Forbes Coal Revenue Increases 80% to $35.2 Million in Second Quarter 2012 as a Result of Record Export Sales

TORONTO, ONTARIO -- (MARKET WIRE) -- 10/18/11 -- Forbes & Manhattan Coal Corp. (TSX: FMC)(JSE: FMC) ("Forbes Coal" or the "Company") is pleased to announce its second quarter 2012 financial results for the three months ended August 31, 2011 (References to Q1 2012 or the first quarter 2012 mean the three months ended May 31, 2011. References to Q2 2012 or the second quarter 2012 mean the three months ended August 31, 2011.)

Second Quarter Financial Highlights: (All figures are in Canadian dollars,
 unless otherwise stated)

                        ----------------------------------------------------
                            Second Quarter     First Quarter
                                      2012              2012
                            (June - August      (March - May
                                     2011)             2011)      % Increase
----------------------------------------------------------------------------
Revenue                      $35.2 million     $19.6 million          + 80 %
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Gross profit                  $5.6 million      $4.2 million          + 34 %
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Consolidated EBITDA
(see non-GAAP measures)       $6.9 million      $5.8 million          + 19 %
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Slater Stand Alone
 EBITDA
(see non-GAAP measures)       $9.2 million      $6.2 million          + 48 %
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Cash and cash
 equivalents                 $24.2 million     $19.8 million          + 22 %
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The sharp increase in revenue is a direct result of the Company's record export sales in the second quarter of 2012. Total export sales in the second quarter of 2012 were 192,400 tonnes, a 109% increase compared to first quarter 2012 export sales of 91,800 tonnes. Fiscal year-to-date export sales are 284,200 tonnes.

Slater stand alone EBITDA for the quarter increased by 109% from $4.4 million to $9.2 million year over year.

"The quarter's results further highlight the excellent progress that we have made at an operational level. Phase Two of production ramp up at Magdalena and Aviemore is well underway. The second continuous miner at Magdalena is currently being commissioned. Bituminous and anthracite coal prices remain steady, even in an uncertain global economic environment," said Stephan Theron, President and Chief Executive Officer. "This quarter also marked the first time that total export sales were greater than total domestic sales and we expect this trend to continue."

Fiscal year-to-date figures are: Revenue of $54.9 million; Gross Profit of $9.8 million; Consolidated EBIDTA of $12.7 million; Slater Stand Alone EBIDTA of $15.4 million.

Operational highlights

Production at Forbes Coal's two mines, Aviemore and Magdalena, continues to increase on plan and on budget. Commissioning of the second phase of expansion at Magdalena is on track for the third quarter of 2012 with the new Continuous Miner underground and in the process of being commissioned.

Operational highlights include:

ROM Production

--  ROM production at Aviemore in the second quarter of 2012 was 64,200
    tonnes, an increase of 27% compared to the 50,700 tonnes produced in the
    first quarter of 2012. Fiscal year- to -date ROM production at Aviemore
    was 114,900 tonnes.

--  Production at Magdalena remained consistent in the second quarter of
    2012. ROM production in Q2 2012 was 258,600 tonnes compared to 260,300
    tonnes in Q1 2012. Fiscal year- to- date ROM production at Magdalena was
    518,900 tonnes.

--  Total ROM production in the second quarter of 2012 was 322,800 tonnes, a
    4% improvement compared to the 311,000 tonnes of total ROM production in
    the first quarter of 2012. Fiscal year- to- date total ROM production
    was 633,800 tonnes.

Saleable Production and Sales

--  Saleable production at Aviemore was 39,100 tonnes in the second quarter
    of 2012, an increase of 23% compared to the 31,800 tonnes produced in
    the first quarter of 2012. Fiscal year- to- date saleable production at
    Aviemore was 70,900 tonnes.

--  Saleable production at Magdalena was 179,600 tonnes compared to 175,400
    tonnes in the second quarter of 2012. Fiscal year-to-date saleable
    production at Magdalena was 355,000 tonnes.

--  Total saleable production in the second quarter of 2012 was 218,700
    tonnes, a 6% improvement compared to the 207,200 tonnes of total
    saleable production in the first quarter of 2012. Fiscal year-to-date
    total sales production was 425,900 tonnes.

--  Total export sales in the second quarter of 2012 was 192,400 tonnes, a
    109% increase compared to first quarter 2012 export sales of 91,900
    tonnes. Fiscal year-to-date total export sales was 284,300 tonnes.

--  Total domestic sales in the second quarter of 2012 was 147,400 tonnes, a
    49% increase compared to the first quarter 2012 domestic sales of 99,000
    tonnes. Fiscal year- to -date total domestic sales were 246,400 tonnes.

--  Total sales in the second quarter of 2012 was 339,800 tonnes, a 78%
    increase compared to first quarter 2012 total sales of 190,800 tonnes.
    Fiscal year-to-date total sales was 530,600 tonnes.

--  Saleable product transported to the Navitrade port in second quarter
    2012 was 155,500 tonnes, an increase of 89% compared to the first
    quarter 2012. Total saleable product transported to Navitrade for fiscal
    year-to-date 2012 was 237,600 tonnes.

--  Coal dispatched through Navitrade to overseas markets in second quarter
    2012 was 167,500, an increase of 114% compared to 78,000 dispatched in
    first quarter 2012. Total coal dispatched through Navitrade to overseas
    markets for fiscal year-to-date 2012 was 245,500 tonnes.

--  Stock at the Navitrade terminal at the end of the second quarter 2012
    was 34,900 tonnes.

SUMMARIZED FINANCIAL RESULTS OF SLATER COAL

----------------------------------------------------------------------------
                         Summarized Financial Results (Actual)
                                     Slater Coal

                                            Three months    Six months ended
                                              ended (i)            (i)
                                           August   August   August   August
                                              31,      31,      31,      31,
                                             2011     2010     2011     2010

Run of Mine (ROM) (t)                     322,765  232,218  633,767  429,962
Saleable production (t)                   218,724  164,927  425,913  299,903
Plant feed (t)                            327,744  235,209  630,813  442,568
Yield (%) on ROM                            67.8%    71.0%    67.2%    69.8%
Yield (%) on Plant feed                     66.7%    70.1%    67.5%    67.8%
Inventory tonnes balance open             204,396  107,145  189,778   86,742
Inventory tonnes balance close             82,425  129,269   82,425  129,269
Sales (t)                                 339,802  142,803  530,629  257,376

Revenue 000,000's ($)                        35.2     12.2     54.9     21.9
EBITDA 000,000's ($)                          9.2      4.4     15.4      7.7

CDN$: US$ (average)                          0.97     1.04     0.97     1.03
ZAR: CDN (average)                           7.09     7.19     7.07     7.25

Selling price (average) / sold
 production t (CAD$)                       103.59    85.24   103.37    85.09
Selling price (average) / sold
 production t (US$)                        106.54    81.85   106.55    82.61

Cash cost of sales and operating
 expenses CAD 000,000's ($)                  24.1      8.0     36.6     13.8
Cash cost of sales and operating
 expenses/sold production t (CDN$)          70.92    56.36    68.96    53.62
Cash cost of sales and operating
 expenses/sold production t (US$)           72.94    54.12    71.09    52.06

Capital expenditures 000,000's (CAD$)        2.30     1.01     3.97     2.71
Capital expenditures per t of saleble
 production $                               10.51     6.12     9.32     9.04

Numbers in this chart are derived from the Slater
 Coal stand alone financial statements.
These are not affected by the adjustments related to the purchase
 price allocation or consolidation adjustments.
See non GAAP measures.
----------------------------------------------------------------------------

     (i) The Slater Coal results presented in the chart above for the
     three and six months ended August 31, 2010 have not been reported in
     the consolidated financial statements of the Company in full. Only
     results for a period from the date of acquisition (July 29, 2010) have
     been consolidated. Also the comparative period for reporting purposes
     is the three months ended September 30 2010.

NON-GAAP PERFORMANCE MEASURES

The Company has included in this document certain non-GAAP performance measures that are detailed below. These non-GAAP performance measures do not have any standardized meaning prescribed by GAAP and, therefore, may not be comparable to similar measures presented by other companies. The Company believes that, in addition to conventional measures prepared in accordance with GAAP, certain investors use this information to evaluate the Company's performance. Accordingly, they are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared with GAAP. The definition of these performance measures and reconciliation of the non-GAAP measures to reported GAAP measures are as follows:

EBITDA - Forbes Coal consolidated

----------------------------------------------------------------------------
                                               Three months       Six months
                                                      ended            ended
                                            August 31, 2011  August 31, 2011
                                                     $000's           $000's
----------------------------------------------------------------------------
Net income (loss) for the period                    (1,421)          (2,426)
add back
Amortization and depletion                            5,520            8,448
Income tax expense                                    2,190            3,068
Foreign exchange gain/loss                            (236)               72
Interest and dividend income                            209              521
Accretion                                               528            1,065
Business combination transaction costs                    3               22
Stock based compensation                                 92            1,932
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EBITDA Forbes Coal Consolidated                       6,885           12,702
----------------------------------------------------------------------------

EBITDA - Slater Coal stand alone

----------------------------------------------------------------------------
                                               Three months       Six months
                                                      ended            ended
                                            August 31, 2011  August 31, 2011
                                                     $000's           $000's
----------------------------------------------------------------------------
Net income (loss) for the period                    (1,421)          (2,426)
add back
Amortization and depletion                            5,520            8,448
Income tax expense                                    2,190            3,068
Foreign exchange gain/loss                            (236)               72
Interest and dividend income                            209              521
Accretion                                               528            1,065
Business combination transaction costs                    3               22
Stock based compensation                                 92            1,932
General and administration (Non Slater)               2,273            2,705
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EBITDA Slater Coal                                    9,158           15,407
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About Forbes Coal

Forbes Coal is a growing coal producer in southern Africa. It holds a majority interest in two operating mines through its 76.75% interest in Slater Coal (Pty) Ltd., a South African company ("Slater Coal") which has a 70% interest in Zinoju Coal (Pty) Ltd. ("Zinoju"). Zinoju holds a 100% interest in the Magdalena bituminous mine and the Aviemore anthracite mine in South Africa (collectively, "the Slater Properties"). The mines have a resource of 51.7 million tonnes of bituminous and 50.8 million tonnes of anthracite coal and each mine has a projected life span in excess of 20 years. Forbes Coal is in the process of increasing production at both mines and looks to triple production from 2010 levels in the next three years using existing infrastructure and capacity. The Company has in-place transportation infrastructure allowing its coal to reach both export corridors and the growing domestic coal market. Forbes Coal has a strong balance sheet and an experienced coal-focused management team.

Please refer to the Company's NI 43-101 compliant technical report on the Slater Coal Properties dated March 1, 2011 entitled "Technical Report on Slater Coal and Subsidiaries, KwaZulu-Natal Province, South Africa", available on the SEDAR profile of the Company at www.sedar.com. Additional information is available at www.forbescoal.com.

Johan Odendaal, B.Sc.(Geol.), B.Sc.(Hons)(Min. Econ.), M.Sc. (Min. Eng.), a director of Minxcon and an independent Qualified Person, as defined in National Instrument 43-101 has reviewed and approved the scientific and technical information contained in this release.

Cautionary Note Regarding Forward-Looking Information This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the anticipated production results at the Slater Properties, future financial or operating performance of the Company and its projects, statements regarding transportation, infrastructure and the prospects for the business of the Company, requirements for additional capital, government regulation of the mineral exploration industry, environmental risks, acquisition of mining licences, title disputes or claims, limitations of insurance coverage and the timing and possible outcome of pending litigation and regulatory matters. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, foreign operations, political and social uncertainties; a history of operating losses; delay or failure to receive board or regulatory approvals; timing and availability of external financing on acceptable terms; not realizing on the potential benefits of the proposed transaction; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of mineral products; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; and, delays in obtaining governmental approvals or required financing or in the completion of activities. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

Contacts:
Forbes & Manhattan Coal Corp.
Stephan Theron
President and Chief Executive Officer
+1 (416) 861-5912
This email address is being protected from spambots. You need JavaScript enabled to view it.

Forbes & Manhattan Coal Corp.
Sabina Srubiski
Investor Relations Manager
+1 (416) 309 2957
This email address is being protected from spambots. You need JavaScript enabled to view it.
www.forbescoal.com