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| | May 29, 2008
Canaf announces Q2 profits for Quantum
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| | May 29, 2008, Vancouver, British Columbia - Canaf Group Inc. (TSXV: CAF) ("Canaf") Canaf, the Canada-registered mining group, today announced second financial quarter (Q2) profits for its South African coal-processing company, Quantum Screening and Crushing (Pty) Ltd. ("Quantum").
Quantum's audited results for the three months from February 2008 to end of April 2008 showed a net profit of US$160,248, generated from total product sales of US$1,817,004. Sales for the months of February, March and April were US$679,254, US$490,572 and $647,178 respectively.
For the previous financial quarter (November 2007 to end January 2008), Quantum's final audited results showed a net profit of US$117,219, generated from total product sales of US$2,120,215.
The Q2 results for financial year 2007-2008 represent a 36% increase in net profit from the previous quarter, despite a decrease in sales of approximately 11%. This increased profitability was generated by Quantum recently raising the sale price of its product.
Quantum is currently negotiating a five-year extension to its trading contract with BHP Billiton. In addition to that, Mittal Steel, a company that purchases over half of Quantum's monthly product for its Newcastle steel plant, is continuing to test Quantum's product at a second plant, located at Vanderbijl. Quantum continues to supply the Vanderbijl plant with approximately 1,250 tonnes of product each month but could substantially increase this once the trial period is completed, a move that would require Quantum to construct an additional kiln to cater for the extra demand. In addition, Mittal's plant in Newcastle started a six-week overhaul of its sinter plant on the 01 May 2008 which will be reflected by a reduction in sales and profits for the months of May and June.
About Canaf
Canaf Group Inc. is a junior mining group based in Vancouver, Canada, and with subsidiary offices in the United Kingdom and South Africa. Canaf owns 100% of Quantum Screening and Crushing (Pty) Ltd., a coal processing company based in South Africa. In January 2008, Canaf agreed to acquire a 51% majority interest in New Stone Mining SPRL, subject to on going due diligence and regulatory approval.
New Stone Mining is registered in the Democratic Republic of the Congo, where it has five mining concessions in the Kasai Occidental and the Oriental Province. All concessions and assets are 100% owned by New Stone Mining. New Stone Mining has developed its own system for extracting and processing diamondiferous gravel of various sizes from riverbeds using a method that minimizes waste, is kind to the environment and offers better security than other systems. New Stone Mining is currently in the process of taking the first of five alluvial diamond-mining operations into production and expects initial results to be available in June.
About Quantum
Quantum Screening and Crushing (Pty) Ltd's is one of South Africa's largest producers of calcined coke, a product that is vital in the manufacturing process of steel and manganese. The company's two largest clients are Mittal Steel and BHP Billiton, world leaders in steel and manganese production respectively. Quantum has a plant in Newcastle, KwaZulu Natal, where its two kilns operate around the clock calcining the raw material anthracite. The majority of Quantum's feedstock anthracite is supplied by Springlake Colliery, which has reserves in excess of 40 years and is based in Dundee, the neighbouring town to Newcastle. Quantum has been operating profitably since 2002 and recent annual net profits have been US$0.66 million for year-end 2006 and US$0.814 million for year-end 2007 (based on South African year end of 28 February).
Forward-Looking Statements
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.
UK Office:
Christopher Way
Canaf Group Inc.
Phone: +44 1273 492100
Fax: +44 1273 492175
Investor Relations:
Bryson Goodwin
Ascenta Capital Partners Inc.
Phone: + 1 604-684-4743 ext. 239
Toll free: +1-866-684-4209
Fax: + 1 604-939-1292
Email: bryson@ascentacapital.com
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. |
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