|Revenue||R2.1bn||(HY19: R R2.1bn)|
|Gross profit||R195m||(HY19: R R276m)|
|Total comprehensive income||R51m||(HY19: R108m)|
|Operating costs||R184m||(HY19: R104m)|
|Headline loss per share||-11.9cps||(HY19: HEPS 23.5cps)|
|Cash generation||R126m||(HY19: R291m)|
|Gearing ratio||36%||(HY19: 18%)|
Johannesburg, 26 November 2019 – JSE coal group, Wescoal Holdings, today reported results for the six months to September 2019. Contract mining production challenges and an increasingly competitive domestic coal market had a cumulative negative impact on the group’s performance. Major production improvement initiatives are underway at all operations to meet the group’s strategic objectives of stability, sustainability and scalability, supported by bolstered operational skills at all levels.
CEO Reginald Demana says: ‘’Wescoal’s long-term aim is to be a leading provider of reliable energy source. Our key strategic objective is to stabilise our operations, then optimise our performance, and ultimately scale-up through primarily organic opportunities. We will prudently manage costs and operational efficiencies to maximise returns from our current operations, and grow the business by exploiting the resources within our portfolio in a disciplined approach.”
Wescoal recorded revenue on a par with the prior year at R2.1 billion. Gross profit decreased to R195 million (HY19: R276 million), which is attributable mainly to the lower production levels.
Arnot and Moabsvelden are key developmental and growth projects funded from existing capital with an upside potential to bolster coal production output.
Looking ahead, Demana explains that Wescoal management aims to stabilise operations for efficiency in both its Mining and Trading divisions in the medium-term and the company is optimistic that this will be achieved by the end of FY20.