PERTH (miningweekly.com) – Metals miner Independence Group (IGO) has reported a 21% fall in revenue and a 23% fall in underlying earnings before interest, taxes, depreciation and amortization (Ebitda) for the quarter ended March as production declined.

Nickel production from the Nova operation declined from 7 024 t in the second quarter, to 6 816 t, while copper production declined from 3 171 t to 3 035 t.

Gold production at the Tropicana gold joint venture declined from 112 050 oz in the second quarter to 82 393 oz, as focus at the operation shifted to the Havana openpit cut back.

IGO on Wednesday reported that revenue for the third quarter ended March had declined from A$235.9-million to A$185.7-million, while underlying Ebitda declined from A$120.9-million to A$92.7-million.

Profits after tax increased by 378% on the second quarter, from A$8.8-million to A$41.9-million, and included A$23.5-million in foreign exchange gains arising from the revaluation of US dollar balances and financial instruments held at the quarter end for the purposes of protecting the Australian dollar equivalent of lithium transaction US dollar purchase prices.

“We are proud to deliver another strong set of operating and financial results for the March quarter, a period in which our operations continued to generate strong cash flows and we progressed the evolution of our portfolio to align with our strategic focus on clean energy metals,” said IGO MD and CEO Peter Bradford.

“Operationally, the Nova team continued to drive strong outcomes, with metal production for the quarter in line with guidance while cash costs continued to benefit from strong by-product pricing. Quarterly cash costs of A$1.83 per payable pound of nickel position Nova to be below the bottom end of cost guidance for the full year.”

For the full year, Nova is expected to achieve between 20 250 t and 21 750 t of nickel production, and between 8 250 t and 9 375 t of copper production at cash costs of between A$2.40/lb and A$2.80/lb.

“At Tropicana, higher waste movements and lower milled grade, a result of the continued investment in the cutback at the Havana openpit, resulted in lower quarter-on-quarter gold production and higher costs, as guided. Production and costs are both expected to finish 2021 within the guidance range.

“In parallel, we have progressed the transaction with Tianqi Lithium Australia announced in December 2020. The outstanding conditions precedent to settlement are expected to be completed in the coming weeks, and we remain confident that the transaction will close during the June 2021 quarter,” said Badford.

At the end of the quarter, IGO struck a A$903-million agreement with fellow listed Regis Resources to divest of its 30% interest in the Tropicana gold project.

“Tropicana has been an important part of IGO’s history and a key driver of our sustained growth. Tropicana is a high quality, tier-1 gold asset with strong upside potential, however, it is not aligned with our focus on commodities critical to clean energy and we are pleased to have maximised shareholder value through this sales process,” said Bradford on Wednesday.

The Tropicana project is expected to produce between 285 000 oz and 322 500 oz in the full 2021.