January 10, 2020 / 11:42 AM / 10 days ago

Polish coal producer JSW to tap its contingency fund to finance investments

KATOWICE, Poland (Reuters) - Poland’s JSW, the EU’s biggest coking coal producer, will use 700 million zlotys ($183 million) from its contingency fund to expand coking coal production and other investments, its CEO said on Friday.

State-run JSW, which also produces thermal coal, almost collapsed in 2015 when coal prices slumped and labor costs rose. In 2018 it set up a special fund to put aside cash to help cope with difficult times.

On Wednesday JSW said it had decided to redeem fund investment certificates amounting to 700 million zlotys for investments and general use but did not give more details.

Chief Executive Wlodzimierz Herezniak told reporters on Friday that the company plans to spend around 2 billion zlotys on investments this year including the 700 million from the fund.

“The money will be spent on coal investment, including an increase in coking coal production,” Herezniak said.

“Investment assumptions for 2020 are at a similar level to last year’s when they amounted at around 2 billion zlotys,” he said.

As of last September, the balance value of the contingency fund stood at 1.86 billion zlotys, according to latest figures from the company.

Reporting by Wojciech Zurawski; Writing by Agnieszka Barteczko; Editing by Susan Fenton

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