News: Hargreaves confident despite market conditions
Mining and logistics firm Hargreaves Services, has seen profits fall in "unprecedented" market conditions and incurred losses associated with the discontinued operations at Maltby Colliery in Rotherham.
Reporting its financial results for the six months to November 30, revenues at the Durham group dropped 23.7% to £351.2m. Underlying pre-tax profit was down 28.8 per cent to £20.3m. Hargreaves said that it had faced a number of significant challenges arising from the well documented weakness in the coal price and turmoil in coal and coke markets.
The board of Hargreaves said that it was still confident in continuing overall profit and cash generation even through this difficult period.
The 500 acre colliery at Maltby was mined for over 100 years until geological conditions could not be overcome and underground operations ceased in 2013.
Regarding Maltby, the report said: "The loss of £1.1m for the period from discontinued operations largely related to costs incurred at Maltby Colliery as part of the overall restoration programme. As previously reported, the mine shafts have been filled and capped and the Group has now received formal certification that this has been completed.
"The process to sell the underground equipment continues; there have been a number of enquiries and a further £1.7m of realisations have been achieved during the period leaving a net residual book value to recover of £5m. The Group remains confident of achieving in excess of book value for the assets but notes that low commodity prices have further depressed the mining equipment markets."
The future restoration scheme is "subject to some uncertainty" as the underground workings came to a premature end. Hargreaves had planned to import 675,000 tonnes of mine runoff fines, known as MRF, from nearby Hatfield Colliery and deposited in the current lagoon at Maltby. MRF is a fine slurry-like material which is formed during the washing and reclamation of coal fines (tiny coal particles).
Up until the end of October 2014, a total of approximately 400,000 tonnes of MRF had already been deposited at Maltby but members of the planning board refused the planning application for the importation of material. After the decision was made in December, enforcement action was authorised, and the operators were ordered to stop importing MRF to the site. Hargreaves is appealing against enforcement action authorised by Rotherham Council.
The immediate future of the site is as Maltby Energy Park, with operator Alkane Energy generating energy from the coal mine methane assets for an estimated period of up to 15 years.
Egdon Resources, a leading player in shale gas exploration, recently acquired the interest in the current licence to explore for the controversial energy source at Maltby.
In the final draft of the borough's Sites and Policies document the majority of the 200 hectare site is earmarked to remain in the green belt. A pocket of development, which includes the pit yard, associated buildings and access, is not considered suitable for a business park with offices or industrial units but instead used for "for waste and energy activities."
Hargreaves website
Images: Hargreaves Logistics
Reporting its financial results for the six months to November 30, revenues at the Durham group dropped 23.7% to £351.2m. Underlying pre-tax profit was down 28.8 per cent to £20.3m. Hargreaves said that it had faced a number of significant challenges arising from the well documented weakness in the coal price and turmoil in coal and coke markets.
The board of Hargreaves said that it was still confident in continuing overall profit and cash generation even through this difficult period.
The 500 acre colliery at Maltby was mined for over 100 years until geological conditions could not be overcome and underground operations ceased in 2013.
Regarding Maltby, the report said: "The loss of £1.1m for the period from discontinued operations largely related to costs incurred at Maltby Colliery as part of the overall restoration programme. As previously reported, the mine shafts have been filled and capped and the Group has now received formal certification that this has been completed.
"The process to sell the underground equipment continues; there have been a number of enquiries and a further £1.7m of realisations have been achieved during the period leaving a net residual book value to recover of £5m. The Group remains confident of achieving in excess of book value for the assets but notes that low commodity prices have further depressed the mining equipment markets."
The future restoration scheme is "subject to some uncertainty" as the underground workings came to a premature end. Hargreaves had planned to import 675,000 tonnes of mine runoff fines, known as MRF, from nearby Hatfield Colliery and deposited in the current lagoon at Maltby. MRF is a fine slurry-like material which is formed during the washing and reclamation of coal fines (tiny coal particles).
Up until the end of October 2014, a total of approximately 400,000 tonnes of MRF had already been deposited at Maltby but members of the planning board refused the planning application for the importation of material. After the decision was made in December, enforcement action was authorised, and the operators were ordered to stop importing MRF to the site. Hargreaves is appealing against enforcement action authorised by Rotherham Council.
The immediate future of the site is as Maltby Energy Park, with operator Alkane Energy generating energy from the coal mine methane assets for an estimated period of up to 15 years.
Egdon Resources, a leading player in shale gas exploration, recently acquired the interest in the current licence to explore for the controversial energy source at Maltby.
In the final draft of the borough's Sites and Policies document the majority of the 200 hectare site is earmarked to remain in the green belt. A pocket of development, which includes the pit yard, associated buildings and access, is not considered suitable for a business park with offices or industrial units but instead used for "for waste and energy activities."
Hargreaves website
Images: Hargreaves Logistics
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