Cash flow comes to Wescoal’s rescue as profits cut in half
Strong cash flows allowed miner and merchant to cull debt and reposition it strongly for further acquisitions
Junior miners are at the best of times subject to jitters in sentiment. It’s doubly bad when there is a production setback or plunge in profits – even if the cause is not exactly the fault of management.
Wescoal – a coal miner and merchant – had to endure labour disruptions (after a contractor changeover at its Vanggatfontein mine) as well as contend with above average seasonal rainfall.
While the income statement does not make for happy reading with profit more than halved to R88m, the cash flow statement does offer some reassurance...