RJB Mining, the coal producer, yesterday warned that unless the Government comes up with state aid soon, 2,000 jobs are at risk.
Reporting a collapse in profits, from £50m in 1998 to £11.3m last year before exceptional charges, the company said: "We are disappointed that this decision (on state aid) has not been made by now."
The company also reported a £141.1m exceptional charge against last year's accounts, including a £131.0m write-down for the revaluation of assets.
The company began talks with the Government in November for subsidies of £74m to help to take it through to 2002, when subsidies that are granted to RJB's European competitors run out. The company expects coal prices will have improved by then.
In the absence of the subsidy, closure notices hang over Clipstone and Ellington collieries, which employ around 400 miners, already reduced from 800.
The subsidy would also safeguard up to 1,600 more jobs at other collieries, by allowing the company to fulfil contracts that it has in place. This includes the re-hiring of workers who have been issued with redundancy notices. RJB's total workforce is currently almost 8,000.
A spokesman for the Department of Trade and Industry said that "discussions are on-going", but gave no indication when they would be completed.
Richard Budge, RJB's chief executive, said: "We don't see subsidy as being the saviour of RJB but of these jobs."
Charles Kernot, an analyst at BNP Paribas, said: "RJB does not need this subsidy to stay in business.
Given the company's strong cash flow, it will be difficult for the Government to justify the subsidy."Reuse content