0% Wescoal shoots out lights
Marc Hasenfuss | Tue, 30 Jun 2009 18:59[miningmx.com] -- WHILE a number of junior coal mining projects are struggling for traction in a lower price environment, AltX-listed coal merchant, Wescoal, has shot the lights out in the year to end March 2009. Revenue rose 52% to R571m, while operating profits were up 47% to R25m More impressive, though, was that Wescoal’s operating cash flow quadrupled to R29m and trading margins rose from 9,1% last year to almost 10%. Wescoal CEO Andre Boje said the company’s sturdy trading margin was built around the coal merchant services offered to clients. "We give our clients what they want." He conceded that it was not easy to build the trading margin too far beyond the 10% mark by improving the company’s service offering. "To boost margins we will be looking at lowering our input costs at production level". Boje pointed out that Wescoal currently produced just 10% of total coal sold, but pointed out that the company’s ‘own production’ would be boosted by the recent acquisition of the Khanyisa Mine. He said if Wescoal could source 25% of its total coal sold from its own resources then the company could push up margins markedly. We’d then be making our mines’ margins." Boje said Khanyisa – a low cost producer of raw coal - would bring a new dimension to the group and would "undoubtedly reduce current input costs substantially." Despite the strong operational performance, Wescoal did not propose a dividend for the year to end March. The company has cash on hand of R57m – equivalent to around 44c/share. Boje said Wescoal’s decision last year to sit on its cash had proved prudent. "We saw tougher times coming and pulled back on our capital expenditure. That allowed us to take opportunities like those offered in Khanyisa."
USER COMMENTS () Click to View
COMMENT
SHARE
E-MAIL
PRINT
Most Read
Commented
Ed's Choice
- »AngloPlat turns the corner
by Brendan Ryan | 08 Feb 2010 17:07 - »AngloPlat to raise R12.5bn
by Brendan Ryan | 08 Feb 2010 09:49 - »ANCYL unveils nationalisation plan
by Miningmx reporter | 07 Feb 2010 12:59 - »Xstrata pays dividend, upbeat on markets
by Allan Seccombe | 08 Feb 2010 10:58 - »Harmony Gold output dips, profit up
by Allan Seccombe | 08 Feb 2010 08:44
- » Xstrata pays dividend, upbeat on markets
by Allan Seccombe | 08 Feb 2010 10:58 - » AngloPlat turns the corner
by Brendan Ryan | 08 Feb 2010 17:07 - » Copper prices destined for record high
by Allan Seccombe | 01 Feb 2010 14:29 - » Good prospects for gold
by Brendan Ryan | 01 Feb 2010 19:30 - » Bernard Swanepoel's first platinum play
by Allan Seccombe | 29 Jan 2010 16:43
- » ANCYL unveils nationalisation plan
by Miningmx reporter | 07 Feb 2010 12:59 - » Eskom calls for urgent coal investment
by Troye Lund | 28 Jan 2010 21:01 - » SA govt eyes shares in private miners
by Allan Seccombe | 02 Feb 2010 12:20 - » Bernard Swanepoel's first platinum play
by Allan Seccombe | 29 Jan 2010 16:43 - » AngloPlat turns the corner
by Brendan Ryan | 08 Feb 2010 17:07
More news from Energy
Multimedia
LATEST PODCAST | Nationalisation? Not in my life time
| 09 Feb 2010 -
› More 
The Miningmx team reflects on the week long Mining Indaba and the launch of the 2010 edition of Rain ...
Listen ›
RADIO WRAP | More ›
›
Chamber's proposal gives an "almost bearable" alternative - Dick Kruger, CoM |
›
Opportunities for growth in diamonds - Trans Hex CEO Delport |
The Miningmx team reflects on the week long Mining Indaba and the launch of the 2010 edition of Rain ...
Listen ›
Podcasts
RSS Feeds
Jobs
Events
JSE Listed stocksReal time resources data.
FREE News Alert! Subscribe to our News Alert