Photo by: Bloomberg
PERTH (miningweekly.com) – Iron-ore miner Atlas Iron on Friday announced that it had become net cash positive following the end of the September quarter with some A$93-million cash on hand and a further A$21-million in its reserve account.
MD Cliff Lawrenson told shareholders that the transition to a net cash status provided more strong evidence that the re-shaping of the company was advancing rapidly.
“This turnaround in our balance sheet encapsulates the progress we have made in restoring Atlas’ financial and operational position since the restructure. During the quarter, we repaid the final installment of the A$22-million in royalty relief provided by the Western Australian government in 2015.”
Lawrenson said that the company’s operations also performed strongly during the quarter, generating net cash flow of A$15-million.
However, high discounts for low-grade product were likely to impact the December quarter results, so Atlas was maintaining a focus on cost control, Lawrenson said.
During the three months to September, Atlas shipped 3-million tonnes of ore, compared with the 3.1-million tonnes shipped in the June quarter, with C1 cash costs reported at A$37/t, compared with the A$36/t in the previous quarter.
The miner said on Friday that the C1 cash cost increase was owing to higher haulage costs as a result of the higher proportion of volume from Mt Webber, with its increased distance from the port.
Lawrenson noted on Friday that the changing shape of Atlas was also demonstrated by the resumption of exploration activities on a number of fronts, adding that the company was aiming to unlock all the value in its landholding, which includes lithium, copper and gold potential, in addition to the iron-ore assets.
“As part of this strategy, we also started exploring for lithium targets at our Pancho prospect and investigating opportunities in the emerging conglomerate Pilbara gold story.
“With each quarter, we are making solid progress in our over-arching plan to strengthen Atlas’ financial position, maximise its opportunities and pursue new growth prospects.”