Czech coal producer NWR cautious on short-term outlook

Central Europe's leading coking coal producer, Czech-based New World Resources N.V. (NWR), has announced that in the first half of 2011 it saw a 24 percent decrease in its net profit to €87 million (US$125.5 million) compared to the same period of 2010, while its revenues grew by 17 percent year on year to €840 million (US$1.2 billion).
 
NWR's earnings before interest, taxes, depreciation, and amortization (EBITDA) from continuing operations of €250 million for the first six months of the current year was 48 percent higher than in the previous year due to increased revenues, mainly on the back of higher realized prices for coking coal and coke in the given period.
 
Producing 5.8 million mt of coal in the first half of 2011, NWR expects to produce approximately 11 million mt of coal in 2011. According to the company statement, NWR is being cautious on the short-term outlook given recent market turmoil and the uncertain macroeconomic environment, especially in Europe. Although no concrete evidence of a slowdown is seen in the regional market to date, the NWR believes that there is a risk of near-term volatility in prices and 2012 volumes. While monitoring the markets closely, NWR remains optimistic about the long-term outlook for the region.