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LONDON (Alliance News) - Bushveld Minerals Ltd's revenue and earnings soared in 2018, the company said Wednesday, despite missing production guidance.
Shares were down 5.0% on Wednesday at a price of 38.70 pence each.
Revenue for the vanadium producer, which owns the Vametco, Brits, and Mokopane projects in South Africa, surged to USD192.2 million, more than double the USD79.2 million recorded in 2017.
Bushveld's earnings before interest, tax, depreciation, and amortisation more than quadrupled to USD107.5 million from USD23.9 million.
The steep increases were due to higher vanadium prices. The average price of ferrovanadium in 2018 was USD81.2 per kilogramme, well over double year-on-year. Vanadium is used to strengthen steel.
However, Bushveld's 2018 production was 2,560 metric tonnes, down slightly from 2,649 metric tonnes in 2017. This was also short of guidance, which stood in the range of 2,600 metric tonnes to 2,650 metric tonnes.
Bushveld blamed the shortfall on unplanned maintenance and repairs in the fourth quarter.
In the fourth quarter, revenue rose 33% on the third quarter to USD60.2 million, and Ebitda 66% on the quarter to USD39.6 million.
Fourth quarter vanadium output was 657 metric tonnes, 22% higher quarter-on-quarter and also 22% higher year-on-year.
Looking ahead, Bushveld expects production in 2019 to increase year-on-year having started a transformation programme. More detailed guidance will be given during the first quarter of 2019.
On the exploration front, Bushveld has received all assays for phase one of its exploration at Brits, all of which have either met or beaten expectations. It hopes to have a maiden resource estimate in the second quarter of 2019.
The company gave no information on a future dividend policy, nor a listing on the Johannesburg Stock Exchange, both of which the company had said it is working on.
Chief Executive Fortune Mojapelo said: "The strong vanadium market ensured Vametco generated healthy cash flows, even while its operational performance fell below expectations.
"We are benefiting from the high vanadium prices, nevertheless, we are mindful of the imperative to drive Vametco towards operational excellence and realise its true potential. The transformation programme we have initiated at Vametco is designed to do just that and we are confident to see an improved production performance during 2019."
