TIDMSML
RNS Number : 6543Z
Strategic Minerals PLC
14 January 2020
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
14 January 2020
Strategic Minerals plc
("Strategic Minerals" or the "Company")
December Quarter 2019 Magnetite Sales and Cash Balances
Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a producing
mineral company actively developing projects prospective for
battery materials, is pleased to provide the following update on
the Company's cash position and ore sales at the Cobre magnetite
operation in New Mexico, USA ("Cobre") for the quarter ended
December 2019.
Highlights
-- Continued improving demand from existing Cobre clients
-- Underlying sales revenue in the December 2019 quarter 12.5% higher than December 2018 quarter
-- Group cash balance of US$0.520m as at 31 December 2019
-- Arbitrator for dispute with major client appointed and
arbitration meeting expected to be scheduled shortly
Sales update: Cobre magnetite tailings operations
Underlying sales volumes at Cobre continued to improve during
the December quarter. Sales revenue during the quarter was 12.5%
higher than the comparative quarter in 2018. Sales revenue for the
year ended 31 December 2019 was weaker than in 2018 and 2017 due to
the adverse impact caused by Cobre's major client's diminished
purchases. Sales revenue shown here for the annual period to 31
December 2019 excludes deposits from the major client received,
over a year ago, which the client has now forfeited. As legal
action has commenced in relation to this client, expectations on
future sales are focused on those arising from other existing
customers. The Company continues to look to grow sales organically
and source potential new customers.
Sales comparisons on quarterly and annual periods to 31 December
2019, along with associated volume details, are shown in the table
below:
Tonnage Sales (US$'000)
---------------------------- -----------------------------
Year 3 months to 12 months to 3 months to 12 months to
Dec Dec Dec Dec
2019 12,202 42,517 713 2,488
2018 10,931 54,565 633 3,350
2017 30,730 84,979 2,139 5,637
A claim has been made under the contract with the major client
and, as per this contract, an arbitration meeting is being
scheduled. An arbitrator has been appointed and the Company expects
that an arbitration date will be established soon.
Financials and Operations
At 31 December 2019, the Group's non-restricted cash balance was
US$0.520m (30 September 2019: US$0.760m).
Commenting, John Peters, Managing Director of Strategic
Minerals, said:
"Stable sales volumes and continued organic growth at Cobre
provides the Company with a solid foundation from which the Board
can look to execute its strategy across the wider portfolio. Access
to the magnetite stockpile is expected to automatically rollover at
the end of February.
"The key focus in 2020 remains on developing a reliable second
income stream from LCCM and SML is engaged in a number of active
discussions with potential sources of financing to move its
projects forward via a solution which is best for the Company and
its shareholders alike."
For further information, please contact:
+61 (0) 414 727
Strategic Minerals plc 965
John Peters
Managing Director
Website: www.strategicminerals.net
Email: info@strategicminerals.net
Follow Strategic Minerals on:
Vox Markets: https://www.voxmarkets.co.uk/company/SML/
Twitter: @SML_Minerals
LinkedIn: https://www.linkedin.com/company/strategic-minerals-plc
Facebook: https://www.facebook.com/search/top/?q=strategic%20minerals%20plc
+44 (0) 20 3470
SP Angel Corporate Finance LLP 0470
Nominated Adviser and Broker
Ewan Leggat
Stephen Wong
Notes to Editors
Strategic Minerals plc is an AIM-quoted, operating minerals
company actively developing projects prospective for battery
materials. It has an operation in the United States of America and
Australia along with development projects in the UK and Australia.
The Company is focused on utilising its operating cash flows, along
with capital raisings, to develop high quality projects aimed at
supplying the metals and minerals being sought in the burgeoning
electric vehicle/battery market.
In September 2011, Strategic Minerals acquired the distribution
rights to the Cobre magnetite tailings dam project in New Mexico,
USA, a cash-generating asset, which it brought into production in
2012 and which continues to provide a revenue stream for the
Company. This operating revenue stream is utilised to cover company
overheads and invest in development projects orientated to
supplying the burgeoning electric vehicle/battery market.
In January 2016, the portfolio was expanded with the acquisition
of shares in Central Australian Rare Earths Pty Ltd, which holds
tenements in Western Australia prospective for cobalt, nickel
sulphides and rare earth elements. The Company has since acquired
all shares in Central Australian Rare Earths Pty Ltd. In September
2018, the Company entered contracts for the sale of certain CARE
tenements identified as gold targets.
In May 2016, the Company entered into an agreement with New Age
Exploration Limited and, in February 2017, acquired 50% of the
Redmoor Tin/Tungsten project in Cornwall, UK. The bulk of the funds
from the Company's investment were utilised to complete a drilling
programme that year. The drilling programme resulted in a
significant upgrade of the resource. This was followed in 2018 with
a 12-hole 2018 drilling programme has now been completed and the
resource update that resulted was announced in February 2019. In
March 2019, the Company entered into arrangements to acquire the
balance of the Redmoor Tin/Tungsten project. This was completed on
24 July 2019.
In March 2018, the Company completed the acquisition of the
Leigh Creek Copper Mine situated in the copper rich belt of South
Australia and brought the project into production in April
2019.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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