Coal Asia open to independent revaluation

MANILA, Philippines - Listed Coal Asia Holdings Inc. has approved the proposal to engage an independent firm accredited by the Philippine Stock Exchange (PSE) to revaluate the resources of its mining subsidiary Titan Mining and Energy Corp. (TMEC).

The revaluation is part of the requirements of the PSE in connection to the initial public offering of the shares of the company.

“Based on the results of the revaluation, the corporation shall conduct a study on options to enhance stockholders benefits. The enhancement in the corporation’s assets will allow it to have retained earnings, and will result to a possible buy-back program depending on a surplus situation,” Coal Asia said in a filing.

TMEC, a wholly owned subsidiary of Coal Asia, owns mining exploration and development rights in some 13,000 hectares in Davao and Zamboanga-Sibugay.

Net proceeds from the offering, amounting to P726.87 million, will be used to bring the Davao Oriental mine into production by 2014 and the Zamboanga Sibugay mine by 2015.

Coal Asia needs $80 million over the next three to four years for the development of the two mines with potential coal resources of 120 million metric tons.

The company expects to produce an initial 600,000 metric tons of high-grade coal beginning 2014. It expects to earn P500 million in profit in the first year of the operations of the mine.

Last year, Coal Asia reported a net income of P4.91 million, more than double the P2.03 million reported in 2010 because of a 63 percent jump in sales to P21.84 million.