Britain's largest coal-mining company UK Coal saw shares jump on Monday morning after the firm said that full-year operating profits and production were in line with expectations in 2011.
UK Coal, which returned to profitability last year, is still in the first year of its three-year 'Strategic Recovery Plan' launched in May 2011, but has already cut its net bank debt from £141m to £55m (as of December 2011).
In a further attempt to reduce borrowings, the group said it is in the early stages of looking into the possible sale of Harworth Power, a business which generates electricity from mine methane.
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"Looking forward, delivery of the recovery plan at Daw Mill remains the highest priority," the group said.
Lower production at the Daw Mill site near Coventry, the single largest coal producing mine in the UK, meant that total group production in the fourth quarter was 1.6m tonnes, down from 2.3m tonnes the year before. "The programme to mitigate a face gap fell short of the mine's commitment, resulting in negligible production from Daw Mill through December," the firm said. A new face is ramping up during January.
Nevertheless, full-year output reached 7.5m tonnes, above the 7.2m tonnes recorded the year before.
Shares were trading 8.47% higher at 32p in early trading.
