August 22, 2008
Zinifex posts AUD 1.333 billion profit in 2007 FY
Melbourne based Global zinc major Zinifex Limited announced that its net income during July 2006 to June 2007 increased by 24% YoY to AUD 1.33 billion.
Production was approximately 5% down on the previous year with longer than normal planned maintenance shutdowns together with lower lead grades at Century primarily responsible for this. Despite this, the company had some strong individual efforts with the Hobart Smelter delivering record zinc production and the Budel facility increasing output.
Mr Tony Barnes acting CEO said that this was a terrific result for the company and its shareholders. He said “Breaking the one billion dollar mark last year was a significant milestone for Zinifex. To post a net profit this year some 24% higher again is simply an outstanding effort.”
Mr Barnes said that Zinifex’s mining business represented the lion’s share of the profit, contributing AUD 5 million. However, the half a billion dollars contributed to the bottom line by the smelting business should not be overlooked as it increased by a substantial 175% YoY. He said “Importantly, profitability of all operations increased with Rosebery, Hobart and Budel nearly double, or better, their contributions compared to the year before.”
Mr Barnes noted the ongoing strong performance of the resources sector continued to apply upward pressure on costs across the industry. He said “The resources boom has seen all companies in the sector have to face up to increased costs and Zinifex in not immune from this. While our headline cost rate went up by 15%, this was more than offset by the continued strong price of zinc and lead which were, on average, 74% and 58% higher than the previous 12 month period.”
Mr Barnes said that Zinifex is now well positioned to enter the next phase of its transformation into a fully-fledged global mining company. He said “The merging of our smelting assets into Nyrstar to create the world’s pre eminent zinc metal producer is on track to occur in September this year and we would expect to go to market at an appropriate time thereafter.”
