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Increase in Coal Production at JSW

|   Investors Relations - common

According to the primary estimates, the JSW mines produced in the first quarter of 2012 approximately 240 thousand tonnes of coal more than it was planned.

During this period, also more roadways were driven than it was assumed in the technical plan. The plan of works was exceeded by 1,694 running metres, which is a proof of the Company’s preparations for increased extraction plans for the upcoming year. By 2015, JSW intends to reach an annual extraction level amounting to 14 million tonnes.

“Our strategic goal is to increase productivity and effectiveness in order to reduce the negative effect of high fixed costs on the Group’s profit,” says Jarosław Zagórowski, the President of JSW S.A. “This data confirms that thanks to proper work organisation we can not only carry out our production and investment plans, but also markedly exceed them.”

March will be the first month when JSW will pay to the employees who exceeded the plans regarding extraction and preparatory works, a special incentive bonus. Activities rewarding the most committed and effective employees were introduced despite no consent of the trade unions to this form of rewards.

“Activities rewarding the most committed employees are a standard in every professionally managed company. It is important for us that the employees of JSW understand the Company’s needs regarding extraction, productivity and development. Better work effects are not only an opportunity to increase the remuneration, but mean also an increase of Company’s value and a higher share price,” underlines Jarosław Zagórowski.

According to the primary JSW estimates, additional production of coking coal and power coal, in large amount has been located on the market. The Company observes also a gradual decrease in coke stock in the Group (higher stock in winter months are only of seasonal character) with a simultaneous increase in the level of the use of production capacity. A growth of recipients’ interest in coke is a sign of a revival on the steel market. The predictions of the Management Board of JSW, regarding a revival on the market at the end of the first quarter of the current year, prove, thus, to have been correct. The President of the Management Board reserves, however, that it is too soon to regard this trend to be stable.

JSW will present detailed information, including financial data for three months of the current year, on 10 May, in a report for the first quarter of 2012.