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Johannesburg - Wescoal Holdings Limited [JSE:WSL] turned in a solid performance for the six months ended September 30, but the junior miner is gearing up to further improve margins and profitability further.
"We are delighted with the results," CEO Andre Russel Bojé told Fin24 in a video interview.
Wescoal announced an increase of 92.8% in revenue to R897.8m compared to R465.7m in 2013. It also lifted headline earnings per share (Heps) by 33.3% to 15.2 cents (2013 11.4 cents). Operational EBITDA grew to R84.3m against R48.7m for the same interim period last year.
Bojé said that the results back the group's decision to acquire MacPhail in October 2013.
"It clearly shows that our strategy of buying MacPhail was correct."
“This acquisition has breathed new life into the trading division and places the Wescoal group in the unique position of having a sophisticated trading division servicing the domestic market together with a mining division," he said in a statement.
Bojé said the group is positive about the future.
"We are focusing on repeating the first half's results for the second half. We are getting very close to that. We believe the incorporation of the Muhanga plant, where we are beginning operations ... can contribute to us getting very close to that result."
"On receipt of the water use licence we will begin the commissioning of Elandspruit. It should not contribute too much this year, but going forward, it is a game changer.
"It allows us to get to our stated target of 4 million tonnes by 2016 and there is a lot of excitement about that," said Bojé.
Watch: Wescoal revenue jumps to R897m
He also said the Muhanga plant, which was acquired as part of the Elandspruit project, starting production based on the excess Run of Mine (ROM) purchased outside of the industry.
"That product will be beneficiated at Muhanga and on sold to the current customer base of Muhanga." Bojé said this will contribute to revenues and margins for the mining division for this financial year.
Looking forward, he said: "I think we are in a very unique position in that we now have a substantial trading division that can leverage this critical mass to improve margins and profitability".
- Fin24
