Gloucester Coal has posted a 59 per cent fall in net profit for the first half of 2009/10, but says its volumes and margins remained healthy.

Gloucester reported net profit for the first half of $18.099 million, down from $44 million in the first half of fiscal 2009, on revenue of $103.661 million, down 24 per cent on the prior corresponding period.

The company has declared no interim dividend for the period.

Earnings before interest, tax, depreciation and amortisation were $25.5 million, down from $46 million.

"We are pleased to have achieved this strong financial result despite the volatile economic conditions," Gloucester Coal chief executive officer Barry Tudor said in a statement.

"Although the sales price of our semi-hard coking coal fell by over 60 per cent from last year, the company was able to maintain healthy volumes and solid margins."

Gloucester said demand for its coal remained strong and in line with expectations.

The company said its 59 per cent fall in net profit compared to a period when coking coal prices had been at historic highs.

"The outlook for Gloucester Coal remains positive, with the outlook for coking coal very strong," Gloucester said.

"Spot hard coking coal sales have been reported at prices substantially higher than those seen in the previous financial year and the company recently entered into a contract to supply coal at US$164 per tonne.

"Gloucester said it was expanding production and extending mine life while accessing more economic reserves.

"New strategic markets are being identified to diversify sales of thermal and coking coal and provide new markets for the increase in production to 3.5mtpa (million tonnes per annum).

"The strong half year result, combined with the company's recently announced strategic initiatives place Gloucester Coal in a good position to capitalise on a strengthening market."

Gloucester sold 914,000 tonnes of coal in the period, down from 921,000 tonnes in the prior corresponding period.