SINGAPORE (May 14): Geo Energy Resources reported 1Q18 earnings ended March fell 39% to US$8.98 million ($12.0 million) from US$14.6 million in 1Q17.
Revenue for the period fell 9% to US$90.5 million from US$99.3 million last year, bringing 1Q18 gross profit to US$21.9 million, 14% lower than US$25.3 million in 1Q17.
The decrease in revenue was mainly due to slightly lower volume sold during the quarter, as well as absence of sales from coal trading.
The group’s Sungai Danau Jaya (SDJ) mine sold about 1.94 million tonnes of coal of 4,200 GAR, lower than around 2.16 million sold last year. The lower tonnage of coal sold was caused by adverse weather conditions with 40% higher rainfall compared to the previous year.
The reduction of volume was partially offset by the increase of average index price.
Other income increased significantly to US$1.89 million from US$0.11 million a year ago, mainly due to the interest income earned on short term investments and deposits from undeployed cash.
However, finance costs surged to US$7.68 million compared to US$1.41 million in the previous year, mainly due to higher interest expense on the senior notes as compared to the medium term note that was redeemed on Oct 13, 2017.
As at Mar 31, the group’s cash and cash equivalents stood at US$242.9 million.
Tung Kum Hon. CEO of Geo Energy says, “With the expected commencement of TBR’s production in May 2018, we are on target for our coal production of 11-12 million tonnes in 2018 for SDJ and Tanah Bumbu Resources (TBR). We are optimistic in delivering stronger financial performance in 2018, drive further improvements in productivity and deliver stronger cash profits to enhance our shareholder returns going forward. Our aim is to become one of the top ten coal producers in Indonesia.”
Shares in Geo Energy closed at 22 cents on Monday.
