Managing director and CEO Ken Talbot said the 2006 outcome was largely attributable to the increased pulverised coal injection (PCI) coal price during the period, along with the decision to develop the Moorvale Mine prior to the mining boom and the success of growth initiatives such as increasing ownership in the Coppabella Mine.
Following the results, a final dividend of 18c per share was declared, which takes the total annual dividend to 41c per share fully franked.
EBITDA was $227.6 million, an increase of $117.2 million on the corresponding period last year, and revenue from coal sales totalled $534.8 million for the period, up 44.5%.
The company said the record revenues were achieved despite the softening of demand for coal in late 2005, the 30% sales price decrease for PCI coal for the contract year to March 31, 2007 and the recent competition and infrastructure limitations.
“Macarthur Coal is now in a very healthy financial position with large cash flows from operations and no bank debt,” Talbot said.
“We also remain focused on high growth sectors of the coal market where there is continuing strong demand for coal.”
Talbot said the company was well placed to fund its growth program and had a strong project pipeline, comprising 11 exploration prospects including three coking coal prospects.
“Our challenge is to develop these projects in a staged program in line with the additional port entitlements becoming available from late 2007 and in late 2008 after the upgrades to the Dalrymple Bay Coal Terminal. Our allocation will increase from 4.5 million tonnes per annum to 8.8Mtpa by the time Phase 2 is completed.”
However, Talbot said there would be some challenges to face in the future.
“The selling price has reduced and the cost base is increasing. In order to remain profitable and competitive we must be innovative and work to reduce our costs.”
Macarthur Coal currently holds 73.3% of the Coppabella and Moorvale mines in Queensland.
The company’s operations produce approximately 47% of the low volatile PCI coal exported from Australia.
