MC Mining Ltd on Friday reported its interim loss deteriorated, thanks to weaker international coal prices and swelling costs.
The Canberra, Australia-based developer of coal mines across South Africa said its pretax loss widened to $5.8 million for the first six months that ended December 31 from $264,000 a year earlier.
Administrative expenses, including employee costs, more than doubled to $9.7 million from $4.1 million. Employee costs and director fees surged due to the increase in the number of staff in readiness for its flagship Makhado project.
For the first half, revenue surged 80% to $25.2 million from $14.0 million, primarily due to strong sales volumes at Uitkomst Colliery and the restart of operations at Vale Aluwani Colliery.
However, robust revenue was offset by depressed coal prices. On average, API4 thermal coal prices slumped 58% to $112 per tonne from $265 per tonne.
MC Mining said it had started to assess various scenarios to facilitate an accelerated start of coal production at Makhado, subject to further funding, with no impact to the existing project plan.
The project has the potential to produce in excess of 800,000 tonnes per annum of steelmaking hard coking coal and over 600,000 tonnes of thermal coal.
It said it continued to progress Makhado, with the commencement of early works to secure the site and construction of a bridge across the Mutamba river along with water infrastructure for the processing plant.
Shares in MC Mining rose 5.3% to R 2.00 on Friday in Johannesburg. In London, they were untraded at 7.11p. In Sydney, the stock closed unchanged at A$0.15 on Friday.
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