State-owned resources company Solid Energy has invested $325 million in developing its business in a range of areas it believes will create significant value in the future.
The investment was detailed in the company's annual profit report today, which showed a strong pick up in revenue in the second half of the year.
Solid Energy had a net profit after tax of $67.8 million in the year to June 30. This is down from a $110.8m profit last year but the company said it is a turnaround from a $6.5m loss at the half year.
Two thirds of the $690m annual revenue was in the second half but the total is down from $980m last year.
"The company has emerged from the global economic downturn strongly positioned with the successful completion of a number of major capital projects that will allow us to increase production in our coal and renewables businesses," said chairman John Palmer.
The result comes at a time of debate about the management and ownership of state-owned enterprises. Mr Palmer has called for partial sales but Rob Cameron, who chaired the Capital Markets Development Taskforce, said yesterday that the Government has put on hold a taskforce recommendation to list or partially sell state-owned assets.
The Government received a $24m dividend on September 24, 2009 and $30m on March 31. The total of $54m is down from $59.9m the previous year.
Mr Palmer said $325m of investment included $172m of direct capital expenditure by Solid Energy and $19m by its 51 percent joint venture Spring Creek Mining Company and $134m on leased capital items, mainly at the flagship Stockton Mine.
Of the total, $249 million was spent at Stockton, primarily on the coal processing plant, mobile plant and equipment and safety and environmental projects.
The company also completed a $34m wood pellet plant in Taupo and a $17m biodiesel production facility at Rolleston.
"During the year we also continued development and investment in a range of other business areas that will create significant future value," Mr Palmer said.
"In the Waikato, our underground coal gasification pilot plant is in development and we are preparing to expand our coal seam gas project.
"We have advanced all our Southland lignite conversion projects significantly including briquetting, humates, urea and transport fuels.
"We expect to start construction of demonstration-scale plants for lignite briquetting and a new technology that can convert lignite and biomass directly to crude oil."
