31st Jul 2015 15:06
LONDON (Alliance News) - Anglesey Mining PLC Friday reported a narrowed pretax loss in its recently-ended financial year as it booked less expenses than in the previous year, but it still suffered from a fall in the value of its investment in Labrador Iron Mines Holdings Ltd.
The mining company said its pretax loss in the year ended March 31 narrowed to GBP1.7 million from GBP7.2 million the prior year, as it benefited from significant reductions in expenses, however it still made a loss due to the Labrador Iron investment declining in value.
Anglesey said that Labrador Iron did not undertake any mining operations during the 2014 operating season due to a combination of the prevailing low price of iron ore during the year, an assessment of the current economics of its deposits and a strategic shift in corporate focus towards establishing a lower cost operating framework.
In April, Labrador Iron initiated a court-supervised process under the Canadian Companies' Creditors Arrangement Act in order to facilitate a restructuring and refinancing of its business operations. The value of the Anglesey's investment in Labrador Iron has been written down to GBP1 in the accounts to March 31, Anglesey said.
Anglesey does not generate any revenue and does not recommend a dividend for the year.
"While the US economy continues to show signs of improvement, the global economic outlook remains weak and uncertain. China's growth continues to decelerate and Europe risks slipping into recession. Near-term growth prospects in both China and Europe now look dependent on further government intervention," Chairman John Kearney said in a statement.
"There is also concern that as prices rise, some Chinese zinc production will come back on line. While it is possible that Chinese production could increase to fill the gap, much higher prices are needed to sustain these operations. However, on the supply side, the pipeline of large-scale, development-ready, zinc-lead projects remains very thin and the long term outlook for the prices of both zinc and lead remains very favourable," he added.
Shares in Anglesey were trading down 9% at 1.82 pence on Friday afternoon.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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