Geo Energy revenue drops by 82.5%
Thursday, May 14 2015 - 01:58 AM WIB
SGX-listed integrated coal mining group Geo Energy Resources Ltd said that revenue in the first quarter of this year dropped by 82.5 percent to US$2.9 million from $16.6 million in the corresponding period of last year.
?This was mainly due to the weak coal price and soft demand for mining services which resulted in a decrease in coal revenue of US$7.4 million and mining services revenue of US$6.3 million,? the company said in a statement Wednesday.
Geo Energy explained that in light of the current coal market situation, this contributed to the temporary halt of its PT Bumi Enggang Khatulistiwa (BEK) operation since the last quarter, marginal coal trading activities and a decrease in demand for mining services in the first quarter of this year.
It said that cost of sales decreased by $10.7 million, from $14.5 million in 1Q2014 to $3.8 million in 1Q2015. The decrease in cost of sales is generally in line with the decrease in revenue. ?Our group incurred a gross loss of $0.9 million in 1Q2015, which was mainly due to higher cost of production for mining services caused by unfavorable weather conditions hampering our mining operations,? the statement said.
Geo Energy currently owns 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