In its preliminary final report, the Perth-based miner said the net loss was due to a combination of factors including lower than anticipated production at its Tritton copper mine in New South Wales and the declaring of force majeure at its Sebuku coal mines in Indonesia as a result of flooding.
Straits’ bottom line was also hampered by the negative impact of historical copper hedging at Tritton and an appreciating Australian dollar against the US dollar.
Despite the loss, the group’s net asset position at the end of December 2007 was $901 million, a 107% increase over December 2006, after Straits purchased the Jemayan coal mine in Indonesia late last year and raised $140 million in October.
“While the financial result for 2007 is disappointing, the company is extremely well positioned for the future,” Straits chief executive Milan Jerkovic said.
“The coal mines in Indonesia and the Tritton copper mine in NSW are undergoing significant production increases over the next 12 months, in addition to the Hillgrove gold-antimony mine which is currently being commissioned.”
Jerkovic added the group’s coal production had been substantially boosted by the purchase of the Jembayan coal mine and coal projects in Madagascar and Brunei.
“In the year ahead we look forward to expanding and proving up the resource base at Jembayan to JORC standard and the drill out and feasibility study of the Sakoa coal project in Madagascar,” he said.
“Besides these developments, Straits is also advancing the sulphide project expansion at Whim Creek and the Yannarie Solar salt project near Exmouth, as well as an extensive portfolio of attractive exploration targets.”
Shares in Straits closed the day 5c lower at $7.65.
