Geo Energy reports 76.4% drop in revenue amid coal slump
Friday, November 14 2014 - 01:08 AM WIB
SGX-listed Geo Energy Resources Ltd, an Indonesian coal mining specialist, said Thursday that revenue from coal production, coal trading, mining services and equipment rental dropped by 76.4 percent to US$8.2 million in the third quarter (3Q) ended September 30 of this year from $34.8 million in the corresponding period of last year.
The company said that this was mainly due to the downward trend in coal price and soft demand for coal with calorific value, which resulted in a reduction of coal revenue by $20.7 million; and decrease in revenue of $5.9 million from mining services and equipment rental.
?Our cost of sales decreased accordingly by $12.1 million from $25.7 million in 3Q2013 to $13.6 million in 3Q2014. The decrease in cost was less than proportionate as compared to the decrease in revenue, mainly due to the decrease in coal production volume as well as other non-recurring operational costs to streamline manpower and reallocate our capacity utilization,? Geo Energy said in a statement.
The company said gross profit decreased from $9.1 million profit in the third quarter of last year to a loss of $5.4 million in the same quarter of this year.
Geo Energy Group, which was established in 2008 and is headquartered in Singapore, currently owns PT Bumi Enggang Khatulistiwa (BEK), the Mining Business License (IUP) owner of a 4,570 hectare coal mining concession area in Kutai Barat, East Kalimantan, and subsidiary companies that are responsible for mining, as well as heavy equipment and machinery procurement and rental.
Editing by Reiner Simanjuntak