The 40% drop in earnings was largely attributed to the impact of the Australian dollar and European shutdowns.

The stand-out success was the performance of MIM’s coal operations, which include the 75% owned Oaky Creek and Newlands-Collinsville-Abbot Point mining operations in Queensland.

During the period earnings before interest, tax and abnormals (EBIT) increased to $94.7 million from $22.2 million previously. MIM said the results were boosted by higher production and sales and lower costs from the Queensland coal mines. MIM’s reported that cash costs have dropped from $33 per tonne for the half year to December 1999 to $30/t for the half year to December 2000.

Half-year EBIT for the 75% owned Oaky Creek complex rose to $50.9 million ($5 in 1999). Newlands-Collinsville-Abbot Point rose to $43.8 million ($17.2 million in 1999). MIM said EBIT for its coal operations was up because of increased production and sales, lower unit costs and a lower Australian dollar.

Despite three longwall moves at Oaky Creek and Newlands during the period, production remained strong. Coal sales, including inventory sales, from Collinsville were 57% higher than for the previous December half in response to increased demand. Sales of Oaky Creek coal increased 9% as production increased while sales of Newlands coal increased by 7% to meet strong demand, inventory being drawn down as production was limited by lower longwall output.

MIM said increased coal mine production to meet demand and increased productivity would lead to higher coal sales and lower unit production costs.

“A new fourth module at the Oaky Creek washplant will improve coal recoveries and allow for some additional production. In addition, the commitment to mining the southeast area of Oaky No 1 mine will ensure continuity of Oaky Creek production levels,” MIM said.

MIM is expecting strengthening coal prices and CEO, Vince Gauci said MIM was in a good position to take advantage of the strengthening market as the coal operations improved further.