Wednesday, June 22, 2011

News: Production improves at Maltby Colliery


New working practices at Maltby Colliery have resulted in an improved production consistency at Rotherham's last remaining colliery.

In a trading update, operators Hargreaves Services announced that results are expected to be in line with management expectations and the board remain confident about the prospects for the group.

The new working practices at Maltby, announced in February, were successfully introduced in April and although only recently implemented, production consistency has improved. The company acknowledged the efforts made by staff and management to facilitate the changes.

Last year, Hargreaves completed the change to a new face at Maltby but the performance had been a disappointment despite the investment. In December the group stated that underground production had improved following the slow start to the year.

In February, Hargreaves stated that the major equipment issues were resolved and a fifth shift was introduced employing 70 extra miners. This increased cutting time by 30% from 108 to 141 hours.

Net debt at the end of May was £66m, slightly lower than management expectations.

Working capital levels at the end of May were well below management expectations in volume terms, having benefited from close management in both the UK and Europe.

Although stocks were below management expectations in volume terms, the company benefited from commodity prices remaining strong and almost 30% higher in May 2011 compared to twelve months earlier.

Although the profit and loss account tax charge for the year is expected to be in line with management expectations, the group benefited from a one off reduction in cash tax payments of £7m in the second half. An additional smaller cash benefit is expected in the six months ending 30 November 2011.

Hargreaves Services website



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