Raspadskaya Coal Company (Raspadskaya), the second largest coking coal producer in Russia and a subsidiary of domestic steelmaker Evraz Group, has announced that in H1 2010 it managed to increase its revenue to $466 million and its net profit to $228 million from $148 million and $360,000 in H1 2009 respectively, due to efficient production and sales operations, and higher sales prices. EBITDA rose to $259 million from $63 million a year earlier.
Accordingly, in H1 2010, Raspadskaya's cash cost of coal concentrate production was US$23.9/mt. The dynamics of the cost were affected mainly by a return of production expenses to pre-crisis levels and, starting May 2010, by a drop in production volumes following the accident at the Raspadskaya mine on the night of May 8-9.
"In H1 2010, we significantly increased volumes of sales to the Asian market (China, Republic of Korea) - their share in our total sales volumes was 23 percent. However, after the accident, we have focused on sales to Russian customers only - at present, we sell to eight Russian plants. In addition, we started selling coking coals of the K and KO (hard coking) grades from the Koksovaya mine acquired in April 2010. Based on H1 2010 results, the company maintains a level of liquidity sufficient to continue both its operation and reconstruction of the Raspadskaya mine," Raspadskaya CEO Gennady Kozovoy said.
According to preliminary estimations, the total expenditure on the reconstruction of the Raspadskaya mine will be about $280 million. However, according to Mr. Kozovoy, the pre-accident production levels at the mine will not be restored until 2012, but some operations there are planned to be restarted in the next quarter.