ERA Reports Pleasing Profit

Energy Resources Australia today reported a positive annual profit results, with a 74.5% increase in net profit after tax.

Net profit for the Rio Tinto subsidiary rose to $76.1 million for year ended 31 December 2007 from the previous year's $43.6 million profit.

Earnings before interest and tax rose 57.2% to $108 million from $68.7 million.

Revenue from ordinary activities was also up by 14%. ERA said it met all delivery commitments by the end of 2007 and force majeure, declared after the February/March weather event, has now been lifted.

"Looking forward, the outlook for uranium demand appears positive. ERA continues to position itself to benefit from this by seeking opportunities to add value by expanding production and extending the duration of output from resources available to ERA," the company said in a statement.

ERA directors have declared a final dividend for the year of 20 cents per share, fully franked at 30%.

In regard to the outlook for 2008, ERA expects sales to be similar as those in 2007, possibly accompanied by a modest replenishment of inventory in the logistics chain.

"The $57 million mine expansion announced in September 2007 is currently on budget and ahead of schedule," ERA said.

In 2008 ERA will complete expansion of the current water treatment plant and commence treatment of process water.

"Looking forward, the outlook for uranium demand appears positive. ERA continues to position itself to benefit from this by seeking opportunities to add value by expanding production and extending the duration of output from resources available to ERA," the company said.

Shares in ERA closed $1.16 up at $19.99.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

View more articles by Glenn Dyer →