News Column

New World Resources Says First-Half Loss To Be Lower, Revenue Down

July 30, 2014

Rowena Harris-Doughty

LONDON (Alliance News) - New World Resources PLC Wednesday said its pretax loss in the first half of the year will be lower than the previous year, when it booked a hefty impairment charge, but said revenue in the period declined on the back of lower sales volumes and reduced average sale prices of coking coal.

In a trading statement, the European mining company said its pretax loss in the six months to June 30 has been significantly reduced due to a EUR307 million impairment charge it booked in the same period a year earlier and a reduction in depreciation charge.

Earlier this year, the group said its cost of sales fell in the first quarter, as part of its ongoing cost-containment plan which was started in spring 2013 and included lower energy consumption, reduction in headcount of staff, lower levels of development work, and lower depreciation after the impairment charge in the 2013 figures.

However, the company also noted that revenues fell 18% in the first quarter, as its average realised prices for coking coal fell 12% and its thermal coal prices fell 6%.

New World Resources said Wednesday that the first-half of the year as a whole shows a similar trend to that experienced in the first part of the year.

"The first six months of 2014 show a similar trend as already reported in the first three months of 2014: decrease in revenues, year on year, attributable to lower sales volumes and reduced average sales price of coking coal," the company said.

The group said that as at June 30 it held cash and cash equivalents of EUR122 million and had indebtedness of EUR811 million, of which EUR48 million is contractually repayable in the next 12 months.

"With respect to financial position of the group as at 30 June 2014, total assets have decreased mainly due to decrease in cash and cash equivalents, following cash outflow from both operating and investing activities," it said.

The group said it will announce its first-half results on August 21.

New World Resources shares closed Wednesday 4.6% lower. The company released the statement after the market close.

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Source: Alliance News

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