Bloomberg reported that Exxaro Resources Limited is reviewing its capital expenditure plans as the global financial crisis cuts demand for commodities and moves the company into uncharted territory.

Mr Sipho Nkosi CEO of Exxaro said that it is reviewing its project pipeline to conserve cash because of falling demand. He added that "We are moving into an area of uncertainty."

He added that lower average zinc prices, combined with an increased environmental provision, resulted in Exxaro’s base metals business posting an operating loss of ZAR 172 million for the year to December 31st 2008 as compared with a profit of ZAR 688 million the year before.

Mr Nkosi said that this division is expected to remain under pressure this year because of depressed market conditions and weak zinc prices, adding that the situation may improve in the latter part of 2010 to 2011.

Earlier, Exxaro said that annual profit more than doubled on higher coal prices in the first three quarters of the year. Net income climbed to ZAR 3.38 billion from ZAR 1.45 billion in 2007. Sales increased by 36% YoY to ZAR 13.8 billion.

(Sourced from www.bloomberg.net)