The Calgary-based company earned $C20.1 million of net income, far below the $106.2 million of the previous year.
But it was a record sales year for GCC, with 1.77 million tonnes sold – a 67% increase on the 1.06Mt sold in the previous fiscal year. Sales in the fourth quarter were 430,000t versus 110,000t a year earlier.
The average coal sales price was $132/t, 44% down year-on-year.
The company noted the impact of the boom times for met coal, recording an average sales price of $118/t in the fourth quarter compared to $364/t in the comparable 2009 quarter.
GCC managed to react to the lower prices by reducing its average cost of sales by 16% over the year to $100/t.
The company said this was due to higher volumes as well as improved productivities and lower incurred costs for things such as equipment maintenance, diesel fuels and external services.
"Despite a challenging economic environment, we accomplished some significant milestones in fiscal 2010,” GCC president Robert Stan said.
“We achieved record sales and production volumes and secured approval to mine at the No. 8 pit, ensuring an additional 10-plus years of surface mining resources."
He added that GCC’s outlook on met coal demand in the next three years “continues to be robust” and would lead to higher prices and more price stability than the last three years.
"We continue to maintain a strong balance sheet and have the coal resources, a modern fleet of equipment and the operational expertise necessary to successfully execute our growth plans for the benefit of all stakeholders," Stan said.
Looking ahead, GCC expects its sales volumes for the fiscal 2011 year to be 2-2.2Mt, the majority of which is already contracted.
Stan said much of the volumes in the new fiscal year would be contracted under quarterly arrangements rather than annual, as traditionally negotiated.
“This change to shorter term pricing is consistent with other metallurgical coal suppliers and will create quarterly negotiations to establish contract sales prices,” he said.
“Contract price settlements for the first quarter of fiscal 2011 are approximately $US195 per tonne; however, the average selling price of metallurgical coal for the first quarter of fiscal 2011 is expected to be $US150-160 per tonne due to the shipment of lower priced carryover tonnage during April.”
GCC has increased its annual production outlook once again to 3.5Mt by the end of fiscal 2013 due to the development of the No. 8 pit surface operations as well as progress on licensing and permitting of two more mining areas.
