Coal news and updates

Transnet earnings gain on higher volumes of coal, iron ore

Transnet, South Africa’s state-owned rail and ports operator, said full-year profit gained 8.2% as the company transported more coal, iron ore and manganese.

Earnings before interest, taxes, depreciation and amortization increased to R25.6 billion ($2 billion) in the 12 months through March, Acting Chief Executive Officer Siyabonga Gama said in Johannesburg on Tuesday. Revenue advanced 8% to R61.2 billion.

“The increase in revenue of Transnet is largely driven by volume growth,” Gama told reporters. South Africa is the continent’s biggest supplier of coal and iron ore, and the world’s largest producer of manganese.

Transnet is in the third year of a seven-year, R336 billion, plan to upgrade South Africa’s rail and port capacity and ease the export of raw materials. The company last year placed orders for 1 064 new diesel and electric locomotives, and unveiled agreements for R13-billion of financing toward the purchases in March.

The company announced a $2.5 billion loan from China Development Corp. and a R2.8 billion loan from Germany’s KfW Development Bank last month.

Transnet may raise a further R2 billion in the current fiscal year, either from capital markets or banks, and is confident about access to finance for the remaining years of the program, Gama said. Borrowings reached R110 billion last year, compared with R90 billion in the previous 12 month period.

Coal volumes by rail rose 9% in the fiscal year, while iron ore and manganese volumes increased 11%, Gama said.

The executive took over in April from CEO Brian Molefe, who was moved to power utility Eskom to help tackle supply shortages and a cash flow gap. He isn’t aware of an agreement to take his tenure beyond this month, Gama said.

source: http://www.moneyweb.co.za