PERTH (miningweekly.com) – Higher nickel prices have boosted the bottom-line for producer Western Areas during the full year ended June, despite a decrease in both production and sales for the 12 months under review.
ASX-listed Western Areas on Tuesday reported that sales revenue for the full year ended June had increased to A$308.4-million, up from the A$268.7-million reported in the previous financial year, despite production falling from 21 700 t to 20 900 t, and sales falling from 21 500 t to 19 900 t.
Net profit after tax reached its highest level in seven years, increasing to A$31.9-million, up from the A$14.2-million reported in the full 2019, while earnings before interest, taxes, depreciation and amortisation increased from A$80.8-million to A$121.9-million.
‘Thanks to the very strong financial performance, we have delivered in the 2020 financial year, the balance sheet is in great shape to continue to fund development of our growth projects, enable advancement of our exciting exploration opportunities, and to pay dividend to shareholders,” said Western Areas MD Dan Lougher.
“Western Areas is now set for long-term nickel exposure, in what is expected to be a growing market for some years to come thanks to electric-vehicle-linked battery demand.
“The long-life Odysseus project makes Western Areas one of the few companies that can demonstrate a clear mining reserve that extends to 2030 and beyond,” Lougher added.
During the full year under review, Western Areas invested A$57.8-million into the Odysseus project, into mostly mine development activity, while a further A$41.6-million in sustaining capital was spent at Forrestania, along with a further A$15.5-million in exploration.
The company also invested A$28.6-million to acquire a 19.9% stake in fellow listed Panoramic Resources.
Looking ahead at 2021, Western Areas has set a nickel-in-concentrate production target of between 19 000 t and 21 000 t.
The miner is expected to spend a further A$25-million to A$30-million on mine development, and between A$90-million and A$110-million on the Cosmos and Odysseus developments.
First concentrate production from Odysseus remains on track for late 2022.