Golden days for iron miner
Swedish iron ore giant LKAB boosts its revenues and can show off a record-high one billion EUR net profit for 2010.
In addition the company has set aside another billion EUR of reserves to be spent in times with lower earnings, company Economy Director Leif Boström says to Swedish Radio.
In its 2010 financial report, the company informs about an operating income of 12,281 billion SEK (1.37 bill EUR). The prices on iron ore was in 2010 back on the level of 2008
It is the high prices on iron ore in the international market following high demands which is taking the Swedish mining company to new heights. As previously reported by BarentsObserver, a total of 26 million tons of upgraded iron ore pellets and fines were shipped from LKAB’s harbors in 2010. And the times are not expected to turn anytime soon. Mr. Boström believes the good times will continue at least another ten years.
However, not all is bright and shiny for LKAB. The company is struggling to find additional manpower to its projects and major parts of the town of Kiruna will have to be moved to make space for the expanding ore extraction. Together with several other projects, the moving of the Kiruna town centre is expected to cost the company more than 2,2 billion EUR over the next years.
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That however will be manageable. Few companies in northern Europe are as financially healthy as LKAB. According to Swedish Radio, the company has eight billion SEK in cash, capital reserves of 33 billion SEK and no debts.
