01/10/2008 - 10:02

Territory posts $49m loss for FY08

01/10/2008 - 10:02

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Iron ore miner Territory Resources Ltd has reported a full year net loss of $48.5 million, with over $40 million of that attributed to asset impairments and investments in collapsed Monarch Gold Mining Company Ltd and Matilda Minerals Ltd.

Iron ore miner Territory Resources Ltd has reported a full year net loss of $48.5 million, with over $40 million of that attributed to asset impairments and investments in collapsed Monarch Gold Mining Company Ltd and Matilda Minerals Ltd.

The net loss includes a total of $43.8 million in write-downs comprising a $16.8 million impairment charge associated with Territory's outstanding $21.5 million loan to Monarch and a $4.6 million impairment for Matilda.

The net loss is a substantial increase from the previous year's net loss of $6.9 million. Total revenue for fiscal 2008 was $60.4 million.

"This financial result is extremely disappointing and totally unsatisfactory," Territory chairman Andrew Simpson said.

"It is the result of a divestment strategy that, for a number of reasons, was not successful and therefore the Company's strategic stakes have been affected - as have all other share investors - by a significantly weakened share market since the beginning of the year.

"The investments have suffered due to the market's poor performance, and also poor operating performances in the invested companies, in particular the investment in Monarch - which was placed into administration in July 2008."

At an operating level the company posted an underlying loss of $4.5 million, reflecting higher cash operating costs and the increased level of capital expenditure for production ramp-up.

"In summary, the 2008 financial result is disappointing; however, it should also be seen as marking the beginning of a new chapter in Territory's history," Mr Simpson said.

Look forward, the company said it was on track to achieve it 1 million tonne shipping target early this month and drive down operating costs to below $60 per tonne. Cash costs were at $66/t during the 2008 financial year.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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