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Preliminary results of LW Bogdanka for q1 2018 under pressure of technical difficulties

LW BOGDANKA S.A. has announced published preliminary financial results for the first quarter of 2018. 

Separate revenue for this period amounted to PLN 397.9 million, EBITDA – PLN 122.3 million, operating profit – PLN 25.6 million, and net profit – PLN 20.9 million. The results were visibly lower than a year before, when the Company’s sales stood at a level of PLN 463.4 million, EBITDA – PLN 179.82 million, operating profit – PLN 84.5 million, and net profit – PLN 64.1 million. The results were weakened by factors of geological and hydrogeological nature resulting in temporarily lower yield ratio, and in consequence – lower production and sales.

The production of commercial coal in the period between January and March of 2018 was nearly 2.1 million tonnes compared to 2.4 million tonnes in the analogous period of the last year. The sales of coal arrived at 2.0 million tonnes, compared to 2.4 million tonnes a year before.

The drop in production and in consequence worse results on the year-on-year basis were caused by factors of geological and hydrogeological nature in one of the walls (problems with retaining the roof and leaking water). As a result the wall efficiency was lower than it would be in normal conditions – we were informed by Artur Wasil, the President of the Management Board of LW Bogdanka S.A.

The problem was temporary. We have overcome the difficulties and in March the production was pursued as per the plan. The backlog of the first quarter will be made up for in further periods. We sustain our declared production plan for the whole 2018 at a level not lower than 9 million tonnes, the President added.

In relation to the abovementioned difficulties from the first three months the yield was 57%, compared to 66.7% a year before in the same period.

On the other hand, the Q1 2018 financial result was positively influenced by a settlement achieved between the Company and the consortium of Mostostal Warszawa and Acciona Infraestructuras. A positive effect of the net result was approx. PLN 25.4 million.

Final results of LW Bogdanka will be presented in a quarterly report to be published on 24 May 2018.