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Mount Gibson Iron announces December 2018 half-year financial result

Mining News - Published on Mon, 25 Feb 2019

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Mount Gibson Chief Executive Officer, Mr Peter Kerr, said that "The Mount Gibson team has delivered a solid operating and financial result during the half-year period. Our Mid-West business, from which the final shipments are shortly to be completed, was well-operated in the period to enable the Company to achieve a solid increase in gross profit from operations. "Group net profit after tax totaled $45.1 million for the half-year, compared with $80.0 million in the prior corresponding half when operational earnings of $15.7 million were supplemented by $64.3 million in settlement proceeds from the Koolan Island business interruption insurance claim. This recent performance ensures the Company remains in a very strong position as our business focus shifts back to the high-grade Koolan Island mine in the Kimberley region. First ore sales are now scheduled to occur in April following some minor mining delays in recent weeks, and we maintain our full year production guidance. Importantly, the pricing and outlook for Koolan's high grade iron ore remains significantly better than our base case assumptions, giving Mount Gibson a solid base from which to create significant long term value for shareholders."

1. Net profit after tax of $45.1 million (1H 2017-18: $80.0 million, which included $64.3 million from the proceeds of the Koolan Island business interruption insurance settlement).

2. Total product sales of 2.2 million wet metric tonnes (Mwmt) (1H 2017-18: 1.7 Mwmt), for sales revenue of $177.4 million CFR, including shipping freight (1H 2017-18: $117.0 million).

3. Cash, term deposits and liquid investments of $431.0 million at 31 December 2018, a reduction of $26.5 million in the half-year, arising from net operating cashflows and interest of $57.3 million,
Koolan Island expenditure of $65.5 million and $18.3 million in cash dividends paid in October 2018.

4. Mid-West site cash costs* of $37/wmt FOB (1H 2017-18: $42/wmt) and Group all-in cash costs* of $40/wmt FOB (1H 2017-18: $46/wmt), both below guidance.

5. Iron Hill mining, processing and railing completed, with the final Mid West shipments expected to occur in February 2019.

6. Koolan Island Restart Project pre-production activity nearing completion, and mining of high grade ore about to commence. Koolan ore sales to commence in April 2019 following minor recent mining interruptions.

7. Sales guidance for 2018/19 unchanged at 2.7-3.3 Mwmt, including 0.7-1.0 Mwmt from Koolan Island, at an average all-in Group cash cost* of $52-57/wmt FOB.

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Posted By : Rabi Wangkhem on Mon, 25 Feb 2019
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