* NWR meets 2010 targets, but lower coking sales hit revenue
* Avg price on Q1 coking coal contracts up 7 pct q/q
* Agrees 13 pct rise in 2011 thermal coal sales
* Shares fall 4 percent in Prague
(Recasts after share reaction, adds analyst)
By Jason Hovet
PRAGUE, Jan 28 (Reuters) - Czech mining group New World
Resources (NWR) <NWRS.L> <NWRSsp.PR> warned of a drop in output
of more profitable coking coal in the past year, sending its
shares down more than 4 percent on Friday.
Although the miner, owner of the Czech Republic's largest
hard coal mines, said it had met 2010 production targets
overall, the proportion of coking coal in the sales mix was
lower than expected and this had hit full-year revenue.
NWR said the shortfall was caused by lower production at one
of its mines and was only partially offset by an increase of
thermal coal production at another mine.
NWR said coking coal output would not rebound until later
this year.
"The company expects an increase in coking coal volumes
towards the end of 2011 and a subsequent rebalancing of the
product mix towards coking coal in 2012," it said.
NWR shares fell 4.4 percent to 284.1 crowns by 0839 GMT, but
remained off lows hit earlier this month. The stock has risen 46
percent in the past year, boosted by rising commodity prices and
outpacing a 5 percent rise in the Prague bourse's PX index
<>.
"NWR's share price is currently well above our target price
and the worse outlook for production and sales mix substantially
reduces potential for an increase of the target price. We expect
negative reaction in following days," Ceska Sporitelna analyst
Petr Bartek said.
The bank has an NWR target price of 253 crowns.
NWR produced 11.4 million tonnes of coal in 2010 and 1
million tonnes of coke. In the current year, it said it expected
production of 11 million tonnes of coal and 800,000 tonnes of
coke.
NWR also reported price increases which analysts said were
roughly in line with market thinking.
It said the average price for first-quarter contracts of
coking coal -- comprising the 20 percent of volumes which had
not already been contracted for the fiscal year ending March --
would rise 7 percent over the fourth quarter to 165 euros per
tonne.
NWR had sold the other 80 percent of coking coal volumes in
yearly contracts last year and said the price remain unchanged
at 163 euros per tonne.
NWR also said it had agreed a 13 percent rise in the average
price for thermal coal sales in 2011.
External sales should reach 10.3 million tonnes of coal,
split evenly between coking and thermal coal, and 720,000 tonnes
of coke in 2011.
(Editing by Dan Lalor and David Holmes)
