The UK's largest coal producer is embarking on a programme of property sales, after discovering its land bank is worth almost twice what the firm had thought.

RJB Mining has said it has begun "actively managing" its land portfolio after surveyors said the assets were worth �95.1m after clean up and preparation costs.

In its accounts, RJB had estimated the land to be worth �50.9m.

"We intend to maximise returns on all our assets... by developing those sites where value can be added at minimal risk, and disposing of land that is surplus to requirements," chairman John Robinson said.

Coal sales

He also forecast strong coal sales, thanks largely to the rising cost of competitor fuels, such as gas, and a reduction in output from the UK's nuclear power stations.

"The coal market is in better shape than for some time," Mr Robinson said. "Demand over the next few years is strong."

But it was only after receiving government aid of �53.3m that the firm was able to report profits of �17.8m for the year to end of December.

Coal sales from UK mines eased by 1.7%, with production sliding 15% to 19.1 million tonnes, the firm's annual results statement said on Tuesday.

Wet weather

Output was affected by development work at the Ellington and Clipstone, and the wet weather which swept the UK last autumn.

"Heavy and prolonged rainfall affected the majority of surface mine sites, reducing production and resulting in increased operating costs... where action needed to be taken to prevent flooding."

RJB, which spent �11.2m implementing redundancy programmes last year, said it is determined to increase productivity further in an effort to secure a place in the sector's world stage.

"Our focus continues to be on unit cost of production so that we are competitive with international coal," Mr Robinson said.

Profitability at the firm's Australian subsidiary, CIM Resources, was hit by weak Asian demand.

City reaction

In the City, RJB stock stood unchanged at 82p in early trade on Tuesday.

The shares, which closed at 27.5p on 6 March last year, have been one of London's better recent performers, and were boosted by takeover speculation last summer

The shares topped 580p in May 1996.