SHARES in UK Coal fell nearly 10 per cent yesterday after the company reported a 33 per cent drop in coal production in the first three months of 2012.
The news disappointed investors who had been hoping for better news following upbeat full-year results in April.
The Doncaster-based company also said net debt is starting to rise again. The group’s shares fell 1.5p to 14.75p.
Production in the first quarter fell from 2.1 million tonnes to 1.4 million. One million tonnes came from deep mines, down from 1.6 million in 2011 and 400,000 tonnes was from surface mines, down from 500,000.
UK Coal said production at its Daw Mill mine was poor.
The group added that the market price of coal has fallen, particularly since the end of April.
The group’s property division Harworth Estates is continuing with the disposal of £3m of surplus land. The sale of land on the Waverley Advanced Manufacturing Park to Rolls-Royce was completed in April and work has started on the first residential developments at Waverley.
At the end of March, total net debt was £154.1m, up from £138.8m in December.
The company said it is continuing with the consultation around its proposed restructuring and will update shareholders at its AGM on June 22.
Last month, UK Coal announced its first profit in four years, but this was overshadowed by a call for a major restructuring if the group is to keep its deep mines in operation.
The company announced a complex plan to separate its mining operations from its lucrative brownfield property interests.