Rare Earths Global Limited Trading Update (6367Y)

TIDMREG

RNS Number : 6367Y

Rare Earths Global Limited

26 February 2013

 
 Press Release   26 February 2013 
 

Rare Earths Global Limited

("REG" or the "Group")

Trading Update

Rare Earths Global Limited (AIM: REG), a leading mining services group focused on the extraction, separation, refinement and trading of rare earth elements, oxides and other related products, today announces the following trading update.

As outlined in the Group's Interim Results on 25 September 2012, the Rare Earth industry both domestically in the People's Republic of China ("PRC") and internationally is going through a period of rapid change and development. The uncertainty this has caused, coupled with a fall in rare-earth prices (up to 60% since the beginning of 2012), has meant that REG will not meet market expectations for the financial year ended 31 December 2012 and as a result expects to report a normalised loss for 2012.

The change in the PRC Government, the Chinese White Paper on Rare Earth and subsequent statements from The Ministry of Commerce ("MOFCOM") in 2012 (which are detailed in the Group's Interim Results) have created significant uncertainty in the PRC and their implications with regard to rare earth production and exports continue to be interpreted. This uncertainty has lead to significant delays in REG receiving its production quota and not receiving an export quota at all in 2012. This has severely hampered the ability of the Group's separation plant and trading divisions to carry out its strategy. In addition, given the current uncertainty, the Board has not been able to progress its discussions with Credit Suisse regarding its proposed US$50 million debt facility.

The Board continues with the strategy as set out at the time of the Company's flotation on AIM which now includes numerous potential opportunities regarding possible joint ventures which would provide the optimum approach to carrying out this stated strategy. A further update will be made to the market in due course.

The Board continues to believe that the demand for Rare Earth Oxides ("REOs") for new applications will continue to increase and in absolute terms both domestic and international global demand will return to previous levels. Coupled with increasing regulation and control of production both domestically and internationally the Board believes that the long term outlook for the price of REOs (and more specifically Heavy Rare Earth Elements) is positive.

The Group plans to issue its Preliminary Results for the year ended 31 December 2012 by the end of May 2013. A notice of results will be issued in advance.

- Ends -

For further information:

 
 Rare Earths Global Limited 
 Simon Ong, Chief Executive Officer     Tel: [phone] 
 Brian Ho, Finance Director           www.rareearthsglobal.com 
 
 
 Charles Stanley Securities 
 Nominated Adviser & Broker 
 Dugald J. Carlean / Carl Holmes   Tel: [phone] 
                                       www.csysecurities.com 
 

Media enquiries:

 
 Abchurch Communications Limited 
 Henry Harrison-Topham / Joanne    Tel: [phone] 
  Shears 
 [e-mail]          www.abchurch-group.com 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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