Q3 Cobre Sales (US $2.036M) Sets New Record

RNS Number : 1125T

Strategic Minerals PLC

10 October 2017

 

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10 October 2017

Strategic Minerals plc

("Strategic Minerals" or the "Company")

Q3 Cobre Sales (US $2.036M) Sets New Record

Strategic Minerals plc (AIM: SML; USOTC: SMCDY), the diversified mineral development and production company, is pleased to provide the following update on magnetite ore sales at the Company's Cobre operations in New Mexico, USA, for the three months to September 2017, and to inform the market of cash available at the end of quarter. 

The Board has reviewed both the previous quarterly reports and the timely manner in which it has reported on project specific developments and has taken the view not to revisit previous progress in the quarterly report but to instead comment on the two key pieces of information that require updating (Cobre sales and cash balances). In this manner, the reports can be produced more efficiently.

Sales update Cobre magnetite tailings operations                                                                                                  

The spectacular September 2017 quarter sales at Cobre of US $2.036m (29,539 tons) have set a new quarterly record, partly reflecting clearance of prepaid June tonnage for our new client. Accordingly, the figures for this September quarter are approximately 15% higher than current underlying sales. Notwithstanding, these sales levels represent over a 300% increase on last September's sales of US $0.462m (7,686 tons). On the back of this performance, the Board anticipates that 2017 will see the company record its first profit in excess of US $1m.

The September 2017 quarter sales set a record for quarterly domestic sales with sales and volumes details as follows:

	Tonnage		Sales (US $'000)
Year	3 months to Sept	12 months to Sept	3 months to Sept	12 months to Sept
2017	29,539	63,681	2,036	4,032
2016	7,686	23,477	462	1,533
2015	3,583	13,960	250	946

The management at Cobre has not only been able to increase sales but also increase profit margins at Cobre to in excess of 60% for the September 2017 quarter. The Board and Management considers that, on the basis of current sales, this profit margin can be maintained throughout 2018 and that annual sales are likely to exceed US $5m.

Financials and Operations

Over the period, the parent entity continued to maintain a tight control on overheads which remain, on an annualised basis, under US$1 million (excluding variable project review costs, foreign currency movements and non-cash adjustments).

With sizeable cash flows, and after meeting exploration costs associated with both Redmoor and Hanns Camp, the Company has a healthy cash balance, which at 30 September 2017 was US $1.627m (30 June 2017: US $1.359m).

 

Commenting, John Peters, Managing Director of Strategic Minerals, said:

"The September quarter has seen the expectation of profits and cash flow from our Cobre operations begin to materialise. As the Company is now cash generative, we look forward to being able to leverage this comfortable financial position to further improve shareholder value through self-funded drilling programmes and acquisitions via joint ventures and corporate activities.

"This year has marked a substantial turnaround in the Company's fortunes and, with the continued support of our very loyal shareholders, the Board and Management look forward to driving the Company onto its capitalisation (£100m) and share price (5.75+ pence) targets."

For further information, please contact:

Strategic Minerals plc		[phone]
John Peters
Managing Director
www.strategicminerals.net
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Notes to Editors

Strategic Minerals Plc is an AIM-quoted, diversified mineral development and production company with projects in the United States of America, the UK and Australia. The Company is focused on acquiring and developing cash generative, high quality projects which meet local market demand for commodities and utilising this cash flow to undertake value added exploration. 

In September 2011, Strategic Minerals purchased its first cash-generating asset; the Cobre magnetite tailings dam project in New Mexico, USA which it brought into production in 2012 and which continues to provide a revenue stream for the Company. The portfolio was expanded in January 2016 with the acquisition of shares in Central Australian Rare Earths Pty Ltd, which holds tenements in Western Australia and the Northern Territory that are prospective for cobalt, gold, nickel sulphides and rare earth elements. The Company has since acquired all shares in Central Australian Rare Earths Pty Ltd. In May 2016, an additional exploration asset was acquired when the Company entered into an agreement with New Age Exploration Limited to acquire up to 50% of the Redmoor Tin/Tungsten project in Cornwall, UK. This 50% acquisition has now been completed and drilling at the project has commenced.

 

END

 

 

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