Kenmare returns to H1 profit

JOHANNESBURG (miningweekly.com) – Increased shipments, higher average received prices and lower unit costs have contributed to a turnaround in mineral sands miner Kenmare Resources’ earnings before interest, taxes, depreciation and amortisation (Ebitda) in the six months to June 30.

The miner, which operates the Moma mine, in Mozambique, on Tuesday posted Ebitda of $29.8-million for the six months under review, compared with a $10.7-million loss before interest, taxes, depreciation and amortisation in the first six months of 2016. 

Revenues rose 82% year-on-year to $102.4-million, while profits increased to $9.4-million, compared with a $47.1-million loss in the first half of the prior year.

Heavy minerals concentrate production increased by 18% year-on-year to 712 700 t in the first half of this year, compared with 606 100 t in the first half of 2016, while ilmenite production was up 25% year-on-year to 504 800 t, compared with 402 900 t in the prior comparable period.

Zircon production increased by 32% year-on-year to 37 700 t and rutile output increased by 47% year-on-year to 4 400 t.

Sales of finished products rose 21% year-on-year to 535 700 t in the six months to June 30, comprising 495 000 t of ilmenite, 36 700 t of zircon and 4 000 t of rutile.

Kenmare on Tuesday warned that its shipping capacity would be lower in the third quarter as one of its two transshipment barges is undergoing maintenance, which is required to be conducted every five years in compliance with marine classification regulations.

The barge will return to service during the third quarter and the maintenance is not anticipated to have a significant impact on shipping volumes for the full year.

Meanwhile, the company is assessing certain development options with a view to potentially reducing or deferring capital expenditure, while optimising production volumes.