Coal Energy: marginal output growth, big destocking in July

Coal Energy (CLE PW) posted coal mining of 159 kt (+0.4% mom, +23% yoy) and preparation of coal from waste of 41 kt (+18% mom, +138% yoy) in July, the company reported yesterday. Coal Energy noted it was able to decrease its coal inventory (which grew 1.9x qoq as of end-March to USD 9.5 mln) to the level seen as of end-2011 (USD 5.0 mln).

Alexander Paraschiy: The amount of July’s destocking is equivalent to 40% of average monthly sales in 3QFY12. This suggests Coal Energy experienced a sound recovery in demand for coal in July, which looks encouraging. We explain it by the start of Ukrainian electricity generation companies’ accumulation of coal stockpiles to prepare for the next heating season.