Bloomberg reported that Yanzhou Coal Mining Co China fourth biggest producer of the fuel posted a 70% drop in third quarter profit from a year earlier because of foreign exchange losses.

The Shandong based company said in a statement to the Hong Kong Stock Exchange that net income dropped to CNY 1.1 billion from CNY 3.7 billion a year earlier.

Yanzhou which bought Australia Felix Resources Ltd for AUD 3.1 billion in 2009 reported a CNY 1 billion foreign exchange loss in the third quarter after the Australian dollar fell 10% against the US currency during the period. The Chinese coal producer posted a CNY 1.8 billion foreign-currency gain a year earlier.

Ms Helen Lau a Hong Kong based mining analyst at UOB-Kay Hian Ltd said “It’s payback for what it gained from last year. Everyone in the market had been expecting the exchange loss.”

The company said in the statement that production of raw coal rose 9.2% in the third quarter from a year earlier to 14.4 million tonnes. Output gained 11% in the first nine months to 40.1 million tonnes.
 

Source:steelguru