WCC’s net income was $C47.6 million for the March quarter and $214.5 million for the year.
Year-on-year, the annual result was a significant jump from the 2008 loss of $106 million.
Big gains were made in December quarter income, at $58.8 million versus a $15.2 million loss in the same period the previous year.
The company cited higher prices in its current coal year contracts along with a favourable foreign exchange rate for the increase, which helped bring in coal sales of $111.7 million during the December quarter –a 48% rise year-on-year.
Prices also took the edge off falling coal shipments; WCC transported 346,000 tonnes in the March quarter, 60% less than the December quarter.
The average realised price in the last period was $316/t, a 263% spike.
The company said order deferments and lower production both contributed to the shipment reduction.
“The fortunes of the company have greatly improved with the record coal prices in fiscal 2009,” WCC president John Hogg said.
“We now expect to sell approximately 2.2 million tonnes of metallurgical coal, which is up from our previous guidance of 2Mt for fiscal 2010.
“Our stronger balance sheet has also allowed us to grow the company with the recent acquisition of our largest shareholder, Cambrian Mining, [and] allows us to grow, strengthen and diversify our business to be even better positioned when market conditions improve.”
The upcoming takeover of Cambrian was a hot topic in WCC’s financial review last week, as shareholders voted in favour of the transaction on June 24. The two companies expect the deal to close on July 13.
“The acquisition adds immediate value through the creation of a larger, stronger and more diversified coal mining company. The new Western will have globally diversified operations in three key coal-producing regions, product diversification with the inclusion of thermal coal, a more globally balanced sales program, an expansion of coal reserves and resources by 39 per cent and 50 per cent, a 100 per cent increase to current year coal production, significant cost savings, and will simplify the company's corporate structure,” WCC said.
The producer has secured further coal sales, saying its current fiscal 2010 coal production is completely under contract, with the buyers being international steel producers.
For the year, coal prices are approximately $US126/t for hard coking coal and $90/t for ultra-low volatile pulverised coal injection coal.
WCC also will gain from carryover tonnages, with average prices expected to be between $US120 and $125/t for both hard coking and ULV-PCI product.
The Canadian producer also issued production guidance of 1.8Mt of metallurgical coal from its two operating mines.
Wolverine is anticipating a total 1.2Mt in hard coking coal and Brule has a ULV-PCI target of about 600,000t.
