LONDON (Alliance News) - Newly established building-materials company Fox Marble Holdings PLC Thursday said its operating loss widened in the recent full year, reflecting costs incurred in bringing its quarries into full production.
The company, which extracts marble in Kosovo, posted a pretax loss of EUR2.6 million for 2013, narrowed from a loss of EUR7.4 million in 2012. The prior-year pretax loss included a one-off non-cash accounting charge resulting from the conversion of pre-IPO loan notes.
At an operating level, however, losses widened to EUR2.2 million from EUR1.2 million due to costs incurred in bringing an additional three quarries into operation, as well as costs incurred in establishing a base of sales.
Fox Marble recorded a maiden revenue of EUR46,208.
The year under review was never expected to be profitable since the company's main goal was to get its quarries into production, rather than maximising sales. Sales have been delayed due Fox Marble focusing instead on acquiring additional quarries and broadening its product range. Consequently quarry development has taken longer than expected.
However, Fox said it has started to extract blocks of high quality marble at some of its newly opened sites, and last year it entered into an operating agreement for a quarry in Prilep, Macedonia which provides it with the highly sought-after Sivec marble.
Blocks from its four quarries have been cut and polished at its short-term facilities in Carrara, Italy and are available for sale. The facilities in Carrara have allowed Fox to cut and polish marble ahead of opening its own production facilities in Kosovo.
The company Thursday said it has now acquired a processing factory from a site in Greece, which is now being erected at its factory site in Kosovo. Construction, scheduled for completion by the end of the second quarter, includes the laying of a concrete floor on which the specialist marble processing equipment will be sited. Fox Marble has now started to acquire the necessary equipment needed to process the marble.
During the construction period and until the processing factory is operational, Fox Marble said it will maintain and extend the third-party production facilities it has secured in Carrara in order to fulfil orders of cut and polished marble slabs.
Financially, Fox Marble said it remains in a good position with net cash of EUR5.3 million, down slightly from EUR7.1 million a year before. It will use this to fund capital expenditure and operating costs, while its sales build to a sustainable level.
The company does not anticipate payment of dividends until the operations become significantly cash generative. However it said it intends to adopt a "progressive dividend policy when it becomes commercially prudent to do so".
The stock was trading at 18.20 pence, down 2.9%.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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