VANCOUVER (miningweekly.com) – A bullish Anglo Pacific Group on Wednesday announced that royalty income for the September quarter surged 147% year-on-year to £4.7-million, boosted by price activity in both coking and thermal coal prices since the half-year.
The LSE- and TSX-listed company said it saw the price of coking coal more than triple, and the price of thermal coal more than double since the half-year, which is posturing for a strong fourth-quarter result.
“We believe that more good news is still to come in Q4 2016, when increased coal prices and mining in our royalty areas should benefit the company still further,” stated CEO Julian Treger.
Anglo Pacific also advised that royalty income for 2016 was expected to be considerably higher than previous expectations. The company noted that Peabody and Glencore had settled contracts at $200/t, up 117%, and that it would make an announcement once prices had been set.
Anglo Pacific owns a portfolio of royalties on coal assets in Australia and remains one of the only listed royalty companies that provides high levels of exposure to coking coal price fluctuations.
It also has precious metals and uranium royalties outside Australia.
The company added it now expected full dividend cover for 2016 ahead of the previous guidance, and an acceleration in the timeframe when the group can consider gradually increasing its dividend.
“With the outlook for robust coal prices set to continue through H1 2017, we look forward to the corresponding benefit to our dividend cover,” Treger said.