ZUG, Switzerland, Aug. 8, 2018 /CNW/ - Katanga Mining
Limited (TSX: KAT) ("Katanga" or the
"Company") today announces its 2018 second quarter financial
results. Katanga's interim Financial Statements and Management's
Discussion and Analysis will be available on SEDAR,
www.sedar.com.
Financial performance highlights for the three and six months
ended June 30, 2018
|
|
Three months
ended
|
Six months
ended
|
|
|
Jun
30,
2018
|
Mar 31,
2018
|
Jun 30,
2017
|
Jun
30,
2018
|
Jun 30,
2017
|
Sales
|
$'000
|
345,527
|
146,743
|
11,723
|
492,270
|
11,721
|
Mining, processing
and other costs (net of changes in metal stocks)*
|
$'000
|
(130,372)
|
(101,951)
|
(24,519)
|
(232,323)
|
(24,519)
|
Royalties and
transportation costs*
|
$'000
|
(51,865)
|
(21,787)
|
-
|
(73,652)
|
-
|
Depreciation and
amortization*
|
$'000
|
(61,352)
|
(54,610)
|
-
|
(115,962)
|
-
|
Gross profit
(loss)
|
$'000
|
101,938
|
(31,605)
|
(12,796)
|
70,333
|
(12,798)
|
Net (loss)
attributable to equity holders
|
$'000
|
(324,548)
|
(77,924)
|
(126,555)
|
(402,472)
|
(227,478)
|
|
|
|
|
|
|
|
Adjusted
EBITDA**
|
$'000
|
151,008
|
16,359
|
(73,604)
|
167,367
|
(126,070)
|
|
|
|
|
|
|
|
Basic and diluted
loss per common share
|
$/share
|
(0.17)
|
(0.04)
|
(0.07)
|
(0.21)
|
(0.12)
|
|
|
|
|
|
|
|
C1 cash
cost***
|
$/lb
|
1.08
|
2.54
|
nm
|
1.72
|
nm
|
|
*Since the
resumption of production, expenses previously disclosed in
operating expenses have been reclassified to cost of
sales.
|
** The aggregation
of sales, cost of sales (less depreciation), operating expenses,
general and administrative expenses, loss on disposal of property,
plant and equipment and foreign exchange gains and losses are
included within adjusted EBITDA (Refer to item 22 Non-IFRS
financial measures).
|
***Refer to item
22 Non – IFRS financial measures of the MD&A.
|
|
|
Three months
ended
|
Six months
ended
|
|
|
Jun
30,
2018
|
Mar 31,
2018
|
Jun 30,
2017
|
Jun
30,
2018
|
Jun 30,
2017
|
Copper
revenue
|
$'000
|
204,383
|
146,480
|
5
|
350,863
|
3
|
|
|
|
|
|
|
|
Cobalt
revenue
|
$'000
|
141,144
|
-
|
-
|
141,144
|
-
|
|
|
|
|
|
|
|
Concentrate
revenue
|
$'000
|
-
|
263
|
11,718
|
263
|
11,718
|
Total
revenue
|
$'000
|
345,527
|
146,743
|
11,723
|
492,270
|
11,721
|
Including net
provisional pricing adjustment
|
|
(1,188)
|
1,297**
|
5
|
109
|
3
|
|
|
|
|
|
|
|
Copper cathode
sold
|
tonnes
|
30,825
|
22,636
|
-
|
53,461
|
-
|
|
|
|
|
|
|
|
Cobalt contained in
hydroxide sold
|
tonnes
|
2,176
|
-
|
-
|
2,176
|
-
|
|
|
|
|
|
|
|
Copper contained in
concentrate sold
|
tonnes
|
-
|
74
|
4,778
|
-
|
4,778
|
|
|
|
|
|
|
|
LME average copper
price
|
$/lb
|
3.12
|
3.16
|
2.62
|
3.14
|
2.65
|
|
|
|
|
|
|
|
Realized copper
price*
|
$/lb
|
2.49
|
2.48
|
-
|
2.50
|
-
|
|
|
|
|
|
|
|
LMB average cobalt
price
|
$/lb
|
42.45
|
38.37
|
26.06
|
40.41
|
22.90
|
|
*Realized copper
prices are based on gross copper revenue (above) after deducting
realization charges, royalties and other selling
expenses.
|
** Amount has been
updated to reflect only the mark to market adjustment amount in Q1
2018.
|
The movement in revenue is due to the following price and volume
factors:
- Copper revenue increased to $204.4
million in Q2 2018 from $146.5
million in Q1 2018. Copper revenue increased to $350.9 million in H1 2018 from $0.03 million in H1 2017. Cobalt revenue
increased to $141.1 million in Q2
2018 from $nil million in Q1 2018. Cobalt revenue increased to
$141.1 million in H1 2018 from $nil
million in H1 2017. The increase in copper and cobalt revenue for
both periods relates to an increase in sales of copper cathode and
cobalt contained in hydroxide due to the resumption of production
in December 2017 following the
completion of phase 1 of the WOL Project and the ongoing ramp-up of
production in 2018;
- Concentrate revenue decreased to $nil million in Q2 2018 from
$0.3 million in Q1 2018. Concentrate
revenue decreased to $nil revenue in H1 2018 from $2.0 million in H1 2017. The decrease in
concentrate revenue for both periods relates to a decrease in KITD
oxide concentrate sales, driven by the utilization of concentrate
in the leaching process following the completion of phase 1 of the
WOL Project in December 2017 to
produce copper cathode; and
- Included in sales is a net provisional pricing adjustment
resulting from movements in the commodity price between the date of
sale and the final pricing based on average prices for a specified
period thereafter. At each reporting date, provisionally priced
sales that have not been finalized retain an exposure to future
changes in prices and are marked-to-market based on London Metal
Exchange ("LME") forward prices. These adjustments were recorded in
sales in the statement of loss and within receivables on the
statement of financial position.
About Katanga Mining Limited
Katanga Mining
Limited operates a major mine complex in the Democratic Republic of Congo producing refined
copper and cobalt. The Company has the potential to become
Africa's largest copper producer
and the world's largest cobalt producer. Katanga is listed on the
Toronto Stock Exchange under the symbol KAT.
Forward Looking Statements
This press
release may contain forward-looking statements. Often, but not
always, forward-looking statements can be identified by the use of
words such as "plans", "expects" or "does not expect", "is
expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes",
or describes a "goal", or variation of such words and phrases or
state that certain actions, events or results "may", "could",
"would", "might" or "will" be taken, occur or be achieved. This
press release may contain forward-looking statements. Often, but
not always, forward-looking statements can be identified by the use
of words such as "plans", "expects", or "does not expect", "is
expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes",
or describes a "goal", or variation of such words and phrases or
state that certain actions, events or results "may", "could",
"would", "might" or "will" be taken, occur or be achieved.
All forward-looking statements reflect the Company's beliefs
and assumptions based on information available at the time the
statements were made. Actual results or events may differ from
those predicted in these forward-looking statements. All of the
Company's forward-looking statements are qualified by the
assumptions that are stated or inherent in such forward-looking
statements, including the assumptions listed below. Although the
Company believes that these assumptions are reasonable, this list
is not exhaustive of factors that may affect any of the
forward-looking statements. The key assumptions that have been made
in connection with the forward-looking statements include
the following: there being no significant
disruptions affecting the operations of the Company whether due to
legal disputes, judicial action, labour disruptions, supply
disruptions, power disruptions, rollout of new equipment, damage to
equipment or otherwise; permitting, development, operations,
expansion and acquisitions at KCC being consistent with the
Company's current expectations; continued recognition of the
Company's mining concessions and other assets, rights, titles and
interests in the DRC; political and legal developments in the DRC
being consistent with its current expectations; the continued
provision or procurement of additional funding from Glencore for
operations, the completion of the T17 Underground Mine, Phase 2 of
the WOL Project and the Power Project (as defined in the Company's
Annual Information Form for the year ended December 31, 2017 dated March 31, 2018); new equipment performs to
expectations; the exchange rate between the US dollar, South
African rand, British pounds, Canadian dollar, Swiss franc,
Congolese franc and Euro being approximately consistent with
current levels; certain price assumptions for copper and cobalt;
prices for diesel, natural gas, fuel oil, electricity and other key
supplies being approximately consistent with current levels;
production, operating expenses and cost of sales forecasts for the
Company meeting expectations; the accuracy of the current ore
reserve and mineral resource estimates of the Company (including
but not limited to ore tonnage and ore grade estimates); and labour
and material costs increasing on a basis consistent with the
Company's current expectations.
Forward-looking statements involve known and unknown risks,
future events, conditions, uncertainties and other factors which
may cause the actual results, performance or achievements to be
materially different from any future results, prediction,
projection, forecast, performance or achievements expressed or
implied by the forward-looking statements. Although Katanga has
attempted to identify important factors that could cause actual
actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors
that cause actions, events or results not to be as anticipated,
estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements.
The Company disclaims any intention or obligation to update
or revise any forward-looking statements whether as a result of new
information, future events, or otherwise, except in accordance with
applicable securities laws.
SOURCE Katanga Mining Limited