13 Jan 2015 07:00
AIM: FOX 13 January 2015
FOX MARBLE HOLDINGS PLC
("Fox Marble" or the "Company")
Pre-close Statement
Fox Marble, the AIM listed company focused on marble quarrying and finishing in Kosovo and the Balkans region, is pleased to provide an update to the market ahead of its results for the financial year ended 31 December 2014.
Operational Highlights
· Confirmed orders to date for 2015 for a minimum of €1.5m.
· 2014 reported sales expected to be around €150K, with much of the existing 2014 order book pushed into H1 2015.
· Over 14,000 tonnes of marble were extracted during 2014.
· Strategic long term relationships entered into with Marmi E Graniti D'Italia S.r.I ("MGI"), Banyan Stone Limited ("Banyan"), Zhong Shengdestone Co.,Ltd ("ZSC") during Q4 2014, complementing existing Pisani offtake and distribution from 2013.
· Sales agency agreement with ZSC signed in December 2014 with minimum quantity of 10,000 tonnes per annum. Any proceeds from this are not included in the confirmed orders to date for 2015 highlighted above.
· December 2014 offtake agreement with Banyan provides for a minimum commitment of €1.5m of block marble over the next 18 months.
· 300 tonnes of marble already shipped since offtake with MGI in October 2014 with a value of €90k.
· Product continues to be sold via Company's office in Carrara and its distributors in London (Pisani) and New York (Royalstone). Confirmed or completed orders under the Pisani offtake agreement currently totalling over €250k.
· Factory building purchased and shipped to the Fox Marble site in Kosovo under budget during 2014. The steel framework has been erected with completion of the building expected and commencement of operations now in Q1 2015.
· Further partnership agreements are being discussed in the Middle East and India.
Financial Highlights
· Fox Marble raised £4.75m in August 2014 in order to acquire further resources of Sivec marble in Macedonia and Illyric White in Malesheva in Kosovo and to equip those new quarry sites.
· Cash reserves as at 31 December 2014 were €4.7m.
Despite unusually adverse weather in Kosovo during the year, Fox Marble has continued to successfully develop its quarries, which are now producing quality marble in large compact stone block sizes in Rahovec (grey, red and flora marble), Syrigane (Breccia Paradisea marble) and in the joint venture Sivec quarry site in Macedonia.
In order to meet increasing demand, Fox Marble has invested in further quarrying equipment in the year. The Company has also procured two large chain saws to be deployed to the quarries to substantially increase production in 2015. The first of these will be delivered in January 2015.
Sales for 2014 were lower than originally estimated as it has taken longer than anticipated to crystallise a number of potential transactions and offtakes. However, Q4 of 2014 saw significant progress with Fox Marble entering into a number of material contracts. As these were executed towards the end of the year the impact of these contracts will only be reflected in the Company's 2015 numbers. Confirmed orders to date for 2015 currently stand at €1.5m of block and slab marble, while the sales agency agreement with ZSC for a minimum of 10,000 tonnes per annum has provided Fox Marble with exposure to the dominant Chinese market for the first time and is expected to lead to significant incremental revenues for 2015.
In addition, the agreement with MGI signed in October 2014, which stated a minimum quantity of 100 tonnes per month of Fox Marble's grey, red and breccia stones over a two year period, has also now started with over 300 tonnes of marble shipped to date.
Fox Marble anticipates that its order book will now grow at an increasing rate as existing and new distribution channels are developed further, sample delivery is executed and orders are sought. This process will be further aided by the fact the Company now has a sizeable and varied inventory of marble for potential customers to review, a requisite for most buyers.
One of the key objectives for Fox Marble in 2015 will be to achieve full production at the quarries at Malesheva and Prilep. The marble from these areas is in very high demand and scarcity elsewhere in the world should ensure it commands a significant premium to some of the more readily available marble in the Company's portfolio.
The Company's factory is under construction and, despite unexpected adverse weather conditions, the skeleton frame of the building has been completed. It is now anticipated that the factory will be completed and operational by the end of Q1 2015. This long-awaited factory will open up a number of important new sales channels for the Company and provide a further boost to the economics, given the high margin nature of the cutting and polishing industry for marble.
Chris Gilbert, CEO, commented: "In what has remained a challenging environment for smaller listed companies, Fox Marble has entered 2015 in good shape. Whilst clearly the Company would have preferred to have realised higher sales figures in 2014, the sales outlook for 2015 is much more robust. We are encouraged by the strong finish to the year in terms of deferred income, signed offtakes and sales agency agreements. The planned completion of construction of the factory at the end of this quarter should further boost the economics and profitability of the Company in 2015.
"We have expanded our reach into China and South East Asia over the last year, building on the existing networks into North America and Europe. The Company will look to continue to expand on these relationships, while establishing partnerships in other jurisdictions, most notably the Middle East and India.
"2015 will be an important year for Fox Marble and I look forward to updating the market in due course."
For more information on Fox Marble please visit www.foxmarble.netor contact:
Fox Marble Holdings plc | |
Chris Gilbert, Chief Executive Officer | Tel: +44 (0) 20 7380 0999 |
Fiona Hadfield, Chief Financial Officer | |
Cairn Financial Advisers LLP (Nomad) | |
Avi Robinson / Liam Murray | Tel: +44 (0) 20 7148 7900 |
| |
Fox Davies Capital Limited (Broker) | |
Jonathan Evans | Tel: +44 (0) 20 3463 5000 |
Yellow Jersey PR | |
Dominic Barretto Kelsey Traynor | Tel: +44 (0) 77 6853 7739 Tel: +44 (0) 77 9900 3220 |
Notes to Editors
Fox Marble Holdings Plc is an AIM quoted natural stone extraction and production company operating in Kosovo and the Balkans region, with headquarters in the United Kingdom.
Established in 2011, Fox Marble has access to over 300 million cubic metres of premium quality marble and completed a maiden JORC resource indicating an in-situ valuation of approximately Euro 16.5 billion. As announced in October 2013, it now has four quarries in operation and in August 2014 it completed the acquisition of the Prilep Omega Sivec Quarry, thus increasing its exposure to the highly desirable Sivec marble.