JOHANNESBURG (miningweekly.com) – Mineral sands producer Sierra Rutile has increased its production of rutile for the six months ended June 30, by 8%, from 51 985 t in the first half of 2013, to 56 060 t.

The group further posted a 34% increase in rutile sales volumes from 53 446 t to 71 565 t over the same period.

Looking to financials, Sierra’s revenue of $64.1-million in the first half of 2014 was in line with the first half of the prior year’s $66.4-million, despite lower market pricing, while earnings before interest, taxes, depreciation and amortisation fell from $13.5-million in the first half of 2013 to $8.7-million in the period under review.

The company, meanwhile, achieved an 18% drop in direct operating costs from $586/t to $481/t – below full-year guidance of $490/t – despite a lower weighting of first-half production.

Sierra also posted a 24% reduction in total operating cash costs to $609/t.

"We are pleased with the performance in the first half. Despite the lower weighting of first-half production, the continued focus on unit cash costs has resulted in a strong cost performance from the operations. 

“The company has seen good demand for its products and sales volumes for the period were at record levels, albeit at subdued prices, providing us with confidence for the rest of the year,” commented CEO John Sisay.

During the first half of the year, the group repaid $6.1-million in principal and interest on the unsecured loan from the Sierra Leone government, leaving the outstanding balance at the end of June at $24.7-million. 

“The remainder of the loan will be repaid in six-monthly instalments through to December 2016. The next repayment is due in December and will include a principal payment of around $4.9-million and accrued interest of $1-million,” said the company.

Sierra, meanwhile, invested $3.9-million in the upgrade to the mineral separation plant, in Sierra Leone, with commissioning expected in the second half of the year.