Lifted by record prices of coal, producer Geo Energy Resources has reported 3QFY2021 net profit from operations of US$45.5 million, a big swing from a loss of US$6.3 million in the year-earlier period.
Revenue in the same period was up 159% y-o-y to US$153.6 million.
The company expects an even better 4QFY2021 as both selling prices and production volume had further increased from 3Q.
The company plans to pay an interim dividend of 3 cents, which will be on top of two rounds of dividends already paid thus far this year.
Charles Antonny Melati, executive chairman of the company notes that the energy crisis will continue to keep coal prices at a buoyant level into the new year.
The benchmark index, M42, is indicating a price of US$90 per tonne for the rest of the year and heading into 2022, to remain at between US$70 and US$80 per tonne.
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He believes the company is well-positioned to capture this uptick in the industry with higher production quote of 11.5 million secured recently, up from 10 million previously.
Melati is aware of how coal is seen as the main cause of pollution, but he points out that coal is still the cheapest and most reliable energy source.
Having said so, Geo Energy is looking at diversification away from coal.
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The early redemption of its USD bonds last month has given it the flexibility to diversify its business and that Geo Energy will make the necessary announcements.
Geo Energy closed on Nov 10 at 34 cents, up 4.62% for the day and up 78.95% year to date.
