Record profit despite lowered output

Centennial Coal has achieved a record net profit for the 2009 financial year in spite of lower production.

Centennial Coal has achieved a record net profit after tax of $82 million for the 2009 financial year.

This was on the back of a 36% increase in coal exports with total sales revenues rising to $886 million, a jump of 16% from the previous financial year’s revenue of $764 million.

However, it was unable to take full advantage of the high export coal prices seen through August and September 2008 as Centennial had previously entered into coal swap agreements some years earlier.

These agreements, which were designed to protect its Charbon operations, cost the company approximately $72 million.

Centennial will see the last of these coal swap agreements maturing by December 2009.

Centennial’s equity share of coal production was 15 million tonnes, down 8% from the previous year’s output of 16.85 million tonnes.

The company also saw a loss at its Mannering and Myuna operations.

Added to this was the suspension of longwall operations at Newstan. The earlier than planned suspension of Newstan resulted in a reduction of $23 million in revenues as well as a pre-tax operating loss of more than $16 million.

Centennial said it expects slightly higher production in 2010 than achieved this financial year through increasing output at its Mandalong mine and a return to normal production at Angus Place.

It is forecasting a projected 25% increase in export shipments for the coming year.

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