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Wednesday, 5 April, 2000, 07:40 GMT 08:40 UK
Mines at risk as losses mount
Miners at Harworth
Hundreds of mining jobs could be lost
The UK's biggest coal producer, struggling to keep pits open in the face of cheap imports, has reported a loss of 130m for 1999.

The fall at RJB Mining is because of redundancy costs and a revaluation of assets. Analysts had been expecting a loss of around 140m.

It means the company could go ahead with plans to shut two of its 13 pits.

RJB delayed its annual results from 2 March in the hope that it would have heard by now about possible government aid.

'Strong case for support'

The company wants the government to provide 73m.

But the Department of Trade and Industry said earlier this week it was still evaluating its application.
RJB balance sheet
Profit before tax and exceptionals 11.04m ($17.63m)
Profits in 1998 were 50.03m
Exceptional charges to cover revaluations and redundancies 141.07m
Post-exceptional loss 130.03m.

"We believe that we have presented a strong case for such support and that this is currently receiving serious consideration," said chairman John Robinson.

"We are disappointed that this decision has not been made by now."

The company said that if the help was not forthcoming, it would go ahead with plans to close Ellington, north-east England's last deep mine, which it announced last year.

Clipstone colliery in Nottinghamshire, which has been threatened with closure for some months, would also shut down. In total, more than 500 miners would lose their jobs.

RJB said it had secured contracts for coal sales in 2000 with volumes and prices at much the same levels as for 1999.
Richard Budge
Richard Budge: "Angry at delay"
That should enable the company to "continue to generate substantial operating cashflows".

International coal prices were starting to show signs of recovery from 1999's 25-year low.

RJB's chief executive Richard Budge is said to be angry at the government's "slow" response to the company's request for aid.

He has previously said that the government was aware of the problems facing the mining industry.

He said: "It is appropriate the government should at least consider some transitional financial support of the industry while prices recover.

Difficult economic climate

"When we acquired British Coal in 1994, imported coal prices were $40 per ton, today it is $21 per ton," he said last year, adding that "it is a very difficult economic climate out there."

But some critics say the time for subsidies has passed.

David Price, editor of Coal UK, says that there is no longer a case for subsidy as the international price of coal has risen closer to the British price.

RJB's call for help places more pressure on the government, already under fire not acting to prevent the loss of thousands of jobs at Rover's Longbridge plant.

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See also:

05 Dec 99 | Business
The fall of King Coal
24 Nov 99 | Business
Mine 'saved from closure'
01 Nov 99 | The Economy
Pit closure confirmed
31 Oct 99 | The Company File
Jobs under threat from pit closure
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