Kenmare H1 revenues flat amid subdued prices, weak market conditions
JOHANNESBURG (miningweekly.com) – London-listed Kenmare Resources’ revenue for the six months ended June 30, remained flat at $81.2-million, as increases in sales volumes were offset by lower prices and weak market conditions.
During the period under review, the company lifted its ilmenite, zircon and rutile sales 36% to 399 000 t; however, average realised prices declined 23% for ilmenite and 7% for primary zircon.
Meanwhile, Kenmare’s heavy mineral concentrate production increased 26% to 604 200 t in the six months, while ilmenite output was up 47% and zircon production up 12% to 445 600 t and 21 400 t respectively.
Total operating costs, including the cost of sales, rose to $99.1-million, up from $72.4-million in the prior corresponding period; however, the company reduced its cash production cost per tonne of finished product by 14%.
Kenmare posted an operating loss for the period of $17.9-million, compared with a $6.9-million operating profit during the prior corresponding period, while also widening its net loss to $31.8-million, compared with the net loss of $10.2-million in the first half of 2013.
“A significant proportion of global production is struggling to cover cash operating costs, before debt service or return on capital. This is an unsustainable situation.
“Although there have been some production cuts, these have been negated by new supply coming on stream, which was incentivised by previously high prices and these new volumes are delaying a recovery in prices,” Kenmare MD Michael Carvill pointed out.
He added that Kenmare had made substantial progress in reducing unit costs, conserving cash and improving production.
“We expect results for the full year to benefit from a more favourable sales mix, increased volumes and targeted cost reductions,” he said.
Carvill further noted that the company had recently concluded an agreement with lenders, which provided Kenmare with greater financial flexibility during the currently subdued pricing environment.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation