WARSAW (Reuters) - State-run JSW said it had increased output of coking coal and should benefit from a price upturn once an easing of lockdowns stimulates demand, as it sought to reassure investors following a first-quarter loss and a more than 5% share price fall.
Poland’s JSW is the European Union’s biggest producer of coking coal, which is of higher value than thermal coal because of its usefulness in steelmaking.
In the first quarter, it said its coking coal production rose to 3.2 million tonnes from 2.4 million tonnes in Q1 2019, while sales to external clients rose to 1.5 million tonnes from 1.45 million as it expands into foreign markets.
At the same time, thermal coal output fell to 896,000 tonnes from just over a million tonnes a year ago. Poland is heavily dependent on thermal coal for its power, but is seeking to shift to greener sources.
“We expect that with the unfreezing of the economies happening around the world, there is a chance that the prices will be better ... It seems to us that we are above the bottom,” Chief Executive Wlodzimierz Herezniak told a conference on Friday when asked about coking coal prices.
Prices fell by more than 10% in the first quarter when JSW suffered a 212 million zlotys ($51.15 million) net loss compared to the 32 million zlotys loss expected by analysts.
On Friday its shares traded 5.7% lower at 1345 GMT, recovering from an earlier dive of nearly 9%. The wider market was around 0.5% lower.
JSW’s management, which usually provides full year output and capex guidance, declined to do so.
Analysts saw little evidence yet of any price rally.
“I do not see clear signals of a coking coal price rebound. The first effects may be visible when there is information about some stimulus in the construction industry,” Lukasz Rudnik, analyst at Trigon brokerage, said.
Reporting by Agnieszka Barteczko and Anna Koper; editing by Barbara Lewis