JOHANNESBURG (miningweekly.com) – JSE-listed mining services provider and coal miner Sentula Mining on Thursday reported a 35% increase in headline earnings a share to 11.5c for the six months ended September 30, up from 8.5c a share during the prior corresponding period.

However, group revenue for the period declined 19%, from R1.18-billion in the first half of the previous financial year, to R951-million in the six months under review.

The group’s earnings for the six-month period were adversely impacted by a R273-million impairment on mineral rights held for sale, a R40-million provision of slow-moving inventory in the sale of the group’s Benicon business, the ongoing depressed exploration drilling cycle and the below-expectation performance of the group’s opencast operations.

Meanwhile, Sentula stated that the good performance of its mobile crane hire business, Ritchie Crane Hire, and a R30-million recovery in funds misappropriated in the 2008 financial year positively impacted on the half-year performance.

“Our crane business performed extremely well during the period, and we continued to invest in this business,” Sentula Mining CEO Robin Berry told Mining Weekly Online, adding that, in terms of the group’s opencast business, the ramp-up of the Spitskop contract for Samancor was also starting to deliver results.

Meanwhile, JEF Drill and Blast had experienced a drop in its revenue and profit base during the period, following the sudden loss of the Tharisa contract but remained positioned to deliver sustainable earnings, at current margins, as it continued to diversify its commodity and geographic exposure.

Berry further said the company continued to follow the process of disposing of its coal assets.

“Notwithstanding the commitment to assess an opportunity that may arise on any of the group assets, Sentula continues to focus its efforts on the disposal of the three key interests in the Schoongezicht prospecting licence and the Nkomati operations and Bankfontein mining right,” Sentula said. 

Berry stated that a deal on the Schoongezicht property had been concluded with a Section 11 transfer document having been received from the Department of Mineral Resources.

“We are also progressing aggressively on the disposal of the remaining two assets and hope to complete this process by the end of the financial year,” he said.

Meanwhile, over the next period, Sentula would also focus on extracting efficiencies from its opencast mining businesses.

“These businesses are still in a tough space and, from our perspective, we have done a lot of work to consolidate the operations, both in the number of operations, as well as in consolidating the two opencast mining businesses into one, which we hope to complete by the end of the financial year,” he said. 

The total operations of Sentula group company Classic Challenge Trading’s (CCT’s) Spitskop pit had already been incorporated into Benicon, with the remaining operations of CCT still to be incorporated into Benicon.

“Driving efficiencies in our opencast business is still a key focus for us,” Berry added.

In the longer term, Sentula would, along with improving its efficiencies and growing its businesses that are doing well, also do continuous work in the exploration sector.

“We have to stay in the game in the exploration sector, because once there is an uptick in the commodity market, which will happen in time, we want to be positioned to benefit from it,” he concluded.