Trading update
1
February
2011
Shaft Sinkers Holdings plc (LSE:SHFT), the international shaft sinking and underground construction group, is pleased to provide the market with an update on trading since the Group’s successful listing on the London Stock Exchange on 23 December 2010. It will announce its results for the period ended 31 December 2010 in mid April 2011.
Overview
Since its last reported results for the half year ended 30 June 2010, the Group has successfully commenced the Styldrift project with Anglo American Platinum Limited and Royal Bafokeng Resources which continues to proceed according to plan. The sinking of the shaft in Russia at OJSC MHK EuroChem’s Volgakaly potash mine has moved into the main sink phase and remains well within budget. The Indian contract at Teesta Urja Limited’s hydroelectric project has neared conclusion of the first tunnel and work progresses well on the second tunnel. Impala 16 and 17 projects for Impala Platinum are now progressing well. All other projects remain on track.
We continue to await the outcome of a tender for a major shaft complex for an existing South African customer. Opportunities in the CIS countries also continue to proceed.
Expected results
Operating results before exceptional items for the year ended 31 December 2010 are in line with expectations.
IPO expenses were higher than previously estimated and their accounting treatment remains under review. It is currently anticipated that £1.7 million of IPO expenses (net of reimbursement by selling shareholders) will be charged in the year ended 31 December 2010 and that the IPO Bonus of £3.8 million (before reimbursement) will be charged in the year ending 31 December 2011. The accounting treatment of a £1.2 million reimbursement of the IPO Bonus by selling shareholders remains under discussion.
Exceptional items for the year ended 31 December 2010 will also include the £1.8 million profit on the sale of the Group’s investment in Alpha Resources.
The Standard Bank facility has been drawn down fully and the ABSA facility repaid. The Group ended 2010 with net cash of approximately £10 million after deduction of interest bearing debt.
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