ST HELIER, Jersey, August 17, 2015 /PRNewswire/ --
Consmin, a leading manganese ore producer with mining operations in Australia and Ghana, announces its annual results for the period ending 30 June 2015.
Commenting on the results, David Slater (CFO of Consmin) said:
"During the second quarter Consmin delivered operational performance in line with its expectations. Financial performance for the quarter, however, was lower as a result of the continuing difficult pricing environment, offset by continuing improvement in C1 costs. Liquidity in the quarter improved from $80 million to $114 million.
The manganese C1 cash cost for quarter was $1.99/dmtu, a decrease of 19% from $2.46/dmtu for Q2 2014. This reduction in the C1 cash cost was another positive achievement benefitting from reduced mining costs and the impact of the relative weakening of the Australian dollar. The 2015 full year estimate for the C1 cash cost is expected to be below $2.25/dmtu based on an exchange rate for the Australian dollar of 0.75 for the remainder of the year.
In the first four months of 2015 manganese prices came under heavy downward pressure due to the slowdown in Chinese steel production, poor liquidity, stricter environmental measures and poor margins for both ferroalloy and steel producers, which have cumulatively led to weaker demand for manganese ore. The oversupply in the manganese ore market has prompted more aggressive offers by some suppliers driving prices down to close to or below cost levels. Consmin continues to remain cautious in its expectations for the remainder of 2015, with prices for the three-month period from May to July having stabilised and looking likely to remain flat for August, suggesting that prices may have reached or are close to the bottom.
On 27 May 2015, Consmin and TMI entered into an agreement concluding the differences that had arisen in their relationship, including the termination of all existing legal proceedings, and the re-establishment of their mutual trading relationship. As part of that negotiated conclusion, Consmin received $51 million from TMI, which comprises in part a payment to access manganese ore from Ghana in the future and in part an advance payment in respect of future shipments.
During the second quarter Consmin shipped 105k dry tonnes to TMI with an additional shipment of 104k dry tonnes sailing in early July. In July 2015, Consmin and TMI signed a three year Memorandum of Understanding (MoU) to supply 1 million tonnes per annum of Ghanaian ore, commencing in September 2015. Sales to TMI will complement on-going sales to EMM producers in South China, along with sales to our long-term customers in Ukraine, Norway and Slovakia."
About Consolidated Minerals Limited
Consmin is a leading manganese ore producer with mining operations in Australia and Ghana. The principal activities of the Company and its subsidiaries (the "Group") are the exploration, mining, processing and sale of manganese products. The Group's operations are primarily conducted through four major operating/trading subsidiaries; Consolidated Minerals Pty Limited (Australia), Ghana Manganese Company Limited (Ghana), Manganese Trading Limited (Jersey) and Pilbara Trading Limited (Jersey).
Consolidated Minerals Limited is headquartered in Jersey and the address of its office is Commercial House, 3 Commercial Street, St Helier, Jersey, Channel Islands, JE2 3RU.
For further information, please visit our website http://www.consmin.com
SOURCE Consolidated Minerals Ltd