Financial Results for the three and nine months to 30 September 2011 Supplemental Information

23 Nov 2011

The Company has received a number of investor questions today, mainly around the Q3 2011 Adjusted EBITDA and why it has decreased compared to Q2 2011 Adjusted EBITDA, when the average sales price has increased slightly and cash costs have decreased.

There are a number of different items that should be looked at when comparing movements in EBITDA and the operational performance between quarters. In addition to the items already removed in the calculation of Adjusted EBITDA, there are two others that should be excluded – deferred stripping and net movement in inventories.

Deferred stripping, and its impact on the quarterly results, is outlined on page 12 of the Q3 2011 report, while movement in inventories are discussed on page 13. In summary, these are both non-cash items that arise in the normal course of our operations – and they can have a significant impact on the P&L and Adjusted EBITDA.

To show the effect, below is a split of the key items, showing how to go from Operating Profit / Loss to Adjusted EBITDA – and then to ‘Cash’ EBITDA, which removes these non-cash items. These balances are for the full Consmin group and reconcile to the quarterly / annual reports:

Consmin Group Operating Profit to Adjusted ‘Cash’ EBITDA Split
US$m Q1 2010 Q2 2010 Q3 2010 Q4 2010 FY 2010 Q1 2011 Q2 2011 Q3 2011 9mths 2011
2011 Operating Profit / Loss 113.8 54.6 (39.6) 29.0 157.8 11.5 (43.2) 9.5 (22.2)
Depreciation & Amortisation 30.8 30.5 34.2 24.6 120.1 31.6 41.9 30.1 103.6
Impairment Adjustment (1.5) (0.1) (27.0) (28.6)
Net foreign exchange (65.3) 0.4 53.8 10.0 (1.1) (0.9) 0.4 6.3 5.8
Non-cash inventory adjustment 16.9 32.3 (31.2) 18.0
Adjusted EBITDA 77.8 85.4 48.4 36.6 248.2 59.1 31.4 14.7 105.2
Deferred stripping (1.0) (14.0) (22.1) (37.1) (1.7) (23.1) (9.0) (33.8)
Net movement in inventories (11.8) (37.4) (6.2) (0.1) (55.5) (14.7) 26.7 47.4 59.4
‘Cash’ EBITDA 65.0 34.0 20.1 36.5 155.6 42.7 35.0 53.1 130.8


The impact of these non-cash items on our Adjusted EBITDA can be seen above. The Adjusted EBITDA per the accounts does decrease in Q3 2011 compared to Q2 2011, however this is the result of the impact of the net movement in inventories. When non-cash items are removed to get a ‘Cash’ EBITDA, it has increased quarter on quarter – the result which is expected due to the slightly higher prices and lower costs (Q3 2011 v Q2 2011).

About Consolidated Minerals Limited

Consmin is a leading manganese ore producer with mining operations in Australia and Ghana. The principal activities of the Company and its subsidiaries (the “Group”) are the exploration, mining, processing and sale of manganese products. The Group’s operations are primarily conducted through four major operating/trading subsidiaries; Consolidated Minerals Pty Limited (Australia), Ghana Manganese Company Limited (Ghana), Manganese Trading Limited (Jersey) and Pilbara Trading Limited (Jersey). Consolidated Minerals Limited is headquartered in Jersey and the address of its office is Commercial House, 3 Commercial Street, St Helier, Jersey, Channel Islands, JE2 3RU.

Company Information

For further information, please visit our website or contact:


+44(0)1534 513 300
Glenn Baldwin, CEO
Jackie Callaway, CFO