Czech coal firm NWR's net profit below expectations

Prague - Czech coal company New World Resources NV (NWR) said Thursday its annual net profit rose 6 per cent in the third quarter of 2008, a result that was below market expectations. NWR's third-quarter net income grew to 70.3 million euros (88 million dollars) this year from 66.3 million euros in 2007, according to the unaudited consolidated results. The July-September revenues more than doubled year-on-year to 515.5 million euros in 2008 from 324.4 million euros last year. The firm's shares plunged over 10 per cent to 61.91 koruny in midday trading on the Prague Stock Exchange. The stock was priced at 440 koruny when the mining company joined the bourse in May. NWR, the owner of the Czech Republic's largest coalmining company OKD, said it was unclear how the global financial crisis would impact its contracts for 2009. 'It is as yet too early to say to what degree these negotiations will be affected by the broader credit-related economic issues which are impacting our steel mill customers,' executive chairman Mike Salamon said in a statement. Nevertheless, the company expected to be fully contracted in 2009 'given the significant shortage of coal the region has experienced during the first nine months of this year.' NWR operates mines in the Czech Republic's north-east and has customers across Central Europe, including Arcelor Mittal Steel, US Steel, Moravia Steel or CEZ. The Dutch-registered firm was expanding to Poland where it was granted a 50-year government licence to extract coal from the southern mine of Debiensko. NWR said the mine's final feasibility study would be concluded in the first half of 2009. The company, whose majority owner is RPG Industries, which is co- owned by Czech financier Zdenek Bakala, listed its shares in Prague, Warsaw and London earlier this year.