26th Mar 2025 10:37
(Alliance News) - Kenmare Resources PLC on Wednesday reported a sharp drop in annual earnings as product prices weakened, but maintained a confident outlook as it upgraded its main mining facility in Mozambique.
The Mozambique-focused producer of titanium minerals and zircon posted a pretax profit of USD82.1 million for 2024, down from USD149.9 million in 2023.
Revenue declined 9.6% to USD414.7 million from USD458.5 million, while diluted earnings per share nearly halved to USD0.71 from USD1.37.
The company declared a final dividend of 17.00 US cents per share, taking the total 2024 dividend to 32.00 cents, down 43% from 56.04 cents in 2023.
Kenmare said it faced higher operating costs and softer average pricing, which fell 14% year-on-year despite "strong" customer demand and a 4% increase in shipments. Cash operating costs rose 7% to USD243.6 million, reflecting increased labour costs and a modest rise in production.
Kenmare noted again on Wednesday that it had received a non-binding takeover proposal from a consortium including Oryx Global Partners Ltd and former Managing Director Michael Carvill, most recently valuing the company at 530 pence per share. The board unanimously rejected the offer, saying it undervalued the business and its future potential.
However, in an effort to facilitate a possible improvement in terms, Kenmare has granted the consortium limited access to due diligence materials and said it will update the market as appropriate.
Despite operating in what it described as an "uncertain" geopolitical and economic environment, the company expressed confidence in its long-term outlook, citing a strong asset base, capable team and clear strategic purpose.
Operationally, ilmenite output rose 2% to 1.01 million tonnes in 2024, while production of rutile, zircon and concentrates exceeded guidance. Total heavy mineral concentrate output was broadly steady at 1.45 million tonnes.
Looking ahead, Kenmare maintained its 2025 ilmenite production guidance of between 930,000 and 1.05 million tonnes and said demand remained healthy in early 2025, with signs of price stabilisation after a weaker 2024.
Kenmare also hailed progress on its strategic investment programme, particularly the upgrade and relocation of Wet Concentrator Plant A to the Nataka ore zone, which hosts over 70% of Moma's mineral resources.
Managing Director Tom Hickey said: "This project will deliver stable production from Moma for decades to come and reinforce our low-cost profile."
Kenmare said the USD341 million project remains on budget, with commissioning of new dredges and plant modules expected in the third quarter of 2025 and a new tailings facility set for the fourth quarter. As of March, 77% of the capital budget had been committed.
Kenmare also said it was adopting a phased approach to increasing production, including a second selective mining operation plant and a de-bottlenecking strategy for Wet Concentrator Plant B to optimise capacity at lower capital intensity.
Shares in Kenmare were 1.8% higher at 430.98 pence in London on Wednesday morning.
By Eva Castanedo, Alliance News reporter
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