Berau delivers higher output despite weak price

By Ruli Setiawan

IDX-listed PT Berau Coal Energy Tbk mined 6.5 million tons of coal in the third quarter of this year, up by 7 percent compared to the corresponding period of last year, said London-listed Asia Resource Minerals plc (ARMS), which owns about 85 percent stake in the Indonesian coal firm.

ARMS said in a statement that coal mined in the first nine-month of this year increased by 6.2 percent to 18.6 million tons from the same period of last year, putting the company on track to meet full-year production target of 24.2 million tons, slightly up from 23.5 million tons last year.

Amir Sambodo, Chief Executive Officer of Asia Resource Minerals plc, said: "Despite the continued weakness in thermal coal markets, I am nonetheless pleased to be able to report a solid set of third quarter numbers. We continue to take action to reduce our cost base and remain confident that in overall terms our production cost of sales for the full year will be lower than 2013. At the same time, we remain on track to achieve our production target of 24.2mt."

The company added that while sales volume increased by 4.3 percent during the first nine months year-on-year, average selling price during the period was down by 8.3 percent to US$55.4 per ton.

International rating agencies such as Standard & Poor?s and Moody?s have recently downgraded the ratings of Berau and its subsidiary on bleak financial outlook amid the lingering downturn in the global coal market and price.

Operating Data	9 months to 30 Sept 2014	9 months to 30 Sept 2013	Year to 31 Dec 2013	YTD Q3 14 vs YTD Q3 13
Coal mined (millions of tonnes)	18.6	17.5	23.5	6.2%
Sales (millions of tonnes)	18.2	17.5	23.3	4.3%
FOB average selling price ($/t)	55.4	60.4	59.6	(8.3%)
Production cost of sales ($/t)	37.0	38.1	38.6	(2.8%)
Stripping ratio (bcm/t)[1]	8.7	8.8	8.8	(1.6%)

Editing by Reiner Simanjuntak