Lubelski Węgiel Bogdanka - news en 2017-12-11 04:52:02 LW Bogdanka after three quarters of 2017 – improved financial results with similar level of mining and sales In the third quarter of 2017 the Lubelski Węgiel Bogdanka Group generated revenue of PLN 405 million, and net profit of PLN 31.5 million. EBIT in Q3 2017 amounted to PLN 44.4 million, while EBITDA totalled PLN 133.9 million.  

Cumulative after three quarters of 2017, revenue amounted to PLN 1.3 billion (down by 0.6% y/y) and net profit amounted to PLN 143.7 million (up by 19.6% y/y). In the analysed period, EBIT was PLN 191.9 million (up by 24.1% y/y), while EBITDA totalled PLN 452.5 million (up by 4.7% y/y).


The Company believes the achieved financial results are good. The Company continues to distinguish itself in the industry thanks to a permanent cost control and optimisation of capital expenditure.

Bogdanka retains a strong market position. After three quarters of 2017, the Company’s share in the market of thermal coal sales accounted for 17.7%, and its share in the market of thermal coal sales to commercial power plants accounted for 25.5%.

In Q3 2017, commercial coal production was performed as per the plan and reached a level of 2.2 million tonnes. Sales in this period of more than 2 million were also in line with the plan. As a consequence, after the three quarters of 2017, both production and sales of commercial coal amounted to about 6.7 million tonnes (and were comparable to those generated in the same period a year earlier). The length of gallery workings completed in the first nine months of 2017 totalled 22.5 km, which means a 22.3% increase compared to the same period of 2016.

The target value for annual production of approx. 9 million tonnes remains unchanged.

After three quarters 2017, LW Bogdanka retained the high level of output (65.8% compared to 62.2% a year before in the same period) despite a decrease in output in Q3 2017 resulting from difficult mining and geological conditions.

 

The financial results achieved after three quarters of this year are in my opinion good – attention should be paid to the increased profitability with a concurrent similar level of mining and sales and practically flat level of realised prices. Our constant efforts on cost efficiency are clearly visible, and our production target for this year – i.e. 9 million tonnes – remains unchanged, said Krzysztof Szlaga – President of the Management Board of LW Bogdanka S.A.

Highlights of the third quarter include the application for a hard coal mining licence filed by Bogdanka with respect to the Ostrów deposit in the Ludwin mining Area, which was followed by obtaining the same by the Company in November this year. In October 2017 the Company signed an Annex to the Long-Term Agreement for the sale of thermal coal with the Zakłady Azotowe Puławy Group, thus increasing the quantitative volumes of supplies and rising the price. Also in October, the Company signed an agreement with respect to coal allowances paid to retirees and pensioners. As a result of the agreement, the balance of provisions at the Company will change, leading to a one-off positive impact on its operating profit in the fourth quarter of 2017 in the amount of approx. PLN 110 million.
 

In the third quarter, in pursuance of our Strategy, we filed an application for a mining licence for the Ostrów deposit and in November we obtained it. An almost two-fold increase in the resource base means that, as a result of obtaining the licence, we are able to plan in the long term and secure the mine’s development. In October this year we signed an agreement with the trade unions with respect to coal allowances, which means that Bogdanka has resolved the issue of coal allowances for both present and future retirees and pensioners, added Krzysztof Szlaga.


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czytaj-aktualnosc/2656/lw-bogdanka-after-three-quarters-of-2017-improved-financial-results-with-similar-level-of-mining-and-sales/ 2017-11-23 00:00:00 2656
LW Bogdanka has obtained a licence for mining in the Ostrów deposit LW BOGDANKA S.A., the most modern and effective hard coal mine in Poland, a member of the Enea Group, one of the leaders in Poland’s power market, has obtained from the Minister of the Environment a mining licence for extraction of hard coal from the Ostrów deposit in the Ludwin Mining Area, with the exploitable resources of about 186 million tonnes.   

Obtaining the licence is key for the pursuance of the Company’s plan to double its exploitable resources, as announced in the “Development Strategy of LW Bogdanka S.A. Mining Area of the Enea Group until 2025”. In addition, the Company wants to expand the resources of the Bogdanka field by further ca. 33 million tonnes. In total, Bogdanka will be able to increase its resources from the current approx. 227 million tonnes to approx. 446 million tonnes and extend the mine’s life span to ca. 50 years (from about 25 years at present).  

The mining in the Ostrów deposit will be effected in two stages. The first stage assumes mining based on the existing underground infrastructure. Launching the first wall is scheduled for 2020. In the second turn, between 2025 and 2030 vertical deposits are planned to be made available for mining and the necessary facilities and technical infrastructure will be built. Preliminary estimates show that the total capital expenditures required to build such infrastructure will amount to PLN 1.2 - 1.3 billion (in real terms). The target mining levels are to be reached in the Ostrów deposit around 2030.
Further, the Company is continuing to analyse the K-6, K-7 and “Orzechów” deposits as prospective areas for future mining operations. 

 

“Obtaining the mining licence for the Ostrów deposit is a very important step in performing the plan to double the Company’s exploitable resources, as we have announced in our Strategy. Increasing the resources base means that now we are able to plan in the long term, secure the mine’s development, and in consequence - ensure stability of employment for further generations of miners. This will also serve for retaining Bogdanka’s position of one of the most important companies in the region, contributing to the development of the Lublin region. Increasing the base of resources will also translate into ensuring a stable raw materials base for the Enea Group, of which we make part”saidKrzysztof Szlaga, President of the Management Board of LW Bogdanka S.A.


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czytaj-aktualnosc/2654/lw-bogdanka-has-obtained-a-licence-for-mining-in-the-ostrow-deposit/ 2017-11-20 00:00:00 2654
LW Bogdanka S.A. signs agreement with trade unions on coal allowances for retirees and pensioners Lubelski Węgiel Bogdanka S.A. signed today with the trade unions active at the Company an agreement to amend the Company Collective Bargaining Agreement to the extent it is related to payments of coal allowances to the Company’s retirees and pensioners.

The agreement is connected with the Act on the benefit to compensate for the loss of the right to free coal, passed by the Sejm (the lower house of the Parliament) on 12 October 2017. The agreement gives the right to receive a compensation of PLN 10,000 net also to Bogdanka's retirees and pensioners.

As a result of the agreement, the balance of provisions at the Company will change, leading to a one-off positive impact on its operating profit in the fourth quarter of 2017 in the amount of approx. PLN 110 million. An ultimate change in the balance of provisions, as referred to above, will be estimated by the actuary and presented in the Company’s periodic report for 2017.  

 

“The agreement we have signed today with the trade unions means that Bogdanka has resolved the issue of coal allowances for both present and future retirees and pensioners. In the near future, after the Act finally becomes law, we will be informing the interested persons how to apply for the compensation resulting from the implemented Act. For the Company’s financials, this means a possible change in its provisions, leading to a one-off positive impact on its operating profit in the fourth quarter of this year,” said Krzysztof Szlaga, President of the Management Board of LW Bogdanka S.A.


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czytaj-aktualnosc/2652/lw-bogdanka-s-a-signs-agreement-with-trade-unions-on-coal-allowances-for-retirees-and-pensioners/ 2017-10-18 00:00:00 2652
Tender for the selection of auditing company to audit and review the financial statements The Supervisory Board of Lubelski Węgiel Bogdanka S.A. has granted an authorisation to Enea Centrum Sp. z o.o. to conduct a tender procedure for the selection of an auditing company for Lubelski Węgiel Bogdanka S.A. and its subsidiaries. Enea Centrum acts on its own behalf and as an authorised representative of other Enea Group companies, and the tender aims at selecting a company which will carry out an audit and a review of the financial statements of the Group companies, to be drawn in 2018–2020.

etails of the tender announced on 19 September 2017 are available below (only Polish version):
http://www.lw.com.pl/pl,1,przetargi,s53,d3455,wybor_firmy_audytorskiej_dla_lwb_sa_do_badania_i_przegladu_sprawozdan_finansowych.html


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czytaj-aktualnosc/2650/tender-for-the-selection-of-auditing-company-to-audit-and-review-the-financial-statements/ 2017-09-20 00:00:00 2650
Very good financial and operating results after the first half of 2017 In H1 2017 the Lubelski Węgiel Bogdanka Group generated revenue in the amount of PLN 902.1 million (up by 6.3% y/y) and net profit of PLN 112.1 million (up by 49.6% y/y). In the period in question, EBIT amounted to PLN 147.5 million (up by 52.7% y/y), while EBITDA totalled PLN 318.6 million (up by 14.9% y/y).

LW Bogdanka continues to distinguish itself in the industry with its very good results thanks to a permanent cost control and optimisation of capital expenditure. The Company’s EBITDA in H1 2017 reached 35.3%, which means it is one of the highest in the coal sector.

Bogdanka’s market position is stronger than before. After H1 2017, the Company’s share in the market of thermal coal sales accounted for 18.0%, and its share in the market of thermal coal sales to commercial power plants accounted for 26.2%.

Production in Q2 2017 was performed as per the plan totalling 2.1 million tonnes (up by  9.5% y/y). Sales in the same period was slightly higher than production covering 2.3 million tonnes (up by  3.6% y/y). In the whole first half of this year coal extraction reached the level of 4.6 million tonnes (up by 6.4%). Sales in this period remained at a similar level – i.e. of 4.7 million tonnes, which means that it increased by 6.5% y/y. The length of gallery workings completed in the first half of 2017 totalled 15 km, which represents a growth by 16.3% compared to the same period of 2016.

Owing to a change in the walls mix and better output quality (higher extraction from the cutting machine walls), LW Bogdanka has been recording a growing yield level since Q2 2016; in Q2 2017 it was approx. 68.3% compared to 61.2% w Q2 2016.

Financial and operating results of LW Bogdanka achieved after the first half of this year are, to my opinion, very good. The implementation of production and sales plans as well as consistent cost control and optimisation of capital expenditure made it possible to obtain such results. We continue to declare that our target for this year is to extract and sell approximately 9 million tonnes of coal. We maintain our strong market position with a high market share, and remain the most effective and the most modern hard coal mine in Poland,” said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka.

Financial and operating results of LW Bogdanka achieved after the first half of this year are, to my opinion, very good. The implementation of production and sales plans as well as consistent cost control and optimisation of capital expenditure made it possible to obtain such results. We continue to declare that our target for this year is to extract and sell approximately 9 million tonnes of coal. We maintain our strong market position with a high market share, and remain the most effective and the most modern hard coal mine in Poland,” said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka.

Key events of the last six months include announcing, in February this year, the Development Strategy of LW Bogdanka S.A. Mining Area of the Enea Group until 2025 (under the 2030 framework) Further, in June 2017 the Annual General Shareholders Meeting of LW Bogdanka S.A. decided to pay dividend of PLN 1 per share. The dividend totalling PLN 34 million was paid on 2 August 2017.

In order to secure a long-term development of the Company, in July we filed an application for a mining licence for the “Ostrów” deposit with the exploitable resources of about 186 million tonnes. It is an important step towards doubling our exploitable resources and extend the mine’s life to about 50 years from the current 25 years. We do hope we will have obtained the licence by the end of 2017,” added Krzysztof Szlaga.


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czytaj-aktualnosc/2648/very-good-financial-and-operating-results-after-the-first-half-of-2017/ 2017-09-08 00:00:00 2648
LW Bogdanka publishes Integrated Report for 2016 We are happy to present to you the latest Integrated Report of the LW Bogdanka Group for 2016. As in previous years, the report was prepared on the basis of the guidelines of the GRI (Global Reporting Initiative) international standard, G4, with the use of the International Integrated Reporting Framework and it includes integrated financial results as well as non-financial information of the whole LW Bogdanka Group for the calendar year 2016, i.e. the period from 1 January to 31 December 2016, and presents material events which took place after the balance-sheet date, but before the publication of this report.

The Integrated Report of the LW BOGDANKA Group is a document outlining the most important measures undertaken by the Group in the last year, fundamental principles which drive our activities in pursuance of business goals as well as the achieved results – both financial ones and the results related to the sustainable growth. We present them in relation to the applicable “Corporate Social Responsibility Strategy for 2014–2017”.

You may download our Integrated Report for 2016 here.


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czytaj-aktualnosc/2646/lw-bogdanka-publishes-integrated-report-for-2016/ 2017-07-25 00:00:00 2646
Bogdanka applies for licence for coal extraction from “Ostrów” deposit LW BOGDANKA S.A., the most modern and effective hard coal mine in Poland, a member of the Enea Group, one of the leaders in Poland’s power market, has filed with the Minister of the Environment an application for a mining licence for extraction of hard coal from the “Ostrów” deposit in the “Ludwin” mining area.

To ensure new exploitable resources and to double the total exploitable resources within the framework of the current strategic perspective until 2025 are among Bogdanka’s top priorities. After obtaining access to the “Ostrów” deposit, the Company’s resources will increase by approx. 186 million tonnes. In addition, the Company wants to expand the resources of the “Bogdanka” field by about 33 million tonnes. In total, the Company will increase its resources from approx. 227 million tonnes at present to about 446 million tonnes. Assuming the annual production at the level of approx. 9 million tonnes,  the mine will be able to continue its operations for about 50 years (as compared to the expected life span of about 25 years at present), i.e. by 2067.  

LW Bogdanka expects that it will receive the mining licence for the “Ostrów” deposit in 2017. Simultaneously, the Company is continuing to analyse the K-6, K-7 and “Orzechów” deposits as prospective areas for future mining operations.

The extraction of the “Ostrów” deposit may be started with the use of the existing infrastructure, without the capital intensive construction of new shafts. The plans assume that after the year 2025 vertical deposits will be prepared for mining and the necessary facilities and technical infrastructure will be built on the “Ludwin” field. Preliminary estimates show that the total capital expenditures required to build such infrastructure will amount to PLN 1.2 - 1.3 billion (in real terms).

Before the application for the mining licence was filed, various hydrogeological, geological & engineering and other research works were performed under the prospecting licence granted to the Company in June 2014. LW Bogdanka has also prepared an environmental impact report and obtained a decision of the Regional Environment Protection Directorate in Lublin on the environmental conditions of the “Ostrów” project within the boundaries of the planned “Ludwin” mining area and zone. The process of preparation of the licence application lasted several years and involved tens of employees of Bogdanka.

 

“The hard coal mining sector requires far-sighted management and planning many years in advance. Therefore, already today we’re submitting our application for a mining licence for coal extraction from the “Ostrów” deposit – as assumed in our strategy announced in the beginning of this year we are planning to double our exploitable resources in the Lublin Coal Basin. Assuming the annual production at the level of about 9 million tonnes, the mine will be able to continue its operations for about 50 years. We want to increase our exploitable resources to ensure the development of the mine and a stable source of fuel for the Enea Group. And this in turn should ensure stable employment for future generations of miners as well as Bogdanka’s support for the development of local communities and the entire Lublin region for several decades,” – said Krzysztof Szlaga, President of the Management Board of LW Bogdanka S.A.


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czytaj-aktualnosc/2644/bogdanka-applies-for-licence-for-coal-extraction-from-ostrow-deposit/ 2017-07-17 00:00:00 2644
LW Bogdanka after the first quarter of 2017 – good financial and operating results despite prevailing low prices of coal In Q1 2017 the Lubelski Węgiel Bogdanka Group generated revenue in the amount of PLN 465.2 million (growth by 10.6% y/y) and net profit of PLN 68.2 million (growth by 25.2% y/y). In the period in question, EBIT amounted to PLN 89.7 million (up by 13.8% y/y), while EBITDA totalled PLN 179.8 million (up by 3.7% y/y).

LW Bogdanka believes the achieved financial results are good. Increase in sales combined with a simultaneous consistent cost control and optimisation of capital expenditure made it possible to maintain high profitability ratios despite low prices of coal. The Company’s EBITDA in Q1 2017 reached 38.7%, and continues to be one of the highest in the coal sector. 

Commercial coal production in Q1 2017 amounted to over 2.4 million tonnes. Sales in the period remained on the similar level, which means that it increased by 9.4% y/y.  The length of gallery workings completed in the first three months of 2017 totalled more than 7.9 km, which represents a growth by 23.4% compared to the same period of 2016.

Bogdanka retains a strong market position. After Q1 2017, the Company’s share in the market of thermal coal sales accounted for 17.8%, and its share in the market of thermal coal sales to commercial power plants accounted for 25.7%.

“Given the prevailing low prices of coal, I think that LW Bogdanka’s financial results after the first quarter of 2017 are favourable.  The implementation of production and sales plans, including coal sales higher by 9.4%, as well as consistent cost control and optimisation of capital expenditure made it possible to obtain such results. We maintain our strong position and a high market share, and remain the most effective and the most modern hard coal mine in Poland,” said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka.

“One of the most important moments of the last quarter was when Bogdanka announced a development strategy for the Mining Area of the Enea Group until 2025, within the 2030 framework. The strategy provides for two development scenarios: baseline scenario and flexible development scenario which assumes average annual production of coal at a level of approx. 9.2 million tonnes.

Taking into account the current and expected market situation, we are implementing the flexible development scenario. This year our plan is to achieve production at a level of about 9 million tonnes. The presented strategy contains such key initiatives as ensuring close cooperation and synergies in the Kozienice-Bogdanka-Połaniec mining and power generation area, to double its exploitable resources and to implement various innovative strategic projects. In accordance with the dividend policy presented in the Strategy, at the end of April, the Bogdanka’s Management Board recommended that a dividend from 2016 profit should be paid in the amount of PLN 1 per share,”said Krzysztof Szlaga.


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czytaj-aktualnosc/2633/lw-bogdanka-after-the-first-quarter-of-2017-good-financial-and-operating-results-despite-prevailing-low-prices-of-coal/ 2017-05-25 00:00:00 2633
Green Frog Award 2016 for Bogdanka The LW Bogdanka Group’s Integrated Report for 2015 (published in 2016) was recognised in the prestigious contest for the Deloitte Central European Sustainability Report Award, commonly referred to as the Green Frog Award (GFA).

On 19 April 2017 in Warsaw, the representatives of the Lublin mine, including the President of the Management Board Krzysztof Szlaga, had the pleasure to collect the main award. Five countries participated in the contest: Croatia, Czech Republic, Poland, Romania, and Hungary. A total of 65 reports were submitted to the national level, 13 out of them advanced to the regional level, and 5 competed for the main award. The Green Frog Award was launched in 2009 in Hungary and gradually widened its scope to embrace other countries of the Central Europe.  Since 2015 the GFA has been divided into two levels: national and regional. Reports which receive an award or a distinction at the national level automatically qualify for the regional level.

“Members of the jury recognised the Integrated Report of Lubelski Węgiel Bogdanka S.A. for showing strong ties between indicators and CSR issues, and for demonstrating great understanding of human rights. The judges representing such institutions as ACCA, Ethical Corporation, GRI, Polish Ministry of Development, Hungarian Business Council for Sustainable Development (BCSDH) also appreciated the way Bogdanka described the dialogue with the stakeholders before an investment is made, which shows a sensible approach to Corporate Social Responsibility,” says Irena Pichola, Partner, Deloitte’s Sustainable Development Team Leader for Poland and Central Europe.

We would like to congratulate the contestants, above all for the fact that by publishing integrated reports they are able to clearly communicate all the information about their organisations to the stakeholders, including both financial information and information which goes deeper and further than the finances and at the same time makes it possible to correctly interpret financial results and reliably assess the entire organisation.

We are glad that as a raw-material part of the Enea Group we can contribute to the development of transparency and complexity of reporting, both in Poland and in a wider European context.

Above all, however, we must emphasise the enormous contribution and commitment of all the people – employees of Bogdanka and third parties – who shaped the final wording and format of the document, and earned its recognition in the eyes of the jury.

 


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czytaj-aktualnosc/2631/green-frog-award-2016-for-bogdanka/ 2017-04-19 00:00:00 2631
LWBogdanka after 2016 - good operating and financial results despite the continuing difficult market situation In 2016 the Lubelski Węgiel Bogdanka Group generated revenue of PLN 1.8 billion, and net profit of PLN 182 million. In the period in question, EBIT amounted to over PLN 237 million, while EBITDA totalled PLN 606.5 million. Coal prices, which still remained low on a year-on-year basis despite the relative stabilisation in Q4 2016, had a significant influence on the financial results.


The Company believes that these are good results which stand out against a backdrop of the Polish mining industry. Continuous cost control and optimisation of capital expenditure made it possible to maintain high profitability ratios despite the fact that the sale price of coal went down by more than 10% year on year. As a result, EBITDA in 2016 remained at an above-average level of 34% in relation to other operators in the world’s mining industry.

In 2016 commercial coal production reached over 9 million tonnes. Sales in this period remained at a similar level of 9.1 million tonnes. The length of gallery workings completed in the last year totalled 23.8 km, which shows an increase of 19% compared to 2015.

The Company retains a strong market position. After 2016, the Company’s share in the market of thermal coal sales accounted for 15.9%, and its share in the market of thermal coal sales to commercial power plants accounted for 25.4%. That means that the Company has come back to levels similar to those achieved in 2014, in the aftermath of the turbulence on the Polish coal market in 2015.

In connection with the development strategy of LW Bogdanka S.A. - Mining Area of the Enea Group until 2025, under the 2030 framework, which was published this year in February, and the flexible development scenario contained in that strategy, the production plans for 2017-2025 provide for an average annual coal production of about 9.2 million tonnes.

 

“The level of extraction and sales achieved in 2016 translated into robust financial results. Our performance makes us all the more proud as we managed to achieve it in a continuing difficult market environment – the last year for our industry was a year characterised by oversupply of coal and declines in coal prices on the Polish market. The coal prices increased significantly on global markets during the year, but that soar did not affect the situation in Poland in 2016. Nevertheless, it was a positive signal for our industry,” said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka S.A.

“2016 was the first full year in which we operated as a member of the Enea Group. During that period we developed a number of synergies. This has allowed us to further improve our cost efficiency, which has for many years now remained the highest in the industry. The integration with the Group and the resulting benefits related to operations and costs make it possible for us to achieve the good and planned operational and financial indicators. Yet another important achievement of the last year is a significant improvement in the long-term safety of extraction in Bogdanka. We made it possible by signing important annexes to agreements with our key customers in the second half of the year – the Enea Group and Połaniec Power Plant, as well as the Azoty Group and ENERGA Elektrownie Ostrołęka. This has given us solid foundations for the upcoming years to make long-term plans regarding our production, employment and preparatory works. This, in turn, will make it easier for us to control the costs, which has always been a matter of particular importance for our Company,” said Krzysztof Szlaga.


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czytaj-aktualnosc/2627/lwbogdanka-after-2016-good-operating-and-financial-results-despite-the-continuing-difficult-market-situation/ 2017-03-31 00:00:00 2627
LW Bogdanka S.A. reveals its strategy – company wants to continue flexible development, double its raw material resources and pursue innovations

LW BOGDANKA S.A. REVEALS ITS STRATEGY – COMPANY WANTS TO CONTINUE FLEXIBLE DEVELOPMENT, DOUBLE ITS RAW MATERIAL RESOURCES AND PURSUE INNOVATIONS
A KEY ELEMENT OF THE STRATEGY WILL BE SYNERGIES IN THE KOZIENICE-BOGDANKA-POŁANIEC MINING AND POWER GENERATION AREA

 

LW Bogdanka S.A., the most advanced  and most efficient hard coal mine in Poland and a member of the Enea Group, one of the leaders in Poland’s power market, presented a development strategy for the Mining Area of the Enea Group. The strategy covers a period until the year 2025, within the 2030 framework. The strategy is in line with the Strategy of the Enea Group and reflects both Responsible Development Plan and Polish Hard Coal Mining Programme.

The strategy of LW Bogdanka in the Mining Area of the Enea Group includes two development scenarios: baseline, which assumes average production at a level of about 8.5 million tonnes a year over 2017-2025, and flexible development, with average annual production at a level of about 9.2 million tonnes over the same period. Taking into account the current and expected market situation, the Company wants to implement the flexible development scenario. CAPEX forecast for 2016-2025 (nominally) amounts to PLN 3.7 billion for the baseline scenario and about PLN 4 billion for the flexible development scenario.


LW Bogdanka, which is responsible for the Mining Area in the Enea Group, wants to pursue certain key initiatives to ensure close cooperation and synergies in the Kozienice-Bogdanka-Połaniec mining and power generation area, to double its exploitable resources and to implement various innovative strategic projects. Within the framework of such ventures, LW Bogdanka will prepare, jointly with the Enea Group, a feasibility study for a project to deploy the integrated gasification combined cycle (IGCC) technology which is to provide fuel for power generation; use leading-edge high-performance face complex; continue its “Smart Mine” programme; efficiently manage waste rock; and develop an operator’s services, offered on the basis of high technology and management standards of the Company. Compliance with the highest work safety standards and with corporate social responsibility (CSR) rules is invariably one of the top priority components of the strategy.

The Company expects that the flexible development scenario will reduce the Unit Mining Cash Cost by 10% by 2025 (in real terms, as compared to 2015). Over the same period, the Return on Equity (ROE) ratio should grow to 10.9% (from 8.7% in 2015), the Return on Assets (ROA) ratio is expected to increase to 8.5% (from 5.3% in 2015) and EBITDA will rise, nominally, by 44% (as compared to 2015, adjusted by revaluation).   
 
LW Bogdanka S.A. also announced its dividend policy for the near future. It assumes that the Company will request that up to 50% of its net profits shown in its separate financial statements be allocated for dividend.

 

SYNERGIES IN THE KOZIENICE-BOGDANKA-POŁANIEC MINING AND POWER GENERATION AREAC

The Enea Group has signed with ENGIE International Holdings B.V. an agreement on the conditional purchase of 100% of shares in ENGIE Energia Polska, which is the owner of the Połaniec Power Plant.
After this takeover, the Enea Group will include two key clients of LW Bogdanka. As a result, the Kozienice-Bogdanka-Połaniec mining and power generation area will emerge in south-east Poland.

This will bring about various benefits to both LW Bogdanka and the Enea Group and a further efficiency improvement in the generation of power from coal supplied by Bogdanka. This will also strengthen the market position of the Enea Group as one of the leading producers of electricity in Poland. For Bogdanka, in turn, this means more operational stability and a possibility of planning its production and employment levels over a long time horizon.

 

DEVELOPMENT OF RESOURCE BASE AND LONGER LIFE OF THE MINE

LW Bogdanka intends to double its exploitable resources in the Lublin Coal Basin (from 227 million tonnes at present to about 446 million tonnes). Assuming the annual production at the level of approximately 9 million tonnes, the mine will be able to continue its operations for about 50 years (as compared to the expected life span of 25 years at present).

For the presented strategy, the key mining areas for the Company include Puchaczów V (deposit currently in use of about 211 million tonnes), Stręczyn (K-3 deposit, currently in use, with exploitable resources of about 16 million tonnes) and Ludwin (Ostrów deposit with estimated exploitable resources of about 186 million tonnes).

The Company is planning to obtain a mining licence for the Ludwin area (Ostrów deposit) in 2017. Simultaneously, Bogdanka will continue to analyse the K-6 and K-7 deposits and the Orzechów area as prospective areas for future mining operations.

 

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Because of its crucial importance to the region, one of the Company’s goals, as always, is to run its business operations in compliance with the rules of corporate social responsibility (CSR), which include ensuring the highest work safety standards, environmental effectiveness, the protection of local biodiversity, the stimulation of development and a guarantee of security for local communities, as well as the effective management of relationships with all groups of stakeholders - all these in line with the principles of sustainable growth.

 

INNOVATIONS IN LW BOGDANKA - STRATEGIC INITIATIVES

In the course of preparations of the strategy for the Enea Group, 60 strategic initiatives have been conceived, of which 10 by engineers from Bogdanka.


The top priority projects include:

Feasibility study of construction of an integrated gasification combined cycle (IGCC) system

The Company will prepare, jointly with the Enea Group, a feasibility study of construction in LW Bogdanka of an integrated gasification combined cycle (IGCC) system for production of fuel for power generation.  If it is decided to implement the project, a new market for hard coal will emerge, leading to a higher energy independence of Poland’s economy.

 

Advanced high-performance face complex

The high-performance face complex project is an element of the initiatives which have been pursued for years by LW Bogdanka to promote innovative solutions that increase its operational efficiency.
The project is to shorten the time in which heading excavations must be maintained and to achieve the above-average progress of work to drill roadway excavations. 

 

Smart Mine

Even today LW Bogdanka has solutions that are unique in Poland’s underground mining sector. They support decision making in the process of preparation of deposits for extraction and employ the most recent technological developments introduced in the global mining sector.

The Company intends to retain its position of the efficiency and innovation leader in the mining sector, also by continuing its “Smart Mine” programme. Those activities will cover the further development of the deposit management system and the continued computerisation and automation of the production chain in the Company.

 

Effective waste rock management

The waste rock management project is to improve even further the control of quality of the coal output by optimising its production - from planning to deposit cutting and exploitation to liquidation of excavations. The scenarios being considered include placing the waste rock underground and using it for road construction.
The programme is to improve the quality of raw coal by reducing the content of waste rock in the output, to minimise waste rock pollutions and to reduce the costs of mining waste, including to extend the life span of waste stockpiles. 

 

LW Bogdanka as provider of an operator’s services

LW Bogdanka wants to use its top-class technology and management standards and leading know how to develop a new line of business - services of an operator of mining plants provided for entrusted assets. Such services would be offered throughout Central and Eastern Europe.

 

Further work safety improvement programme

For years, work safety has been a top priority for LW Bogdanka. Also the current strategic framework considers the safety and health of employees to be an issue of overriding importance.  

 

CAPITAL EXPENDITURES

The baseline scenario assumes CAPEX in the amount of PLN 3.7 billion (nominally) over 2016-2025. If the flexible development scenario is opted for, capital expenditures will increase to about PLN 4 billion, mainly in connection with the planned expenditures for mining machinery and equipment.

The above capital expenditure level also includes initial activities related to the Ostrów project, which is a must if LW Bogdanka wants to maintain the assumed production level after 2030.
Preliminary estimates show that the total capital expenditures required to start the exploitation of the Ostrów deposit will amount to PLN 1.2-1.3 billion (in real terms). Those expenditures would be spent to create the OG “Ludwin” mining plant (on the Ostrów deposit), which will be built after 2025 and, therefore, they are not included in the estimated capital expenditures in the current Strategy (except initial outlays of PLN 70 million).

The above amount of capital expenditures also excludes the potential implementation of strategic initiatives by the Company.

 

DIVIDEND POLICY

In the future, the Management Board of LW Bogdanka S.A. intends to ask the General Shareholders Meeting for approval of dividends up to 50% of the net profits shown in the Company’s separate financial statements, prepared in accordance with the International Financial Reporting Standards.

Each time, the dividends recommended by the Management Board will depend on:

  • current market situation,
  • generated operating cash flows,
  • planned capital expenditures and investments,
  • projected debt of the Company.

 

“The strategy of LW Bogdanka reflects the strategy of the Enea Group presented in October 2016, the primary goal of which is to build an innovative raw material and power group able to successfully face up to market challenges. Our most important task for the next few years is to create an appropriate synergy between mining and power generation assets on the basis of LW Bogdanka and the leading-edge power generation resources of the Enea Group, including the Połaniec Power Plant, which we are taking over right now. The Kozienice-Bogdanka-Połaniec mining and power generation area, situated in south-east Poland, will bring about various beneficial synergies and will strengthen the position of the Group on the Polish market. We also want to continue to set trends as regards innovation, both in the power sector and – via LW Bogdanka, responsible for the Mining Area in the Group – in the hard coal mining sector,” said Mirosław Kowalik, President of the Management Board of Enea S.A. and Chairman of the Supervisory Board of LW Bogdanka.

 

“The strategy we have just announced defines in detail the key objectives for the Mining Area which are presented in the strategy of the Enea Group, published in October 2016. Because of changing market conditions in our industry, we have prepared both a baseline scenario, which assumes production at the average annual level of about 8.5 million tonnes over 2017-2025, and a flexible development scenario, with the average annual production of about 9.2 million tonnes in the same period. After analysing the market environment, we are inclined to opt for the flexible development scenario,” said Krzysztof Szlaga, President of the Management Board of LW Bogdanka S.A.

“The key pillars of our strategy until 2025 will include the active utilisation of synergies in the Kozienice-Bogdanka-Połaniec mining and power generation area, as the next step of integration within the ENEA Group, and efforts to double our exploitable resources. As always, we will also pursue innovations, which are a vital component of Bogdanka’s strategy. We intend to retain our position of the efficiency and innovation leader in the mining sector, also by continuing our “Smart Mine” programme or by implementing initiatives to ensure a more effective management of waste rock or the utilisation of our high-performance face complex. We are also planning to prepare, jointly with the Enea Group, a feasibility study of construction of an integrated gasification combined cycle (IGCC) system which is to provide fuel for power generation,” added Krzysztof Szlaga.

“In the medium and long run, we want to share earnings with our shareholders by distributing up to 50% of our stand-alone net profits as dividends. Taking into account the volatile market conditions in our sector, our priority is, obviously, to keep the financial and liquidity security of our Company. Therefore, dividends will always be recommended after an in-depth analysis,” continued the President of the Management Board of LW Bogdanka S.A.

 

“Even before the Ministry of Energy was established, I kept emphasising on every occasion that the best option to reform the Polish mining sector would be the integration of coal mining and power generation. We have been consistently implementing this plan for over a year, i.e. since the Ministry of Energy was created. And our consistent activities have been winning more and more trust in the market, promising stabilisation. Symbiosis between the power and mining sectors is possible and mutually beneficial. And the Bogdanka mine and the Enea Group are an excellent example here. As shareholders, power companies gain access to low-cost fuel and stable supplies. Bogdanka also takes advantage of such relationships as it has a guarantee of sale of its output. And the planned development of the power generation resources of Enea Wytwarzanie means stable operations in the future. It should also be noted that Enea intends to build, in the immediate vicinity of the Bogdanka mine, the first European power plant using the so-called clean coal technology. This is just another reasonable example of synergies between the power and coal sectors. I believe that the decisions which are now being considered in the European Union will let us still use the potential of our fuel and power sectors for production of clean coal energy,” said Grzegorz Tobiszowski, Secretary of State in the Ministry of Energy and Government Plenipotentiary for Hard Coal Mining Restructuring.

 

We invite you to PRESS RELEASE.


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czytaj-aktualnosc/2625/lw-bogdanka-s-a-reveals-its-strategy-company-wants-to-continue-flexible-development-double-its-raw-material-resources-and-pursue-innovations/ 2017-02-10 00:00:00 2625
LW Bogdanka extends the agreement with Energa Elektrownie Ostrołęka until 2019 The Lubelski Węgiel Bogdanka Group has signed an annex to the Long-Term Agreement for Sale of Thermal Coal with ENERGA Elektrownie Ostrołęka S.A. The Annex extends the term of the Agreement until the end of 2019 (initially, the Agreement was to end on 31 December 2016) and sets forth the terms and conditions of supplies in 2017.

As a result, the current value of the entire Agreement (in effect from 1 January 2011 to 31 December 2019) amounts to PLN 1.33 billion net (without regard to possible increases, deviations and tolerance), which represents an increase of 12% as compared to the amount specified in Report No. 53/2015). The value of the Agreement in 2017-2019 will total PLN 134 million net.

 

“By extending the agreement for the supply of coal to the Ostrołęka Power Plant until 2019, we have taken yet another step towards securing long-term extraction at LW Bogdanka. In the second half of this year, we have also concluded another three important annexes to agreements with our key customers. The first one was concluded with the Enea Group for 20 years. Within the first 10 years of the contract, Bogdanka will sell 5 million tonnes of coal per annum to Enea. The second one is a five-year contract concluded with the Połaniec Power Plant. The third one is a contract with Grupa Azoty Zakłady Azotowe Puławy which has been extended until 2021. As a result, we begin the new year with a sound basis for long-term planning of production, employment and preparatory works. This, in turn, will make it easier for us to control the costs, which is a matter of particular importance in the context of the current complex situation on the Polish coal market,” said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka S.A.


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czytaj-aktualnosc/2610/lw-bogdanka-extends-the-agreement-with-energa-elektrownie-ostroleka-until-2019/ 2016-12-29 00:00:00 2610
Bogdanka after Q3 2016 - yet another quarter of good results despite still difficult market situation LW BOGDANKA AFTER Q3 2016 - YET ANOTHER QUARTER OF GOOD RESULTS DESPITE STILL DIFFICULT MARKET SITUATION

 

After the three quarters of 2016, the Lubelski Węgiel Bogdanka Group generated revenue of PLN 1.3 billion (at a similar level to the one achieved last year despite lower coal prices) and net profit of PLN 120.2 million (lower by over 9% compared to the previous year). In the period in question, EBIT amounted to PLN 154.6 million (a decrease of 11.4% y/y), while EBITDA totalled PLN 432.3 million (a decrease of 5.6%).

The Company believes the achieved financial results are very good. Continuous cost control and optimisation of capital expenditure made it possible to maintain high profitability ratios despite the fact that the sale price of coal went down by nearly 11% year on year. As a result, EBITDA after the three quarters of 2016 remained at an above-average level of 32.9% in relation to other operators in the world’s mining industry.
 
In Q3 2016, commercial coal production reached 2.4 million tonnes. Sales in this period also remained at the level of 2.4 million tonnes. As a consequence, after the three quarters of 2016, both production and sales of commercial coal amounted to about 6.7 million tonnes. The length of gallery workings completed in the first nine months of 2016 totalled 17.2 km, an 11% increase compared to the same period of 2015.

As it has previously announced, the Company estimates that the production and sales of coal in 2016 will range between about 8.5 and 9 million tonnes. After the three quarters of 2016, the Company already achieved almost 75% of the upper range of the announced annual extraction and therefore the full-year extraction and sales is expected to reach nearly 9 million tonnes.  


The Company retains a strong market position. After Q3 2016, the Company’s share in the market of thermal coal sales accounted for 15.7%, and its share in the market of thermal coal sales to commercial power plants accounted for 25.9%.  That means that the Company has come back to levels similar to those achieved in 2014, in the aftermath of the turbulence on the Polish coal market in 2015.

 

 

“Given the current market conditions, I believe that the financial results that we have achieved in the three quarters of 2016 are very good. Continuous and consistent cost control and optimisation of capital expenditure made it possible to obtain such results. We keep liquidity on a safe level and remain the most effective and the most modern hard coal mine in Poland. Our mine provides timely supplies of more than a quarter of coal required by Polish power plants,” said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka S.A.
 
“In Q3 2016 we strengthened our long-term security of extraction by signing annexes to long-term agreements with Enea Wytwarzanie Sp. z o.o. which increased our supplies to Enea. The annexes confirm the benefits that Bogdanka gains as a result of joining the Enea Group and co-building a modern raw materials and energy corporation. At the end of the quarter we also signed an annex which extends until 2021 an agreement for the supplies of coal to Połaniec Power Plant that we have concluded with ENGIE Energia Polska S.A. Those agreements give us solid foundations for the upcoming years to make long-term plans regarding our production, which will translate into a better cost position. This is particularly important in the midst of the difficult situation on the Polish coal market. Although the third quarter saw a clear growth of coal prices on international markets, the prices of coal in Poland remain low,”
 said Krzysztof Szlaga.

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czytaj-aktualnosc/2607/bogdanka-after-q3-2016-yet-another-quarter-of-good-results-despite-still-difficult-market-situation/ 2016-11-10 00:00:00 2607
LW Bogdanka extends the agreement for the supply of coal to the Połaniec Power Plant LW BOGDANKA S.A., the most modern and efficient hard coal mine in Poland, which is part of the Enea Group,one of the leaders of the Polish power market, has signed an annex to the agreement with ENGIE Energia Polska Spółka Akcyjna regarding supplies of thermal coal for the purposes of the ENGIE power plant in Połaniec.
 

The Annex extends the term of the agreement until the end of 2021 (previously the agreement was in effect until 2019). Therefore, the Agreement currently covers thermal coal supplies in 2013-2021.
 

The annex also sets out the terms and conditions of thermal coal supplies for the purposes of the buyer in the period 2017-2021, the volumes of supplies for each year during the term, the coal price applicable to supplies in 2017, the price formula applicable between 2018 and 2020, and the manner in which price will be calculated in 2021.
 

The value of the entire agreement after the annex has been concluded amounts to about PLN 3.399 billion net, and is 8.8% higher than the previously-estimated value.

 

By extending the agreement for the supply of coal to the Połaniec Power Plant until 2021 after we have developed our cooperation with the Enea Group, we have tightened LW Bogdanka’s long-term security of extraction. This, in turn, will make it easier for us to plan production in the long perspective, and will translate into a better price position, which is particularly important in the current challenging situation on the Polish coal market. Our aim is to remain the most effective and the most modern hard coal mine in Poland,” said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka S.A.


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czytaj-aktualnosc/2605/lw-bogdanka-extends-the-agreement-for-the-supply-of-coal-to-the-polaniec-power-plant/ 2016-10-03 00:00:00 2605
LW Bogdanka to increase coal supplies to Enea Group from 2017 Lubelski Węgiel Bogdanka Group has signed annexes to its long-term agreements with Enea Wytwarzanie Sp. z o.o. to increase the volumes of Bogdanka’s supplies to Enea Group, starting 2017.  
 

The annex to Long-Term Agreement II, effective from 2017 to 2036, expands the scope of cooperation between the two Enea Group companies. As a result of signing the annex, the value of the entire Long-Term Agreement II, effective from 2017 to 2036, will amount to PLN 13.97 billion net, i.e. will increase by 24.20% compared to the original agreement signed in January 2012. Approximately 64% of this amount, i.e. PLN 8.95 billion net, will come in the period 2017-2025.
 

The annex to Long-Term Agreement I, which concerns coal supplies for the currently operated power plant units (and which was terminated by Enea Wytwarzanie Sp. z o.o. in August 2015 and expires at the end of 2017), defines the price and volumes of supplies in 2016-2017. As a result of signing the annex, the value of the entire Long-Term Agreement I, effective from 2011 to 2017, will amount to PLN 4.64 billion net, i.e. will decrease by 8.19% in relation to the previously estimated value.
 

As a result of signing the annexes, the total value (estimated according to current prices) of Long-Term Agreement I and Long-Term Agreement II in the period 2011-2036 amounts to approx. PLN 18.61 billion net.
 

“Since October 2015, LW Bogdanka has been a vital element of the Enea Group value chain. The annexes to long-term agreements we have just signed are another step towards achieving optimal performance of the Group in the extraction and production area, primarily in the mid- and long-term. They will be a solid foundation for advancing in the fulfilment of our sustainable development potential in these areas and increasing our competitive advantage. Close cooperation and further integration of LW Bogdanka within the Group will commercially benefit all parties, and the long-term securing of fuel for the production of electrical energy will also ensure higher security of energy supply to our customers”, said Piotr Adamczak, Vice-President of the Management Board for Commercial Affairs at ENEA S.A.


“The signing of annexes to the long-term agreements, which increase the supplies to Enea, simply confirms the benefits of joining the Enea Group by Bogdanka to build a modern raw materials and energy corporation. The larger volume of supplies to our parent company means higher security of extraction levels at LW Bogdanka and strengthening of the position of our company in the difficult coal market in Poland. The annexes further tighten the business relations between the two companies, which now belong to a single Group: for years, Bogdanka has been the key supplier of Enea, and Enea has been Bogdanka’s largest customer”, said Krzysztof Szlaga, President of the Management Board of Lubelski Węgiel Bogdanka S.A.


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czytaj-aktualnosc/2602/lw-bogdanka-to-increase-coal-supplies-to-enea-group-from-2017/ 2016-09-29 00:00:00 2602
LW Bogdanka Capital Group after H1 2016: mining according to the plan, good financial performance The Capital Group of Lubelski Węgiel Bogdanka in H1 2016 generated sales revenue on the level of over PLN 848.9 mln and net profit in the amount of almost PLN 75 mln. It means that despite further drop in prices, both the revenue and net profit were kept on the level close to the same period of the previous year. EBIT result in the said period amounted to PLN 96.6 mln (drop by 4.7 per cent yoy) and EBITDA: PLN 277.4 mln (drop by 4.9 per cent).


The company estimates the generated financial results as good. Their generation, despite a negative impact of the unstable situation on the market and persistent low coal prices was possible due to a constant cost control and optimisation of capital expenditures. In result, EBITDA profitability in H1 2016 was maintained on an over average level for the global industry, namely 32.7 per cent.

In H1 2016 the production of commercial coal reached the level of 4.3 mln tonnes, and sales of 4.4 mln tonnes. The length of corridor excavations performed in that period amounted to 12.1 km, which means a growth by 18.6 per cent as compared to H1 2015.

The company maintains a strong market position and in Q2 2016 returned to the share in steam coal sales market to commercial power industry achieved in 2014 on the level of ca. 25 per cent. Similarly, the total share of the steam coal market achieved again the level of ca. 16 per cent. According to the earlier announcements, the Company estimates coal sales in 2016 ranging from 8.5 to 9.0 mln tonnes.

 

 

- I estimate the financial results generated in H1 2016 as good. Their generation in extremely unfavourable market conditions was possible due to a continuous and consistent cost control and optimisation of capital expenditures. We are upholding a safe financial liquidity and remain the most efficient and modern bituminous coal mine in Poland. Even though in the second quarter coal price increases were observable on international markets, the prices of this material in Poland remain on a very low level and oversupply on the coal market is persistent. Therefore, at the moment we cannot yet see grounds for expecting any change in the present market trends in a close perspective. According to the earlier announcements, we estimate our annual coal sales on the level of 8.5-9.0 mln tonnes - said Krzysztof Szlaga, the president of Lubelski Węgiel Bogdanka

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czytaj-aktualnosc/2600/lw-bogdanka-capital-group-after-h1-2016-mining-according-to-the-plan-good-financial-performance/ 2016-08-26 00:00:00 2600
LW Bogdanka finished drilling of boreholes under the prospecting license for the Ostrów deposit Bogdanka, 19 July 2016

 

 

LW BOGDANKA FINISHED DRILLING OF BOREHOLES UNDER THE PROSPECTING LICENSE FOR THE OSTRÓW DEPOSIT

 

LW BOGDANKA S.A. finished drilling works related to drilling of two boreholes under the prospecting license for the Ostrów deposit.

The works covered drilling of two boreholes where hydrogeological, geological and engineering as well as gas studies were conducted among other studies, which will allow a thorough analysis of geological substratum. Drilling works were performed in the town of Dratów Kolonia in the Ludwin commune.

The works were performed under the prospecting license granted to the Company in June 2014. In total, three wells were made under the said license.

Based on the exploratory drilling, Bogdanka is planning to develop a supplement to geological documentation, prepare the Ostrów deposit development project and request the Minister of Environment in Q1 2017 for an exploration license for the Ostrów deposit.

Obtaining new exploitable resourcesis one of the strategic objectives of LW Bogdanka S.A. As a result of gaining access to the Ostrów deposit, the Company’s exploitable resources may increase by approx. 200-350 million tonnes (depending on the exploration license conditions)versus approx. 230 million tonnes at present. It means that the mine lifecycle can be extended from approx. 2042 (assuming current production level) to even 2080.

The Company also has the prospecting license for the Orzechów deposit and continues its efforts to obtain the exploration license for the K-6, K-7 deposit. All the aforementioned deposits are located in close vicinity to Bogdanka and constitute its natural supply base.  Extraction of the Ostrów and K-6, K‑7 depositsmay be started with the use of the existing infrastructure without the capital-intensive construction of new shafts. This in turn guarantees maintenance of high productivity of the mine where at present the underground labour productivity is over two times higher than the Poland’s average in the hard coal mining sector.


In coal mining nothing happens overnight. The actions we take today to significantly expand exploitable resourcesare to secure future development of Bogdanka and stable supply of resources for the Enea Group. We wish to extend the mine’s lifecycle at least by 2080, thus ensuring jobs and employment stability for future generations of miners as well as Bogdanka’s support for development of local communities and the entire Lublin region for several decades. Doubling the coal reserves will also materially contribute to building the Company’s value for shareholders,” said Krzysztof Szlaga, President of the Management Board of LW Bogdanka S.A.


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czytaj-aktualnosc/2598/lw-bogdanka-finished-drilling-of-boreholes-under-the-prospecting-license-for-the-ostrow-deposit/ 2016-07-19 00:00:00 2598
LW Bogdanka Publishes Integrated Report for 2015 We are happy to present you our latest publication, i.e. the Integrated Report for 2015.

This Report is the third report prepared by LW Bogdanka in accordance with the Global Reporting Initiative (GRI) guidelines, and the second integrated report combining both financial and non-financial results. It covers the year 2015. As the previous report, the current report is prepared ‘in accordance’ with GRI G4 in ‘core’ option, but, in addition, using the International Integrated Reporting (“IR”) Framework. The report also presents indicators specific for the mining sector, which are described in the relevant sector supplement.


The Report covers the entire LW Bogdanka group of companies as it is consolidated for financial reporting purposes. Therefore it includes the parent, i.e. LW Bogdanka S.A., its subsidiary Łęczyńska Energetyka Sp. z o.o., and three smaller companies (RG Bogdanka sp. z o.o., EkoTrans Bogdanka sp. z o.o. and MR Bogdanka sp. z o.o.). As those three smaller companies exert rather an insignificant impact on the financial, social and environmental situation of the Group, their description in the report is narrowed to certain aspects. Nonetheless, this approach follows the concept of the GRI Guidelines, which recommend that only material aspects should be reported.


The reliability of the report and its compliance with the Guidelines was monitored by a third party expert who supported its preparation, however the report was not submitted to external verification.
The contents of both previous reports and this year’s report were defined based on the results of a workshop which was held in October 2013 and made part of works on the CSR strategy 2014-2017 (attended by nearly twenty managers). Referring to the areas of social responsibility described in the PN-ISO 26000 standard, the workshop specified those areas which are material from the perspective of the business activity conducted. Direct reference to ISO 26000 ensured that the context of sustainable development was maintained. Since 2013 no significant organisational changes have been implemented, including changes in the scope of the Group’s business, which could affect the nature of its social or environmental influence. Similarly, the map of stakeholders used for the preparation of the CSR Strategy for 2014-2017 has been considered valid. The preparation of the Report itself involved interviews with managers responsible for relationships with individual stakeholders. That approach enabled in the end to define the content of the report under observance of materiality, completeness and stakeholder inclusiveness principles. At the same time, the manner in which data was collected, analysed and presented in the report was aimed at maintaining highest diligence in the context of balance, comparability, accuracy, timeliness, clarity and reliability principles.

We invite you to download and read the Integrated Report for 2015.


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czytaj-aktualnosc/2595/lw-bogdanka-publishes-integrated-report-for-2015/ 2016-06-20 00:00:00 2595
LW Bogdanka Group after q1 2016: better financial results and improved profitability ratios LW BOGDANKA GROUP AFTER Q1 2016: BETTER FINANCIAL RESULTS AND IMPROVED PROFITABILITY RATIOS

 

In Q1 2016, Lubelski Węgiel Bogdanka Group generated sales revenue on the level of almost PLN 420.6 mln, which were by 1.8 per cent lower than in the same period of the previous year. At the same time, the other key financial results improved: EBIT amounted to PLN 78.9 mln (growth by 63.8 per cent yoy), EBITDA PLN 173.3 mln (growth by 20.0 per cent yoy) and net result PLN 54.4 mln (growth by 66.6 per cent).

Generation of good results was possible due to flexibility of operations and consistent realisation of the optimisation of capital expenditures and cost reduction programme commenced last year. The cost of sold production was reduced by PLN 39.3 mln (i.e. 10.3 per cent) in relation to Q1 2015 and total production costs by PLN 24.8 mln (i.e. 6.4 per cent). As a consequence, profitability ratios improved. EBITDA margin was above average totalling to 41.2 per cent (against 33.7 per cent in the same period of the previous year). It is however worth mentioning that it was affected by the increase in the level of production and stock in Q1 2016. As a result, maintaining profitability ratios on such a high level in subsequent quarters seems very improbable.

In Q1 2016 commercial coal production reached the level of 2.3 mln tonnes (by 17.3 per cent more than on an annual basis) and sales 2.2 mln tonnes (growth by 12.2 per cent). The length of the performed corridor excavations performed in that period amounted to 6.4 km and was greater by 23.1 per cent as compared to Q1 2015. Total expenditures incurred for new excavations and modernisation of the existing ones totalled to almost PLN 44.8 mln.

Increasing production and sales of coal allowed Bogdanka to strengthen the market position in Q1 2016. The share in the supplies of the raw material to the commercial power industry in that period amounted to 25.5 per cent (in Q1 2015 it was 20.9 per cent, and in the whole 2015 22.5 per cent). The share in the fuel coal market grew to 15.8 per cent in general (against 14.3 per cent yoy and 14.4 per cent in the whole previous year).

The Company estimates coal sales in 2016 on the level of 8.5 - 9 mln tonnes.

 

In Q1 2016 the situation on the coal market remained difficult. Average prices of fuel coal dropped by 10.9 per cent as compared to Q1 2015 and prices of coal sold to the commercial power industry - by 11.5 per cent. The oversupply of coal continued on the Polish market together with high level of stock in mines and power plants. Bogdanka coped very well in these very unfavourable conditions due to a flexible response to the market situation and continuation of the cost and capital expenditure optimisation programme.
We are keeping safe financial liquidity. We remain the most efficient and modern bituminous coal mine in Poland. Even though the results for Q1 are satisfactory, we are observing a continuing strong pressure on prices and sales volumes. We can see no grounds to expect any change in the existing market trends in the near future. Therefore, we estimate our annual coal sales on the level of 8.5 - 9 mln tonnes
- said Krzysztof Szlaga, the president of Bogdanka.

More - http://ir.enea.pl/en/pr/316764/enea-group-s-good-financial-results-for-q1-2016-in-summer-the-group-will-present-assumptions-to-a-new-strategy


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czytaj-aktualnosc/2588/lw-bogdanka-group-after-q1-2016-better-financial-results-and-improved-profitability-ratios/ 2016-05-23 00:00:00 2588
LW BOGDANKA S.A. after Q4 2015 and the whole 2015 LW Bogdanka generated in 2015 revenue on sale at a level of almost PLN 1,885 million and EBITDA result of PLN 686 million. This means that despite challenging market situation and results being under the pressure of coal price drops, the Company’s profitability ratio, EBITDA, which last year was 36%, remain at a level higher than the average recorded in the industry. The results generated in 2015 were charged with impairment loss of assets in the amount of PLN -625 million. The impairment charge did not affect the current operating activities of the Company or its liquidity. LW Bogdanka’s net result for 2015, without the impairment charge, was PLN 226 million. Bogdanka performed the commercial coal production plan at a level of approx. 8.5 million tonnes and sales at a level of approx. 8.6 million tonnes.

 

Bearing in mind a very difficult market situation, oversupply of thermal coal and dropping prices, the results - without the impairment loss - should be assessed as good. They were possible to achieve primarily due to consistent pursuance of a plan adjusting the Company’s operations to its selling capacities. The plan included further cost reduction as well as optimisation of capital expenditure and workforce. We confirmed and strengthened our position as a coal mine which is the most efficient and best responding to market conditions, said Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.

 

We invite you to take a look at presentation of the LW Bogdanka Group showing key operating, financial and market data, available on the investor relations website.


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czytaj-aktualnosc/2596/lw-bogdanka-s-a-after-q4-2015-and-the-whole-2015/ 2016-03-22 00:00:00 2596
More than 2.5 million tonnes of coal in 4Q2015 Lubelski Węgiel BOGDANKA S.A., the most advanced and efficient hard coal mine in Poland, produced 2.55 million tonnes of commercial coal in the fourth quarter of 2015, which is comparable to the level achieved in the fourth quarter of 2014 (2.56 million tonnes), which was a record-breaking year in this respect in the Company’s history. The extraction achieved in the fourth quarter of 2015 is in line with this year’s production schedule and much higher than in the previous quarters of 2015.
Thus, the Company completed the commercial coal production plan of approx. 8.5 million tonnes in 2015.


Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:
“We completed the fourth quarter with production at the level of 2.55 million tonnes, making full use of production capacity in this period. As a result, we ended the previous year with coal production at the level of 8.5 million tonnes, thereby fulfilling our promises made in the first half of the year. The full year production level was lower than our current production capacity. According to our assumptions, we adjusted the level of production to sales opportunities in 2015, which was influenced by a difficult market situation.”


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czytaj-aktualnosc/2564/more-than-2-5-million-tonnes-of-coal-in-4q2015/ 2016-01-15 00:00:00 2564
Bogdanka in the 9th edition of the RESPECT Index We are pleased to announce that Lubelski Węgiel Bogdanka S.A. once again has the honour of being among those WSE-listed companies that form the RESPECT Index.

On 16 December 2015, the Warsaw Stock Exchange announced the content of the index of socially responsible companies (RESPECT Index - 9th edition). In this edition, it consisted of 23 companies - the comprehensive list of RI has been published on WSE’s website WSE’s website.
The new composition of the RESPECT Index shall be applicable as of 21 December 2015.

In its portfolio, the stock index includes Polish and foreign companies from the Main Market of the WSE that operate in line with best management standards related to corporate governance, information regime and investor relations, as well as taking into account numerous environmental, social and employment factors. In compliance with the current formula, company audits and revisions of the index list are conducted once a year, in the second half of the year. It lists companies which undergo a three-step verification by the WSE and the Polish Association of Listed Companies, with respect to the areas listed above, as well as an audit conducted by the partner of the project since its first edition - Deloitte.


Congratulations to issuers who have made the ninth edition of the RESPECT Index. The results of this year’s edition only confirm that listed companies, despite demanding economic situation, pay great attention to the issue of responsible business. The proof may be the number of applications and audit results achieved by companies, which are better than a year ago. We also observe an increasing interest in the index among Polish and international investors, which, I hope, will draw other companies’ attention to the issue of corporate social responsibility, said Paweł Tamborski, President of the Management Board of the Warsaw Stock Exchange.

(release prepared on the basis of www.gpw.pl)

 


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czytaj-aktualnosc/2562/bogdanka-in-the-9th-edition-of-the-respect-index/ 2015-12-17 00:00:00 2562
Changes in the composition of the Management Board We hereby inform you that on 23 November 2015, the Company published Current Report No. 47/2015  - Dismissal of the Management Board members of the 8th term of office and appointment of the Management Board for the 9th term of office.

As a result of the changes made, the composition of the Management Board of Lubelski Węgiel BOGDANKA S.A. appointed for the 9th term of office is as follows:

  • Mr Zbigniew Stopa - President of the Management Board;
  • Mr Waldemar Bernaciak - Vice-President of the Management Board, Trade and Logistics;
  • Mr Jakub Stęchły - Vice-President of the Management Board, Procurement and Investments;
  • Mr Piotr Janicki - Vice-President of the Management Board, Economic and Financial Affairs.

For more information visit the Company’s Investor Relations website.


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czytaj-aktualnosc/2559/changes-in-the-composition-of-the-management-board/ 2015-11-23 00:00:00 2559
New Management Board of Bogdanka

The Supervisory Board of LWB has resolved to appoint a new Management Board for a three-year term of office, after removing its previous board. Zbigniew Stopa, the President of the Company, has kept his position, as has Waldemar Bernaciak, who will continue as the Company’s Vice-President, Trade and Logistics. New members on the four-member Management Board are Jakub Stęchły, the Vice-President, Procurement and Investments, and Piotr Janicki, the Vice-President, Economic and Financial Affairs. The Supervisory Board will be chaired by Dalida Gepfert, the Vice-President of Enea.

 

We’ve made the decision to strengthen the Management Board of Bogdanka by taking excellent managers with a proven track record at Enea on board. They have joined a team of top-notch professionals who have been managing Poland’s best mine very well. The expertise and experience of all the members of the new Management Board will help the Group to grow in value”, Dalida Gepfert, the Vice-President at Enea and the Chairperson of the Supervisory Board of Bogdanka, commented.

 

Zbigniew Stopa has a degree from the AGH University of Science and Technology in Krakow. He has worked at Bogdanka since the early days of his career, including many years underground. Since 2012, he has been the President of Bogdanka.

Waldemar Bernaciak a graduate of the AGH University of Science and Technology in Krakow, has worked in the mining industry since the beginning of his career. Since 2008, he has been Bogdanka’s Vice-President, Trade and Logistics.

Jakub Stęchły has degrees from the Silesian University of Technology in Gliwice, Milan Polytechnic and Stanford University. Before joining Bogdanka, he was the President of Enea Serwis and had previously worked in the power engineering industry, among other areas. He has also worked in Italy.

Piotr Janicki is a graduate of the University of Białystok and of Kozminski University. He is a manager with many years of experience in power and heat engineering. Before joining Bogdanka’s team, he was the Vice-President for Economic and Financial Affairs at Enea Wytwarzanie.

 

During today’s, first meeting of the new Supervisory Board, Dalida Gepfert was elected as the Chairperson and Paweł Orlof as Deputy Chairperson. Both are also Vice-Presidents of Enea. The new secretary of Bogdanka’s Supervisory Board is Krzysztof Matan, who is also a representative of Bogdanka’s majority shareholder.

 

In October 2015, Bogdanka became part the Enea Group, which has made Enea a modern fuel and energy group. Enea acquired a controlling stake in Bogdanka following a tender offer for shares in LWB. Enea is a reputable operator in the sale, distribution and production of electricity and heat, while LW Bogdanka is Poland’s most efficient mining company. Enea is also the main customer for Bogdanka’s products, and Bogdanka itself is the largest supplier of fuel for Enea’s key coal-powered electricity production facilities at Kozienice Power Plant. Both companies are listed on the Warsaw Stock Exchange.


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czytaj-aktualnosc/2558/new-management-board-of-bogdanka/ 2015-11-23 00:00:00 2558
Bogdanka - an investor-friendly company We are pleased to announce that LW Bogdanka has joined the ranks of companies honoured by the Individual Investors Association (Stowarzyszenie Inwestorów Indywidualnych) with its 10 out of 10 – An Investor-Friendly Company title.

The10 out of 10 – Communicate Effectively initiative is a scheme developed by the Individual Investors Association under the honorary patronage of an educational campaign called Akcjonariat Obywatelski. Inwestuj świadomie (Civic Shareholding – Invest Consciously), which aims, above all,

  • to develop high standards for listed companies’ market communication with individual investors;
  • to promote companies that follow best practices in communication with individual investors;
  • to encourage companies to follow communication policies that respond to the expectations of individual investors in terms of the form and frequency of action;
  • to encourage active communication with individual investors by promoting best practices in this area;
  • to promote the best practices in communication with individual investors among investors and in the media.

The 10 out of 10 – Communicate Effectively scheme recognises companies that follow communication policies that respond to the expectations of investors in terms of the form and frequency of action.

To be recognised as part of the scheme, LW Bogdanka had to undergo an audit, which confirmed the Company’s compliance with the requirements set out in the rules for the scheme. This, in turn, means that LW Bogdanka adheres to the highest standards in its communication with investors.


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czytaj-aktualnosc/2560/bogdanka-an-investor-friendly-company/ 2015-11-12 00:00:00 2560
LW Bogdanka S.A. in the 3rd quarter of 2015: EBITDA margin maintained at 34.4% despite difficult and unstable market situation The Lubelski Węgiel BOGDANKA Capital Group, headed by LW BOGDANKA S.A.,  generated sales revenue in the 3rd quarter of 2015 of PLN 483.4m. EBITDA for the period was PLN 166.3m, EBIT PLN 73.2m, and net profit more than PLN 56.6m. Despite a difficult market situation and continued downward pressure on coal prices, the company continued to achieve margins above the average for the industry, as exemplified by the EBITDA margin in the 3rd quarter of 2015 of 34.4%.

The results achieved in the 3rd quarter are decidedly improved from the previous quarters of this year. Sales revenue was 16.4% higher than in the 2nd quarter of this year and 12.9% higher than in the 1st quarter. EBITDA rose by 12.9% and 15.2% respectively, and net profit in the 3rd quarter of 2015 was 32.3% higher than in the prior three months and 73.3% higher than in the 1st quarter of 2015.

Sales revenue for the first three quarters of the year was PLN 1.3bn, EBITDA PLN 458.1m, EBIT PLN 174.5m, and net profit PLN 132.1m.

Considering the very difficult market situation, with a continuing oversupply of thermal coal and markedly falling prices since January of this year, the results achieved in the 3rd quarter and year-to-date through the first nine months should be considered good. Achievement of these results was made possible by the company’s flexibility and effective implementation of its program of cost-cutting and optimization of capex.

Thanks to consistent measures in this respect, the company reduced its total cash cost for coal extraction (UMCC + capex/tonne) by 2.6% vs. the 2nd quarter and 10.5% vs. the 1st quarter. For the first three quarters of this year it was 6.3% lower than in the same period of 2014. Costs by nature were cut during the first three quarters of this year by more than PLN 145m compared to the same period of 2014.

The company maintains its coal sales forecast for 2015 at about 8.5m tonnes, which implies a significant increase in extraction and sales in the 4th quarter of this year.

Major changes in the shareholding structure of the company occurred in October. As a result of a tender offer announced on 14 September 2015 by Enea S.A. for sale of shares of LW Bogdanka S.A., on 26 October 2015 Enea S.A. acquired 64.57% of the company’s shares. Together with its subsidiary Enea Wytwarzanie Sp. z o.o. it controls a total of 66% of Bogdanka’s shares.


 

FINANCIAL RESULTS—DETAILS

Selected financial information for the LW Bogdanka Group for the 3rd quarter and the first three quarters of 2015 are presented in the table below:

PLN ’000 3Q 2015 3Q 2014 Change 1–3Q 2015 1–3Q 2014 Change
Revenue 483,424 544,973 -11.3% 1,326,984 1,490,344 -11.0%
Gross profit on sales 74,931 106,857 -29.9% 174,678 241,592 -27.7%
Gross sales margin 15.5% 19.6% -20.9% 13.2% 16.2% -18.5%
EBITDA 166,334 198,216 -16.1% 458,121 502,484 -8.8%
EBITDA margin 34.4% 36.4% -5.5% 34.5% 33.7% 2.4%
Operating profit (EBIT) 73,225 99,950 -26.7% 174,545 226,608 -23.0%
EBIT margin 15.1% 18.3% -17.5% 13.2% 15.2% -13.2%
Net profit 56,639 79,370 -28.6% 132,137 170,794 -22.6%
Net profit margin 11.7% 14.6% -19.9% 10.0% 11.5% -13.0%

 

The main source of revenue for the group is the production and sale of thermal coal. In each of the comparative reporting periods this activity generated over 95% of the group’s sales revenue.

About 95% of coal sales (by value) in the period were made under long-term commercial contracts between LW Bogdanka S.A. and its main customers, i.e. Enea Wytwarzanie Sp. z o.o., GDF Suez Energia Polska S.A., Energa Elektrownie Ostrołęka S.A., PGNiG Termika S.A., Grupa Azoty Zakłady Azotowe Puławy S.A., and EDF Paliwa Sp. z o.o.

Sales in the 3rd quarter of 2015 translated into a 14.7% share for LW Bogdanka S.A. in thermal coal sales on the Polish market (1.9% higher than in the 2nd quarter) and a 24.2% share in sales to the commercial power industry (up 4.8% from the 2nd quarter). This increase in market share was connected with the limiting of sell-off of coal at reduced prices by Kompania Węglowa S.A. and increased sales by the company.

 

SAVINGS PROGRAM

Implementation of strict cost controls enabled the company to cut its costs by nature through the first three quarters of 2015 by more than PLN 145m compared to the same period of 2014.

The main effects of implementation of the program in the LW Bogdanka Group are presented in the table below:

PLN ’000 3Q 2015 3Q 2014 Change 1-3Q 2015 1-3Q 2014 Change
Total costs by nature 418,403 460,141 -9.1% 1,242,945 1,388,146 -10.5%
Total production costs 379,118 414,606 -8.6% 1,125,331 1,210,273 -7.0%
Own cost of production sold 407,382 438,670 -7.1% 1,151,570 1,254,706 -8.2%

 

COAL PRODUCTION

Production of commercial coal in the 3rd quarter of 2015 was 2.04m tonnes, 14.2% less than in the same period of 2014. In the first nine months of the year, 5.9m tonnes of coal was produced, down 10.6% year-on-year. The company sold 2.2m tonnes of coal in the 3rd quarter and somewhat more than 6m tonnes in the first nine months of 2015, down 12.3% and 11.9% respectively year-on-year.

But production was higher in the 3rd quarter than in the 1st and 2nd quarters (when it was 1.99m and 1.90m tonnes respectively). Sales in the 3rd quarter also significantly exceeded sales in the 1st and 2nd quarters (1.95m and 1.88m tonnes respectively).

 

CHANGES IN OWNERSHIP STRUCTURE

As a result of a successful tender offer to acquire shares of LW Bogdanka, the Enea S.A. Capital Group became the controlling shareholder of the company, with 66% of Bogdanka shares. The price proposed in the tender offer by Enea was found by the management board to meet the requirements for minimum price and to reflect the fair market value of the company. A similar opinion was expressed by all of the labour organizations operating at LW Bogdanka.

The management board perceives major synergies in the change in ownership structure which may have a positive impact on the company’s business. The most important of these include:

  • Stabilization of the coal sales market in terms of contracts currently in force with the majority shareholder, as well as the possibility of expanding supplies in the future pursuant to a contract for supply of coal to the new generating unit in Kozienice
  • Increased exploitation of production capacity, and consequently a reduction in costs due to economies of scale
  • Possibility of pursuing a more intensive sales policy thanks to lower extraction costs in the industry
  • Possibility of obtaining better transport prices thanks to joint negotiation of contracts for cooperation with shipping and logistics firms.

Zbigniew Stopa, CEO of Lubelski Węgiel Bogdanka S.A., commented: “For the LW Bogdanka Group the last few months have been a period abounding in events of great importance for the future of the group. I obviously have in mine first and foremost the process of acquisition by Enea of a majority stake in the company’s shares. Meanwhile, business was conducted in a very difficult market situation, which we have been facing practically since the beginning of 2015. Despite market conditions not conducive to conducting a stable business, the company continued to generate profit and maintained an EBITDA margin of nearly 35%, much higher than the average for the global mining industry. We have confirmed and reinforced our position as the most efficient mine in Poland and the most responsive to market conditions. We will do our best to ensure that it stays that way.”


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czytaj-aktualnosc/2554/lw-bogdanka-s-a-in-the-3rd-quarter-of-2015-ebitda-margin-maintained-at-34-4-despite-difficult-and-unstable-market-situation/ 2015-10-29 00:00:00 2554
LW Bogdanka S.A. extracts 2.04 million tonnes of coal in the third quarter and upholds the plan to sell 8.5 million tonnes of coal in 2015 Lubelski Węgiel BOGDANKA S.A., the most advanced and efficient hard coal mine in Poland, produced 2.04 million tonnes of commercial coal in the third quarter of 2015, compared to 2.38 million tonnes achieved in the third quarter of 2014. The level of sales in the third quarter of 2015 totalled 2.19 million tonnes, compared to 2.50 million tonnes in the third quarter of 2014. Cumulatively, production of commercial coal in the first nine months of this year amounted to 5.93 million tonnes, while sales totalled 6.01 million tonnes, compared to 6.63 million tonnes and 6.80 million tonnes in the same period of 2014, respectively. Sale and production levels achieved in the third quarter 2015 were higher than those achieved in the second quarter this year, when the level of production was 1.90 million tonnes and sales amounted to 1.88 million tonnes.

The achieved extraction and sales in third quarter are in line with this year’s customer delivery schedule. The Company upholds the plan to sell 8.50 million tonnes of coal in 2015.
 

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:

"Although we operate in very difficult conditions which are significantly affected not  only by purely market criteria, we are able to maintain a good level of production and the sale of coal. It is worth noting that in the third quarter’s production was higher than the production in the first and second quarter (amounting to 1.99 and 1.90 million tonnes, respectively), while sale in the third quarter significantly exceeded the results of the first and second quarter (amounting to 1.95 and 1.88 million tonnes, respectively). This allows us to maintain our declarations regarding this year’s sales of coal at a level of approx. 8.5 million tonnes."


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czytaj-aktualnosc/2544/lw-bogdanka-s-a-extracts-2-04-million-tonnes-of-coal-in-the-third-quarter-and-upholds-the-plan-to-sell-8-5-million-tonnes-of-coal-in-2015/ 2015-10-06 00:00:00 2544
Enea announces a tender offer for the shares of LW Bogdanka On 14 September 2015 Enea S.A. announced a tender offer for the shares of Lubelski Węgiel Bogdanka S.A.

Full text of the report and the tender offer is available here:
http://investors.enea.pl/en/pr/300949/announcement-of-the-tender-offer-for-the-shares-of-lubelski-wegiel-bogdanka-s-a?changeLocale=en

In accordance with applicable laws, the opinion of the Management Board concerning this tender offer will have been published in a current report by 29 September 2015.
 

STATEMENT BY ZBIGNIEW STOPA, CEO OF  LW BOGDANKA S.A.

The Management Board of LW Bogdanka S.A., together with an advisor employed for this purpose, is currently analyzing the conditions of the tender offer announced by ENEA S.A. The Management Board of LW Bogdanka S.A. will present its position on the announced tender offer within the deadline provided by the Act, with an opinion on the price of shares in the tender offer, prepared by an independent entity (i.e. a fairness opinion).


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czytaj-aktualnosc/2541/enea-announces-a-tender-offer-for-the-shares-of-lw-bogdanka/ 2015-09-21 00:00:00 2541
ENEA Wytwarzanie terminates coal supply agreement with LW Bogdanka S.A. ENEA WYTWARZANIE TERMINATES COAL SUPPLY AGREEMENT WITH LW BOGDANKA S.A.

Zbigniew Stopa, President of the Management Board of LW Bogdanka S.A., comments:

The course of this year’s price negotiations with ENEA was the same as in previous years. In accordance with the long-standing practice, the last round was planned for October. In previous years, an agreement on the prices for the following year was usually reached in the fourth quarter. Therefore, the termination surprised us.

In our opinion, we have always shown great flexibility in negotiating. As a private company, we cannot afford, for obvious reasons, to sell coal below the cost of its production. Therefore, we are unable to accept as a basis for negotiations the prices offered by the coal companies subsidised by the state, which are often significantly lower not only than the production costs of these companies, but even than the production costs of LW Bogdanka, which are the lowest in the Polish market. In a normally functioning market, we are the obvious-choice supplier for power plants in our area due to the high costs of transporting coal.

Given our long-term agreement with ENEA, we are open to resume the talks and seek agreement. We believe that a compromise is possible.

It should be noted that we also have a contract with ENEA for the supply of coal for the new 1,075 MW power unit which is expected to be commissioned in the fourth quarter of 2017. The volume of supply is anticipated at approx. 2 million tonnes of coal per year (compared to the over 3 million tonnes currently supplied to ENEA). I estimate that the two-year notice period of the current agreement will allow us to replace the more than 1 million tonne of lost volume in case we do not come to an agreement.

We have recently expanded, and are continuing to expand, the sales force and are actively looking for new customers, also among smaller companies. We are in talks with customers both in Poland and abroad.

I cannot imagine that the current situation in the Polish market persists much longer, provided that the government’s announcement that Nowa Kompania Węglowa will be profitable from 2017 turns out to be true. With the prices currently offered by KW, it is not possible to carry on a profitable business. There is also no real possibility of reducing the production costs in a single year. The productivity per employee in Bogdanka is three times higher than in KW S.A. and this gap cannot be bridged over a short time and without significant financial outlays.


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czytaj-aktualnosc/2531/enea-wytwarzanie-terminates-coal-supply-agreement-with-lw-bogdanka-s-a-/ 2015-08-24 00:00:00 2531
Bogdanka in the first half of 2015: results under strong pressure from complicated market situation, with reduction in costs and capital expenditures LW BOGDANKA S.A. IN THE FIRST HALF OF 2015:
RESULTS UNDER STRONG PRESSURE FROM COMPLICATED MARKET SITUATION,
WITH REDUCTION IN COSTS AND CAPITAL EXPENDITURES

 

The Lubelski Węgiel BOGDANKA Capital Group, headed by LW BOGDANKA S.A., the most modern and efficient coal mine in Poland, generated sales revenue in the 1st half of 2015 of PLN 843.6m (10.8% less than in the same period of the previous year). EBITDA was PLN 291.8m, EBIT was PLN 101.3m, and net profit was PLN 75.5m. In the 2nd quarter alone, despite consolidated revenue of PLN 415.3m, 10.5% less year-on-year, the LW Bogdanka Capital Group generated results at the level of EBITDA, EBIT and net profit better than those achieved in 2nd quarter of 2014 and in the 1st quarter of 2015, with EBITDA of PLN 147.4m, EBIT PLN 53.2m, and net profit PLN 42.8m.

Considering the very difficult situation on the market, with a continuing oversupply of power coal and clearly falling prices since January, the results achieved in the 2nd quarter and the 1st half of the year should be regarded as good. Achievement of these results was made possible thanks to the flexibility of the initiatives taken by the company (which has used outsourcing for many years), strict cost controls, and optimization of capex.

Production of commercial coal in the 1st half of 2015 was 3.9m tonnes, 8.5% lower than in the first six months of 2014. Sales in the 1st half of 2015 were 3.8m tonnes of coal, down 0.5m tonnes year-on-year. The company flexibly adjusted the scale of production to match the level of sales, as provided in the schedule of shipments to customers, which in turn was affected by the relatively high level of inventories at power plants.

The company assumes coal sales in 2015 of about 8.5m tonnes, while securing production capacity for future years.

The company is continuing measures to adapt its activity to the current level of extraction, for which the sales possibilities on an increasingly difficult market are a key factor. The adjustment program includes optimization of the extraction structure, further reduction in operating costs, and reduction in capital expenditures. Realization of this program in the 1st half of 2015 generated savings in costs by nature of 11.1% compared to the same period of 2014, total production costs by 6.2%, and own costs of sold production by 8.8%. Meanwhile, the company cut its capex plan for the current year by PLN 199.4m (a reduction by a further PLN 80m as against the assumptions from June 2015).

Alongside these measures, work continues to win new customers. The company has reinforced its sales team and is working on winning contracts with small and medium-sized customers. Commercial negotiations are continuing in Ukraine.


 

FINANCIAL RESULTS—DETAILS

Selected financial information for the LW BOGDANKA Group in the 1st half of 2015 is presented in the table below:

 

PLN ’000 Q2 2015 Q2 2014 Change H1 2015 H1 2014 Change
Revenue 415 281 463 831 -10,5% 843 560 945 371 -10,8%
Gross profit on sale 53 293 49 630 7,4% 99 747 134 735 -26,0%
Gross sales margin 12,8% 10,7% 19,6% 11,8% 14,3% -17,5%
EBITDA 147 392 130 119 13,3% 291 787 304 268 -4,1%
EBITDA margin 35,5% 28,1% 26,3% 34,6% 32,2% 7,5%
Operating profit (EBIT) 53 168 40 700 30,6% 101 320 126 658 -20,0%
EBIT margin 12,8% 8,8% 45,5% 12,0% 13,4% -10,4%
Net profit 42 808 28 824 48,5% 75 498 91 424 -17,4%
Net profit margin 10,3% 6,2% 66,1% 8,9% 9,7% -8,2%

 

The main source of revenue for the group is the production and sale of power coal. In each of the comparative reporting periods this activity generated over 95% of the group’s sales revenue.

About 95% of coal sales (by value) in the period were made under long-term commercial contracts between LW BOGDANKA S.A. and its main customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia Polska S.A., ENERGA Elektrownie Ostrołęka S.A., PGNiG Termika S.A., Grupa Azoty Zakłady Azotowe Puławy S.A. and EDF Paliwa Sp. z o.o.

Sales in H1 2015 translated into a 13.5% share for LW BOGDANKA S.A. in power coal sales on the Polish market and a 20.1% share in sales to the commercial power industry (as against 16.6% and 24.9% respectively at the end of 2014). The decline in market share was connected with the sell-off of coal at reduced prices by Kompania Węglowa S.A.

The better results y/y in H1 2015 were influenced not only by outsourcing, strict cost controls and capex optimization, but also by the improved mining yield, which was 67.6%, as against 66.1% in H1 2014. In the 2nd quarter alone mining yield was 68.3%, compared to 65.2% in Q2 2014.


 

CONSISTENT IMPLEMENTATION OF SAVINGS PROGRAM

With forecasts calling for further pressure on global coal prices and an oversupply on the Polish market, the company set a fundamental goal for 2015 of securing cash through significant savings in costs and investment plan.

As part of the optimization of its operations, the company took the following measures in the 1st half of 2015:

  • Reduced preparation work to 10.2 km of workings in 1H 2015, compared to 16.4 km in 1H 2014, based on a production plan for about 8.5m tonnes. Meanwhile, production capacity was maintained for future years.
  • A decline in headcount by 210 was achieved through 30 June 2015, and 300 as of the end of July 2015 (4,630 employees vs. 4,930 at the beginning of the year).
  • The investment plan for 2015 was cut further, to PLN 361m, i.e. PLN 80m below the assumptions from June 2015 and PLN 200m less than the original plan.

If the negative market situation continues, the company plans to implement the 2nd phase of the restructuring program, which calls for continuing of optimization and savings measures, concentrating on the elements listed above.

 

Zbigniew Stopa, CEO of LW BOGDANKA S.A., commented: “The operations of LW BOGDANKA S.A. and its financial results have been influenced by the difficult situation on the coal market, which made it necessary to adjust our production to fit the sales capabilities on the market. Unfortunately, the risk involving reduction in volumes covered by contracts with entities controlled by the Polish Treasury materialized. This fact, combined with the continuing oversupply of power coal, the high levels of coal inventories at major customers, and strong pressure to reduce prices forced us to revise our sales plans downward, and consequently our production plans as well. As a result of this, there was another significant reduction in the capital expenditures planned for 2015. We cannot count on state aid, which our competitors in Silesia generously benefit from. We compete through efficiency guided by economic calculations. This also dictates the optimization and savings measures undertaken by us in the complicated market situation, thanks to which we can regard the results achieved in the 2nd quarter and the 1st half of this year as good. I believe that this is one reason investors value our company.”


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czytaj-aktualnosc/2522/bogdanka-in-the-first-half-of-2015-results-under-strong-pressure-from-complicated-market-situation-with-reduction-in-costs-and-capital-expenditures/ 2015-08-20 00:00:00 2522
LW Bogdanka S.A. extracts 1.90 million tonnes of coal in the second quarter and upholds the plan to sell 8.5 million tonnes of coal in 2015 Lubelski Węgiel BOGDANKA S.A. produced 1.90 million tonnes of commercial coal in the second quarter of 2015, compared to 1.99 million tonnes achieved in the first quarter of 2015, and 2.02 million tonnes in the second quarter of 2014. The level of sales in the second quarter of 2015 totalled 1.88 million tonnes, as compared to 1.95 million tonnes in the first quarter of 2015 and 2.10 million tonnes in the second quarter of 2014. Cumulatively, production of commercial coal in the first half of the year amounted to 3.89 million tonnes, while sales totalled 3.82 million tonnes, as compared to 4.25 million tonnes and 4.33 million tonnes in the same period of 2014, respectively. Lower extraction and sales of coal is connected with continued market difficulties and oversupply of coal on the Polish market.

The achieved extraction and sales are in line with this year’s customer delivery schedule. The Company upholds the plan to sell 8.50 million tonnes of coal in 2015.

The Company is currently focused on attracting new customers and adjusting its operations to the existing extraction level (which correlates with sales opportunities) by optimising the structure and level of extraction, reducing the costs of operations and limiting investment expenditure.
 

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:
“The production and sales in the second quarter were consistent with the assumptions and schedules of deliveries to customers. We uphold our declarations concerning the sales of 8.50 million tonnes of coal this year. This means that both the production and sales in the second half of the year will be significantly higher than during the first six months. At the moment, our priority is to attract new customers, adjust our operations and extraction to current sales opportunities by optimising the structure and level of extraction, and further reducing the costs of production and investment expenditure. Our objective is to maintain unit costs on the existing level irrespective of the decline in volumes.”


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czytaj-aktualnosc/2519/lw-bogdanka-s-a-extracts-1-90-million-tonnes-of-coal-in-the-second-quarter-and-upholds-the-plan-to-sell-8-5-million-tonnes-of-coal-in-2015/ 2015-07-07 00:00:00 2519
Statement by Zbigniew Stopa, CEO of LW Bogdanka S.A. about the dividend STATEMENT BY ZBIGNIEW STOPA, CEO OF  LW BOGDANKA S.A.

The situation on the Polish coal market continues to worsen. This is connected with a continuing oversupply of coal and the aggressive price policy of the government-subsidized Kompania Węglowa. A consequence of these factors is the threat of a reduction in the volume of sales to Bogdanka’s customers in 2015 and perhaps over a longer perspective. At this time we estimate our sales capacity for this year at 8.5 million tonnes, which is much less than our production capacity.

This situation forces us to cut production further and, along with that, to seek savings in every aspect of our operations, to be prepared not only for further continuation of the current difficult market situation but even for worsening of the situation if events unfold negatively.

We are conducting intensive sales initiatives to obtain additional coal customers. We are also implementing a series of restructuring measures to reduce costs. These include further reduction in the level of capital expenditures (to the minimum necessary to maintain the continuity of the company’s business), reduction of the permanent headcount and outsourcing services, limiting working time to 5 days per week, organizational changes, and further reduction in other operating costs.

Meanwhile, we have decided to propose to our shareholders that 37.5% of the net profit from 2014 be earmarked for “reserve capital, to be used for payment of a dividend,” instead of immediately earmarking this amount for a dividend. In our view, this will maintain the necessary level of cash in the company to ensure financial stability and reliability. At the same time, in the event of positive changes in the market situation and the appropriate level of contracting by the company for upcoming years, this solution will enable payment of an advance dividend for financial year 2015 during this year (reflecting funds from reserve capital).

I believe that our shareholders will understand the reasons and the necessity for the management board’s issuance of this recommendation. We want to continue to be a dividend-paying company, but—as demonstrated by the situation at the Silesian mines—in the current market situation the company’s liquidity and financial stability should be treated as an absolute priority.


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czytaj-aktualnosc/2516/statement-by-zbigniew-stopa-ceo-of-lw-bogdanka-s-a-about-the-dividend/ 2015-06-11 00:00:00 2516
Bogdanka insists that the President of the Office of Competition and Consumer Protection initiated proceedings related to the application of prohibited business practices by Kompania Węglowa LW BOGDANKA S.A. moved to the President of the Office of Competition and Consumer Protection for the initiation of proceedings related to the Kompania Węglowa S.A.’s application of prohibited business practices limiting competition.

In the opinion of the Company, the activity of Kompania Węglowa S.A., involving the sale of coal below costs of extraction, violates the regulations related to competition protection, as well as can be qualified as acts of unfair competition.

 

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:
“Operations conducted by Kompania Węglowa S.A. are aimed directly at LW Bogdanka S.A.’s customers who, as it results from, among other factors, data presented by the Industrial Development Agency, are offered significantly lower prices than other customers of Kompania Węglowa S.A. The difference is neither related with the coal quality, nor with other contractual terms and conditions of supplies. In our opinion, these activities are aimed at excluding or limiting the operations of LW Bogdanka S.A. on the market. The situation forced us to limit our production which results e.g. in the necessity to reduce employment - despite the fact that we are the most cost-effective mine in Poland. The current situation on the coal market, devastating for players operating in compliance with market conditions, may have disastrous consequences for the entire industry. This is why we moved to the President of the Office of Competition and Consumer Protection to initiate proceedings related to prohibited practice that limit competition used, according to us, by Kompania Węglowa S.A.”
“It is worth mentioning that the sale of coal below the costs of production conducted by Kompania Węglowa S.A. is possible only due to the fact that the company waits for the ‘subsidy to coal prices’ which should be thus treated as state aid. Also the deferral of tax arrears or outstanding social security (ZUS) contributions is considered the state aid, as well as other forms of unsanctioned aid from the state, unless such aid does not meet specified criteria. The support provided to Kompania Węglowa S.A. would have to be considered acceptable by the European Commission, however according to us – from the point of view of the EU regulations – it is difficult to find justification to such conclusion,”
added Zbigniew Stopa.


Both Kompania Węglowa S.A. and LW Bogdanka sell a significant majority of their produced fine coal on the Polish market. In the case of fine coal, import and export are of minor significance. In 2014, the import of fine coal amounted to approx. 4.5 million tonnes, whereas export – to approx. 5.8 million tonnes. It is related to the high share of transportation costs as compared to the price of fine coal – they exceed 30% of price in rail transport on distances longer than 500 km (deliveries to Port Północny, Gdańsk, in order to perform export by sea or deliveries by rail to other European markets e.g. to Germany), as well as to high norms of calorific value on the international market (net calorific value of fine coal on international markets exceeds 25 GJ/Mg).

Moreover, there is no substitutability between fine coal and other types of coal which is due to technological issues, in particular burning parameters of boilers in the commercial power industry, being the recipient of fine coal, which prevent the direct use of other types of coal (medium, fine and lump types of coal are of minor significance to the commercial power industry and require expensive processing to the form of fine coal). Also differences in the prices of fine coal and other types of coal, exceeding 40% in 2013-2014, are decisive in the case of lack of substitutability.

As a consequence, one should assume that the relevant market, both in terms of geography and product, to be considered in the analysis by the Office of Competition and Consumer Protection, is the Polish market of fine coals, on which Kompania Węglowa is the leader. According to LW Bogdanka S.A., it means that activity conducted by Kompania Węglowa S.A. violates Article 9 of the Competition and Consumer Protection Act of 16 February 2007.


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czytaj-aktualnosc/2514/bogdanka-insists-that-the-president-of-the-office-of-competition-and-consumer-protection-initiated-proceedings-related-to-the-application-of-prohibited-business-practices-by-kompania-weglowa/ 2015-06-08 00:00:00 2514
LW Bogdanka Publishes Integrated Report for 2014 In the end of May 2015, at the WallStreet Conference in w Karpacz, LW Bogdanka S.A. presented its Integrated Report for 2014, the first one developed as a marketing document.

LW Bogdanka has been preparing and publishing its marketing annual reports in the financial area for several years. It has also prepared two annual non-financial reports so far.  This year’s publication is a second report prepared by LW Bogdanka in accordance with the Global Reporting Initiative (GRI) guidelines. The key difference versus the previous report, published last year, is that the current publication is no longer limited to non-financial reporting, but it constitutes an integrated report, combining both financial and non-financial performance. As the previous report, the current report is prepared ‘in accordance’ with GRI G4 in ‘core’ option, but, in addition, using the International Integrated Reporting (“IR”) Framework. The report also presents indicators specific for the mining sector, which are described in the relevant sector supplement. It is worth noting here that the previous report received two awards in the end of 2014 – in the Social Reports 2014 contest organised by the Responsible Business Forum, PwC and SGS Polska. The experts considered it the best debut among social responsibility reports in 2014 and, in addition, it was awarded by the Ministry of Economy for the demonstration of understanding of the CSR concept in particular initiatives in the mining sector, for the lucid presentation of the reporting entity’s role in supply chain and for the valuable descriptions of management of innovation and environmental aspects.

The reliability of the report and its compliance with the Guidelines was monitored by a third party expert who supported its preparation, however the report was not submitted to external verification.
The Report covers the entire LW Bogdanka group of companies as it is consolidated for financial reporting purposes. So it includes the parent company, i.e. LW Bogdanka S.A., its subsidiary Łęczyńska Energetyka Sp. z o.o., and three smaller companies (RG Bogdanka sp. z o.o., Eko Trans sp. z o.o. and MR Bogdanka sp. z o.o.), of which one (MR Bogdanka) was established in 2014. As those three smaller companies exert rather an insignificant impact on the financial, social and environmental situation of the Group, their description in the report is narrowed to certain aspects. Nonetheless, this approach follows the concept of the GRI Guidelines, which recommend that only material aspects should be reported.
 

We hope you will enjoy our Integrated Report for 2014 which you may download here


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czytaj-aktualnosc/2512/lw-bogdanka-publishes-integrated-report-for-2014/ 2015-06-02 00:00:00 2512
Bogdanka after Q1 2015: results affected by market situation, cost optimisation and investment programme underway LW BOGDANKA S.A. AFTER Q1 2015: RESULTS AFFECTED BY MARKET SITUATION, COST OPTIMISATION AND INVESTMENT PROGRAMME UNDERWAY

MANAGEMENT RECOMMENDS 37.5% OF CONSOLIDATED NET PROFIT BE USED FOR DIVIDEND PAYMENTS

 

The Lubelski Węgiel BOGDANKA Group, with its parent  company, Lubelski Węgiel BOGDANKA S.A., recorded a Q1 2015 revenue figure of PLN 428.3 million (down by 11.1% compared to the same period of last year). EBITDA amounted to PLN 144.4 million, EBIT reached PLN 48.2 million and net profit was PLN 32.7 million. The results, while making the Company stand out positively in its industry, are lower than the figures for the same period of last year, which is a result of revising the Company’s production plans to reflect the present coal selling situation on the market.

Commercial coal production in the first quarter of 2015 amounted to 1.99 million tonnes, which means that it was lower by 11.1% than in the first quarter of 2014 (2.24 million tonnes). The achieved coal production (extraction) is in line with this year’s customer delivery schedule, affected by the mild winter and large stocks of coal in storage yards. Q1 2015 sales of coal arrived at 1.95 million tonnes, compared to 2.23 million tonnes a year before. Despite the falling prices in the coal market, the Company managed to keep its Q1 coal price per tonne similar to the average price for 2014, by selling coal with a higher calorific value.

The Company confirms its coal sales forecast at 9.3 to 9.5 million tonnes for all of 2015.

The Company continues its efforts to revise its business operations to reflect its present coal production levels (which depend on the Company’s ability to sell its coal) by optimising its coal production structure, continuing to cut its running costs and reducing its capital expenditure.
As a result of the efforts, the Company reduced its costs by type for Q1 2015 by 9.7% against the figure for the same period of 2014. Also, the Company reduced its capital expenditure for 2015 by PLN 77.6 million.

Following an analysis of the market situation and Company’s situation, the Management Board has decided to recommend that 37.5% of the Group’s consolidated net profit for 2014, i.e. PLN 102 million, be used for dividend payments. This means a dividend of PLN 3.00 per share and a dividend rate of 3.5%. The Management Board believes that the recommended dividend level will enable the Company to keep enough cash in its pocket to secure its financial stability and credibility.  

The Company continues work to revise its strategy to reflect the market conditions as they are today and anticipated for the years to come. The revised strategy will be published by the end of June this year.

 

FINANCIAL RESULTS – DETAILS

Selected financial figures of the LW BOGDANKA Group after the first quarter of 2015 are presented in the table below:

PLN’000 Q1 2015 Q1 2014 Change 
Sales revenue 428 279 481 540 -11,1%
Profit on sales 46 454 85 105 -45,4%
Gross margin on sales 10,8% 17,7% -39,0%
EBITDA 144 395 174 149 -17,1%
EBITDA margin 33,7% 36,2% -6,9%
Operating profit (EBIT) 48 152 85 958 -44,0%
EBIT margin 11,2% 17,9% -37,4%
Net profit for the financial year 32 690 62 600 -47,8%
Net margin 7,6% 13,0% -41,5%

        

In the first quarter of 2015, LW BOGDANKA’s revenue reached PLN 428.3 million, which was a decrease of 11.1% compared to the same period a year before.

Approximately 95% of coal sales in the reporting period (in terms of value) was achieved under long-term sales agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia S.A., ENERGA Elektrownia Ostrołęka S.A., PGNiG Termika S.A., Zakłady Azotowe Puławy S.A., and EDF Paliwa Sp. z o.o.  

The financial results for Q1 2015 were affected by the prevailing market situation and the resulting need for the Company to revise its coal production levels to reflect its ability to sell its coal.

The Company continues measures to reduce its running costs. As a result, its costs by type in Q1 2015 were down by 9.7% compared to the same period a year before. Not adjusted for depreciation and amortisation, the Company reduced its costs by type by as much as 13.6%, with gross production (coal extraction) down by 11% and preparation work down by 44.1%.   

 

PRODUCTION AND SALE OF COAL

Commercial coal production in the first quarter of 2015 amounted to 1.99 million tonnes, which means it was lower by 11.1% than in the first quarter of 2014 (2.24 million tonnes). The achieved coal production (extraction) is in line with this year’s customer delivery schedule, affected by the mild winter and large stocks of coal in storage yards.

The coal yield figure for Q1 2015 was 66.6%, which was similar to the level for the same period of last year (66.9%).

Q1 2015 sales of coal arrived at 1.95 million tonnes, compared to 2.23 million tonnes a year before. Despite the falling prices in the coal market, the Company managed to keep its Q1 coal price per tonne similar to the average price for 2014, by selling coal with a higher calorific value.

Having to revise its coal production levels to reflect its ability to sell the coal it produces, the Company decided to make fewer new drifts or galleries. As a result, the total length of new drifts and galleries made in the first quarter of 2015 was 5.2 km, compared to 9.3 km in the first quarter of 2014 (down by 44.1%). The reduction in preparation work will affect the length of new workings made in 2015, by 5.1 km compared to 2014. As a result, the Company will make a total of 24.7 km of workings, instead of the planned 31.3 km.

The Company’s coal stocks of 350 thousand tonnes as at the end of March 2015 (up by 52.8% from the end of March 2014 and by 14.4% from the end of December 2014) were equivalent to approx. 11 days of the Company’s production and were in line with the customer delivery schedule.

 

THE STRATEGY

Following a significant change of the market situation, affected by factors such as a considerable decline in coal prices, large stocks of coal in the storage yards of Silesia’s mines and power plants, as well as the government’s plans to respond to the situation faced by the mining and power engineering industries, the Company’s Management Board has decided to revise the objectives in the Company’s strategy for 2015-2010. Work on the new strategy is underway, and the revised version will be published by the end of June 2015.

Main objectives in the Strategy:

  • to keep LW BOGDANKA’s position as the leader in terms of cost efficiency – creating conditions for keeping its low coal production costs in the long term, by optimising the coal production structure and levels and continuing to reduce the Company’s running costs;
  • to sell coal for use in power production, heat production and the chemical industry, by expanding the Company’s customer base and branching out into new, attractive market segments;
  • to expand the Company’s operations in the Polish market – continuing to keep track of new investment programmes and projects in the region;
  • to expand the Company’s operations into international markets.

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Strategic goals:

  • Pto prepare the Company to operate in the dramatically changing market situation affected by external factors and growing competition;
  • to make the conceptual, organisational and investment efforts needed to find new resources that would enable the Company to continue its operations far beyond the period covered by the strategy;
  • to continue implementing the Company’s cost optimisation programme (covering production as well as personnel costs) in the mid-term and to optimise the Company’s capital expenditure;
  • to keep LW BOGDANKA’s position as the leading hard coal producer in Poland, by increasing its share in the market for fine grade power coal to 30% and increasing its sales to medium-sized and small customers;
  • to ensure a return on the capital employed by the Company’s investors.

 

In order to enable the Company to operate in the changing market, the Company has analysed various alternative scenarios for its operation and development based on the possible changes in Poland’s coal market.

The optimal scenario involves:

  • continuing to extract coal from the Bogdanka and Stefanów fields and making new areas of the Ostrów-Orzechów field and, in the long term, the K6-K7 area, accessible for coal extraction, using the mine’s existing infrastructure (without building new shafts and/or increasing production levels);
  • limiting the Company’s development expenditure to what is required for access to new deposits, especially in 2015-2017, and reviewing the Company’s capital expenditure on increasing the mine’s production capacity by 2020;
  • revising the Company’s production levels to reflect the market situation,  especially in 2015-2017, while increasing production from thicker coal seams (using the cutter-loader technology);
  • optimising the long-term return on the capital employed by the Company’s investors, taking into account the risks related to the market situation.

 

The scenario adopted by the Management Board is believed to be the most flexible and will allow the Company to restore its plans to increase its production levels or even to expand its production capacity.

At present, the Management Board is in the process of carrying out a multi-option analysis of the Company’s operation, taking into account the possible developments in the coal market (demand and prices) by 2020. The Company will use the analysis to revise the Strategy.

As part of its work to revise the Strategy and having to change its capital expenditure plans to reflect the present market situation and the Company’s ability to sell its coal, the Management Board revised the Company’s capital expenditure plan for 2015. As a result, the Company’s capex figure for 2015 has been reduced by PLN 77.6 million to PLN 503.1 million. The Company’s capex expenditure in the first quarter amounted to PLN 82.5 million.

In accordance with its cost-cutting plan, the Company is working to reduce its staff levels to what is required given the Company’s planned coal production levels. In 2015, the Company expects to reduce its staff levels by 145 people by the middle of the year and 350 people by the end of the year. The reduction in staff levels will involve certain employees taking retirement (the employees eligible for retirement) and not renewing the Company’s fixed-term employment contracts. As part of the cost-cutting plan, in 2015 the Company will also reduce the use of third-party services, including on an outsourcing basis, and revise its preparation work to reflect the planned coal production levels.

At the same time, the Management Board is reviewing its dividend policy for the years to come, taking into account both local and global trends and price conditions. It is a key priority for the Company to secure its financial liquidity and stability. The dividend policy for the years to come will be adopted and announced by 30 June 2015, together with the revised business strategy for 2015-2020.

 

“The first quarter of the year was affected by the difficult situation in the coal market, which made us have to revise our production plans to reflect our ability to sell our coal on the market. Apart from the large stocks of coal in the storage yards (7.5 million tonnes at the end of 2014 and 8.5 million tonnes at the end of February), the mild winter has also resulted in movements in our customer delivery schedules. We can confirm our sales forecast for 2015 at 9.3 to 9.5 million tonnes of coal. We expect to use our full production capacity in the second half of the year, which means that our production levels may be similar to those we achieved in the fourth quarter of last year. Our priorities today are to optimise our production structure and levels and to continue reducing our running costs and capital expenditure so that the company is able to operate in the present and anticipated difficult market conditions – since January 2013, the prices of fine power coal grades for commercial power plants have fallen by over 20%”, said Zbigniew Stopa, president of the Management Board of LW BOGDANKA S.A.

“Following an analysis of the market situation and Company’s situation, the Management Board has decided to recommend that 37.5% of the Group’s consolidated net profit for 2014 be used for dividend payments, which is less than what has been planned in the strategy we are revising now. We believe that the recommended dividend level will enable the Company to keep enough cash in its pocket – it is the Company’s priority to secure its financial stability and credibility”, Zbigniew Stopa added.


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czytaj-aktualnosc/2506/bogdanka-after-q1-2015-results-affected-by-market-situation-cost-optimisation-and-investment-programme-underway/ 2015-04-30 00:00:00 2506
Bogdanka after first quarter of 2015 LW BOGDANKA extracts 1.99 million tonnes of coal in the first quarter and upholds the plan to sell  9.3-9.5 million tonnes of coal in 2015

 

Lubelski Węgiel BOGDANKA S.A., the most advanced and effective hard coal mine in Poland and the leader in the domestic market for power coal producers, extracted 1.99 million tonnes of commercial coal in the first quarter of 2015, compared to 2.24 million tonnes achieved in the same period last year.Sales in the first quarter of 2015 amounted to 1.95 million tonnes, compared to 2.23 million tonnes in the previous year. Lower extraction and sales are related to the current difficult market situation and an oversupply of coal on the Polish market.

The achieved extraction is in line with this year’s customer delivery schedule.The Company upholds the plan to sell 9.3-9.5 million tonnes of coal in 2015.

The Company focuses now on adjusting its operations to the extraction level (conditional upon sales possibilities) by optimising the structure and level of extraction, as well as further reduction of costs and investment outlays.

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:

“In 2014, we finalised our multi-annual investment programme aimed at doubling the production capacity. Following the launch of the Mechanical Coal Processing Plant our capacity amount to 10.5-11.5 million tonnes. Unfortunately, the current difficult market situation forced us to verify our plans for 2015. The previous quarter was the first period when the impact of the current market situation was reflected in Bogdanka’s operations – for the first time in many years, our production did not depend on our production capacity but on the possibility to place coal on the market.

We uphold our declarations concerning the sales of 9.3-9.5 million tonnes of coal this year.We continue works to update the strategy that is aimed at preparing the Company for operation on the drastically changing, due to external factors, and more and more competitive market.At the moment, our priority is to adjust our operations and the extraction to current sales possibilities by optimising the structure and level of extraction, as well as by further reduction of costs and investment outlays.The long-term goal of the conducted activities is to create conditions for keeping down extraction costs in a longer perspective. We have also been conducting activity aimed at broadening the spectrum of the Company’s customers.”


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czytaj-aktualnosc/2504/bogdanka-after-first-quarter-of-2015/ 2015-04-10 00:00:00 2504
LW Bogdanka Gruop after FY 2014: implementation of strategic objectives and solid results despite difficult market conditions REVIEW OF THE STRATEGY FOR THE COMING YEARS DUE TO THE CURRENT DIFFICULT MARKET SITUATION

The Lubelski Węgiel BOGDANKA Group whose parent is LW BOGDANKA S.A., the most advanced and efficient coal mine in Poland and the national market leader in power coal production, despite challenging market conditions, achieved solid financial results in 2014. Sales revenue during this period exceeded PLN 2 billion, which was higher by 6.0% than the results achieved in the same period a year earlier. EBITDA amounted to nearly PLN 750 million, EBIT reached PLN 362.3 million, and net profit PLN 272.4 million. In the fourth quarter of 2014 alone, the revenue exceeded PLN 523 million, EBITDA amounted to PLN 247.5 million, EBIT - PLN 135.7 million, and net profit reached PLN 101.6 million. The Company continues efforts to further increase the efficiency — as a result the unit cash extraction cost fell by 12%, in real terms, in relation to 2012.

In the fourth quarter, the commercial coal production reached 2.6 million tonnes, which is a record in the Company's history and an increase of 21.5% over the fourth quarter of 2013 (2.1 million tonnes). As a result, commercial coal production in 2014 reached 9.2 million tonnes, which represents an increase of 10.1% compared to the same period of the previous year. The new Mechanical Coal Processing Plant commissioned in September 2014 contributed primarily to the increase in net production which doubled the nominal yield on the "wet" line and it currently reaches 2,400 tonnes/h.

The sales of commercial coal in the fourth quarter reached 2.3 million tonnes, which constitutes an increase of 13.5% compared to the fourth quarter of 2013. Throughout 2014 the sales reached the level of 9.2 million tonnes, which was about 12.5% higher than that recorded in the same period a year earlier. The achieved mining and sales levels translate into the Company's strong market position. At the end of 2014, the market share of LW BOGDANKA amounted to 16.6% for power coal market in Poland (compared to 14.8% at the end of 2013), and nearly 25% for power coal sold to commercial power industry (compared to 19.3% at the end of 2013).

In view of the current difficult situation on the coal market, the Company's Management Board decided to review the strategy, so as to adapt it to current and expected market conditions in the coming years.

Production assumptions for 2015 also take into account the current market situation and provide for the sale of coal at the level of 9.3-9.5 million tonnes.

 

FINANCIAL RESULTS – DETAILS

The following table presents the selected financial information of the LW BOGDANKA Group after the fourth quarter and cumulatively throughout 2014:

'000 PLN Q4  2014 Q4 2013 Change Q1-Q4 2014 Q1-Q4 2013 Change
Revenue    523 224 481 531 8,7% 2 013 568 1 899 830 6,0%
Profit on sales 137 983 125 169 10,2% 379 575 455 799 -16,7%
Gross profit on sales 26,4% 26,0% 1,5% 18,9% 24,0% -21,3%
EBITDA 247 469 206 600 19,8% 749 953 754 941 -0,7%
EBITDA margin 47,3% 42,9% 10,3% 37,2% 39,7% -6,3%
Operating profit (EBIT) 135 707 117 244 15,7% 362 315 424 803 -14,7%
EBIT margin 25,9% 24,3% 6,6% 18,0% 22,4% -19,6%
Net profit for fiscal year 101 558 104 995 -3,3% 272 352 329 728 -17,4%
Net profitability 19,4% 21,80% -11,0% 13,5% 17,4% -22,4%

        

In 2014 LW BOGDANKA generated revenue in excess of PLN 2 billion, which is 6.0% higher than in the same period a year earlier.

Approximately 92% of coal sales (in value terms) in the analysed period were carried out on the basis of long-term trade agreements concluded between LW Bogdanka S.A. and its main customers, i.e. Elektrownia Kozienice Grupa ENEA S.A., GDF Suez Energia Polska S.A., ENERGA Elektrownia Ostrołęka S.A., PGNiG Termika S.A.

2014 was a difficult period for the industry due to the decline in demand for coal and a large inventory of power coal in Silesian power plants and mines. As a result, the Company's profit margins throughout the year remained under pressure of falling coal prices to commercial power industry (which at the end of January 2015 were lower by 17.5% than the prices at the beginning of 2013).

The results in 2014 were also affected by the generated yield, which was 66.6% (compared to 68.5% in 2013). This was related to difficult geological mining conditions persistent in the second and third quarters of 2014.

The high profit margins achieved in the fourth quarter of 2014 should also be emphasized, which was related to a record high level of mining in this period and the improvement in yield in December 2014. In the fourth quarter yield was 66.7%, compared to 66.4% in the same period a year earlier.

The Company applies strict cost control. In the fourth quarter of 2014 the expenditure increased only by 8.8%, while net production was higher by 21.5% compared to the fourth quarter of 2013. These measures translate into maintaining by the Company above-average (for the sector) financial ratios (despite the difficult market situation), as exemplified by EBITDA margin reaching 47.3% in the fourth quarter of 2014 and 37.2% cumulatively for the whole year. At the same time, in 2014 the Company achieved a real decrease in unit cash extraction cost by 12.0% compared to 2012, despite the difficult geological conditions in Stefanów in the second and third quarters of 2014.

 

COAL PRODUCTION AND SALES

In the fourth quarter commercial coal production reached 2.56 million tonnes, which is a record in the history of the Company, and an increase of 21.5% over the fourth quarter of 2013. As a result, commercial coal production throughout 2014 reached 9.2 million tonnes, which represents an increase of 10.1% compared to the same period a year earlier (8.4 million tonnes).

The new Mechanical Coal Processing Plant commissioned in September 2014 contributed primarily to an increase in net production, which doubled the nominal yield on the "wet" line and it currently reaches 2,400 tonnes/h. This increase was also due to mining an average on 4.4 walls (4 — by roadheader, 2 — by plough) and since November 2014 mining on the wall 3/VI/385 in the Nadrybie Field — good geological conditions made it possible to improve the yield in December 2014 and achieve the highest level of 73% throughout the year.

The sales of commercial coal in the fourth quarter reached 2.3 million tonnes, which constitutes an increase of 13.5% compared to the fourth quarter of 2013. Throughout 2014 the sales have reached the level of 9.2 million tonnes, which was about 12.5% higher than those recorded in the same period a year earlier.

Work is continuously performed to open up new coal seams. 29.8 km galleries were completed in 2014 compared to 28.6 km in the previous year, which represents an increase of 4.2%. 5.7 km of galleries were completed in in the fourth quarter of 2014 (compared to 7.4 km in the same period of 2013).

Inventories of coal at the level of 306,000 tonnes at the end of December 2014 (41.7% higher than those recorded at the end of December 2013) corresponded to approximately 10-day production and were in line with the schedule of deliveries to customers.


LICENCES

In 2014, the Company received licenses for prospecting of deposits in the Ostrów and Orzechów areas and mining licence for in the K-3 area (19 million tonnes of operative reserves).

The Company is pursuing its efforts to obtain a mining licence in the K6-K7 area — on 12 December 2014 a complaint was filed was with the Provincial Administrative Court in Warsaw against the decision of the Minister of the Environment on the refusal to grant a licence.

At the same time works began with a view to converting the prospecting licence to a mining licence for the Ostrów and Orzechów deposits and additional development of about 400 million tonnes of operative reserves. These deposits are the most promising due to the amount of resources and the possibility to quickly start mining of these deposits using the existing surface and pit infrastructure of the Bogdanka and Nadrybie Fields.

 

STRATEGY

In connection with the substantial change of the market situation, resulting from such factors as a significant decrease in the price of coal, coal stockpiles at Silesian mines and at power plants and plans for the government's intervention in mining and power production, the Company's Management Board decided to review the Strategy for 2015–202.

Main assumptions of the Strategy:

  • Maintaining LW Bogdanka S.A.'s position of a cost leader — creating the conditions for keeping down mining costs in the long term by optimising the structure and level of mining and further reducing operational costs;
  • Selling coal to the power industry, heating and chemical sectors — by widening the audience of coal buyers and entering new and attractive market segments;
  • Expanding on the Polish market — continuously monitoring new investment schemes and projects in the region;
  • Getting a foothold in the foreign market.

Strategic objectives:

  • Carry out the conceptual, organizational and investment projects related to the acquisition of new resources to ensure the Company's operations well beyond the period covered by the plan;
  • Maintain the leading position among domestic coal producers by obtaining 30% share in the fine power coal market — increase sales to medium and small customers;
  • Prepare the Company to operate in volatile conditions affected by external factors and the increasingly competitive market;
  • Further extraction cost optimization program (including labour costs) in the medium term and optimization of capital expenditure;
  • Ensure a return for investors on invested capital.

 

In order to enable the Company to adapt to changing market conditions, an analysis was performed of many optional business and development scenarios according to the possible scenarios of changes in the coal market in Poland.

 

The following scenario was accepted as the best one:

  • Continue mining of the Bogdanka and Stefanów Fields and gaining access to the new areas of “Ostrów-Orzechów” and, in the long-term, the K6-K7 area using the mine's current infrastructure (without constructing new shafts and increased extraction);
  • Limit the development investments to those necessary from the point of view of making new deposits available — in particular in the period 2015-2017 — and to review investment spending to increase the production capacity by 2020;
  • Optimise the production level according to the market conditions, in particular, in the period 2015-2017.
  • Optimise long-term returns for investors taking into account the risks associated with the market conditions.

 

Applying the above assumptions will allow the Company to increase its effectiveness while at the same time put off the decision concerning the further course of its development until the hard coal market in Poland stabilises. The variant selected by the Management Board is the most flexible and it provides the opportunity to return to the planned increase in production and even its expansion.

The Company achieved the target production capacity of 10.5-11.5 million tonnes (depending on geological conditions), but due to the current market conditions, it forecasts the sale of commercial coal in 2015 at the level of 9.3-9.5 million tonnes. Capital expenditure at the Parent in 2015 will amount to approx. PLN 560 million with cash spending for the purchase of non-current assets and intangible assets in the amount of approx. PLN 640 million (due to the deferral of payment for the fourth plough).

The Company is currently developing variants of adapting the Company's operations to the level of coal mining (sales opportunities) consisting in further reduction in costs and capital expenditure. The level of investment for the coming years will be presented together with the Strategy update.

The Management Board analyses the dividend policy for subsequent years, taking into account the risks and price conditions. The Company considers securing liquidity and financial stability as the key factors. Dividend policy for the coming years will be adopted and announced by 30 June 2015, together with the Strategy for the period from 2015 to 2020.

 

Zbigniew Stopa, President of the Management Board at LW Bogdanka S.A.:

“Last year can be summarized as satisfactory. We have achieved our strategic goals, ending several years of investment process pursued with a view to doubling production capacity. After commissioning of the Mechanical Coal Processing Plant, which is one of the last stages of the investment program, our production capacity is already 10.5-11.5 million tonnes. As a result, despite the difficult situation in the coal market, our production has increased last year to 9.19 million tonnes from 8.35 million tonnes a year earlier. Thus, we have strengthened our position as the main supplier of coal to power plants in Poland — at the end of 2014 our market share was close to 25% and the power coal market share in total — 16.6%. Once again, we were the undisputed leader in terms of extraction efficiency and remained the most efficient mine in Poland by reducing the unit cash extraction cost by up to 12% in real terms as compared to 2012. I can state with satisfaction that we implemented all the elements of our strategy for 2013-2020 consistently and in accordance with the plan.

Unfortunately, the current market environment is very difficult. It is significantly impacted by the situation in Silesia and the planned recovery program for KW S.A., whose current form provides for further direct and indirect subsidies for unprofitable coal mines, which translates into their ability to sell the coal significantly below the production cost. This has an impact on the prices and demand in the Polish market, which affects other market players, including Bogdanka. The difficult situation on the Polish market is further complicated by the world market prices of coal and other energy commodities, such as oil and gas, which are currently at the lowest levels in years. Therefore, as announced, we reviewed our strategy. The aim is to prepare the Company to operate in volatile conditions under the influence of external factors and an increasingly competitive market.”

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czytaj-aktualnosc/2502/lw-bogdanka-gruop-after-fy-2014-implementation-of-strategic-objectives-and-solid-results-despite-difficult-market-conditions/ 2015-03-12 00:00:00 2502
Record - breaking coal extraction at Bogdanka in the fourth quarter of 2014 RECORD-BREAKING COAL EXTRACTION AT LW BOGDANKA S.A. IN THE FOURTH QUARTER
EXTRACTION IN THE ENTIRE 2014 AT THE LEVEL OF NEARLY 9.2 MILLION TONNES

 

Lubelski Węgiel BOGDANKA S.A., the most advanced and efficient hard coal mine in Poland and the leader in the domestic market for power coal producers, performed a record-breaking extraction in the Company’s history of 2.56 million tonnes of commercial coal in the fourth quarter of 2014. This exceeds the result achieved in the same period of the previous year (2.11 million tonnes) by 21.3% and represents an increase of 7.6% compared to the third quarter of 2014 (2.38 million tonnes).Cumulatively in the entire 2014 the Company extracted 9.19 million tonnes of commercial coal, which represents an increase of 10% as compared to the same period of the previous year, when the production of commercial coal reached 8.35 million tonnes.

 

The high production in the fourth quarter was related to, among other factors, the September launch of the new Mechanical Coal Processing Plant, which enabled the Company to double in the past quarter the nominal capacity of the Company with respect to processing on the “wet” line – it amounts currently to 2,400 tonnes/h. Also the mid-November launch of mining at wall 3/VI/385 in the Nadrybie Field contributed to the high production level – favourable geological conditions in this wall allowed to increase output in December 2014.

 

Zbigniew Stopa, President of the Management Board at LW Bogdanka S.A.:

“The extraction recorded in the fourth quarter of 2014 was top-level in the entire history of Bogdanka which translated into a 10% increase in the production of commercial coal on a year-to-year basis.Achieving the high level of production was possible due to the launch of the Mechanical Coal Processing Plant, which was one of the last stages of implementing our current investment programme – in the new plant, as at September 2014, we have already produced approx. 1 million net tonnes of coal.Also favourable geological conditions at wall 3/VI/385 contributed to the increase in the production of commercial coal, translating eventually into an increase in coal extraction in December 2014.”


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czytaj-aktualnosc/2491/record-breaking-coal-extraction-at-bogdanka-in-the-fourth-quarter-of-2014/ 2015-01-08 00:00:00 2491
Bogdanka included in the new Respect Index Warsaw Stock Exchange has announced the new composition of the responsible companies index – RESPECT Index. The new index includes 24 public companies. Lubelski Węgiel Bogdanka S.A. was included in the index for the seventh time.

The new composition of the index applies from 22 December 2014 r. 

The RESPECT Index project has been running on the Polish market since 2009. The aim of the project is to select companies managed in a responsible and sustainable manner. Moreover, strong emphasis is given to investment attractiveness of companies, which is demonstrated through the quality of reporting, level of investor relations and information governance.

The system of qualifying companies for the Respect Index has remained unchanged since last year.

For more information, see a press release and an announcement published by the WSE

 


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czytaj-aktualnosc/2489/bogdanka-included-in-the-new-respect-index/ 2014-12-19 00:00:00 2489
Bogdanka’s position regarding the K-6-7 area POSITION OF LW BOGDANKA S.A. ON THE REFUSAL OF THE MINISTRY OF ENVIRONMENT REGARDING THE K-6-7 AREA MINING LICENCE

 

Further to the decision of the Ministry of Environment delivered on 12 November 2014 to maintain the challenged decision of 5 September 2014 on refusal to grant a licence for extraction of hard coal in the “Lublin Coal Basin deposit — areas K-6 and K-7”, Lubelski Węgiel BOGDANKA S.A. hereby informs you that it will immediately file an appeal against this decision with the Provincial Administrative Court in Warsaw.

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:

“In our opinion, the decision of the Ministry of Environment is defective. Therefore, we do not lay down our arms in the fight for the licence for the K-6-7 area. In accordance with our previous declarations, the dispute will be settled in court.The granting of the licence for K-6-7 area to our Company is not only a solution that ensures the development of new and prospective areas by Bogdanka, the company which delivers more than 25% of coal to Polish power plants.It is also a guarantee that the deposits in this area which neighbours Bogdanka and has already been explored, would be used in the most effective and reasonable manner. This, indeed, lies in the best interest of the State Treasury.Moreover, it is difficult to agree with the statement on refusal to grant the licence on the grounds of the so called “public interest”.

Irrespective of the actions undertaken in connection with the K-6-7 area, the Company continues its work with an aim to ensure the development of Bogdanka to the north by preparing licence documentation to extract coal in the Ostrów and Orzechów areas, in respect of which we already possess exploration licences.With the current operating resources, the mine will continue operations until about 2034. However, our aim is to double (at least) these resources before 2020.”


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czytaj-aktualnosc/2487/bogdanka-s-position-regarding-the-k-6-7-area/ 2014-11-14 00:00:00 2487
Bogdanka after three quarters of 2014 BETTER RESULTS IN THE THIRD QUARTERIN COMPARISON WITH THE SECOND QUARTER DESPITE DIFFICULT MARKET CONDITIONS

 

The Lubelski Węgiel BOGDANKA Group, with its Parent – LW BOGDANKA S.A., the most modern and efficient hard coal mine in Poland and domestic leader on the market of power coal producers, after three quarters of 2014 generated revenue on sale amounting to PLN 1.5 billion, i.e. higher by 5.1% than the result achieved in the same period of the previous year.EBITDA for that period amounted to PLN 502.5 million, EBIT reached PLN 226.6 million and the net profit amounted to PLN 170.8 million.In the sole third quarter of 2014, revenue amounted to approx. PLN 545 million, EBITDA: to PLN 198.2 million, EBIT: to nearly PLN 100 million, and net profit: to PLN 79.4 million.

The results in the third quarter, although lower than on a year-to-year basis, were significantly better than those recorded in the second quarter of this year.Revenue increased on a quarter-to-quarter basis by 17.5%, EBIT: by 145.6%, EBITDA: by 52.3%, and net profit: by 175.4%. Despite challenging market situation and results being under the pressure of coal price drops, the Company’s profitability ratios remain at a level higher than average, which may be illustrated with EBITDA margin amounting in the third quarter of 2014 to 36.4%.

In the third quarter, the level of commercial coal production reached 2.38 million tonnes, which is a record-breaking result in the Company’s history, and translates into an increase by 10.3% compared to the third quarter of 2013, and by nearly 18% compared to the second quarter of 2014.As a result, the level of commercial coal production in the three quarters of 2014 reached 6.63 million tonnes, which represents an increase of 6.3% as compared to the same period of the previous year.The increase in net production was influenced by the launch in September 2014 of a new Mechanical Coal Processing Plant, where currently test runs are in progress.

In addition, the third quarter saw record-breaking sales of commercial coal at the level of 2.5 million tonnes, which means an increase of 9.6% as compared to the third quarter of 2013 and an increase of 18.7% as compared to the second quarter of 2014.The sales in the three quarters of 2014 reached a level of PLN 6.8 million tonnes, i.e. was higher than that recorded in the same period of the previous year by 12.1%.The achieved extraction and sales levels are reflected in the Company’s strong market position.At the end of September 2014 the market shares of LW BOGDANKA reached 18.9% for power coal market in Poland (compared to 14.8% at the end of 2013) and 25.3% for market of power coal sold to commercial power industry (compared to 19.3% at the end of 2013).

After nine months of 2014, the Company estimates that the production in 2014 will reach about 9.0 million tonnes. This is connected with the fact that the level of output is below the initial estimates, because the geological conditions in one of the currently excavated walls in the Stefanów Field are still unfavourable.


FINANCIAL PERFORMANCE - DETAILS

Selected financial data of the LW BOGDANKA Group after the third quarter and cumulatively after three quarters of 2014 is presented in the table below:

in PLN '000 Q3 2014 Q3 2013 Change Q1-Q3 2014 Q1-Q3 2013 Change
Revenue 544 973 539 395 1,0% 1 490 344 1 418 299 5,1%
Profit on sales 106 857 142 902 -25,2% 241 592 330 630 -26,9%
Gross margin on sales 19,6% 26,5% -26,0% 16,2% 23,3% -30,5%
EBITDA 198 216 201 791 -1,8% 502 484 548 341 -8,4%
EBITDA margin 36,4% 37,4% -2,7% 33,7% 38,7% -12,9%
Operating profit (EBIT) 99 950 119 403 -16,3% 226 608 307 559 -26,3%
EBIT margin 18,3% 22,1% -17,2% 15,2% 21,7% -30,0%
Net profit for the financial year 79 370 82 699 -4,0% 170 794 224 733 -24,0%
Net margin 14,6% 15,3% -4,6% 11,5% 15,8% -27,2%

During three quarters of 2014 the revenue obtained by LW BOGDANKA reached PLN 1.5 billion, so it was higher by 5.1% than in the same period a year before.

Approximately 92% of coal sales in the analysed period (in terms of value) were carried out on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia S.A., PGNiG Termika S.A., Elektrownia Ostrołęka S.A. and Zakłady Azotowe Puławy S.A.

Three quarters of 2014 were a difficult period in the industry because of a decrease in the demand for power coal and large quantities of coal piled on heaps in power plants and in Silesian mines.Consequently, the Company’s profitability ratios remained under the pressure of falling prices of coal earmarked for commercial power industry (which have decreased by 18% since the beginning of 2013).

The results in three quarters of 2014 were also influenced by the generated level of output which amounted to 66.6% compared to 69.2% during three quarters of 2013.In the sole third quarter, the level of output was 67.5%, compared to 68.7% a year before in the same period.The level of output, lower than the one recorded in the previous periods, was due to deposit parameters in the excavated walls in the Stefanów Field being still below the initial expectations.However, it is worth emphasizing that the Company exercises strict control over its expenditures.In the third quarter of 2014, costs by type grew only by 1.8%, while net production was higher by 10.3% as compared to the third quarter of 2013.By undertaking such measures, the Company can stand out in the industry with respect to financial indicators despite the challenging market situation. To give just one example, EBITDA for the third quarter of 2014 accounted for 36.4%, and EBITDA after three quarters of 2014 in cumulative terms reached 33.7%.


COAL PRODUCTION AND SALES

In the third quarter, the level of commercial coal production reached 2.38 million tonnes, which is a record-breaking result in the Company’s history, and translates into an increase by 10.3% compared to the third quarter of 2013, and by nearly 18% compared to the second quarter of 2014.As a result, the level of commercial coal production in the three quarters of 2014 reached 6.63 million tonnes, which represents an increase of 6.3% as compared to the same period of the previous year (6.24 million tonnes).

In addition, the third quarter saw record-breaking sales of commercial coal at the level of 2.5 million tonnes, which means an increase of 9.6% as compared to the third quarter of 2013 and an increase of 18.7% as compared to the second quarter of 2014.The sales in the three quarters of 2014 reached a level of PLN 6.8 million tonnes, i.e. was higher than that recorded in the same period of the previous year by 12.1%.

The Company continuously performs works with a view to making new excavations available.During three quarters of 2014, the Company completed 24.1 kilometres of galleries compared to 21.2 kilometres a year before, which means an increase by 13.7%.In the sole third quarter of 2014, the Company completed 7.8 kilometres galleries (compared to 7.9 kilometres in the same period of 2014).

Inventory of coal standing at a level of 52,300 tonnes at the end of September 2014 (i.e. lower by 69.5% from the one recorded at the end of September 2013) corresponds to ca. two days of commercial coal production by the Company.


LICENCES

As part of its strategy to extend the operating life of the mine, the Company is pursuing the first stage of the Ostrów deposit exploration licence, which progresses as scheduled. The Company managed to obtain the licence in June 2014, and is currently making preparations to file in 2016 an application for a licence to pursue mining operations in this deposit.Moreover, this year in October, the Company obtained the exploration licence for the Orzechów deposit.

 


STRATEGY

Due to significant change in the market situation, influenced by such factors as: material drop in coal prices, maintaining coal stock in the Silesian mines and power plants, as well as plans to restructure mining industry, the Company’s Management Board has been conducting work on assumptions for the Strategy update.While reviewing the Strategy, the Company will take into considerations such factors as the results of the licensing process, development plant of the new deposits, as well as mining and geological conditions.

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:

“In the third quarter of 2014, the market environment remained invariably difficult for our industry.Above-average coal reserves on mounds at Silesian mines and power plants, as well as projected restructuring processes in the mining industry are factors that cause the power industry to exert price pressure.Bogdanka has been coping well with that difficult situation, maintaining results and profitability ratios at a level higher than average in the industry, as well as persistently strengthening its market position.As planned, the Mechanical Coal Processing Plant was opened in the third quarter of 2014. The Company is now carrying out test runs.Moreover, the extraction and sales achieved in the period in question were the highest in the Company's history. This, along with the strict control of expenditures, has translated into significantly better financial results as compared to the second quarter of 2014.Unfortunately, difficult mining and geological conditions in one of the deposits are still having an influence on the level of commercial coal output.Taking this into consideration, we believe that net production in the entire 2014 may reach about 9.0 million tonnes, which is slightly lower than we estimated.

As declared, we continue to update our strategy for 2013-2010. Apart from the aspects regarding the market environment, the review of the strategy will also cover the results of the licensing process, development plans of the new deposits, as well as mining and geological conditions.”


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czytaj-aktualnosc/2485/bogdanka-after-three-quarters-of-2014/ 2014-11-06 00:00:00 2485
Position of the management board of LW Bogdanka concerning the collective dispute Bogdanka, 21 October 2014

 


POSITION OF THE MANAGEMENT BOARD OF LW BOGDANKA CONCERNING THE COLLECTIVE DISPUTE.

 

Lubelski Węgiel BOGDANKA S.A. hereby informs you that a collective dispute has arisen in participation of all trade unions operating at the Company. The dispute began due to a discrepancy of the parties’ positions regarding the amounts of increases in salaries in 2014.

Given that the coal industry in Poland is in a difficult situation and taking into account the market perspectives for power coal, and bearing in mind the Company's further growth and its economic indicators, the Management Board of LW Bogdanka S.A. is of the opinion that the demands of the trade unions are excessively high and cannot be accepted.

The Parties are to pursue further negotiations with the assistance of a mediator.

Please find below the position of the Management Board of our Company as regards this matter:

Dear Sir/Madam,

Today the Management Board of Lubelski Węgiel Bogdanka S.A. announced that a collective dispute had arisen with all the trade unions operating at the Company. The dispute is due to differences between the parties as regards the level of salary increase in 2014.

The discussions and negotiations to date, which were held in accordance with the provisions of the Act on Solving Collective Disputes, have not led to an agreement.
We find it difficult to agree upon the salary increase proposed by the unions. Neither the production nor the economic targets set at the beginning of 2014 will be met this year. The salary budget is the most important fixed component of costs. Determining its size so that all stakeholders in Bogdanka are at least partially satisfied is a very difficult and responsible task.

We should also bear in mind that this year the real value of our salaries has been increasing, as Poland has been experiencing deflation for the last several months. We are, however, aware of the expectations of our employees. There are a number of factors that have a significant impact on our position on salaries. Undoubtedly, the most important of these is the drop in coal prices on world markets, which has been taking place for quite some time now. The situation of other Polish mines and the steps they take to sell their coal also raise our concerns about the level of coal prices on the Polish market in the near future.

Moreover, we have not seen any significant effects of the attempts to limit imports. The proposed changes to the law as regards control and monitoring of solid fuels can further lead to a reduction in coal sales to individual customers. When analyzing the possibility of increasing salaries, we also have in mind the internal situation of our Company, which has changed. This year, we have repeatedly experienced mining and geological problems in the walls. Coal yield and effectiveness of production are all falling. We hope that the difficulties are temporary, and that we can remedy them very soon due to the commitment of our staff.

The Management Board recognizes the need to ensure fair working conditions and salaries for our employees, which should reflect both their workload and the current financial capabilities of the Company.

This does not mean that we will not continue talks with the trade unions. Given the differences of opinion, they will be held with the aid of a mediator – which is not the first such case in the past few years – and we hope that, like previously, they will lead to an agreement to the satisfaction of all parties to the dispute. Above all, we are relying on the sense of responsibility of our partners in the talks. The development of our mine and its economic security are of importance to all our stakeholders, and to our employees they are a guarantee of jobs in the future.

Management Board
of Lubelski Węgiel Bogdanka S.A.


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czytaj-aktualnosc/2482/position-of-the-management-board-of-lw-bogdanka-concerning-the-collective-dispute/ 2014-10-21 00:00:00 2482
LW Bogdanka S.A. extracted 2.38 million tonnes of coal in the third quarter of 2014 Lubelski Węgiel BOGDANKA S.A., the most advanced and efficient hard coal mine in Poland and the leader in the domestic market for power coal producers, recorded the production of commercial coal in Q3 2014 at a record-breaking level of 2.38 million tonnes, which represents an increase of 10.2% compared to the same period of last year (2.16 million tonnes), and of 17.8% compared to the second quarter of this year (2.02 million tonnes).Cumulatively after three quarters of 2014, the Company extracted 6.63 million tonnes of commercial coal, which represents an increase of 6.25% over the same period of the previous year (6.24 million tonnes).

Such a high yield in the third quarter was a result of launching, in September this year, of the new Mechanical Coal Processing Plant which is at the stage of a start-up.  The new plant will double the nominal capacity of the Company with respect to processing on the “wet” line, which is planned to reach the level of 2,400 tonnes per hour. The launch of the plant was a very important stage of the investment programme implemented by the Company in recent years with a view to doubling the Company’s production capacity relative to 2011.

Zbigniew Stopa, the President of the Management Board of LW BOGDANKA S.A.

"We are extremely satisfied with the high extraction in the third quarter achieved despite geological problems (thickness irregularities) on one of walls we currently exploit.The launch of the Mechanical Coal Processing Plant, which was our priority in recent months and which was effected in line with the schedule, contributed a lot to this result.It was a very important stage, and one of the last ones, of implementation of our current investment programme.In the new plant, we have already produced approx. 140,000 tonnes of coal net."


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czytaj-aktualnosc/2480/lw-bogdanka-s-a-extracted-2-38-million-tonnes-of-coal-in-the-third-quarter-of-2014/ 2014-10-01 00:00:00 2480
LW Bogdanka S.A. requested the ministry of environment to reconsider its applications for the K-6-7 area mining licence. Lubelski Węgiel BOGDANKA S.A., the most modern and efficient hard coal mine in Poland, in connection to the information it received on 8 September 2014, of a negative outcome regarding its application for the mining licence for the K-6-7 area, announces that it has applied for reconsideration of the case.

The reasons for the Company’s repeated application include public interest, incorrect application of the provisions of the geological and mining law with respect to the licence by the licensing authority, and the fact that conducting exploratory works in an already explored area (to an extent sufficient for launching the mining), is groundless and delays the already possible mining in this area, which constitutes activity against economic interest of the State Treasury.

Zbigniew Stopa, the President of the Management Board of LW BOGDANKA S.A.

“We hope that the Ministry of Environment will analyse our application once again and will consider legal arguments that speak in favour of Bogdanka, and the broadly taken public interest.In our opinion, extending the life of Bogdanka, a company considered to have a strategic meaning for the Polish economy and providing over 25% of coal supplies for Polish power plants, can surely be classified as the said public interest.The location of the deposits we are going after – directly next to areas currently exploited by us – means that we could start mining in new areas in no time and in a very efficient manner.This also means benefits when taking public interest under consideration - for a country, as the owner of deposits, most benefits are brought by mining in a reasonable manner, guaranteeing use of minerals with due respect for the environment.

It is worth underlining that awarding Bogdanka with a mining licence for the K-6-7 area, which we have been trying to obtain since 2010 (i.e. before any other entities potentially interested in the area appeared in the region), according to our mining know-how and existing expert analyses, will by no means prevent construction of another mine in the region.The K-6-7 area covers approx. 41 km2 of areas bordering with our deposits, while Lublin Basin (Zagłębie Lubelskie) consists of over 9,000 km2, initially earmarked for as many as 7 mines.”


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czytaj-aktualnosc/2478/lw-bogdanka-s-a-requested-the-ministry-of-environment-to-reconsider-its-applications-for-the-k-6-7-area-mining-licence-/ 2014-09-22 00:00:00 2478
Bogdanka is to request the ministry of environment to reconsider its application for the K-6-7 area mining licence Lubelski Węgiel BOGDANKA S.A. announces that it intends to promptly apply for reconsideration of its application for the mining licence for the K-6-7 area; LW BOGDANKA has recently received information of a negative response to the application.

Furthermore, the Company is preparing to launching works related to exploration licence for the “Ostrów” deposit, as received in recent months, and expects to obtain the exploration licence for the “Orzechów” deposit.
 

Zbigniew Stopa, the President of the Management Board of LW BOGDANKA S.A.
"Our application for the mining licence for the K-6-7 area, filed in December 2013, fulfilled all formal criteria, which was confirmed by the Ministry of Environment. It is also worth mentioning that works aiming at obtaining the licence had been conducted for more than three years. This is why we are surprised with the Ministry’s refusal (given after such a long time from filing) as well as with its substantiation referring to the “public interest.” As a company which employs more than 5,000 people and holds 25% share in the market of coal supplies for commercial power industry, we extremely seriously treat the rules of social responsibility and taking the public interest into account in our business activities. Therefore it is key for us to take measures for extending the mine’s life as efficiently and reasonably as possible. If we obtained a licence for the K-6-7 deposit which is located in the vicinity of our deposits, we would be able to start mining in new areas within a short time and with the use of the existing infrastructure. Therefore we will promptly request the Ministry of Environment to reconsider our application.
I also want to emphasize that our development towards the K-6-7 deposit is not the sole potential for extending our resources. As soon as already in September we are planning to start works related to the “Ostrów” deposit exploration licence, obtained in June this year, which will allow LW Bogdanka to analyse and prepare its development plans towards north. Our existing operative resources ensure the mine’s life to last up until ca. 2034, however we would like to double them before 2020. According to my assessment there is no threat to this plan."


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czytaj-aktualnosc/2476/bogdanka-is-to-request-the-ministry-of-environment-to-reconsider-its-application-for-the-k-6-7-area-mining-licence/ 2014-09-09 00:00:00 2476
Bogdanka after the first half of 2014 LW BOGDANKA S.A. AFTER THE FIRST HALF OF 2014: IMPLEMENTATION OF STRATEGIC ASSUMPTIONS CONTINUES AS PLANNED, RESULTS PRESSURED BY FALLING PRICES OF COAL AND DIFFICULT MARKET CONDITIONS

EBITDA for that period amounted to PLN 304.3 million, EBIT reached PLN 126.7 million and the net profit exceeded PLN 91.4 million. Despite challenging market situation and results being under the pressure of coal price drops, the Company’s profitability ratios remain at a level higher than the average recorded in the industry.

The Company completed the process of refinancing debts for the period of 5 years. The cost optimisation process has been gradually implemented.

The level of commercial coal production in the first half of 2014 was in line with the plan and amounted to 4.25 million tonnes, which means it was higher by 4.2% than in the same period of the previous year. The deposit parameters in the walls of the Stefanów Field, however, remained below the initial expectations, which together with the pending works aimed at launching a new part of the Mechanical Coal Processing Plant had a negative impact on the generated output. Sales of coal in the first half of 2014 amounted to 4.33 million tonnes, which compared to the first half of 2013 represents a rise by 13.6%. 

The levels of coal extraction and realised sales translate into a strong market position of the Company. At the end of the first half of 2014, market shares of LW BOGDANKA reached 19.1% for power coal market in Poland (compared to 14.8% at the end of 2013) and 25.2% for market of power coal sold to commercial power industry (compared to 19.3% at the end of 2013).

After 8 months of 2014, the Company expects the production for the entire 2014 to reach 9.3-9.6 million tonnes.

Currently, LW BOGDANKA has been launching the Mechanical Coal Processing Plant. Upon the completion of works, the Company will be able to increase its production capacity and improving the quality of the commercial coal. As part of the activity aimed at extending the mine’s operating life, in June 2014 the Company obtained licence for mining in K-3 area, and to examine the “Ostrów” deposit, as well as it waits for the decision concerning a mining licence in K-6-7 area and a licence to examine the “Orzechów” deposit.

 


FINANCIAL PERFORMANCE - DETAILS

Selected financial data of the LW BOGDANKA Group after the second quarter and first half of 2014 is presented in the table below:

in PLN '000 Q2 2014 Q2 2013 Change H1 2014 H1 2013 Change
Revenue 463,831 448,146 3.5% 945,371 878,904 7.6%
Profit on sales 49,630 96,943 -48.8% 134,735 187,728 -28.2%
Gross margin on sales 10.7% 21.6% -50.5% 14.3% 21.4% -33.2%
EBITDA 130,119 173,938 -25.2% 304,268 346,550 -12.2%
EBITDA margin 28.1% 38.8% -27.6% 32.2% 39.4% -18.3%
Operating profit (EBIT) 40,700 98,442 -58.7% 126,658 188,156 -32.7%
EBIT margin 8.8% 22.0% -60.0% 13.4% 21.4% -37.4%
Net profit for the financial year 28,824 71,939 -59.9% 91,424 142,034 -35.6%
Net margin 6.2% 16.1% -61.3% 9.7% 16.2% -40.2%

* The Group has applied amendments to IAS 19 (Employee benefits) and restated the comparable data for Q1 2013, therefore data for Q2 2013 has also been restated.

In the first half of 2014 the revenue generated by LW BOGDANKA reached PLN 945.4 million, higher by 7.6% than in the same period a year before.

Approximately 95% of coal sales during the first half of 2014 (in terms of value) were carried out on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, including Elektrownia Kozienice S.A., GDF Suez Energia S.A., PGNiG Termika S.A., Elektrownia Ostrołęka S.A. and Zakłady Azotowe Puławy S.A.

The first half of 2014 was a difficult period in the industry because of decreased power production and large quantities of coal piled on heaps in power plants and in Silesian mines. Consequently, the Company’s profitability ratios in the first half of 2014 were pressured by falling prices of coal earmarked for commercial power industry (which have decreased by 17% since the beginning of 2013).

The results in the first half of 2014 were also influenced by the generated level of output which amounted to 66.1% compared to 69.5% in the first half of 2013. In the second quarter only, the level of output was 65.2%, compared to 70.5% a year before in the same period. The level of output, lower than the one recorded in the previous periods, was due to deposit parameters in the excavated walls in the Stefanów Field being still below the initial expectations, which together with the ongoing works aimed at launching the new part of the Mechanical Coal Processing Plant had an impact on limiting the production of higher class commercial coal.

The result recorded in the second quarter 2014, and therefore in the entire first half-year, was influenced also by the creation of a provision for claims of the Social Security Institution (ZUS) for occupational injury (accident) insurance (PLN 10.4 million).

It is, however, worth noting that the financial ratios are at a level higher than average in the industry, which is shown for example by EBITDA margin after the first half of the year reaching 32.2%.

 


COAL PRODUCTION AND SALES

In the first half of 2014 the level of commercial coal production by the Company increased by 4.2% compared to the same period a year before and reached 4.25 million tonnes. 

The sales of commercial coal in the first half of 2014 were in line with the customer supply schedules and reached a level of 4.33 million tonnes, i.e. by 13.6% higher than that recorded in the same period of the previous year.

The Company continuously performs works with a view to making new excavations available. In the first half of 2014, the Company completed 16.3 kilometres of galleries compared to 13.4 kilometres a year before, which means an increase by 21.6%.

Inventory of coal standing at a level of 143,000 tonnes at the end of June 2014 (i.e. lower by 50.9% from the one recorded at the end of June 2013) corresponds to ca. five days of commercial coal production by the Company and was in line with its assumptions.

 


STRATEGY

The Company consistently pursues its development strategy for 2013-2020, the most important elements of which include the completion of the investment programme by 2015, with a view to doubling production capacities compared to 2011 as well as increasing two-fold the Company’s operating resources in the Lublin Coal Basin, and thus extending the mine’s operating life to around 2050.

LW BOGDANKA also wants to remain the leader of efficiency in the mining industry, among other things, by constructing a “smart mine.” It will be possible owing to continued development of the coal deposits management system and further application of information technology and automation solutions for the production process in the Company.

In connection with a material change in the market situation, since the date of publishing the Strategy for 2013-2020, the Management Board has commenced to work on updating the assumptions of this Strategy.

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:
“The first half of this year was a very difficult period for the industry, mainly due to further drops in coal prices – the prices for the commercial power industry have decreased from the beginning of 2013 by as much as 17%. Bogdanka has coped well with that difficult situation, maintaining results and profitability ratios at a level higher than average in the industry. By following consistently the sales plan, we have also strengthened our market position – at the end of H1 of 2014 our shares in the market of power coal sold to commercial power industry reached 25.2% compared to 19.3% at the end of 2013. Our assumptions regarding production in 2014 after eight months are at a level of 9.3 to 9.6 million tonnes, i.e. higher by at least 1 million tonnes than extraction in 2013. 

Currently, our priority is to complete the launch of the Mechanical Coal Processing Plant – the completion of works will enable us to increase the production capacity and improve the quality of the commercial coal. The launch of the processing plant will allow us to use the full extraction capacity from longwall faces and to achieve the target production capacity provided for in the strategy. We also perform reinforcement of the third ploughing system delivered in June 2014, and we ordered the fourth ploughing system which will be delivered at the end of the current year. We are also happy that we obtained lately a licence for mining in K-3 area and to examine the “Ostrów” deposit. We are also waiting for the examination of applications for a mining licence in K-6-7 area and a licence to examine the “Orzechów” deposit.”


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czytaj-aktualnosc/2474/bogdanka-after-the-first-half-of-2014/ 2014-08-28 00:00:00 2474
Mining licence for K-3 area and exploration licence for the Ostrów deposit granted to LW Bogdanka S.A. Lubelski Węgiel BOGDANKA S.A. obtained the K-3 area mining licence and the Ostrów deposit exploration licence.

Along with the K-3 area licence, the Company filed an application for the mining licence for the K-6-7 area (decision is pending).  LW BOGDANKA is also trying to obtain an exploration licence for the Ostrów deposit (relevant application was filed already in March 2013).

 

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:

This mining licence obtained for the K-3 area is another step in the pursuance of our strategy which assumes doubling the Company’s operative resources in the Lublin Coal Basin and extending the mine’s operating life to approx. 2050.  For this goal to be achieved it is however necessary to obtain mining licence also for the K-6-7 area. We are waiting for the application to be processed and the decision made in this respect.  K-3 and K-6-7 deposits are adjacent to our current deposits and mining pits, which means that we could start mining coal from the new areas with the use of the infrastructure we have now.

The exploration licence for the Ostrów deposit will allow us to analyse and prepare further development plans for LW Bogdanka.


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czytaj-aktualnosc/2472/mining-licence-for-k-3-area-and-exploration-licence-for-the-ostrow-deposit-granted-to-lw-bogdanka-s-a-/ 2014-07-23 00:00:00 2472
Bogdanka extract 2.02 million tonnes of coal in IIQ2014 Lubelski Węgiel BOGDANKA S.A., the most advanced and effective hard coal mine in Poland and the leader in the domestic market for power coal producers, extracted 2.02 million tonnes of commercial coal in the second quarter of 2014. This result is comparable in amount to the one achieved in the same period last year when the extraction reached 2.05 million tonnes. Cumulatively in the first half of 2014 the Company extracted 4.25 million tonnes of commercial coal, which represents an increase of 4.2% as compared to the same period of the previous year.  

The Company is currently implementing its strategy for the period 2013-2020, which, most importantly, provides for completing an investment programme by 2015 pursued with a view to doubling the production capacity in relation to 2011 and doubling the Company’s operating resources in the Lublin Coal Basin, and thereby extending the mine’s operating life to approx. 2050.

“Extraction in the second quarter of this year was consistent with our expectations. It was slightly lower than the one achieved in the first quarter of this year, which was a consequence of a decision to give the principal focus to the extraction of better quality coal until the Mechanical Coal Processing Plant is completed. The extraction level at the end of the first half of this year was higher than achieved in the same period of the previous year by 4.2%. Sales in the second quarter amounted to 2.10 million tonnes, which shows a slight decrease in comparison with the first quarter of this year. Sales for the entire first half of 2014 equalled 4.33 million tonnes and were higher than sales in the first half of 2013 by 13.6%. Market conditions in the power coal industry are still difficult, which has its influence on price levels”, said Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.

“Our priority for the upcoming months is the launch of the Mechanical Processing Plant, which is about to commence. This launch will enable us to produce better quality coal from the fourth quarter onwards, which should boost our financial results. We are also preparing to install the third ploughing system which has already been delivered and is to be launched in the third quarter of this year”, added Zbigniew Stopa.


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czytaj-aktualnosc/2470/bogdanka-extract-2-02-million-tonnes-of-coal-in-iiq2014/ 2014-07-03 00:00:00 2470
Convening the Annual General Shareholders Meeting  The Management Board of Lubelski Węgiel BOGDANKA S.A. with registered office in Bogdanka (the “Company”), acting under Article 395 and 399.1 of the Commercial Companies Code, and under Article 44.2 of the Company’s Articles of Association, hereby convenes the Annual General Shareholders Meeting of Lubelski Węgiel BOGDANKA S.A. in Bogdanka, to be held on 12 June 2014 at 12.00 am, in the Company’s offices in Bogdanka (Offices of the Management Board).
Agenda:
1) Opening the General Shareholders Meeting.
2) Electing the Chairman of the General Shareholders Meeting.
3) Acknowledging the General Shareholders Meeting to be validly convened and acknowledging its capacity to adopt resolutions.
4) Adopting the agenda.
5) Review of the Financial Statements and Directors’ Report on Operations of Lubelski Węgiel BOGDANKA S.A. for 2013.
6) Review of the Consolidated Financial Statements of the Lubelski Węgiel BOGDANKA S.A. Group and the Directors’ Report on Operations of the Lubelski Węgiel BOGDANKA S.A. Group for 2013.
7) Presentation of the Management Board’s motion regarding the distribution of net profit for 2013.
8) Presentation of the Report on Operations of the Supervisory Board of Lubelski Węgiel BOGDANKA S.A. for 2013.
9) Adopting resolutions on:
a) approval of the Financial Statements of Lubelski Węgiel BOGDANKA S.A. for 2013,
b) approval of the Directors’ Report on Operations of Lubelski Węgiel BOGDANKA S.A. for 2013,
c) approval of the Consolidated Financial Statements of the Lubelski Węgiel BOGDANKA S.A. Group for 2013,
d) approval of the Directors’ Report on Operations of the Lubelski Węgiel BOGDANKA S.A. Group for 2013,
e) granting discharge to the members of the Management Board of Lubelski Węgiel BOGDANKA S.A. in respect of performance of their duties in 2013,
f) approval of the Report on operations of the Supervisory Board of Lubelski Węgiel BOGDANKA S.A. for 2013,
g) granting discharge to the members of the Supervisory Board of Lubelski Węgiel BOGDANKA S.A. in respect of the performance of their duties in 2013,
h) distribution of net profit for 2013,
i) setting the dividend date and dividend payment date
10) Miscellaneous.
11) Closing the General Shareholders Meeting.

Shareholders’ right to participate in the General Shareholders Meeting
The date of registration to attend the General Shareholders Meeting (Registration Date) is 27 May 2014.
Only the persons being the Shareholders of the Company on the Registration Date have the right to participate in the General Shareholders Meeting.
The date of registering participation in the General Shareholders Meeting is the same for persons entitled under both bearer shares and registered shares.
Persons entitled under registered shares and temporary certificates and pledgees and usufructuaries who are entitled to vote, have the right to participate in the General Shareholders Meeting provided that they are entered in the share register on the Registration Date (27 May 2014).
The entity maintaining the securities account issues a certificate, bearing the Shareholder’s name, confirming the right to participate in the General Shareholders Meeting at the request of the person entitled under dematerialised bearer shares of the Company, submitted no earlier than the announcement of the convening the General Shareholders Meeting is published (13 May 2014) and no later than the first weekday following the Registration Date (28 May 2014).
A Shareholder can transfer its shares in the period between the Registration Date and the date when the General Shareholders Meeting ends.
The list of Shareholders entitled to attend the General Shareholders Meeting, signed by the Management Board, should contain the full name (the first name and surname) or business name of each eligible attendee, their place of residence (the registered office address), the number, types and codes of their shares and the number of votes they are entitled to; such a list will be available for viewing at the office of the Management Board for three weekdays prior to the date of the General Shareholders Meeting (9 June 2014, 10 June 2014 and 11 June 2014).
A natural person may provide his/her address for service instead of place of residence. A Shareholder may view the list of shareholders at the office of the Management Board and require a copy of the list, with the costs of preparing such a copy to be borne by the Shareholder.
A Shareholder may require that the list of shareholders be sent to them free of charge by electronic mail, in which case the Shareholder must specify the e-mail address to which the list is to be sent. The request for sending the shareholders list should be submitted at the offices of the Company’s Management Board or sent to wz@lw.com.pl. The request should be prepared in writing and signed by the Shareholder or persons who represent it.
A Shareholder may, one week prior to the date of the General Shareholders Meeting, require copies of motions regarding matters included on the agenda for the meeting (from 5 June 2014). Draft motions regarding issues put on the agenda are available at the Company’s website (www.lw.com.pl).
If the right to vote attached to shares is held by a pledgee or usufructuary, that fact will be noted on the list of shareholders at the request of the eligible entity.
The Shareholder’s right to require that certain matters be put on the agenda for the General Shareholders Meeting and to submit draft resolutions
The shareholder or shareholders representing at least one-twentieth of the share capital may demand including certain matters on the agenda of the closest General Shareholders Meeting. Such a request shall be submitted to the Management Board twenty-one days prior to the scheduled date of the General Shareholders Meeting at the latest (by 22 May 2014). Such a request should contain the reasons for or a draft version of the resolution regarding the proposed item of the agenda. The request may be submitted at the offices of the Company’s Management Board or sent via e-mail to wz@lw.com.pl.
The Company’s shareholder or shareholders representing at least one-twentieth of the share capital may, before the General Shareholders Meeting is held, submit to the Company, in writing - at the office of the Company’s Management Board, or via e-mail - at wz@lw.com.pl, draft resolutions regarding matters put on the agenda or matters which are to be put on the agenda. The Company must immediately publish such draft versions of resolutions on its website. During the General Shareholders Meeting any Shareholder of the Company is entitled to submit draft resolutions concerning items on the agenda.
In order to exercise the right to demand that certain matters be put on the agenda of the General Shareholders Meeting and to submit draft resolutions regarding matters put or which are to be put on the agenda of the General Shareholders Meeting, Shareholders should prove that they hold relevant number of shares as at the day of making the request, and attach a certificate confirming their right to attend the General Shareholders Meeting.
Furthermore, the Shareholders who are natural persons should attach to the above mentioned certificate, copies of documents confirming his/her identity, and the Shareholders who are legal persons and partnerships should attach copies of documents confirming their right of representation.
The Company’s Articles of Association do not stipulate a possibility to participate in the General Shareholders Meeting, speak or exercise the right to vote with the use of electronic means of communication.
The Company’s Articles of Association do not stipulate a possibility to exercise the right to vote by correspondence.
During the General Shareholders Meeting, votes cast by the shareholders will be calculated with the use of electronic means.
Exercising the voting right through a proxy
A Shareholder may participate in and vote at the General Shareholders Meeting in person or through a proxy.
A proxy exercises all rights of a Shareholder at the General Shareholders Meeting, unless otherwise provided for in the power of proxy.
A Shareholder holding shares registered in more than one securities account may appoint separate proxies for voting in respect of the shares in each such account.
A power of proxy to participate in the General Shareholders Meeting of the Company and to exercise voting rights must be granted in writing or in electronic form. A power of attorney granted in an electronic form need not have a secure electronic signature verified using a valid qualified certificate.
The Company takes all appropriate actions in order to identify the Shareholder and the proxy for the purpose of checking the validity of power of proxy granted in an electronic form.
In order for the power of proxy to be effectively granted in an electronic form, a Shareholder is obliged to send to wz@lw.com.pl the information to the effect that the power of proxy has been granted, along with the form – filled in and signed, scanned to the .pdf format. The Company makes the forms available at its website. Furthermore, the Shareholders who are natural persons should attach to the powers of proxy granted by them in an electronic form, copies of documents confirming their identity, and the Shareholders who are legal persons and partnerships should attach copies of documents confirming their right to act on their behalf. Forms for voting through a proxy will be available for downloading from the Company's website, at the Investor Ralations/General Shareholders tab.
Proxies who were granted powers of proxy in a written form, are obliged, before they attend the General Shareholders Meeting, to produce their ID cards and valid powers of proxy granted in a written form.
Proxies who were granted powers of proxy in an electronic form, are obliged, before they attend the General Shareholders Meeting, to produce their ID cards.
Access to documentation and information regarding the General Shareholders Meeting.
Persons entitled to attend the General Shareholders Meeting may obtain full text of documentation to be presented to the General Shareholders Meeting as well as draft resolutions at the offices of the Management Board and at the official website of the Company, www.ri.lw.com.pl., in the Investors Relations/General Shareholders Meeting tab, where other information about the General Shareholders Meeting is provided.
Please be informed that the session of the Company’s General Shareholders Meeting will be recorded.

An audio-video recording of the General Shareholders Meeting will be placed on the Investors Relations website.


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czytaj-aktualnosc/2468/convening-the-annual-general-shareholders-meeting/ 2014-05-13 11:22:00 2468
LW Bogdanka S.A. after Q1 2014: increased coal extraction and solid results despite harsh market conditions The Lubelski Węgiel BOGDANKA Group, with its Parent being Lubelski Węgiel BOGDANKA S.A. – the most modern and efficient hard coal mine in Poland and domestic leader on the market of power coal producers, showed in the first quarter of 2014 good results, in spite of difficult situation in the market. Revenue amounted to PLN 481.5 million (increase of 11.8%), EBITDA was PLN 174.1 million (increase of 0.9%) and EBIT was nearly PLN 86 million (decrease of 4.2%). The net profit reached PLN 62.6 million (decrease of 10.7%). Although decreased prices of coal affected profitability, the Company’s profitability ratios have remained at a level higher than average in the industry, which is shown for example by EBITDA margin of 36.2% after the first quarter.

The level of commercial coal production in the first quarter of 2014 was in line with the plan and amounted to 2.24 million tonnes, which means that it was higher by 10.2% than a year before and higher by 6.2% than in the fourth quarter of 2013. LW BOGDANKA upholds production assumptions for the entire 2014 at a level of 9.3 to 10 million tonnes.   

The levels of coal extraction and sales as realised translate into a strong market position of the Company. At the end of the first quarter of 2014 the market shares of LW BOGDANKA reached 18.6% for power coal market in Poland (compared to 14.8% at the end of 2013) and 24.8% for market of power coal sold to commercial power industry (compared to 19.3% at the end of 2013).

The Company consistently continues to implement its strategy for the years 2013-2020, the most important elements of which include the completion of the investment programme by 2015, with a view to doubling production capacities compared to 2011 as well as increasing two-fold the Company’s operating resources in the Lublin Coal Basin, and thus extending the mine’s operating life to around 2050.


FINANCIAL PERFORMANCE - DETAILS

Selected financial data of the LW BOGDANKA Group after the first quarter of 2014 is presented in the table below:

PLN ‘000 Q1 2014 Q1 2013 Change
Revenue    481 540 430 758 11,8%
Profit on sales 85 105 90 785 -6,3%
Profit on sales margin (Gross margin) 17,7% 21,1% -16,2%
EBITDA 174 149 172 612 0,9%
EBITDA margin 36,2% 40,1% -9,7%
Operating profit (EBIT) 85 958 89 714 -4,2%
EBIT margin 17,9% 20,8% -14,3%
Net profit for the financial year 62 600 70 095 -10,7%
Net margin 13,0% 16,3% -20,1%

        
In the first quarter of 2014 the revenue obtained by LW BOGDANKA reached PLN 481.5 million, so it was higher by 11.8% than in the same period a year before.

Approximately 90% of coal sales during the first quarter of 2014 (in terms of value) were carried out on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia S.A., PGNiG Termika S.A., Elektrownia Ostrołęka S.A. and Zakłady Azotowe Puławy S.A.

The first and second quarters of 2014 are difficult periods in the industry in view of negotiations regarding volumes of coal to be supplied to power plants, because of decreased power production and large quantities of coal piled on heaps in power plants and in Silesia mines. Consequently, the Company’s profitability ratios in the first quarter of 2014 were pressured by falling coal prices (which have decreased by 15% since the beginning of 2013). It is, however, worth noting that the ratios are at a level higher than average in the industry, which is shown for example by EBITDA margin of 36.2%.

The Company is consistently implementing the process of cost optimisation in order to achieve the level assumed in the strategy. Total costs were higher by 6.5%, whereas gross production went up by 12.8% and the length of completed gallery excavations increased by 36.8%.

 

COAL PRODUCTION AND SALES

In the first quarter of 2014 the level of commercial coal production by the Company increased by 10.2% compared to the same period a year before and reached 2.24 million tonnes.

The level of output in the first quarter of 2014 amounted to 66.9% compared to 68.6% in the first quarter of 2013 and 66.4% in the fourth quarter of 2013.

The sales of commercial coal in the first quarter of 2014 were in line with the customer delivery schedules and reached a level of 2.23 million tonnes, i.e. by 19.7% higher than that recorded in the same period of the previous year.

The Company continuously performs works with a view to making new excavations available. In the first quarter of 2014, the Company completed 9.3 kilometres galleries compared to 6.8 kilometres a year before, which means an increase by 36.8%.

The coal inventories at a level of 229,300 tonnes at the end of March 2014 corresponded more or less to 8 days of production and to the Company’s assumptions.


STRATEGY

The Company consistently follows its development strategy for 2013-2020. The most important components of this strategy include completion, by 2015, of the investment programme with a view to doubling the production capacities compared to 2011 and increasing two-fold the Company’s operating resources in the Lublin Coal Basin, and thus extending of the mine’s operating life to around 2050. As a result of increasing the extraction, the Company’s intention is to reach a share of 20% in the market of power coal sales in Poland by 2015.

LW BOGDANKA also wants to remain the leader of efficiency in the mining industry, among other things, by constructing a “smart mine.” It will be possible owing to continued development of the coal deposits management system and further application of information technology and automation solutions for the production process in the Company. Combined with continuous improvements in organisation of work and development of outsourcing, this should result in lowering the unit mining cash cost by 15% to 2017 (in real terms).
 

Zbigniew Stopa, President of Management Board of LW BOGDANKA S.A.:

“The first quarter of this year was a very difficult period for the industry, characterised by decreased production of energy based on hard coal, which was caused, among other things, by a mild winter and decreased energy consumption in the first quarter, as well as increased production of energy based on cheaper lignite. Although inventories on coal heaps in Silesia coal mines slightly decreased, we could observe increased inventories on coal heaps in the commercial power industry. Consequently, the first and second quarters of 2014 are difficult periods in the industry in view of negotiations regarding volumes of coal to be supplied to power plants, which was accompanied by falling coal prices – since the beginning of 2013 the prices have decreased by as much as 15%. I think that Bogdanka has coped well with that difficult situation, generating solid results and profitability ratios at a level higher than average in the industry. By following consistently the sales plan, we have also strengthened our market position – at the end of Q1 of 2014 our shares in the market of power coal sold to commercial power industry reached 24.8% compared to 19.3% at the end of 2013.

We are consistent in our focus to carry out our strategic plans – the priority for this year is to commence the operation of the Mechanical Coal Processing Plant, scheduled for September 2014. We continue actions with a view to acquiring new licences for excavation works, in order to increase our operating resources from current 237 million tonnes to approximately 450 million tonnes. We also uphold our assumptions regarding production in 2014 at a level of 9.3 to 10 million tonnes, i.e. higher by at least 1 million tonnes than extraction in 2013.”


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czytaj-aktualnosc/2466/lw-bogdanka-s-a-after-q1-2014-increased-coal-extraction-and-solid-results-despite-harsh-market-conditions/ 2014-05-08 00:00:00 2466
Bogdanka signed an annex with EDF Paliwa At the end of March 2014, Lubelski Węgiel Bogdanka S.A. signed an annex to the Long-Term Agreement for the Sale of Power Coal of 19 July 2011, concluded with EDF Paliwa Sp. z o.o. (formerly Energokrak Sp. z o.o.).

The signing of the document means to LW Bogdanka an extension of the planned cooperation. Originally supplies were scheduled until the end of 2016, while as a result of concluding the Annex, it extended to the end of 2017. In addition the parties to the agreement specified the terms and conditions of supplies between 2014 and 2017 (including the quantities and rules for setting supply prices) and established the supply price for the first half of 2015.

As a consequence of these changes, the value of the Agreement increased by 22.1 %. Other conditions of the agreement remain unchanged and do not deviate from market standards for such agreements.

The criterion for deeming the Agreement significant is that it exceeds 10% of the value of the Company’s equity and information about signed the Annex has been given by the Company in a current report to be found here.
 


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czytaj-aktualnosc/2464/bogdanka-signed-an-annex-with-edf-paliwa/ 2014-04-03 00:00:00 2464
COAL EXTRACTION AT LW BOGDANKA S.A. IN THE FIRST QUARTER OF 2014 REACHES 2.24 MILLION TONNES PRESS RELEASE

 

COAL EXTRACTION AT LW BOGDANKA S.A. IN THE FIRST QUARTER OF 2014 REACHES 2.24 MILLION TONNES

 

 

Lubelski Węgiel BOGDANKA S.A., the most advanced and effective hard coal mine in Poland and the leader in the domestic market for power coal producers, extracted 2.24 million tonnes of commercial coal in the first quarter of 2014. This exceeds the result achieved in the same period last year by 10.2% and represents an increase of 6.2% compared to the fourth quarter of 2013.

 

LW BOGDANKA plans to increase the extraction of commercial coal in 2014 by at least 1 million tonnes compared to 2013, to 9.3-10 million tonnes.

 

The Company is currently implementing its strategy for the period 2013-2020 announced in June 2013, which, most importantly, provides for completing an investment programme by 2015 pursued with a view to doubling the production capacity in relation to 2011 and increasing in a two-fold manner the Company’s operating resources in the Lublin Coal Basin, thereby extending the mine’s operating life approx. to 2050.

 

“Extraction after the first quarter was consistent with our expectations.We have already managed to overcome the geological difficulties in the wall closing seam 382 that we were struggling with in the fourth quarter of 2013. However, deposit parameters in the wall which was launched in the Stefanów Field in November 2013 are still below our initial expectations.At present, our efforts are focused on the Mechanical Coal Processing Plant so that we can open it on schedule.We are also making preparations to install the third ploughing system which is to be delivered in June and started in the third quarter of 2014”,said Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.

 

 

 

For further information please contact:

 

Magda Kołodziejczyk, M+G

tel.22 416 01 02, 501 16 88 07

e-mail: magda.kolodziejczyk@mplusg.com.pl

 

LW BOGDANKA – HIGHLIGHTS

 

Lubelski Węgiel Bogdanka S.A. is the most advanced and one of the largest hard coal mines in Poland and the leader of the domestic market for power coal producers.In 2013, production of Bogdanka’s commercial coal amounted to 8.35 million tonnes.

 

LW BOGDANKA conducts primarily mining operations with respect to extraction, agglomeration and sale of hard coal.

 

First and foremost, the BOGDANKA coal mine supplies industrial customers based in eastern and north-eastern Poland.Customer market is stable and sales are conducted mostly on the basis of long-term agreements.The major directions of sale of commercial coal from LW BOGDANKA are commercial and industrial power sectors.

 

The Company stands out in the industry with regard to its financial results, efficiency of hard coal extraction and investment plans.

 

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For further information visit www.bogdanka.eu


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czytaj-aktualnosc/2462/coal-extraction-at-lw-bogdanka-s-a-in-the-first-quarter-of-2014-reaches-2-24-million-tonnes/ 2014-04-03 00:00:00 2462
BOGDANKA after 2013 – higher extraction and very goog financial results The Lubelski Węgiel BOGDANKA Group, with its Parent – Lubelski Węgiel BOGDANKA S.A., the most modern and efficient hard coal mine in Poland and domestic leader on the market of power coal producers, generated very good financial results in 2013. The revenue amounted to PLN 1.9 billion (up by 3.49%), EBITDA amounted to PLN 754.9 million (up by 9.42%), and EBIT – PLN 424.8 (up by 9.14%). Net profit reached the figure of PLN 329.7 million (up by 6.7%).

In 2013, the level of commercial coal production reached 8.35 million tonnes, which means it was higher by 7.20% than a year before and the highest in LW BOGDANKA’s history. It was also slightly lower from what the Company expected, as a consequence of difficult geologic conditions in the fourth quarter 2013. The achieved extraction level and the realised sales translate into a strong market position of the Company. As at the end of 2013, LW BOGDANKA’s share in the power coal market in Poland reached 14.79%, and the share in sales of power coal to the commercial power industry was 19.32%.

LW BOGDANKA plans to increase the extraction of commercial coal in 2014 by at least 1 million tonnes compared to 2013, to 9.3-10 million tonnes. According to the Company’s assessment, however, the situation of the mining industry in 2014 will be very demanding.

The Company is focused on implementing its strategy for 2013-2020 announced in June 2013, whose key assumptions include completion by 2015 of the investment programme with a view to doubling the extraction compared to 2011 and a two-fold increase in the Company’s operating resources in the Lublin Coal Basin, and thus extension of the mine’s operating life to around 2050.


FINANCIAL RESULTS - DETAILS

Selected financial data of the LW BOGDANKA Group after the fourth quarter of 2013 is presented in the table below:

PLN '000 Q4 2013 Q4 2012 Change 2013 2012 Change
Revenue 481 531 443 561 8,56% 1 899 830 1 835 801 3,49%
Profit on sales 125 169 61 034 105,08% 455 799 395 400 15,28%
Gross margin on sales 25,99% 13,76% 88,88% 23,99% 21,54% 11,37%
EBITDA 206 600 120 182 71,91% 754 941 689 958 9,42%
EBITDA margin 42,90% 27,09% 58,36% 39,74% 37,58% 5,75%
Operating profit (EBIT) 117 244 48 439 142,04% 424 803 389 217 9,14%
EBIT margin 24,35% 10,92% 122,99% 22,36% 21,20% 5,47%
Net profit for the financial year 104 995 35 334 197,15% 329 728 309 016 6,70%
Net margin 21,80% 7,97% 173,53% 17,36% 16,83% 3,15%

        
In the fourth quarter of 2013 the revenue obtained by LW BOGDANKA reached PLN 481.53 million, so it was higher by 8.56% than a year before. In the entire 2013, the sales amounted to PLN 1.9 billion and were higher by 3.49% than in the previous year, and record-breaking in LW BOGDANKA’s history.

Approximately 85% of coal sales (in terms of value) during 2013 were carried out, as in the previous year, on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia S.A., PGNIG Termika S.A., Zakłady Azotowe Puławy S.A., EDF Paliwa Sp. z o.o. and Elektrownia Ostrołęka S.A.

Gross profit on sales reached PLN 455.8 million in 2013, which means an increase by 15.28%. The gross margin for 2013 equalled 23.99% and it was higher than in 2012 (21.54%) despite unfavourable trends on the market. Such result was possible due to consistently followed costs control policy.

 

COAL PRODUCTION AND SALES

In Q4 2013, the level of commercial coal production at the Company increased by nearly 23% compared to the same period a year before, reaching 2.1 million tonnes. The production of commercial coal in the entire 2013 amounted to 8.35 million tonnes, which translates into a year-to-year increase by 7.2%. It was the highest production level in LW BOGDANKA’s history. However it was slightly lower than expected, which was a result of worse geological conditions in the fourth quarter on one of the mined walls (the wall closing seam 382) and worse than expected parameters of the deposit in the Stefanów Field wall launched in November 2013.

The level of output in the fourth quarter amounted to 66.38% (compared to 61.67% in the fourth quarter of 2012). In the entire 2013 the level of output was 68.49% against 68.58% in 2012. 

The sales in 2013 was in line with the customer delivery schedules and reached a level of PLN 8.15 million tonnes, i.e. by 4.51% higher than that recorded in the previous year.

The Company continuously performs works with a view to making new excavations available:
•    In the fourth quarter of 2013, the Company completed 7.4 kilometres galleries compared to 6.56 kilometres a year before (increase by 12.77%)
•    In 2013, the Company completed 28.62 kilometres galleries compared to 23.25 kilometres in the same period of the previous year (increase by 5.36 kilometres, i.e. 23.07%)

Inventory of coal standing at a level of 216,440 tonnes at the end of 2013 corresponded to ca. eight days of commercial coal production by the Company and was in line with its assumptions.


STRATEGY

In June 2013 the Company announced development strategy for 2013-2020. Its key assumptions include completion by 2015 of the investment programme with a view to doubling the extraction compared to 2011 and a two-fold increase in the Company’s operating resources in the Lublin Coal Basin, and thus extension of the mine’s operating life to around 2050. As a result of increasing the extraction, the Company’s intention is to reach a share of 20% in the market of power coal sales in Poland by 2015.

LW BOGDANKA also wants to remain the leader of efficiency in the mining industry, among other things by constructing a “smart mine”. It will be possible owing to continued development of the coal deposits management system and further application of information technology and automation solutions for the production process in the Company. Combined with continuous improvements in organisation of work and development of outsourcing, this should result in lowering the unit mining cash cost by 15% to 2017 (in real terms).
 

Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.:
“I believe 2013 was a good year for our Company. Despite a difficult situation in the mining industry in Poland, we generated the record-breaking level of coal production and sales at LW BOGDANKA. Our financial results were also very good – revenue was close to PLN 2 billion, and net profit reached approx. PLN 330 million. According to our estimations the level of commercial coal production in 2014 will be higher by at least 1 million tonnes compared to 2013 and may reach 9.3-10 million tonnes. Observing the market we assess 2014 may also be difficult for the industry, we expect decreases in an average coal price against the price of 2013. Therefore we consistently pursue our strategic goals which include further improvement of efficiency and cost control, which is particularly important in the demanding market conditions.”

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czytaj-aktualnosc/2459/bogdanka-after-2013-higher-extraction-and-very-goog-financial-results/ 2014-03-20 00:00:00 2459
2,11 million tonnes of coal in fourth quarter and 8,35 million in the entire 2013 r.  

LW BOGDANKA S.A. EXTRACTS 2.11 MILLION TONNES OF COAL IN THE FOURTH QUARTER AND 8.35 MILLION TONNES IN THE ENTIRE 2013

 

Lubelski Węgiel Bogdanka S.A., the most advanced and effective hard coal mine in Poland and the leader in the domestic market for power coal producers, extracted 2.11 million tonnes of coal in the fourth quarter of 2013. This exceeds the result achieved in the same period last year by 23.4%, and is comparable to the result achieved in the third quarter of 2013 (2.16 million tonnes).Total extraction in 2013 amounted to 8.35 million tonnes, which gives an increase by approx. 7.3% compared to the extraction level achieved in 2012.

The Company is focused on implementing its strategy for 2013-2020 announced in June 2013, whose key assumptions include completion by 2015 of the investment programme with a view to doubling the extraction compared to 2011 and two-fold increase of the Company’s operating resources in the Lublin Coal Basin, and thus extension of the mine’s operating life to around 2050.

Zbigniew Stopa, President of the Management Board of LW Bogdanka S.A.: “In accordance with earlier declarations, the extraction in the fourth quarter was slightly lower than we had expected due to worse geotechnical conditions at one of the currently extracted walls (at the wall closing seam 382) and due to worse than expected deposit parameters (lower output quality) at the wall in Stefanów Field, launched in November last year.Nevertheless, it was a better quarter with respect to extraction than the fourth quarter of 2012.Also the extraction for the entire 2013 was higher than the one achieved in 2012, which confirms a consistent implementation of our strategy to double extraction as compared to 2011.”


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czytaj-aktualnosc/2456/2-11-million-tonnes-of-coal-in-fourth-quarter-and-8-35-million-in-the-entire-2013-r-/ 2014-01-10 00:00:00 2456
Member of the Company’s Supervisory Board Appointed We would like to announce that on 22 November 2013 the Extraordinary General Shareholders Meeting of Lubelski Węgiel Bogdanka appointed Mr Michał Stopyra to the Supervisory Board for the 8th term of office.  

 

Feel free to get acquainted with the resolutions adopted by the General Shareholders Meeting and with the résumé of Mr Michał Stopyra.


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czytaj-aktualnosc/2442/member-of-the-company-s-supervisory-board-appointed/ 2013-11-25 00:00:00 2442
LW BOGDANKA S.A. AFTER THREE QUARTERS OF 2013: COAL EXTRACTION AND RESULTS IN LINE WITH THE PLAN The Lubelski Węgiel BOGDANKA Group, with its Parent being Lubelski Węgiel BOGDANKA S.A. – the most modern and efficient hard coal mine in Poland and domestic leader on the market of power coal producers, earned in the third quarter of 2013 the revenue amounting to PLN 539.40 million (increase by 11.05% compared to the third quarter of 2012), the operating profit (EBIT) at a level of PLN 119.40 million and the net profit of PLN 82.70 million. The year-to-date figures after the three quarters are as follows: the revenue of PLN 1.42 billion, the operating profit of PLN 307.56 million and the net profit of PLN 224.73 million.

The gross profit generated in the third quarter of 2013 is the highest quarterly gross profit since the fourth quarter of 2011, which was extremely good for the Company. The gross margin for the third quarter of 2013 equalled 33.55%, which means that it was higher than in the third quarter of 2012 (26.45%), despite unfavourable trends on the market. Such result was possible due to consistently followed costs control policy.


The Group’s financial results (EBIT) in the third quarter of 2013 were affected by a change in provisions and a non-recurring item in the form of impairment loss on the Company’s assets. The Group’s operating profit adjusted with account taken of the above items reached PLN 154.98 million, so it was higher by 58.14% than a year before in the same period. EBIT adjusted for the three quarters of 2013 amounted to PLN 376.01 million, so it was higher by 4.05% than EBIT for the three quarters of 2012.

The level of commercial coal production in the third quarter of 2013 reached 2.16 million tonnes (more by 13.95% than a year before in the same period) and corresponded with the Company’s assumptions. As a result, the extraction of commercial coal after the three quarters of 2012 amounted to 6.24 million tonnes, which means a year-to-year increase by 2.81%.

The Company is focused on implementing its strategy for 2013-2020, announced this year in June, which envisages completion by 2015 of the investment programme with a view to doubling the extraction compared to 2011 and two-fold increase of the Company’s operating resources in the Lublin Coal Basin, and thus extension of the mine’s operating life to around 2050.


FINANCIAL RESULTS - DETAILS

Selected financial data of the LW BOGDANKA Group after the third quarter of 2013, as well as cumulatively, are presented in the table below:

PLN 000 Q3 2013 Q3 2012 Change Q1-Q3 2013 Q1-Q3 2012 Change
Revenue    539 395 485 70 11,05% 1 418 299 1 392 240 1,87%
Gross profit 180 982 128 487 40,86% 435 545 431 332 0,98%
Gross margin (%) 33,55% 26,45% 26,84% 30,71% 30,98% -0,87%
EBITDA 201 791 202 900 -0,55% 548 341 569 776 -3,76%
EBITDA margin (%) 37,41% 41,77% -10,44% 38,66% 40,93% -5,55%
EBIT 119 403 126 430 -5,56% 307 559 340 778 -9,75%
EBIT margin (%) 22,14% 26,03% -14,94% 21,69% 24,48% -11,40%
EBIT adjusted* 154 976 97 997 58,14% 376 014 361 385 4,05%
EBIT margin adjusted 28,73% 20,18% 42,37% 26,51% 25,96% 2,12%
Net profit 82 699 102 605 -19,40% 224 733 273 682 -17,89%
Net margin (%) 15,33% 21,13% -27,45% 15,85% 19,66% -19,38%

         * Adjusted EBIT – EBIT adjusted for the balance of provisions and non-recurring items


In the third quarter of 2013 the revenue obtained by LW BOGDANKA reached PLN 539.4 million, so it was higher by 11.05% than a year before. The year-to-date sales amounted to PLN 1.42 billion and were higher by 1.84% than a year before.

Approximately 90% of coal sales during the three quarters of 2013 (in terms of value) were carried out on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia S.A., PGNIG Termika S.A., Zakłady Azotowe Puławy S.A., EDF Paliwa Sp. z o.o. and Elektrownia Ostrołęka S.A.

The own selling cost in the third quarter of 2013 amounted to PLN 395.02 million, which means that it was higher by 1.58% compared with the third quarter of the previous year, with the sales increasing in that period by 11.13% on a year-to-year basis. The calculated unit cost of production of the sold coal went down in the third quarter of 2013 by ca. 10% as compared to the third quarter of 2012.

The gross margin for the third quarter of 2013 (33.55%) was higher than in the third quarter of 2012 (26.45%), despite unfavourable trends on the market.


COAL PRODUCTION AND SALES

In the third quarter of 2013 the level of commercial coal production by the Company corresponded with the assumptions and reached 2.16 million tonnes, which means that it was higher by 13.95% than a year before. As a result, the production of commercial coal in the entire first half-year period amounted to 6.24 million tonnes, which translates into a year-to-year increase by 2.81%.

Also the level of output in the third quarter corresponded with the Company’s assumptions and amounted to 68.7% (compared to 67.7% in the third quarter of 2012). After the three quarters the level of output was 69.2%, compared to 70.7% a year before in the same period.  

The sales in Q3 2013 was in line with the customer delivery schedules and reached a level of nearly PLN 2.28 million tonnes, i.e. by 11.13% higher than that recorded in the same period of the previous year. Cumulatively after three quarters the sales amounted to 6.08 million tonnes, which means an increase by 2.63% compared to the analogous period of 2012.

The Company continuously performs works with a view to making new excavations available:
•    In the third quarter of 2013, the Company completed 7.86 kilometres galleries compared to 5.67 kilometres a year before (increase by 39%)
•    In the three quarters of 2013, the Company completed 21.22 kilometres galleries compared to 16.70 kilometres in the same period of the previous year (increase by 4.52 kilometres, i.e. 27.07%)

The coal inventories at a level of 171,590 tonnes at the end of the third quarter (decrease by 3.33% compared to the level at the end of September 2012) corresponded more or less to 6 days of production by the Company and to the assumptions (changes in the level of inventories at the Company are seasonal, which is connected with the followed plan of excavations and plan of supplies to customers.


STRATEGY

In June this year LW BOGDANKA announced its development strategy for 2013-2020. The most important components of this strategy include completion by 2015 of the investment programme with a view to doubling the extraction compared to 2011 and two-fold increase in the Company’s operating resources in the Lublin Coal Basin, and thus extension of the mine’s operating life to around 2050. As a result of increasing the extraction, the Company’s intention is to reach a share of 20% in the market of power coal sales in Poland by 2015.

LW BOGDANKA also wants to remain the leader of efficiency in the mining industry, among others by constructing a “smart mine”. It will be possible owing to continued development of the coal deposits management system and further application of information technology and automation solutions for the production process in the Company. Combined with continuous improvements in organisation of work and development of outsourcing, this should result in lowering the unit mining cash cost by 15% to 2017 (in real terms).
 

Zbigniew Stopa, President of Management Board of LW BOGDANKA S.A.:
The third quarter of this year was again the time when we were able to achieve extraction and sales plans and generate solid financial results at all levels, despite difficult situation prevailing on the market. It was also the time when we consistently continued our investments with a view to doubling the production capacities to 2015. We also completed numerous preparatory works for the extraction in the following quarters. As already announced, in November we plan to commence the operation of the second ploughing system, which means that both our ploughing systems will be working at the same time. As a result, this year’s output will be much higher than a year before, however, it may turn out that it will not reach the upper limit as declared before because of difficult geotechnical conditions which appeared temporarily on one of the faces in this quarter. According to our estimates, the production of commercial coal this year may be at a level of 8.4-8.6 million tonnes. At the same time, we uphold the plan to achieve the production capacity of 11.5 million tonnes in 2015


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czytaj-aktualnosc/2438/lw-bogdanka-s-a-after-three-quarters-of-2013-coal-extraction-and-results-in-line-with-the-plan/ 2013-11-07 00:00:00 2438
Convening the Extraordinary General Shareholders Meeting The Management Board of Lubelski Węgiel BOGDANKA S.A. with registered office in Bogdanka (the “Company”), acting on the basis of a demand made by the Company’s Shareholder representing at least 1/20 of the Company’s share capital, Aviva Otwarty Fundusz Emerytalny Aviva BZ WBK S.A., under Article 399.1 and Article 400.1 of the Commercial Companies Code and under Article 44.3.2 of the Company’s Articles of Association, hereby decides to convene Extraordinary General Shareholders Meeting of Lubelski Węgiel BOGDANKA S.A. with registered office in Bogdanka on 22 November 2013 at 1.00 pm, on Warsaw Stock Exchange premises, NewConnect Room 4 Książęca street, Warsaw.

 
Current information on the General Assembly can be found here.

Agenda:
1. Opening the Extraordinary General Shareholders Meeting.

2. Electing the Chairman of the Extraordinary General Shareholders Meeting.

3. Acknowledging the Extraordinary General Shareholders Meeting to be validly convened and acknowledging its capacity to adopt resolutions.

4. Adopting the agenda.

5. Adoption of a resolution on changes in the Supervisory Board.

6. Miscellaneous.

7. Closing the Extraordinary General Shareholders Meeting.


Shareholders’ right to participate in the Extraordinary General Shareholders Meeting

The date of registration to attend the Extraordinary General Shareholders Meeting (Registration Date) is 6 November 2013.

Only the persons being the Shareholders of the Company on the Registration Date have the right to participate in the Extraordinary General Shareholders Meeting. 

The date of registering participation in the Extraordinary General Shareholders Meeting is the same for persons entitled under both bearer shares and registered shares.

Persons entitled under registered shares and temporary certificates and pledgees and usufructuaries who are entitled to vote, have the right to participate in the Extraordinar General Shareholders Meeting provided that they are entered in the share register on the Registration Date (06 November 2013).

The entity maintaining the securities account issues a certificate, bearing the Shareholder’s name, confirming the right to participate in the General Shareholders Meeting at the request of the person entitled under dematerialised bearer shares of the Company, submitted no earlier than the announcement of the convening the Extraordinary General Shareholders Meeting is published (25 October 2013) and no later than the first weekday following the Registration Date (07 November 2012).

A Shareholder can transfer its shares in the period between the Registration Date and the date when the Extraordinary General Shareholders Meeting ends.

The list of Shareholders entitled to attend the Extraordinary General Shareholders Meeting, signed by the Management Board, should contain the full name (the first name and surname) or business name of each eligible attendee, their place of residence (the registered office address), the number, types and codes of their shares and the number of votes they are entitled to; such a list will be available for viewing at the office of the Management Board for three weekdays prior to the date of the Extraordinary General Shareholders Meeting (19 November 2013, 20 November 2013, 21 November 2013).

A natural person may provide his/her address for service instead of place of residence. A Shareholder may view the list of shareholders at the office of the Management Board and require a copy of the list, with the costs of preparing such a copy to be borne by the Shareholder.

A Shareholder may require that the list of shareholders be sent to them free of charge by electronic mail, in which case the Shareholder must specify the e-mail address to which the list is to be sent. The request for sending the shareholders list should be submitted at the offices of the Company’s Management Board or sent to wz@lw.com.pl. The request should be prepared in writing and signed by the Shareholder or persons who represent it. A Shareholder may, one week prior to the date of the Extraordinary General Shareholders Meeting, require copies of motions regarding matters included on the agenda for the meeting (from 15 November 2013). Draft motions regarding issues put on the agenda are available at the Company’s website (www.lw.com.pl).

If the right to vote attached to shares is held by a pledgee or usufructuary, that fact will be noted on the list of shareholders at the request of the eligible entity.

The Shareholder’s right to require that certain matters be put on the agenda for the Extraordinary General Shareholders Meeting and to submit draft resolutions

The shareholder or shareholders representing at least one-twentieth of the share capital may demand including certain matters on the agenda of the closest General Shareholders Meeting.

Such a request shall be submitted to the Management Board twenty-one days prior to the scheduled date of the General Shareholders Meeting at the latest (by 01 November 2013). Such a request should contain the reasons for or a draft version of the resolution regarding the proposed item of the agenda. The request may be submitted at the offices of the Company’s Management Board or sent via e-mail to wz@lw.com.pl.

The Company’s shareholder or shareholders representing at least one-twentieth of the share capital may, before the Extraordinary General Shareholders Meeting is held, submit to the Company, in writing - at the office of the Company’s Management Board, or via e-mail - at wz@lw.com.pl, draft resolutions regarding matters put on the agenda or matters which are to be put on the agenda. The Company must immediately publish such draft versions of resolutions on its website. During the Extraordinary General Shareholders Meeting any Shareholder of the Company is entitled to submit draft resolutions concerning items on the agenda.

In order to exercise the right to demand that certain matters be put on the agenda of the Extraordinary General Shareholders Meeting and to submit draft resolutions regarding matters put or which are to be put on the agenda of the Extraordinary General Shareholders Meeting, Shareholders should prove that they hold relevant number of shares as at the day of making the request, and attach a certificate confirming their right to attend the Extraordinary General Shareholders Meeting.

Furthermore, the Shareholders who are natural persons should attach to the above mentioned certificate, copies of documents confirming his/her identity, and the Shareholders who are legal persons and partnerships should attach copies of documents confirming their right of representation.

The Company’s Articles of Association do not stipulate a possibility to participate in the Extraordinary General Shareholders Meeting, speak or exercise the right to vote with the use of electronic means of communication.

The Company’s Articles of Association do not stipulate a possibility to exercise the right to vote by correspondence.

Exercising the voting right through a proxy

A Shareholder may participate in and vote at the Extraordinary General Shareholders Meeting in person or through a proxy.

A proxy exercises all rights of a Shareholder at the Extraordinary General Shareholders Meeting, unless otherwise provided for in the power of proxy.

A Shareholder holding shares registered in more than one securities account may appoint separate proxies for voting in respect of the shares in each such account.
 

A power of proxy to participate in the Extraordinary General Shareholders Meeting of the Company and to exercise voting rights must be granted in writing or in electronic form. A power of attorney granted in an electronic form need not have a secure electronic signature verified using a valid qualified certificate.

The Company takes all appropriate actions in order to identify the Shareholder and the proxy for the purpose of checking the validity of power of proxy granted in an electronic form.

In order for the power of proxy to be effectively granted in an electronic form, a Shareholder is obliged to send to wz@lw.com.pl the information to the effect that the power of proxy has been granted, along with the form – filled in and signed, scanned to the .pdf format. The Company makes the forms available at its website. Furthermore, the Shareholders who are natural persons should attach to the powers of proxy granted by them in an electronic form, copies of documents confirming their identity, and the Shareholders who are legal persons and partnerships should attach copies of documents confirming their right to act on their behalf.

Forms for voting through a proxy will be available for downloading from the Company's website, at the Investor Ralations/General Shareholders tab.

Proxies who were granted powers of proxy in a written form, are obliged, before they attend the Extraordinary General Shareholders Meeting, to produce their ID cards and valid powers of proxy granted in a written form.

Proxies who were granted powers of proxy in an electronic form, are obliged, before they attend the Extraordinary General Shareholders Meeting, to produce their ID cards.
 

Access to documentation and information regarding the Extraordinary General Shareholders Meeting.

Persons entitled to attend the Extraordinary General Shareholders Meeting may obtain full text of documentation to be presented to the Extraordinary General Shareholders Meeting as well as draft resolutions at the offices of the Management Board and at the official website of the Company, www.lw.com.pl., in the corporate section, Investors Relations/ Extraordinary General Shareholders Meeting tab, where other information about the Extraordinary General Shareholders Meeting is provided.

An audio-video recording of the Extraordinary General Shareholders Meeting will be placed on the Company’s website.


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czytaj-aktualnosc/2430/convening-the-extraordinary-general-shareholders-meeting/ 2013-10-25 00:00:00 2430
2.16 million tonnes of coal extracted in the third quarter of 2013 LW BOGDANKA S.A. EXTRACTED 2.16 MILLION TONNES OF COAL
IN THE THIRD QUARTER OF 2013

 

 

Lubelski Węgiel BOGDANKA S.A., the most advanced and effective hard coal mine in Poland and the leader in the domestic market for power coal producers, extracted 2.16 million tonnes of coal in the third quarter of 2013. This exceeds the result achieved in the same period last year by 13.9%.Total extraction after three quarters of 2013 amounted to 6.24 million tonnes, which gives an increase by 2.8% compared to the extraction level achieved after three quarters of 2012.

 

High extraction level which we currently observe results from the Company’s consistently pursued strategy primarily aimed at increasing coal extraction to approx. 11.5 million tonnes per annum by the end of 2015 (from 5.84 million tonnes in 2011 and 7.79 million tonnes in 2012) and approx. 12 million tonnes per annum from 2018 onwards. As a result, the Company intends to increase its share in the market for power coal sales in Poland up to approx. 20% in 2020.

 

“Extraction after the third quarter was consistent with our expectations.At present, we are focused on continuing investments related to further increasing our production capacity which this year is expected to reach about 8.6–9 million tonnes of extracted coal.We have commenced works aimed at, among other things, launching the second coal ploughing panel in November 2013,” said Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.

 

For further information please contact

 

Magda Kołodziejczyk, M+G

tel.22 416 01 02, 501 16 88 07

e-mail: magda.kolodziejczyk@mplusg.com.pl  

 

LW BOGDANKA – HIGHLIGHTS

 

Lubelski Węgiel BOGDANKA S.A. is the most advanced and one of the largest hard coal mines in Poland and a leader of the domestic market for power coal producers.In 2012, production of Bogdanka’s commercial coal amounted to 7.78 million tonnes.

 

LW BOGDANKA conducts mining operations with respect to extraction, enriching and sale of hard coal.Additionally, the Company produces façade bricks in the process of utilising carboniferous rock waste stone in the EkoKLINKIER Construction Ceramics Plant.  

 

First and foremost, BOGDANKA coal mine supplies industrial customers based in East and North-East Poland.Customer market is stable and sales are conducted mostly on the basis of long-term agreements.The major directions of sale of commercial coal from LW BOGDANKA are commercial and industrial power sectors.

 

The Company stands out in the industry with regard to its financial results, efficiency of hard coal extraction and investment plans.

 

For further information visit www.bogdanka.eu


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czytaj-aktualnosc/2428/2-16-million-tonnes-of-coal-extracted-in-the-third-quarter-of-2013/ 2013-10-03 00:00:00 2428
Very good 2nd quarter, 1H2013 Results
LW BOGDANKA S.A. THROUGH 1ST HALF OF 2013: VERY GOOD 2ND QUARTER, PRODUCTION AND FINANCIAL RESULTS ACCORDING TO PLAN

 
The Lubelski Węgiel Bogdanka Capital Group, of which the dominant entity is Lubelski Węgiel Bogdanka S.A.-the most modern and efficient hard coal mine in Poland and the national leader in production of thermal coal-generated revenue in the 2nd quarter of 2013 of PLN 448.15m (an increase of 4.41% from 2Q 2012), an operating profit of PLN 100.72m (an increase of 5.96% from 2Q 2012) and a net profit of PLN 72.11m (up 0.34% from 2Q 2012). Through the 1st half of the year, revenue was PLN 878.90m, operating profit PLN 188.16m, and net profit PLN 142.03m.

Production of commercial coal in 2Q 2013, at 2.05m tonnes, 2.79% higher than in the same period of 2012, was in line with the company's projections. Production of commercial coal in the 1st half of the year totalled 4.08m tonnes.

The company is currently concentrating on implementation of the strategy for 2013-2020 announced in June of this year, the key elements of which are completion by 2015 of an investment program aimed at doubling production from 2011 levels and doubling the company's recoverable reserves in the Lublin Coal Basin, thus extending the life of the mine through 2050.

FINANCIAL RESULTS - DETAILS

Selected financial information of the LW Bogdanka Group for 2Q 2013 and 1H 2013 is presented in the table below:
 

(PLN '000) 2Q 2013 2Q 2012 Change (%) 1-2Q 2013 1-2Q 2012 Change (%)
Revenue 448,146 429,236 +4.41% 878,904 906,538 -3.05%
Gross profit 133,771
126,916
5.40% 254,563 302,845 -15.94%
Gross margin (%) 29.85% 29.57% 0.95% 28.96% 33.41% -13.32%
EBITDA 176,214 167,830 +5.00% 346,550 366,876 -5.54%
EBITDA margin (%) 39.32% 39.10% +0.56% 39.43% 40.47% -2.57%
Operating profit (EBIT) 100,718 95,051 +5.96% 188,156 214,348 -12.22%
EBIT margin
(%)
22.47% 22.14% +1.49% 21.41% 23.64% -9.43%
Net profit 72,108 71,867 +0.34% 142,034 171,077 -16.98%
Net margin
(%)
16.09% 16.74% -3.88% 16.16% 18.87% -14.36%

 
In the 2nd quarter of 2013, the company achieved very good financial results at all levels.

Revenue during the quarter was PLN 448.15m, or 4.41% higher year-on-year, mainly as a result of higher revenue from sales of coal (sales of a higher quantity of coal at a slightly lower unit price). Through the 1st half of this year, sales were 878.90m tonnes, slightly lower (3.05%) year-on-year.

About 90% of the coal sales in 1H 2013, by value, were made under long-term commercial contracts between LW Bogdanka S.A. and its main customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia S.A., PGNiG Termika S.A., Zakłady Azotowe Puławy S.A., EDF Paliwa Sp. z o.o. and Elektrownia Ostrołęka S.A.

Gross profit for 2Q 2013 was PLN 133.77m, up 5.40% year-on-year.

The EBIT margin for 2Q 2013 was slightly higher than in 2Q 2012 (22.47% v. 22.14%).

The company earned a net profit in 2Q 2013 of PLN 72.11m, slightly higher year-on-year (+0.34%).

Net profit for the 1st half of 2013 was PLN 142.03m, representing a decline of about 17% year-on-year.

The slightly weaker results in 1H 2013 compared to 1H 2012 were connected with the fact that 1Q 2012 was an exceptionally good period for the company in terms of the mining characteristics of the deposits at that time as well as the greater number of production days and the record results from the operation of the high-output ploughing system, which affected the results for the entire 1st half of 2012.

PRODUCTION AND SALE OF COAL

In 2Q 2013 the company's production of commercial coal was in line with projections, at 2.05m tonnes, up 2.79% year-on-year. Consequently, production of commercial coal through the 1st half of the year amounted to 4.08m tonnes.

The coal yield in 2Q 2013 was also consistent with the company's projections, at 70.54% (compared to 68.54% in 1Q 2013 and 72.19% in 2Q 2012). Through the 1st half of the year, the coal yield was 69.54%.

Sales in 2Q 2013 were consistent with the schedule for deliveries to customers and amounted to almost 1.95m tonnes, up 8.42% year-on-year. Through the 1st half of the year, sales were 3.81m tonnes, down 1.86% year-on-year.

The company continues to carry out works to obtain access to new headings:

•  In 2Q 2013, 6.52 km of galleries were completed, compared to 5.17 km in 2Q 2012 (+26.11%).

•  In 1H 2013, 13.36 km of galleries were completed, compared to 11.03 km in 1H 2012 (an increase of 2.33 km, or 21.14%).

Coal inventories stood at 291,000 tonnes at the end of 1H 2013 (9.48% lower than at the end of 1H 2012), equivalent to 11 days of production by the company and in line with projections. (Changes in the level of inventories at the company are seasonal in nature, which is connected with implementation of the mining plan and the plan for deliveries to customers.)

STRATEGY

In June of this year, LW Bogdanka announced its development strategy for 2013-2020. The key elements of the strategy are completion by 2015 of an investment program aimed at doubling output from 2011 levels and doubling the company's recoverable reserves in the Lublin Coal Basin, thus extending the life of the mine to about 2050. As a result of the increase in its output, the company intends to achieve a 20% share of the domestic market for sales of thermal coal by 2015.

LW Bogdanka also intends to remain the leader in mining efficiency, including through construction of a "Intelligent Mine". This will be possible thanks to further development of the system for management of deposits and further computerization and automation of the production process at the company. Combined with continual streamlining of the organization of work and growth in outsourcing, this should result in lowering the unit mining cash cost by 15% (in real terms) by 2017.

The company also intends to exploit potential synergies with producers of electricity and is analyzing two projects: modernization and expansion of Łęczyńska Energetyka and cooperation with the GDF Suez Polska Energia Group as part of the project for construction of a 500 MWe power plant near LW Bogdanka.

The company also announced its dividend policy for the upcoming years, which calls for distribution of a dividend equal to 60% of the consolidated net profit for the years 2013-2015.

"The 2nd quarter of this year was a period when the company achieved its production and sales projections and generated very good financial results at all levels, despite the difficult market situation," said Zbigniew Stopa, President of the Management Board of LW Bogdanka S.A. "It was also a period in which we conducted a series of access works in preparation for mining in the upcoming quarters, including completion of a 26% greater length of galleries than in the same period last year. We also conducted the refitting of our high-output ploughing system, and in late June began work on a new wall at Stefanów."

Stopa added: "We are currently focussing on continuation of planned investments connected with the further increase in our production capacity. The total value of these investments this year may reach about PLN 624m. We are also working on implementation of the other elements of the strategy for 2013-2020 announced in June."

 

For more information please contact: 

  Magda Kołodziejczyk, M+G

tel. (+48) 22 416 01 02, 501 16 88 07

e-mail: magda.kolodziejczyk@mplusg.com.pl

 
LW BOGDANKA - HIGHLIGHTS

 
Lubelski Węgiel Bogdanka S.A. is one of the largest and most advanced hard coal mines in Poland and the leader of the domestic market for thermal coal producers. In 2012, Bogdanka's commercial coal production was 7.78m tonnes.

LW Bogdanka conducts mining activity involving extraction, enrichment and sale of hard coal. The company also produces façade bricks utilizing carboniferous rock waste stone at the EkoKlinkier Construction Ceramics Plant.

 
The Bogdanka mine primarily supplies industrial customers in eastern and north-eastern Poland. The customer market is stable, and sales are conducted mostly on the basis of long-term contracts. The main outlet for commercial coal from LW Bogdanka is the commercial and industrial power sectors.

 The company stands out in the industry for its financial results, the efficiency of its hard coal extraction, and its investment plans.

 
More information at www.bogdanka.eu


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czytaj-aktualnosc/2426/very-good-2nd-quarter-1h2013-results/ 2013-08-29 00:00:00 2426
LW BOGDANKA S.A. – extraction of 4.08 million tonnes of coal in the first half of 2013 The current high level of extraction is the effect of consistently pursued strategy whose key objective is to increase extraction to 11.5 million tonnes per annum by the end of 2015 (from 5.84 million tonnes in 2011 and 7.78 million tonnes in 2012) and to 12 million tonnes from 2018, thus doubling the share in the market of power coal in Poland to approximately 20% in 2020.

Extraction in the second quarter of 2013 broken down by particular months was as follows:
- April: 619,060 tonnes
- May: 717,990 tonnes
- June: 713,000 tonnes


"The extraction after the first half of 2013 was in line with our assumptions. At the moment, we are focusing on the continuation of the planned investments pursued with a view to increasing our production capacity. We have already completed the process of re equipping our heavy-duty ploughing complex and on 29 June it began operations on a new wall in Stefanów," said Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.


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czytaj-aktualnosc/2370/lw-bogdanka-s-a-extraction-of-4-08-million-tonnes-of-coal-in-the-first-half-of-2013/ 2013-07-03 00:00:00 2370
LW Bogdanka S.A.’s Strategy for 2013-2020 And Dividend Policy On 3 June 2013, the Company announced its Development Strategy for 2013-2020. The most important aspects of the strategy include: completing the investment programme aimed at doubling the output and doubling the recoverable reserves of the Company in the Lublin Coal Basin by 2015, and thereby prolonging the mine's life until about 2050. Following the increase in its output, LW BOGDANKA S.A. intends to gain a 20% share in the domestic power coal supplies market by 2015.

LW BOGDANKA also wishes to remain a leader in effective mining by undertaking such projects as the construction of an "intelligent mine". Further development of the deposit management system and continued computerisation and automation of the production process at the Company will make it possible. Coupled with constant streamlining of the work organisation and further development of outsourcing, this is to bring a decrease of Unit Mining Cash Cost by 15% until 2017 (in real terms). 


The Company also intends to benefit from potential synergies with energy producers and considers two projects: modernisation and expansion of Łęczyńska Energetyka, and cooperation with GDF SUEZ Polska Energia Group as part of a project for the construction of a power plant with a capacity of 500 MWe in the vicinity of LW BOGDANKA. 


The Company also announced its dividend policy for the following years. In accordance with the policy, a recommendation will be made to allocate 60% of the consolidated net profit for 2013-2015 for dividends.


COMPLETION OF INVESTMENT PROCESS TO DOUBLE PRODUCTION


By 2015, the Company intends to complete an investment programme aimed at doubling the output in relation to 2011. Following the increase in its output, the Company intends to gain a 20% share in the domestic power coal supplies market by 2015 (as compared to a 10% share at the end of 2011, and a 14% share at the end of 2012). 


In addition, the Company also intends to increase its production capacity to approx. 12 million tonnes in 2018 as a result of modernising shaft 1.5 in Nadrybie. 


DOUBLING RESERVES AND PROLONGING MINE LIFE UNTIL 2050


LW BOGDANKA intends to almost double its recoverable reserves in the Lublin Coal Basin. The Company seeks to obtain new licences in the Lublin Coal Basin in order to increase its recoverable reserves from the current level of approx. 237 million tonnes up to approx. 450 million tonnes.
Given the average annual net level of production of approx. 12 million tonnes of coal, this would result in prolonging the life of the mine until about 2050 (with current reserves the life of the mine ends in 2034). 


FURTHER EFFECTIVENESS ENHANCEMENT AND INTELLIGENT MINE


LW BOGDANKA wishes to remain a leader with regard to effectiveness and innovative solutions in the mining industry by undertaking such projects as the construction of an "intelligent mine".
Further development of the deposit management system and continued computerisation and automation of the production process at the Company will make it possible. 


LW BOGDANKA is already using underground solutions that are unique to the Polish mining industry. These are the solutions used to support decisions during the process of preparing a deposit for an investment, which are adapted to the latest technical solutions in the global mining industry. 


The Company wishes to further improve its deposit management system (developed in cooperation with the Polish Academy of Sciences), which includes a digital deposit model (currently the only one in the Polish hard coal mining industry), digital map of mining excavations, and a digital schedule of opening-out, preparatory and exploitation works. 


In addition, as part of the project involving the construction of the "intelligent mine", LW BOGDANKA is also developing an object-oriented map of underground infrastructure. The next step will consist in introducing active tags in order to monitor the condition of underground infrastructure on the map of mining excavations. 


As a result of the activities mentioned above, as well as continuous improvement of work organisation and making use of outsourcing, the Company intends to reduce the Unit Mining Cash Cost by 15% until 2017 (in real terms) in relation to 2012.

POTENTIAL SYNERGIES WITH ENERGY PRODUCERS


The Company intends to benefit from potential synergies with energy producers and considers two projects: 


• executing an investment programme of the subsidiary Łęczyńska Energetyka Sp. z o.o. which provides for the construction of a power unit with a capacity of 69 MWt and 77 MWe together with necessary auxiliary installations;


• cooperation with GDF SUEZ Polska Energia Group as part of a project for the construction of a power plant with a capacity of 500 MWe in the vicinity of LW BOGDANKA - the Company would be a key supplier of fuel in the form of hard coal as well as coal slimes and their mixtures.

The final decision regarding the choice between the two investment options depends on the results of the analyses which are currently in progress. 


FINANCING AND DIVIDEND POLICY


The Company decided that the amount of necessary cash security against operational risks for 2013-2015 will be equivalent to monthly revenue on sales or approx. PLN 200-250 million. The Company intends to hold a debt (interest-bearing debt and employee liabilities) at the level of EBITDA x 1.50 or lower. 


At the same time, the Company developed a dividend policy under which 60% of consolidated net profit for 2013-2015 will be allocated to dividends. In the Company's opinion, such dividend policy will allow it to further enhance its value in the long-term perspective, and at the same time, ensure that shareholders receive the payment of dividend on profits at a level which complies with best practice of global raw material companies. 


Please feel free to view the files listed below:


- Presentation detailing key elements of LW BOGDANKA Strategy for 2013-2020 (pdf, 1.79 MB)
- Presentation of the Incentive Scheme (Managerial Options Scheme) (pdf, 985 KB), which is subject to the vote at the Annual General Shareholders Meeting on 27 June 2013.


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czytaj-aktualnosc/2359/lw-bogdanka-s-a-s-strategy-for-2013-2020-and-dividend-policy/ 2013-06-04 00:00:00 2359
Convening of the Annual General Shareholders Meeting Normal 0 21 false false false PL X-NONE X-NONE MicrosoftInternetExplorer4 The Management Board of Lubelski Węgiel BOGDANKA S.A. with registered office in Bogdanka (the "Company"), acting under Article 395 and 399.1 of the Commercial Companies Code, and under Article 44.2 of the Company's Articles of Association, hereby convenes the Annual General Shareholders Meeting of Lubelski Węgiel BOGDANKA S.A. in Bogdanka, to be held on 27 June 2012 at 11.00 am, in the Company's offices in Bogdanka (Offices of the Management Board).

 Agenda:

1)    Opening the General Shareholders Meeting.

2)    Electing the Chairman of the General Shareholders Meeting.

3)    Acknowledging the General Shareholders Meeting to be validly convened and acknowledging its capacity to adopt resolutions.

4)    Adopting the agenda.

5)    Electing the Ballot Counting Committee of the General Shareholders Meeting.

6)    Review of the Financial Statements and Directors' Report on Operations of Lubelski Węgiel BOGDANKA S.A. for 2012.

7)    Review of the Consolidated Financial Statements of the Lubelski Węgiel BOGDANKA S.A. Group and the Directors' Report on Operations of the Lubelski Węgiel BOGDANKA S.A. Group for 2012.

8)    Presentation of the Management Board's motion regarding the distribution of net profit for 2012.

9)    Presentation of the Report on Operations of the Supervisory Board of Lubelski Węgiel BOGDANKA S.A. for 2012.

10) Adopting resolutions on:

a)    approval of the Financial Statements of Lubelski Węgiel BOGDANKA S.A. for 2012,

b)   approval of the Directors' Report on Operations of Lubelski Węgiel BOGDANKA S.A. for 2012,

c)    approval of the Consolidated Financial Statements of the Lubelski Węgiel BOGDANKA S.A. Group for 2012,

d)    approval of the Directors' Report on Operations of the Lubelski Węgiel BOGDANKA S.A. Group for 2012,

e)    granting discharge to the members of the Management Board of Lubelski Węgiel BOGDANKA S.A. in respect of performance of their duties in 2012,

f)     approval of the Report on operations of the Supervisory Board of Lubelski Węgiel BOGDANKA S.A. for 2012,

g)    granting discharge to the members of the Supervisory Board of Lubelski Węgiel BOGDANKA S.A. in respect of the performance of their duties in 2012,

h)    distribution of net profit for 2012,

i)     setting the dividend date and dividend payment date

11) Adopting a resolution on the issue of series A subscription warrants with the exclusion of a pre-emptive right, conditional increase in the Company's share capital with the exclusion of a pre-emptive right, consent to carry out the Managerial Options Scheme in 2013-2018.

12) Adopting resolutions on amending the Company's Articles of Association.

13) Miscellaneous.

14) Closing the General Shareholders Meeting.

 
Shareholders' right to participate in the General Shareholders Meeting

The date of registration to attend the General Shareholders Meeting (Registration Date) is 11 June 2013.

Only the persons being the Shareholders of the Company on the Registration Date have the right to participate in the General Shareholders Meeting.

The date of registering participation in the General Shareholders Meeting is the same for persons entitled under both bearer shares and registered shares.

Persons entitled under registered shares and temporary certificates and pledgees and usufructuaries who are entitled to vote, have the right to participate in the General Shareholders Meeting provided that they are entered in the share register on the Registration Date (11 June 2012).

The entity maintaining the securities account issues a certificate, bearing the Shareholder's name, confirming the right to participate in the General Shareholders Meeting at the request of the person entitled under dematerialised bearer shares of the Company, submitted no earlier than the announcement of the convening the General Shareholders Meeting is published
(28 May 2012) and no later than the first weekday following the Registration Date (12 June 2012).

A Shareholder can transfer its shares in the period between the Registration Date and the date when the General Shareholders Meeting ends.

The list of Shareholders entitled to attend the General Shareholders Meeting, signed by the Management Board, should contain the full name (the first name and surname) or business name of each eligible attendee, their place of residence (the registered office address), the number, types and codes of their shares and the number of votes they are entitled to; such a list will be available for viewing at the office of the Management Board for three weekdays prior to the date of the General Shareholders Meeting (24 June 2012, 25 June 2012 and 26 June 2012).

A natural person may provide his/her address for service instead of place of residence. A Shareholder may view the list of shareholders at the office of the Management Board and require a copy of the list, with the costs of preparing such a copy to be borne by the Shareholder.

A Shareholder may require that the list of shareholders be sent to them free of charge by electronic mail, in which case the Shareholder must specify the e-mail address to which the list is to be sent. The request for sending the shareholders list should be submitted at the offices of the Company's Management Board or sent to wz@lw.com.pl. The request should be prepared in writing and signed by the Shareholder or persons who represent it.

A Shareholder may, one week prior to the date of the General Shareholders Meeting, require copies of motions regarding matters included on the agenda for the meeting (from 20 June 2012). Draft motions regarding issues put on the agenda are available at the Company's website (www.lw.com.pl).

If the right to vote attached to shares is held by a pledgee or usufructuary, that fact will be noted on the list of shareholders at the request of the eligible entity.

The Shareholder's right to require that certain matters be put on the agenda for the General Shareholders Meeting and to submit draft resolutions

The shareholder or shareholders representing at least one-twentieth of the share capital may demand including certain matters on the agenda of the closest General Shareholders Meeting. Such a request shall be submitted to the Management Board twenty-one days prior to the scheduled date of the General Shareholders Meeting at the latest (by 6 June 2012). Such a request should contain the reasons for or a draft version of the resolution regarding the proposed item of the agenda. The request may be submitted at the offices of the Company's Management Board or sent via e-mail to wz@lw.com.pl. 

The Company's shareholder or shareholders representing at least one-twentieth of the share capital may, before the General Shareholders Meeting is held, submit to the Company, in writing - at the office of the Company's Management Board, or via e-mail - at wz@lw.com.pl, draft resolutions regarding matters put on the agenda or matters which are to be put on the agenda. The Company must immediately publish such draft versions of resolutions on its website. During the General Shareholders Meeting any Shareholder of the Company is entitled to submit draft resolutions concerning items on the agenda.

In order to exercise the right to demand that certain matters be put on the agenda of the General Shareholders Meeting and to submit draft resolutions regarding matters put or which are to be put on the agenda of the General Shareholders Meeting, Shareholders should prove that they hold relevant number of shares as at the day of making the request, and attach a certificate confirming their right to attend the General Shareholders Meeting.

Furthermore, the Shareholders who are natural persons should attach to the above mentioned certificate, copies of documents confirming his/her identity, and the Shareholders who are legal persons and partnerships should attach copies of documents confirming their right of representation.

The Company's Articles of Association do not stipulate a possibility to participate in the General Shareholders Meeting, speak or exercise the right to vote with the use of electronic means of communication.

The Company's Articles of Association do not stipulate a possibility to exercise the right to vote by correspondence.

Exercising the voting right through a proxy

A Shareholder may participate in and vote at the General Shareholders Meeting in person or through a proxy.

A proxy exercises all rights of a Shareholder at the General Shareholders Meeting, unless otherwise provided for in the power of proxy.

A Shareholder holding shares registered in more than one securities account may appoint separate proxies for voting in respect of the shares in each such account.

A power of proxy to participate in the General Shareholders Meeting of the Company and to exercise voting rights must be granted in writing or in electronic form. A power of attorney granted in an electronic form need not have a secure electronic signature verified using a valid qualified certificate.

The Company takes all appropriate actions in order to identify the Shareholder and the proxy for the purpose of checking the validity of power of proxy granted in an electronic form.

In order for the power of proxy to be effectively granted in an electronic form, a Shareholder is obliged to send to wz@lw.com.pl the information to the effect that the power of proxy has been granted, along with the form - filled in and signed, scanned to the .pdf format. The Company makes the forms available at its website. Furthermore, the Shareholders who are natural persons should attach to the powers of proxy granted by them in an electronic form, copies of documents confirming their identity, and the Shareholders who are legal persons and partnerships should attach copies of documents confirming their right to act on their behalf. Forms for voting through a proxy will be available for downloading from the Company's website, at the Investor Ralations/General Shareholders tab.

Proxies who were granted powers of proxy in a written form, are obliged, before they attend the General Shareholders Meeting, to produce their ID cards and valid powers of proxy granted in a written form.

Proxies who were granted powers of proxy in an electronic form, are obliged, before they attend the General Shareholders Meeting, to produce their ID cards.

Access to documentation and information regarding the General Shareholders Meeting.

Persons entitled to attend the General Shareholders Meeting may obtain full text of documentation to be presented to the General Shareholders Meeting as well as draft resolutions at the offices of the Management Board and at the official website of the Company, www.lw.com.pl., in the corporate section, Investors Relations/General Shareholders Meeting tab, where other information about the General Shareholders Meeting is provided.

An audio-video recording of the General Shareholders Meeting will be placed on the Company's website.



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czytaj-aktualnosc/2361/convening-of-the-annual-general-shareholders-meeting/ 2013-05-30 00:00:00 2361
The Management Board's dividend proposal for 2012
Following the motion in question, the Management Board proposes to distribute the net profit generated by the Company in 2012 in the amount of PLN 287,026,808.52 (two hundred and eighty-seven million twenty-six thousand eight hundred and eight zlotys 52/100) as follows:

1. PLN 172,108,765.40 (one hundred and seventy-two million one hundred and eight thousand seven hundred and sixty-five zlotys 40/100) - allocate for a dividend, i.e. PLN 5.06 (five zlotys 06/100) per share.

2. The remainder, i.e. PLN 114,918,043.12 (one hundred and fourteen million nine hundred eighteen thousand and forty-three zloty 12/100) - to the Company's reserve capital.

The Management Board proposes to set the dividend date for 15 September 2013, and the dividend payment date for 1 October 2013.

A final decision regarding distribution of 2012 profit will be made by the Annual General Shareholders Meeting of Lubelski Węgiel BOGDANKA S.A.
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czytaj-aktualnosc/2357/the-management-board-039-s-dividend-proposal-for-2012/ 2013-05-29 00:00:00 2357
Summary of Q1 2013 – in line with the assumptions Summary of Q1 2013 - in line with the assumptions

LUBELSKI WĘGIEL BOGDANKA S.A. AFTER Q1 2013:

EXTRACTION AND FINANCIAL RESULTS - IN LINE WITH THE PLAN

In Q1 2013, the Lubelski Węgiel BOGDANKA Group, in which Lubelski Węgiel BOGDANKA S.A. - the most modern and effective hard coal mine in Poland and the national leader in the power coal producers market - is the parent company, generated revenue on sales in the amount of nearly PLN 430.8 million, operating profit reaching PLN 87.4 million and net profit in the amount of PLN 69.9 million.  The Company's results are in line with the assumptions.

Extraction at the level of 2.03 million tonnes reached in Q1 2013, i.e. at a level comparable to the last year's result, was also in line with the Company's assumptions.

The current high level of extraction is the effect of a consistently pursued strategy, the key objective of which is to increase extraction to about 11.5 million tonnes per annum once the investment in the Stefanów Field is completed (from almost 5.84 million tonnes in 2011), thus doubling the share in the market of hard coal producers in Poland.

At the end of 2012, the Company's share in sales in the national power coal market reached over 14%, compared to approx. 10% at the end of 2011.

FINANCIAL RESULTS - DETAILS

Selected financial information of the LW BOGDANKA Group after Q1 2013 are presented in the table below:

 PLN ‘000

 Q1 2013

  Q1 2012

  Q1 2011

Change
2013/2012


Change
2013/2011


Revenue on sales

430,758

477,302

309,961

-10%

+39%

Gross profit

120,792

175,929

72,818

-31%

+66%

EBITDA

170,336

199,046

77,906

-14%

+119%

Operating profit (EBIT)

87,438

119,297

43,698

-27%

+100%

Net profit

69,926

99,210

35,958

-30%

+95%

 

The main source of LW BOGDANKA Group's revenue on sales in the first quarter of 2013 was traditionally the production and sale of power coal. That activity accounted for 95.33% of the LW BOGDANKA Group's revenue on sale (96.87% in the same period of the previous year).

Over 80% of coal sales (in terms of value) were carried out on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A. - Grupa ENEA S.A., GDF Suez Energia S.A., PGNIG Termika, and Elektrownia Ostrołęka S.A.

Worse results in Q1 2013, compared to the same period in 2012, were connected with the fact that Q1 2012 was an exceptionally good period for the Company, both in terms of characteristics of the deposit exploited at that time, and a higher number of production days and record breaking work outcomes of the heavy-duty ploughing complex.


PROFITABILITY RATIOS OF LW BOGDANKA

The Company's profitability ratios in Q1 2013 were lower than in the same period in 2012 (which was due to the fact that Q1 2012 was exceptionally profitable for the Company), however remained at a favourable level, and were - in the majority of cases - slightly higher than the level achieved in the entire year 2012.


Profitability ratios of the LW BOGDANKA Group:

 Item

  Q1 2013

  Q1 2012

Change [p.p.]
2013/2012


Change [%] 2013/2012

Gross margin on sales

28.04%

36.86%

-8.82

-23.93%

EBITDA

39.54%

41.70%

-2.16

-5.18%

EBIT

20.30%

24.99%

-4.69

-18.77%

Gross margin

20.30%

25.92%

-5.62

-21.68%

Net margin

16.23%

20.79%

-4.56

-21.93%

Return on Assets

2.00%

3.13%

-1.13

-36.10%

Return on Equity

3.00%

4.53%

-1.53

-33.77%

 

Gross margin on sales of the LW BOGDANKA Group decreased from 36.86% (Q1 2012) to 28.04% (Q1 2013). The decrease in that ratio resulted from a negative growth rate of revenues relative to the increase of incurred costs, and products, goods and materials sold.

In the analysed period, the profitability of EBIT amounted to 20.30%, which means a decrease by 4.69 p.p. in comparison to the same period in the previous year. Apart from the reasons described in gross margins on sales, the change in value of the described ratio results also from higher sales and administrative costs.

EBITDA in Q1 2013 amounted to 39.54%, and was thus similar to the level from the same period of the previous year. Amortisation of the Group for Q1 2013 amounted to PLN 82.89 million, compared to PLN 79.75 million a year earlier.

Net margin on the Lubelski Węgiel Bogdanka Group's operations amounted to 16.23% for Q1 2013, as compared to 20.79% for Q1 2012.

COAL PRODUCTION AND SALES

In Q1 2013, the level of extraction of the Company's commercial coal was in line with the Company's assumptions and reached 2.03 million tonnes, which means that it stood at the level comparable to last year's result. Also, the achieved output level was in accordance with the assumptions and reached 68.5%.

Sales in Q1 2013 were compliant with the schedules of supplies to customers and reached the level of almost 1.86 million tonnes, i.e. it was higher by 10.74% from the last year's result. Stock of coal at the level of 172 thousand tonnes as at the end of Q1 equalled Company's seven-day production and was in line with the assumptions.

STRATEGY

Building and increasing the Company's value for the shareholders continues to be the strategic development objective of LW BOGDANKA S.A. It is to be achieved by means of:

  1. gaining access to new reserves and increasing the level of coal extraction based on the enlargement of the Stefanów Field;
  2. maintaining a stable position as the main supplier of coal in eastern Poland, in particular for the commercial power industry;
  3. strengthening its competitive position by cutting unit costs of extraction and production.

The main strategic development objectives defined by the Company include:

  1. doubling the coal production capacity to about 11.5 million tonnes after completing the investment in the Stefanów Field (from almost 5.84 million tonnes in 2011), thereby doubling the share in the market for hard coal producers in Poland,
  2. improving the efficiency of hard coal extraction and production;
  3. ensuring that LW BOGDANKA is self-sufficient regarding the supply of electricity by developing its activities as regards production of electricity;
  4. environmental protection measures.
 

 1_800

We inaugurated the year 2013 in line with our assumptions. In the first three months, we reached the planned levels of extraction and satisfactory output levels. I also consider the financial results for Q1 2013 to be satisfactory. Their lower level, compared to Q1 2012, was connected with the fact that Q1 of the previous year was an exceptionally good period for the Company, both in terms of characteristics of the deposit exploited at that time, and a higher number of production days and record breaking work outcomes of the ploughing complex in February and March 2012, said Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.

At the moment, we are focusing on the continuation of the planned investments pursued with a view to increasing our production capacity. Our plans include creating over 30 km of heading working. We are also working on re-equipping our heavy-duty ploughing complex, so that it is able to begin operation in June on a new wall in Stefanów, added Zbigniew Stopa.


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czytaj-aktualnosc/2363/summary-of-q1-2013-in-line-with-the-assumptions/ 2013-05-09 00:00:00 2363
Letter of intent - New coal power plant in the Lublin region Normal 0 21 false false false PL X-NONE X-NONE Elektrownia Połaniec S.A. - GDF Suez Energia Polska and LW Bogdanka S.A. signed a letter of intent regarding cooperation in the construction of a coal power plant in the Lublin region.

GDF SUEZ intends to build a power plant with the intended capacity of 500 MWe in the vicinity of LW Bogdanka, which might become a key supplier of fuel in the form of hard coal, as well as coal slimes and their mixtures. GDF SUEZ and LW Bogdanka consider taking joint action aimed at developing and implementing a project for the construction of the power plant.

The parties declared that, among other things, they will jointly conduct essential economic analyses of the project in 2013, and a dedicated Project Team will undertake measures aimed at establishing the terms and conditions of further cooperation.

If the project is successful, the power plant will be launched in 2020.


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czytaj-aktualnosc/2365/letter-of-intent-new-coal-power-plant-in-the-lublin-region/ 2013-05-08 00:00:00 2365
LW BOGDANKA – Extraction of 2.03 million tonnes of coal in the first quarter of 2013 Normal 0 21 false false false PL X-NONE X-NONE

PRESS RELEASE 

LW BOGDANKA – Extraction of 2.03 million tonnes of coal in the first quarter of 2013

Lubelski Węgiel BOGDANKA S.A., the most modern and effective hard coal mine in Poland, as well as the domestic leader on the power coal producers market, recorded in the first quarter of 2013 extraction of 2.03 million tonnes, i.e. a level similar to that achieved in the previous year. Extraction after the first quarter of 2013 complies with the Company’s assumptions.

The current high level of extraction (in the same period of 2011 it amounted to 1.32 million tonnes) is the effect of consistently pursued strategy whose key objective is to increase extraction to 11.5 million tonnes per annum once the investment in the Stefanów Field is completed (from 5.8 million tonnes in 2010 and almost 5.84 million tonnes in 2011), thus doubling the share in the market of hard coal producers in Poland.

 Extraction broken down by particular months was as follows:

- January 2013: 710,830,000 tonnes

- February 2013: 662,990,000 tonnes

- March 2013: 657,940,000 tonnes

 We inaugurated the year 2013 in line with our assumptions. In the first three months we reached the planned levels of extraction and satisfactory output levels. At the moment, we focus on the continuation of the planned investments pursued with a view to increasing our production capacity. Our plans include creating approx. 30 km of heading workings – announced Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.


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czytaj-aktualnosc/2355/lw-bogdanka-extraction-of-2-03-million-tonnes-of-coal-in-the-first-quarter-of-2013/ 2013-04-11 00:00:00 2355
Lubelski Węgiel BOGDANKA S.A. after 2012  
  Bogdanka, 21 March 2013

PRESS RELEASE


LUBELSKI WĘGIEL BOGDANKA S.A. AFTER 2012:
RECORD-BREAKING LEVEL OF EXTRACTION AND EXCELLENT FINANCIAL RESULTS



The Lubelski Węgiel BOGDANKA Group, whose Parent Company is Lubelski Węgiel BOGDANKA S.A. – Poland’s most modern and efficient hard coal mine, standing at the forefront of Polish power coal producers, in 2012 generated the revenue of more than PLN 1.8 billion, being by 41% higher than in 2011. The consolidated operating profit was higher than that achieved a year before by nearly 34.5% and amounted to PLN 357.3 million, and the Group’s net profit was PLN 289.8 million, which represents an increase by almost 31%.

The extraction level achieved in 2012 of 7.78 million tonnes was higher by 33.3% from the last year’s result, and at the same time it was a historical record of the Company.

The Company maintains good profitability ratios at all levels: gross margin in the entire year was 27.52%, EBIT: 19.47%, and net margin: 15.79%.

The increased extraction and better financial results are the effects of consistently pursued strategy whose key objective is to increase the level of extraction to 11.5 million tonnes per annum following the completion of an investment in the Stefanów Field (from 5.8 million tonnes in 2010 and almost 5.84 million tonnes in 2011), thus doubling the share in the market of hard coal producers in Poland.


FINANCIAL RESULTS - DETAILS
Detailed financial results of the LW BOGDANKA Group after the first quarter of 2012 and after the entire 2012 are presented in the table below:

PLN ‘000
Q4 2012
  Q4 2011
Change
2012
2011
Change
Revenue on sales
443 561
435 588
1.83%
1 835 801
1 301 349
41.07%
Gross profit
75 958
201 773
-62.35%
505 190
384 653
31.34%
EBITDA
90 613
229 941
-60.59%
658 089
450 603
46.05%
Operating profit
18 870
164 048
-88.50%
357 348
265 739
34.47%
Profit before taxation
17 180
162 882
-89.45%
358 325
271 981
31.75%
Net profit
12 845
133 203
-90.36%
289 782
221 246
30.98%
 
The main source of the LW BOGDANKA Group's revenue on sales in 2012 was, as usual, the production and sale of power coal. The sale of power coal accounted for 96.37% of the LW BOGDANKA Group's sales revenue (94.11% in the same period of the previous year). The increase in the revenue on sales of coal is a consequence of higher volumes of coal sold (by 31.06%), with a higher average annual unit sale price.

Almost 80% of coal sales (in terms of value) were carried out on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A. – Grupa ENEA S.A. (approx. 44% of share in revenue), Elektrownia Połaniec SA / GDF Suez Energia Polska – Grupa GDF Suez Energia Polska (approx. 17% of share in revenue), PGNIG Termika (approx. 14% of share in revenue) and Elektrownia Ostrołęka.

Weaker results of Q4 as compared to those of the same period of 2011 resulted from less favourable geological and mining conditions encountered by the Company in the plough wall of the Stefanów Field, consisting in a lack of seam continuity, which affected the extraction level.

Concurrently, Q4 of 2011 was exceptionally good since the plough system was launched at that time (usually the fourth quarter’s results are weaker for the mining industry, as provisions for employee costs are created, the awards related to the miner’s day – St. Barbara’s Day – as well as the so called 14th salaries are paid out).

PROFITABILITY RATIOS OF LW BOGDANKA

In 2012, the Company’s profitability ratios continued to stand at a good level, despite the worse Q4, as compared to the same period of 2011.

Profitability ratios of the LW BOGDANKA Group:


Item
2012
2011
Change
[p.p.]

2012-2011
Change
[%]
2012/2011

Gross margin on sales 27,52%
29,56%
-2,04
-6,90%
EBITDA
35,85%
34,63%
1,22
3,52%
EBIT
19,47%
20,42%
-0,95
-4,65%
Gross margin
19,52%
20,90%
-1,38
-6,60%
Net margin
15,79%
17,00%
-1,21
-7,12%
Return on Assets 8,83%
7,49%
1,34
17,89%
Return on Equity 13,06%
10,76%
2,30
21,38%
 
Gross margin on sales of the LW BOGDANKA Group decreased from 29.56% to 27.52%. The increase in that ratio resulted from a lower cost dynamics of revenues relative to the dynamics of costs of products, goods and materials sold.

EBITDA grew from 34.63% in 2011 to 35.85% in 2012. The change in value of the ratio was caused by depreciation going up from PLN 184.86 million (2011) to PLN 300.74 million (2012).

In the period under analysis, the EBIT value was 19.47%, being similar to last year’s figure.

Gross margin for 2012 was 19.52% and was slightly lower than that for 2011 (by 1.38 p.p.).

Net margin on the Lubelski Węgiel Bogdanka S.A. Group's operations amounted to 15.79% for 2012, compared to 17% for 2011.

The increase in assets profitability (from 7.49% to 8.83%) is a consequence of a higher dynamics of the net result relative to the dynamics of the average level of the Group’s assets.

As in the case of ROA, the increase in ROE was caused by a higher net profit (by 30.98%) with a concurrent increase (by 7.17%) in the value of shareholders’ equity.

COAL PRODUCTION AND SALES

In 2012 the level of commercial coal extraction achieved the Company’s historical record with the extraction of 7.78 million tonnes, representing an increase by 33.34% over 2011 (5.84 million tonnes). The average annual coal yield ratio (the relation of commercial coal to gross coal) achieved in 2012 was better than in 2011.

Sales in 2012 were nearly 7.8 million tonnes, i.e. by 31.06% more than in the previous year. The difference between the higher sales and the lower net coal extraction levels results from the Company selling majority of its reserves.

In consequence LW BOGDANKA’s reserve of coal as at 31 December 2012 was 18,300 tonnes, i.e. less by 34.19% from stock recorded in 2011. The above level of stock equals less than one-day coal production of the Company.
 
STRATEGY

Building and increasing the Company’s value for the shareholders continues to be the strategic development objective of LW BOGDANKA S.A. It is to be achieved by means of:
a)    gaining access to new reserves and increasing the level of coal extraction based on the enlargement of the Stefanów Field;
b)    maintaining a stable position as the main supplier of coal in eastern Poland, in particular for the commercial power industry;
c)    strengthening its competitive edge by cutting unit costs of extraction and production.

The main strategic development objectives defined by the Company are:
a)    doubling the coal production capacity to 11.5 million tonnes following the completion of the investment in the Stefanów Field (from 5.8 million tonnes in 2010 and almost 5.84 million tonnes in 2011), thus doubling the share in the market of hard coal producers in Poland,
b)    improving the efficiency of hard coal extraction and production;
c)    ensuring that LW BOGDANKA is self-sufficient regarding the supply of electricity by developing its activities as regards the production of electricity;
d)    environmental protection measures.

I find the results for 2012 satisfactory. Despite less favourable geological and mining conditions encountered in the fourth quarter by the Company in the plough wall of the Stefanów Field, consisting in a lack of seam continuity, and deteriorating situation in the coal market last year, we achieved the record-breaking level of extraction and excellent, also record, financial results. We began the year 2013 in line with our assumptions, with the extraction levels in January and February as scheduled, along with satisfactory yield levels. Currently we focus on continuing the planned investments which are to contribute to increasing our production capacity. We also signed an agreement for the third ploughing system to be delivered in June next year, and started in the third quarter of 2014,” said Zbigniew Stopa, President of the Management Board of LW BOGDANKA S.A.

“When observing the market, I believe that 2013 may be difficult for our industry as the demand for power coal drops and the coal reserves on mounds in many mines grow. Nevertheless I am convinced that LW BOGDANKA as the most efficient and most modern coal mine in Poland has the capacity to face difficult market conditions,” added Zbigniew Stopa.

Additional information available from:

Magda Kołodziejczyk, M+G
tel. (22) 416 01 02, 501 16 88 07
e-mail: magda.kolodziejczyk@mplusg.com.pl

 
LW BOGDANKA – HIGHLIGHTS

Lubelski Węgiel Bogdanka S.A. is one of the largest and most advanced hard coal mines in Poland and one of the leaders of the domestic market for power coal producers. In 2012, the Bogdanka’s commercial coal production was 7.78 million tonnes.

LW BOGDANKA conducts mining activity with respect to extraction, agglomeration and sale of hard coal. Additionally, the Company produces façade bricks in the process of utilising carboniferous rock waste stone in the EkoKLINKIER Construction Ceramics Plant.

The BOGDANKA mine supplies mainly the industrial customers based in the eastern and north-eastern Poland. Market of customers is stable, and the sale is carried out mainly under long-term agreements. LW BOGDANKA’s major sales channels are commercial power and industrial power industries.

The Company’s financial results, hard coal extraction capacity and investment plans distinguish the Company from other companies operating in the industry.

.
Additional information available at: www.bogdanka.eu


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czytaj-aktualnosc/2353/lubelski-wegiel-bogdanka-s-a-after-2012/ 2013-03-21 00:00:00 2353
LW BOGDANKA ENTERS INTO AN AGREEMENT FOR THE PURCHASE OF THE THIRD PLOUGHING SYSTEM Lubelski Węgiel BOGDANKA S.A. has entered into an agreement with Caterpillar Global Mining Europe GmbH for the supply of another longwall ploughing system. Under the agreement, the machine will be delivered to the Company by the end of 2014. Its start-up is scheduled for the third quarter of 2014.

This is going to be the third ploughing system at the Company. The other two systems which are currently in use have also been provided by Caterpillar Global Mining Europe GmbH, a leading producer of mining and construction equipment in the world.

"We have good experience with the ploughing systems currently in use. We are one of a few mines in Europe which takes advantage of this state-of-the-art solution. We also set the record for the highest daily output generated from a single wall with the use of a plough among mines which use this machine. This record-breaking output generated at the Bogdanka mine reached 24,900 tonnes per day. The third ploughing system will allow us to increase our annual output to approx. 11 million tonnes, and use our resources more efficiently,
” said Zbigniew Stopa, President of the Management Board of Bogdanka S.A.

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czytaj-aktualnosc/2346/lw-bogdanka-enters-into-an-agreement-for-the-purchase-of-the-third-ploughing-system/ 2013-02-12 00:00:00 2346
The Workshops Come to an End Over 3 thousand people throughout Poland learned how to invest on the stock exchange in an informed manner.

The second series of meetings dedicated to investing on the stock exchange, organised by the Polish State Treasury and a large group of partners, ended with workshops in Krosno. During less than 4 months, the workshops were attended by 3,074 stock investors. The stock exchange experts visited in total 33 cities throughout Poland. The meetings that raised the greatest popularity were held in Krakow (250 participants), Krosno (170) and Warsaw (165).

The workshops also give its participants an opportunity to consult experts from brokerage houses, the Polish Financial Supervision Authority and the Association of Individual Investors.
These free-of-charge workshops were addressed to persons interested in investing on the stock exchange, both the beginner investors and the more experienced ones.
The world of stock exchange and investing was gradually introduced to the workshop participants. They became acquainted with the organisation of the capital market in Poland, financial instruments and basic investing strategies, as well as learned how to behave during drops on the stock exchange. They also received practical advice related to factors they should follow while investing on the stock exchange and executing their rights as listed company’s shareholders.

The nation-wide series of meetings was held as a part of the educational programme “Civic Shareholding. Invest consciously” which was initiated by the Polish Ministry of Treasure and has been supported by 33 partners:
the Warsaw Stock Exchange, the National Depository for Securities, the Financial Supervision Authority, the Association of Individual Investors, the Polish Association of Listed Companies, the Chamber of Brokerage Houses, and the companies PZU, TAURON PE, Citi Handlowy, the LOTOS Group, JSW, KGHM, LW Bogdanka, PGNiG, PKN ORLEN, and PKO Bank Polski, with the cooperation of Havas PR Warsaw, GPW Media, and the Capital Market Institute.
Stock exchange meetings throughout Poland were organised by: the Brokerage Office of Alior Bank, Dom Maklerski Banku Ochrony Środowiska, Dom Maklerski BDM, the Brokerage House of Bank BGŻ, the Dom Maklerski Banku BPS, Dom Inwestycyjny BRE Banku, Dom Maklerski BZ WBK, Dom Maklerski Banku Handlowego, the Brokerage House of ING Securities, the Brokerage House of KBC Securities, the Brokerage House of PKO Bank Polski, Dom Maklerski Raiffeisen Bank Polska (Raiffeisen Brokers), Dom Inwestycyjny Xelion, X-Trade Brokers Dom Maklerski.
The Internet portals Biznes.Onet.pl and Biznes.pl are the media partners.

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czytaj-aktualnosc/2120/the-workshops-come-to-an-end/ 2013-02-01 00:00:00 2120
Change in the composition of the Management Board of the 7th term of office and the appointment of the Management Board of the 8th term of office
On 25 January 2013, the Supervisory Board of the Company has adopted resolutions about change in the composition of the Management Board of the 7th term of office and the appointment of the Management Board of the 8th term of office. Below we present changes with commentary of the Company’s Supervisory Board:

“In relation to the change in the position of the President of the Management Board (already in effect), and the approaching end of the Management Board’s term of office in the existing composition, the Supervisory Board has reconstructed the composition and appointed the Management Board of the new term of office.

On 4 March 2013, the Management Board of the 7th term of office will be joined by Mr Roger de Bazelaire, and on 11 March – Mr Krzysztof Szlaga. Once the above changes become effective, the Management Board of the 7th term of office, will work in the following composition:

-        Mr Zbigniew Stopa - President of the Management Board,

-        Mr Waldemar Bernaciak - Vice-President of the Management Board for Trade and Logistics,

-        Mr Roger De Bazelaire - Vice-President of the Management Board for Economic and Financial Affairs,

-        Mr Krystyna Borkowska - Vice-President of the Management Board, Chief Accountant,

-        Mr Krzysztof Szlaga – Member of the Management Board for Procurement and Investments, and

-        Mr Lech Tor – Member of the Management Board elected by employees.

Since the day of the Company’s Annual General Shareholders Meeting approving the 2012 financial statements, the Management Board of the 8th term of office will work in the following composition:

-        Mr Zbigniew Stopa – President of the Management Board,

-        Mr Waldemar Bernaciak – Vice-President of the Management Board for Trade and Logistics,

-        Mr Roger De Bazelaire – Vice-President of the Management Board for Economic and Financial Affairs,

-        Mr Krzysztof Szlaga – Member of the Management Board for Procurement and Investments.”

 

Education, qualifications and positions held by the appointed members of the LW Bogdanka S.A. Management Board, together with the description of their professional careers.

Appendix to Current Report No. 5/2013 dated 25 January 2013 - education, qualifications and positions held by Members of the Management Board of LW Bogdanka S.A. appointed for the 8th term of office, with the description of their professional careers

 

Zbigniew STOPA, M.Sc.Eng. President of the Management Board

Mr Zbigniew Stopa graduated in 1984 from the Faculty of Mining at the University of Science and Technology in Kraków with an M.Sc. Eng. degree, specialising in Deposits Exploitation Technology. In 1997 he completed postgraduate studies at the Central Mining Institute in Katowice in the field of Occupational Health and Safety Management. He attended a wide range of training sessions and specialist courses (the fundamentals of economics, human resource management, finances for managers), and completed a course for supervisory board members of State Treasury companies.

Mr Zbigniew Stopa's career has always been connected with Lubelski Węgiel BOGDANKA S.A. and its legal predecessors. In 1984-1985 he underwent a training programme underground, and from 1985 to 1987 he worked as an underground overman. In 1987 he was appointed to the position of an underground shift foreman, and towards the end of that year, to the position of an underground section foreman. In 1991-2006 he worked as an underground chief foreman. From May to December 2006 he served as the Manager of Mining Works of the Nadrybie mining field. On 15 December 2006 he was appointed Vice-President of the Management Board, Production Director. On 27 September 2012, Mr Zbigniew Stopa was entrusted, by the Supervisory Board, with the task of acting President of the Management Board. Since 23 November 2012, Mr Zbigniew Stopa has been the President of the Management Board of Lubelski Węgiel Bogdanka S.A.

Mr Zbigniew Stopa holds the following qualifications recognized by the State Mining Authority: head of the mining works department (1997) and higher-rank mining supervisor (1991). In 2007 he was appointed a member of the Mining Occupational Health and Safety Committee affiliated with the State Mining Authority in Katowice by the President of the State Mining Authority.

According to his statement, Mr Zbigniew Stopa has not been entered into the Register of Insolvent Debtors maintained pursuant to the National Court Register Act, nor is he involved in any activity competitive to that of the Company. He is not a partner in any business competitive to LW Bogdanka S.A., such as a private or any other partnership, nor a member of any governing body of any corporation or any other legal entity competitive to LW Bogdanka S.A.

 

Waldemar BERNACIAK, M.Sc.Eng. Vice-President of the Management Board for Trade and Logistics

Mr Waldemar Bernaciak graduated in 1979 from the Faculty of Mining at the University of Science and Technology in Kraków with an M.Sc. Eng. degree in mining and geology, specialising in Mine Design and Construction. In 1999 he completed postgraduate studies in the field of management and logistics at the University of Illinois at Urbana – Champaign. In 2001 he graduated from the School of Controlling in Katowice. Furthermore, he attended a number of specialist training courses (including a course on planning and production management in a coal mine at the Silesian University of Technology, logistics, materials management and stock optimisation). He also completed a course for supervisory board members of State Treasury companies.

From the outset his career has been in the mining industry. From 1979 to 1997 he was employed by Kombinat Budownictwa Górniczego WSCHÓD and its legal successors, where he held various positions, starting with a trainee miner, through an overman, shift foreman, section foreman, senior mining, engineering and construction specialist to the chief foreman (deputy mining works manager). For a decade, from 1997, he served as the Head of Materials and Machine Management Department at Lubelski Węgiel BOGDANKA S.A., while from February to August 2007 as the Head of Logistics. In August 2007 he was appointed Vice-President of the Management Board, Director for Mine Expansion, Trade and Logistics. Next, for several months he served as the acting President of the Management Board, Managing Director. On 16 February 2008 he returned to the position of Vice-President of the Management Board, Director for Mine Expansion, Trade and Logistics. In October 2008 he was appointed Vice-President of the Management Board for Trade and Logistics and has held that position to date.

Mr Waldemar Bernaciak holds the following qualifications recognized by the District Mining Authority in Lublin: Lower-rank mining supervisor, intermediate-rank mining supervisor, higher-rank mining supervisor, mining works manager.

According to his statement, Mr Waldemar Bernaciak has not been entered into the Register of Insolvent Debtors maintained pursuant to the National Court Register Act, nor is he involved in any activity competitive to that of the Company. He is not a partner in any business competitive to LW Bogdanka S.A., such as a private or any other partnership, nor a member of any governing body of any corporation or any other legal entity competitive to LW Bogdanka S.A.

 

Roger DE BAZELAIRE - Vice-President of the Management Board for Economic and Financial Affairs

Roger de Bazelaire has had more than 15 years of experience in investment and operational finance with companies operating in Central and Eastern Europe. In Poland since 1995, Mr Roger de Bazelaire worked with Dresdner Kleinwort Capital, as an Investment Director, in charge of restructuring and developing a portfolio of industrial companies (1995-2002). He subsequently joined Telekomunikacja Polska S.A., Poland’s largest telecom operator listed on the Warsaw Stock Exchange, as Chief Financial Officer and member of the Management Board (2002-2005). In 2009-2011, Mr Roger de Bazelaire has been Chief Financial Officer and member of the Management Board with Canal + Cyfrowy, a leading platform of pay TV in Poland. Mr Roger de Bazelaire has also gained experience as Chief Financial Officer in Russia (telecom), Romania and Bulgaria (retail). Earlier in his career, Mr Roger de Bazelaire worked six years in accounting and finance on infrastructure projects in Latin America with the French construction group Spie-Batignolles.

A French national, Mr Roger de Bazelaire was born in 1955 and graduated with HEC Paris in business and finance (Master Grande Ecole - 1978) and with Universite de Paris – Sorbonne (BA in philosophy - 1979). In addition to his native French, Mr Roger de Bazelaire is fluent in English, Spanish and Polish.

According to his statement, Mr Roger de Bazelaire has not been entered into the Register of Insolvent Debtors maintained pursuant to the National Court Register Act, nor is he involved in any activity competitive to that of the Company. He is not a partner in any business competitive to LW Bogdanka S.A., such as a private or any other partnership, nor a member of any governing body of any corporation or any other legal entity competitive to LW Bogdanka S.A.

 

Krzysztof SZLAGA – Member of the Management Board for Procurement and Investments

Mr Krzysztof Szlaga (36), in 2001 graduated from the University of Economics in Kraków, Faculty of Finance and Banking with an MA degree.   In 2001 he also received a Diplom-Betriebswirt diploma given by the University of Applied Sciences in Kiel (Germany), the Faculty of Economics.

Since 2001, Mr Krzysztof Szlaga was with KPMG Deutsche Treuhand-Gesellschaft, as Audit Senior at the Assurance Commercial Clients Department. In 2004 he joined Ernst & Young Audit Spółka z o.o., as Audit Senior at the Assurance and Business Services Department. In 2005-2008 he worked as Project Manager at the Restructuring/Operational Excellence and Corporate Finance at Roland Berger Strategy Consultants Spółka z o.o. In 2008-2010 he performed as the Member of the Management Board, Supply Chain Management Director at CTL Logistics S.A. In 2010-2012 he was a Supply Chain Management Director at Ruch S.A.

Mr Krzysztof Szlaga has fluent command of German and English.

According to his statement, Mr Krzysztof Szlaga has not been entered into the Register of Insolvent Debtors maintained pursuant to the National Court Register Act, nor is he involved in any activity competitive to that of the Company. He is not a partner in any business competitive to LW Bogdanka S.A., such as a private or any other partnership, nor a member of any governing body of any corporation or any other legal entity competitive to LW Bogdanka S.A.

 
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czytaj-aktualnosc/2124/change-in-the-composition-of-the-management-board-of-the-7th-term-of-office-and-the-appointment-of-the-management-board-of-the-8th-term-of-office/ 2013-01-25 00:00:00 2124
Bogdanka Included in the Respect Index Normal 0 21 false false false PL X-NONE X-NONE MicrosoftInternetExplorer4

On 24 January 2013,the Warsaw Stock Exchange once again nominated new laureates of the prestigious index of responsible companies - RESPECT Index. This time 20 listed companies were included to the composition of the new index.  It was the 6 time for Lubelski Węgiel Bogdanka S.A. to be qualified to this group.


The new composition of the index will be effective from 1 February 2013


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czytaj-aktualnosc/2122/bogdanka-included-in-the-respect-index/ 2013-01-25 00:00:00 2122
Output level of commercial coal in fourth quarter 2012 In fourth quarter 2012, LW Bogdanka S.A. achieved the output level of commercial coal 1 717 173 tonnes.
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czytaj-aktualnosc/2126/output-level-of-commercial-coal-in-fourth-quarter-2012/ 2013-01-04 00:00:00 2126
Conclusion of agreement on the supply of power coal with Grupa Ożarów S.A.
Over the last 12 months the total value of trading and the value of future supplies under agreements between the Company and Grupa Ożarów S.A. (the "Buyer”) amount to approx. PLN 295.04 million net.

Under the Agreement, the power coal will be supplied between 1 January 2013 and 31 December 2017.

The total value of the Agreement estimated in accordance with current prices amounts to approx. PLN 218.45 million net without regard to permissible deviations.

More information is available in current report.
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czytaj-aktualnosc/2128/conclusion-of-agreement-on-the-supply-of-power-coal-with-grupa-ozarow-s-a-/ 2012-12-05 00:00:00 2128
Civic Shareholding Workshops with a Thousand Participants Civic Shareholding Workshops with a Thousand Participants

The next 11 cities found out how to invest on the stock exchange.

This year’s series of meetings dedicated to investing on the stock exchange ended with workshops in Toruń. After a short break in December, January next year will see the beginning of a new selection of workshops organised in other cities. Meetings will be held in Warsaw, Częstochowa, Kielce, Wrocław, Gliwice, Krakow and Krosno.

In November alone, almost one thousand participants of the educational meetings held across the country learned the rules of conscious investing on the stock exchange, and familiarised themselves with shareholder rights.

A total of 2,100 people have so far attended 29 meetings run by experts from brokerage houses and specialists representing the Financial Supervision Authority and the Association of Individual Investors. The workshops which enjoyed enormous popularity were those organised in Katowice, Rzeszów and Poznań, which brought together about 130-160 participants each.

These free-of-charge workshops are addressed to those who are interested in investing on the stock exchange, both the beginner investors and the more experienced ones.

The series of national meetings was launched by the Ministry of State Treasury. The programme covers a total of 36 meetings held between September 2012 and January 2013 in 33 Polish cities.
    
We want to express our gratitude to all Participants and Partners who have so far been involved in the programme.

In order to sign in, please visit the website www.AkcjonariatObywatelski.pl, or contact the Association of Individual Investors. at + 48 71 332 95 65.

You can also find Civic Shareholding (Akcjonariat Obywatelski) on Facebook.

    
***
The series of meetings dedicated to investing on the stock exchange are held as part of the educational programme “Civic Shareholding. Invest consciously”, which is supported by 33 partners:
the Warsaw Stock Exchange, the National Depository for Securities, the Financial Supervision Authority, the Association of Individual Investors, the Polish Association of Listed Companies, the Chamber of Brokerage Houses, and the following companies: PZU, TAURON PE, Citi Handlowy, the LOTOS Group, JSW, KGHM, LW Bogdanka, PGNiG, PKN ORLEN, and PKO Bank Polski, with the cooperation of Euro RSCD, GPW Media, and Instytut Rynku Kapitałowego – WSE Research S.A.

Stock exchange meetings throughout Poland are organised by the following brokerage houses: the Brokerage Office of Alior Bank, Dom Maklerski Banku Ochrony Środowiska, Dom Maklerski BDM, the Brokerage House of Bank BGŻ, the Dom Maklerski Banku BPS, Dom Inwestycyjny BRE Banku, Dom Maklerski BZ WBK, Dom Maklerski Banku Handlowego, the Brokerage House of ING Securities, the Brokerage House of KBC Securities, the Brokerage House of PKO Bank Polski, Dom Maklerski Raiffeisen Bank Polska (Raiffeisen Brokers), Dom Inwestycyjny Xelion, X-Trade Brokers Dom Maklerski.
The Internet portals Biznes.Onet.pl and Biznes.pl are the media partners.


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czytaj-aktualnosc/2130/civic-shareholding-workshops-with-a-thousand-participants/ 2012-11-29 00:00:00 2130
Zbigniew Stopa – New President of Bogdanka’s Management Board During a meeting held on 23 November 2012, the Supervisory Board of Lubelski Węgiel Bogdanka S.A. decided on appointing Mr Zbigniew Stopa to the position of the President of the Company’s Management Board.

The appointment of the President of the Management Board was preceded with a recruitment process conducted by an international headhunting agency AMROP. Over 10 candidates interested in managing Bogdanka took part in the recruitment process. The Supervisory Board, having interviewed several persons appointed by the advisor, adopted a resolution whereby Mr Zbigniew Stopa will be in charge of the management over the Company.

“(…) The Board chose the undoubtedly best candidate,” said Witold Daniłowicz, Chairman of the Supervisory Board of LW Bogdanka S.A., in an interview for the Gazeta Giełdy Parkiet daily.
Zbigniew Stopa was born in 1959. From the beginnings of his professional career, he has been connected with Lubelski Węgiel Bogdanka. In his career, he experienced all levels of professional development in the Company – from being a trainee underground, through the position of underground chief foreman, to Manager of the Mining Department.

From December 2006, Zbigniew Stopa was Vice-President of the Management Board of LW Bogdanka S.A. and participated actively in the processes of the company’s IPO on the WSE and implementing the strategic development goals of LW Bogdanka S.A.

Zbigniew Stopa graduated in 1984 from the Faculty of Mining at the AGH University of Science and Technology with an M.Sc. Eng. degree in Mining and Geology, specialising in Deposits Exploitation Technology. In 1997, he completed postgraduate studies at the Central Mining Institute in Katowice in the field of Occupational Health and Safety Management. He has participated in numerous trainings and courses, he has also completed a course for candidates for members of Management Boards in companies wholly owned by the State Treasury.

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czytaj-aktualnosc/2132/zbigniew-stopa-new-president-of-bogdanka-s-management-board/ 2012-11-26 00:00:00 2132
LUBELSKI WĘGIEL BOGDANKA S.A. AFTER 3Qs 2012
BOGDANKA, 7 November 2012

PRESS RELEASE


LUBELSKI WĘGIEL BOGDANKA S.A. AFTER THREE QUARTERS OF 2012:
EXCELLENT FINANCIAL RESULTS AND THE COMPANY’S BREAKTHROUGH EXTRACTION LEVEL EXCEEDING 6 MILLION TONNES


Lubelski Węgiel BOGDANKA S.A., the most modern and effective hard coal mine in Poland, as well as the domestic leader on market of the power coal producers, after three quarters of 2012 generated revenue of nearly PLN 1.4 billion, 60.8% more than in the same period of the previous year. The consolidated operating profit was almost 233% higher than that achieved in 2011 and amounted to PLN 338.5 million, and the Group’s net profit achieved PLN 276.9 million, representing an increase of approx. 215%. After three quarters of 2012 the Company has exceeded the financial result earned in the entire 2011.

The extraction of 6.07 million tonnes was higher after three quarters by 58.3% from that achieved a year before.

During the three quarters of 2012, the Company also significantly improved profitability ratios at all levels, as compared to 2011. Net margin was almost doubled and after three quarters 2012 reached 19.9%.

The increased extraction and better financial results are the effects of consistently pursued strategy of which the key objective is to increase the level of extraction to 11.5 million tonnes per annum in 2014 (from 5.8 million tonnes in 2010), thus doubling the Company's share in the market of hard coal producers in Poland.



FINANCIAL RESULTS - DETAILS

Detailed financial results of the LW BOGDANKA Group after three quarters of 2012 are presented in the table below:
PLN ‘000
 Q3 2012  Q3 2011
Change
Q1-Q3
2012
Q1-Q3 2012
  Q1-Q3 2011
Change
Revenue on sales485 702
283 68071,21%1 392 240865 76160,81%
Gross profit
127 78761 264108,58%429 232182 880134,71%
EBITDA202 13375 477167,81%
567 476220 662157,17%
Operating profit125 66331 282
301,71%338 478101 691232,85%
Pre-tax profit127 78732 070298,46%341 145109 099
212,69%
Net profit
103 69025 880300,66% 276 937
88 043214,55%

The main source of the LW BOGDANKA Group's revenue on sales in three quarters of 2012 was the production and sale of power coal. In the first quarter that activity accounted for 96.84% of sales revenue generated by the Group (it was 93.03% in the same period of the previous year). The increase in the revenue on sales of coal is a consequence of higher volumes of coal sold (by 50.29%), with a higher unit sale price.

Almost 75% of coal sales (in terms of value) were carried out on the basis of long-term trade agreements concluded between LW BOGDANKA S.A. and its key customers, i.e. Elektrownia Kozienice S.A., GDF Suez Energia S.A., Elektrownia Ostrołęka S.A. and Grupa Ożarów.

PROFITABILITY RATIOS OF LW BOGDANKA

During the three quarters of 2012, the Company significantly improved all profitability ratios, as compared to the same period of 2011.
 
Profitability ratios of the LW BOGDANKA Group:
 Item
  Q1-Q3 2012  Q1-Q3 2011Change [p.p.]
2012/2011
Change
2012/2011
Gross margin on sales30,83%
21,12%9,71 45,98%
EBITDA40,76%25,49%15,2759,91%
EBIT
24,31%11,75%
12,56
106,89%
Gross margin
24,50%12,60%11,90 94,44%
Net margin
19,89%10,17%
9,72 95,58%
Return on Assets8,56%3,09%
5,47
 177,02%
Return on Equity12,51%4,43%
8,08
 182,39%


Gross margin on sales of the LW BOGDANKA Group increased from 21.12% (for three quarters of 2011) to 30.83% (for three quarters of 2012). The change in value of that ratio, was a result of a lower (in nominal terms) increase in the generated revenue in relation to the incurred costs of products, goods and materials – this also translated into an increased gross profit.

In the analysed period EBIT amounted to 24.31%, which means an increase by 12.56 p.p. in comparison to the analogous period in the previous year. The change in value of that ratio is related to a higher gross profit earned due to an increase in the Company’s coal sales revenue.

EBITDA increased from 25.49% to 40.76%. The change in value of the ratio results from – in addition to the increasing operating profit – the rising value of amortisation/depreciation (from PLN 118.97 million after three quarters of 2011 to PLN 229 million after three quarters of 2012).

The gross profitability for three quarters of 2012 amounted to 24.50% and was 11.90 p.p. higher than the gross profitability for three quarters of 2011.

Net margin on the Lubelski Węgiel Bogdanka Group's operations amounted to 19.89% for three quarters of 2012, given 10.17% for three quarters of 2011 (nearly 100% increase in profitability year on year).

The increase in ROA (from 3.09% for three quarters of 2011 to 8.56% three quarters of 2012) is a consequence of a higher dynamics of the net profit relative to the increase in the value of the Group’s assets. The effects of commercial use of assets that have been so far produced by the Company are already noticeable.

As in the case of ROA, the increase in ROE (from 4.43% to 12.51%) results from a higher net profit (by 214.55%); in nominal terms, the net profit increased by PLN 188.9 million, and the shareholders’ equity by PLN 140.9 million.

COAL PRODUCTION AND SALES

In the three quarters of 2012, the level of extraction of the commercial coal has, in the first time in the Company’s history, exceeded 6 million tonnes (reaching 6.07 million tonnes) and was higher by 58.29% from the value achieved in the same period a year before (3.8 million tonnes). The increase in the extraction of the commercial coal by nearly 60% occurred together with an increase by almost 43% of gross extraction, which means that during three quarters of 2012 the Company recorded a higher total output ratio than in the analogous period of the previous year.

The sales in the three quarters of 2012 reached a level of PLN 5.9 million tonnes, by 50.29% higher than that recorded in the previous year.

Stock of coal at LW BOGDANKA as at 30 September 2012 amounted to 166,100 tonnes, and was 570.9% higher than in the same period of 2011.

The current stock level amounts to less than a seven-day extraction of commercial coal.
 
STRATEGY

Developing and increasing the Company’s value for the shareholders continue to be the strategic development objectives of LW BOGDANKA S.A. They are to be achieved by means of:
a) gaining access to new reserves and increasing the level of coal extraction based on the enlargement of the Stefanów Field;
b) maintaining a stable position as the main supplier of coal in eastern Poland, in particular for the commercial power industry;
c)  strengthening its competitive position by cutting unit costs of extraction and production.

The main strategic development objectives defined by the Company are:
a) doubling the coal production capacity to 11.5 million tonnes in 2014 (from 5.8 million tonnes in 2010), thereby doubling the share in the market of hard coal producers in Poland,
b) improving the efficiency of hard coal extraction and production;
c) ensuring that LW BOGDANKA is self-sufficient regarding the supply of electricity by developing its activities as regards the production of electricity;
d) environmental protection measures.

Zbigniew Stopa, acting President of the Management Board and the Vice-President for Technical Affairs of LW BOGDANKA S.A. commented:
”During the IPO process and for more than three years of the Company’s presence at the stock exchange, we convinced investors and shareholders that Bogdanka is a good business. We know how to run it. And the market trusted us. Our results after three quarters, which already exceed the values generated in the entire 2011, the increasing profitability ratios approaching the planned values at all levels as well as a successive reduction of unit costs, show that we were worth this trust, and that we continue to build value for shareholders.”
“At the end of October we finalised the installation of the second plough system to mine longwalls in thin deposits. We are now carrying out the technological start-up of the machines and preparatory works underground to launch extraction of next panels,” Zbigniew Stopa added.

For more information, contact:

Tomasz Zięba
Press Spokesman of LW Bogdanka S.A.
tel. (81) 462 56 04
e-mail: tzieba@lw.com.pl

Magda Kołodziejczyk, M+G
tel. (22) 416 01 02, 501 16 88 07
e-mail: magda.kolodziejczyk@mplusg.com.pl

LW BOGDANKA – KEY INFORMATION

Lubelski Węgiel Bogdanka S.A. is one of the largest and most advanced hard coal mines in Poland and one of the leaders of the domestic market for power coal producers. In 2011 the production of commercial coal was 5.84 million tonnes, and after three quarters of 2012 - 6.07 million tonnes.

LW BOGDANKA conducts mining operations including extraction, cleaning and sales of hard coal. Additionally, the Company produces façade bricks in the process of utilising carboniferous rock waste stone in the EkoKLINKIER Construction Ceramics Plant.

The BOGDANKA mine supplies coal primarily to industrial customers located in the east and north-east of Poland. The customer market is stable, and the sales are carried out mainly based on long-term agreements. Key industries for LW BOGDANKA’s sales of commercial coal include professional and industrial power engineering.

The Company’s financial results, hard coal extraction capacity as well as its investment plans distinguish it from other companies operating in the industry.

.
Additional information available at: www.bogdanka.eu



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czytaj-aktualnosc/2134/lubelski-wegiel-bogdanka-s-a-after-3qs-2012/ 2012-11-07 00:00:00 2134
Around 800 Workshop Participants In October we held education meetings in 12 cities.

The second edition of a series of meetings dedicated to investing on the stock exchange is now in progress. Meetings are held throughout Poland as part of the educational programme “Civic Shareholding. Invest consciously”. In October, approximately 800 people participated in free workshops held in 12 different cities.

A record was achieved in Opole where 123 participants attended the meeting in order to find out what are the advantages of stock exchange investing.

Due to a large number of people willing to take part in an education meeting in Wrocław, an additional workshop date was scheduled for this city – 21 January 2013.

The free-of-charge workshops are run by experts from brokerage houses in different cities throughout the country. The workshops also give its participants an opportunity to consult experts from such institutions as the Polish Financial Supervision Authority and the Association of Individual Investors.
The workshops are addressed to those who are interested in investing on the stock exchange, both the beginners and the more experienced.

The series of national meetings was launched by the Ministry of State Treasury. The programme covers a total of 36 meetings held between September 2012 and January 2013 in different Polish cities.
We want to express our gratitude to all Participants and Partners so far.

 We would like to invite you to participate in the upcoming meetings and to see the gallery of photos featuring workshops held in October.
http://www.akcjonariatobywatelski.pl/portal/pl/71/Galeria.html

In order to sign in, please visit the website www.AkcjonariatObywatelski.pl or contact the Association of Individual Investors. at + 48 71 332 95 65.


November will see more workshops run throughout Poland by stock exchange practitioners:

Date
 City Organiser Venue of the meeting Time:
5 Nov. 2012
Rzeszów
KBC SecuritiesGrand Hotel Rzeszów
ul. Kościuszki 9
(parking/wjazd od
ul. Dymnickiego 1A)
35-030 Rzeszów   
4:30 p.m.
6 Nov. 2012
TarnobrzegDM BPSPaństwowa Wyższa Szkoła Zawodowa
im. prof. Stanisława Tarnowskiego w Tarnobrzegu,
ul. Sienkiewicza 50
Sala wykładowa H
4:30 p.m.
7 Nov. 2012
Zamość
DM Banku Handlowego
 C.K.H. "ALEX"
22-400 Zamośc
uL.Okrzei 32
4:30 p.m.
8 Nov. 2012
WarszawaDM BOŚ
Giełda Papierów Wartościowych w Warszawie,
ul. Książęca 4   
4:30 p.m.
12 Nov. 2012
Katowice
ING Securities
Hotel Novotel Katowice
Centrum, al. Roździeńskiego 16
4:30 p.m.
13 Nov. 2012
Jastrzębie Zdrój
DM PKO
Hotel Dąbrówka,
ul. 1 Maja 49,
Jastrzębie Zdrój
4:30 p.m.
19 Nov. 2012
Olsztyn
DM Raiffeisen Bank Polska
Warmiński Hotel & Conference
ul. Kołobrzeska 1
10-442 Olsztyn   
4:30 p.m.
20 Nov. 2012
Ostrołęka
KBC Securities
WSAP Centrum Szkoleniowe
ul. Korczaka 73
07-409 Ostrołęka
4:30 p.m.
22 Nov. 2012
Białystok
DM BGŻ
Restauracja CAMELOT
ul. Młynowa 24
4:30 p.m.
26 Nov. 2012
Bydgoszcz
DM Xelion
Szczegóły wkrótce na www.AkcjonariatObywatelski.pl
4:30 p.m.
27 Nov. 2012
Toruń
DM XTB
Mercure Toruń Centrum
ul. Kraszewskiego 1/3
4:30 p.m.



***
The series of meetings devoted to investing at the stock market is organised within the framework of the educational programme “Civic Shareholding, Informed Investing” and supported by 33 partners:
the Warsaw Stock Exchange, the National Depository for Securities, the Financial Supervision Authority, the Association of Individual Investors, the Polish Association of Listed Companies, the Chamber of Brokerage Houses, and the companies PZU, TAURON PE, Citi Handlowy, the LOTOS Group, JSW, KGHM, LW Bogdanka, PGNiG, PKN ORLEN, and PKO Bank Polski, with the cooperation of Havas, GPW Media, and the Capital Market Institute.

Stock exchange meetings throughout Poland are organised by the brokerage houses: the Brokerage Office of Alior Bank, Dom Maklerski Banku Ochrony Środowiska, Dom Maklerski BDM, the Brokerage House of Bank BGŻ, the Dom Maklerski Banku BPS, Dom Inwestycyjny BRE Banku, Dom Maklerski BZ WBK, Dom Maklerski Banku Handlowego, the Brokerage House of ING Securities, the Brokerage House of KBC Securities, the Brokerage House of PKO Bank Polski, Dom Maklerski Raiffeisen Bank Polska (Raiffeisen Brokers), Dom Inwestycyjny Xelion, X-Trade Brokers Dom Maklerski.

The internet portals Biznes.Onet.pl and Biznes.pl are the media partners.



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czytaj-aktualnosc/2136/around-800-workshop-participants/ 2012-11-02 00:00:00 2136
Ostrołęka Terminates the Agreement with Bogdanka Bogdanka Has a Firm Opinion on the Market

The Management Board of Lubelski Węgiel Bogdanka S.A. hereby announces that on 30 October 2012 it was informed about the termination of a Long-Term Agreement on power coal supplies to a power unit in Elektrownia Ostrołęka S.A. currently under construction. Under the Agreement, the supply of coal and operation of Unit C in Ostrołęka, with power of approx. 1,000 MW, were expected to commence in 2016 and remain in force for a period of 19 years.

At the same time, the Ostrołęka Power Plant requested to hold negotiations aimed at terminating the Agreement before the lapse of the 3-year termination period.

The Management Board informs you that already on the stage of preparing the provisions of the agreement for the future coal supplies, it took account of a high risk of the agreement failure, as it provided for the obligation to obtain financing for the investment.

Other long-term agreements concluded by the Company with Elektrownia Ostrołęka S.A. for coal supplies to the existing power units are being executed on an ongoing basis and without any interference.

“We held and still hold a firm opinion on the market reality. The Management Board of Bogdanka took account of the fact that not all of the planned investments in new power units may enter the implementation stage. Therefore, by securing coal sale in connection with the planned increase in exploitation, we entered into conditional agreements for coal supplies to the planned power units with entities such as Elektrownia Ostrołęka from the Energa Group, Elektrownia Północ from the Kulczyk Holding Group and Elektrownia Kozienice from the Enea Group. In the last situation mentioned, the contractor even physically entered the construction site. Nothing indicates that the construction of Elektrownia Północ may cease. The Management Board of Energa, as it stems from the public information, also has not resigned from implementing their investment, but only had frozen it until winning a strategic investor,” informs Zbigniew Stopa, the acting President of the Management Board of LW Bogdanka S.A.

“Information on withdrawal from the energetic project in Ostrołęka appeared on the market already in September 2012, so the termination of the Agreement for coal supplies that we received is only its natural consequence. By no means does it influence the plans for implementation of the Company’s development goals. Due to an increase in the exploitation effectiveness and a steady increase of our competence advantages, in a long run we are confident of sale of our coal in the Polish commercial power sector,”
adds Z. Stopa.


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czytaj-aktualnosc/2138/ostroleka-terminates-the-agreement-with-bogdanka/ 2012-10-31 00:00:00 2138
Award for LW Bogdanka S.A. We are happy to inform you that on 19 October 2012, our Company was honoured by the Polish Accounting and Tax Institute for applying the International Financial Reporting Standards in the Financial statements of GK LW Bogdanka. The award was presented during the Final Gala of the 7th Edition of Competition for the Best Annual Report 2011 (according to IFRS/IAS).

The Competition Jury justified their choice as follows:

“It is worth noticing that the consolidated statements of the Lubelski Węgiel Bogdanka Group have received high notes in this category starting from the first year it was submitted for the competition. The reporting standards, including the description of significant estimates and judgements adopted in preparation of the consolidated financial statements, were presented in a clear manner which allows understanding of the issues crucial for assessment of the Group's activity. They are adjusted to the Group’s character and completed with detailed rules, specific for its activity. The Jury appreciated especially the high quality and usefulness, from the point of view of a financial statements recipient, of the information enclosed in the notes to the consolidated financial statements. A proper selection of information makes the key data reader-friendly. As a result, the financial statements are succinct, very clear and include information which is important for assessing the Group’s financial situation.



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czytaj-aktualnosc/2140/award-for-lw-bogdanka-s-a-/ 2012-10-25 00:00:00 2140
Bogdanka’s Monthly Production Unchanged
Zbigniew Stopa, the acting President of the Management Board of LW Bogdanka S.A. says
:
“We have been keeping the production on a similar level already for several months. It is determined by geological and mining conditions under which we conduct extraction. We informed the market of these circumstances along with presenting the results for the first half of 2012.

The Company conducts simultaneously reinforcement of two next walls in the Nadrybie Field, i.e. it installs there panel complexes – one coal-cutting in wall 382 and one coal-ploughing in wall 385. Launching the latter is scheduled for the end of October. The level of our stock is decreasing from over 300,000 tonnes as at the end of June, to 100,000 at the current moment. The plans of extracting and selling commercial coal on the level of over 8 million tonnes this year will be accomplished.”

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czytaj-aktualnosc/2142/bogdanka-s-monthly-production-unchanged/ 2012-10-12 00:00:00 2142
Civic Shareholding Workshops Brought Together 400 Participants The second edition of a series of meetings dedicated to investing on the stock exchange is now in progress. Meetings are held throughout Poland as part of the educational programme “Civic Shareholding. Invest consciously”. In September alone, almost 400 people participated in free meetings held in six different cities. A record 129 participants attended a meeting in Poznań to find out what are the advantages of investing on the stock exchange.

The free-of-charge workshops are run by experts from brokerage houses in different cities throughout the country. The workshops also give its participants an opportunity to consult experts from such institutions as the Polish Financial Supervision Authority and the Association of Individual Investors.

Meetings in Kutno and Poznań were dedicated to the importance of individual investors for the capital market, and were run by Paweł Tamborski, the Undersecretary of State in the Ministry of State Treasury.
The workshops are addressed to those who are interested in investing on the stock exchange, both the beginner investors and the more experienced ones.

The series of nationwide meetings was launched by the Ministry of State Treasury. The programme covers a total of 36 meetings held between September 2012 and January 2013 in 34 Polish cities.
We invite you to participate in upcoming meetings and to see the gallery of photos featuring workshops held in September.

In order to sign in please visit the website www.AkcjonariatObywatelski.pl or contact the Association of Individual Investors at + 48 71 332 95 65.

October will see more workshops run throughout Poland by stock exchange practitioners.


Date
City
Brokerage House
Place of meeting
Hour.
01.10
Katowice
DM BDM
MAKSIMUM Sp. z o.o. HOLDING S.K.A.
ul. Opolska 22
40-084 Katowice
Sala c
16:30
02.10
Bielsko-Biała
DM BDM
Wyższa Szkoła  Finansów i Prawa
w Bielsku-Białej
ul. Czesława Tańskiego 5
43-382 Bielsko-Biała
16:30
08.10
Gdańsk
DI BRE Banku
Sala konferencyjna w siedzibie „Pracodawców Pomorza"
Ul. Zwycięstwa 24
80-219 Gdańsk
16:30
09.10
Radom
KBC Securities
Aviator Hotel
26-600 Radom
ul. Malczewskiego 18
16:30
10.10
Lublin
DM Banku Handlowego
Hotel Victoria
ul. Narutowicza 58/60
20-016 Lublin
16:30
15.10
Koszalin
DM XTB
Hotel Gromada
ul. Zwycięstwa 20-24, sala Szmaragdowa
16:30
17.10
Gorzów Wlk.
DM BZ WBK
Qubus Hotel, ul. Orląt Lwowskich 3, Sala nr 2
16:30
22.10
Jelenia Góra
BM Alior Banku
szczegóły wkrótce na www.akcjonariatobywatelski.pl
 
23.10
Lubin
DM BDM
Caprun Arena
ul Sikorskiego 20
59-300 Lubin
Poziom: 3 sala: 08
16:30
24.10
Rybnik
DM BOŚ
Uniwersytet Śląski
Ośrodek Dydaktyczny
ul. Rudzka 13c
16:30
29.10
Opole
DM PKO
Hotel Mercury
ul. Krakowska 57/59
16:30
30.10
Wrocław
DM BPS
szczegóły wkrótce na www.akcjonariatobywatelski.pl
 


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czytaj-aktualnosc/2144/civic-shareholding-workshops-brought-together-400-participants/ 2012-10-02 00:00:00 2144
Zbigniew Stopa manages the company Supervisory Board has dismissed Mirosław Taras as President of the Management Board

The company is now managed by Zbigniew Stopa

On 27 September, the Supervisory Board dismissed Mirosław Taras from the position of President of the Management Board of Lubelski Węgiel Bogdanka S.A. The decision was made on the basis of Article 25.1 of the Company’s Articles of Association. As a justification, the Supervisory Board stated that “during discussions, it turned out that the President of the Management Board does not share the view of the Supervisory Board regarding the necessity and the methods of implementing the recommendations formulated as a result of the audit”, which has been conducted at LW Bogdanka by consulting companies Ernst & Young and SRK CONSULTING (UK) Limited since the beginning of July 2012.

Under Article 25.1, the Supervisory Board has appointed Zbigniew Stopa as President of the Management Board.

Zbigniew Stopa used to be Vice-President of the Management Board for Technical Affairs. He was also the actual first deputy of the President, and in the event of his absence, he often managed the work of the Management Board.

Zbigniew Stopa was born in 1959. From the beginnings of his professional career, he has been connected with Lubelski Węgiel Bogdanka. In his career, he experienced all levels of professional development in the Company – from being a trainee underground, through the position of underground chief foreman, to Manager of the Mining Department.

From December 2006, Zbigniew Stopa was Vice-President of the Management Board of LW Bogdanka S.A. and participated actively in the processes of the company’s IPO on the WSE and implementing the strategic development goals of LW Bogdanka S.A.

In 2008, Zbigniew Stopa became General Mining Director of 2nd degree.

Zbigniew Stopa graduated in 1984 from the Faculty of Mining at the AGH University of Science and Technology with an M.Sc. Eng. degree in Mining and Geology, specialising in Deposits Exploitation Technology. In 1997, he completed postgraduate studies at the Central Mining Institute in Katowice in the field of Occupational Health and Safety Management. He has participated in numerous trainings and courses, he has also completed a course for candidates for members of Management Boards in companies wholly owned by the State Treasury.


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czytaj-aktualnosc/2146/zbigniew-stopa-manages-the-company/ 2012-09-28 00:00:00 2146
LW BOGDANKA a Member of SEG On 7 September 2012, Lubelski Węgiel BOGDANKA S.A. was accepted as a supportive member of the Polish Association of Listed Companies.

The Association, being a representative of the companies listed on the Warsaw Stock Exchange, provides knowledge and assistance to the environment of issuers with regard to regulation of the stock market, as well as rights and obligations of the participating companies. As an expert organisation, it aims at dissemination and exchange of knowledge that would enable the capital market and the modern market economy in Poland to develop. It integrates the environment of issuers and promotes cooperation for the benefit of the civil society. The basic goal of the Association’s activity is representation and protection of business of the associated companies.

Stowarzyszenie Emitentów Giełdowych

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czytaj-aktualnosc/2148/lw-bogdanka-a-member-of-seg/ 2012-09-14 00:00:00 2148
Output level of commercial coal in August 2012 In August 2012, LW Bogdanka S.A. achieved the output level of commercial coal 624,218 tonnes.
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czytaj-aktualnosc/2150/output-level-of-commercial-coal-in-august-2012/ 2012-09-13 00:00:00 2150
Stock Market Investing - Cycle of Workshops Knowledge Is an Investor’s Greatest Weapon


The day of 10 September 2012 marks the beginning of the second edition of the nationwide series of workshop meetings devoted to investing at the stock market, organised within the framework of the educational programme “Civic Shareholding, Informed Investing”. LW Bogdanka S.A. is a proud partner of the meetings.

Already on 10 September, the series of workshops devoted to investing at the stock market will be inaugurated with a meeting in Kutno. The educational programme is aimed at individual stock investors.  Persons who take their first steps at the stock market, as well as investors of greater experience will learn during the gratuitous meetings how to manage personal savings consciously. They will get to know the structure of the Polish capital market and learn to exercise the rights granted to shareholders of a listed company. The workshops are really accessible and practical. Each participant receives useful educational materials and takes part in various contests with prizes.

In total, experts from 14 brokerage houses are set to visit 34 cities and towns in Poland until January 2013. Apart from them, the meetings will be attended also by specialists from the Association of Individual Investors and the Financial Supervision Authority, as well as other representatives of institutions and listed companies which are the partners of the Civic Shareholding programme.

In September, meetings in the following Polish cities are scheduled:


 Date

City
Venue of the meeting
 Time
10.09
Kutno
Dom Dochodowy Straży Pożarnej
ul. Teatralna 1, 99-320 Kutno

 16:30
11.09Łódź

Uniwersytet Łódzki, Wydział Zarządzania,
ul. Matejki 22/26, sala 206, II piętro

 16:30
13.09
Tarnów

Teatr Tarnów,
ul. Adama Mickiewicza 4

 16:00
17.09 Siedlce
Hotel „Janusz”,
ul. Pusta 15, 08-110 Siedlce

 16:00
24.09Gdynia
Hotel Kuracyjny,
Al. Zwycięstwa 255

 16:30
28.09
Poznań
Wielkopolski Urząd Wojewódzki
al. Niepodległości 16/18

 16:30




Applications for a gratuitous meeting devoted to investing at the stock market can be submitted at www.AkcjonariatObywatelski.pl, where also the full schedule of meetings can be found, as well as at the Association of Individual Investors under telephone number (71) 332 95 65.

Detailed information on meeting organisation is provided by:
Natalia Porębska
the Association of Individual Investors
nporebska@sii.org.pl
tel. (71) 332 95 65

The Ministry of Treasury’s activities have the support of 33 partners:

the Warsaw Stock Exchange, the National Depository for Securities, the Financial Supervision Authority, the Association of Individual Investors, the Polish Association of Listed Companies, the Chamber of Brokerage Houses, and the companies PZU, TAURON PE, Citi Handlowy, the LOTOS Group, JSW, KGHM, LW Bogdanka, PGNiG, PKN ORLEN, and PKO Bank Polski, with the cooperation of Euro RSCD, GPW Media, and Instytut Rynku Kapitałowego – WSE Research S.A.

Stock exchange meetings throughout Poland are organised by the brokerage houses: the Brokerage Office of Alior Bank, Dom Maklerski Banku Ochrony Środowiska, Dom Maklerski BDM, the Brokerage House of Bank BGŻ, the Dom Maklerski Banku BPS, Dom Inwestycyjny BRE Banku, Dom Maklerski BZ WBK, Dom Maklerski Banku Handlowego, the Brokerage House of ING Securities, the Brokerage House of KBC Securities, the Brokerage House of PKO Bank Polski, Dom Maklerski Raiffeisen Bank Polska (Raiffeisen Brokers), Dom Inwestycyjny Xelion, X-Trade Brokers Dom Maklerski.

The internet portals Biznes.Onet.pl and Biznes.pl are the media partners.
ao_logo_460


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czytaj-aktualnosc/2152/stock-market-investing-cycle-of-workshops/ 2012-09-04 00:00:00 2152
LUBELSKI WĘGIEL BOGDANKA S.A. after the first half of 2012 PRESS RELEASE
Bogdanka, 29 August 2012


LUBELSKI WĘGIEL BOGDANKA S.A. AFTER THE FIRST HALF OF 2012:

A Three Digit Increase in EBITDA, EBIT and Net Profit
EBITDA margin: 40.30 %


Lubelski Węgiel BOGDANKA S.A., the most modern and effective hard coal mine in Poland, as well as the domestic leader on the energy coal producers market, generated in the first half of 2012 over PLN 906 million revenue, almost 56% more than in the same period in 2011. The consolidated operating profit amounted to PLN 212.82 million and the Group’s net profit reached PLN 173.25 million. These values are higher by 202.26% and 178.7%, respectively, than in the first half of 2011. During six months of 2012, the production of commercial coal, as compared to the same period of the previous year, increased by 64.52% and amounted 4,175,060 tonnes (2,537,680 in the previous year).

The main source of sales revenue for the LW BOGDANKA Group in the first half of 2012 (as well as in the first half of 2011) was production and sale of power coal. From 1 January to 30 June 2012, sales of power coal generated 96.87% of the LW BOGDANKA Group's sales revenue (92.13% in the same period of the previous year). The increase in the revenue on sales of coal is a consequence of higher volumes of coal sold (+45.94%), with a higher sale unit price.

Over 74% of coal sales (in terms of value) realised in the period from 1 January to 30 June 2012 were carried out on the basis of long-term commercial agreements concluded between LW BOGDANKA and Elektrownia Kozienice S.A., GDF Suez Energia S.A., Elektrownia Ostrołęka S.A. and Grupa Ożarów. A drop in the share of key customers in the total value of revenue (in Q1 2011 the above power plants generated more than 85% of revenue of the LW BOGDANKA Group) is a consequence of diversification of sales to smaller customers (due to additional volume of commercial coal available).

FINANCIAL RESULTS - DETAILS

Item [PLN '000] 
Q2
2012
Q2
2011
Change
[%]
2012/2011
2Qs
2012
2Qs
2011
Change
[%]
2012/2011
Revenue on sales 429 236 272 120 57.74 906 538 582 081
 55.74
Gross profit  125 516
 48 798 157.22
 301 445 121 616 147.87
EBITDA
 166 297 67 279
 147.18 365 343 145 185  151.64
EBIT (Operating profit)   93 518
 26 711 250.11 212 815
 70 409 202.26
Profit before taxation 89 655 32 194 178.48
 213 35877 029
 176.98
Net profit  74 037
 26 205
 182.53  173 247 
  62 163
  178.70


The Lubelski Węgiel BOGDANKA S.A. Group's revenue on sales amounted to PLN 906,538,000, which represents an increase of 55.74%, or by PLN 324,457,000, as compared to the same period of the previous year.

In the second quarter of 2012, the Group’s revenue on sales amounted to PLN 429,236,000, compared to PLN 272,120,000 in the analogous period of 2011 (increase by 57.74%, i.e. PLN 157,116,000).

The Group’s operating profit grew from PLN 70,409,000 (for H1 2011) to PLN 212,815,000 (for H1 2012), with the year-to-year change of + PLN 142,406,000, i.e. 202.26%.

The value of EBITDA (operating profit before depreciation/amortisation) for the period from 1 January to 30 June 2012 amounted to PLN 365,343,000 compared to PLN 145,185,000 in the same period of 2011. The increase in the operating profit derives from the launch of the Stefanów Field (in October 2011), and in consequence, an additional volume of coal allocated for sale. The second quarter itself saw an increase in the operating profit from PLN 26,711,000 (Q2 2011) to PLN 93,518,000 (Q2 2012).

The net profit for the first half of 2012 amounted to PLN 173,247,000, compared to PLN 62,163,000 for the same period of 2011, which represents an increase by 178.70%, i.e. by PLN 111,084,000.

In the second quarter of 2012 the LW BOGDANKA Group generated net profit in the amount of PLN 74,037,000, as compared to PLN 26,205,000 in the second quarter of 2011 (an increase by 182.53%).



PROFITABILITY RATIOS OF THE LW BOGDANKA GROUP

Item 
 2Qs
2012
2Qs
2011
Change
[p.p.]
2012-2011
Change
[%]
(2012/2011)
Gross margin on sales 33.25% 20.89%  12.36 59.17
EBITDA 40.30% 24.94%
 15.36 61.59
EBIT
 23.48% 12.10%
 11.38 94.05
Gross margin  23.54%  13.23% 10.31
 77.93
Net margin 
 19.11% 10.68%  8.43 78.93
Return on Assets 5.35% 2.18%
 3.17 145.41
Return on Equity
 8.02%
  3.15%
 4.87 154.60

During the first quarter of 2012, all profitability ratios achieved higher values than in the same period of the previous year.

Gross margin on sales of the LW BOGDANKA Group increased from 20.89% (for the first half of 2011) to 33.25% (for the first half of 2012). The change in value of that ratio, was a result of a lower (in nominal terms) increase in the generated revenue in relation to the incurred costs of products, goods and materials – this also translated into an increased gross profit.

In the analysed period, EBIT (operating profit) was 23.48%, which represents an increase by 11.38 p.p. in comparison to the same period in the previous year. The change in value of the described ratio results from an increase in the gross profit which is realised by an increase in revenue on sales of coal of the Parent Undertaking.

EBITDA was up from 24.94% (first half of 2011) to 40.30% (first half of 2012). The change in value of the ratio results from – except for the increasing operating profit – the value of amortisation/depreciation increasing from PLN 74,776,000 (first half of 2011) to PLN 152,528,000 (first half of 2012).

Gross margin for the first half of 2012 amounted to 23.54% and was higher than the gross profitability for the first half of 2011 (by 10.31 p.p.).

Net margin on the Lubelski Węgiel Bogdanka S.A. Group's operations amounted to 19.11% for the first half of 2012, compared to 10.68% for the first half of 2011.

The increase in ROA (from 2.18% for the first half of 2011 to 5.35% for the first half of 2012) is a consequence of a higher dynamics of the net profit relative to the increase in the value of the Group’s assets. The effects of commercial use of assets that have been so far produced by the Parent Undertaking are already noticeable.

COAL PRODUCTION AND SALES

During the first 6 months of 2012, the revenue on sales generated by the LW BOGDANKA Group resulted from coal supply orders under agreements signed by the Parent Undertaking.

Net coal production of the LW BOGDANKA Group for H1 2012 and H1 2011 ('000 tonnes)

H1 2012
H1 2011
Change (2012/2011)
[%]
 4,175.06  2,537.68
 64.52


From 1 January to 30 June 2012, as compared to the same period of 2011, the production of commercial coal increased by 64.52% and amounted to 4,175,060 tonnes, (2,537,680 tonnes in the previous year). The increase in the extraction of the commercial coal by nearly 65% occurred together with an increase by almost 46% of gross extraction, which means that in the first half of 2012 the Parent Undertaking recorded a higher output ratio than in the analogous period of the previous year.

Sale of coal of the LW BOGDANKA Group for H1 2012 and H1 2011 ('000 tonnes)

H1 2012
 H1 2011
Change (2012/2011)
[%]
 3,881.41 2,659.57 45.94%

From 1 January to 30 June 2012, 45.94% (1,221,840 tonnes) more coal was sold as compared to the analogous period of the previous year. In the first half of 2012, the sale of the commercial coal was in line with plans and agreements signed by the Parent Undertaking.

Stock of coal ['000 tonnes]

Item 
30 Jun. 2012 
31 Dec. 2011 
30 Jun. 2011
 Change [%]
(30 Jun. 2012/
31 Dec. 2011)
  Change [%]
(30 Jun. 2012/
30 Jun. 2011)
 Stock of coal
 321.44
27.85
 14.84 1,054.16% 2,066.18%


As at 30 June 2012 stock of commercial coal of the Parent Undertaking amounted to 321,443.14 tonnes, which means that the level of stock increased by 293,592.30 tonnes (+1,054.16%) as compared to the level of 31 December 2011, and by 306,603.96 tonnes (+2,066.18%) compared to the level of 30 June 2011. The current level of stock results from a delivery schedule specified on the basis of agreements with recipients of coal. It approximately corresponds to a twelve-day output of commercial coal, and constitutes operational technological stock.

Mirosław Taras, President of the Management Board of LW Bogdanka S.A.:

“It is hard to hide satisfaction while presenting the Company’s results for the first half of 2012. Especially that Bogdanka represents a business which does not enjoy favourable reputation in Poland. Especially that the three digit dynamics of operational profit growth and net profit is not “hyped” by a single event, but is a result of effective accomplishment of our strategic goals.

Bogdanka developed its business model with the use of solutions that enable maintaining cost discipline. This business model gained recognition and confidence of the capital market participants, and still has been consistently carried out. By increasing, in accordance with the forecasts, the production, we decrease, due to the scale effect, the unit costs of coal production. This is why our Company, in many opinions, is perceived to be a predictable and well organised business. I can guarantee that we will do everything to multiply such opinions.”


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czytaj-aktualnosc/2154/lubelski-wegiel-bogdanka-s-a-after-the-first-half-of-2012/ 2012-08-29 00:00:00 2154
Bogdanka - a Partner to the Civic Shareholding. Knowledge Is an Investor’s Greatest Weapon

The second edition of the educational campaign “Civic Shareholding. Informed Investing” (“Akcjonariat Obywatelski. Inwestuj świadomie”) is launching. The Ministry of Treasury initiates a nationwide educational programme aimed at individual stock exchange investors. They will be invited to participate in free workshops conducted by professionals throughout Poland and make use of on-line knowledge repositories in the new version of the portal www.AkcjonariatObywatelski.pl. The new edition of the programme has secured the participation of a record number of 33 partners: stock exchange companies, financial market institutions, and brokerage houses.

The programme “Civic Shareholding. Informed Investing” is meant to build social trust towards the capital market and to increase the involvement of individual investors at the Warsaw Stock Exchange.
Mikołaj Budzanowski, Minister of Treasury, said:
“We want Poles to have full awareness when making investment choices, to possess the knowledge on the workings of the capital market, especially during periods of dynamic shifts on the stock exchange. Knowledge is an investor’s greatest weapon and it may protect them against risks related to the placement of their savings.”

One of the key initiatives carried out as part of this year's edition of the programme is a series of workshop meetings devoted to investing at the stock exchange. Both persons new to stock exchange investing and experienced investors can participate in free meetings with experts, trainings, and practical workshops where they will learn the opportunities provided by the capital market. Participants will be taught to manage their savings in an informed fashion. They will get to know the structure of the Polish capital market and learn to exercise the rights granted to shareholders of a listed company. In total, experts from 14 brokerage houses are set to visit 34 cities and towns in Poland from September 2012 to January 2013.

Registration for the meetings takes place via the www.AkcjonariatObywatelski.pl website, which also hosts the meetings schedule.

Under the “Civic Shareholding. Informed Investing” programme, the www.AkcjonariatObywatelski.pl website has been modernised. The portal has been enhanced with new material, such as stock exchange simulations or a timetable featuring information on valuable meetings, workshops, and conferences devoted to the stock exchange. “Civic Shareholding” is also present on YouTube and Facebook.

The Ministry of Treasury’s activities have the support of 33 partners:

the Warsaw Stock Exchange, the National Depository for Securities, the Financial Supervision Authority, the Association of Individual Investors, the Polish Association of Listed Companies, the Chamber of Brokerage Houses, and the companies PZU, TAURON PE, Citi Handlowy, the LOTOS Group, JSW, KGHM, LW Bogdanka, PGNiG, PKN ORLEN, and PKO Bank Polski, with the cooperation of Euro RSCD, GPW Media, and Instytut Rynku Kapitałowego – WSE Research S.A. Media partners: Biznes.Onet.pl, Biznes.pl.

Stock exchange meetings throughout Poland are organised by the brokerage houses: the Brokerage Office of Alior Bank, Dom Maklerski Banku Ochrony Środowiska, Dom Maklerski BDM, the Brokerage House of Bank BGŻ, the Dom Maklerski Banku BPS, Dom Inwestycyjny BRE Banku, Dom Maklerski BZ WBK, Dom Maklerski Banku Handlowego, the Brokerage House of ING Securities, the Brokerage House of KBC Securities, the Brokerage House of PKO Bank Polski, Dom Maklerski Raiffeisen Bank Polska (Raiffeisen Brokers), Dom Inwestycyjny Xelion, X-Trade Brokers Dom Maklerski.


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czytaj-aktualnosc/2156/bogdanka-a-partner-to-the-civic-shareholding-/ 2012-08-27 00:00:00 2156
Development Prospects Unchanged Announcement by the Management Board of Lubelski Węgiel BOGDANKA S.A.

Bogdanka’s Potential Secures Long Term Perspectives for its Development

In relation to a release, published on 9 August 2012 by Prairie Downs Metals Limited (Prairie), an Australian Securities Exchange (ASX) listed company, announcing that “Prairie Downs Secures a Large Coal Project in Poland”, as well as announcing the granting, by the Polish Ministry of the Environment, of hard coal exploration licenses within the areas of Kulik, Syczyn, Kopina and Cyców, i.e. in a direct vicinity of the extraction activity of Lubelski Węgiel Bogdanka S.A. The Management Board hereby declares that the measures undertaken by the above company do not restrict or affect the pursuance of Bogdanka’s strategic goals and long-term development plans.
Following its analysis of the release, the Management Board points that the release refers to the hard coal exploration license granted for three years and obliging that specified measures be taken in that period.

The LW Bogdanka S.A.’s Management Board believes, based on information held, its knowledge and experience in mining and geology, that commercial likelihood of completing of the described Prairie’s project, as well as that of any other entity, involving future transformation of the licence for resource exploration into a resource excavation (mining) licence and constructing a mine, is practically close to zero.

Technical and economic obstacles will always include the lack of independent and necessary transport and energy infrastructure on the areas referred to above.

The only entity that owns such infrastructure and has necessary knowledge and experience with respect to the use of the described seams is LW Bogdanka. Further, it is the sole entity – as compared to other greenfield investors – that may guarantee a significantly lower cost of access to the resources.

It is beyond the Company’s control to whom the exploration licences are granted (they have already been granted to Kompania Węglowa, Prairie Downs Metals Limited and others) or will possibly be granted in future, by the authorised government bodies. Moreover, it is the state that owns all natural resources and pursues its own policy of making them available for the purposes of exploration and use. In each case however, the economic efficiency of undertaken projects is verified by the market reality.

Lubelski Węgiel Bogdanka is deeply involved in the procedure for obtaining a mining licence in the adjacent areas in compliance with binding Polish regulations. Due to the high degree of work progress combined with its potential and assets held, the Company can safely compete with each entity planning coal mining in the Lublin region.

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czytaj-aktualnosc/2158/development-prospects-unchanged/ 2012-08-24 00:00:00 2158
Conclusion of an annex to the significant agreement with PH-U Energokrak Sp. z o.o. with registered office in Krakow The Company hereby announces that on 1 August 2012 it concluded an annex to the Long-Term Agreement on the sale of power coal 19 July 2011 with Przedsiębiorstwo Handlowo – Usługowe Energokrak Sp. z o.o., which entirely changes the contents of the said Agreement. The Agreement was described in Current Report No. 21/2011 of 19 July 2011.

As a result of the Annex conclusion, the coal supplies may be made to the Customers from the EDF Group. Moreover, the quantitative volumes of deliveries to the Customer will be increased.

As a result of the Annex conclusion, the Agreement is in effect from 19 July 2011 until 31 December 2015. The Parties have also agreed that it will be possible to renew the Agreement for successive years.

As a result of the Annex conclusion, the value of the Agreement increases (without regard to possible increases, deviations and tolerance) from PLN 393,000,000 net to an estimated amount of PLN 621,000,000 net according to current prices.


More information is available here.

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czytaj-aktualnosc/2160/conclusion-of-an-annex-to-the-significant-agreement-with-ph-u-energokrak-sp-z-o-o-with-registered-office-in-krakow/ 2012-08-02 00:00:00 2160
Output level of commercial coal in July 2012 In July 2012, LW Bogdanka S.A. achieved the output level of commercial coal 649,878 tonnes.
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czytaj-aktualnosc/2162/output-level-of-commercial-coal-in-july-2012/ 2012-08-02 00:00:00 2162
Bogdanka Included in the Respect Index On 31 July 2012, the Warsaw Stock Exchange yet again nominated new laureates of the prestigious RESPECT Index Rating. This time 20 listed companies were included to the composition of the new index. It was the 4 time for Lubelski Węgiel Bogdanka S.A. to be qualified to this group.

Publication of the new index will begin on 1 August 2012.
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czytaj-aktualnosc/2164/bogdanka-included-in-the-respect-index/ 2012-08-01 00:00:00 2164
Integrated Management System Certificates for Bogdanka The 19th of July 2012 saw a ceremony of granting certificates for successful implementation of an integrated management system in the area of Health and Safety, Quality and Environment (DGA Process and DGA Quality) to LW Bogdanka, the Lublin-based mining company. Ms Anna Gerymska, Head of the Bureau for Certification and Compliance Assessment, handed over the Certificates to the representatives of LW Bogdanka’s Management Board. The ceremony was also attended by representatives of the Lublin Branch of the Office of Technical Inspection (UDT) as well as the persons in charge of the Integrated Management System at Lubelski Węgiel Bogdanka S.A.
 
Before the certificates could be granted, a number of steps had to be taken to ascertain that LW Bogdanka meets all the criteria applicable to the areas subject to certification. The company has operated a quality and environmental management system for years (ISO 9001 and ISO 14001). Its expansion required help from professional advisers. In July 2011, LW Bodganka entered into an agreement with DGA S.A. of Poznań for the design and implementation of a health and safety management system compliant with the OHSAS 18001 and PN-N 18001 standards, as well as the integration of that system with the quality and environmental management system currently operated by the Company. The contractor also implemented an IT solution (software) to support paperwork connected with the Integrated Management System for Health and Safety, Quality and Environment (DGA Process and DGA Quality). The Event Process Chain notation was adopted as the method for business process modelling. In line with the project implementation schedule, the business processes were mapped using the application supplied by DGA S.A. All processes for organisation management were divided into three categories: basic, systemic and support processes. Subsequently, relevant procedures were developed. Process owners were appointed and internal auditors selected from among the employees. As soon as the system had been implemented and internal audits completed, the Company chose UDT-CERT as the authority competent for certifying standardised management systems. In the period 22-25 May, a team of eight auditors of UDT-CERT performed a certification audit. As of 1 June 2012 Lubelski Węgiel Bogdanka S.A. was awarded a certificate for a successful implementation and operation of:

•  A Health and Safety Management System compliant with the British Standard BS OHSAS 18001:2007,
• An Integrated Management System compliant with the following standards: PN-EN ISO 9001:2009, PN-EN ISO 14001:2005, and PN-N-18001:2004

The certificates cover mining, production and sale of commercial coal, as well as manufacture and sale of construction materials.


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czytaj-aktualnosc/2166/integrated-management-system-certificates-for-bogdanka/ 2012-07-20 00:00:00 2166
Conclusion of a significant agreement with Elektrownia Połaniec S.A. – the GDF SUEZ ENERGIA POLSKA Group The Company hereby informs you that on 12 July 2012 it concluded Agreement No. 3/W/2012 on the sale of power coal with Elektrownia Połaniec S.A. — Grupa GDF SUEZ ENERGIA POLSKA.

The Agreement is in effect from the date of conclusion thereof until 31 December 2018, and provides for actual supplies of power coal for the purposes of Elektrownia Połaniec in the years from 2013 to 2018. 
The Agreement between the Parties stipulates that the pricing formula is in effect until 31 December 2015. 

The value of the Agreement amounts to approx. PLN 2.857 billion net, excluding possible increases or deviations provided for under the Agreement. 

More information is available here.

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czytaj-aktualnosc/2168/conclusion-of-a-significant-agreement-with-elektrownia-polaniec-s-a-the-gdf-suez-energia-polska-group/ 2012-07-12 00:00:00 2168
Output level of commercial coal in June 2012 In June 2012, LW Bogdanka S.A. achieved the output level of commercial coal 656 396 tonnes.
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czytaj-aktualnosc/2170/output-level-of-commercial-coal-in-june-2012/ 2012-07-03 00:00:00 2170
Changes introduced to the agenda of the Annual General Shareholders Meeting Otwarty Fundusz Emerytalny PZU “Złota Jesień”, for entering the following point in the agenda of the Extraordinary General Shareholders Meeting convened for 28 June 2012:
“Adopting a resolution on determining the rules and amounts of remuneration for the members of the Supervisory Board”.

Draft resolution, the shareholder’s request and other information about the Extraordinary General Shareholders Meeting are available at the website of the Company: Investor Relations/ General Shareholders Meeting tab.
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czytaj-aktualnosc/2172/changes-introduced-to-the-agenda-of-the-annual-general-shareholders-meeting/ 2012-06-12 00:00:00 2172
Output level of commercial coal in May 2012 ]]> czytaj-aktualnosc/2176/output-level-of-commercial-coal-in-may-2012/ 2012-06-04 00:00:00 2176 Convening the Extraordinary General Shareholders Meeting of LW Bogdanka S.A. The Management Board of Lubelski Węgiel Bogdanka S.A. with registered office in Bogdanka (the “Company”), acting under Article 398 of the Commercial Companies Code, and under Article 44.3.1 of the Company’s Articles of Association, hereby convenes the Extraordinary General Shareholders Meeting of Lubelski Węgiel Bogdanka S.A. in Bogdanka, to be held on 28 June 2012 at 1.00 pm, on Warsaw Stock Exchange premises, Trading Room 4 Książęca street, Warsaw.

full text of documentation draft resolutions are available at the official website of the Company, in the corporate section, Investors Relations/General Shareholders Meeting tab.

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czytaj-aktualnosc/2174/convening-the-extraordinary-general-shareholders-meeting-of-lw-bogdanka-s-a-/ 2012-06-04 00:00:00 2174
LUBELSKI WĘGIEL BOGDANKA S.A. after the first quarter of 2012
Bogdanka, 9 May 2012


LUBELSKI WĘGIEL BOGDANKA S.A. AFTER THE FIRST QUARTER OF 2012:
Tangible Effects of Consistent Investments
High Growth Dynamics of Results 1Q2012/1Q2011


Lubelski Węgiel BOGDANKA S.A., the most modern and effective hard coal mine in Poland, as well as the domestic leader on the energy coal producers market, generated in the first quarter of 2012 over PLN 477 million revenue, almost 54% more than in the same period in 2011. The consolidated operating profit amounted almost to PLN 119.30 million and the Group’s net profit reached PLN 99.21 million. The operating results for the last quarter were influenced by the launch of mining operations in the Stefanów Field (October 2011) and by an increase in volume of coal allocated for sale (compared to the same quarter of 2011).

The Company’s main strategic goal is to reach the planned level of annual extraction – approx. 11.5 million tonnes of coal in 2014. The Company consistently implements the investment programme which leads to reaching the planned goals.

Production capacity of the LW BOGDANKA Group (‘000 tonnes)
1Q2012
1Q2011
Change
 2012/2011
[%]
 2 180,64 1 322,30 64.91%


During the period from 1 January to 31 March 2012, as compared to the analogous period of 2011, the extraction of commercial coal increased by 64.91% and amounted to 2,180,640 tonnes, (in the previous year it was 1,322,300 tonnes). The increase in commercial coal extraction by almost 65% occurred with an increase of gross extraction by less than 50%. It means that in the first quarter of 2012 LW Bogdanka S.A. recorded, in general, an output ratio higher than in the analogous period in the previous year.

FINANCIAL RESULTS - DETAILS


Item
 1Q 20121Q 2011
Change
2012/2011
[%]
Revenue on sales 477 302309 961 53.99%
Zysk brutto 175 92972 818
 141.60%
EBITDA 199 046 77 906 155.50%
EBIT (Operating profit) 119 297 43 698 173.00%
Profit before taxation 123 703 44 835 175.91%
Net profit
 99 210 35 958 175.91%
Operating cash flow
 202 734 77 562 161.38%
Investing cash flow
 -138 662 -189 062 -26.66%
Financing cash flow
 50 000 -3 000 -


During the first quarter of 2012, the Lubelski Węgiel BOGDANKA Group's revenue on sales was PLN 477,302,000, which represents an increase of 53.99%, or by PLN 167,341,000, compared to the same period of the previous year.

The Group’s operating profit increased from PLN 43,698,000 (for Q1 2011) to PLN 119,297,000 (for Q1 2012) - a change of PLN +75,599,000 i.e. by 173% on a year-to-year basis. EBITDA (operating profit before depreciation/amortisation) for the period from 1 January to 31 March 2012 amounted to PLN 199,046,000 compared to PLN 77,906,000 in the same period of 2011. The increase in the operating profit is a result of launching mining operations in the Stefanów Field (October 2011) and of an additional amount of coal dedicated for sale.

The net profit for the first quarter of 2012 was PLN 99,210,000, compared to PLN 35,958,000 for the same period of 2011, which represents an increase by 175.91%, or by PLN 63,252,000.

In the first quarter of 2012, the Group financed its activities with operating cash flow and cash accumulated in the previous years. The net operating cash flow increased from PLN 77,562,000 (for Q1 2011) to PLN 202,734,000 (for Q1 2012), mainly due to the increase in the coal sale volume.

The net investing cash flows for the period from 1 January to 31 March 2012 amounted to PLN 138,662,000 and were lower than in the analogous period in 2011 by PLN 50,400,000. The Company continues to pursue the investment process, however the scope of the related work in individual quarters under analysis was different, hence the lower value of net cash flows in 2012.

In the period from January to March 2012, the Group generated positive net financing cash flow of PLN 50,000,000 (the third tranche, out of four tranches available from a mid-term working loan at PEKAO S.A., was used).

Profitability ratios of the LW BOGDANKA Group

Item
1Q
2012
1Q
2011

Change
 [p.p.]
 2012-2011
Change
(2012/2011)
[%]
Gross margin on sales 36.86%23.49% 13.37 56.92%
Rentowność EBITDA 41.70%25.13% 16.57 65.94%
Rentowność EBIT 24.99%14.10% 10.89 77.23%
Gross margin 25.92%
 14.46% 
 11.46
 79.25%
Net margin 20.79% 11.60% 9.19 79.22%
Return on Assets 3.13% 1.26% 1.87 148.41%
Return on Equity 4.53% 1.81%2.72 150.28%



During the first quarter of 2012, all profitability ratios achieved higher values than in the same period of the previous year.

Gross margin on sales of the LW BOGDANKA Group increased from 23.49% (Q1 2011) to 36.86% (Q1 2012). The change in value of that ratio was affected by higher (in nominal terms) increase in the generated revenue in relation to the incurred costs of sold products, goods and materials – this also translated into an increased gross profit.

In the analysed period, EBIT (operating profit) amounted to 24.99%, which means an increase by 10.89 p.p. in comparison to the analogous period in the previous year. An increase in gross profit, which is realised through an increase in the Company’s coal sales revenue, is responsible for the change in value of the described ratio.

EBITDA increased from 25.13% (Q1 2011) to 41.70% (Q1 2012). In addition to the growing operating result, the amortisation/depreciation value, growing from PLN 34,208,000 (Q1 2011) to PLN 79,749,000 (Q1 2012), also contributes to the change in the ratio value.

The gross margin for the first quarter of 2012 amounted to 25.92% and was by 11.46 p.p. higher than the gross margin for the first quarter of 2011.

Net margin on the Lubelski Węgiel Bogdanka S.A. Group's operations amounted to 20.79% for the first quarter of 2012, compared to 11.60% for the first quarter of 2011.

The increase in return of assets (from 1.26% for Q1 2011 to 3.13% for Q1 2012) is a consequence of a higher dynamics of the net profit, as compared to the increase of the Company’s assets’ value. The effects of commercial use of assets that have been so far produced by the Company are already noticeable.

Structure by type of revenue on sales of the LW BOGDANKA Group:
Item
[PLN '000]
 1Q2012Share
[%]
 1Q2011Share
[%]
Sales of coal 462 340
96.87% 
 289 138 93.28%
Sales of ceramics
 1 889
 0.39% 2 039 0.66%
Other activities10 392
 2.18% 12 704 4.10%
Sales of goods and materials
 2 681
 0.56% 6 080 1.96%
Total revenue on sales
 477 302
 100.00% 309 961
 100.00%



The main source of sales revenue for the LW BOGDANKA Group in the first quarter of 2012 (as well as in the first quarter of 2011) was the production and sale of power coal. From 1 January to 31 March 2012, this activity generated 96.87% of the LW BOGDANKA Group's sales revenue (93.28% in the same period of the previous year). The increase in the revenue on sales of coal is a consequence of higher volumes of coal sold (+44.42%), with only slightly higher sale unit price.

Above 75% of coal sales (in terms of value) realised in the period from 1 January to 31 March 2012 were carried out on the basis of long–term commercial agreements concluded between LW BOGDANKA and Elektrownia Kozienice S.A., GDF Suez Energia S.A., Elektrownia Ostrołęka S.A. and Grupa Ożarów. A drop in the share of key customers in the total value of revenue (in Q1 2011 the above power plants generated more than 80% of revenue of the LW BOGDANKA Group) is a consequence of diversification of sales to smaller customers (due to additional volume of commercial coal available).

Bogdanka is a mining company – producer of coal for the purposes of the commercial power sector. In the first quarter of the current year, we had results of an impressive growth dynamics, compared to the same period of the previous year. This is not an effect of some kind of extraordinary market economic situation. This is a result of a consistent implementation of our development strategy. A year ago, the Company carried a technical, organisational and financial burden of the conducted investments. Today, we derive tangible results of that process. Effective extraction means also mastering the changing geological and mining conditions. Continuation of the preparatory and development works, a specified regime of the technological process and a constant search of innovative solutions. We will be consistent within this matter. By increasing our competitive advantages, we would like to ensure a permanent growth of the Company’s value for the shareholders,” Mirosław Taras, President of the Management Board of LW Bogdanka S.A.


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czytaj-aktualnosc/2178/lubelski-wegiel-bogdanka-s-a-after-the-first-quarter-of-2012/ 2012-05-09 00:00:00 2178
Output level of commercial coal in April 2012 ]]> czytaj-aktualnosc/2180/output-level-of-commercial-coal-in-april-2012/ 2012-05-04 00:00:00 2180 Annual General Shareholders Meeting 2012 The Annual General Shareholders Meeting of LW Bogdanka S.A. was held on 27 April 2012. The resolutions adopted by the shareholders included amendments to the Company’s Articles of Association, approval of the financial statements and the directors' report on operations, distribution of net profit for 2011, granting discharge to the members of the Management and the Supervisory Boards, as well as appointment of new members of the Supervisory Board.

Please feel free to view the documentation of the Annual General Shareholders Meeting and the adopted resolutions.



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czytaj-aktualnosc/2182/annual-general-shareholders-meeting-2012/ 2012-04-30 00:00:00 2182