JOHANNESBURG (miningweekly.com) – London-listed Kenmare Resources reported continued widening losses for the first half of the year as reduced production and a weak market battered its performance.
The company, which operates the Mozambique-based Moma titanium minerals mine, on Friday posted an operating loss of $27.2-million for the six months ended June, an increase on the $17.9-million operating loss reported in the prior corresponding period last year.
Kenmare’s gross loss for the period under review plunged to $18.1-million, compared with a gross loss of $1.6-million in the six months to June 2014.
“The decreases in gross profit and operating profit resulted from lower average prices and increased unit costs, due largely to reduced production caused by the power outages,” Kenmare said in an update to shareholders on Friday.
However, the group narrowed its net loss slightly from $31.8-million in the first half of 2014 to $27.9-million in the half-year under review.
The group recorded a loss before interest, taxes, depreciation and amortisation of $10.6-million in the period under review, compared with earnings before interest, taxes, depreciation and amortisation of $2.3-million in the first half of 2014.
Kenmare’s revenue for the period under review decreased to $73.9-million, from $81.2-million in the corresponding period last year, owing to an 18% reduction in ilmenite prices.
Total operating costs, including cost of sales and other operating costs, amounted to $101.1-million in the six months to June, marginally up on the $99.1-million recorded in the first half of 2014.
Cost control measures had resulted in significant cost savings, with total cash operating costs down 17% year-on-year to $69.1-million, as a result of lower plant availability and implemented cost control measures.
Kenmare’s net reported debt remained steady during the half-year under review at $317-million.
Meanwhile, Kenmare continued to work towards the satisfaction of the preconditions of Australian mineral sands miner Iluka Resource’s proposed buyout of the company.
Iluka had offered 0.016 Iluka shares for each Kenmare share.