LONDON (Alliance News) - Commodity-focused investment company Anglo Pacific Group PLC said total royalty income fell to GBP2.3 million during the first quarter 2014 compared with GBP4.6 million a year earlier as it was beset by a number of problems.
The natural resources business said total royal income earned from its Kestrel mine in the first quarter was AUD2.8 million, down from AUD4.2 million in the first quarter 2013.
The company's core asset is its 50% ownership of mining and mineral rights which entitle it to coal royalty receipts from the Kestrel and Crinum mines, located in Queensland, Australia. These mines are operated by Rio Tinto Coal Australia and BM Alliance Coal Operations Pty Ltd, a 50:50 joint venture between BHP Billiton and Mitsubishi, respectively.
Anglo Pacific said total production at the Kestrel mine fell to 869,000 tonnes in the first quarter, from 983,000 in the fourth quarter 2013. The group expects mining Kestrel to move fully within the group's private royalty land over the next two years.
Looking ahead, the company said royalty income from Kestrel in 2014 is anticipated to be lower than that in 2013.
However, it said as production at the new Kestrel South mine gradually moves into its private royalty land, a process expected to be complete in 2016, royalty income and dividend cover should recover.
In addition, Anglo Pacific expects sales to commence at the Alliance Resource Ltd operated Four Mile uranium project in July, with royalty income to follow thereafter.
The company said it expects cash flow to be enhanced from the sale of certain equities within its mining and exploration interests.
Anglo Pacific shares were quoted down 0.1% at 180.77 pence Monday morning.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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