This report is dated 28th Aug. It was before they announced...

This report is dated 28th Aug. It was before they announced annual result. Here is their comments after the results. They don't like ,(directors are mining our money via this company in my view.)

"CCC is spending around 40% of its revenues on administration expenses which is substantially higher than accepted for a company of this size."



SUBJECT: Gross profit in line but US$30m of exceptionals widen loss

SUMMARY: This morning Continental Coal reported FY/12 results with gross profit of A$15.5m vs our expectations of A$15.7m. However it reported a net loss of A$48m, significantly lower than our estimates of a loss of US$7m, due to US$20m of impairment charges and US$10.4m of additional royalty expenses. The company is spending close to A$30m every year in administration and other expenses.

While the company is performing ok operationally despite low coal prices the significantly higher than expected other costs are disappointing. CCC is spending around 40% of its revenues on administration expenses which is substantially higher than accepted for a company of this size.

DETAILS:

· FY/12 results

o Revenue of A$82m vs GMPe of A$83.6m

o Gross profit of A$15.5m vs our expectations of A$15.7m

o Administration expenses substantially higher and more than double our estimate of A$8m.

o CCC has accounted for a A19.8m impairment loss arising from revaluation of lower resources at Project X, Vaalbank and Lemoenfontein.

o It has also recorded an additional royalty expense of A$10.4m which was treated as a contingent liability at the end of FY/11 in relation to US$1/t of coal produced at its South African operations, capped at 15Mt. The royalty has been completed by 30 June 2012.

o These additional costs resulted in a net loss of A$48m vs our expectations of A$7m.