REPORTING SEASON: Atlas Iron Limited (AGO)

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Figure 1: Atlas Iron Limited 12 month chart

 

Atlas Iron Limited (AGO) agrees there is still more work to be done

 Iron ore miner Atlas Iron Limited (AGO) reported a net loss for first half loss for the FY15 year $1.09 billion, the result was impacted by iron ores price slide over the last year. Atlas recorded an average price per tonne received for its ore of US$62.82 compared to an average price of US$115.60 this time last year. Atlas Irons revenue fell over 23% over the year due to the price slide even with higher tonnes shipped up 34.8% (above AGO’s prior guidance)

 Atlas had already told the market about the one off impairment charges of $834 million downgrades to asset values and restructuring costs contributing to the statutory loss of $1,086.3 million, slightly worse than expected.

 Atlas said it now expected operating costs of between $60-63 per metric ton in the six months through June 2015, lower than its first half cost of $67.29 a metric ton.

 Atlas iron announced its cost reduction program is set to make annualised savings from cost improvements of $90 – 120 million larger than the $75 – $100 million it had stated at the end of December 2014.

 Atlas lifted its 2H15 shipping target to 6.8 – 7.2 million tons.

 As expected, Atlas Iron will not pay an interim dividend to shareholders.

 

You can see all of CommSec’s reporting season analysis by clicking here.

Juliana Roadley, Market Analyst,