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New UserNew Hope Profit Plunges 67% on Weak Coal Prices
25 Mar 2014
New Hope Corp.'s (NHC.AU) profit slumped in its fiscal first half as sharply lower coal prices hit earnings and the Australian mining company closed its New Oakleigh mine in eastern Australia.
New Hope on Tuesday reported a net profit of 22.7 million Australian dollars (US$20.7 million) for the six months through January, down from A$68.8 million in the year-earlier period.
Coal prices have plunged on a glut of raw material, as supply rises from mining operations in hubs like Australia and demand growth in Asia eases. Thermal-coal prices in Australia last week fell to around US$73 a metric ton--their lowest since late 2009.
New Hope also produced 11% less coal during the period, largely due to the scheduled closure of New Oakleigh in January 2013 as reserves at the site were depleted.
Still, in a show of confidence over its outlook, New Hope maintained its midyear dividend at 6 Australian cents a share.
Executives said the company was in a strong financial position, with cash and cash equivalents of A$1.1 billion at Jan. 31.
"The company remains well placed to navigate the challenges of the current global coal market and has maintained its strong balance sheet position, providing the capacity to take advantage of future growth opportunities," it said in its midyear report.
Source: http://online.wsj.com/