Here is a Strong Coal Company You Want to Look at!
Filed in archive by on February 02, 2006
One Canadian company that is profiting from this current situation is Westshore Terminals (Toronto: WTE-UN.TO.). They offer a very simple, easy to understand service: They transport coal by train and then unload it and put it on a ship. Being in Vancouver helps them location-wise as they just have to go across the ocean to be delivered.
The service that makes them so valuable is that they coordinate when the customer wants it with the known mine
output and then synchronize it with the shipping companies.Elk Valley Coal operates six mines. Five in southeastern British Columbia are:
Greenhills
Line Creek
Coal Mountain
Fording River
Elkview
Here are some specifics from their website:
On average, six unit coal trains up to 125 cars long arrive each day; it takes from 2 to 4 hours to unload a train depending on use of the single or twin rotary dumpers; dedicated coal train sets are on an approximate 80-hour rotation from mine to port to mine.
Current capacity 26 million tonnes a year.
Total shipments May 1970 to February 28, 2005 - 523 million tonnes 51,900 unit trains unloaded, 6,500 ships loaded.
While everything they do is simple, the customer wants aren't. Every customer has their own specs on different blends of the coal.
There are two major contributors to Westshore's business. The first is the price of the coal, which is the foremost factor in the value of the contract between them and the coal pit.
The second is how much coal is moved. The more that is moved of course the higher the profit. Global demand for steel, which companies are the biggest buyers, plus the high coal prices - which is what exists today - is a great opportunity for Westshore and investors.
Last year (2005) shareholders were rewarded with CDN$1.16 per share; it was around CDN$13 as an average for the year. As you can see, this is approximately the equivalent of a 9% dividend. Since there is almost no re-investment, just about all profits are paid out to the shareholders.
If you like this type of investment, this could be a great company to check into.
Greenhills
Line Creek
Coal Mountain
Fording River
Elkview
Here are some specifics from their website:
On average, six unit coal trains up to 125 cars long arrive each day; it takes from 2 to 4 hours to unload a train depending on use of the single or twin rotary dumpers; dedicated coal train sets are on an approximate 80-hour rotation from mine to port to mine.
Current capacity 26 million tonnes a year.
Total shipments May 1970 to February 28, 2005 - 523 million tonnes 51,900 unit trains unloaded, 6,500 ships loaded.
While everything they do is simple, the customer wants aren't. Every customer has their own specs on different blends of the coal.
There are two major contributors to Westshore's business. The first is the price of the coal, which is the foremost factor in the value of the contract between them and the coal pit.
The second is how much coal is moved. The more that is moved of course the higher the profit. Global demand for steel, which companies are the biggest buyers, plus the high coal prices - which is what exists today - is a great opportunity for Westshore and investors.
Last year (2005) shareholders were rewarded with CDN$1.16 per share; it was around CDN$13 as an average for the year. As you can see, this is approximately the equivalent of a 9% dividend. Since there is almost no re-investment, just about all profits are paid out to the shareholders.
If you like this type of investment, this could be a great company to check into.
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