Fording Announces Settlement of 2008 Coal Year Contracts
09 Maggio 2008 - 2:14AM
Marketwired
CALGARY, ALBERTA (NYSE: FDG) today announced that Elk Valley
Coal has completed negotiations for approximately 90% of its
anticipated coal sales for the 2008 coal year. If the remainder of
the 2008 contracts are settled on similar terms, the average price
for the 2008 coal year (April 1, 2008 - March 31, 2009) is forecast
to be approximately US$275 per tonne for all coal products,
compared with an average price of US$93 for the 2007 coal year. The
average coal sales price may vary from quarter to quarter due to
sales mix, including the timing of PCI (Pulverized Coal Injection)
and thermal coal sales.
The average price of 2008 calendar year coal sales is forecast
to be in the range of US$195 to $205 per tonne. The actual sales
price received for the calendar year will be dependent on total
sales volumes shipped in the year, and the timing of sales of lower
valued products, including PCI and thermal coal. Elk Valley Coal
has approximately 3.5 million tonnes of carryover tonnage from the
2007 coal year. Approximately two-thirds of the carryover is
expected to be delivered in the second quarter, and the remainder
is expected to be delivered relatively evenly over the balance of
the coal year.
Actual Canadian dollar coal prices received will depend on
fluctuations in the U.S./Canadian dollar exchange rates. The Trust
has commenced entering into foreign exchange forward contracts for
the 2008 coal year. As of the date of this news release, the Trust
has US$1.8 billion of forward contracts outstanding at an average
contracted exchange rate of US$0.99. The total amount of foreign
exchange forward contracts that will be entered into by the Trust
will be considerably larger than in prior years as a result of the
increase in coal prices. This may lead to increased volatility in
our net income because the forward contracts will be
marked-to-market each quarter. These unrealized gains or losses
will be affected by the amount of contracts outstanding and
fluctuations in the U.S./Canadian dollar exchange rate. However,
the foreign exchange forward contracts will help reduce the effect
of foreign exchange fluctuations on the Trust's cash flows.
About Fording
Fording Canadian Coal Trust is an open-ended mutual fund trust
and one of the largest royalty trusts in Canada. The Trust makes
quarterly distributions to unitholders using royalties received
from its 60% interest in the metallurgical coal operations of the
Elk Valley Coal Partnership. Elk Valley Coal Partnership is the
world's second largest exporter of seaborne metallurgical coal,
supplying high-quality coal products to the international steel
industry. The Trust's shares are traded on the Toronto Stock
Exchange under the symbol FDG.UN and on the New York Stock Exchange
under the symbol FDG.
Contacts: Fording Canadian Coal Trust Colin Petryk Director,
Investor Relations (403) 260-9823 Fording Canadian Coal Trust Najda
Dupanovic Coordinator, Investor Relations (403) 260-9892 Email:
investors@fording.ca Website: www.fording.ca
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