ATH Resources "mystified" at share price fall
OPENCAST coal mining group ATH Resources today admitted it had no idea why its shares have dropped recently.
The Doncaster-based group said that it is continuing to trade in line with market expectations and chairman David Port said it was “absolutely mystified” why its share price had dropped around 10% in the last 10 days.
It has fallen from 185p to close last night at 161p but its announcement this morning looked to have helped reassure the market and the shares rose to 163.5p in early trading.
Mr Port said: “It has dropped dramatically in the last 10 days on the back of a small volume of retail selling. We are absolutely mystified by that. Production in the second half has gone exceptionally well and we are getting good prices for coal.
“In fact when coal prices went up eight or nine months ago our share price didn’t go up, so we were a bit hurt by that! I know UK Coal’s share price has come down recently, but we see it as more of a property firm these days.
“It’s just one of those quirks of the market and we have put out this statement today to reassure people that nothing has changed with trading from the half-year,” he added.
In June it reported a drop in half-year profits after planning consent problems and closed sites postponed deliveries of coal, however it said it still expected trading to hit forecasts for the full year.
The group, headed by chief executive Tom Allchurch, has increased productivity in recent months and is confident it will lift full-year profits as sites move back into production and new mines open.
In its interim results for the six months ended March 30, ATH said that turnover stood at £28.1m compared to the previous year’s figure of £31.2m against coal sales of 787,000 tonnes compared to 973,000 tonnes for the same period.
Pre-tax profits stood at £400,000 compared to £2.7m in 2007.
Earlier this year ATH announced it was named as preferred bidder on a 12 million tonnes tailings washing project in Queensland, Australia. Mr Port said that progress on this was slower than the group would have liked, but it is moving closer to signing a deal.
