JAMIE CARR: Wescoal firmly in the black
Wescoal shines like a rainbow unicorn amid the gloom that is spewing forth from many sectors of the coal market
Coal mining may not be the most glamorous of businesses, but the recent results announcement from Wescoal shines like a rainbow unicorn amid the gloom that is spewing forth from many sectors of the market. The group set out a number of strategic goals in 2015, and by the end of March 2018 it had managed to achieve 90% of them — despite the considerable challenges the business environment faced in the intervening period. The key contributing factors were Wescoal’s ability to transform the group, secure long-term debt funding, increase production, and acquire and succeed in integrating Keaton Energy. Its three-year compounded net average profit growth is sitting at an impressive 91%/year, thanks to efforts to reduce costs and improve efficiency. The acquisition of Keaton has been bedded down, with operational cost reductions and efficiencies already saving about R40m a year, while additional savings have been identified and are being implemented. Strengthening the balance sheet and se...
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