ATH14 Jun 2011 08:46
Commenting on the Interim Results, Alistair Black, Chief Executive of ATH, said: "Despite the challenges faced by the Group from rising gas oil prices and unexpected geological conditions at Glenmuckloch, underlying profit for the first six months was some £2 million better than the previous year at £1.7 million (2010: loss £0.3 million). With the Netherton site now fully developed the Board had expected a typically strong second half performance, however, current mining conditions at Muir Dean and the presence of heat affected coal at Netherton suggest volumes will now be lower than expected for the full year. In view of the above, the Board has decided to concentrate its mining effort on accessing higher quality, lower ratio coal. This has necessitated the write-off of a significant part of its work in progress balance and a reduced expectation for the year. The Group expects that the impact on sales volumes will be increasingly offset by improved selling prices as we move forward and, consequently, the Board remains confident in the medium and long term prospects for the business."
"We are still on track to fulfill the first of the Group's fixed price legacy contracts, which continue to restrict earnings, and look forward to further significant improvements to average selling prices once they have been completed."