(Alliance News) - Premier African Minerals Ltd on Monday reported a widened pretax loss on foreign exchange headwinds following new currency measures by the government of Zimbabwe.
In the six months to June 30, Premier African's revenue grew almost tenfold to USD1.5 million from USD166,000.
Its pretax loss widened heavily to USD17.9 million from USD1.5 million driven by the USD18.3 million in foreign exchange losses it incurred, compared to none last year.
In June, Zimbabwe, where Premier African operates, banned the use of foreign currencies, including the British pound, US dollar and South African rand.
Premier African Minerals explained that the country's real time gross settlement dollar, which was introduced by the government earlier this year, "devalued from the introductory rate" during the interim period and has depreciated since.
More positively, the company's administrative expenses fell 14% year-on-year to USD1.1 million from USD1.3 million.
Chief Executive George Roach said: "Whilst the financial strain on the company over the past six months has been substantial, the cost cutting and commitment from our entire company and consultants has been admirable."
The company operates the RHA tungsten mine in Zimbabwe where "work has commenced on electrification". Zimbabwe's National Indigenisation & Economic Empowerment Fund committed to the "provision of additional finance to continue the recommissioning process" at RHA, Premier African said.
The firm conceded however that a return to production at the facility is "taking longer than envisaged".
Premier African is also hoping to obtain an exclusive prospecting order to extend its tenement at the Zulu lithium project, also in Zimbabwe.
Roach added: "Zulu lithium is a large and high-quality asset and the current deposit is fundamentally sound, however the project requires the granting of the exclusive prospecting order to attract funding for the next phase of development."
Shares in Premier African were 35% higher at 0.032 pence each in London shortly before market close on Tuesday.
By Eric Cunha; ericcunha@alliancenews.com
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Premier African Minerals (PREM)