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(Alliance News) - Rainbow Rare Earths Ltd on Monday said its interim loss narrowed due to lower depreciation expenses, despite a sharp decline in revenue from a drop in production.
Shares in Rainbow Rare Earths were 19% lower at 1.54 pence on Monday in London.
For the six months to the end of December, the rare earth element miner reported a pretax loss of USD1.8 million from USD3.1 million the year before, as the company's depreciation costs dropped to USD76,000 from USD1.7 million.
However, revenue declined sharply to USD156,000 from USD1.2 million, as production from its Gakara project in Burundi fell to 114 tonnes of concentrate from 564 tonnes year-on-year, reflecting operational challenges including equipment struggling in wet conditions, and a lack of geological information.
Looking ahead, Rainbow said that Burundi has had no officially recorded instances of the coronavirus, and as such results operations are running as normal. However, the company warned that operations could be disrupted should the government imposes stricter controls.
In addition, volatility in financial markets could hinder the company's ability to fundraise, making it harder to achieve certain development milestones.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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