Atlas Iron shares are smashed on the first day back

Atlas Iron shares fell hard after the miner resumed trading for the first time since April when the company couldn’t produce iron ore and make a profit.

The company lost 70% of its share value today when it came out of a trading halt imposed when the miner moved to mothball its mines.

Since then, the company has managed to strike agreements with its suppliers and cut costs enough to make it worthwhile digging up iron ore again.

However, last week the company managed to raise just $86 million in capital funding, well short of a $180 million target.

The cash raised from existing shareholders, contractors and new investors will give the miner further protection from volatile iron ore prices.

The miner is partly insulated from recent falls in the price of iron ore to around $US50 a tonne.

The company says its has forward sold tonnages over the current quarter, the September quarter (about 70% of expected output) and about 10% of sales in the December quarter.

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