Murchison Metals Ltd has posted a full year net profit of $56 million for the 2008 financial year, a turnaround from the previous year's loss of $45 million.
Murchison Metals Ltd has posted a full year net profit of $56 million for the 2008 financial year, a turnaround from the previous year's loss of $45 million.
Below is the statement from the annual report:
Murchison Metals Ltd is pleased to announce a $55.6 million profit for the year to 30 June 2008.
The strong profit result flowed from completion of the Mitsubishi transaction under which an initial payment was made resulting in Mitsubishi acquiring a 50% interest in each of Murchison's iron ore business Crosslands Resources ("Crosslands") and its infrastructure business Oakajee Port & Rail ("OPR").
A second and more substantial payment is due after completion of the Jack Hills Stage 2 Bankable Feasibility Study.
Both Crosslands and OPR made major advances with their respective projects during the year, building a platform for the delivery of significant value to Murchison shareholders.
Given the backdrop of enormous volatility and weakness in global financial markets, Murchison is very well positioned with its strong balance sheet and a suite of developing projects for another good year in FY09.
Murchison recently raised approximately $135 million through the sale of its 9.2% stake in Midwest Corporation, with the proceeds to be used primarily for the development of the Company's existing assets - Crosslands, OPR and the exciting Rocklea project in the Pilbara region of Western Australia.
Murchison's strong cash position - which now stands at approximately $165 million - puts the Company in a strong position to maximise the value of these projects for the benefit of Murchison shareholders.
The Directors are very aware of the recent sharp decline of the Company's share price and believe this is attributable to the crisis in world financial markets and the liquidity issues this has caused for a wide range of institutional investors.
The impact on Murchison's share price is not reflective of the significant value that has been added to the Company's projects and the strengthening of its balance sheet in a difficult market environment.
Prominent in adding value for Murchison shareholders was OPR's success in July 2008 in being selected by the State Government of Western Australia as its preferred proponent for the development of the Oakajee port.
Murchison Executive Chairman Paul Kopejtka said the Company was expecting further significant and positive developments in its mining and infrastructure businesses through the remainder of the 2009 financial year.
"The 2008 year saw Murchison put in place an outstanding platform for the development of its projects," said Mr Kopejtka.
"In the current year, we confidently expect to see Crosslands and OPR move to the next level and take critical steps towards the fulfilment of their major project development ambitions.
"Murchison remains very focused on driving value for shareholders through the successful development of these mining and related infrastructure projects, which are now in the hands of highly experienced and professional management teams in the independent businesses of Crosslands and OPR."
