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Bundoora closure to hit Bounty earnings

UNDERGROUND mine contractor Bounty’s earnings are expected to take a hit in 2012 following a decision by its only customer, Anglo American, to place the Bundoora project in Queensland on care and maintenance.

Lou Caruana
Bundoora closure to hit Bounty earnings

Bundoora represented about 25% of anticipated revenues from the Anglo contract for FY2012.

Bounty reported an operational earnings before interest and tax of $1.09 million for the 2011 financial year compared with a $3.6 million loss in 2010. It spent $2.1 million in refurbishing and renewing its fleet of equipment compared with $1 million in 2010.

Some 88% of its revenue was derived from operations at Anglo’s Aquila mine. For the financial year 2012 to date, Bounty has derived 100% of its revenues from two Anglo operations.

“Subsequent to balance date, Bounty was notified by its client Anglo American that a portion of its contract, the Bundoora project, has been put on care and maintenance,” it said.

“Bounty had previously advised the market that under the contract with Anglo American, mining at Bundoora was due to commence in August 2011.

“With the decision to place the mine on care and maintenance, commencement of mining at Bundoora is now deferred indefinitely. It is expected that the period of deferral will extend beyond the period of the current contract which runs until July 2012.”

Bounty said it was exploring opportunities with Anglo American for future development work at the German Creek complex, which could in part replace the anticipated revenue.

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