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ouch ..

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Valued Contributor

ouch ..

Significantly reduced coal prices and difficult operational conditions have resulted in the board of SACMH resolving to cease operations of the company with immediate effect for a period of three months and to place the operations on care and maintenance. During this period, the board will review the operations, including the capital requirements and cost structure, with a view to deciding on the future direction of the business. Shareholders will be kept informed of developments and should accordingly exercise caution when trading in the company's securities until a further announcement is made. Mirkwood
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15 REPLIES
Super Contributor

Re:ouch ..

Thanks Simon,the econony has taken a dire turn and it seems as if we are going to struggle for a longer period of time.
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Valued Contributor

Re:ouch ..

ya barry .. what I don't get .. coal is off highs from mid 2008, but isn't it still up on the 2007 prices ??
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Super Contributor

Re:ouch ..

some naive thoughts: amazing that almost everything world wide arrived at the same detrimental situation almost simultaneously - bankruptcy and depression. Can it actually be that the U S of A housing loan situation was the ONLY important event to bring the world's house of cards down?
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Super Contributor

Re:ouch ..

This is probably more a case of weak operational management, poor strategy and pathetic execution...opportunistically raised R100m a couple of months ago on what basis? So, the coal price tanks from giddy levels and the operation is shut down? What about the Eskom contracts? No sensitivity analysis at different prices etc.? Wait for the dirt to be revealed...in time. At least the Royal Ba*****eng have enough dough to lose some more?
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Super Contributor

Re:Re:ouch ..

B-a-f-o-k-e-n-g!!
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Super Contributor

Re:ouch ..

I'm somewhat surprised at this radical action by SACMH.I understood their coal contracts with ESKOM had favourable long term pricing locked in -- apparently not.Barry you're the coal Guru,how will this impact on the likes of CZA,WSL and others? Just how bad is the coal price at present ?
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Not applicable

Re:ouch ..

I am sorry - I can't resist! B-a-f-o-k-e-n-g worthy of a net-nanny censorship!! Excellent - I wonder what this esteemed tribe will think of that one!
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Super Contributor

Re:Re:ouch ..

As Topgun pointed out,poor management and planning,as Simon rightly pointed out the price is off its lows....A good operation with the right backing should thrive....with winter approaching,good contracts and a tight reign on costs most well run coal companies should comfortably carry on.
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Frequent Contributor

Re:ouch ..

If coal has come down so much (some say 60%) and the government has given Eskom some R60bil for new powerstations,then why are they looking for another 34% increase?!
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Valued Contributor

Re:Re:ouch ..

coal was at about $190/ton, now about 50 .. but eskom still sells electricity below cost, this is legacy from the old days ..
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Regular Contributor

Re:ouch ..

Skaaptjop, no use complaining, I have been lobbying to get Tom and Harry's friend D*** unbanned, to no avail.
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Red_Eye
New Contributor

Re:ouch ..

Hi Guys, Thanks for the info. What to do with the shares though????
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Red_Eye
New Contributor

Re:ouch ..

Hi Guys, Thanks for the info. What to do with the shares though????
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Valued Contributor

Re:ouch ..

South African Coal Mining Holdings (SACMH) had embarked on a cost-reduction exercise, the coal mining company said on Thursday. It was also exploring the recapitalisation of the business and finding a technology partner to assist with cost reductions. This comes after it said last month that following reduced coal prices and difficult operating conditions, the board would review group operations and capital requirements. This was with a view to determining the firm's direction. - Mzwandile Jacks
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inx
Occasional Contributor

Re:Re:ouch ..

any contacts for the company, getting in touch with the secretary is a nightmare
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