Defying wet weather and limited availability of trucks, sales of 46,269 tonnes for April were up 3% on the previous month.
Shares increase 30%
Shares were up as much as 30% during the day to a high of 1.3 cents.
The monthly sales total was 25% higher than the corresponding month of 2017.
Year-to-date sales are 431,619 tonnes compared with 334,529 tonnes in the same period of 2017.
Higher stockpile levels were maintained to offset the wet weather conditions.
Focus on export markets
The focus continues to be on regional and export markets to countries with better growth rates than Tanzania.
Production in April 2018 was hampered by wet weather but sufficient stocks of coal were maintained to meet customer demand.
There were 39,671 tonnes produced compared to 33,934 tonnes mined in April 2017.
A stockpile of 50,000 tonnes and an additional 11,000 tonnes of fully exposed coal were available at the end of the month.
Year-to-date production is 474,433 tonnes compared with 341,648 tonnes for the same period in 2017.
The crushing plant continues to perform well.
Chairman Graeme Robertson said: "it is pleasing to see production maintained through very wet periods and full credit must be given to our Tanzanian team.
“In terms of changes to the Mining Regulations in Tanzania, we believe Tancoal complies with all new regulations and we do not believe these will detrimentally affect our operations.”