Kumba Iron Ore shows its maiden

Kumba Iron Ore, which listed late in 2006, has reported earnings per share of 84 cents for its first two months of existence to end-December.

The company has also reported a R153 million expense arising from its sale of equity to the Sishen Iron Ore Company community trust, following the split of Kumba Resources last year.

The company says that for the entire year of 2006, year-on-year revenues increased by 32 percent from R6.6 billion to R8.7 billion last year, due to the hefty contract price increase last April. During December a 9.5 percent annual increase was announced.

Export sales were 3 percent lower in the year at 21.5 million tons (4mt for two months), following the ship loader failure announced earlier in the year at the Saldanha port. Production at the Sishen mine and tonnage railed were both 1 percent higher at 28.7 million tons and 24.3 million tons respectively.

Domestically, the company says Mittal Steel’s lower demand resulted in a 9 percent decrease in local sales to 8.3 million tons (1.6mt for two months).

Costs were higher in the year, according to the results statement, due to higher fuel, human resource and project-linked operating costs as well as higher stripping and maintenance related activities.

Earnings before interest and tax, otherwise known as operating profit, were up from R3.9 billion to R5.4 billion (R684m for two months).

Cash from operating activities increased from R2.6 billion to R4.3 billion over the 12 month period, with R389 million generated in the final two month period.

Source: I-Net Bridge