Base Resources quarter boosted by better ilmenite and zircon prices

2017-07-14

Jul. 13, 2017 - Base Resources Limited told investors it had record fourth quarter revenue driven by its Kwale mineral sands operation in Kenya.

The company, in its activity report for the three months to June 30, highlighted production for the full year remained consistent for all products, while noting continued improvement in ilmenite and zircon prices which boosted the group’s performance.

Additionally, the company said net debt reduced significantly to US$24mln from US$98.5mln.

Base also highlighted that the second phase of the Kwale mining operation was green-lighted during the quarter and the project will deliver enhanced economics.

Production guidance for the year amounts to 88,000 to 94,000 tonnes of Rutile, 400,000 to 430,000 tonnes of Ilmenite, 32,000 to 37,000 tonnes of zircon (plus 1,500 to 2,500 tonnes of zircon in low grade material).

Yuen Low, analyst at Shore Cap, described Base Resources’ production as ‘decent’ noting production was up at 2.98mln tonnes, from 2.66mln tonnes in the preceeding quarter, and he highlighted that an increase in unit costs (the result of ‘typical year end costs’) was more than offset by higher unit revenue of US$297 per tonne, versus US$258 in the third quarter.