17th Feb 2015 08:58
LONDON (Alliance News) - Ferrex PLC shares dropped on Tuesday after it reported a wider pretax loss for the year and reported a low cash balance, but said it is confident it will secure further funding to move into production during 2015, which will generate the company's maiden revenue.
Ferrex shares were down 12.4% to 0.460 pence per share on Tuesday morning.
For the year ended September 30, the miner reported a wider pretax loss of GBP1.9 million, from GBP1.7 million a year earlier. The company does not currently generate any revenue, and the wider loss was caused by GBP426,000 in finance costs in 2014, compared to nil a year earlier.
The company also reduced administrative costs during the year to GBP1.5 million from GBP1.7 million.
Ferrex is focusing on the Nayega manganese project in Togo, and is also exploring two iron ore projects spread over Gabon and South Africa.
"I believe we have made solid headway in continuing the development of our portfolio which includes the Nayega manganese project in Togo; the Mebaga iron ore project in Gabon; and the Malelane iron ore project in South Africa, with a view to becoming a low-cost producer of minerals for the steel industry," said Chairman Brian Moritz.
Due to an "unfavourable" iron ore price, the company has turned most of its focus to the Nayega manganese project. It has just completed a definitive feasibility study for Nayega, which has a capital expenditure cost of USD14.5 million to develop the first phase of the project, said Ferrex.
"With regard to funding, our cash position obviously remains tight given that we have ongoing monthly commitments and are seeking to move into production at Nayega in the course of this calendar year," said Moritz.
Ferrex reported a cash balance of GBP107,000 at the end of the period, but said it is "confident that it will be able to secure funding," in the future.
By Joshua Warner; [email protected]; @JoshAlliance
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