Despite record prices and demand for the mining industry, the industry’s profit margins may have peaked. A new report from PriceWatershouseCoopers (PwC) found that 2007 revenues for the world’s 40 largest mining companies rose by a third last year to $312 billion due to the strength of diversified companies and mining firms in emerging nations. However, costs for the top 40 companies increased faster, rising 38% due to energy, labor and other expenses. As a result, earnings before interest, tax, depreciation and amoritization (EBITDA) increased 25% to $136 billion, but EBITDA margin fell from 46% to 44%, and return on equity declined from 33% to 29%. PwC expects costs to remain high, even if prices decreased and firms will begin to reduce costs and put off production increases. Market capitalization for the leading 40 companies increased 54% in 2007. Source: Financial Times