Fording announces fourth quarter cash distribution
07 Dicembre 2005 - 10:22PM
PR Newswire (US)
2005 Guidance Revised CALGARY, Dec. 7 /PRNewswire-FirstCall/ --
Fording Canadian Coal Trust (TSX: FDG.UN, NYSE: FDG) today
announced that its fourth quarter cash distribution of C$1.60 per
unit will be paid on January 13, 2006 to unitholders of record on
December 30, 2005. This brings total distributions for the 2005
calendar year to C$4.77 per unit, compared with C$1.47 paid in
2004. The ex-distribution date is December 28, 2005. This
distribution is for the period from October 1, 2005 to December 31,
2005. Guidance Update There is a significant global shortage of
haulage truck tires due to substantial growth in demand and limited
manufacturing capacity. Suppliers have advised Elk Valley Coal that
tires will be provided on an allocation basis amongst customers.
This allocation is expected to restrict Elk Valley Coal's
production capacity in 2006 to approximately 24 to 25 million
tonnes. The Trust anticipates this tire shortage will continue into
2007 and may contribute to constraining supply of hard coking coal
over this period. The Trust is revising its expectations for coal
sales volumes for the 2005 calendar year. Due to customer delay of
shipments beyond the fourth quarter, Elk Valley Coal's 2005 sales
volumes are now estimated to be approximately 24 million tonnes, of
which the Trust's share is 60%. This revision is largely
attributable to customers over-committing for coal early in 2005 to
protect against the possibility of supply interruptions, which have
not materialized. Update on Government of Canada's Consultation
Process for Trusts On November 23rd, Minister of Finance Ralph
Goodale announced an early end to the public consultation process
relating to income trusts by proposing a reduction in the federal
income tax imposed on dividends paid to individuals after 2005 by
Canadian resident corporations. The Government's announcement means
that no changes will be made to the tax treatment of income trusts
as a result of the consultation process. Tax Information for Cash
Distributions The information below is provided to assist
unitholders in understanding the tax treatment of distributions
paid by the Trust. For unitholders resident in Canada, income
distributed by the Trust will generally be treated as ordinary
income from property except where the income is sourced from
capital gains realized by the Trust or from dividends received by
the Trust. In these cases, the Trust intends to make appropriate
designations in its tax returns so that the capital gains or
dividends will retain their character when distributed to
unitholders and will be subject to income tax accordingly.
Distributions to unitholders made in a year that are greater than
the net income of the Trust for the year will not be included in
unitholders' income but will be considered a return of capital and
a reduction of the cost base of the units. Income distributed by
the Trust to non-residents of Canada will be subject to Canadian
withholding tax of 25% subject to reduction under the provisions of
any applicable tax treaty or conventions. Canadian withholding tax
is generally 15% for U.S. holders. The Trust has made an election
to be taxed as a corporation for U.S. tax purposes. Accordingly,
distributions by the Trust will be considered foreign- source
dividend income to the extent paid out of current or accumulated
earnings and profits of the Trust, determined under U.S. income tax
principles. Assuming that applicable unitholder-level requirements
are met, these distributions are "qualified dividends," eligible
for taxation at reduced rates under recent U.S. federal income tax
legislation. Payments in excess of current or accumulated earnings
and profits will be applied first to reduce the cost base of the
units and then as a capital gain should the cost base of the units
be reduced to zero. The Trust will issue a statement after the
close of its fiscal year (December 31) that will provide
information for Canadian and U.S. resident investors about the
final characterization of the 2005 Trust distributions for income
tax purposes. Unitholders should consult their own tax advisors for
advice with respect to the income tax consequences based on their
particular circumstances. About Fording Fording Canadian Coal Trust
is an open-ended mutual fund trust. Through investments in
metallurgical coal and industrial minerals mining and processing
operations, the Trust makes quarterly cash distributions to
unitholders. The Trust, through its subsidiaries, holds a 60%
interest in the Elk Valley Coal Partnership and is the world's
largest producer of the industrial mineral wollastonite. Elk Valley
Coal Partnership, comprised of Canada's senior metallurgical coal
mining properties, is the world's second largest exporter of
metallurgical coal, supplying high-quality coal products to the
international steel industry. The Trust's shares are traded on the
Toronto Stock Exchange under the ticker symbol FDG.UN and on the
New York Stock Exchange under the symbol FDG. Forward-looking
Information Certain information included in this document is of a
forward-looking nature. Forward-looking information is subject to
known and unknown risks, as well as uncertainties and other
factors. Accordingly, actual results may differ materially from
those expressed or implied in forward-looking information. Some of
the risks, uncertainties and other factors affecting Fording
Canadian Coal Trust are discussed in our public filings with the
securities regulatory authorities in Canada and the United States.
Copies of Fording Canadian Coal Trust's Canadian filings, including
our most recent management information circular, annual information
form, annual report, quarterly reports, material change reports and
news releases, are available online at http://www.sedar.com/, and
copies of our U.S. filings, including our most recent annual report
on Form 40-F as supplemented by filings on Form 6-K, are available
at http://www.sec.gov/. Information in this document is presented
as of December 7, 2005 and is subject to change after this date.
However, Fording Canadian Coal Trust disclaims any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
DATASOURCE: Fording Canadian Coal Trust CONTACT: Susan J.
Soprovich, Director, Investor Relations, Fording Canadian Coal
Trust, (403) 260-9834; Catherine Hart, Investor Relations Analyst,
Fording Canadian Coal Trust, (403) 260-9817; Email: Website:
http://www.fording.ca/
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