June 22, 2011, Vancouver, British Columbia - Canaf Group Inc. (TSXV: CAF) ("Canaf" or the "Company") the Canada-registered mining group, today released its Financial Statements and Management Discussion and Analysis for the 3 months ended April 30, 2011 and the appointment of a new President.
For the 3 months ended April 30, 2011 sales increased approximately 35% to $3,709,335 from $2,753,589 for the previous quarter, reflecting higher sale prices and higher volume sales.
Cost of sales at $3,325,814 increased the operating margin to 10.0% or $383,521, compared to the previous quarter (margin of 6.6%). The increase in the margin was caused by an unusually low margin during the previous quarter caused by a planned major maintenance shutdown.
The net book profit for the Company, after allowing for provisional tax, during the period was $85,868 and at April 30, 2011, the Company had cash of $965,604.
The Company has also recently committed to purchase new crushing and screening plant for Quantum's operation in South Africa, which is expected to be commissioned before the end of July 2011. The total cost of investment is estimated at approximately $235,000. The new crushing and screening plant will enable Quantum to significantly improve its range of sizes of products so that further increase in orders can be achieved from a greater number of customers.
The Company was pleased to announce in Annual General Meeting on 14 June, 2011 the appointment of Christopher Way, replacing David as President of the Company. Christopher has been an integral part of the Company since joining in 2007. David remains Chairman and Chief Executive.
The Company is investigating the switch to coal gasifiers, from electric, to heat the kilns, in an attempt to reduce heating costs. Consulting engineers who designed and commissioned both kilns are expected to complete their proposals to switch one of the two kilns to lower cost gasifiers over the next four months. The resulting reduction in operating costs will have a positive impact on gross margin. Further details will follow regarding the proposed timescale for the conversion works, once trials have been completed.
The Financial Statements and Management Discussion and Analysis can be viewed on www.sedar.com or the Company's website, www.canafgroup.com. All reference to dollars herein are to US dollars.
Canaf Group Inc. is a junior mining group based in Vancouver, Canada, and with subsidiary offices in the United Kingdom. Canaf owns 100% of Quantum Screening and Crushing (Pty) Ltd., a carbon producing company based in South Africa.
Quantum Screening and Crushing (Pty) Ltd's is one of South Africa's largest producers of calcined anthracite, a product used as a replacement to coke in the manufacturing process of steel and manganese. The company's two largest clients are Mittal Steel and Samancor, world leaders in steel and manganese production respectively. Quantum has an operation in Newcastle, KwaZulu Natal, where its two kilns operate around the clock devolatising the raw material, anthracite. The majority of Quantum's feedstock anthracite is supplied by Springlake Colliery, which has reserves in excess of 25 years and is located in the nearby town of Dundee.
Certain information regarding Canaf contained herein may constitute forward looking statements. Forward looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although Canaf believes that the expectations reflected in such forward looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward looking statements. Canaf is under no obligation to update or alter any forward looking statement. These risks include operational, political, currency and geological risks and the ability of Canaf to raise or obtain funds for its operations. Canaf's forward-looking statements are expressly qualified in their entirety by this cautionary statement.
For further information on Canaf Group, visit www.canafgroup.com or see contacts below.
Canaf Group Inc.
Phone: +44 1273 492100
Fax: +44 1273 492175
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
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