SINGAPORE (Mar 1): Golden Energy and Resources (GEAR) has announced FY18 earnings of US$39.3 million ($53.2 million), down 37.5% from its FY17 earnings of US$67 million due to higher mining overheads, fuel costs, freight & stockpile expenses, as well as higher stripping ratios.
Revenue nonetheless grew 37.3% to a record US$1 billion for FY18, compared to US$763.8 million in the previous year.
The strong topline growth was achieved on the back of higher contributions from the Coal Mining division, where revenue surged 46.1% on-year to US$943.2 million due to higher sales volumes.
This helped to offset a marginally lower average selling price (ASP) for the division, which fell 2.6% to US$41.39 per tonne from $42.49 per tonne in the previous year.
Meanwhile, revenue from the Coal Trading division fell 9.1% to US$103.6 million from US$114 milion a year ago, due to a lower sales volume that was partially offset by higher ASP.
The non-coal business, which comprise mainly plywood sales, fell by US$2.7 million to US$1.7 million over the year, in the absence of log sales and lower management fee.
Cost of sales grew 53.3% to US$686.7 million from US$447.9 million a year ago.
This comes as a result of higher mining services costs due to higher stripping ratios and a longer overburden hauling distance; coal freight for increased usage of equipment for the transport of coal; mining overheads, fuel costs and royalty expenses.
Meanwhile, administrative expenses grew 39.6% to US77 million due to higher repair & maintenance expenses, employee-related expenses; taxes and stamp duty fees; and legal and professional fees incurred from corporate exercises.
As at end-2018, cash and cash equivalents stood at US$113.1 million compared to US$188 million a year ago.
The group expects to remain profitable going into FY19 as it believes demand for coal will continue to be supported by the construction of coal-fired power plants in ASEAN’s emerging economies.
“We are pleased that our revenue has achieved a significant milestone, crossing the US$1 billion mark for the first time amidst the challenges faced by the global coal mining industry, which was exacerbated by the ongoing US-China trade tensions,” comments Fuganto Widjaja, executive director and group CEO of GEAR.
Shares in the group closed 1 cent higher at 26 cents on Friday.
