CHL gets paid on a per tonne basis for their coal testing services, but the rate they get paid at is negotiated every 2-3 years and they always get a far more attractive rate when the coal prices are higher.
They recently stitched up their contract with BHP which brought them a higher rate per tonne than they had previously, and as I posted in the last comment, volumes of coal being shipped overseas by BHP and all the mining players is rising on heavy global demand being driven from China, Japan, and India.
so its more tonnes to be tested and higher prices being charged for each tonne of coal they test. A good recipe for profit growth.
It must be why another director announced yesterday he has bought a further 100,000 shares at 19.5c on the market!!
CHL Price at posting:
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