June 3, 2011 / 12:47 PM / 7 years ago

UPDATE 2-Grande Cache profit up; sees higher mining input costs

* Maintains 2012 sales volumes outlook of 2.2-2.4 mln tonnes

* Q4 EPS C$0.05 vs C$0.01 year ago

* Revenue up 33 pct (Adds details, share movement)

June 3 (Reuters) - Grande Cache Coal Corp reported a nearly four-fold rise in quarterly profit helped by higher selling prices, but said an increase in mining input costs or lower-than-expected production could impact its fiscal 2012 cost of sales.

In April, the Alberta-based metallurgical coal miner had cut its 2012 coal sales forecast by about 8 percent saying production at one of its mines was delayed.

The No. 8 pit at the Smoky River Coalfield, which went into production in the summer of 2010, has been plagued with various problems. [ID:nL3E7FF24T]

Grande Cache, which holds coal leases for about 22,000 hectares containing more than 235 million tonnes of coal in the Smoky River Coalfield in west-central Alberta, still expects to produce 2.2-2.4 million tonnes of coal in 2012.

In fiscal 2012, metallurgical coal is expected to account for about 90 percent of the company’s total sales volumes, while thermal coal will account for the rest. Metallurgical coal accounted for 93 percent of fourth-quarter sales volumes.

“We will see a strong metallurgical coal market over the next several years,” Chief Executive Robert Stan said in a statement, citing a rise in global steel production.

The company’s fourth-quarter net income rose to C$5.1 million, or 5 Canadian cents a share, from C$1.4 million, or 1 Canadian cent a share, a year ago.

Revenue rose 33 percent to C$67.3 million.

It sold 0.37 million tonnes of coal in the quarter at an average price of C$181 per tonne, compared with 0.43 million tonnes of coal at an average price of C$118 per tonne, last year.

Fourth-quarter sales volumes fell due to a decrease in clean coal production volumes, the company said.

Cost of sales was C$52.3 million, or C$141 per tonne, up from C$40.7 million, or C$94 per tonne, in the same period last year.

Shares of the company were trading down 1 Canadian cent at C$7.99 on Friday morning on the Toronto Stock Exchange. They earlier touched a low of C$7.83. (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Roshni Menon)

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