“Gujarat NRE’s Australian Operations report Half yearly PAT of Rs. 120 Crores”
Kolkata, 29th November, 2010. The company has been receiving numerous requests from investors seeking to understand the impact on the half yearly profits of the company on a consolidated basis post declaration of the half yearly results of the Australian subsidiary last week. This more so in view of the growing impact of the Australian business in the working of Gujarat NRE Coke Limited (GNCL).
In this regard, we are pleased to advise that the stand alone profits of the company for the half year ended 30th Sept'10 has been Rs. 29.96 crores. On the other hand, Last week The Australian subsidiary of GNCL, Gujarat NRE Coking Coal Ltd wherein GNCL holds 77% stake; reported a net profit of A$ 29.4 million ( Rs 120.67 crores approx) for the half year ended Sep 2010 as compared to loss of $6.1 million (Rs 23.69 crores) for the half year ended 30th September 2009 . The same is being attributed to the fact that the Australian subsidiary has been successful in ramping its production to around 2 million tonnes per annum and simultaneously bring down its production cost and a robust coking coal price in the current FY. The positive effect of Australian results would be visible in the consolidated balance sheet of Gujarat NRE Coke Ltd. since it holds 77% stake therein.
The company is in the midst of mine development with further investments in excess of $ 350 million to increase production to 6 Million Tonnes per annum by 2014-15. Gujarat NRE is also happy to advise that during the last couple of months the company has been able to develop a market for the run of the mine production to alternate buyers. Gujarat NRE has been ramping up coking coal production rapidly in the Australian mines, surplus coal after sales to GNCL in India is now being sold to external customers. We have already sold a few shipments of unwashed coking coal to third party customers in China during the current quarter. With the expected ramp up in product and continued decrease in the production cost and the sustained coking coal price of $200 + per tonne, the profitability is expected to improve further in the coming years.
Speaking on the results Mr Arun Kumar Jagatramka said “GNCL holds controlling stake in the 2 Australian coking coal mines with a target production of 6 million tonnes of coking coal in 4 years time. The potential value thereof is several times the present net worth/market cap of GNCL and would get reflected over next few years. We do not believe in short term returns but rather believe in longer term growth of the company and creating much larger wealth for all stakeholders in the long term. This is in addition to the value that remains and continues to grow due to our dominant position in coke business. “
“From experience I can say that those investors who have patience and confidence in the company, did realise a gold mine in the form of GNCL in the last decade. I personally believe that decade to 2020 would see much higher investor returns than what we saw in the earlier decade, but this does not come without the current perceived pains that we are happy to endure and always look forward to having such investors who are prepared to be on this journey with us.”
Gujarat NRE Coke Limited is the largest merchant coke producer in India with capacities of around 1.3 million tonnes per annum. GNCL has also invested in clean energy by establishing 87.50 MW WTG.