Ebola leads to profit losses at London Mining: Iron ore producer London Mining has reported widening first-half losses and warned that the deadly Ebola virus could hit its production in the second half of the year.
· 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
· 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 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 e
we will see 41.00 or 39.00 share price first, I don't know. We should wait for a positive RNS to be released then I'll have an idea of which I will see first. What do you guys think we will see first? LOND will either be successful or it wont. If successful, LOND may or may not reach a 52 week high, it could also reach a 52 week low. Only time will tell if I am right.
Point taken, but its a two way street. I haven't posted over 1100 posts of de ramping dribble on other boards. If you don't like it put me on filter, I'm sick and tired of Dean the Village Idiot. Dean does 0% research on any companies hence he is a dreadful trader.
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