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Exxaro mines big profits

Feb 22 2007 10:27

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Johannesburg - South Africa's Exxaro Resources posted 542 cents in basic headline earnings per share for 2006, and said on Thursday it would continue to benefit from strong commodity markets.

The 2006 earnings are not comparable to those of 2005 as Exxaro was listed in November after it was spun off from Kumba Resources and merged with unlisted Eyesizwe Coal to form the country's biggest diversified black-owned mining firm.

The coal, base metals, industrial minerals and iron ore producer expected headline EPS of between 450c to 550c for last year.

Exxaro reported revenue at R13.7bn for last year, an increase of 16%, while net operating profit was up by R598m to R4.34bn.

"The group is well positioned to benefit from the continued strong commodity markets and a currency at weaker levels," Exxaro said in a statement.

Buoyant demand for coal at good prices and a zinc price remaining high should have a positive impact on the operating results for these commodities, it added.

But a surplus in the supply of high-grade titanium feedstock will continue to affect the results of the mineral sands operations.

Zircon, which remains in short supply, and stable offtake of pigment from Exxaro Sands, Australia, will make a positive contribution to earnings, the company said.

Shares in Exxaro were down 3.4% at R67.60 at 10:18 from Wednesday's close of R70.

 
 
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