Australian coal miner Caledon Resources announced its first operating profit and strengthened its working capital position, although all attention remains on the progress of takeover talks. The company has been in discussions with several potential buyers and one has provided a "non-binding, conditional written indication of interest at a level significantly in excess of the current market price". RBC Capital Markets has been engaged to widen the search for potential buyers.
Despite a strong second half of the year, the worsening global economic crisis forced Caledon to revise its 2009 sales target down from 900,000 tonnes to a minimum of 400,000 tonnes of coal from its Cook operations, which has necessitated a 31 per cent reduction in the workforce. Staff numbers will fall to 143 compared with 208 in late 2008 when Cook was gearing up for increased output.
Unit costs in the year were A$178 (£80) per tonne, a 21 per cent saving from 2007 which was achieved through increased productivity and lower mining costs. Caledon raised A$20.2m at A$1.10 (52p) a share in June through a secondary listing in Australia and applied part of these funds to the final payment for the Minyango project, the company's larger, longer-term coal project.
Broker Arbuthnot Securities expects 2009 pre-tax profit of around A$10.4m with EPS of 3.6¢.
| CALEDON RESOURCES (CDN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 17p | MARKET VALUE: | £34.9m | |
| TOUCH: | 16-17p | 12-MONTH HIGH: | 156p | LOW: 7p |
| DIVIDEND YIELD: | nil | PE RATIO: | 9 | |
| NET ASSET VALUE: | 67¢* | NET CASH: | A$6.87m | |
| Year to 31 Dec | Turnover (A$m) | Pre-tax profit (A$m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 15 | -44.9 | -23.0 | nil |
| 2008 | 122 | 9.0 | 4.3 | nil |
| % change | +701 | - | - | - |
*Includes intangible assets of A$43.2m, or 21¢ a share £1=A$2.235 | ||||
