8th Apr 2016 07:11
LONDON (Alliance News) - Base Resources Ltd Friday increased its production guidance for the full year after production rose in its third quarter, but said its margin has been squeezed since the previous quarter.
The company said it now expects to produce 82,000 to 86,000 tonnes of rutile, 440,000 to 455,000 tonnes of ilmenite and 29,000 to 31,000 tonnes of zircon in the financial year that will end in June.
That is slightly higher than its previous guidance that suggested production would amount to 80,000 to 84,000 tonnes of rutile, 430,000 to 450,000 tonnes of ilmenite and 27,000 to 30,000 tonnes of zircon.
That positive news was released in tandem with its third quarter production results, which showed the company produced 110,760 tonnes of ilmenite, 21,194 tonnes of rutile and 7,865 tonnes of zircon in the three months ended March 31.
Rutile production was the only segment to fall quarter-on-quarter, but the company produced more of each commodity compared to the same period a year earlier.
Rutile sales in the quarter amounted to 95,984 tonnes, rutile 14,500 tonnes and zircon sales totalled 9,556 tonnes. Zircon sales were the only segment to experience a quarter-on-quarter rise whilst rutile was the only commodity to experience a year-on-year rise in sales.
The company also said each tonne of product sold generated USD208 in revenue during the quarter, whilst its cash operating cost amounted to USD96 per tonne - delivering a margin of around USD112 per tonne.
That is a tighter margin than what it achieved in the previous quarter, when revenue per tonne stood at USD245 but operating costs were higher at USD102 per tonne - which provided a better margin of USD143 per tonne.
However, the margin achieved in the most recent quarter was still considerably better than a year earlier when it was selling a tonne of product for USD191 at a cost of USD130, delivering a margin of only USD61 per tonne.
Base Resources shares were untraded on Friday morning, last trading at 3.25 pence.
By Joshua Warner; [email protected]; @JoshAlliance
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