New Hope profit up 30%, coal price firm

Coal miner New Hope Corp Ltd has posted a 30 per cent rise in net profit and says while cost pressure continues, thermal coal prices are staying firm.

For the year to July, New Hope made a net profit of $68.7 million, compared to $53.1 million for the previous year.

“Regarding outlook, New Hope notes that, while cost pressures continue, thermal coal prices have remained firm and the majority of its contracts are fixed at acceptable US dollar price levels for 2006/2007,” the company said.

New Hope said its Australian coal operations were at full capacity over 2005/06, with sales up nine per cent to 3.77 million tonnes, with improved prices offsetting higher operating costs.

New Hope, which is majority owned by investment house Washington H Soul Pattinson and Co Ltd, has coal mining operations in south east Queensland, coal handling in Brisbane and exploration in Central Queensland and the Darling Downs.

The company warned that its Ipswich mines are nearing the end of their economic lives, with New Oakleigh to continue till 2009 while Jeebropilly will close in January 2007, leading to a loss of 500,000 tonnes in annual capacity.

“This will be offset by the New Acland Stage 2 mine expansion, which is due for completion in April 2007 and takes capacity of up to 4 million tonnes a year, but the changeover will mean a slight decrease in annual coal production in 2007 compared with 2006,” the company said.

“The New Acland mine could initiate a Stage 3 expansion, taking total coal production to 8.7 million tonnes by end 2010, if the nearby Tarong Power Station takes up an option by June 30, 2007 for the supply by New Hope of 5.7 million tonnes of coal per annum for up to 25 years.”

At 1012 AEST, New Hope shares were up four cents to $1.31.

© 2006 AAP