Arrium expansion advances despite $447m loss

Mining and steel company Arrium has recorded a near half-billion dollar loss, due to asset write-downs, taxes and restructuring costs.

The company, previously known as OneSteel, recorded a net loss of $447.2 million in the first half of the financial year.

Its underlying profit (which excludes one-off costs and gains) came in at $51 million, which is also down on the previous corresponding period.

Arrium says plunging prices for the iron ore it mines dragged on the underlying profit during the half.

It also says it paid no mining tax for the first half of the financial year, and was not responsible for any of the $126 million the Minerals Resource Rent Tax made in the first six months of its operation.

Last week Rio Tinto also said it did not pay the MRRT in 2012.

However, Arrium says the mining business was still profitable despite lower prices, and its chief executive Geoff Plummer says it is on track to double production by the middle of the year.

"The half also included the achievement of the planned major milestones in our mining business expansion including commencing the sale of ore from Southern Iron in October," he noted in the report.

"We are now progressing the commissioning and ramp up of our supply chain, including rail and transshipping through the expanded Whyalla Port, which will lead to the business doubling in size and becoming the fourth largest iron ore producer in Australia." Arrium shares were down 2.8 per cent to $1.225 by 10:37am (AEDT).

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