Newstan’s poor performance knocked $47.8 million from Centennial’s full year results and brought down investors’ earnings per share to A6c, compared to A11.7c in 2004/05.
During the year the company achieved record annual production of 15.6 million tonnes with sales of 15.2Mt. Annual raw production under management totalled 17.7Mt.
Despite troubles at Newstan it wasn’t all gloom and doom, with the company’s Tahmoor mine performing well, record profits from the Clarence and Charbon bord and pillar operations and the new Mandalong longwall continuing to achieve new production records.
Production and development records were also achieved at the Angus Place and Springvale longwall mines.
Capital expenditure during the year totalled $213 million, spent on the completion of the Mandalong coal clearance system to Delta Electricity’s Vales Point Power Station; a new armoured face conveyor, main and tailgate drives and a new beam stage loader at Newstan; and a rubber-tyre transport fleet at Angus Place.
Springvale received a coal clearance system upgrade, a beam stage loader replacement, a new crusher, and longwall face electro-hydraulics, setting the mine up for higher production from its longer and wider longwall panels.
Centennial also continued spending on land acquisitions and environmental assessment works at the 10Mtpa Anvil Hill Project in anticipation of mining expected to begin in 2008.
Thermal coal export prices for 2006-07 have been renewed at similar levels to 2005-06 and after shaking off coking coal “carry-over” tonnage from Tahmoor, Centennial will now enjoy higher coking coal prices.
“Although the group’s sales mix benefited from the addition of hard coking coal from Tahmoor, acquired in April 2005, the legacy of Austral’s previous operational problems constrained revenue growth with an average coking coal price received of sub-$US90 per tonne compared to an FY2006 benchmark of $US125 per tonne,” Centennial said.
“Fortunately, this low priced carry-over tonnage has now been delivered and the Group will now enjoy market prices for its hard coking coal, a significant increase on carry-over prices.”
Centennial was trading at $3.34 mid-morning.