Atlantic Coal plc / Index: AIM / Epic: ATC / Sector: Mining 14 May 2012 Atlantic Coal plc ("Atlantic" or the "Company") Unaudited Preliminary Results Atlantic Coal plc, the AIM listed open cast coal production and processing company with activities in Pennsylvania, USA, is pleased to announce its unaudited preliminary results for the year ended 31 December 2011. 2011 Highlights:
* Increased production and sales experienced at Stockton during 2011 - 207,005 tons of run-of mine ("ROM") coal mined and sales of 106,403 tons reached (2010: 207,873 and 97,342 respectively) * Strengthened revenues of US$13,991,971 generated for the period (2010: US$10,720,103) and a net gross profit of US$226,946 (2010: loss of US$3,774,021) * Reduced Group loss of US$3,149,606 (2010: loss of US$5,091,659) * Purchase of a Komatsu PC2000 Hydraulic Excavator and a Reichdrill blasthole drill rig * Strengthened board in part to facilitate the roll out of consolidation strategy * Admitted shares to trading on the OTCQX Market International platform of the Pink Sheets LLC ("OTCQX") in New York to broaden investor base Current Year Highlights: � Progress made to consolidate Atlantics land position in Pennsylvania to capitalise on growing regional demand for coal o Option to lease the Pott & Bannon anthracite coal mining property in Schuykill County believed to contain 4.1 million tons ("Mt") of clean coal o Option to acquire anthracite mining assets for a purchase price of US$35 million � 12% increase in production at Stockton and 24% increase in average sales price experienced in Q1 2012 to 31,729 tons at $166.30 (Q1 2011: 28,376 tons at $134.25) � Completion of the Norfolk & Southern Railroad diversion providing access to approximately 1.0 million tons of previously unworkable coal Atlantic Managing Director Stephen Best said, "2011 was a year in which we laid the foundations to facilitate growth over the coming years.

Expansion was and remains high on our agenda.

Post period end, our hard work paid off, culminating in the acquisition of options over a range of sites in Pennsylvania that we believe have the potential to transform our production profile if deemed suitable by the Company following a period of stringent due diligence. "At Stockton, we continued negotiating the diversion of the railroad to allow access to over 1Mt of coal.

With this now complete, an independent mining report has highlighted the potential to build upon the steady production experienced in 2011, providing the Company with another potential avenue for growth.

We look forward to updating shareholders on both fronts over the coming months." Chairmans Statement In tandem with overseeing and improving the production profile of our Stockton Colliery anthracite mine, regional consolidation in the Pennsylvanian anthracite fields was Atlantics predominant focus with much of the year spent evaluating various opportunities.

We were therefore delighted to announce post-period end that we had acquired options over a number of sites, which, if acquired, the Board believes would fulfil this strategy.

Due diligence is currently underway at the various option sites and further updates will be made at the appropriate time. Stockton The Stockton mine site covers an area of approximately 900 hectares located in the Hazel Creek Valley, a prime anthracite region with high quality coal reserves with demand for our product in the industrial and heating markets.

The buoyancy of the market is demonstrated by the increased average price of US$142.33 (2010: $124.43) received for our product during the year.

Post period end, prices increased further and during the first quarter of 2012, we received an average price of $166.30. During 2011 Atlantic mined 207,005 tons of run-of-mine coal (2010: 207,873) and removed 3,257,776 bank cubic yards ("BCY") of overburden (2010: 2,837,863).

233,241 tons of ROM coal was washed (2010: 229,293) which produced 100,713 tons of clean coal (2010: 88,620).

Sales for the year were 106,403 tons (2010: 97,349).

The run-of-the mine coal mined in 2011 is marginally lower than the 208,730 BCY and 105,403 tons of clean coal announced for the same period in January 2012 as a result of adjustments made during the audit for the year ended 31 December 2011. As a result of various mechanical difficulties experienced with the Companys excavators and a delay in the diversion of the Norfolk and Southern railroad previously running through the Companys site, we did not reach our targeted annual production of 300,000 tons of ROM for 2011.

To address this we invested in a second hand Komatsu PC2000 hydraulic excavator and ordered a second Liebherr R9250 19-yard bucket hydraulic excavator.

This excavator is scheduled for delivery in H2 2012.

Additionally, we carried out an overhaul programme of the existing truck fleet and outsourced the reclamation work at the Companys Gowen site which freed up two Cat 777 trucks to provide additional haul truck capacity for the two excavators working at the Stockton site. Most importantly our production capacity was further improved in April 2012 following the railroad diversion completion allowing access to approximately 1.0Mt of ROM coal. With this in mind, we commissioned an independent mining report by Mine Engineers Inc.

to evaluate our mine plan and operations at Stockton.

The report highlighted that, with the diversion of the railroad now complete, production of 160,000 tons of clean coal is achievable for the year to 31 December 2012.

The projected 2012 strip ratio of 17:7 set out in the independent mining report also compares very favourably with the 2010 and 2011 strip ratios of approximately 32:1. Acquisition Update In January 2012 we announced the entry into a lease option agreement with Pennsylvania based Reading Anthracite Company which holds a permitted 410 acre anthracite mining property.

We estimate the site to contain Reserves of 12Mt ROM coal at 3.9 ratio.

This equates to 4.1Mt of clean coal, thus providing the potential to more than double our existing anthracite reserves.

Importantly, the site is located 25 miles from the Companys Stockton site which has established infrastructure and domestic and international demand for anthracite coal.

We have a six month period during which to conduct due diligence and, should we decide to proceed with the acquisition, a consideration of c.

US$6.0 million in cash and shares will be paid to Reading Anthracite Company, along with the grant of US$3.0 million of warrants in Atlantic at 0.75 pence per share. Additionally, on 15 February 2012 we announced that we had entered into an option agreement to acquire additional anthracite mining assets in Pennsylvania.

This option, which is exercisable entirely at the Companys discretion, has an exercise price of US$35 million and the exercise period ends on 31 October 2012.

As a result of the size of the exercise price, the acquisition of the assets in question would be likely to constitute a reverse takeover under the AIM Rules for Companies and would therefore be, inter alia, subject to shareholder approval.

Due diligence is on-going and further announcements will be made at the appropriate time. Financials During 2011 we raised a total of �12.3 million (before expenses).

This included a placing of �300,000 with the Blackrock UK Smaller Companies Fund in January 2011 to satisfy market demand.

In February 2011 we successfully completed a further fundraising of �12.0 million (before expenses), allowing us to order new equipment and implement our mine plan at Stockton.

Additionally, we have been able to leverage our cash position to pursue acquisition opportunities. These funds to date have been used to:
* Improve the capitalisation of the Stockton mine, including truck engine rebuilds, fleet additions, completion of the railroad diversion and outsourcing of the Gowen reclamation obligation * Secure options to acquire additional anthracite mining assets * Debt repayment Corporate On 30 August 2011, we announced that the Companys shares had been admitted to trading on the OTCQX.

We are confident that our shareholders will benefit from this exposure and increased visibility within the US where our primary asset is located. Board Changes In June and July 2011 we strengthened the Companys Board and management team.

Eddie Nelson joined the Board as Non-executive Director in July 2011.

Mr.

Nelson is a qualified mining engineer and his extensive experience in the coal sector throughout his 38 year career is beneficial to the Company. We also appointed Mr.

Barney Corrigan as Project Development Officer during the period to focus on increasing our project portfolio, resource base and production profile. Outlook The year ahead is set to be positive for Atlantic.

With the diversion of the railroad now complete, we are confident that our production profile at Stockton will improve as underpinned by an independent report which assesses our current mine plan and equipment on site.

Expansion is also at the forefront of our strategy.

With due diligence progressing well at both option sites, we believe that the Company is in a strong position to build on its current footprint in Pennsylvania.

Through this we anticipate that Atlantic will be positioned to capitalise on the rising demand for coal in the US and internationally. In the three months ended 31 March 2012, production at Stockton increased 12% to 31,729 tons of clean coal compared to the equivalent period in 2011 (Q1 2011: 28,376).

During the period Atlantic removed 715,691 BCY of overburden (Q1 2011: 658,785) and 85,911 tons of ROM coal was washed (Q1 2011: 62,000).

At the same time there has been a substantial increase in the average sale price of Pennsylvanian anthracite with a Q1 2012 average price of $166.30 per ton compared with a Q1 2011 price of $134.25, an increase of approximately 24%. Adam Wilson Chairman **ENDS** For further information on the Company, visit: www.atlanticcoal.com or contact: Steve Best Atlantic Coal plc Tel: 020 3328 5670 Nick Naylor Allenby Capital Limited Tel: 020 3328 5656 Alex Price Allenby Capital Limited Tel: 020 3328 5656 Peter Rose FoxDavies Tel: 020 3463 5030 Simon Leathers FoxDavies Tel: 020 3463 5010 Hugo de Salis St Brides Media & Finance Ltd Tel: 020 7236 1177 Elisabeth Cowell St Brides Media & Finance Ltd Tel: 020 7236 1177
BALANCE SHEETS As at 31 December 2011
Group
Company
As at 31 December 2011 $ As at 31 December 2010 $
As at 31 December 2011 $ As at 31 December 2010 $ Non-Current Assets
Property, plant and equipment
10,037,008 6,915,151
316,614 2,047 Land, coal rights and restoration
7,980,327 7,621,494
- - Investment in subsidiary
- -
- 9,923,011 Trade and other receivables
9,441 -
22,786,441 14,368,596 Other assets 43,752 236,467 - -
18,070,528 14,773,112
23,103,055 24,293,654 Current Assets
Inventories
1,471,210 1,241,232
- - Trade and other receivables
1,833,404 1,310,932
652,456 35,318 Other assets
197,971 236,467
- - Cash and cash equivalents
6,027,771 -
5,941,398 83,117
9,530,356 2,844,597
6,593,854 118,435 Total Assets
27,600,884 17,617,709
29,696,909 24,412,089 Current Liabilities
Trade and other payables
3,119,637 4,604,594
229,036 436,827 Borrowings
3,828,776 5,595,593
- 2,195,857 Accrued restoration costs
1,841,251 3,256,865
- -
8,789,664 13,457,052
229,036 2,632,684 Non-Current Liabilities
Borrowings
1,770,338 4,665,043
- - Accrued restoration costs
4,054,350 3,923,710
- -
5,824,688 8,588,753
- - Total Liabilities
14,614,352 22,045,805
229,036 2,632,684 Net (Liabilities) / Assets
12,986,532 (4,428,096)
29,467,873 21,779,405 Capital and Reserves Attributable to Equity Holders of the Company
Called up share capital
4,595,188 2,394,507
4,595,188 2,394,507 Share premium account
38,661,407 19,415,088
38,661,407 19,415,088 Merger reserve
15,326,850 15,326,850
1,111,305 11,824,997 Reverse acquisition reserve
(12,999,288) (12,999,288)
- - Other reserves
131,837 352,518
131,837 352,518 Foreign currency translation reserve
(3,521,802) (2,672,814)
(7,779,350) (6,975,265) Retained earnings / (losses)
(29,207,660) (26,244,957)
(7,252,514) (5,232,440) Total Equity
12,986,532 (4,428,096)
29,467,873 21,779,405
GROUP INCOME STATEMENT For the year ended 31 December 2011
Group
For the year ended 31 December 2011 $ For the year ended 31 December 2010 $ Revenue
13,991,971 10,720,103 Cost of sales
(13,765,025) (12,700,591) Gross profit/(loss)
226,946 (1,980,488) Administration expenses
(3,158,662) (2,181,545) Other gains/(losses) - net
202,344 370,825 Other income
- 17,187 Operating Loss
(2,729,372) (3,774,021) Finance income
50,153 - Finance costs
(470,387) (1,317,638) Loss Before Taxation
(3,149,606) (5,091,659) Corporation tax expense
- - Loss for the Year
(3,149,606) (5,091,659) Attributable to the equity owners of the Parent
(3,149,606) (5,091,659)
Loss per share attributable to the equity owners of the Parent during the year:
Basic and diluted
(0.09) cents (0.31) cents
All activities are classified as continuing.
GROUP CASH FLOW STATEMENT For the year ended 31 December 2011
Group
For the year ended 31 December 2011 $ For the year ended 31 December 2010 $ Cash flows from operating activities
Operating loss
(2,729,372) (3,774,021) Adjustments for:
Depreciation
946,592 1,067,976
Amortisation
418,303 315,270
Consultancy fees paid in shares
- 52,407
Gain on Mayford debt settlement
(78,388) -
Accretion and accrued restoration costs
481,843 1,718,279
Reclamation work performed
(1,766,818) (1,824,347)
Provision for doubtful debts
(16,522) 280,098
Foreign exchange gains
(179,930) (379,142) (Increase) in trade and other receivables
(16,483) (219,431) (Decrease)/increase in inventories
(229,978) 519,816 (Decrease)/increase in trade and other payables
(1,228,486) 928,569 Net cash used in operations
(4,399,239) (1,314,526)
Cash flows from investing activities
Purchase of property, plant and equipment
(4,264,457) (884,466) (Increase)/decrease in deposits & escrow
(508,055) 19 Loans granted to third parties
- (100,000) Loan repayments received from third parties
- 10,000 Interest paid
(290,791) (203,844) Interest received
50,153 - Net cash used in investing activities
(5,013,150) (1,178,291)
Cash flows from financing activities
Proceeds from issue of share capital
19,997,820 3,217,417 Transaction costs of share issue
(1,027,569) (65,947) Proceeds from exercise of options & warrants
1,550,495 - Proceeds from loans & borrowings
- 1,206,321 Repayments of borrowings
(3,944,281) (1,415,219) Borrowing costs
- (389,577) Interest paid
(284,628) (222,106) Finance lease payments
(664,934) (342,516) Net cash from financing activities
15,626,903 1,988,373 Net increase / (decrease) in cash and cash equivalents
6,214,514 (504,444) Effect of foreign exchange rate changes
(479,176) (46,930) Cash and cash equivalents at beginning of year
292,433 843,807 Cash and cash equivalents at end of year
6,027,771 292,433 The increase in deposits held in Escrow was the result of the deposit paid on the Pott & Bannon option. Significant Non Cash Transactions During 2011 the Convertible Note was part converted into 107,264,476 ordinary shares
COMPANY CASH FLOW STATEMENT For the year ended 31 December 2011
Company
For the year ended 31 December 2011 $ For the year ended 31 December 2010 $ Cash flows from operating activities
Operating loss
(12,722,885) (6,535,581) Adjustments for:
Depreciation
5,862 2,029
Foreign exchange losses
- (4,443)
Consultancy fees paid in shares
- 52,407
Provision for doubtful debts
- 280,098
Impairment of investment
10,713,692 5,287,465 (Increase)/decrease in trade and other receivables
(127,670) 37,819 Decrease in operating payables
(222,426) (41,988) Net cash used in operations
(2,353,427) (922,194)
Cash flows from investing activities
Loans to subsidiary
(9,508,822) (2,625,921) Repayments received from subsidiary
166,472 146,258 Interest received
50,153 - Purchase of property, plant & equipment
(324,935) - Increase in deposits & escrow
(502,799) - Loans granted to third parties
- (100,000) Loan repayments received from third parties
- 10,000 Net cash used in investing activities
(10,119,931) (2,569,663)
Cash flows from financing activities
Proceeds from issue of share capital
19,997,820 3,217,417 Transaction costs of share issue
(1,027,569) (65,947) Proceeds from exercise of options & warrants
1,550,495 - Borrowing costs
- (389,577) Interest paid
(284,628) (222,106) Repayment of borrowings
(1,425,303) (850,219) Proceeds from borrowings
- 1,206,321 Net cash from financing activities
18,810,815 2,895,889
Net Increase/(decrease) in cash and cash equivalents
6,337,457 (595,968) Cash and cash equivalents at beginning of year
83,117 726,015 Effect of foreign exchange rate changes
(479,176) (46,930) Cash and cash equivalents at end of year
5,941,398 83,117
The increase in deposits held in Escrow was the result of the deposit paid on the Pott & Bannon option. Significant Non Cash Transactions During 2011 the Convertible Note was part converted into 107,264,476 ordinary shares Notes to the Financial Statements Basis of Preparation of Financial Statements The Financial Statements have been prepared in accordance with EU-endorsed International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations and the parts of the Companies Act 2006 applicable to companies reporting under IFRS.

The Financial Statements have also been prepared under the historical cost convention other than financial assets and financial liabilities at fair value through profit or loss. The Financial Statements are presented in US Dollars rounded to the nearest dollar. Atlantic Coal Plc, the legal parent, is domiciled and incorporated in the United Kingdom. The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates.

It also requires management to exercise its judgement in the process of applying the Groups Accounting Policies.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Financial Statements are disclosed in Note 2. The financial information set out above does not constitute the Companys statutory accounts within the meaning of Section 435 of the Companies Act 2006.

The figures for the year ended 31 December 2011 are based on unaudited accounts for the year ended 31 December 2011.

The directors anticipate that the auditors report, to be issued with the Groups statutory accounts for the year ended 31 December 2011 will be unqualified. The unaudited preliminary announcement has been prepared on the basis of accounting policies set out in the Groups statutory accounts for the year ended 31 December 2010. The comparatives for the year ended 31 December 2010 are derived from the statutory accounts for the year ended 31 December 2010.

These statutory accounts, which contain an unqualified audit report under Section 495 of the Companies Act 2006 and which did not make any statement under Section 498 of the Companies Act 2006, have been delivered to the registrar of companies in accordance with Section 441 of the Companies Act 2006. The Company will announce its full audited financial statements and accompanying notes later in May 2012. Segmental Information Management has determined the operating segments based on reports reviewed by the Board of Directors that are used to make strategic decisions.

During the year Group had interests in two geographical segments, the United Kingdom and the United States of America ("USA").

Activities in the UK are mainly administrative in nature whilst the activities in the USA relate to coal sales and production. The reportable operating segments derive their revenue from the sale of prepared coal to industrial and retail customers.
For the year ended 31 December 2011
For the year ended 31 December 2010
USA
UK Intra-segment balances
Total
USA
UK Intra-segment balances Total
$ $ $ $ $ $ $ $ Revenue from external customers
13,991,971
-
-
13,991,971
10,720,103
-
-
10,720,103 Gross profit/(loss) 226,946 - - 226,946 (1,980,488) - - (1,980,488) Operating loss (720,182) (12,722,882) 10,713,692 (2,729,372) (2,521,462) (6,535,581) 5,283,022 (3,774,021) Impairment - (10,713,692) 10,713,692 - - (5,287,465) 5,287,465 - Depreciation 940,730 5,862 - 946,592 1,065,947 2,029 - 1,067,976 Amortisation 418,303 - - 418,303 315,270 - - 315,270 Capital expenditure 3,361,886 320,235 - 3,682,121 3,662,757 - - 3,662,757 Total assets 20,680,975 29,696,909 (22,777,000) 27,600,884 17,497,225 24,412,089 (24,291,605) 17,617,709 Total liabilities 37,907,730 229,036 (23,522,414) 14,614,352 33,781,347 2,632,684 (14,368,226) 22,045,805
A reconciliation of operating loss to loss before taxation is provided as follows:
For the year ended 31 December 2011 For the year ended 31 December 2010
$ $
Operating loss for reportable segments (2,729,372) (3,774,021)
Finance income 50,153 - Finance costs (470,387) (1,317,638)
Loss before tax (3,149,606) (5,091,659)
Information about major customers Revenues of approximately $2.633 million (2010: $1.565 million) were derived from a single external customer.

These revenues were all generated in the USA. Cash and Cash Equivalents
Group
Company
As at 31 December 2011 $ As at 31 December 2010 $
As at 31 December 2011 $ As at 31 December 2010 $ Cash at bank and in hand 6,027,771 292,433
5,941,398 83,117
Loss per Share The calculation of the basic loss per share of 0.09 cents (31 December 2010 loss per share: 0.31 cents) is based on the loss attributable to ordinary shareholders of $3,149,606 (31 December 2010 loss: $5,091,659) and on the weighted average number of ordinary shares of 3,583,708,122 (31 December 2010: 1,653,929,227) in issue during the year. The basic and diluted loss per share is the same, as the effect of the exercise of share options and warrants would be to decrease the loss per share.
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