Mining and materials group Arrium has slumped to a $1.9 billion loss following a plunge in iron ore prices.
The South Australian-based miner’s loss for the year to June 30 compared to a $205.4 million net profit in 2013/14, after the company was hit by $1.799 billion of asset impairments and restructuring costs.
Sales revenue fell to $5.9 billion, from $6.5 billion, while Arrium’s underlying net loss was $6.7 million, down from an underlying net profit of $296 million, following a 40 per cent fall in iron ore prices.
Arrium said its first half earnings for 2015/16 were expected to be hit by falling Asian steel prices, but would also benefit from increased sales volumes and cost cuts.
The company, formerly known as OneSteel, announced in January that it was “mothballing” the iron ore mine at Peculiar Knob, around 90km from Coober Pedy, and “optimising its lower cost Middleback Ranges operation” near Whyalla.
You might like
It said then that a total of 200 full-time jobs – 30 per cent of the company’s mining workforce – will go, along with 380 contractor positions.
In June, it flagged a massive full-year loss after announcing a $320 million impairment hit on top of the $1.3 billion already announced in January.
The company also started a strategic review, which is ongoing.
In today’s results announcement, it said it had already implemented cost savings and productivity improvements. However, it had also identified an annualised savings target of $60 million, to be achieved by the end of the 2016.
– with AAP
