By ERIC TAPAKAU OWNERS of the once world class Panguna copper/gold mine, Bougainville Copper Limited has announced a jump in the companys profit for the year ended December 31, 2009. The company reported a net profit of K8.7 million ($A4.3 million) compared with a loss of K4.8 million ($A2.3 million) the previous year. In addition there was an unrealised K63.6 million capital gain which together with the net profit equates to a 24.6 per cent increase in shareholder funds. Operating expenses in this reporting period were in line with those of last year. Company secretary Paul Coleman said that the higher net profit this year was attributable to realised gains on the sale of investments and exchange gains. He also said that the tax dispute legal fees continued to be a drain on revenue. Mr Coleman reported that the directors of the company did not declare any dividend in respect of the 2009 net profit. The annual general meeting of the company will be held at the Crowne Plaza Hotel, Port Moresby at 10 am on Thursday April 29, 2010 and annual report and notice of meeting will be mailed to shareholders by March 26. Operations at the Panguna mine stopped in 1989 due to secessionist uprisings and an impairment loss of K350 million was made for deterioration, damage or pilferage of company assets on Bougainville. According to Mr Colemans report, the accuracy of that provision could not be proved because the lack of access to Bougainville prevented a detailed assessment of the nature or extent of those losses. No depreciation charge or increase to the impairment loss has been made since 1991. The directors consider that any review of the impairment loss would be completely arbitrary because of the continuing lack of access to the mine.
BOC Price at posting:
50.5¢ Sentiment: ST Buy Disclosure: Held
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