Photo by: Bloomberg
PERTH (miningweekly.com) – Iron-ore miner Fortescue Metals has reported a 4% increase in production during the three months to September, compared with the June quarter, shipping 42.2-million tonnes of ore.
C1 cash costs for the first quarter of 2020 were up by 1% on the fourth quarter of 2019, to $12.95/t, but down by 2% on the previous corresponding period, while the average revenue received during the quarter reached $85/t, up 89% on the previous corresponding period.
“The Fortescue team has delivered a strong performance across all aspects of the business in the first quarter of 2020, building on our record results of 2019,” said CEO Elizabeth Gaines.
“Fortescue’s outstanding operational performance across mining, processing, rail and port delivered shipments of 42.2-million tonnes, a 5% improvement on the first quarter of 2019, at C1 costs of $12.95/t. Through the quarter, we maintained our enhanced product mix with strong demand for our range of products, including our 60.1% iron content West Pilbara Fines. This is reflected in Fortescue’s contractual price realization which averaged 89% of the benchmark 62% CFR index price during the quarter.”
Gaines said that the combination of operational performance and realised price had generated exceptional operating cashflows and lowered net debt to $0.5-billion at the end of September, providing Fortescue the capacity to further strengthen its balance sheet through debt reduction and refinancing of the term loan on improved terms.
Cash on hand increased to $3.4-billion at the end of the September quarter.
Looking to the full year, Fortescue has predicted iron-ore shipments to reach between 170-million and 175-million tonnes, with C1 costs estimated at between $13.25/t and $13.75/t.