SouthGobi Resources Q3 Profit More Than Doubles
(RTTNews) - Coal mining company SouthGobi Resources Ltd. (SGQ.TO: News ) Wednesday reported net income for the third quarter of $55.9 million or $0.31 per basic share, rising from $27.5 million or $0.15 per basic share in the year-ago quarter.
On average, 4 analysts polled by Thomson Reuters expected earnings of $0.02 per share for the quarter. Analysts' estimates typically exclude special items.
On a diluted basis, loss for the quarter was $0.02 per share, narrower than the loss of $0.08 per share in the year-ago quarter.
The net income in the quarter was due primarily to the $62.1 million gain on the fair value change of the embedded derivatives in the China Investment Corporation convertible debenture. This compares to a gain of $49.8 million in the third quarter of 2010 on the fair value change of the embedded derivatives in the CIC convertible debenture.
Net loss excluding specified items for the quarter narrowed to $3.8 million from loss of $23.6 million last year.
The company's income from mine operations is composed of revenue and cost of sales and relates solely to the Mongolian Coal Division. Income from mine operations for the quarter increased to a record level of $20.6 million compared to a loss from mine operations of $6.7 million last year.
Revenues for the quarter grew to $60.5 million from $6.6 million in the year-ago quarter.
Revenue was negatively impacted by an increase in the average proportional royalty payable due to the methodology being applied to royalties basing fees on benchmark price levels set arbitrarily by the Mongolian government. The effective royalty for the quarter was 16 percent compared to 5 percent last year.
The company owns three coal projects in Mongolia, including the Ovoot Tolgoi Mine, a producing mine; and two development projects, the Soumber Deposit and the Ovoot Tolgoi Underground Deposit. During the quarter, the company was awarded the tender to construct a paved highway from Ovoot Tolgoi to Mongolia-China border with consortium partner NTB LLC.
The revenue for the quarter represented the highest quarterly revenue since the commencement of mining operations. Average realized selling price for the quarter increased 45 percent to $54 per ton.
In the Raw semi-soft coking coal category, Raw coal production for the quarter surged to 0.55 million tons from 0.18 million tons last year. Sales increased to 0.66 million tons from 0.11 million tons last year.
Raw higher-ash coal production for the quarter increased to 0.50 million tons from 0.39 million tons last year.
On average, 4 analysts polled by Thomson Reuters expected earnings of $0.02 per share for the quarter. Analysts' estimates typically exclude special items.
On a diluted basis, loss for the quarter was $0.02 per share, narrower than the loss of $0.08 per share in the year-ago quarter.
The net income in the quarter was due primarily to the $62.1 million gain on the fair value change of the embedded derivatives in the China Investment Corporation convertible debenture. This compares to a gain of $49.8 million in the third quarter of 2010 on the fair value change of the embedded derivatives in the CIC convertible debenture.
Net loss excluding specified items for the quarter narrowed to $3.8 million from loss of $23.6 million last year.
The company's income from mine operations is composed of revenue and cost of sales and relates solely to the Mongolian Coal Division. Income from mine operations for the quarter increased to a record level of $20.6 million compared to a loss from mine operations of $6.7 million last year.
Revenues for the quarter grew to $60.5 million from $6.6 million in the year-ago quarter.
Revenue was negatively impacted by an increase in the average proportional royalty payable due to the methodology being applied to royalties basing fees on benchmark price levels set arbitrarily by the Mongolian government. The effective royalty for the quarter was 16 percent compared to 5 percent last year.
The company owns three coal projects in Mongolia, including the Ovoot Tolgoi Mine, a producing mine; and two development projects, the Soumber Deposit and the Ovoot Tolgoi Underground Deposit. During the quarter, the company was awarded the tender to construct a paved highway from Ovoot Tolgoi to Mongolia-China border with consortium partner NTB LLC.
The revenue for the quarter represented the highest quarterly revenue since the commencement of mining operations. Average realized selling price for the quarter increased 45 percent to $54 per ton.
In the Raw semi-soft coking coal category, Raw coal production for the quarter surged to 0.55 million tons from 0.18 million tons last year. Sales increased to 0.66 million tons from 0.11 million tons last year.
Raw higher-ash coal production for the quarter increased to 0.50 million tons from 0.39 million tons last year.
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