Grange Resources posts AU$42.65 million net profit in FY 2009-10

Monday, 06 September 2010 12:08:15 (GMT+2)

Australia-based magnetite pellet producer Grange Resources has announced its results for the financial year 2009-2010 (FY 2009-10) ended on June 30, stating that the period saw the continuing transformation of Grange becoming a profitable organization with a strong balance sheet, no net debt and all of its products market priced.

Grange's net profit of AU$42.65 million (US$39.11 million) in FY 2009-10 was down 50.4 percent compared with a net profit of AU$86.05 million in FY 2008-09. When the same periods are compared, the company's sales revenues dropped 35.7 percent from AU$356.049 million to AU$229.07 million (US$210.07 million).

Sales volumes for the year ended June 30, 2010 were higher at 2.4 million mt of iron ore pellets, compared with 2.2 million mt for the year ended June 30, 2009. The reduction in revenues from mining operations arose principally from a 48.3 percent reduction in the benchmark iron ore pellet price to US$72.32/mt (from US$139.89/mt) in April 2009 and a contractual commitment to deliver 500,000 mt of iron ore pellets into a legacy supply contract at a price of US$43/mt.

With no net debt, costs at the operation significantly reduced and with all of its products now being priced at index-based market prices, Grange is extremely well positioned to leverage off the higher iron ore prices currently being experienced, the company said.

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