Anglo Pacific sees strong growth in year ahead
JOHANNESBURG (miningweekly.com) – Dual-listed Anglo Pacific Group on Wednesday reported a “very strong performance” for the first quarter ended March 31, highlighting that it received royalty income of £10-million during the period, up from £1.9-million in the same quarter last year.
“Combining our royalty income of £7.5-million with the £2.5-million from our Denison financing agreement resulted in this total contribution,” the LSE- and TSX-listed company said in a statement, adding that this firmly supported its view that this year would see significant organic growth for Anglo Pacific.
Higher coal prices drove the near 300% increase in royalty revenue, with the average price from the Kestrel coal mine, in Queensland, more than double that of the first quarter in 2016 and the Narrabri operations, near the eponymous town in New South Wales, being 56% higher.
In addition, revenue from Maracás Menchen mine, in Brazil, increased significantly in the period to £400 000 as a result of recent record operational performance and a near doubling in the vanadium price.
The company added that the first quarter was also expected to be its lowest quarter in terms of sales volumes from Kestrel and Narrabri during the year. “Importantly, this is also the last time that we expect any material production from Kestrel to be outside of our royalty land for the foreseeable future.
“It is our view, that higher coking coal prices will now prevail for longer in 2017. With Kestrel's operations reportedly unaffected by weather events, we now anticipate an even stronger year of growth for Anglo Pacific than at the time we reported our 2016 results.”
Total free cash flow generated in the period is £13.4-million, compared with £3.3-million in 2016, with net debt at March 31, of £6.5-million, post the funding of the Denison financing and streaming agreement and 2016 interim dividend.
“We expect to be debt free by mid-2017,” Anglo Pacific added.
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