Jastrzębska Węglowa (JSW) is facing 1 of the most hard periods in its history. Although the company implements an ambitious recovery plan, financial problems and deficiency of access to key coal coking deposits Dębieńsko makes her future questionable. What challenges await the JSW and what steps does the company take to last in hard times?
Saving plan for PLN 8.5 billion
Despite evidence losses, the JSW authorities announced that they were not planning to lay off workers or cut wages. Instead, the company focuses on restructuring and implementing an ambitious corrective plan, which is to bring PLN 8.5 billion savings by 2027.
One of the key elements of the plan is the "Effective Mine" project, which is intended to increase the yearly extraction of coke coal to 14.5 million tonnes. It is estimated that these actions will make an additional PLN 4.2 billion margin between 2025 and 2027. The plan besides includes the redemption of investment certificates worth PLN 800 million and the usage of the stabilisation fund to cover losses – however, these decisions require the approval of the supervisory board.
Combat for key deposits of Dębieńsko coal
One of the biggest challenges for the JSW is to get a licence to operate the Dębieńsko coal deposit. The German company SCIGC, associated with HMS Bergbau, has precedence in this proceeding. According to the information provided by ‘Rzeczpospolita’, the current administrative procedure in the Ministry of Climate and Environment prevents JSW from submitting its own application.
The JSW intends to apply for a concession if SCIGC's application is rejected. Meanwhile, the German company already has approval, which puts JSW in a hard situation. The deficiency of access to Dębieńsko deposit importantly limits the company's ability to increase its mining and financial situation.
Record financial losses in 2024
In November 2024, JSW announced a net failure of PLN 315.3 million. The full mining sector in Poland recorded over PLN 9.2 billion in losses. The second 4th of 2024 was peculiarly hard erstwhile JSW wrote PLN 6.3 billion for failure of value of coal assets. Bogdanka took akin steps, which besides led to a deterioration in financial performance.
Although these write-offs may be reversed in the future, fresh increases in coal prices are not adequate to immediately improve the company's situation. The JSW authorities must face increasing competition on the marketplace and hard economical conditions in Europe.
A strategy for endurance in hard times
To address these challenges, JSW presented the strategical Transformation Plan. This paper assumes the restoration of the profitability of the mining section and the optimisation of operating costs. The precedence is to manage resources efficiently, reduce unnecessary expenditure and invest in modern mining technologies.
The uncertainty associated with obtaining the Dębieńsko deposit concession and expanding operating costs make the future of JSW uncertain. However, the determination of the company's authorities and clearly defined strategical objectives give hope of improving the situation in the coming years.
More here:
JSW is waiting in line for the Dębieńsko coal deposit. Germany has priority
