Mount Gibson (ASX:MGX) Profit Jumped in FY2010

Sydney, July 21, 2010 AEST (ABN Newswire) - Mount Gibson Iron Limited (ASX:MGX) reported a record unaudited net profit after tax (NPAT) for the year ended 30 June 2010 of A$132.4 million, up from A$42.6 million last year. The company delivered a 23 per cent increase in ore production and a 20 per cent rise in ore sales, compared to the figures of previous year.

The NPAT includes a A$28 million settlement amount paid by Sinom (Hong Kong) Ltd. after Sinom failed to take scheduled iron shipments in accordance with binding long term offtake agreements. Mount Gibson signed a number of long term offtake agreements with various traders and steel mills before the global financial crisis (GFC). During the December quarter 2008 the company said it suffered breach of contracts due to the GFC and subsequently terminated agreements with three customers.

Mount Gibson said it had achieved record ore sales from its Tallering Peak and Koolan Island projects. Extension Hill DSO project is also on schedule to commence shipments in the first quarter 2011/12 financial year.

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Michelle Liang Asia Business News Asia Bureau Tel: +61-2-9247-4344 Email: michelle.liang@abnnewswire.net