MC Mining (MC), formerly known as Coal of Africa, said on Thursday that losses for the six months to end-December rose about 650% to $97.34m, following an impairment of its mothballed Vele Colliery.
MC’s primary listing is on the Australian stock exchange, with a secondary listing on the JSE.
The cash balance at the end of the period rose 41% to $10.2m, while revenue rose to $17m, from zero previously, due to its stake in the Uitkomst Colliery, the company’s sole operating asset.
MC acquired a 91% interest in the Uitkomst Colliery at the end of June 2017, but still faces hurdles regarding its flagship Makhado project.
The company’s loss per share increased about 473% to 78.39 US cents from 13.68 previously.
The company has the necessary regulatory approval to begin mining at Makhado, but needs access to farms to conduct geo-technical analyses — the land is currently subject to land claims processes. MC said on Wednesday that it expectsed these issues to be resolved in the second half of the current financial year.
Marketing and fundraising were expected to begin in the first half of the 2019 financial year.
At Vele, impairments of $87.5m were registered, due to, among other factors, a significant strengthening of the rand against the dollar.
"The company recorded significant progress during the period with production from the Uitkomst Colliery, further advancement of the Makhado project, as well as the sale of the non-core Mooiplaats asset," said MC CEO David Brown in the statement.
"The Mooiplaats disposal will yield annual operational cost savings of approximately $1.4m while the aggregate proceeds of $14.5m will be used to further develop our flagship Makhado project and/or the potential acquisition of a second cash-generating asset."
On Thursday morning, MC’s share price was unchanged at R6.20, having lost 15.42% in the year to date.
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