Photo by: Bloomberg
PERTH (miningweekly.com) – Iron-ore miner Atlas Iron on Thursday reported a record quarter of production, with the miner shipping 3.9-million tonnes of ore during the three months to March, a 7% increase on the previous quarter.
Ore mined for the quarter increased by 9% on the previous quarter to 3.82-million tonnes, while ore processed also increased by 6% from 3.4-million tonnes to 3.6-million tonnes during the same period.
C1 cash costs for the quarter declined by 8% on the December quarter, to reach A$33/t.
“The March quarter’s record performance provides further evidence of how Atlas and its shareholders stand to enjoy a brighter future following the successful execution of the planned corporate restructure,” said Atlas MD David Flanagan.
The company’s shareholders were expected to vote on a debt restructuring agreement later this month. The restructuring plan would see Atlas pay down $10-million of its term loan b (TLB) loan and issue shares and options to retire a further $132-million in debt, while also extending the maturity of the remaining $135-million from December 2017 until April 2021.
Meanwhile, Flanagan said that the company’s strategy to reduce costs in cooperation with its contractors and staff also continued to deliver strong results, as full cash costs during the quarter fell from the A$54/t reported in the three months to December, to A$49/t.
“Atlas stands to save another A$20-million a year in cash interest expenses as a result of the debt restructure and we continue to identify opportunities to reduce operating expenses.
“By roughly halving our debt and amending our banking covenants, the restructure will also strengthen our balance sheet significantly, giving the company far greater certainty and resilience.”
Flanagan added that Atlas would be better placed to endure future iron-ore industry volatility following the restructure, and to capitalise on future gains in the iron-ore price.
The miner had previously warned shareholders that it would likely face voluntary administration if the recapitalisation plan was not approved at the April 27 shareholder meeting.