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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
London Mining | LSE:LOND | London | Ordinary Share | GB00B1VZK334 | ORD 0.2P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 4.70 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMLOND
RNS Number : 6787P
London Mining Plc
21 August 2014
London Mining Plc
Quoted on London AIM (LOND LN)
("London Mining" or the "Company")
21 August 2014
FINANCIAL RESULTS FOR THE HALF YEAR ENDED 30 JUNE 2014
Managing a high quality asset with long term credentials during challenging times
Highlights
Operations
-- Production volumes up 24% year on year to 2.1Mwmt -- Export volumes up 5% year on year to 1.7Mwmt with logistics upgrades performing well
-- Ramp up to an annualised rate of 5.4Mwmt/a with debottlenecking and optimisation delivering additional volume
-- Unit operating cost of USD 57/wmt, flat year on year, with cost under USD50/wmt achieved in June
Financial performance
-- Revenue of USD 110.6 million, down 22% as 5% increase in sales volumes offset by lower market prices
-- Marampa EBITDA profit of USD 0.8 million, a decrease of USD 38.5 million from H1 2013 (EBITDA profit of USD 39.3 million)
-- Group EBITDA loss of USD 10.8 million, an increased loss of USD 34.8 million from H1 2013 (EBITDA profit of USD 24 million)
-- Loss for the period of USD 12.6 million, an increased loss of USD 7.6 million from H1 2013 (loss of USD 5.0 million)
-- USD 32 million cash as at 30 June 2014
Measures taken to maintain liquidity in weak pricing environment
-- Non-essential capex of over USD 20 million for 2014 deferred until market conditions improve or the strategic partner process is successfully completed
-- USD175 million of "Life of Mine" extension capital programme to be deferred for two years by prioritisation of mining and processing of weathered ore through modified plant
-- Cost reduction programme delivering 20% lower cash corporate costs year on year with further cuts targeted
-- USD 37 million in offtake facilities with Cargill and Vitol with optionality on long term unallocated production preserved
-- USD 25 million working capital facility agreed with existing secured lenders post period end
-- Hedging programme realised a gain of USD 11.2 million
Production guidance
-- Production guidance range narrowed to between 4.9 and 5.1Mwmt/a (from 4.9 and 5.4Mwmt) as a result of slower than expected ramp-up and expected impact of Ebola
-- Operating cost of around USD50/wmt expected for full year plus up to USD1/wmt from Ebola related costs
Strategic partner process
-- Process to secure a substantial investment by a strategic partner in London Mining to reduce debt and fund future capital expenditure is progressing
-- Several non-binding expressions of interest have been received following due diligence -- Process expected to be concluded by end of 2014
Graeme Hossie Chief Executive of London Mining said: "There is no doubt the first half of 2014 has been a challenging one for the iron ore industry, Sierra Leone and indeed London Mining. We have been resolutely focused on four things - improving liquidity, completing the ramp-up to 5.4Mwmt/a, reducing costs and keeping our employees safe, healthy and protected from the Ebola virus.
Marampa has over one billion tonnes of resources which underpins a long life, high grade, scaleable iron ore mine and our progress in developing it to its long term potential, has been substantial. The plant is operating at an annualised rate of 5.4Mwmt and the unit operating cost has remained flat due to an extended commissioning of the plant upgrades and increased mining activity to ensure improved performance through the wet season. The increased liquidity we have attained gives us the headroom we need to continue operating in this low price environment until the anticipated completion of the strategic partner process by the end of 2014.
While production has not been impacted by the outbreak of the Ebola virus to date, post the period end we have begun to experience disruption to the supply chain and to a number of services as we optimise the plant beyond its nominal run rate. As a result of a slower than expected ramp-up and Ebola we have narrowed our 2014 production guidance to the lower end of the range, based on the current expected level of Ebola-related impact. We continue to be vigilant about keeping our employees healthy and are working closely with the Sierra Leonean government and health agencies in this difficult time.
Despite these challenges, the long term potential of Marampa remains. Good interest has been received from potential strategic partners with whom the Company is discussing a substantial investment to enable us to reduce risk, fund mine extension capex and potentially expand to larger scale production at the right time in the cycle. We expect the process to complete before the end of 2014."
Earnings Summary
Period ended 30 June USD'000 2014 2013 EBITDA (continuing operations) (10.8) 24.0 Marampa, Sierra Leone 0.8 39.3 Greenland (0.4) (0.3) Saudi Arabia - (0.1) Corporate - excluding non-cash share-based payments (8.1) (10.1) Corporate - share-based payments (3.1) (4.8) Depreciation and amortisation (18.5) (13.8) (Loss)/ profit from operations (29.3) 10.2 Fair value gain (Blackrock royalty agreement) 32.1 10.5 Net finance charge (26.8) (25.7) Taxation credit 11.4 2.1 Net loss after tax (continuing operations) (12.6) (2.9) Result from discontinued operations - (2.1) Loss for the period (12.6) (5.0)
The full operations and financial review, as well as the company's presentation of the period can be found here: http://www.londonmining.com/investors/reports-and-presentations/
Webcast and conference call
There will be a webcast and conference call for analysts and investors hosted by Graeme Hossie (CEO), Benjamin Lee (CFO) and Jim North (COO) at 09:00am BST today.
The presentation will be available via a live and on-demand webcast, a link to the audio webcast can be found on London Mining's website here: http://www.londonmining.com/investors/reports-and-presentations/.
The webcast will include audio from the conference call. You will not be able to post questions through the audio webcast. Please use the following numbers and Conference ID to dial in to the conference call:
International dial-in +44(0)20 3427 0503 UK Toll Free 0800 279 4992 USA Toll Free 1877 280 2342 Confirmation code 7603529
For more information, please visit www.londonmining.com or contact:
London Mining Plc Graeme Hossie, Chief Executive Officer Benjamin Lee, Chief Financial Officer Thomas Credland, Head of Investor Relations +44 (0)20 7408 7500 Liberum Capital (Nominated Adviser/Broker) Richard Crawley / Tom Fyson +44 (0)20 3100 2000 J.P. Morgan Cazenove (Broker) Ben Davies / Ignacio Borrell +44 (0)20 7742 4000 Brunswick Group LLP Carole Cable / David Litterick +44 (0)20 7404 5959
About London Mining
London Mining is an expanding producer of high specification iron ore concentrate for the global steel industry and is focused on identifying, developing and operating sustainable mines. London Mining commenced production from its 100% owned Marampa Mine in Sierra Leone in 2011, producing 3.4Mwmt/a in 2013 and plans to expand the mine to a capacity of 6.5Mwmt/a. Marampa has sufficient resources to support a staged expansion to 20Mwmt/a. London Mining has also completed bankable feasibility studies outlining plans for a further 20Mwmt/a of iron ore production by developing mines in Greenland and Saudi Arabia. The Company listed on AIM in London on 6 November 2009. It trades under the symbols LOND.L (Reuters) and LOND LN (Bloomberg). More information about London Mining can be found at www.londonmining.com.
This information is provided by RNS
The company news service from the London Stock Exchange
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