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Junior coal miner MC Mining said its revenue almost doubled in its year to end June, helped by a new marketing deal which gave it access to the more lucrative global market.
Revenue for the period increased by 91% to $44.8 million (R884 million) and the loss after tax fell 79% to $4.4 million, the group said in an update, even though the Uitkomst Colliery in KwaZulu-Natal produced 5% less coal, or 444 984 tonnes.
A marketing agreement with Overlooked Collieries resulted in net revenue per tonne increasing to $142 from a $104, the group said.
The miner, which is valued at R890 million on the JSE, fared well in 2022, jumping in September when it announced that it was getting a long-awaited A$40 million (R461 million) rights issue under way. While focused on SA, MC Mining is incorporated in Australia, where it is listed on the ASX, while also being listed in London, as well as the JSE.
MC Mining owns 70% of the Uitkomst colliery, which produces metallurgical coal, but much of its focus is on its flagship Makhado project in Limpopo, which will produce coking coal and thermal coal for export and domestic use. In December, it also restarted production at the Vele Colliery in Limpopo - which was mothballed in 2013 - and is ramping up production, targeting a monthly 60 000 tonnes of thermal coal.
The Makhado steelmaking hard coking coal project has the required regulatory approvals and surface rights over the mining and processing areas and is "shovel ready," the group said, and an optimisation study was completed by independent experts, resulting in the annual capacity increasing from 3.2 million tonnes per annum to 4 million. Construction is expected to take 18 months and it has begun early works, including for electricity supply infrastructure. Peak funding required is estimated at R1.8 billion.
"MC Mining made pleasing progress during [financial year] 2023 including the completion of the A$40 million rights issue, the recommencement of operations at the Vele Colliery and the detailed planning for the construction of the Makhado Project," CEO Godfrey Gomwe said in a statement.
"The company’s directors approved expenditure of R71.3 million on early works at Makhado and this commenced during the period while the funding initiatives for the balance of the capital required continued and are expected to be finalised in the [second half of] 2023."
Shares in the group fell almost 1% in early afternoon trade on Thursday.
