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Johannesburg - Wescoal Holdings [JSE:WSL] has returned to
profitability in the year ended March 2012, with headline earnings per share
from continuing operations of 11.4 cents, after a 8.1 cents loss a year ago.
Revenue was up 13.1% to R630.8m and operating profit came in
at R26m after an operating loss of R21.4m a year ago. EBITDA increased from a
loss of R6.2m to a profit of R45.3m.
No dividend was declared.
The results reflect the final sale of the Blesboklaagte
beneficiation plant in the discontinued results of the group.
An after tax profit of R2.9m was made on the sale of the
plant and substantial rehabilitation work was done on the Witbank site and recouped
from the proceeds of the sale.
Continuing operations within the group, which include coal
mining, processing and trading, reflected a 13.1% growth in revenue of R73.1m.
The mining division achieved revenues of R291m and Ebitda of
R47.2m from a total of 1.52 million tonnes of coal, while the trading division
revenues grew by 13.2% generating Ebitda of R7.0m.
Management said it is confident of strong growth going
forward and is focused on maximising profitability of the divisions.
The mining division’s focus on supplying Eskom with quality
product and disposing of all other associated operations was proving to be a
valid strategy, the company said.
“Deliveries to Eskom continue unabated however negotiations
are at an advanced stage to secure a three year contract to include the
Vlakvarkfontein resource,” the company added.
In the Trading division, Transnet Freight Rail (TFR)
railings to Richards Bay Coal Terminal (RBCT) for the calendar year to April
2012 totalled 23.8 million tonnes - an annualised rate of 71.5 million tonnes.
The increase on the 2011 calendar year of 5.8 million tonnes was primarily
being taken from domestic coal supply resulting in shortages of sized coal for
the domestic market.
Despite export prices decreasing to as low as $82, the
railings continue and domestic prices have increased with demand remaining
strong. Management believes the trading environment will show significant
improvement in the next financial year.
Looking ahead, the group said it was expected that the
trading division would continue to experience strong demand and with the large
producers' focus on export, restricted supply would continue.
The mining division would continue at maximum production and
with Vlakvarkfontein coming on stream later in the year, increased
profitability was forecast going forward.
Overall management expects strong growth in both divisions for the year ending March 2013 with the Vlakvarkfontein resource contributing substantially from there on.
