Mt Gibson lifts first-half profit by 111pc

UPDATE 2.10pm: Mt Gibson Iron has lifted its first-half profit by 111 per cent to $78.3 million on record half-yearly revenue of $509.5 million from record ore sales of 5.1 million wet metric tonnes.

But shares in the Chinese-controlled iron ore miner slumped after its profit from continuing operations before tax was $111.5 million, well below consensus forecasts of a figure closer to $125 million.

Mt Gibson said cash and term deposits had increased by $107.9 million over the period to $483.9 million.

Net operating cashflow increased four-fold to $170.6 million.

Mt Gibson did not declare an interim dividend, in line with its policy of only considering dividends on an annual basis.

The company said it was on track to achieve record full-year ore sales in a range between 9-9.5 million tonnes.

Chief executive Jim Beyer said the company's strong result was built on significant underlying business improvements.

"At the same time, we have established a strong platform for future success by maintaining a diligent focus on cost control, increasing ore reserves at our existing operations and expanding our suite of exploration and development opportunities, most notably in the Mid West," he said.

"This approach, together with our healthy balance sheet, positions Mount Gibson extremely well for the remainder of the financial year and prepares us well for any future volatility in iron ore prices and market conditions."

The company also announced today that Geoff Hill would step down as chairman of the company and later in the year retire from the board.

Deputy chairman Lee Seng Hui will assume the role of chairman and the company will appoint another independent director.

Mt Gibson operates three iron ore mines in WA including Tallering Peak, Koolan Island and Extension Hill.

Shares in the company fell 18.5 cents, or 15.42 per cent, to close at $1.015.

The West Australian

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