ATH Resources plc  
A n n u a l	r e p o r t	a n d	a c c o u n t s	2 0 1 1
Develop
Invest
Produce
Restore
ATH Resources plc A n n u a l	r e p o r t	a n d	a c c o u n t s	2 0 1 1 Corporate statement
Inside this report
The year in review
IFC Corporate statement
01 Highlights
02 ATH at a glance
04 Chairman’s statement
06 Business review
 06 Chief executive’s statement
 09 Financial review
12 Corporate social responsibility
Governance
14 Board of directors and advisers
16 Principal risks and uncertainties
18 Directors’ report
21 Corporate governance report
23 Remuneration committee report
Accounts
26  Independent auditor’s report for the 
Group accounts
27 Consolidated income statement
28 Consolidated balance sheet
29  Consolidated statement of changes 
in equity
30 	 	 C o n s o l i d a t e d	c a s h	fl o w	s t a t e m e n t
31 Group accounting policies
37 	 	 N o t e s	t o	t h e	G r o u p	fi n a n c i a l	s t a t e m e n t s
55  Independent auditor’s report for the 
Company accounts
56 Company balance sheet
57 Company accounting policies
58 	 	 N o t e s	t o	t h e	C o m p a n y	fi n a n c i a l	s t a t e m e n t s
60  Notice of annual general meeting
63 Form of proxy
ATH Resources operates surface 
coal mines and is one of the 
largest producers of coal in the 
UK, providing coal principally 
to the electricity supply industry 
and also the industrial and 
house coal markets.
ATH builds success through a strong reserves development 
focus, the use of modern surface mining equipment and 
effective control of production costs. Our production 
process is clear; we:
Stay up-to-date with all the latest shareholder news 
and information online at www.ath.co.uk
Learn in more detail about how we operate on the next page...
Develop
Invest
Produce
Restore ATH Resources plc Annual report and accounts 2011 01 www.ath.co.uk
The year in review
01–13
Highlights
Sales
£84.2m
increased by £5.9m
Average selling price
£50.4 per tonne
increased by 15%
Net borrowings
£31.5m
reduced by £3.0m
Proved coal reserves
5.0m tonnes
2010: 6.1m tonnes
  Successful opening of Netherton site 
which is now in full production
  Sales volumes were 1.67m tonnes 
(2010: 1.79m tonnes) including 
0.5m tonnes supplied to legacy contracts
	 	 I m p a c t	o f	d i f fi c u l t	m i n i n g	c o n d i t i o n s	
and unexpected geological challenges, 
mitigated in part by focusing on high 
quality, lower ratio coal
  Loss before tax from continuing operations 
o f	£ 5 . 8 m	( 2 0 1 0 :	p r o fi t	o f	£ 4 . 0 m )	d u e	t o	
largely non‑cash exceptional costs of £6.2m
Read the Chairman’s Statement in full on 
pages 4 and 5
Read the Chief Executive’s statement in full on 
pages 6 to 8
“The Group continues to 
develop and invest in new 
sites in order to increase 
its reserve base and to 
strengthen the business 
going forward.”
“The Group is expecting 
an improved performance 
in the current year together 
with further reductions 
in bank debt. However, 
the trading environment 
remains a challenging one.”
David Port 
Executive Chairman
Alistair Black 
Chief Executive
Pre exceptional operating profit
£3.0m
reduced by £4.0m ATH Resources plc Annual report and accounts 2011 02 www.ath.co.uk
ATH at a glance
From exploration to restoration, ATH Resources 
develops, operates and restores surface coal mines.
One of the largest producers of coal in the UK, producing close to 2 million 
tonnes per annum. 
Coal was used to generate around a third of the UK’s electricity in 2010 and the 
Company holds coal supply contracts with nearly all of the UK’s main electricity 
generating companies.
How do we develop?
The Group employs specialist staff to identify and evaluate 
p o te n t i a l	n e w	s i te s	t h at	c o n t a in	s u f fi c i e n t	r e s e r v e s	o f	h i g h	
quality coal for economic extraction. Formal planning 
applications are prepared and submitted to replace the 
Group’s current coal production with new reserves, 
securing the long term sustainability of the business. 
How do we invest?
T h e	G r o u p	m ak e s	s i g n i fi c a n t	in v e s t m e n t	in t o	e s t ab l i s h in g	s i te	
infrastructure and initial pre production extraction of overburden. 
The Group makes necessary investment in plant and equipment 
to support the business development. The Group has a modern 
w e l l 	 m a in t a in e d 	 fl e e t 	 a n d 	 in 	 a d d i t i o n 	 s e e k s 	 t o 	 m in im i s e 	
environmental impact by using and extending its conveyor 
system whenever possible. This saves over 500,000 lorry 
movements each year.
How we operate
Develop Invest
1 2
The development stage involves 
identification, investigation and 
securing fully permitted reserves.
Investment begins when full planning 
permission is granted. ATH Resources plc Annual report and accounts 2011 03 www.ath.co.uk
The year in review
01–13
Our markets Future strategy focus
Produce Restore
3 4
How do we produce?
The Group utilises modern plant and equipment to extract coal 
deposits from surface mines. The majority of coal is used in the 
power generation industry, whilst premium coals are supplied 
to the industrial and domestic markets, making the Group 
one of the largest producers of household coal in the UK.
How do we restore?
The Group, working closely with third parties including Local 
Authorities and Environmental Agencies, utilises innovative 
techniques to minimise its impact on the environment. 
Surface mines undergo progressive restoration during coal 
extraction and, following the completion of mining activities, 
l a n d	is	r e t u r n e d	t o	an	a g r e e d	c o n d i t i o n	an d	p r o fi l e .	
Efficient production and distribution 
of coal to our customers.
We are committed to the restoration 
of our sites once production is complete.
Total market for coal in the 
United Kingdom in 2010 (tonnes)
51 million
Percentage of total UK energy 
production from coal
32% 
Market split of coal consumption in the UK
ATH supplies to three key markets – electricity 
production, industrial use and domestic use. 
Our future strategy focus is on:
  the replacement of below market legacy contracts 
with new sales contracts at current market prices;
  increasing the Group’s proved and probable Reserves;
  continued debt reduction; and
  resuming the payment of a progressive dividend 
to shareholders in the future.
15%
85%
 
 Industrial and domestic use
 
 Electricity production ATH Resources plc Annual report and accounts 2011 04 www.ath.co.uk
Chairman’s statement
Introduction
The period under review has been a 
d i f fi c u l t 	 o n e 	 f o r 	 A TH . 	 Th e 	 c o n t in u ed 	 im pa c t 	
of the below market price legacy contracts 
combined with much higher input costs, 
principally gas oil, and unexpected 
geological conditions at a number of the 
Gr o u p ’ s 	 s i tes , 	 h a v e 	 a l l 	 c r eated 	 s i g n ifi can t 	
pressure on performance.
D e s p i te	t h e s e	d i f fi c u l t i e s	t h e	G r o u p	
is committed to satisfying legacy 
contract volumes as quickly as possible 
an d	r e m a in s	o n	t r a c k	t o	f u l fi l	t h e	fi r s t	o f	
these contracts by the end of March 2012 
and the second during 2013. The Group 
has also continued to reduce net debt 
and has delivered a further reduction of 
£3.0 million to £31.5 million in the year.
Results in brief
Sales volumes for the year at 1.67 million 
tonnes were slightly lower than last year 
(1.79 million tonnes) but average selling 
p r i c e s	r o s e	b y	1 5 %	t o	£ 5 0 . 4 3	p e r	t o n n e	
( 2 0 1 0 : 	 £ 4 3 . 7 0 	 per 	 t o n n e ) , 	 in c r ea s in g 	 r ev en u e	
t o 	 £ 8 4 . 2 	 m i l l i o n 	 ( 2 0 1 0: 	 £ 7 8 . 3 	 m i l l i o n ) .	
The Group’s legacy sales contracts continue 
to constrain performance and during the 
year accounted for around 32% of total 
sales volumes. Demand for the Group’s 
products remains strong and the Board is 
c o n fi d e n t	o f	b e in g	ab l e	t o	s e l l	a l l	o f	i t s	
annual production. Pre exceptional operating 
p r o fi ts 	 w er e 	 £3 . 0 	 m i l l i o n 	 ( 2 0 1 0 : 	 £7 . 0 	 m i l l i o n ) . 	
However, as it is now apparent that the 
higher input costs, particularly gas oil, 
will feature for some time to come, it was 
necessary to increase the Group’s restoration 
provisions by £1.5 million. Additionally 
t he 	 d i f fi c u l t 	 g e o l o g i c a l 	 c o n d i t i o n s 	 at 	
Glenmuckloch and Muir Dean required a 
write down of the Group’s work in progress 
p r o vi s i o n s 	 o f 	 so m e 	 £ 4 . 1 	 m i l l i o n . 	 Th i s 	 t og et h er	
with other small exceptional charges 
resulted in a pre‑ tax loss of £5.8 million 
( 2 0 1 0 :	p r o fi t	£ 4 . 0	m i l l i o n )	a n d 	 a 	 b a s i c 	 l o s s	
per share from continuing operations of 
11.5 pence (2010: earnings of 6.3 pence). 
Dividend
Given the impact of the legacy contracts 
and the level of exceptional charges this 
year, the Board will not be recommending 
t h e	p a y m e n t	o f	a	fi n a l	d i v i d e n d .	H o w e v e r ,	
the Board will continue to review the 
situation and remains committed to 
delivering a progressive dividend to 
shareholders in the future.
Carbon Reduction Commitment
The Board maintains its view that the 
Group does not qualify for inclusion in the 
Government’s new Carbon Reduction 
Commitment Scheme (“CRCS”) and 
decided not to register for the Scheme. 
H o w e v e r ,	as	an n o u n c e d	o n	1 4	J u n e	2 0 1 1 ,	
the Department of Energy and Climate 
Change (“DECC”) has subsequently issued 
ATH with an enforcement notice, asserting 
a failure to register as a participant in the 
fi r s t	p h a s e	o f	t h e	C R C S,	w h i c h	t h e	G r o u p	
is appealing. Central to the issue is 
whether or not the electricity consumed 
by ATH’s conveyor, which transports coal 
from its Glenmuckloch site to its railhead 
at New Cumnock some twelve kilometres 
away, is exempt from CRCS. The appeal 
was heard on 7 and 8 November 2011 
and a decision is expected in early 2012. 
The cost to the Group should its appeal 
f a i l	w i l l	b e	in	t h e	o r d e r	o f	£ 1 . 4	m i l l i o n	f o r	
each of the three years from April 2011. 
The Group will update the market 
as appropriate.
Takeover talks
During the year the Group was 
approached by a third party with 
a view to possibly acquiring ATH. 
The Board fully co‑ operated with the 
third party over several months in order 
to achieve the best possible outcome for 
its shareholders but ultimately could not 
agree a basis on which the transaction 
could proceed. Offer talks were 
terminated on 13 September 2011. 
In summary
	 	 De s p it e 	 d i f fi c u lt 	 c o nd it i o n s 	
the Group has delivered 
a n 	 o per a t i n g 	 p r o fi t 	 be f o r e 	
exceptionals of £3.0m 
(2010: £7.0m)
  Net debt reduced for the third 
consecutive year by £3.0m 
to £31.5m
  In light of the loss for the 
year the Board will not be 
recommending a dividend 
but remains committed 
to delivering a progressive 
dividend policy in the future
“The Group expects a continued rise in average 
selling prices and turnover. Bank debt is also 
expected to continue to reduce.”
David Port Executive Chairman ATH Resources plc Annual report and accounts 2011 05 www.ath.co.uk
The year in review
01–13
Banking and restoration 
bond facilities
During the year the Group was able 
to successfully re‑ negotiate its banking 
facilities, increasing the facility available and 
extending the duration to 31 May 2013.
As the Group opens a new site it has 
to provide the local authority with an 
insurance bond to cover the liability of 
restoring the site in the event that the 
Group fails to do so. Recently this market 
has tightened considerably with one of 
the Group’s main providers withdrawing 
from the market and a second provider 
reducing its participation. Maintaining an 
appropriate level of bonding will be one 
of the main challenges facing the Group 
in the coming year. However, the Board 
has recently negotiated additional facilities 
w i th 	 i t s 	 e x i s t ing 	 pro v i de r s 	 an d 	 i s 	 con fi de n t 	
that the necessary bonding facilities will 
be available as and when required for 
both new and exsiting sites.
The Board
I n	J u l y	2 0 1 0	t h e	B o ar d	d e c i d e d	t h at	m y	
position as Non‑ executive Chairman should 
become Executive in order to oversee the 
transition to a new management team 
following the departure of the former 
Chief Executive, Tom Allchurch, and 
Finance Director, Steven Beaumont. Their 
replacements, Alistair Black and Andrew 
Weatherstone, have now been in their 
posts for over twelve months and together 
have conducted a thorough review of the 
business and re‑ negotiated the Group’s 
b an k in g 	 f a c i l i t i e s . 	 T h e 	 B o ar d 	 i s 	 s at i s fi e d 	
that the transition to the new management 
team is complete and that I can resume 
my previous role as Non‑ executive 
Chairman. This change will take effect 
from the date of the Annual General 
Meeting on 29 February 2012.
The Group’s Senior Non‑ executive Director, 
Vaughan Williams, has decided to retire 
from the Board and will step down at the 
Annual General Meeting. The Board would 
like to join me in thanking Vaughan for his 
valuable contribution over the last seven 
years and in wishing him well for the future.
Tim Stokeld will become the Senior 
Independent Director and will chair the 
Audit and Remuneration Committees. 
Outlook
Production is planned to continue at around 
current levels with the Group’s strategy 
focused on delivering as much of the legacy 
contracts as possible whilst continuing to 
comply with its commitments to its banks 
and shareholders, and further reductions 
in debt.
Following the successful re‑ negotiation 
of one of the Group’s remaining legacy 
contracts the Board expects a continued 
rise in average selling prices and turnover. 
However, it recognises that the Group 
is exposed to movements in commodity 
markets and should the recent disconnect 
between rising gas oil prices and falling 
coal prices continue margins will be 
impacted. The new mine at Netherton 
is now in full production as planned 
and Duncanziemere which has recently 
commenced coaling is performing 
satisfactorily and will progressively increase 
production throughout the coming year.
Looking to the longer term, the Group 
continues to develop and invest in new sites 
in order to increase its reserve base and 
to strengthen the business going forward. 
David Port 
Executive Chairman
Sales
£84.2m
2010: £78.3m
Net debt
£31.5m
2010: £34.5m
Our ongoing strategy
To maintain and develop the 
surface mining business as one 
of the leading producers of 
coal in the UK. 
 
  the replacement of below 
market legacy contracts with 
new sales contracts at current 
market prices;
  increasing the Group’s proved 
and probable Reserves;
  bank debt reduction; and
  resuming the payment of 
a progressive dividend in 
the future.
Our ongoing strategy 
will focus on: ATH Resources plc Annual report and accounts 2011 06 www.ath.co.uk
Business review
Chief Executive’s statement
Review of the period
Following my appointment as Chief 
E x e c u t i v e	in	J u l y	2 0 1 0 ,	g r e ate r	e m p h a s i s	
h a s	b e e n	p l a c e d	o n	f u l fi l l in g	t h e	s u p p l y	o f	
tonnage due under legacy contracts and 
the reduction of debt, both of which will 
improve future shareholder value in the 
longer term. Given the increased costs of 
production, a review of both current and 
i d e n t i fi e d 	 p o te n t i a l 	 f u t u r e 	 s i te s 	 h a s 	 b e e n 	
undertaken with increased focus on 
mining lower ratio, higher quality coal 
reserves. Whilst several cost‑ saving 
initiatives targeted at reducing the Group’s 
operating cost structure are beginning to 
take effect, the major challenge for the 
Group remains the continued escalation 
in the price of gas oil at a time when 
income is constrained by the impact 
o f	fi x e d	p r i c e	s a l e s	c o n t r a c t s	a n d 	 a	
reduction in international coal prices.
Operational review
R e v e n u e	f o r	t h e	p e r i o d	w a s	£ 8 4 . 2	m i l l i o n	
(2010: £78.3 million) from 1.67 million 
tonnes (2010: 1.79 million tonnes). 
Average selling prices increased by 15% 
t o 	 £ 5 0 . 4 3 	 p e r 	 t o n n e 	 ( 201 0 : 	 £4 3.70 	 p e r	
t o n n e ) ,	b e n e fi t in g	n o t	o n l y	f r o m	in c r e a s e s	
in the international market price of coal 
but also from an improved mix. This policy 
has helped mitigate the impact of rising 
input costs and the unexpected geological 
conditions at Glenmuckloch and increased 
old workings at Muir Dean.
Alongside these operational challenges, 
the Group was faced with a rise of 28% 
in the price of gas oil, its single largest 
input cost. Prices have risen by a further 
5% since the year end, in part driven by 
adverse movements in the value of the 
US dollar. Furthermore, following an 
increase in international rubber prices, 
the cost of replacement tyres has increased 
by 15% in the second half of the year with 
further rises anticipated during 2012.
During the year the Group invested 
some £8.0 million in successfully opening 
its new operation at Netherton. Although 
quantities of heat affected coal in the 
initial areas impacted on both volume 
and quality, this site contributed nearly 
30% of the Group’s total production 
in 	 t h e 	 p a s t 	 fi n an c i a l 	 y e ar . 	 W i t h 	 t h e 	 s i te 	
now in full production and operations 
having advanced away from the heat 
affected areas, Netherton is expected 
to account for over 37% of the current 
year’s production.
In spite of these challenging conditions 
the Group was still able to report an 
o p e r at in g 	 p r o fi t 	 b e f o r e 	 e x c e p t i o n a l 	
charges of £3.0 million (2010: £7.0 million).
After making capital investments of 
£10.6 million, the Group has continued to 
reduce debt to £31.5 million, a reduction 
of £3.0 million in the year. This is the third 
consecutive year debt levels have reduced.
Legacy contracts
One of the features of the Group’s 
business is the supply of coal contracted 
to the Electricity Supply Industry (“ESI”) 
at 	 fi x e d 	 p r i c e s 	 w h i c h 	 ar e 	 b e l o w 	 c u r r e n t 	
market prices. Since the year end the 
Group has been able to successfully 
re‑ negotiate improved terms for one 
of these contracts which will increase 
average selling prices. 
This year around 32% of sales volumes 
were supplied to satisfy these contracts. 
It remains a key priority for ATH to meet 
these commitments as quickly as possible. 
Consequently the Group remains on track 
t o	c o m p l e te	t h e	fi r s t	o f	t h e s e	c o n t r a c t s	
in March 2012 with a second due to be 
completed the following year. Legacy 
volumes will then fall to around 15% 
of annual sales volumes.
“Greater emphasis has been placed on fulfilling the 
supply of tonnage due under legacy contracts and 
the reduction of debt, both of which will improve 
future shareholder value in the longer term.”
Alistair Black Chief Executive
In summary
  Mining strategy concentrated 
on higher quality lower ratio 
reserves to help mitigate the 
impact of gas oil price rises 
and unexpected geological 
conditions during the year
  Sales volumes amounted to 
1.67m tonnes (2010: 1.79m 
tonnes) including 0.53m tonnes 
supplied to legacy contracts
  Average selling price increased 
b y 	 1 5 % 	 t o 	 £ 5 0 . 4 3 	 per 	 t o n n e	
( 2 0 1 0 : 	 £ 4 3 . 7 0 	 per 	 t o n n e )
  Successful opening of Netherton 
which is now fully operational. 
Duncanziemére has recently 
started coaling
  Achieved planning permissions 
for the extensions at 
Glenmuckloch East and Muir 
Dean for 505,000 tonnes and 
350,000 tonnes respectively
  Successful re‑ negotiation of 
the Group’s remaining legacy 
c o n t r a c t s 	 ef f e c t i v e 	 fi r st 	 q u a r t er 	
of 2012. ATH Resources plc Annual report and accounts 2011 07 www.ath.co.uk
The year in review
01–13
Coal reserves and mine development
Following the successful opening of 
Netherton, the Group commenced 
its initial site preparations to develop 
Duncanziemere, which is expected 
to become fully operational this year. 
In addition, the Group was successful 
in achieving planning permission for 
extensions at Glenmuckloch and Muir 
Dean for 505,000 tonnes and 350,000 
tonnes respectively, both of which 
form part of current production plans.
As at 2 October 2011 the Group had 
5.0 million tonnes proved reserves (2010: 
6.1 million tonnes) and probable reserves 
of 2.9 million tonnes (2010: 2.5 million 
tonnes). The table overleaf, relating to 
exploration results, mineral resources or 
mineral reserves is based upon information 
compiled by Peter Morgan, a full time 
employee of the Group who is a Fellow 
of the Institute of Materials, Minerals 
an d	M in in g .	M r	M o r g a n	h a s	s u f fi c i e n t	
experience which is relevant to the style 
of mineralisation and type of deposit 
under consideration. He has reviewed 
and consents to the inclusion in this report 
of the matters based on his information 
in the form and context in which they 
appear. A glossary of terms is available 
on the Group’s website www.ath.co.uk.
In addition to the table overleaf, estimated 
resources in excess of 11 million tonnes 
have been secured through various licence 
agreements for sites where additional 
geological and planning work is required 
t o	c o n fi r m	w i t h	a	r e a s o n a b l e	l e v e l	o f	
certainty the tonnages available to mine.
The Group is anticipating bringing forward 
over 2 million tonnes into the planning 
process during the next twelve months.
Production this year exceeded new sites entering the planning 
system and therefore year end proved and probable reserves were 
lower at 7.9 million tonnes (2010: 8.6 million tonnes). During the 
next 12 months it is expected that new applications totalling 
around 2 million tonnes will enter the planning system.
Production and reserve levels
Read our Corporate social responsibility review in full on pages 12 and 13.
We recognise that our people are the most valuable resource within 
the business and an open and challenging working environment 
is encouraged. A key strategic objective of the Group is to provide 
safe working environments for all employees and visitors at 
ATH mines and facilities.
Our people
Number of employees
394
increase of 60
Health and safety incidents
2
reduction by 2 ATH Resources plc Annual report and accounts 2011 08 www.ath.co.uk
Business review
Chief executive’s statement continued
Staff
The Board would like to join me in thanking 
all of our management and employees 
for their unstinting efforts and support 
throughout this challenging period.
Summary
The Group is expecting an improved 
performance in the current year, together 
with further reductions in bank debt. 
However, the trading environment remains 
a challenging one, with the high cost of 
gas oil expected to continue and, in the 
short term, coal prices easing from their 
earlier peak.
Alistair Black
Chief Executive
Coal prices
International coal prices rose sharply in 
t h e	fi r s t	h a l f	o f	l a s t	y e ar	t o	a	p e ak	o f	$ 1 3 0	
per tonne but have since fallen back by 
around 20%. The evident disconnect 
between coal and oil prices over the past 
few months will, if it persists, put further 
pressure on margins for the Group; 
however, the recent re‑ negotiation of the 
Group’s remaining legacy contracts will 
help alleviate the potential impact.
Health and safety
The Board understands the potential 
hazardous nature of the work undertaken 
in surface mining. The Group takes its 
responsibilities for health and safety 
levels very seriously and strives to 
continually improve the safety levels 
in all of its operations. 
ATH has been successful in maintaining 
its RoSPA Gold award and OHSAS 
accreditation from BSI for health and 
safety standards in 2011, recognising 
the Group’s continued commitment 
to creating the safest possible 
working environment. 
Each Mine Manager has the necessary 
qu a l i fi c at i o n s	an d	c o m p e te n c e	t o	m an a g e	
operations safely and has assistance from 
a dedicated Health and Safety Manager.
Regular training is provided to employees 
in respect of the Group’s procedures with 
85% of the Group’s workforce attaining 
grade NVQ level 2, delivered by our own 
accredited training centre.
Total reserves (million tonnes)
7.9m -0.7m
2010: 8.6m
2011 2010 2009 2008 2007
Sales value (£m)
£84.2m +8%
2010: 78.3m
2011 2010 2009 2008 2007
Proved reserves (million tonnes)
5.0m -1.1m
2010: 6.1m
5.0
84.2
2011
6.1
78.3 77.5 76.9
70.5
4.7
4.5
3.5
2010 2009 2008 2007
Strong reserves and value
The Group has over four years 
of production in proved and 
probable reserves. 
7.9
8.6 8.6
8.2 8.2
     Proved Probable Total 
     ‘000 tonnes ‘000 tonnes ‘000 tonnes
Netherton    1,550 650 2,200
Duncanziemere    750 — 750
Glenmuckloch    650 — 650
Muir Dean    950 850 1,800
Rigg     1,100 900 2,000
Other     — 500 500
Total     5,000 2,900 7,900 ATH Resources plc Annual report and accounts 2011 09 www.ath.co.uk
The year in review
01–13
Business review
Financial review
“Cash generated from operations improved to 
£16.2 million from £12.7 million last year which 
helped fund capital expenditure of £10.6 million.”
Andrew Weatherstone Group Finance Director
T h e	c o n s o l i d ate d	fi n an c i a l	s t ate m e n t s	
for the Group, which are prepared in 
accordance with EU adopted International 
Financial Reporting Standards (“IFRS”), 
are presented for the 52‑ week period 
ended 2 October 2011.
The individual accounts of the parent 
company, ATH Resources plc, continue 
to be prepared under UK GAAP and 
are set out on pages 56 to 59.
Performance
G r o u p 	 sa l es 	 f o r 	 t h e 	 per i o d 	 w er e 	 £ 84 .2 	 m i l l i o n	
(2010: £78.3 million), an increase of 8%. 
Sales volumes were 1.67 million tonnes 
(2010: 1.79 million tonnes) including 
530,000 tonnes supplied to legacy contracts.
Notwithstanding the impact of these 
below market price legacy contracts, 
the average sales price per tonne rose 
b y 	 1 5 % 	 t o 	 £ 5 0 . 4 3 	 p e r 	 t o n n e 	 ( 201 0 :	
£4 3.70 	 p e r 	 t o n n e), 	 a s s i s te d 	 b y 	 an	
improved sales mix and a buoyant 
international coal price, which rose 
b y 	 o ver 		 4 0 % 	 c om pare d 	 t o 	 the 	 pre v ious	
year’s average price.
I n p u t 	 c o s t 	 in c r e a s e s 	 s i g n i fi c an t l y 	
impacted the Group’s operating margins, 
with increases in the cost of gas oil (of 
approximately 28% year on year) being 
the main driver. The Group’s hedging 
strategy did, however, help to reduce 
fuel costs by £0.5 million. In addition the 
average mining ratio at which the Group 
operates increased during the year leading 
to a rise in the unit cost of production 
t o	£ 4 3	p e r	t o n n e	( 2 0 1 0 :	£ 3 5	p e r	t o n n e ) .
During the year the Group exercised 
its option to take £2.0 million of 
royalties under its agreement with 
RecyCoal Limited. This necessitated 
an associated goodwill write off of 
£1.65 million.
Overall pre exceptional operating 
p r o fi ts 	 f el l 	 b y 	 £ 4 . 0 	 m i l l i o n 	 t o 	 £ 3 . 0 	 m i l l i o n 	
(2010: £7.0 million).
There have been a number of largely 
non‑ cash exceptional charges during the 
year, which in total amounted to £6.2 million:
•	 	 a dj us t m e n t s	t o	w o r k	in	p r o g r e s s	
b a l a n c e s	o f	£ 4 . 1	m i l l i o n	at	M u ir	D e an	
an d	N e t h e r t o n	t o	r e fl e c t	t h e	in c r e a s e	
in mining ratios after encountering 
unexpected geological conditions 
and increased old workings;
•	 	 in c r e a s e s	t o	r e s t o r at i o n	p r o v i s i o n s	
o f	£ 1 . 5	m i l l i o n	r e fl e c t in g	t h e	r i s e	
in operational costs; and
•	 	 p r o v i s i o n	f o r	a d d i t i o n a l	P A Y E	o f	
£0.6 million arising from an under 
deduction in respect of allowances 
paid to a small number of employees 
over a number of years. 
Consequently the overall loss before 
tax from continuing operations was 
£ 5 . 8	m i l l i o n	( 2 0 1 0 :	p r o fi t	o f	£ 4 . 0	m i l l i o n ) .
Financing costs
Interest costs on borrowing fell by £0.1 million 
t o	£ 2 . 0	m i l l i o n ,	r e fl e c t in g	t h e	f a l l	in	l e v e l	
of net debt, representing an effective 
interest rate of 5.5%. The non‑ cash 
e l e m e n t	o f	fi n an c in g	c h a r g e s	o f	fi n a l	v o i d	
discount and unrealised differences on 
interest rate hedges fell by £0.2 million 
to £0.7 million, making a total reduction 
in	fi n an c in g	c o s t s	o f	£ 0 . 3	m i l l i o n .
In summary
  In c r ease in gas oil prices of 
2 8% 	 y e a r 	 o n 	 y e a r 	 s i g n ifi c a n t ly 	
impacted margins. Rising input 
costs remains a major challenge
  Exceptional charges of £6.2m 
arising from mainly work in 
progress adjustments and 
additional restoration provisions
  Option exercised to take £2m 
royalties under its agreement 
with RecyCoal Limited
  Banking facilities increased 
and extended to May 2013 ATH Resources plc Annual report and accounts 2011 10 www.ath.co.uk
Business review
Financial review continued
Taxation
T h e	G r o u p	p a i d	£ 0 . 4	m i l l i o n	in	t a x	du r in g	
the year in respect of prior years. There 
was a tax credit for the year of £1.2 million 
giving an effective rate of 20.8%, compared 
the standard rate of 27%. The level of tax 
credit was lower than the expected due to 
the goodwill write off of £1.65 million in 
respect of RecyCoal Limited not being 
deductible for tax purposes.
At 2 October 2011 the Group had unused 
trading losses in excess of approximately 
£3 . 5 	 m i l l ion 	 t o 	 o f f s e t 	 ag a in s t 	 futu re 	 pro fit s.
Earnings and dividends per share
Earnings per share in respect of continuing 
operations before exceptional items were 
Nil pence (2010: earnings of 6.3 pence). 
After taking into account exceptional 
items the Group recorded a loss per share 
of 11.5 pence (2010: earnings of 6.3 pence). 
A	fi n a l	d i v i d e n d	o f	2	p e n c e	p e r	s h ar e	w a s	
p a i d 	 in 	 J a nu ar y 	 2 0 1 1 	 in 	 r e sp e c t 	 o f 	 th e 	 pr ior	
fi n an c i a l	y e a r .	I n	l i g h t	o f	t h e	l o s s	f o r	t h e	
year it is the intention of the Board not 
to recommend the payment of a dividend 
in respect of the current year.
IFRIC 20 ‘Stripping Costs in the 
Production Phase of a Mine’
T h i s	g u i d a n c e	w a s	p u b l i s h e d	in	fi n a l	f o r m	
in October 2011 and will be applicable 
for accounting periods commencing after 
J an u ar y	2 0 1 3 .	F o l l o w in g	t h e	r e v i s i o n	t o	
the Group’s accounting policy in respect 
of work in progress (deferred stripping 
costs) in the previous year, the Board does 
not believe that the adoption of IFRIC 20 
will have a material impact on the Group’s 
performance. However, IFRIC 20 requires 
the 	 de f e rre d 	 s tripping 	 c os t s 	 t o 	 be 	 cl a s sifie d 	
as a non‑ current asset. This will necessitate 
a 	 r e c l a s s i fi c at i o n 	 o f 	 t h e 	 G r o u p’ s 	 w o r k 	
in progress balance, which is at present 
included in current assets, when the Group 
implements IFRIC 20 once it is formally 
adopted by the EU.
Cash flow and borrowings
Overall total net borrowings including hire 
purchase obligations reduced by £3.0 million 
to £31.5 million, which compares to a 
peak 	 o f 	 o v er 	 £ 4 5 . 0 	 m i l l i o n 	 t h r ee 	 yea rs 	 a g o .	
Net bank borrowings amounted to 
£18.6 million (2010: £17.6 million). 
Cash generated from operations improved 
to £16.2 million from £12.7 million last 
year which helped fund the increase in 
capital expenditure which amounted 
to £10.6 million (2010: £7.3 million); this 
was slightly lower than planned following a 
delay to the start of the Duncanziemere site.
The Group successfully re‑ negotiated 
its revolving credit facility with its existing 
lenders extending it to 31 May 2013. 
In addition the facility was increased to 
provide £23.5 million until May 2012 
from which time it reduces in stages to 
£19.0 million by the end of September 2012. 
Further reductions are then phased to 
reduce the facility to £16.0 million by 
the end of April 2013.
Going concern basis
T h e s e	fi n an c i a l	s t ate m e n t s	ar e	p r e p ar e d	
on the basis that the Group is a going 
concern. In forming its opinion as to 
going concern, the Board prepares 
Sales price (£)
£50 per tonne
2010: £44
Cost price (£)
£43 per tonne
2010: £35
Coal reserves (million tonnes)
7.9m
2010: 8.6m
Health and safety incidents
2
2010: 4
Environmental incidents
0
2010: 1
Return on capital employed
6%
2010: 11%
Key performance indicators
 
 
 
Pre exceptional operating profit
£3.0m
2010: £7.0m
Cash generated from operations
£16.2m
2010: £12.7m ATH Resources plc Annual report and accounts 2011 11 www.ath.co.uk
The year in review
01–13
      2011 2010 
Movement in net debt     £000 £000
Cash generated from operations   16,172 12,736
Interest and tax     (2,392)	 ( 4,4 27)
Sale of ATH Regeneration assets   — 6,258
Net capital expenditure      (10,024) (6,850)
Dividends paid       (801) (2,865)
Movement in debt       2,955	 4, 8 5 2
Net debt brought forward     (34,498) (39,350)
Net debt carried forward    (31,543)	 (3 4,49 8 )
forecasts and projections based upon 
detailed assumptions in particular with 
regard to levels of coal production and 
the key risks and uncertainties, together 
with the level of borrowings and other 
facilities made available to the Group. The 
Board also takes account of reasonable 
possible changes in trading performance 
to determine whether the Group should 
be able to operate within its current level 
of facilities. Key factors that have been 
considered are:
•	 	 r e c e n t	p e r f o r m a n c e	h a s	d e m o n s t r ate d	
the impact of unpredictable geological 
conditions on production volumes. 
Further shortfalls of production could 
lead to a potential material adverse 
im p a c t	o n	c a s h	an d	p r o fi t ab i l i t y ;
•	 	 t h e 	 G r o u p 	 r equ ir es 	 a d equ ate 	 r est o r at i o n	
bond facilities to continue to operate 
both existing and new sites. Recently the 
number of bond providers providing 
surety in this market has reduced with 
one withdrawing from the market 
c o m p l e te l y	an d	an o t h e r	s i g n i fi c an t l y	
curtailing its participation. Shortage 
of bond facilities could lead to the 
Group not being able to operate at 
planned levels of production and 
failure to renew a bond could result in 
a claim on the Group under the terms 
of its counter indemnities given to 
the bond providers. However, the 
Group has recently negotiated 
additional facilities with its existing 
p r o v i d e r s	an d	is	c o n fi d e n t	t h at	t h e	
necessary bonding facilities will be 
available as and when required;
•	 	 b an k 	 f a c i l i t i e s 	 h a v e 	 r e c e n t l y 	 b e e n	
re‑ negotiated, providing a facility 
through to 31 May 2013. The facility 
is at a level of £23.5 million, with 
scheduled reductions commencing 
May 2012 onwards reducing the facility 
to £19.0 million by September 2012 
and then to £16.0 million in April 2013. 
  These facilities contain performance 
covenants including interest cover, 
debt to borrowing ratio and debt 
service ratio, which if breached could 
lead to a need to re‑ negotiate terms 
or in the extreme case, a reduction 
or withdrawal of the facilities 
concerned; and
•	 	 s a l e s	p r i c e	in	r e s p e c t	o f	a	n u m b e r	o f	
c o n t r a c t s	ar e	fl o at in g	an d	b a s e d	u p o n	
the international price of coal, creating 
a risk of unpredictability in revenues 
and cash.
The Board recognises the material 
uncertainties noted above but, based 
upon information available to it at 
t h e	d ate	o f	a p p r o v a l	o f	t h e s e	fi n an c i a l	
s t ate m e n t s ,	c o n fi r m s	i t s	b e l i e f	t h at	
it is appropriate to use the going 
concern basis of preparation for 
t h e s e	fi n an c i a l	s t ate m e n t s .
A P Weatherstone
Group Finance Director ATH Resources plc Annual report and accounts 2011 12 www.ath.co.uk
Corporate social responsibility
The Group is aware that its activities 
can have an impact on a wide range 
of stakeholders including employees, 
neighbouring communities and local 
and national governmental agencies 
and departments. The Group strategy 
focuses on the integration of its policies 
to maximise opportunities for its people 
and the communities within which we 
operate, whilst minimising the impact 
of its activities on the environment, 
neighbours and other interested parties. 
Environment
The Group is conscious that its activities 
c o u l d	h a v e	a	s i g n i fi c a n t	im p a c t	o n	t h e	
environment. The Group considers the 
potential environmental impact of its 
operations at every stage of a mine’s life 
cycle from the initial planning phase 
t o	fi n a l	r e s t o r at i o n .	P r o m o t in g	e x c e l l e n c e	
in environmental standards is a primary 
objective of the business and these issues 
are key to the strategic development 
of each site.
During the planning phase of each 
potential project, a full environmental 
assessment is carried out which is 
included within a formal planning 
application as the Environmental 
Statement. The potential impact on 
the environment at each stage of the 
development and operation of a site 
is considered and reported by senior mine 
management which engages specialist 
external consultants as required. 
The Group implements many initiatives 
to improve the local environment and 
environmental legacy issues. At the former 
Grievehill site in Ayrshire, the Group employs 
rangers to assist in supporting suitable 
nesting areas for birds of prey, including 
the rare hen harrier. This enabled hen 
h ar r i e r	c h i c k s	t o	fl e d g e	du r in g	t h e	y e ar .	
At Grievehill, the Group improved the 
condition of 150 hectares of degraded 
bog through a re‑ wetting programme.
At Muir Dean in Fife, the Group is 
implementing a scheme to resolve what 
is considered to be the worst coal mine 
legacy pollution of a water course 
in Scotland. Working closely with the 
Scottish Environmental Protection Agency, 
the scheme involves the creation of a 
minewater treatment facility to remove 
iron and other pollutants from the 
Fordell Day Level, an old deep minewater 
drainage tunnel. The polluted minewater 
is pumped through water cascades and 
l a g o o n s 	 an d 	 fi l te r e d 	 t h r o u g h 	 o r g an i c 	
reed beds before being discharged back 
into its original course. 
A TH 	 i s 	 a 	 p art n er 	 o f 	 t h e 	 E a st 	 Ayrs h ir e 	 C o a l fi el d 	
Environment Initiative, a partnership 
involving the local authority, conservation 
bodies and industry, working to enhance, 
promote and conserve the environment. 
This initiative has included the creation 
and enhancement of wildlife habitats 
and schools liaison amongst others.
People
The Group recognises that its people 
are the most valuable resource within 
the business and an open and challenging 
working environment is encouraged. 
ATH is committed to the training and 
development of its people to allow all 
s t af f	m e m b e r s	t o	f u l fi l	t h e ir	p o te n t i a l .	
The surface mining industry involves the use 
of large plant and machinery and the Group 
in v e s t s	s i g n i fi c an t	r e s o u r c e s	t o	e n s u r e	a l l	
operatives are properly trained to use the 
equipment safely and effectively. The Group 
undertakes an ongoing programme to 
monitor employee competency and each 
staff member has a tailored development 
and training plan to ensure that ATH remains 
an industry leader in employee competence.
Management training
During the year, the Group continued 
to focus on talent management and 
career development, with the objective 
of identifying the future managers 
of the business and providing them 
with the training and skills to develop. 
Career ladders have been created for 
all departments to provide a clear career 
progression plan for each team, setting 
o u t	t h e	e x p e c te d	qu a l i fi c at i o n s	an d	
anticipated experience required for an 
employee to be considered for promotion.
The Learning and Development Plan has 
am a l g am ate d	a l l	t h e	t r a in in g	i d e n t i fi e d	
during performance reviews. This plan 
provides cost effective, targeted training 
in order to develop the skills and capabilities 
of the Management of ATH.
Operational training
During the year, the Group continued 
to provide specialist training through the 
Mining Training School at the Grievehill 
restoration site. This School is responsible 
for all the new starter inductions and 
delivery of all the NVQ assessments. 
Conducting both the assessments and 
inductions on a restoration site ensures 
the highest standard of training is delivered 
in a safe environment under the close 
s u p e r v i s i o n	o f	a	qu a l i fi e d	t r a in e r	an d	
assessor. The assessment centre has 
achieved accreditation to continue 
t o	o f f e r	qu a l i fi c at i o n s	u n d e r	t h e	n e w	
Q u a l i fi cat i o n s 	 C r ed i t 	 F r am ew o r k 	 in 	 2 0 1 1 .
The high level of training capability 
has seen the school train 85% of the 
workforce to NVQ Level 2 standards 
on their primary piece of equipment, 
when combined with the large amount 
of tertiary training delivered to the 
workforce, means that ATH has one of 
t h e	b e s t	qu a l i fi e d	an d	m o s t	c o m p e te n t	
workforces within the industry.
Environment 
The Group considers the potential 
environmental impact of its operations 
at every stage of a mine’s life cycle. ATH Resources plc Annual report and accounts 2011 13 www.ath.co.uk
The year in review
01–13
Health and safety
A key strategic Group objective is to provide 
safe working environments for all employees 
and visitors at ATH mines and facilities.
Group health and safety policies 
and procedures are controlled through 
the ATH Resources plc Health and Safety 
Committee, chaired by the CEO responsible 
for health and safety. Health and safety is 
managed through the Health and Safety 
Assessment Model which drives Group 
performance through four key stages. 
The policy strives for continuous 
improvement through awareness, 
competence, compliance and excellence.
The Group provides ongoing high 
quality training to all employees in 
every aspect of health and safety and 
promotes an open culture where unsafe 
practices are challenged and reported 
to achieve our targets of excellence and 
continuous improvement. 
The Group had two reportable injuries 
during the year (2010: four) and suffered 
no major injuries. The Company has an 
a u d i te d	in c i d e n t	r ate	o f	4 5 6	f o r	R I D D O R	
reportable incidents compared to the 
industry average of 1292.
The Group continues to maintain full 
accreditation to OHSAS 18001 (Occupational 
Health and Safety Management Systems) 
which recognised the quality of the processes 
for the management of health and safety 
within the Group.
RoSPA Gold Award
During the year, ATH was again awarded 
RoSPA (Royal Society for the Prevention 
of Accidents) Gold Award 2011. This 
accreditation was received in recognition 
of the Group’s performance in promoting 
and attaining a high standard in the 
management of health and safety 
and in providing a safe place of work. 
Areas of particular strength were in 
h a z ar d	i d e n t i fi c at i o n ,	t h e	u s e	o f	s af e	
working practices, compliance with 
industry regulations and the involvement 
of safety representatives in new initiatives 
and training.
These achievements are shared by all 
employees of the Group without whose 
commitment and effort the improvements 
and awards would not have been attained.
Social and community
The Group understands the importance 
of communication and interaction with 
our neighbouring communities to provide 
information about its operations and support 
through sponsorship and donations. 
ATH operates community liaison groups 
at each of its sites. These groups meet 
on a regular basis and allow the exchange 
of information on site progress whilst 
enabling community representatives 
to raise any issues for discussion. 
The Group provides support to community 
g r o u p s	an d	p r o j e c t s	an d	p r o v i d e s	fi n an c i a l	
support through direct sponsorship and 
activities or through community and 
environmental trusts. 
Supported independent trusts include the 
Cumnock and Doon Valley Minerals Trust, 
t he 	 K irk c o n nel 	 Coa lfield 	 T rust, 	 t he 	 Coa lfields 	
Environment Initiative and the Muir Dean 
Environmental Trust. Overall, the Group 
c o n t r ib u te d	£ 3 4 7 , 0 0 0	t o	t h e s e	s c h e m e s	
which provide support to a wide range 
of good causes including Scout and Guide 
groups, local Church organisations and 
sports clubs.
“During the year ATH were again awarded 
RoSPA Gold Award 2011, in recognition of the 
Group’s performance in promoting and attaining 
a high standard in the management of health 
and safety.”
RoSPA GOLD Award
The Group’s continued commitment to 
excellence in health and safety procedures 
and practices was recognised in the year 
with the presentation of the RoSPA Gold 
Award in Occupational Health and Safety.
Gold
Award
20 11 ATH Resources plc Annual report and accounts 2011 14 www.ath.co.uk
Board of directors and advisers
Registered office
Aardvark House 
Sidings Court 
D o n c a s te r	D N 4	5 N U
Company number
4 92 8 4 63
Bankers
HSBC Bank Plc 
8 Canada Square 
L o n d o n	E 1 4	5 H Q
Y o r k s h ir e	B a n k 
4	V i c t o r i a	P l a c e 
Manor Road 
Leeds LS11 5AE
Solicitors
Eversheds LLP 
Bridgewater Place 
Water Lane 
Leeds LS11 5DR
Auditor
Baker Tilly UK Audit LLP 
2 Whitehall Quay 
L e e ds	L S 1	4 H G
Nominated adviser  
and broker
Seymour Pierce Limited 
20 Old Bailey 
L o n d o n	E C 4 M	7 E N
Financial PR advisers
Abchurch Communications Limited 
125 Old Broad Street 
London EC2N 1AR
Registrar
Capita Registrars 
The Registry 
3 4	B e c k e n h a m	R o a d 
Beckenham 
K e n t	B R 3	4 T U
1 3 5
2 4 ATH Resources plc Annual report and accounts 2011 15 www.ath.co.uk
Governance
14–24
1. David Port
Executive Chairman
D a v i d 	 P o r t 	 qu a l i fi e d 	 a s 	 a 	 C h ar te r e d 	
Management Accountant whilst with 
National Freight Company Limited where 
he rose to become Group Chief Accountant 
and Divisional Finance Director. Following 
three years at Northern Foods Plc as 
Finance Director of the dairy division, 
he joined British Fuels Limited as Finance 
Director and rose to Chief Executive and 
Chairman, leading the management 
buyout from British Coal during the 
privatisation process and disposing of 
t h e	b us in e s s	p r o fi t a b l y	in	a	t r a d e	s a l e	
in 1997. Since then he has worked in 
a number of industries in the private 
and public sectors as either Chairman 
or Non‑ executive Director. Currently, he is 
Chairman of Leach Colour, a large format 
graphics company and a Non‑executive 
Director of Inutec Limited, a nuclear waste 
consultancy and processing company. 
David has been Chairman of ATH since 
it started operations in 1998.
2. Alistair Black 
Chief Executive
Alistair Black’s career to date has been 
dedicated to working in the surface coal 
mining industry, having commenced his 
training with Coal Contractors Limited 
in 1986. Having progressed to various 
managerial positions with Coal Contractors, 
he moved to Rackwood Colliery Company 
in 1996 as Regional Manager before 
commencing employment with ATH 
in 1998.
Alistair has been an Executive on 
the ATH Resources plc Board since 
t h e	C o m p an y	fl o ate d	o n	A I M	in	2 0 0 4	
and was appointed Chief Executive in 
J u l y	2 0 1 0	f o l l o w in g	t h e	d i s p o s a l	o f	t h e	
ATH Regeneration assets from the Group.
Alistair gained his MBA from Heriot Watt 
University in 1999 and is currently Health 
and Safety Director for the Group.
3. Andrew Weatherstone
Group Finance Director and 
Company Secretary
Andrew Weatherstone, a chartered 
accountant, joined the Board in 
October 2010. Having initially developed 
his career with KPMG, Andrew moved 
o n	t o	h o l d	s e n i o r	fi n an c i a l	p o s i t i o n s	at	
Commercial Vehicle Systems Inc. and 
Bostrom Plc and was Group Finance 
Director at Chapelthorpe Plc from 2003 
until his appointment with ATH. In these 
roles, Andrew has been responsible for 
a wide range of strategic, operational 
an d	c o r p o r ate	fi n an c e	p r o j e c t s .
4. Vaughan Williams
Non-executive Director
After Exeter University, Vaughan Williams 
spent four years with British Steel from 
1968 to 1972 before joining a predecessor 
company of BHP Minerals Europe Ltd 
responsible for coal sales in Europe, CIS, 
Middle East and Africa, mainly from the 
developing coal deposits in Queensland. 
In 1986 Vaughan moved to BHP Coal 
Australia Pty Ltd in Brisbane as Manager 
of Marketing Operations. After returning 
from Australia, he became Managing 
Director of BHP Minerals Europe Ltd 
covering a wide range of commodities. 
In 2000 he became Vice President 
Marketing of BHP Billiton Diamonds Inc 
where he remained until retiring in 2003. 
Since then he has been actively involved 
in farming in Oxfordshire. He joined 
t h e	G r o u p	in	2 0 0 4 .
5. Tim Stokeld
Non-executive Director
Tim Stokeld has over 30 years’ experience 
in 	 finance , 	b e g in ning 	 hi s 	 c ar e e r 	 a s 	 a 	 tra in e e	
stockbroker with Middlesbrough‑ based 
Stancliffe Todd and Hodgson before 
t a k in g	u p	s e n i o r	r o l e s	in	l e a d in g	fi n an c i a l	
companies such as Charterhouse, where 
he rose to be appointed Managing Director 
of Institutional Sales, Head of UK Equities 
and Head of Equities at CAI Chevreux. 
In 2002, Tim left CAI Chevreux to join 
Seymour Pierce Partners in 2003 as Head 
of Institutional Sales, a post he held for 
a period of four years. Following this time 
he had been with BlueOar Securities 
which he left in April 2009. Tim joined 
the Board of ATH as Non‑executive 
Director in May 2009. ATH Resources plc Annual report and accounts 2011 16 www.ath.co.uk
Principal risks and uncertainties
Replacement of production
The Group’s operations have a finite life due to the geology of each site and will 
become exhausted at some point in the future. Production is replaced through the 
development or acquisition of new sites and extensions to existing sites. Historically 
the Group has been able to replace its coal reserves due to the efforts of its internal 
planning team combined with its longstanding relationships with planning authorities 
and local communities to deliver planning consent for new sites and extensions.
Exploration 
and development
The exploration for, and development of, coal deposits involves significant risks, which 
are managed through the combination of careful evaluation, experience and knowledge. 
Not all sites which are explored are ultimately developed into producing mines. 
There can be no guarantee that estimates of quantities and qualities made will be 
realised or that appropriate consents will be granted. With all mining operations there 
is uncertainty and therefore risks associated with operating parameters and costs.
Uncertainty over 
reserve estimates
There are many unknowns inherent in estimating coal reserves and many of these 
factors are beyond the Group’s control. Adverse geological conditions could arise which 
may not be predicted based upon available data. Reserves are also subject to ongoing 
surveys which could result in either increases or decreases to the reserves present. 
The volume, grade and site ratio of coal reserves recovered have a direct impact on the 
financial results of the Group. The Group bases its coal reserve estimates on internally 
generated geological data and it regularly reviews its coal reserves on an ongoing basis 
and the estimates are revised where necessary.
General mining 
and processing risks
The Group’s operations are subject to all of the hazards and risks normally encountered 
in the exploration, development and production of coal. As well as uncertainty over 
remaining coal reserves, referred to above, the risks include adverse weather conditions, 
flooding, mechanical plant failure and difficult blasting conditions. Appropriate levels 
of site investigation are undertaken to minimise the risks of flooding and blasting 
conditions, while using its own equipment and directly employing most of its 
maintenance engineers the Group is able to react quickly to any plant issues.
Volatility of price of coal
The market price of coal is volatile and is affected by numerous factors that are beyond 
the Group’s control. These include international supply and demand, the level of consumer 
product demand, international economic trends, currency exchange rate fluctuations, 
the level of interest rates, the rate of inflation, the cost of freight, global or regional 
political events and international events, as well as a range of other market forces. 
The Group mitigates to a certain extent its exposure to the volatility of coal prices by 
using a mix of short and long term fixed price contracts. In addition the Group has 
a number of contracts which vary in line with the international price of coal. 
Volatility in gas oil prices
A significant portion of the Group’s costs are dependent upon the price of gas oil, 
which is used to power the Group’s plant fleet. An increase in gas oil costs would 
lead to an increase in operating costs. The Group manages its exposure to gas oil 
prices by using derivatives to hedge floating fuel cost exposures. ATH Resources plc Annual report and accounts 2011 17 www.ath.co.uk
Health and safety
The Group’s activities are, and will continue to be, subject to health and safety standards 
and regulations. Failure to comply with such requirements may result in fines, penalties 
and/or litigation. Moreover mining activities are subject to potential health and safety 
risks associated with the operation of heavy plant and explosives on site. Risk assessments 
are carried out by management and the services of external risk consultants are retained 
to identify any potential risks and ensure safe methods of working.
Government regulations
The Group is exposed to the impact of changes in Government regulations, in 
particular with reference to low carbon economy initiatives such as the Carbon 
Reduction Commitment Scheme, as noted in note 27 to these financial statements. 
The possibility also exists that future legislation or regulations may be adopted that 
could adversely affect the Group’s mining operations, its cost structure or its customers’ 
ability to use coal. 
Restoration bonds
The Group’s activities result in the creation of working sites and mining voids that require 
substantial remedial and restoration works at the end of coaling operations. As part of the 
planning approvals process, the Group is normally required to obtain agreed restoration 
bonds that cover the anticipated remedial works, which are substantial in certain instances. 
The impact of recent uncertainty in the financial markets has reduced the potential sources 
of restoration bonds and could lead to insufficient facilities being made available, 
although the Group has negotiated additional facilities with its existing providers 
and is confident that the necessary facilities will be available as and when required.
Financing
The Group finances part of its operating through debt. Details of the Group’s existing 
facilities are given in notes 19 and 30. There is the risk that the Group is unable 
to refinance its bank debt or is unable to obtain new or additional debt if required. 
The ability to raise finance is affected by factors outside of the Group’s control such 
as general economic, political and capital market conditions as well as credit availability. 
As noted earlier in the Financial Review, the Group has recently extended its current 
banking facilities to May 2013. 
Environmental issues
The Group’s activities and the markets in which it operates are subject to environmental 
regulation. Such regulations typically cover a wide variety of matters including prevention 
of waste, pollution and protection of the environment. The risk is managed by daily 
inspections of all operations with a potential to cause environmental breaches and 
by careful design of the operations to mitigate any potential risk.
Governance
14–24 ATH Resources plc Annual report and accounts 2011 18 www.ath.co.uk
Directors’ report
The Directors submit their report and the audited financial statements of ATH Resources plc for the year ended 2 October 2011.
Principal activities
The principal activity of the Company is that of a holding company. The principal activity of the Group is the operation of surface coal 
mines and the subsequent sale of coal to UK electricity generators, industrial and domestic customers. The Group operates under the 
title of ATH Resources.
Review of developments and future prospects
A balanced and comprehensive analysis of development and performance of the Group is contained in the Chairman’s Statement, 
the Group Chief Executive’s Statement and Group Finance Director’s Financial Review on pages 4 to 11. This analysis includes 
comments on the position of the Group at the end of the financial period and consideration of the principal risks and uncertainties 
facing the business. The key performance indicators, which are monitored in relation to the achievement of the strategy of the 
business, are set out in this report below.
Statement of Directors’ responsibilities
The Directors are responsible for preparing the Directors’ Report and the financial statements in accordance with applicable law and 
regulations. The Directors are required to prepare the consolidated financial statements in accordance with International Financial 
Reporting Standards (“IFRS”) as adopted by the European Union (“EU”). Company law requires the Directors to prepare such financial 
statements in accordance with IFRS as adopted by the EU and the Companies Act 2006.
In the case of the Company accounts, UK company law requires the Directors to prepare financial statements for each financial year. 
Under that law the Directors have elected to prepare the financial statements in accordance with UK Generally Accepted Accounting 
Practice (United Kingdom Accounting Standards and applicable law). Under company law the Directors must not approve the financial 
statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company as at the end of the 
financial year. In preparing those financial statements, the Directors are required to:
h h select suitable accounting policies and then apply them consistently;
h h make judgments and estimates that are reasonable and prudent;
h h state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and 
explained in the financial statements; and
h h prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will 
continue in business.
In the case of IFRS accounts for the Group, International Accounting Standard 1 requires that financial statements present fairly 
for each financial year the Group’s financial position, financial performance and cash flows. This requires the faithful representation 
of the effects of transactions, other events and conditions in accordance with the definitions and recognition criteria for assets, 
liabilities, income and expenses set out in the International Accounting Standards Board’s ‘Framework for the Preparation and 
Presentation of Financial Statements’.
In virtually all circumstances, a fair presentation will be achieved by compliance with all applicable IFRS as adopted by the EU.
Directors are also required to:
h h properly select and apply accounting policies;
h h present information, including accounting policies, in a manner that provides relevant, reliable, comparable and 
understandable information; and
h h provide additional disclosures when compliance with the specific requirements in IFRS as adopted by the EU is insufficient to 
enable users to understand the impact of particular transactions, other events and conditions on the entity’s financial position 
and financial performance.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s 
transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure 
that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the 
Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the 
ATH Resources plc website. Legislation in the United Kingdom (“UK”) governing the preparation and dissemination of financial 
statements may differ from legislation in other jurisdictions. ATH Resources plc Annual report and accounts 2011 19 www.ath.co.uk
Directors’ indemnities
The Group made third party indemnity provisions for the benefit of its Directors for the whole of the year, which continue to remain 
in force and the Group has taken out third party insurance in respect of these indemnities.
Directors
The Directors in office during the whole period under review and their interests in the ordinary shares of the Company were:
2011
Number
2010
Number
D C Port 214,959 214,959
A Black 316,385 295,106
A Weatherstone (appointed 4 October 2010) 15,000 —
V M F Williams 10,000 1,866
J T Stokeld 100,000 100,000
In addition Mr Tom Allchurch served as a Director until his resignation from the Board on 18 January 2011.
Details of Directors’ share options are provided in the Directors’ Remuneration Report on pages 23 and 24.
Substantial shareholdings
The Company has been informed that on 16 January 2012 the following shareholders held substantial holdings in the issued ordinary 
shares of the Company:
Number of
ordinary
shares
Holding
%
Alchemy Partners Nominees Limited 7,546,059 19
AXA Framlington Investment Management 5,385,000 13
Close Investments 3,883,818 10
Mr W Paterson 2,914,000 7
Cavendish Asset Management 2,350,000 5
Blackrock Smaller Companies Trust plc 1,264,008 3
Mr P Gyllenhammar 1,235,000 3
Statement as to disclosure of information to auditor
The Directors who were in office on the date of approval of these financial statements have confirmed, as far as they are aware, 
that there is no relevant audit information of which the auditor is unaware. Each of the Directors has confirmed that they have taken 
all the steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to 
establish that it has been communicated to the auditor.
Key performance indicators (“KPIs”)
The Board monitors the Group’s progress and financial performance on a regular basis. Performance is assessed against budget using 
financial and non-financial measures. The following are the most significant KPIs used by the Group:
2011 2010
Sales price – revenue earned per tonne of coal sold (£) 50 44
Cost price – operating cost per tonne of coal sold (£) 43 35
Coal reserves – the volume of coal which is classed as proved or probable reserves (million tonnes) 7.9 8.6
Health and safety – reportable accidents (number) 2 4
Environmental incidents – breaches of environmental legislation (number) 0 1
Return on capital employed – profit before exceptional items, interest and tax divided by capital employed (%) 6 11
Governance
14–24 ATH Resources plc Annual report and accounts 2011 20 www.ath.co.uk
Directors’ report
continued
Financial instruments
Details relating to financial instruments are given in note 30.
Employees
The Directors recognise the importance of the Group’s employees in the success of the business.
The Group is committed to equal opportunities in employment and seeks to ensure that all current employees or applicants are 
treated equally regardless of age, sex, nationality, race, colour, creed or disability.
The Directors retain regular contact with employees using both formal and informal lines of communication to ensure relevant 
financial and operational information is disseminated. Regular meetings take place to allow employees of all levels to contribute 
to the Group’s development.
Disabled employees
Applications for employment by disabled persons are always fully considered, bearing in mind the abilities of the applicant 
concerned. In the event of members of staff becoming disabled every effort is made to ensure that their employment with 
the Group continues and that appropriate training is arranged. It is the policy of the Group that the training, career development 
and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Payment policy
It is the Group’s policy to pay suppliers in accordance with agreed terms, provided the supplier has also complied with agreed 
terms and conditions. At 2 October 2011, the trade creditors of the Group represented 40 days (2010: 37 days) of purchases.
Auditor
Baker Tilly UK Audit LLP has indicated its willingness to continue in office as auditor of the Company and a resolution to that 
effect will be proposed at the Annual General Meeting.
By order of the Board
A P Weatherstone
Group Finance Director and Company Secretary
25 January 2012 ATH Resources plc Annual report and accounts 2011 21 www.ath.co.uk
Corporate governance report
Introduction
Although the rules of AIM do not require the Company to comply with the UK Corporate Governance Code (“the Code”), 
the Company fully supports the principles set out in the Code and will attempt to comply wherever possible, given both 
the size and resources available to the Company. Details are provided below of how the Company applies the Code.
The Board
The Board of Directors comprises three Executive Directors and two Non-executive Directors. On 4 October 2010 Mr Andrew Weatherstone 
was appointed as the Group’s Finance Director and Company Secretary. Mr Tom Allchurch stood down from the position of Non-executive 
Director on 18 January 2011.
Mr Vaughan Williams has stated his intention to stand down from the Board with effect from the forthcoming AGM to be held 
on 29 February 2012, at which time the Chairman Mr D C Port will revert to being a Non-executive Director.
The Alchemy Plan has the right to nominate a Non-executive Director but has chosen not to do so. If the Alchemy Plan’s shareholding 
in the Company falls below 10% of the issued share capital, the right to appoint ceases.
The Board generally meets each month and receives a Board pack comprising individual reports from each of the Executive Directors, 
together with any other material deemed necessary for the Board to discharge its duties. It is the Board’s responsibility to formulate, 
review and approve the Group’s strategy, budgets, major items of expenditure and acquisitions.
During the year ended 2 October 2011 the Board met a total of twelve times for regular meetings and a further six times to consider 
other business.
Board committees
The Board has established three committees: Audit, Remuneration and Nominations, all having written terms of delegated responsibilities.
Audit Committee
The Audit Committee comprises the two Non-executive Directors, Mr Vaughan Williams and Mr Tim Stokeld. The Committee is 
scheduled to meet twice a year. It is the Audit Committee’s role to provide formal and transparent arrangements for considering how 
to apply the financial reporting and internal control requirements of the Code, whilst maintaining an appropriate relationship with 
the independent auditor of the Group. Mr D C Port will replace Mr V Williams on the Audit Committee upon Mr V Williams’ retirement.
During the year ended 2 October 2011 the Audit Committee met on two occasions.
Remuneration Committee
The Remuneration Committee comprises the two Non-executive Directors and meets at least once a year, normally in June. It is the 
Remuneration Committee’s role to establish a formal and transparent policy on Executive remuneration and to set remuneration 
packages for individual Directors.
During the year ended 2 October 2011 the Remuneration Committee met on three occasions.
Nominations Committee
The Nominations Committee comprises the two Non-executive Directors and the Chief Executive and meets as required to consider 
and make recommendations on the appointment of Directors to the Board.
Shareholder relations
The Company meets with its institutional shareholders and analysts as appropriate and encourages communication with private 
shareholders via the Annual General Meeting. In addition, the Company uses the Annual Report and Accounts, Interim Statement 
and website (www.ath.co.uk) to provide further information to shareholders.
The Board considers Mr Vaughan Williams to be the Senior Independent Director. Mr Tim Stokeld will become the Senior Independent 
Director upon Mr V Williams’ retirement.
Governance
14–24 ATH Resources plc Annual report and accounts 2011 22 www.ath.co.uk
Corporate governance report
continued
Internal control and risk management
The Board is responsible for the system of internal control and for reviewing its effectiveness. Such systems are designed to manage 
rather than eliminate risks and can provide only reasonable and not absolute assurance against material misstatement or loss. 
Each year, on behalf of the Board, the Audit Committee reviews the effectiveness of these systems. This is achieved primarily by 
considering the risks potentially affecting the Group and discussions with the external auditor.
The Group does not currently have an internal audit function due to the small size of the administrative function and the high level 
of Director review and authorisation of transactions.
A comprehensive budgeting process is completed once a year and is reviewed and approved by the Board. The Group’s results, 
as compared against budget, are reported to the Board on a monthly basis and discussed in detail at each meeting of the Board.
The Group maintains appropriate insurance cover in respect of legal actions against the Directors, as well as against material loss 
or claims against the Group, and reviews the adequacy of the cover regularly.
Financial instruments
Details of the Group’s financial instruments and associated policies are set out in note 30.
Going concern basis
These financial statements are prepared on the basis that the Group is a going concern. In forming its opinion as to going concern 
the Board have taken into account the material uncertainties set out on page 31. ATH Resources plc Annual report and accounts 2011 23 www.ath.co.uk
Remuneration committee report
Introduction
Companies trading on AIM are not required to provide a full formal remuneration report, only disclosure as to the remuneration 
earned in respect of the financial year by each director acting in such capacity during the financial year. However, in line with current 
best practice, this report provides information to enable a greater level of understanding as to how Directors’ remuneration is 
determined. The Remuneration Committee of the Board is responsible for considering Directors’ remuneration packages and makes 
its recommendations to the Board. The Committee comprises the two Non-executive Directors and meets at least once a year, 
normally in June.
Remuneration policy
Remuneration packages after taking advice from independent remuneration consultants are designed to be competitive and 
to reward above average performance. Executive Directors receive salary, a fully financed company car or car allowance, death 
in service benefit, critical illness and medical cover, pension contribution, annual bonuses and share options.
Service contracts
Mr Alistair Black’s agreement is dated 14 June 2011 terminable upon twelve months’ notice being given by either party. Mr David Port 
entered into a letter of appointment dated 12 May 2004, amended on 6 December 2011 to reflect Mr Port’s appointment as 
Executive Chairman, which requires twelve months’ notice to be given by either party. Mr Andrew Weatherstone has a service 
agreement dated 13 June 2011 also terminable upon twelve months’ notice being given by either party.
Non-executive Directors
Mr Vaughan Williams entered into a letter of appointment dated 12 May 2004 which was renewed in October 2009. Mr Williams 
was appointed for an initial three year term, which can be terminated upon six months’ notice being given by either party. Mr Tim Stokeld 
was appointed as an Independent Non-executive Director on 6 May 2009 and the appointment is subject to an annual review and 
can be terminated upon three months’ notice being given by either party.
Following the sale of the ATH Regeneration assets, the Group entered into an arrangement with RecyCoal Limited for the provision 
of the services of Mr Tom Allchurch as a Non-executive Director which was terminated on the resignation of Mr Allchurch on 
18 January 2011.
Pensions
The Group does not have a pension scheme; instead it makes contributions to Executive Directors’ personal pension schemes 
of 12.5% of annual salary.
Directors’ remuneration
Details of Directors’ remuneration are set out below:
Salary
£000
Benefits
£000
Bonus
£000
Subtotal
emoluments
£000
Pension
£000
2011
Total
£000
2010
Total
£000
Executive Directors
D C Port (from June 2010) 141 — — 141 — 141 45
T J Allchurch — — — — — — 220
A Black 183 17 18 218 23 241 185
A Weatherstone 159 1 — 160 19 179 —
S Beaumont (resigned 30 September 2010) — — — — — — 250
Non-executive Directors
D C Port — — — — — — 47
T J Allchurch (from 1 August 2010) 8 — — 8 — 8 4
V M F Williams 31 — — 31 — 31 31
J T Stokeld 26 — — 26 — 26 26
Total 548 18 18 584 42 626 808
Mr Stokeld’s fee was paid to a third party company and Mr Allchurch’s fee was paid to RecyCoal Limited. Mr Port’s and Mr Weatherstone’s 
salaries include cash allowances of £10,500 and £9,300 respectively in lieu of a company car.
Mr Black elected to take his bonus of £17,500 as additional pension contributions.
Governance
14–24 ATH Resources plc Annual report and accounts 2011 24 www.ath.co.uk
Remuneration committee report
continued
Performance incentives
The Group operates an annual cash bonus scheme and grants share options.
The annual bonus scheme for the Chief Executive provides for a maximum bonus of 40% of salary to be paid by reference to 
achievement of a Group earnings target (10%) and surpassing the earnings target (10%) and individual personal targets (20%). 
The annual bonus scheme for the Group Finance Director provides for a maximum bonus of 37% to be paid by reference to 
a Group earnings target (10%) and surpassing earnings target (10%) and individual personal targets (17%).
In addition the Chairman and Chief Executive are incentivised to ensure the legacy contracts are fulfilled as quickly as possible and 
are eligible to earn up to £75,000 and £170,000, respectively, payable in three equal instalments on the completion of each of the 
three remaining legacy contracts.
The Company has the following share incentive arrangements:
h h an Inland Revenue Approved Executive Share Option Scheme (“Approved Scheme”);
h h an Unapproved Executive Share Option Scheme (“Unapproved Scheme”); and
h h a Long Term Incentive Plan (“LTIP”) (together “the Schemes”).
None of the option shares or LTIP requires payment to be made by participants to receive the benefit of an option.
Directors’ interests in share options
The options and awards have been granted pursuant to the Schemes to the following Directors:
Number of share options Performance period
Performance
Exercisable
Exercise
price
3 October
2010 Granted Lapsed 
2 October
2011 from to
target
(pence) from to
A Black
Approved £1.46 20,471 — — 20,471 1 Oct 03 30 Sep 06 (1) 2 Nov 07 31 Oct 14
Unapproved £1.33 153,513 — — 153,513 1 Oct 03 30 Sep 06 (1) 12 Jun 07 10 Jun 14
Unapproved £1.85 41,068 — — 41,068 1 Oct 04 30 Sep 07 (1) 30 Sep 08 28 Sep 15
Unapproved £2.05 66,341 — — 66,341 — — None 15 Jan 11 15 Jan 18
Unapproved £0.8125 139,870 — — 139,870 1 Oct 09 30 Sep 12 (3) 20 Jan 13 20 Jan 15
LTIP £1.70 41,068 — — 41,068 1 Oct 04 30 Sep 08 (1) 30 Sep 10 28 Sep 15
LTIP £0.01 66,341 — (66,341) — 1 Oct 07 30 Sep 10 (2) 15 Jan 11 15 Jan 18
LTIP £0.01 139,870 — — 139,870 1 Oct 09 30 Sep 12 (2) 20 Jan 13 20 Jan 20
LTIP £0.01 — 205,000 — 205,000 20 Jan 11 20 Jan 14 (4) 20 Jan 14 20 Jan 21
Total 668,542 205,000 (66,341) 807,201     
A Weatherstone 
LTIP £0.01 — 175,000 — 175,000 20 Jan 11 20 Jan 14 (4) 20 Jan 14 20 Jan 21
Total — 175,000 — 175,000   
(1)  The performance criteria on these options relates to cumulative pre-tax earnings per share. 
(2)  The LTIP options have an average annual percentage growth in pre-tax earnings per share performance target and will vest as follows:
Average annual growth in pre-tax earnings per share Proportion of options that will vest
Over 10% 100%
Between 7.5% and 10% 75%
Between 5% and 7.5% 50%
Under 5% Nil
(3)  The unapproved options have an average annual percentage growth in pre-tax earnings per share performance target and will only vest if the average annual 
growth in EPS is greater than 4%.
(4)  The LTIP options have a total shareholder return performance target and will only vest if there is a 15% per annum compound growth in total shareholder 
return, equivalent to a share price of 106 pence on 20 January 2014.
No Directors exercised any options during the period.
V M F Williams
Chairman of the Remuneration Committee
25 January 2012 25 ATH Resources plc Annual report and accounts 2011 www.ath.co.uk
Group and Company 
financial statements
Accounts
26  Independent auditor’s report for the 
Group accounts
27 Consolidated income statement
28 Consolidated balance sheet
29  Consolidated statement of changes 
in equity
30  Consolidated cash flow statement
31 Group accounting policies
37  Notes to the Group financial statements
55  Independent auditor’s report for the 
Company accounts
56 Company balance sheet
57 Company accounting policies
58  Notes to the Company financial statements
60  Notice of annual general meeting
63 Form of proxy
Accounts
for the year ended 2 October 2011 ATH Resources plc Annual report and accounts 2011 26 www.ath.co.uk
Independent auditor’s report
to the member of ATH Resources plc
We have audited the consolidated financial statements which comprise the Consolidated Income Statement, the Consolidated 
Balance Sheet, the Consolidated Cash Flow Statement, the Consolidated Statement of Changes in Equity and the related notes. 
The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting 
Standards (“IFRS”) as adopted by the European Union.
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. 
Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to 
them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility 
to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions 
we have formed.
Respective responsibilities of Directors and auditor
As more fully explained in the Directors’ Responsibilities Statement set out on page 18, the Directors are responsible for the preparation 
of the consolidated financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and 
express an opinion on the consolidated financial statements in accordance with applicable law and International Standards on Auditing 
(UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.
Scope of the audit of the consolidated financial statements
A description of the scope of an audit of financial statements is provided on the APB’s website at www.frc.org.uk/apb/scope/private.CFM.
Opinion on the consolidated financial statements
In our opinion the consolidated financial statements:
h h give a true and fair view of the state of the Group’s affairs as at 2 October 2011 and of the Group’s loss for the year then ended;
h h have been properly prepared in accordance with IFRS as adopted by the European Union; and
h h have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion the information given in the Directors’ Report for the financial year for which the consolidated financial statements 
are prepared is consistent with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report 
to you if, in our opinion:
h h certain disclosures of Directors’ remuneration specified by law are not made; or
h h we have not received all the information and explanations we require for our audit.
Andrew Allchin (Senior Statutory Auditor)
For and on behalf of Baker Tilly UK Audit LLP
Statutory Auditor
Chartered Accountants
2 Whitehall Quay
Leeds LS1 4HG
25 January 2012 ATH Resources plc Annual report and accounts 2011 27 www.ath.co.uk
Consolidated income statement
for the year ended 2 October 2011
2011 2010
Note
Before
exceptional
items
£000
Exceptional
operating
items
£000
Total
£000
Before
exceptional
items
£000
Exceptional
operating
items
£000
Total
£000
Continuing operations
Revenue 3 84,166 — 84,166 78,307 — 78,307
Cost of sales (71,434) (6,230) (77,664) (62,520) — (62,520)
Gross profit 12,732 (6,230) 6,502 15,787 — 15,787
Other operating income 5 2,082 — 2,082 73 — 73
Administrative expenses (10,139) — (10,139) (8,906) — (8,906)
Impairment of goodwill (1,650) — (1,650) — — —
Operating profit/(loss) 3,025 (6,230) (3,205) 6,954 — 6,954
Finance costs 8 (2,641) — (2,641) (2,966) — (2,966)
Profit/(loss) before taxation 384 (6,230) (5,846) 3,988 — 3,988
Tax (expense)/credit 10 (410) 1,628 1,218 (1,461) — (1,461)
(Loss)/profit for the year  
from continuing operations 7 (26) (4,602) (4,628) 2,527 — 2,527
Discontinued operations
Loss for the year from discontinued operations 11 — — — (4,294) — (4,294)
Loss for the year attributable to ordinary shareholders 23 (26) (4,602) (4,628) (1,767) — (1,767)
(Loss)/earnings per share
From continuing and discontinued operations
Basic 12 (11.5)p (4.4)p
Diluted 12 (11.5)p (4.4)p
From continuing operations
Basic 12 (11.5)p 6.3p
Diluted 12 (11.5)p 6.2p
There is no income or expense other than as stated in the consolidated income statement.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 28 www.ath.co.uk
Consolidated balance sheet
as at 2 October 2011
Company number 4928463
Note
2011
£000
2010
£000
ASSETS
Non-current assets
Intangible assets 13 3,763 5,413
Property, plant and equipment 14 67,214 67,097
70,977 72,510
Current assets
Inventories 16 11,463 11,925
Trade and other receivables 17 14,988 11,257
Cash and cash equivalents 498 2,353
26,949 25,535
Total assets 97,926 98,045
LIABILITIES
Current liabilities
Trade and other payables 18 (15,155) (11,227)
Tax liabilities — (407)
Financial liabilities 19 (5,617) (6,335)
Final void provision 20 (3,048) (2,315)
(23,820) (20,284)
Non-current liabilities
Financial liabilities 19 (26,175) (30,309)
Final void provision 20 (23,706) (16,498)
Deferred tax liabilities 20 (2,008) (3,254)
(51,889) (50,061)
Total liabilities (75,709) (70,345)
Net assets 22,217 27,700
EQUITY 
Share capital 21 200 200
Share premium 23 27,855 27,855
Retained losses 23 (5,838) (355)
Total equity 22,217 27,700
The financial statements on pages 27 to 54 were approved by the Board of Directors and authorised for issue on 25 January 2012 
and are signed on its behalf by:
A P Weatherstone
Group Finance Director ATH Resources plc Annual report and accounts 2011 29 www.ath.co.uk
Consolidated statement of changes in equity
for the year ended 2 October 2011
Called up 
share
capital
£000
Share
premium
account 
£000
Retained
earnings
£000
Total
equity
shareholders’
funds
£000
At 4 October 2009 200 27,855 4,205 32,260
Loss for the year — — (1,767) (1,767)
Other comprehensive income for the year — — — —
Total comprehensive income for the year — — (1,767) (1,767)
Transactions with equity shareholders
Adjustment in respect of share-based payments — — 72 72
Dividends paid — — (2,865) (2,865)
Total transactions with equity shareholders — — (2,793) (2,793)
At 3 October 2010 200 27,855 (355) 27,700
Loss for the year — — (4,628) (4,628)
Other comprehensive income for the year — — — —
Total comprehensive income for the year — — (4,628) (4,628)
Transactions with equity shareholders
Adjustment in respect of share-based payments — — (54) (54)
Dividends paid — — (801) (801)
Total transactions with equity shareholders — — (855) (855)
At 2 October 2011 200 27,855 (5,838) 22,217
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 30 www.ath.co.uk
Consolidated cash flow statement
for the year ended 2 October 2011
Note
2011
£000
2010
£000
Cash flows from operating activities
Cash generated from operations 28 16,172 12,736
Interest paid (1,957) (2,058)
Tax paid (435) (1,806)
Net cash from operating activities 13,780 8,872
Cash flows from investing activities
Proceeds from sale of property, plant and equipment 561 438
Net proceeds from the sale of ATH Regeneration assets — 6,258
Purchases of property, plant and equipment (10,585) (7,288)
Net cash used in investing activities (10,024) (592)
Cash flows from financing activities
Dividends paid (801) (2,865)
Repayment of borrowings (1,000) (14,335)
Payment of finance lease liabilities (8,076) (11,247)
New asset-backed finance raised 4,266 8,501
Drawings from new revolving credit facility — 19,238
Net cash used in financing activities (5,611) (708)
Net (decrease)/increase in cash and cash equivalents (1,855) 7,572
Cash and cash equivalents at beginning of year 2,353 (5,219)
Cash and cash equivalents at end of year 28 498 2,353 ATH Resources plc Annual report and accounts 2011 31 www.ath.co.uk
Group accounting policies
The Group’s principal accounting policies, which have been applied consistently to all years presented, are set out below.
Basis of accounting
The financial statements have been prepared in accordance with IFRS adopted by the EU.
The financial statements have been prepared on the historical cost basis, except for the revaluation of certain financial instruments, 
which are carried at fair value. The principal accounting policies adopted are set out below. 
Going concern basis
These financial statements are prepared on the basis that the Group is a going concern. In forming its opinion as to going concern, 
the Board prepares forecasts and projections based upon detailed assumptions in particular with regard to levels of coal production 
and the principal risks and uncertainties as set out on pages 16 and 17, together with the level of borrowings and other facilities 
made available to the Group. The Board also takes account of reasonable possible changes in trading performance to determine 
whether the Group should be able to operate within its current level of facilities. Key factors that have been considered are:
h h recent performance has demonstrated the impact of unpredictable geological conditions on production volumes. Given that 
a significant proportion of the Group’s volumes are phased to legacy contracts at prices significantly below market prices 
other shortfalls of production tend to impact on levels of higher market priced coal leading to a potential material adverse 
impact on cash and profitability;
h h the Group requires adequate restoration bond facilities to continue to operate both existing and new sites. Recently the 
number of bond providers providing surety in this market has reduced with one withdrawing from the market completely 
and another significantly curtailing its participation. Shortage of bond facilities could lead to the Group not being able to 
operate at its planned levels of production. Failure to renew a bond could result in a claim on the Group under the terms 
of its counter indemnities given to its bond providers. The Group has been in discussions with its existing providers and they 
are willing to provide additional facilities which should be sufficient to allow the Group to renew its bonding requirement as 
they fall due in the next 12 months;
h h bank facilities have recently been renegotiated, providing a facility through to 31 May 2013. The facility is at a level 
of £23.5 million, with scheduled reductions commencing May 2012 onwards reducing the facility to £19 million by 
September 2012 and then to £16 million in April 2013. These facilities contain performance covenants including interest 
cover, debt to borrowing ratio and debt service ratio, which if breached could lead to a need to renegotiate terms or, 
in the extreme case, a reduction or withdrawal of the facilities concerned; and
h h sales price in respect of a number of contracts are floating and based upon the international price of coal, creating a risk 
of unpredictability in revenues and cash.
 The Board recognises the material uncertainties noted above but, based upon information available to it at the date of approval 
of these financial statements, confirms its belief that it is appropriate to use the going concern basis of preparation for these 
financial statements. The financial statements do not include any adjustments that would result from this not being the case.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of ATH Resources plc and entities controlled by the 
Company made up to the end of September each year. Control is achieved where the Company has the power to govern the 
financial and operating policies of an investee entity so as to obtain benefits from its activities.
Aardvark TMC Limited (“Aardvark”) has 20,000 “B” ordinary shares not owned by ATH Resources plc, subscribed at their nominal 
value of 1 pence each in addition to the ordinary shares wholly owned by ATH Resources plc.
The “B” ordinary shares only carry the rights to receive a one off dividend in the event that Aardvark TFC Limited or SRMMC 
(Aardvark’s subsidiary and sub-subsidiary) are awarded damages in respect of existing and future litigation against the French State. 
The “B” ordinary shares carry no voting rights or rights to receive any other dividend. As a result, the “B” ordinary shares are not 
accounted for as a non-controlling interest as it is not material for the purposes of giving a true and fair view.
The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the 
effective date of acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line 
with those used by the Group.
All intra-group transactions, balances, income and expenses are eliminated on consolidation.
Discontinued operations
A discontinued operation is a component of the Group that has either been disposed of, or is classified as being held for sale and 
represents a separate major line of business, is part of a single co-ordinated plan to dispose of a separate major line of business 
or is a subsidiary acquired exclusively with a view to resale.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 32 www.ath.co.uk
Group accounting policies
continued
Segment reporting
A business segment is a group of assets and operations engaged in producing coal using production methods that are substantially 
different to other business segments. A geographical segment produces coal in a particular economic environment that is subject 
to different risks and returns from those of segments operating in other economic environments.
Segment reporting information is detailed in note 2 of the Group financial statements.
Revenue recognition
Revenue from the sale of coal is recognised when the risks and rewards of ownership have passed to the customer. This is usually 
when the coal is delivered to the location specified by the customer, generally on loading into transport where the customer is 
responsible for the transportation. Revenue is measured at the fair value of the consideration received or receivable and is shown 
net of discounts, VAT and other sales-related taxes.
Royalties receivable
Royalty income relates to the licence of the Group’s coal washing technology. The income is recognised on an accruals basis based 
on the performance of the licensee.
Exceptional items
Items that are non-recurring and whose significance is sufficient to warrant separate disclosure and identification within the financial 
statements are disclosed as exceptional items within their relevant income statement category.
Retirement benefit costs
The Group only makes payments to defined contribution retirement benefit schemes, which are charged as an expense as they fall due.
Borrowing costs
All borrowing costs are recognised in the consolidated income statement in the period in which they are incurred.
Dividends
Dividends are recorded in the Group’s financial statements in the period in which they are declared and paid.
Taxation
Income tax on the profit or loss for the periods presented comprises both current and deferred tax. Income tax is recognised 
in the consolidated income statement except to the extent that it relates to items recognised directly in equity, in which case 
it is recognised in the consolidated statement of changes in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates that have been enacted or substantively 
enacted by the balance sheet date and any adjustment to tax payable in respect of previous years.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the consolidated 
income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes 
items that are never taxable or deductible.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities 
in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using 
the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred 
tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary 
differences can be utilised.
The following temporary differences are not provided for in accordance with IFRS:
h h goodwill not deductible for taxation purposes;
h h initial recognition of assets or liabilities that affect neither accounting nor taxable profit; and
h h differences relating to investments in subsidiaries to the extent that these will probably not reverse in the foreseeable future.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised 
using tax rates enacted or substantively enacted by the balance sheet date.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current 
tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its 
current tax assets and liabilities on a net basis. ATH Resources plc Annual report and accounts 2011 33 www.ath.co.uk
Government grants
Government grants relating to property, plant and equipment are released to profit or loss over the expected useful lives of the 
assets concerned. The grant received is deducted from the carrying amount of the asset and the income is recognised by way of 
a reduced depreciation charge. The consolidated cash flow statement discloses the purchase of assets and the receipt of related 
grants as separate items.
Share-based payments
The Group issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are measured at 
fair value (excluding the effect of non market-based vesting conditions) at the date of grant. The fair value determined at the grant 
date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group’s 
estimate of shares that will eventually vest and adjusted for the effect of non market-based vesting conditions. Fair value is measured 
by use of either a Black-Scholes or Monte Carlo model.
Goodwill and business combinations
The acquisition of subsidiaries is accounted for using the purchase method. For acquisitions prior to 4 October 2009, the cost of the 
acquisition is measured at the aggregate of the fair values at the date of exchange of assets given, liabilities incurred or assumed and 
equity instruments issued by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business 
combination. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under 
IFRS 3 are recognised at their fair value at the acquisition date.
Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the fair value of the 
identifiable assets and liabilities of a subsidiary at the date of acquisition. Goodwill is initially recognised as an asset at cost and is 
subsequently measured at cost less any accumulated impairment losses. Negative goodwill arising on an acquisition is recognised 
immediately in the consolidated income statement.
Goodwill, which is recognised as an asset, is reviewed for impairment at least annually. Any impairment is recognised immediately 
in the consolidated income statement and is not subsequently reversed. For the purpose of impairment testing, goodwill is allocated 
to each of the Group’s cash-generating units (“CGUs”) expected to benefit from the synergies of the combination. CGUs to which 
goodwill has been allocated are tested for impairment annually, or more frequently when there is an indication that the unit may 
be impaired. If the recoverable amount of the CGU is less than the carrying amount of the unit, the impairment loss is allocated first 
to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata on the basis 
of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period.
On disposal of a subsidiary the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
Property, plant and equipment
All property, plant and equipment is stated at cost less accumulated depreciation and any recognised impairment loss. Depreciation 
commences when the asset is brought into use or, in the case of mine purchase and development costs, on the commencement of 
full production.
Mine exploration and development costs are expensed until such time that the Group has the legal rights to explore the prospective 
site. Exploration and evaluation costs, incurred after legal rights are obtained, are capitalised and subsequently impaired if facts and 
circumstances indicate that the site is not commercially viable and will not therefore be worked.
Costs incurred in preparing and developing sites which are considered commercially viable and technically feasible are capitalised up to 
the start of production of coal at expected operating levels. The income from incidental coal that is extracted during the development 
phase is included within the income statement together with the direct costs of production.
Depreciation is charged so as to write off the cost of assets less estimated residual value, over their estimated useful lives, in annual 
instalments, on the following bases:
Freehold land:   not depreciated 
Freehold buildings:  4% 
Investment property  not depreciated 
Mine purchase and development: tonnage basis over the estimated total recoverable reserve 
Plant and machinery:  7–50%
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or over the term 
of the relevant lease.
The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the 
carrying amount of the asset and is recognised in income.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 34 www.ath.co.uk
Group accounting policies
continued
Impairment of plant, property and equipment and intangible assets excluding goodwill
At each balance sheet date, the Group reviews the carrying amounts of its plant, property and equipment and intangible assets 
to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the 
recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does 
not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the CGU to which 
the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash 
flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value 
of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset 
(CGU) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately.
Where an impairment loss subsequently reverses, the carrying amount of the asset (CGU) is increased to the revised estimate of 
its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been 
determined had no impairment loss been recognised for the asset (CGU) in prior years. A reversal of an impairment loss is recognised 
as income immediately.
Leasing
The Group only acts as a lessee. Leases are classified as finance leases whenever the terms of the lease transfer substantially all the 
risks and rewards of ownership. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets of the Group at their fair value or, at the present value of the minimum lease 
payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the consolidated balance 
sheet as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation so 
as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income.
Rentals payable under operating leases are charged to income on a straight-line basis over the term of the relevant lease.
Inventories
Inventories include coal stocks, work in progress and spare parts and tyres stated at the lower of cost and net realisable value.
Coal inventories
Coal inventories are mined inventories to hand. Cost comprises direct materials, plant costs, direct labour and relevant overheads 
that have been incurred in bringing the coal to its present location and condition. Cost is calculated using the weighted average 
method. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred 
in marketing, selling and distribution.
Work in progress
Work in progress represents the costs incurred on mining operations where the coal has not yet been extracted from the ground. 
Cost comprises direct materials, plant costs, direct labour and relevant overheads that have been incurred in removing the overburden 
on site. Cost is calculated using the weighted average method over the period represented by the volume of work in progress on hand.
The Group assesses the volume of overburden moved on a site or site extension at the end of a period and compares this to the 
volume that would be expected to be moved had coal been mined at exactly the expected ratio of overburden to coal. Where the 
actual volume of overburden moved on a site or site extension is greater than the volume expected at the site ratio, the excess is 
classified as work in progress.
Financial instruments
Financial assets and financial liabilities are recognised in the consolidated balance sheet when the Group becomes a party to the 
contractual provisions of the instrument, and are only derecognised when the contractual provisions expire or have been discharged, 
or substantially all the risks and rewards of ownership have been transferred.
Financial assets
Financial assets are principally made up of items classified under IFRS as “loans and receivables”. The classification depends on the 
nature and purpose of the financial assets and is determined at the time of initial recognition.
Loans and receivables constitute trade receivables, loans and other receivables that have fixed or determinable payments that are 
not quoted in an active market. Loans and receivables are measured at amortised cost using the effective interest method, less any 
impairment. Interest income is recognised by applying the effective interest rate, except for short term receivables when the 
recognition of interest would be immaterial.
These financial assets are assessed for indicators of impairment at each balance sheet date. Financial assets are impaired where 
there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, 
its estimated future cash flows have been impacted. ATH Resources plc Annual report and accounts 2011 35 www.ath.co.uk
Financial assets continued
For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired individually are subsequently 
assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the Group’s 
past experience of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit period 
of 60 days, as well as observable changes in national or local economic conditions that correlate with default on receivables.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception 
of trade receivables, where the carrying amount is reduced through the use of an allowance for bad debts. When a trade receivable 
is considered uncollectible, it is written off against the allowance for bad debts. Subsequent recoveries of amounts previously written 
off are credited against the allowance for bad debts. Changes in the carrying amount of the allowance account are recognised 
in the consolidated income statement.
Cash and cash equivalents
Cash and cash equivalents comprise cash at hand, cash on demand deposits and other short term highly liquid investments that 
are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.
Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. 
Equity instruments issued by the Group are recorded at the proceeds received, net of direct issue costs.
Financial liabilities
Financial liabilities are classified as either financial liabilities at “fair value through profit or loss” (“FVTPL”) or “other financial liabilities”.
Financial liabilities are classified as FVTPL where the financial liability is either held for trading or it is designated as at FVTPL.
Other financial liabilities, including borrowings and trade and other payables, are initially measured at fair value, net of transaction 
costs. Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest 
expense recognised on an effective yield basis. The effective interest method is a method of calculating the amortised cost of 
a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly 
discounts estimated future cash payments through the expected life of the financial liability or, where appropriate, a shorter period.
Provisions
Provisions are recognised when the Group has a present obligation as a result of a past event and it is probable that the Group will 
be required to settle that obligation. Provisions are measured at the Directors’ best estimate of the expenditure required to settle 
the obligation at the balance sheet date and are discounted to present value where the effect is material.
Final void provisions
Following the conclusion of coal extraction the final working void of a surface mine site must be back filled. The cost of this operation 
is recognised as a provision as the obligation arises. The amount provided represents the present value of the expected costs. Costs 
are charged to the provision as incurred and the unwinding of the discount, being the difference between the present value and 
the total cost of the provision, is included in the interest charge for the period. An asset is created for an amount equivalent to the 
provision and this is depreciated to the income statement on a tonnage basis over the estimated life of the recoverable reserves.
Adoption of new and revised IFRS
The following new standards and amendments to standards are mandatory for the first time for the financial year beginning 
4 October 2010 and are relevant to the Group financial statements.
IFRIC 19 ‘Extinguishing Financial Liabilities with Equity Instruments’
The adoption of this interpretation has had no impact on the financial statement.
IFRS 2 ‘Share-based Payment’ (amendment)
The adoption of this amended standard has had no impact on the financial statements.
At the date of approval of these financial statements the following revised standards, amended standards and interpretations, 
which have not been applied in these financial statements, were in issue but not yet effective:
h h IAS 24 ‘Related Party Disclosure’
h h IFRIC 14 ‘Prepayments of a Minimum Funding Requirement’ (amendment)
h h IFRS 1 ‘Removal of Fixed Dates for First-time Adopters’ (amendment)
h h IFRS 7 ‘Financial Instruments: Disclosure’ (amendment)
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 36 www.ath.co.uk
Group accounting policies
continued
IFRS 2 ‘Share-based Payment’ (amendment) continued
h h IAS 12 ‘Deferred Tax: Recovery of Underlying Assets’ (amendment);
h h IAS 1 ‘Presentation of Financial Statements’ (amendment);
h h IAS 19 ‘Employee Benefits’ (amendment);
h h IFRS 9 ‘Financial Instruments’;
h h IFRS 10 ‘Consolidated Financial Instruments’;
h h IFRS 11 ‘Joint Arrangements’;
h h IFRS 12 ‘Disclosure of Interests in Other Entities’;
h h IAS 27 ‘Separate Financial Statements’ (amendment);
h h IAS 28 ‘Investments in Associates and Joint Ventures’ (amendment);
h h IFRS 13 ‘Fair Value Measurement’;
h h IFRIC 20 ‘Stripping Costs in the Production Phase of a Surface Mine’; and
h h Improvements to IFRSs issued May 2010.
IFRIC 20 ‘Stripping Costs in the Production Phase of a Surface Mine’
On 19 October 2011 IFRIC 20 ‘Stripping Costs in the Production Phase of a Surface Mine’ was published and is applicable 
to accounting periods commencing after 1 January 2013.
IFRIC 20 states that the costs of a stripping activity which provides a benefit in the form of access to coal should be recognised as 
a non-current “stripping activity asset”. This will then be depreciated over the useful economic life of the coal that has become more 
accessible as a result of the stripping activity. In order for such costs to be capitalised there needs to be demonstrable and measurable 
future economic benefit.
The Group currently assesses the value of such stripping costs by comparing costs incurred to date to the average expected for the 
site and allocates cost to be carried forward to match against future coal production where costs incurred have been in excess of the 
average. These deferred costs are currently classified as work in progress and included within inventories as a current asset.
Under IFRIC 20 the Group will be required to reclassify its work in progress asset from current to non–current assets and amortise this 
asset over the expected production of coal from the site.
Critical accounting estimates and judgments
The Group makes estimates and assumptions concerning the future. Due to the nature of an estimate, the eventual actual result 
will rarely equal the amount originally estimated. The estimates and assumptions that have significant risk of causing a material 
misstatement within the financial statements are discussed below.
Coal reserves, overburden and coal ratio
Each working and prospective mine has overlaying rock strata that must be removed before the in-situ coal seams can be accessed. 
The volume of overburden rock compared to coal tonnage in a site is classified as the site ratio. The site ratio for each mine 
is assessed through the examination of drilled cores and extrapolation using experience and detailed modelling techniques.
Capitalised mine purchase and development costs are amortised over the tonnage of coal expected to be extracted in the future, 
which has been calculated through the assessment of the site ratio, management experience and geo-technical findings. If the 
amount of coal expected to be extracted varies this will impact on the amount of the asset which should be carried in the 
consolidated balance sheet.
Work in progress balances are based on an analysis of the remaining coal and overburden volumes in the mine or mine extension 
at the period end. If the amount of remaining coal or overburden varies, this will impact on the work in progress volume that 
should be carried in the consolidated balance sheet.
Restoration and closure provisions
Management exercises significant judgment in the determination of the provisions for the costs required in respect of restoring 
the final void and site to an agreed condition. Amounts provided are based on management experience and historical outturns.
Estimated provisions are established in the consolidated balance sheet and amortised in proportion to the coal expected to be 
extracted from a site. If that expected tonnage or the actual cost varies, then the provision may be under or overstated. Final void 
provision values are assessed using experience and detailed restoration plans. The Group appoints independent experts to review 
the carrying value of final void provisions on an annual basis. The provisions are disclosed in note 20.
Goodwill impairment
Determining whether goodwill is impaired requires an estimation of the value in use of the CGU to which these assets have been 
allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the CGU and 
a suitable discount rate in order to calculate present value. Goodwill is disclosed in note 13. ATH Resources plc Annual report and accounts 2011 37 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011
1 General information
ATH Resources plc is a company incorporated in the UK under the Companies Act 2006. The address of the registered office 
is given on page 14. The nature of the Group’s operations and its principal activities are set out in the Directors’ Report.
These financial statements are presented in pounds sterling because that is the currency of the primary economic environment 
in which the Group operates.
2 Segmental reporting
The chief operating decision-maker has been identified as the Board of Directors (“the Board”). The Board reviews the Group’s 
internal reporting in order to assess performance and allocate resources. Until 29 July 2010, the Group was organised into two 
reportable segments: surface mining and regeneration. Following the sale of the business assets of ATH Regeneration, surface 
mining became the Group’s sole business segment.
The Board considers the business from a type of operations aspect and that all operations are carried out in one geographical 
segment, being the UK.
The nature of the segmental business operations is set out below.
Continuing operations
Surface Mining – the development, operation and restoration of surface coal mines within the UK and the sale of coal to the 
electricity generation, industrial and domestic markets.
Discontinued operations
Coal Tip Washing – the extraction of coal from redundant coal tips and its sale to UK electricity generators through the construction 
and operation of specialist processing plant. Results for discontinued operations are disclosed in note 11.
The Board assesses the performance of the operating segments based on a measure of operating profit. Finance costs and taxation 
are not included in the segment result assessed by the Board.
2011 2010
Income statement
Surface 
Mining
£000
Discontinued
operations
£000
Group
£000
Surface
Mining
£000
Discontinued
operations
£000
Group
£000
Revenue
Total revenue 84,166 — 84,166 78,307 — 78,307
Result
Segment result – operating profit before exceptional items 3,025 — 3,025 7,834 (880) 6,954
Exceptional operating items (6,230) — (6,230) — — —
Segmental result – operating (loss)/profit (3,205) — (3,205) 7,834 (880) 6,954
Finance costs (2,641) (2,966)
(Loss)/profit before tax (5,846) 3,988
Tax income/(expense) 1,218 (1,461)
(Loss)/profit after tax (4,628) 2,527
Balance sheet 
Assets
Segment assets 97,926 — 97,926 92,370 5,675 98,045
Liabilities
Segment liabilities (75,709) — (75,709) (59,189) (11,156) (70,345)
Other information
Capital additions 10,585 — 10,585 4,045 3,243 7,288
Depreciation 13,977 — 13,977 13,564 194 13,758
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 38 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
2 Segmental reporting continued
Information about major customers
Included in revenues from Surface Mining are transactions with the following customers which each comprise over 10% of total revenue:
2011
£000
2010
£000
Customer 1 16,728 13,242
Customer 2 14,066 9,306
Customer 3 12,055 11,410
Customer 4 9,055 16,193
3 Revenue
The Group’s revenue is analysed as follows:
2011
£000
2010
£000
Continuing operations
Sales of goods 84,166 78,307
Other operating income (note 5) 2,082 73
86,248 78,380
Discontinued operations
Other operating income — 11
86,248 78,391
Included within the sales of goods is an amount of £3,582,000 relating to coal extracted prior to the commencement of full production.
4 Sales contracts
In the ordinary course of business the Group has entered into fixed price sales contracts of more than twelve months’ duration with 
varying duration and price. At 2 October 2011 the Group had 1,762,000 tonnes secured under three fixed-price contracts at an average 
selling price of £34 per tonne. It is expected that the first of these fixed price contracts will be fulfilled by 31 March 2012.
In addition the Group has a number of contracts which vary in line with the international price of coal. At 2 October 2011 the 
Group had 739,000 tonnes secured under such contracts.
Selling prices in respect of all sales contracts are regularly compared to the marginal cost of producing coal and, if necessary, 
provisions made for any onerous contracts. Currently the Board believes that no such provisions are required.
5 Other operating income – continuing operations
2011
£000
2010
£000
Royalties receivable 2,000 —
Other operating income 82 73
2,082 73
6 Exceptional operating items – continuing operations
During the year the Group has incurred the following exceptional operating items:
2011
£000
2010
£000
Write off of work in progress in respect of the Glenmuckloch and Muir Dean sites 4,067 —
Increase in provision for future restoration work 1,563 —
Provision for additional payroll taxes in respect of prior years 600 —
6,230 —
During the year unexpected geological conditions were encountered at both the Glenmuckloch and Muir Dean sites. As a result 
remaining coal reserves were much lower than previously expected, which increased the ratio of overburden to coal for each site. 
Work in progress balances have been adjusted accordingly. ATH Resources plc Annual report and accounts 2011 39 www.ath.co.uk
6 Exceptional operating items – continuing operations continued
Following a significant increase in certain operating costs, particularly gas oil, the Group has examined its unit cost rates applied to 
the estimated volume of overburden to be restored at the end of the productive life of each mine. As a result future cost rates have 
been amended, resulting in a requirement to increase in the Group’s restoration provisions. This review was undertaken in 
conjunction with an independent evaluation of the Group’s restoration liabilities.
A review of the Group’s payroll procedures and systems showed that there had been an under deduction of PAYE on some allowances 
paid to a small number of individuals over a number of years. The Group has made provision to cover the expected liability.
7 (Loss)/profit for the year – continuing operations
2011
£000
2010
£000
(Loss)/profit for the year has been arrived at after charging:
Depreciation of tangible assets:
– owned assets 11,099 10,243
– leased assets 2,878 3,321
Impairment of goodwill 1,650 —
Cost of inventories 71,434 62,520
Share-based payment (credit)/charge (note 22) (54) 72
Fair value (credit)/charge on financial derivatives (note 30) (71) 357
Staff costs (note 9) 15,734 14,109
Rentals under operating leases:
– plant and machinery 937 270
Auditor’s remuneration 
Associates of Baker Tilly UK Audit LLP:
– fees payable to the Company’s auditor for the audit of the Company’s annual accounts 25 27
– the audit of the Company’s subsidiaries pursuant to legislation 35 35
Total audit fees: 60 62
– tax services – Baker Tilly Tax and Accounting Ltd 13 32
– corporate finance services – Baker Tilly Corporate Finance LLP — 64
73 158
8 Finance costs – continuing operations
2011
£000
2010
£000
Bank overdraft and loan interest 1,010 1,031
Finance leases and hire purchase contracts interest 947 1,027
Final void provision discount 755 551
Unrealised (gains)/losses on derivative financial contracts (note 30) (71) 357
2,641 2,966
9 Staff costs – continuing operations
Staff costs during the year (including Directors)
2011
£000
2010
£000
Wages and salaries 13,733 12,415
Social security costs 1,686 1,415
Pension costs 315 279
15,734 14,109
Average number of employees
2011
Number
2010
Number
Office and management 74 67
Production 320 267
394 334
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 40 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
9 Staff costs – continuing operations continued
Directors’ emoluments
2011
£000
2010
£000
Directors’ emoluments 566 745
Pension contributions 60 63
626 808
Highest paid Director
2011
£000
2010
£000
Emoluments 200 229
Pension contributions 41 21
241 250
10 Tax expense – continuing operations
Tax recognised in the income statement:
2011
£000
2010
£000
UK Corporation Tax:
– on (loss)/profits for the year — 1,740
– adjustment in respect of prior periods 28 214
Total current tax recognised 28 1,954
Deferred taxation credit:
– accelerated capital allowances (310) (493)
– tax losses available (936) —
Total deferred tax recognised (1,246) (493)
Total tax (income)/expense recognised (1,218) 1,461
The total tax (credit)/charge assessed for the year differs from the average standard rate of UK tax as reconciled below:
2011
£000
2010
£000
(Loss)/profit on ordinary activities before taxation (5,846) 3,988
(Loss)/profit before taxation multiplied by average standard rate of tax for the period of 27% (2010: 28%) (1,578) 1,117
Expenses not deductible for tax purposes 546 106
Depreciation not allowable for tax purposes 27 28
Tax losses not utilised — 117
Effect of change in tax rates (241) (121)
Adjustment in respect of prior periods 28 214
Total tax expense (1,218) 1,461
Effective tax rate 20.8% 36.6%
11 Discontinued operations
On 29 July 2010, the Group disposed of the business assets of ATH Regeneration Limited, which specialised in the recovery of coal 
through the washing of redundant coal tips and its subsequent sale to UK electricity generators.
The disposal was to a newly formed company, RecyCoal Limited, which is funded by a European based private equity fund. 
Among the shareholders of RecyCoal Limited are Mr Tom Allchurch, the Group’s Chief Executive prior to the disposal and a Non -executive 
Director until 18 January 2011, and Mr Steven Beaumont, the Group’s Finance Director, until 30 September 2010. Details of related 
party transactions are set out in note 31.
The consideration received for the assets was £6,500,000, resulting in a loss on disposal of £1,136,000 together with an associated 
write off of goodwill of £2,244,000.
The Group entered into a licence agreement with RecyCoal Limited to exclusively license the intellectual property of the unique coal 
processing technology, ownership of which is retained within the Group. ATH Resources plc Annual report and accounts 2011 41 www.ath.co.uk
11 Discontinued operations continued
Analysis of the loss for the year from discontinued operations
2011
£000
2010
£000
Revenue — —
Other operating income — 11
Expenses — (1,573)
Loss on sale of business assets — (1,136)
Goodwill amortisation associated with disposal — (2,244)
Loss before tax — (4,942)
Attributable tax expense — 648
Loss for the year attributable to discontinued operations — (4,294)
2011
£000
2010
£000
Cash flows from discontinued operations
Net cash flows from operating activities — (5,455)
Net cash flows from investing activities — 3,015
Net cash flows from financing activities — (426)
Net cash flows — (2,866)
12 Earnings per share
Basic and diluted earnings per share
Basic (loss)/earnings per share is calculated by dividing the loss attributable to shareholders by the weighted average number 
of ordinary shares is issue during the period.
For diluted (loss)/earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion 
of all potential dilutive ordinary shares. The potential dilutive ordinary shares relate to those options granted to employees where 
the exercise price is less than the average market price of the Company’s ordinary shares at the balance sheet date.
The earnings and weighted average number of ordinary shares used in the calculation of basic and diluted earnings per share are 
as follows:
2011
£000
2010
£000
Loss for the year used in the calculation of basic and diluted earnings per share (4,628) (1,767)
Loss for the year from exceptional items 4,602 —
Loss for the year from discontinued operations — 4,294
(Loss)/earnings used in the calculation of basic and diluted earnings per share from continuing operations (26) 2,527
The weighted number of ordinary shares used in the calculation of basic and diluted earnings per share on continuing operations 
only are as follows:
2011
Number
000
2010
Number
000
Weighted number of ordinary shares for the purpose of basic earnings per share 40,075 40,075
Effect of dilutive potential ordinary shares from share options — 875
Weighted number of ordinary shares for the purpose of diluted earnings per share 40,075 40,950
There are 2,297,000 (2010: Nil) potential dilutive ordinary shares on continuing and discontinued operations, which have been 
disregarded in the above as they are anti-dilutive.
The (loss)/earnings per share on continuing operations only are as follows:
2011
pence
2010
pence 
From continuing operations (11.5)p 6.3p
From continuing operations before exceptionals (0.0)p 6.3p
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 42 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
13 Intangible assets
2011
£000
2010
£000
Cost
Balance at beginning and end of year 7,657 7,657
Accumulated impairment losses
Balance at beginning of year (2,244) —
Impairment recognised in the year (1,650) (2,244)
Balance at end of year 3,763 5,413
Goodwill is not amortised but is reviewed annually for impairment, or more frequently if internal or external factors indicate that 
goodwill might be impaired. Goodwill acquired in a business combination is allocated to the CGU which is expected to benefit 
from that acquisition. CGUs are the lowest level of trading operation at which goodwill is separately considered.
The carrying value is allocated to CGUs as follows:
2011
£000
2010
£000
Surface Mining business 1,413 1,413
Regeneration business 2,350 4,000
3,763 5,413
A goodwill asset is impaired if its carrying value exceeds the CGU’s recoverable amount which is based on its value in use. For the 
Surface Mining business at both 3 October 2010 and 2 October 2011, impairment reviews were performed by calculating the value 
in use of the CGU and comparing this with the value of the CGU. The value in use is calculated using cash flow forecasts from the most 
recent budget and business plan together with projections for the next seven years.
Following the receipt of advance royalties during the year, the impairment review was performed by calculating the present value 
of the expected income stream from the licensing of technology retained within the business and comparing this with the carrying 
value of goodwill. The value in use is calculated by using cash forecasts from the most recent budget and business plan for the next 
six years over which income will be received from the licensing of the technology. These cash forecasts have been adjusted to reflect 
the Group’s latest assessment of the likelihood of receipt.
The forecasts include the following key assumptions:
Surface 
Mining Regeneration
Growth rate 2.5% —
Discount rate 6.5% 5%
Direct costs growth – other direct costs 3% —
Direct costs growth – fuel costs 10% —
Sales prices growth 10% —
The estimated growth rates are based on past experience, knowledge of the market sectors and the current forecast of the 
opportunities open to the business in all of their markets.
Management estimates discount rates using pre-tax rates that reflect current assessments of the time value of money and the risks 
specific to each CGU.
Changes in direct costs are based on past experience and expectations of the future, particularly the impact of oil prices.
Sales price growth is based on current contractual agreements and expectation of new sales contracts based on the future changes 
given the market forward price curves and estimate of exchange rates, particularly sterling and the US dollar. New contracts will 
replace current contracts that are significantly below market prices.
Following the receipt of advance royalties, the present value of the expected licensing income indicated that the goodwill had been 
impaired by £1,650,000 (2010: £2,244,000). The goodwill impairment is shown separately within the income statement. There are 
no instances of goodwill impairment in the Surface Mining business from the goodwill impairment tasks performed in 2010 and 2011.
The Group has conducted a sensitivity analysis on the impairment test of the carrying value of each CGU. In the Surface Mining 
business, an increase in the discount rate to 19.5% from 6.5% used in the impairment reviews would result in the carrying value 
being reduced to its carrying amount. In the analysis of carrying value for the Regeneration goodwill, forecast cash flows would 
need to reduce by 1% to reduce the carrying value to its carrying amount. ATH Resources plc Annual report and accounts 2011 43 www.ath.co.uk
14 Property, plant and equipment
 
Freehold
land and 
buildings
£000
Mine
purchase and 
development
£000
Plant and
machinery
£000
Total
£000
Cost 
4 October 2009 10,875 63,364 62,578 136,817
Additions 482 5,930 876 7,288
Recognised in year — 2,322 — 2,322
Disposals — (4,509) (7,937) (12,446)
3 October 2010 11,357 67,107 55,517 133,981
Additions 340 8,653 1,592 10,585
Recognised in year — 4,122 — 4,122
Disposals — — (2,141) (2,141)
2 October 2011 11,697 79,882 54,968 146,547
Depreciation
4 October 2009 294 35,625 22,237 58,156
Charge in the year 55 8,474 5,229 13,758
Disposals — — (5,030) (5,030)
3 October 2010 349 44,099 22,436 66,884
Charge in the year 37 9,139 4,801 13,977
Disposals — — (1,528) (1,528)
2 October 2011 386 53,238 25,709 79,333
Net book value
2 October 2011 11,311 26,644 29,259 67,214
3 October 2010 11,008 23,008 33,081 67,097
Included within freehold land and buildings is an amount of £2,289,000 (2010: £2,289,000) in relation to an investment property. 
The investment property is included in the financial statements at cost which the Directors consider to be not materially different to 
its market value. Accordingly no depreciation has been charged.
The Group’s obligations under finance leases and hire purchase contracts (note 19) are secured by the lessor’s title to the leased 
assets which have a carrying value of £23,039,000 (2010: £26,263,000).
Mine purchase and development includes assets under construction with a carrying value of £710,000 (2010: £200,000).
The depreciation charge is allocated to the income statement as follows: cost of sales £13,907,000 (2010: £13,478,000); 
administrative expenses £70,000 (2010: £86,000); and discontinued operations £Nil (2010: £194,000).
15 Investments
Country of
registration
Type of 
shares
Proportion 
of voting
rights held
Proportion of
shareholding
Nature of
business
Name of company directly owned
Aardvark TMC Limited England Ordinary 100% 100% Surface coal mining
ATH Garleffan Limited England Ordinary 100% 100% Non-trading
ATH Regeneration Limited England Ordinary 100% 100% Land remediation
Northumbrian Power Limited  
(formerly ATH 2009 Limited) England Ordinary 100% 100% Surface mining project development
Held by subsidiary
A Ogden & Sons Limited England Ordinary 100% 100% Non-trading
Aardvark TFC Limited England Ordinary 100% 100% Intermediary holding company
Pacific West Coal Pty Ltd Australia Ordinary 100% 100% Non-trading
Société des Ressources Minières du
Massif Central (“SRMMC”) France Ordinary 100% 100% Surface mining project development
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 44 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
15 Investments continued
Aardvark TMC Limited has 20,000 “B” ordinary shares, subscribed at a nominal value of 1 pence each, in addition to the ordinary 
shares wholly owned by ATH Resources plc.
The “B” ordinary shares carry the rights only to receive a one off dividend in the event that its subsidiary, Aardvark TFC Limited, 
or its subsidiary SRMMC, are awarded damages in respect of the existing and future litigation against the French State. The “B” 
ordinary shares carry no voting rights or rights to receive any other dividend. As a result the “B” ordinary shares are not accounted 
for as a non-controlling interest.
16 Inventories
2011
£000
2010
£000
Coal inventories 3,545 4,754
Work in progress 6,316 5,952
Other inventories 1,602 1,219
11,463 11,925
Work in progress has been subject to write off during the year (note 6).
17 Trade and other receivables
2011
£000
2010
£000
Trade receivables 14,535 10,172
Prepayments and accrued income 428 310
Other receivables 25 775
14,988 11,257
The average credit period taken on sales of goods in 2011 is 61 days (2010: 47 days). No allowance for bad debts is held due to the 
insignificant levels of default arising in recent years and the credit insurance held.
Due to the nature of the Group’s activities, trade receivables consist of a relatively small number of individual balances. Credit insurance 
is maintained and the Directors monitor receivable balances to ensure any exposure is minimised. Before accepting any new customer 
the Directors review and consider the potential customer’s creditworthiness using experience of the relevant company, the industries 
into which it sells and the availability of insurance.
Ageing of overdue but not impaired receivables
2011
£000
2010
£000
1–30 days overdue 1,953 1,985
31–60 days overdue — —
60+ days overdue 26 —
1,979 1,985
18 Trade and other payables
2011
£000
2010
£000
Trade payables 6,820 6,412
Other taxation and social security 2,855 2,221
Other payables 308 314
Accruals and deferred income 5,172 2,280
15,155 11,227
19 Financial liabilities
Current
2011
£000
2010
£000
Obligations under finance leases and hire purchase contracts 5,331 6,175
Derivative financial instruments (note 30) 286 160
5,617 6,335 ATH Resources plc Annual report and accounts 2011 45 www.ath.co.uk
19 Financial liabilities continued
Non‑current
2011
£000
2010
£000
Drawings under revolving credit facility 19,000 20,000
Obligations under finance leases and hire purchase contracts 7,710 10,676
Derivative financial instruments (note 30) — 197
26,710 30,873
Unamortised cost of borrowings (535) (564)
26,175 30,309
The effective interest rates at the balance sheet date were as follows:
2011
%
2010
%
Drawings under revolving credit facility 4.5 3.6
Obligations under finance leases and hire purchase contracts 5.0 5.4
Total financial liabilities are repayable as follows:
2011
Revolving
credit
facility
£000
Derivative
financial
instruments
£000
Finance
leases and
HP contracts
£000
Total
£000
On demand or within one year — 286 5,331 5,617
More than one year but not more than two years 19,000 — 4,593 23,593
More than two years but not more than five years — — 3,117 3,117
19,000 286 13,041 32,327
2010
Revolving
credit
facility
£000
Derivative
financial
instruments
£000
Finance
leases and
HP contracts
£000
Total
£000
On demand or within one year — 160 6,175 6,335
More than one year but not more than two years 1,500 197 5,070 6,767
More than two years but not more than five years 18,500 — 5,606 24,106
20,000 357 16,851 37,208
The revolving credit facility is secured by a fixed and floating charge over certain assets of the Group. Obligations under finance 
leases and hire purchase contracts are secured on the related assets.
Undrawn borrowing facilities at the balance sheet date amounted to £4,500,000 (2010: £3,500,000).
Minimum obligations under finance leases:
2011
£000
2010
£000
Within one year 5,945 6,924
In the second to fifth years 8,050 11,313
13,995 18,237
Less future finance charges (954) (1,386)
Present value of lease obligations 13,041 16,851
All obligations under finance leases and hire purchase contracts relate to the acquisition of plant and machinery.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 46 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
20 Provisions
Deferred
consideration
£000
Final void 
provision 
£000
Deferred
tax
£000
Total
£000
4 October 2009 338 18,460 4,334 23,132
Created in the year — 2,322 — 2,322
Discount accrued — 551 — 551
Released on disposal of discontinued operations (338) — — (338)
Charged/(credited) to income statement — 55 (1,080) (1,025)
Utilised in the year — (2,575) — (2,575)
3 October 2010 — 18,813 3,254 22,067
Created in the year — 4,122 — 4,122
Discount accrued — 755 — 755
Charged/(credited) to income statement (including £1,563,000 exceptional costs) — 3,761 (1,246) 2,515
Utilised in the year — (697) — (697)
2 October 2011 — 26,754 2,008 28,762
A total of £3,048,000 (2010: £2,315,000) of the final void provision is classified as a current liability to reflect the time profile 
of anticipated works.
In determining the final void provision, the Group assesses the likely timing of the expenditure and inflates current estimate of cost 
by 2.5 per cent per annum. These estimated future cash flows are discounted at a rate of 6.5 per cent to determine an estimated net 
present value of final void expenditure.
The deferred consideration related to the acquisition in 2008 of Pacific West Coal Pty Ltd where under the terms of the acquisition 
agreement, a contingent consideration was payable depending on the Group’s level of success in obtaining future contracts. This 
business is no longer operational following the sale of the ATH Regeneration assets and no additional consideration will be payable.
Deferred tax comprises:
2011
£000
2010
£000
Capital allowances in excess of depreciation 2,950 3,260
Tax losses available (936) —
Temporary differences (6) (6)
2,008 3,254
Deferred tax assets of £942,000 (2010: £6,000) have been recognised to the extent that they are expected to be recovered, 
based on forecasts of future taxable profits and taking into account this year’s exceptional items. Further deferred tax assets of 
£38,000 (2010: £39,000) have not been recognised due to uncertainty regarding their recoverability.
21 Called up share capital
2011 2010
Ordinary shares of 0.5 pence each Number £000 Number £000
Authorised 200,000,000 1,000 200,000,000 1,000
Called up and fully paid 40,075,158 200 40,075,158 200
During the year, the Company issued no new share capital. ATH Resources plc Annual report and accounts 2011 47 www.ath.co.uk
22 Share-based payments
Share options have been granted and are still outstanding under the ATH Resources plc Approved Executive Share Option Scheme, 
the ATH Resources plc Unapproved Executive Share Option Scheme and the ATH Resources plc Long Term Incentive Plan as follows:
ATH Resources plc Approved Executive Share Option Scheme
The following options had been granted and were still outstanding under the scheme:
At 2 October 2011
Date of grant
Exercise
price
£
Options
outstanding
3 October
2010
Granted
during
the year
Forfeited
during
the year
Exercised
during
the year
Options
outstanding
2 October
2011
Performance
target
(pence)
Performance period
from to
1 November 2004 1.46 61,413 — — — 61,413 1 Oct 03 30 Sep 06 38.68
61,413 — — — 61,413 
At 3 October 2010
Date of grant
Exercise
price
£
Options
outstanding
4 October
2009
Granted
during
the year
Forfeited
during
the year
Exercised
during
the year
Options
outstanding
3 October
2010
Performance
target
(pence)
Performance period
from to
1 November 2004 1.46 102,355 — (40,942) — 61,413 1 Oct 03 30 Sep 06 38.68
7 January 2007 1.95 30,768 — (30,768) — — 1 Oct 06 30 Sep 09 55.40
133,123 — (71,710) — 61,413 
The options are exercisable between three and ten years from the date of grant subject to the achievement of performance criteria. 
The performance target is cumulative pre-tax earnings per share.
ATH Resources plc Unapproved Executive Share Option Scheme
The following options had been granted and were still outstanding under the scheme:
At 2 October 2011
Date of grant
Exercise
price
£
Options
outstanding
3 October
2010
Granted
during
the year
Forfeited
during
the year
Exercised
during
the year
Options
outstanding
2 October
2011
Performance
target
(pence)
Performance period
from to
11 June 2004 1.33 407,701 — — — 407,701 1 Oct 03 30 Sep 06 38.68
29 September 2005 1.85 218,372 — — — 218,372 1 Oct 04 30 Sep 07 44.20
3 October 2006 2.065 76,950 — — — 76,950 1 Oct 05 30 Sep 08 44.50
15 January 2008 2.05 66,341 — — — 66,341 — — None
20 January 2010 0.8125 139,870 — — — 139,870 1 Oct 09 30 Sep 12 (1)
909,234 — — — 909,234 
At 3 October 2010
Date of grant
Exercise
price
£
Options
outstanding
4 October
2009
Granted
during
the year
Forfeited
during
the year
Exercised
during
the year
Options
outstanding
3 October
2010
Performance
target
(pence)
Performance period
from to
11 June 2004 1.33 972,002 — (564,301) — 407,701 1 Oct 03 30 Sep 06 38.68
29 September 2005 1.85 382,132 — (163,760) — 218,372 1 Oct 04 30 Sep 07 44.20
3 October 2006 2.065 76,950 — — — 76,950 1 Oct 05 30 Sep 08 44.50
8 January 2007 1.95 141,732 — (141,732) — — 1 Oct 06 30 Sep 09 55.40
15 January 2008 2.05 301,951 — (235,610) — 66,341 — — None
20 January 2010 0.8125 — 636,616 (496,746) — 139,870 1 Oct 09 30 Sep 12 (1)
1,874,767 636,616 (1,602,149) — 909,234 
The options are exercisable between three and ten years from the date of grant subject to the achievement of performance criteria. 
The performance target is cumulative pre-tax earnings per share.
(1)  The options issued in 2010 are exercisable between three and five years from the date of grant subject to the achievement of the 
performance criteria. The performance target is 4% annual growth in pre-tax earnings per share.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 48 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
22 Share-based payments continued
ATH Resources plc Long Term Incentive Plan
The following options had been granted and were still outstanding under the scheme:
At 2 October 2011
Date of grant
Exercise
price
£
Options
outstanding
3 October
2010
Granted
during
the year
Forfeited
during
the year
Exercised
during
the year
Options
outstanding
2 October
2011
Performance
target
(pence)
Performance period
from to
29 September 2005 1.70 218,372 — — — 218,372 1 Oct 04 30 Sep 08 59.80
3 October 2006 1.80 76,950 — — — 76,950 1 Oct 05 30 Sep 09 60.80
15 January 2008 0.01 325,358 — (325,358) — — 1 Oct 07 30 Sep 10 (2)
8 October 2009 0.01 361,531 — (49,902) — 311,629 1 Oct 09 30 Sep 12 (2)
20 January 2010 0.01 525,019 — (51,254) — 473,765 1 Oct 09 30 Sep 12 (2)
20 January 2011 0.01 — 1,666,571 (114,185) — 1,552,386 20 Jan 11 20 Jan 14 (3)
1,507,230 1,666,571 (540,699) — 2,633,102 
At 3 October 2010
Date of grant
Exercise
price
£
Options
outstanding
4 October
2009
Granted
during
the year
Forfeited
during
the year
Exercised
during
the year
Options
outstanding
3 October
2010
Performance
target
(pence)
Performance period
from to
29 September 2005 1.70 382,132 — (163,760) — 218,372 1 Oct 04 30 Sep 08 59.80
3 October 2006 1.80 76,950 — — — 76,950 1 Oct 05 30 Sep 09 60.80
8 January 2007 1.75 172,500 — (172,500) — — 1 Oct 06 30 Sep 10 75.70
15 January 2008 0.01 649,856 — (324,498) — 325,358 1 Oct 07 30 Sep 10 (2)
8 October 2009 0.01 — 552,999 (191,468) — 361,531 1 Oct 09 30 Sep 12 (2)
20 January 2010 0.01 — 1,084,012 (558,993) — 525,019 1 Oct 09 30 Sep 12 (2)
1,281,438 1,637,011 (1,411,219) — 1,507,230 
(2)  The options issued in 2005, 2006 and 2007 are exercisable between five and ten years from the date of grant subject to the 
achievement of performance criteria. The performance criteria are cumulative pre-tax earnings per share. The options issued 
in 2008, 2009 and 2010 are exercisable between three and ten years from the date of grant subject to the achievement of the 
performance criteria. The performance target is average annual growth in pre -tax earnings per share. If the average pre-tax 
earnings per share increases by over 10% per annum over the performance period, the full award will vest. If the average pre-tax 
earnings per share increases by between 7.5% and 10%, 75% of the award will vest. If the average pre-tax earnings per share 
increases by between 5% and 7.5%, 50% of the award will vest. If the average pre-tax earnings per share increases by less than 
5% per annum, the options will lapse.
(3)  The options issues in 2011 are exercisable between three and five years from the date of grant subject to the achievement of 
performance criteria. The performance criteria is 15% per annum compound total shareholder return over the performance period. 
The options were valued using the Stochastic model. For the purposes of the valuation volatility was estimated at 54.1% based 
on movements in the Company share price in the three years prior to the date of the grant. The share price on 20 January 2011 
was 69.25 pence. Expected excise of the options is after three years; the risk free rate was 1.38% with an expected dividend 
yield of 4.3%. The fair value of each option is 31.29 pence.
Total options exercisable over the shares of the Company at the year end were 1,049,149 (2010: 982,808). ATH Resources plc Annual report and accounts 2011 49 www.ath.co.uk
22 Share-based payments continued
ATH Resources plc Long Term Incentive Plan
The Group recognised a total (credit)/charge in relation to share-based payments as follows:
2011
£000
2010
£000
Equity-settled share-based payments (54) 72
23 Reserves
Share
premium
£000
Retained
earnings
£000
4 October 2009 27,855 4,205
Addition in respect of share-based payments — 72
Loss for the year — (1,767)
Dividends paid — (2,865)
3 October 2010 27,855 (355)
Reduction in respect of share-based payments — (54)
Loss for the year — (4,628)
Dividends paid — (801)
3 October 2011 27,855 (5,838)
24 Equity dividends
Declared and paid during the financial year
2011
£000
2010
£000
Final dividend for the year ended 3 October 2010: 2.00 pence per share (2009: 6.15 pence per share) 801 2,464
Interim dividend for the year ended 2 October 2011: Nil pence per share (2010: 1.00 pence per share) — 401
801 2,865
Proposed after the balance sheet date and not recognised as a liability 
Final dividend for the year ended 2 October 2011: Nil pence per share (2010: 2.00 pence per share) — 801
25 Operating lease commitments
At 2 October 2011 the Group was committed to making the following minimum lease payments in respect of operating leases:
2011 2010
Land and
buildings
£000
Other
£000
Land and
buildings
£000
Other
£000
Plant and machinery
Not later than one year — 1,070 — 532
Later than one year but not later than five years — 1,447 — 749
— 2,517 — 1,281
26 Commitments and guarantees
At 2 October 2011 the Group was committed to acquiring plant and machinery:
2011
£000
2010
£000
Contracted but not provided 437 346
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 50 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
27 Contingent liabilities
Restoration bonds and guarantees
2011
£000
2010
£000
Indemnities for restoration bonds 26,966 26,715
Restoration bonds are provided by specialist insurance companies to the relevant local authority in respect of the Group’s restoration 
obligations in the normal course of business. The Group provides full indemnities in respect of these restoration bonds.
The final void provision (note 20) includes the Board’s best estimate of the costs required to meet the Group’s restoration obligations 
across all sites. Therefore no liability has been recognised in respect of the above indemnities.
In addition the Group has provided a guarantee of £3,000,000 directly to a local authority to supplement the restoration bond in place.
Carbon Reduction Commitment (“CRC”) Scheme
The Board is of the view that the electricity consumption of its 12 kilometre conveyor should be exempt from the CRC Scheme. 
However, the Government is challenging the Group’s decision not to opt into the CRC Scheme and the results of a hearing to clarify 
the situation are expected towards the end of the current calendar year. The potential impact to the Group if it fails to win exemption 
from the CRC Scheme would be an increase in its costs by a further £1,400,000 per annum for each of the three years from April 2011. 
No liability in respect of the CRC Scheme has been recognised at the year end.
28 Reconciliation of profit before tax to net cash generated from operations
2011
£000
2010
£000
(Loss)/profit before tax on continuing operations (5,846) 3,988
Loss before tax on discontinued operations — (4,942)
Adjustments for:
Finance costs 2,641 2,966
Depreciation of property, plant and equipment 13,977 13,758
Loss on disposal of fixed assets 52 3,380
Impairment of goodwill 1,650 —
Share-based payment (credit)/expense (54) 72
Operating cash flows before movements in working capital 12,420 19,222
Decrease in inventories 462 203
Increase in receivables (3,731) (1,636)
Increase/(decrease) in payables and provisions 7,021 (5,053)
Cash generated from operations 16,172 12,736
For the purpose of the cash flow statement, cash and cash equivalents comprise the following:
2011
£000
2010
£000
Cash and cash equivalents 498 2,353
29 Analysis of net debt
3 October
2010
£000
Net cash
flow
£000
2 October
2011
£000
Cash at bank and in hand 2,353 (1,855) 498
Debt due after one year (30,676) 3,966 (26,710)
Debt due within one year (6,175) 844 (5,331)
Total debt (36,851) 4,810 (32,041)
Net debt (34,498) 2,955 (31,543) ATH Resources plc Annual report and accounts 2011 51 www.ath.co.uk
30 Financial instruments
General risk management principles
The Board has overall responsibility for the establishment and oversight of the Group’s risk management framework. A formal risk 
assessment and management framework for assessing, monitoring and managing the strategic, operational and financial risks of 
the Group is in place to ensure appropriate risk management of its operations. Internal control and risk management systems are 
embedded in the operations of the divisions.
Capital risk management
The Group manages its capital to ensure that the Group will be able to continue as a going concern whilst taking advantage of 
the opportunities in its chosen markets, providing returns for its shareholders and to maintain an optimal level of both debt and 
equity finance.
The Group’s capital structure consists of debt, including the borrowings as set out in note 19; bank overdraft and cash and cash 
equivalents; and equity attributable to equity holders of the parent, comprising issued share capital, reserves and retained earnings 
as disclosed in notes 21 and 23.
The Group has satisfied all reportable banking covenants during the current and previous years.
The Group uses its gearing ratio to monitor its capital structure, gearing being calculated as net debt divided by total capital. 
Net debt is bank loans, bank overdrafts, drawings under the revolving credit facility and finance lease liabilities less cash and cash 
equivalents. Total capital is net debt and the equity attributable to equity holders of the parent.
The gearing ratio at the year end is as follows:
2011
£000
2010
£000
Drawings under the revolving credit facility and finance lease liabilities 32,041 36,851
Cash and cash equivalents (498) (2,353)
Net debt 31,543 34,498
Total equity 22,217 27,700
Total capital 53,760 62,198
Gearing ratio 59% 55%
The reported gearing for the year has increased due to the loss for the year exceeding the reduction in the level of net debt.
Significant accounting policies
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement 
and the basis on which income and expenses are recognised in respect of each class of financial asset, financial liability and equity 
instrument, are disclosed in the Group Accounting Policies on pages 31 to 36.
Categories of financial instruments
2011
£000
2010
£000
Financial assets
Cash and cash equivalents 498 2,353
Trade and other receivables 14,988 11,257
Financial liabilities
Trade and other payables (15,155) (11,227)
Drawings under revolving credit facility (19,000) (20,000)
Derivative financial instruments (286) (357)
Obligations under finance leases and hire purchase contracts (13,041) (16,851)
The carrying amount of financial assets and financial liabilities are recorded at amortised cost in the financial statements and are 
considered to approximate to their fair value, with the exclusion of derivative financial instruments which are carried at fair value. 
The drawings under the revolving credit facility are shown gross of unamortised borrowing costs of £535,000 (2010: £564,000).
Cash and cash equivalents are cash balances held by the Group. All financial assets are classified as loans and receivables and 
all financial liabilities are classified as other liabilities.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 52 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
30 Financial instruments continued
The Company is part of a Group banking arrangement. On 29 September 2011, the Group extended its revolving credit facility 
to 31 May 2013.
Financial risk management objectives
The Group has exposure to a variety of financial risks through the conduct of its operations. The overall risk management policies 
of the Group are designed to minimise implicit credit risk, market risk, foreign currency risk and liquidity risk. Risk management 
is governed by the Group’s operational policies which are managed and reviewed by the Board of Directors.
Market risk
The Group’s activities expose it primarily to the financial risks of changes in credit risks, foreign currency risk, liquidity risk and 
interest rate movements described below.
Market risk exposures are monitored and are supplemented by sensitivity analysis. There has been no change to the Group’s exposure 
to market risks or the manner in which it manages and measures the risk.
The Group enters into hedging agreements to fix the forward price of gas oil, a significant operating cost. These instruments are 
entered into to provide certainty and minimise the price of oil on the Group. The fair values are based on movements in the value 
of the underlying commodity.
Derivatives used for hedging
The notional principal amounts and remaining terms of gas oil derivatives at the end of the reporting period are set out below:
Outstanding gas oil derivatives
Contracted
price
per litre
2011
pence
Notional
principal 
value
2011
£000
Fair value
2011
£000
Less than one year 48.24 2,026 (69)
The derivatives are categorised as level 2 within the fair value hierarchy. An amount of £69,000 was debited to the income statement 
during the year in respect of these outstanding derivatives.
Foreign currency risk management
The Group undertakes certain transactions denominated in foreign currencies when purchasing significant capital equipment 
from abroad and exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy 
parameters utilising forward foreign exchange contracts if considered appropriate.
The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities were insignificant 
at each balance sheet date.
Credit risk
Credit risk predominantly arises from trade receivables and cash and cash equivalents and refers to the risk that a counterparty 
will default on its contractual obligations resulting in financial loss to the Group. The Group has a policy of only dealing with 
creditworthy counterparties and obtaining sufficient insurance where appropriate as a means of mitigating the risk of financial 
loss from defaults.
The Group generally transacts with large entities that are in the power generating, coal wholesale and manufacturing industries 
and has had little history of default in recent years. Credit exposures are reviewed by the Board regularly.
The Group does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar 
characteristics. The Group defines counterparties as having similar characteristics if they are connected entities.
Cash and cash equivalents are held with banks.
The Group’s maximum exposure to credit risk relating to its financial assets is equivalent to their carrying value as disclosed below:
2011
£000
2010
£000
Trade receivables 14,028 10,172
Cash and cash equivalents 498 2,353
14,526 12,525
The ageing analysis of trade receivables is shown in note 17. ATH Resources plc Annual report and accounts 2011 53 www.ath.co.uk
30 Financial instruments continued
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has built an appropriate liquidity 
risk management framework for the management of the Group’s short, medium and long term funding and liquidity 
management requirements.
The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowings facilities by continually 
monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. Included in note 19 
is an analysis of the maturity of the Group’s borrowings along with a description of additional undrawn facilities that the Group has 
at its disposal to further reduce liquidity risk.
The average credit period taken for trade purchases is 40 days (2010: 37 days), which reflects the mix of when these amounts 
are contractually due.
Interest rate risk management
The Group is exposed to interest rate risk as entities in the Group borrow funds at both fixed and floating interest rates. The risk 
is managed by the Group by maintaining an appropriate mix between fixed and floating rate borrowings and by the use of interest 
rate swap contracts when necessary. Hedging activities are evaluated regularly with a policy of aligning interest rate views and 
defined risk profiles to ensure optimal hedging strategies are applied, as considered appropriate.
The Group’s primary interest rate profile on financial liabilities is as follows:
2011 2010
Fixed
rate
£000
Floating
rate
£000
Total
£000
Fixed
rate
£000
Floating
rate
£000
Total
£000
Drawing under revolving credit facility — 19,000 19,000 — 20,000 20,000
Finance leases and hire purchase contracts 12,853 188 13,041 16,101 750 16,851
12,853 19,188 32,041 16,101 20,750 36,851
Interest rate swap contracts
The Group has entered into interest rate swap contracts to mitigate the risk of changes to the variable rate of interest payable 
on certain borrowings.
The contracts enable the Group to exchange variable rates of interest for fixed rates. The fair value of the interest rate swaps 
is determined by discounting the future cash flows using the curves at the end of the reporting period and the credit risk interest 
in the contract and is disclosed below. The average interest rate is based on the outstanding balances at the period end.
Derivatives used for hedging
The notional principal amounts and remaining terms of interest rate swap contracts at the end of the reporting period are set out below:
Average contracted
fixed interest rate
Notional
principal value Fair value
Outstanding receive floating pay fixed contracts
2011
%
2010
%
2011
£000
2010
£000
2011
£000
2010
£000
Less than one year 3.9 2.4 7,500 10,000 (217) (160)
One to two years — 3.9 — 7,500 — (197)
7,500 17,500 (217) (357)
The interest rate swaps are settled on a quarterly basis. The floating rate is the LIBOR based rate implicit on the Group revolving 
credit facility. The Group will settle the difference between the fixed and floating rates on a net basis. The derivatives are categorised 
as level 2 within the fair value hierarchy. An amount of £140,000 was credited to the income statement during the year in respect of 
these derivatives.
Interest rate sensitivity analysis
The sensitivity analysis below has been determined based on the exposure to interest rates in respect of the Group’s borrowings. 
For floating rate liabilities, the analysis is prepared assuming the amount of liability outstanding at the balance sheet date was outstanding 
for the whole year. A 2% increase (2010: 2%) or 1% decrease (2010: 1%) represents management’s assessment of the reasonably 
possible change in interest rates, which is attributable to the Group’s exposure to interest rates on its variable rate borrowings.
Impact on post‑tax profit for the year
2011
£000
2010
£000
Increase in floating rate of 2% (2010: 2%) (280) (299)
Decrease in floating rate of 1% (2010: 1%) 140 149
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 54 www.ath.co.uk
Notes to the Group financial statements
for the year ended 2 October 2011 continued
31 Related party transactions
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and have 
not therefore been disclosed.
Licensing of technology
In the prior year the Group entered into a licensing agreement with RecyCoal Limited for the exclusive worldwide use of Group’s 
coal washing technology and intellectual property, ownership of which has been retained within the Group. The licence, which 
began in 2010, is for a period of seven years and, under the agreement, the Group will receive royalties based on the performance of 
RecyCoal Limited. The royalties that can be earned are subject to a cap of £8,000,000. RecyCoal Limited has the option to purchase 
the intellectual property rights at the end of the licensing period. Mr Tom Allchurch, Non-executive Director until 18 January 2011, 
is part owner and director of RecyCoal Limited.
Leasing of property
The Group has leased its property at Pinxton, where the former ATH Regeneration coal tip washing plant is situated, to RecyCoal Limited. 
The initial lease runs until January 2014 and is at a nominal rental.
Management services
Following the disposal, the Group entered into an agreement for the short term provision of management and support services from 
the Group to RecyCoal Limited and to receive such from RecyCoal Limited. The Group entered into the following transactions:
Provision of services Receipt of services 
2011
£000
2010
£000
2011
£000
2010
£000
RecyCoal Limited 30 36 28 8
The following balances were outstanding at the end of the reporting period:
Amounts owed by
related parties
Amounts owed to
related parties
2011
£000
2010
£000
2011
£000
2010
£000
RecyCoal Limited — 18 — 6
The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. No expense has 
been recognised in the current period for bad or doubtful debts in respect of the amounts owed by related parties.
Compensation of key management personnel
The remuneration of the Directors, who are considered to be the key management personnel of the Group, is set out below in 
aggregate for each of the categories specified in IAS 24 ‘Related Party Disclosures’. Further information about the remuneration 
of individual Directors is provided in the Remuneration Committee Report on pages 23 and 24.
2011
£000
2010
£000
Salaries and short term employee benefits 662 859
Pension contributions 42 76
Share-based payments (18) (12)
686 923 ATH Resources plc Annual report and accounts 2011 55 www.ath.co.uk
Independent auditor’s report
to the members of ATH Resources plc
We have audited the parent company financial statements of ATH Resources plc which comprise the parent company Balance Sheet 
and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United 
Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 
2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to 
state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume 
responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, 
or for the opinions we have formed.
Respective responsibilities of Directors and auditor
As more fully explained in the Directors’ Responsibilities Statement set out on page 18 the Directors are responsible for the preparation 
of the parent company financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and 
express an opinion on the parent company financial statements in accordance with applicable law and International Standards on 
Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.
Scope of the audit
A description of the scope of an audit of financial statements is provided on the APB’s website at www.frc.org.uk/apb/scope/private.CFN.
Opinion on the financial statements
In our opinion the parent company financial statements:
h h give a true and fair view of the state of the Company’s affairs as at 2 October 2011;
h h have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
h h have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Directors’ Report for the financial year for which the financial statements are prepared 
is consistent with the parent company financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, 
in our opinion:
h h adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches 
not visited by us; or
h h the parent company financial statements are not in agreement with the accounting records and returns; or
h h certain disclosures of Directors’ remuneration specified by law are not made; or
h h we have not received all the information and explanations we require for our audit.
Andrew Allchin (Senior Statutory Auditor)
For and on behalf of Baker Tilly UK Audit LLP
Statutory Auditor
Chartered Accountants
2 Whitehall Quay
Leeds LS1 4HG
25 January 2012
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 56 www.ath.co.uk
Company balance sheet
as at 2 October 2011
Company number 4928463
2011 2010
Notes £000 £000 £000 £000
Fixed assets
Investments 3 5,907 5,907
Current assets
Debtors: due after more than one year 4 29,790 33,263
Cash in hand 52 — 
29,842 33,263 
Creditors: amounts falling due within one year 5 (24) (128) 
Net current assets 29,818 33,135
Total assets less current liabilities 35,725 39,042
Creditors: amounts falling due after more than one year 6 (6,978) (9,949)
Net assets 28,747 29,093
Capital and reserves
Called up share capital 7 200 200
Share premium account 8 27,855 27,855
Profit and loss account 8 692 1,038
Equity shareholders’ funds 9 28,747 29,093
The financial statements on pages 56 to 59 were approved by the Board of Directors and authorised for issue on 25 January 2012 
and are signed on its behalf by:
A P Weatherstone
Group Finance Director ATH Resources plc Annual report and accounts 2011 57 www.ath.co.uk
Company accounting policies
for the year ended 2 October 2011
Basis of accounting
The separate financial statements of the Company are presented as required by the Companies Act 2006. They have been prepared 
under the historical cost convention and in accordance with applicable UK GAAP and law.
Basis of preparation
The Company is a holding company and meets its day to day working capital requirements through an overdraft facility which 
is repayable on demand and through the support of its trading subsidiaries.
Accounting period
The Company has drawn up its accounts for the 52 week period to 2 October 2011 (2010: 52 week period to 3 October 2010).
Profit and loss account
The Company has not presented its own profit and loss account, as permitted by Section 408 of the Companies Act 2006.
Cash flow
The Company is exempt from the requirements of Financial Reporting Standard 1 ‘Cash Flow Statements (revised)’.
Investments
Investments are stated at cost and provision is made for any impairment in the value of fixed asset investments.
Deferred taxation
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where 
transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred 
at the balance sheet date. Timing differences are differences between the Group’s taxable profits and its results as stated in the 
financial statements that arise from the inclusion of gains and losses in tax assessments in periods different from those in which 
they are recognised in the financial statements.
Deferred tax is measured at the average tax rates that are expected to apply in the periods in which timing differences are expected 
to reverse, based on tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax is 
measured on a non-discounted basis.
Share-based payments
Share-based payments are accounted for as described in the Group Accounting Policies on page 33.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 58 www.ath.co.uk
Notes to the Company financial statements
for the year ended 2 October 2011
1 Operating profit
The auditor’s remuneration for audit services to the Company expensed was £10,000 (2010: £10,000).
The Company has no employees other than the Directors whose remuneration was borne by subsidiary undertakings and is disclosed 
on page 40.
2 Profit of the Company
The Company has taken advantage of Section 408 of the Companies Act 2006 and consequently its profit and loss account is not 
presented as part of these accounts. The profit of the Company for the financial year amounted to £509,000 (2010: loss of £2,069,000). 
Dividends paid and proposed are disclosed in note 24 to the consolidated financial statements.
3 Investments
Investments in subsidiary undertakings
2011
£000
2010
£000
Cost
At beginning and end of year 8,907 8,907
Provisions for impairment
At beginning of year (3,000) —
Written off — (3,000)
At end of year (3,000) (3,000)
Net book value 5,907 5,907
Details of the Company’s investments are disclosed in note 15 to the consolidated financial statements.
4 Debtors: due after more than one year
2011
£000
2010
£000
Amounts due from subsidiary undertakings 29,790 33,263
5 Creditors: amounts falling due within one year
2011
£000
2010
£000
Bank overdraft — 58
Corporation Tax — 41
Accruals and deferred income 24 29
24 128
6 Creditors: amounts falling due after more than one year
2011
£000
2010
£000
Drawings under revolving credit facility 7,500 10,500
Amounts due to subsidiary undertaking 13 13
7,513 10,513
Unamortised borrowing costs (535) (564)
6,978 9,949
The revolving credit facility is secured by a fixed charge over certain assets of the Group. The Company is party to a cross guarantee 
with its subsidiary undertakings in respect of bank loans and overdrafts held by Group companies which are secured by debentures 
over the assets of the Group. ATH Resources plc Annual report and accounts 2011 59 www.ath.co.uk
7 Called up share capital
2011 2010
Ordinary shares of 0.5 pence each Number £000 Number £000
Authorised 200,000,000 1,000 200,000,000 1,000
Called up and fully paid 40,075,158 200 40,075,158 200
During the year, the Company issued no new shares.
Share options have been granted and are still outstanding under the ATH Resources plc Approved Executive Share Option Scheme, 
the ATH Resources plc Unapproved Executive Share Option Scheme and the ATH Resources plc Long Term Incentive Plan as set out 
in note 22 to the consolidated financial statements.
8 Other reserves
Share
premium
£000
Profit
and loss
account
£000
3 October 2010 27,855 1,038
Reduction in respect of share-based payment — (54)
Profit on ordinary activities after taxation — 509
Dividends paid — (801)
2 October 2011 27,855 692
9 Reconciliation of movement in shareholders’ funds
2011
£000
2010
£000
(Reduction)/addition in respect of share-based payments (54) 72
Profit/(loss) for the year 509 (2,069)
Dividends paid (801) (2,865)
Net decrease in shareholders’ funds (346) (4,862)
Opening shareholders’ funds 29,093 33,955
Closing shareholders’ funds 28,747 29,093
10 Financial instruments
The Company recognises and manages financial instruments as set out in note 30 to the consolidated financial statements.
11 Contingent liabilities
As included in note 27 to the consolidated financial statements, the Company has provided a guarantee of £3,000,000 directly 
to a local authority.
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 60 www.ath.co.uk
Notice of annual general meeting – ATH Resources plc
NOTICE IS HEREBY GIVEN that the Annual General Meeting of the Company will be held at the offices of Eversheds LLP Solicitors, 
Bridgewater Place, Water Lane, Leeds LS11 5DR on Wednesday 29 February 2012 at 11.00am to transact the following business:
Ordinary business
1. To receive the accounts of the Company for the year ended 2 October 2011 and the reports of the Directors and the auditors.
2. To re-elect John Timothy Stokeld as a Director.
3.  To re-appoint Baker Tilly UK Audit LLP as auditor to the Company, to hold office until the conclusion of the next general meeting 
at which accounts are laid before the Company and to authorise the Directors to fix their remuneration.
4. To receive and approve the Remuneration Committee Report.
Special business
To consider and, if thought fit, (and in the case of resolution 6 to the passing of resolution 5) pass the following resolutions. 
Resolution 5 will be proposed as an ordinary resolution. Resolutions 6 and 7 will be proposed as special resolutions. 
5. (i)  THAT the Directors be and are hereby generally and unconditionally authorised in accordance with section 551 of the 
Companies Act 2006 (the “Act”) (in substitution for any existing authorities to allot relevant securities) to exercise all the 
powers of the Company to allot relevant securities (within the meaning of section 551 of the Act) up to a maximum 
nominal amount of £60,112 (being approximately 30% of the issued share capital of the Company) provided that such 
authority shall expire at the conclusion of the next Annual General Meeting (or, if earlier on 31 March 2013) and provided 
further that the Company may before such expiry make such offers or agreements which would or might require relevant 
securities to be allotted after such expiry;
 and further that 
5. (ii)  THAT the Directors be and they are hereby generally and unconditionally authorised to exercise all powers of the Company 
to allot equity securities (within the meaning of section 560 of the Act) in connection with a rights issue in favour of 
ordinary shareholders where the equity securities respectively attributable to the interests of all ordinary shareholders are 
proportionate (as nearly as may be) to the respective numbers of ordinary shares held by them up to an aggregate nominal 
amount of £60,112 (being approximately 30% of the issued share capital of the Company) provided that this authority shall 
expire on the conclusion of the next Annual General Meeting of the Company after the passing of this resolution save that 
the Company may before such expiry make an offer or agreement which would or might require equity securities to be 
allotted after such expiry and the Directors may allot equity securities in pursuance of such an offer or agreement as if 
the authority conferred hereby had not expired.
6.  THAT, subject to the passing of resolution 5, the Directors be and are hereby empowered pursuant to section 570 of the Act 
to allot equity securities (as defined in section 560 of the Act) for cash as if section 561(1) did not apply to such allotment, 
provided that this power shall be limited to:
 (i)  the allotment of equity securities in connection with a rights issue or other issue in favour of the holders of ordinary shares 
(notwithstanding that, by reason of such exclusions or other arrangements as the Directors may deem necessary or expedient 
to deal with fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised 
regulatory body or any stock exchange in, any territory, the equity securities to be issued are not offered to all such holders 
in proportion to the number of ordinary shares held by each of them); and
 (ii)  the allotment (otherwise than pursuant to sub-paragraph (i) above) of equity securities up to an aggregate nominal value 
of £20,037 being approximately 10% of the Company’s issued share capital;
  and such power shall expire on the conclusion of the next Annual General Meeting of the Company after the passing of this 
resolution (or if earlier 31 March 2013), save that the Company may before such expiry make any offers or agreements which 
would or might require equity securities to be allotted after such expiry.
7.  THAT, the Company be generally and unconditionally authorised, pursuant to Article 9 of the Articles of Association of the 
Company and section 701 of the Act, to make market purchases (as defined in section 693(4) of the Act) of up to 2,003,758 
Ordinary Shares of 0.5p each in the capital of the Company (being approximately 5% of the current issued ordinary share capital 
of the Company) on such terms and in such manner as the Directors of the Company may from time to time determine, 
provided that:
 (a)  the amount paid for each share (exclusive of expenses) shall not be more than the higher of (i) 5% above the average of the 
middle market quotation for Ordinary Shares as derived from the Daily Official List of London Stock Exchange plc for the five 
business days before the date on which the contract for the purchase is made, and (ii) an amount equal to the higher of the 
price of the last independent trade and current independent bid as derived from the London Stock Exchange Trading system 
or less than 0.5p per share; and
  ATH Resources plc Annual report and accounts 2011 61 www.ath.co.uk
Special business continued
7.  Continued
 (b)  the authority herein contained shall expire at the conclusion of the 2013 Annual General Meeting or 31 March 2013, 
whichever is earlier, provided that the Company may, before such expiry, make a contract to purchase its own shares 
which would or might be executed wholly or partly after such expiry, and the Company may make a purchase of its own 
shares in pursuance of such contract as if the authority hereby conferred hereby had not expired.
By Order of the Board
A P Weatherstone        Registered Office
Group Finance Director and Company Secretary       Aardvark House
25 January 2012       Sidings Court
          Doncaster DN4 5NU
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 62 www.ath.co.uk
Notice of annual general meeting – ATH Resources plc
continued
Notes
1.  A member who is entitled to attend and vote at the Annual General Meeting is entitled to appoint one or more proxies (who 
need not be a member of the Company) to attend and, on a poll, vote instead of the member. Completion and return of a form 
of proxy will not preclude a member from attending and voting at the meeting in person, should he subsequently decide to do so.
  The right to appoint a proxy does not apply to persons whose shares are held on their behalf by another person and who have 
been nominated to receive communications from the Company in accordance with section 146 of the Companies Act 2006 
(“nominated persons”). Nominated persons may have a right under an agreement with the registered shareholder who holds 
the shares on their behalf to be appointed (or to have someone else appointed) as a proxy. Alternatively, if nominated persons 
do not have such a right, or do not wish to exercise it, they may have a right under such an agreement to give instructions to 
the person holding the shares as to the exercise of voting rights.
2.  In order to be valid, any form of proxy and power of attorney or other authority under which it is signed, or notarially certified 
or office copy of such power or authority, must reach the Company’s registrars, Capita Registrars, The Registry, 34 Beckenham 
Road, Beckenham, Kent, BR3 4TU not less than 48 hours before the time of the meeting or of any adjournment of the meeting.       
3.  CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so 
for the Annual General Meeting to be held on 29 February 2012 and any adjournment(s) thereof by using the procedures 
described in the CREST Manual. CREST Personal Members or other CREST sponsored members, and those CREST members who 
have appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able 
to take the appropriate action on their behalf.
  In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message 
(a “CREST Proxy Instruction”) must be properly authenticated in accordance with CRESTCo’s specifications and must contain the 
information required for such instructions, as described in the CREST Manual. The message, regardless of whether it constitutes 
the appointment of a proxy or to an amendment to the instruction given to a previously appointed proxy must, in order to be 
valid, be transmitted so as to be received by the issuer’s agent (ID RA10) by the latest time(s) for receipt of proxy appointments 
specified in the notice of meeting. For this purpose, the time of receipt will be taken to be the time (as determined by the 
timestamp applied to the message by the CREST Applications Host) from which the issuer’s agent is able to retrieve the 
message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies 
appointed through CREST should be communicated to the appointee through other means.
  CREST members and, where applicable, their CREST sponsors or voting service providers should note that CRESTCo does not 
make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore 
apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if 
the CREST member is a CREST personal member or sponsored member or has appointed a voting service provider(s), to procure 
that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted 
by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST 
sponsors or voting service providers are referred, in particular, to those sections of the CREST Manual concerning practical 
limitations of the CREST system and timings.
  The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the 
Uncertificated Securities Regulations 2001.
4.  As permitted by Regulation 41 of the Uncertificated Securities Regulations 2001, shareholders who hold shares in uncertificated 
form must be entered on the Company’s share register at 6pm on 27 February 2012 in order to be entitled to attend and 
vote at the Annual General Meeting. Such shareholders may only cast votes in respect of shares held at such time. Changes 
to entries on the relevant register after that time shall be disregarded in determining the rights of any person to attend or vote 
at the meeting. 
  ATH Resources plc Annual report and accounts 2011 63 www.ath.co.uk
Form of proxy – ATH Resources plc
for use at the Annual General Meeting 
to be held at Eversheds LLP, Bridgewater Place, Water Lane, Leeds LS11 5DR, 
11.00am on Wednesday 29 February 2012
I/We .....................................................................................................................................................................................................
(Please insert full name(s) and address(es) in block letters)
of .........................................................................................................................................................................................................
being (a) member/members of the above-named Company hereby appoint the Chairman of the Meeting, or (see note 1 below) 
of .........................................................................................................................................................................................................
as my/our proxy to vote for me/us on my/our behalf at the Annual General Meeting of the Company to be held on 
Wednesday 29 February 2012 and at any adjournment thereof, and to vote as indicated below.
Please indicate how you wish your proxy to vote by inserting “X” in the box below. If no indication is given, and on any other 
resolutions proposed at the meeting, your proxy will vote or abstain from voting as he/she thinks fit. 
 Please tick here if this proxy is one of multiple appointments being made (see note 1)
  Enter number of shares in relation to which your proxy is authorised to vote or leave blank to authorise your proxy 
to act in relation to your full voting entitlement.
Resolutions: For Against Vote withheld
1 To receive the accounts for the year ended 2 October 2011.
2 To re-elect John Timothy Stokeld as a Director.
3 To re-appoint Baker Tilly UK Audit LLP as auditors and to authorise 
the Directors to determine their remuneration.
4 To receive and approve the Remuneration Committee Report.
5 To authorise the Directors to allot relevant securities pursuant  
to Section 551 of the Companies Act 2006.
6 To authorise the Directors to allot equity securities pursuant  
to Section 570 of the Companies Act 2006.
7 To authorise the purchase of shares pursuant to Section 701  
of the Companies Act 2006.
NAME: (Block capitals) ..........................................................................................................................................................................
ADDRESS: .............................................................................................................................................................................................
SIGNATURE(S): ......................................................................................................................................................................................
or COMMON SEAL ................................................... .............................................................................................................................
Date: ....................................................................................................................................................................................................
Accounts
26–64 ATH Resources plc Annual report and accounts 2011 64 www.ath.co.uk
Notes
1.  Every holder has the right to appoint some other person(s) of their choice, who need not be a shareholder as his proxy to exercise 
all or any of his rights, to attend, speak and vote on their behalf at the meeting. If you wish to appoint a person other than the 
Chairman, please insert the name of your chosen proxy holder in the space provided (see over). If the proxy is being appointed in 
relation to less than your full voting entitlement, please enter the number of shares in relation to which they are authorised to act 
as your proxy. If left blank your proxy will be deemed to be authorised in respect of your full voting entitlement (or if this proxy 
form has been issued in respect of a designated account for a shareholder, the full voting entitlement for that designated account).
2.  In order to be valid, any form of proxy and power of attorney or other authority under which it is signed, or notarially certified or 
office copy of such power or authority, must reach the Company’s registrars, Capita Registrars, The Registry, 34 Beckenham Road, 
Beckenham, Kent, BR3 4TU not less than 48 hours before the time of the meeting or of any adjournment of the meeting. 
3.  To appoint more than one proxy you may photocopy this form. Please indicate the proxy holder’s name and the number of shares 
in relation to which they are authorised to act as your proxy (which, in aggregate, should not exceed the number of shares held by 
you). Please also indicate if the proxy instruction is one of multiple instructions being given. All forms must be signed and should be 
returned together in the same envelope.
4.  The vote withheld option is provided to enable you to abstain on any particular resolution. However, it should be noted that a “vote 
withheld” is not a vote in law, and will not be counted in the calculation of the proportion of votes “For” and “Against” a resolution. 
5.  If a member is a corporation, this form of proxy must be executed under its common seal or by the signature of an officer or attorney 
duly authorised in writing. 
6.  Entitlement to attend and vote at the meeting and the number of votes which may be cast thereat will be determined by reference 
to the Register of Members of the Company as at 6pm on 27 February 2012. Changes to entries on the Register of Members after 
that time shall be disregarded in determining the rights of any person to attend and vote at the meeting.
7.  Shares held in uncertificated form (i.e. in CREST) may be voted through the CREST Proxy Voting Service in accordance with the 
procedures set out in the CREST manual. 
8.  The completion and return of this form will not preclude a member from attending the meeting and voting in person. If you attend 
the meeting in person, your proxy appointment will automatically be terminated.
9.  In the case of joint holders, the signature of any one holder will be sufficient, but the names of all joint holders should be stated, 
and the vote of the senior holder who tenders a vote will be accepted to the exclusion of the vote(s) of other joint holder(s), seniority 
being determined by the order in which the names stand in the register of members of the Company.
10. Any alterations made to this form of proxy should be initialled. A T H	R e s o u r c e s ’	c o m m i t m e n t	t o	e n v i r o n m e n t a l	i s s u e s	i s	r e fl e c t e d	i n	t h i s	
Annual Report which has been printed on Satimat Green comprising 
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