Coal mine group hits a rich seam

The group's property business more than doubled its contribution from 19.9 million to 54 million and profits from open cast mining almost quadrupled from 1.2 million to 4.5 million.

Losses on deep mining mounted from 900,000 to 15.3 million after a period with no production at Daw Mill colliery in Warwickshire cost the company 20 million.

But, UK Coal made a 12 million profit on the sale of Maltby Colliery in South Yorkshire to minerals and support services group Hargreaves.

UK Coal chairman, David Jones, says UK Coal's deep mines have been making operating profits since June and production from its open cast mines has grown considerably

"These good results demonstrate the considerable progress UK Coal has made in the first half of the year," said Mr Jones.

"We have significantly increased the value of our property business, strengthened the operating performance and prospects of our mining businesses, more than doubled pre-tax profits and significantly grown the value of net assets per share.

"There will always be risks in mining; but these are very positive developments. In property, we continue to identify new opportunities and to make very good progress in securing the appropriate planning consents and progressively executing our development strategy.

"We view UK Coal's future with considerable confidence and look forward to delivering further good growth in shareholder value for the full year and beyond."

The value of UK Coal's property portfolio has grown by 36 per cent on the same period last year to 398 million after the group gained new planning permissions and made progress on a number of developments.