MOUNT GIBSON IRON LIMITED REPORT FOR THE QUARTER ENDED 30 JUNE 2024
17 July 2024
• Iron ore sales of 0.9 million wet metric tonnes (Mwmt) for the June 2024 quarter at anaverage grade of 65.2% Fe, bringing total sales for the year ended 30 June 2024 (FY24) to4.1 Mwmt at 65.3% Fe, near the upper end of annual guidance of 3.8-4.2 Mwmt.
• Strong Group operating cashflow of $290 million generated in FY24 despite aweaker June quarter where cashflows of $30 million were almost fully offset by adverse provisional pricing adjustments, resulting in a net quarterly cashflow of $1 million.
• Significant growth in the Company’s cash and investment reserves during FY24 to $436 million at 30 June 2024, up from $162 million at the start of the financial year,and excluding the Company’s share and option holdings in Fenix Resources Limited which had a value of approximately $20 million at year end.
Mount Gibson’s total cash and investment reserves equate to approximately $0.37 per share.
• Full year cash operating costs at Koolan Island of $74/wmt sold Free on Board(FOB) before royalties and capital projects, approximately 5% above guidance after averaging $97/wmt FOB in the June quarter.
• Shipments and cargo grades in the September 2024 quarter will be temporarily lower as mining activity transitions as planned to the eastern areas of the Koolan Island Main Pit,after which high grade ore extraction and shipping rates will increase.
Shipping guidance for FY25 is 2.7-3.0 Mwmt reflecting the transitioning activities and ground support work necessary for mining and shipping rates to increase through FY25 and the following year.
• Mount Gibson expects to report its FY24 annual financial results on 21 August 2024. In accordance with its obligations to review the book carrying value of the Koolan Island operation in the context of prevailing iron ore prices, the Company anticipates reporting anon-cash accounting impairment which will effectively bring forward depreciation and amortisation charges that would otherwise be incurred in future years.
Note: All currency is stated in Australian dollars unless noted otherwise.
All financial results are unaudited and remain subject to final period-end adjustments.
Comment
Mount Gibson Chief Executive Officer Peter Kerr said: “Mount Gibson is pleased to report a strong production and financial performance for the 2023/24 financial year.
Although the Company’s cash generation slowed in the June quarter reflective of lower iron ore prices and adverse provisional pricing adjustments, the Koolan Island operation achieved near the upper end of FY24 sales guidance at 4.1 Mwmt grading 65.3% Fe.
Cashflow generation in FY24 exceeded internal expectations with the Company’s cash and investment reserves increasing to $436 million at year end, with no bank borrowings and excluding the $20 million equity holding in Mid-West operator Fenix Resources Limited.
“We enter the 2024/25 financial year with a strong base from which to generate cashflows from the high grade Koolan Island iron ore operation and to pursue new investment opportunities for the business.”
part of a much larger release
i hold MGX
hmmm going to make me wonder if i should have added more in recent weakness ( although it was still above my target price )