A MINING firm says it is well positioned to spearhead the UK market’s long-term future, despite ongoing market volatility.

Hargreaves Services, in Esh Winning, near Durham City, revealed the optimism in its 2014 annual report, which showed underlying pre-tax profits increased 5.6 per cent to £55.1m for the year to May 31.

Underlying operating profits were 6.8 per cent higher at £59.5m, with revenue three per cent up at £869.2m.

Hargreaves supplies coke for SSI UK's Redcar blast furnace and wants to open more open-cast sites across the North-East to ease the country’s reliance on expensive foreign imports and counter rising energy costs.

Last month, the firm sold its Imperial Tankers chemical transport division to Suttons Group for £26.9m in plans to increase its presence in the UK coal industry.

It is also reviewing operations at Monkton, near Barnsley, which supplies steel and chemicals plants, after the mine’s operating profit slump, with Hargreaves expected to announce next year whether it has secured enough contracts to keep the 130-year-old plant.

Tim Ross, chairman, said: “We have developed to become the most successful and profitable coal operator in the UK.

“The UK coal and coke markets have continued to be volatile and uncertain, and international coal and coke prices are at their most depressed levels for many years.

“Although we are confident markets for coal will continue in the UK, the board has elected to take a proactive stance, which includes the sale of Imperial Tankers.

“While there remain challenges ahead, particularly due to the uncertain economic climate and its knock-on effects on the major coal users in the power generation and steel sectors, we believe the group’s resilience leaves it better positioned than any other coal operator to work through the volatility and support the sector in the longer term.”

Last year, Hargreaves also rescued hundreds of jobs after buying assets from collapsed surface mining firm Aardvark for £10.4m, with more than 200 Scottish workers offered contracts.

Mr Ross added: “All divisions performed robustly in the financial year, which was despite a slow start for our surface mining operations in Scotland, exacerbated by poor weather and by the impact of challenging coke markets on profits of the Monckton and German coke trading operations.”