Thursday, 16 August 2012 | 11:00
Banpu Plc, Thailand's largest coal miner, expects to perform better in the second half than in the first due to higher production volume from its Australian and Indonesian coal mines.
Somruedee Chaimongkol, the chief financial officer, said production at the Sydney-based Centennial Coal will return to a normal 3.6 million tonnes in the third quarter after falling to 3.3 million tonnes in the second.
Indonesian coal output is projected at 7.2 million tonnes for the third quarter, up from 6.62 million tonnes in the second.
The Bharinto mine commenced production this quarter and is expected to produce 700,000 tonnes by year-end.
Normal annual capacity of the mine will be 4 million tonnes.
Banpu's total output will increase by 2 million tonnes to 44 million tonnes this year, rising to 45-46 million tonnes next year.
Australia's benchmark Newcastle price has rebounded by US$5 a tonne in the past two weeks to above $90 after falling to a low of $85-87, said Ms Somruedee.
She said prices are expected to edge up in the fourth quarter, but the year's average will be lower than last year's.
Banpu's net profit in the second quarter fell by 14% year-on-year and 2% by quarter to 2.73 billion baht.
Revenue in the quarter increased by 19% year-on-year to 29.6 billion baht, with coal sales accounting for 95% or 28.1 billion and the rest power and stream revenue. Coal sales rose by 11% to 9.93 million tonnes.
The average coal selling price was $90.35 a tonne for the quarter, up by 5% year-on-year.
The Indonesian price lost 3% year-on-year and 6% quarter on-quarter to $94.20 a tonne.
Indonesian coal generated 19.9 billion baht, with Australia contributing 8.2 billion and domestic coal 21 million.
Earnings per share stood at 10.06 baht, up from 1.63 baht in the same period last year.
Banpu is now forecasting consolidated annual coal output of 55 million tonnes by 2015, up by 11 million tonnes from this year.
Chief executive Chanin Vongkusolkit said Banpu has been through several economic downturns and faced many short-term setbacks.
"We have a strong component of power earnings and domestic coal sales that provides a degree of protection during periods of weak coal prices," he said.
In the first half, nearly a third of operating earnings came from the power business and domestic coal sales.
The remaining two-thirds came mainly from coal exports to large creditworthy industrial customers.
Mr Chanin said given the current market conditions, Banpu will cut costs and postpone some capital expenditures.
The weakening coal price has prompted Banpu to cut its capital expenditures for 2011-15 by 30% to $1.25 billion from nearly $1.75 billion.
BANPU shares closed yesterday on the Stock Exchange of Thailand at 470 baht, up 12 baht, in heavy trade worth 1.07 billion baht.
Source: Bangkok Post
