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GEO ENERGY RESOURCES LIMITED | Annual Report 2012 9
mine owner cum operator in respect of the BEK Mining
Concession (“BEK Mine”) in January 2012. The Group
ramped up coal production and registered an increase
in overall coal production volume by approximately 88%
from 0.8 million tonnes in FY2011 to 1.5 million tonnes in
FY2012, and that helped the Group achieve a 36% surge
in gross profit y-o-y to US$36.2 million.
The Group’s gross profit margins also improved due
to a lower average stripping ratio from the BEK Mine as
compared to that of the coal cooperation contracts which
resulted in lower average mining costs.
FY2012’s performance has given us confidence for the
coming year. Barring unforseen circumstances, we are
optimistic that we will be able to once again achieve our
internal targets and perform even better operationally, in
line with our planned increase in production capacity.
Business Updates
The Group’s listing in October 2012 has given us the added
impetus to work tirelessly towards consistent growth to
bring further value to our shareholders.
InDecember 2012andJanuary 2013, weentered intomining
services contracts and coal sales and purchase contracts
with third party mine owners. These contracts allow us to
provide our expertise through overburden removal and coal
haulage while also allowing us to purchase a fixed amount
of coal produced from the concession sites for the Group’s
future coal sales.
In February 2013, the Group entered into four conditional
sale and purchase agreements for four mine concessions
located in the same region as our BEK Mine. Upon the
determination of the reserves located in the areas and
the purchase price, the Company shall release further
announcements as appropriate and/or required pursuant to
the Listing Manual, and shall also proceed, in due course (if
necessary) to dispatch a circular to Shareholders seeking
approval for the acquisitions at an extraordinary general
meeting. Upon the completion of the agreements, these
four concessions, with areas of 5,010 hectares, 6,350
hectares, 5,094 hectares and 4,923 hectares respectively,
will significantly increase the Group’s coal reserves and the
variety of coal with calorific values ranging from 4,000 to
6,500 kcal/kg thereby enabling the Group to cater to a wide
range of customers.
The Group will continue to work towards the discovery of
new concession sites and securing new mining contracts
as we strive to grow our operations on a larger scale.
FY2012 marks our first official year as a listed company
on the Singapore Exchange. The Group understands
that with a good set of results, our shareholders might
expect a dividend payout as a means of appreciation for
their support. While we do not rule out a dividend payout
in the coming years, the Group has opted not to give out
dividends for FY2012 as it has decided to use the healthy
cash balance on hand for the expansion of the Group’s
business operations, which includes the purchase of new
mining equipment and machinery to cope with a projected
increase in our operations.
AWarmWelcome
In December 2012, the Group welcomed to the Board of
Directors, Mr James Beeland Rogers Jr.Currently Chairman
of Beeland Interests, Inc, the 70 year old Singapore-based
Mr Rogers is an author of six books, a globally renowned
financial commentator and a successful international
investor. In recent years, Mr Rogers has on a few occasions
emphasised the growing power of agricultural and mining
companies and in February 2011, Mr Rogers started the
Rogers Global Resources Equity Index, focusing on the
top companies in agriculture, mining, metals and energy
sectors as well as those in the alternative energy space
including solar, wind and hydropower.
In the few months since his appointment as a non-
executive director to our Board, Mr Rogers has brought
an immeasurable amount of passion and experience in his
contributions to the Group. In what is his first appointment
as a director of a Singapore-listed company, the Group
is very pleased to be able to tap on the knowledge and
network that Mr Rogers brings on board. On behalf of the
Group, I warmly welcome Mr Rogers to the Geo Energy
family.
A Note of Appreciation
On behalf of the Group, I would also like to take this
opportunity to thank our clients, consultants, suppliers and
business associates who have contributed significantly to
our energetic performance in FY2012.
To the management and staff of Geo Energy, your collective
hard work and dedication have proven to be instrumental
in our success and I look forward to many more years of
working alongside you.
To the Singapore Exchange, your advice and patience
has contributed largely to our smooth transition to a listed
company. The Group looks forward to years of successful
partnership with you.