Queensland floods cause Macarthur Coal to lower profit guidance again
Macarthur Coal (ASX:MCC) has downgraded its profit guidance again as the flood crisis in Queensland continues to significantly impact mines in the state.
The company said today that based on preliminary results, it believes that net profit after tax (NPAT) for the first half of the 2011 financial year will be in the lower end of the guidance range provided to the market on December 16, 2010.
Macarthur downgraded its profit guidance last month, from previous guidance provided on October 27 of $115m to $125m.
"The range of $97 million to $102 million is based on forecast operating results and does not include the reversal of derivative liabilities or the gain on disposal that will eventuate as a result of the early exercise of the Middlemount option by Gloucester Coal Limited announced on December 24, 2010," the miner said.
According to Macarthur, record rainfall at Coppabella and Moorvale mines in December has continued to hamper coal mining and production.
But despite the heavy rain, the miner said coal sales for the six months to December 31 were 2.4 million tonnes, in line with guidance provided to the market in mid-December.
The Goonyella rail corridor has reopened and Macarthur Coal has been able to resume transporting coal to Dalrymple Bay Coal Terminal this week, however future railings will be dependent on coal availability, the miner said.
Macarthur Coal chief executive Nicole Hollows said the company has activated water management plans and is currently able to mine overburden at both sites.
"Coal is already being mined at Moorvale, but the sustained wet weather has slowed coal recovery at Coppabella. Dewatering of the pits at both sites is underway and we are aiming to have coal recovery progressively return to normal over the next few weeks."
"Once the pits are free of water, we'll have more coal exposed that can be processed and transported but it is not possible to predict when we will return to a steady state of mining as that largely depends on any future rain," Ms Hollows said.
Macarthur advised that the declaration of force majeure with customers remains in place.
On December 3, 2010, Macarthur Coal declared force majeure - a clause that allows them to breach supply contracts in extraordinary circumstances - to customers as a result of unseasonal heavy rain in the Bowen Basin.