSummit at Cloud Expo Silicon Valley will take place Oct. 31-Nov. 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Apr. 27, 2017 10:15 PM EDT Reads: 2,648
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
Apr. 27, 2017 10:15 PM EDT Reads: 9,231
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
Apr. 27, 2017 10:00 PM EDT Reads: 2,050
With billions of sensors deployed worldwide, the amount of machine-generated data will soon exceed what our networks can handle. But consumers and businesses will expect seamless experiences and real-time responsiveness. What does this mean for IoT devices and the infrastructure that supports them? More of the data will need to be handled at - or closer to - the devices themselves.
Apr. 27, 2017 09:45 PM EDT Reads: 889
Translating agile methodology into real-world best practices within the modern software factory has driven widespread DevOps adoption, yet much work remains to expand workflows and tooling across the enterprise. As models evolve from pockets of experimentation into wholescale organizational reinvention, practitioners find themselves challenged to incorporate the culture and architecture necessary to support DevOps at scale. In his session at @DevOpsSummit at 20th Cloud Expo, Anand Akela, Senior...
Apr. 27, 2017 09:30 PM EDT Reads: 1,891
Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more business becomes digital the more stakeholders are interested in this data including how it relates to business. Some of these people have never used a monitoring tool before. They have a question on their mind like “How is my application doing” but no id...
Apr. 27, 2017 09:15 PM EDT Reads: 7,295
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
Apr. 27, 2017 09:15 PM EDT Reads: 1,274