10th Oct 2013 17:24
LONDON (Alliance News) - Kenmare Resources PLC Thursday said product shipments declined 40% in the third quarter despite producing more heavy mineral concentrate.
In an interim management statement, the mining company said total shipments fell to 147,500 tonnes in the third quarter, from 245,600 tonnes in the second quarter.
The company had increased production of heaving mineral concentrate, which it processes into ilmenite and zircon, to 346,200 tonnes, from 290,200 tonnes during the period.
The Irish firm said it increased production of ilmenite to 208,100 tonnes in the third quarter, from 165,100 tonnes in the second.
Kenmare did, however, reduce the amount of primary grade zircon it produced in the third quarter by almost half to 3,800 tonnes, from 6,000 tonnes, while secondary grade zircon levels dipped to 1,900 tonnes from 2,700 tonnes.
Zircon production was adversely impacted by interruptions associated with the upgrade of non-magnetic circuits as part of an expansion, it said.
The company said recent pricing, as well as the near term pricing outlook, remained weak.
Nonetheless it remained optimistic and said it had seen some improvement in demand for ilmenite with an increased level of orders and inquiries in recent weeks, while the zircon market had shown signs of recovery assisted by improving demand in China and Europe.
"Despite some impending seasonal reduction in ceramic tile plant operating rates, demand for zircon is holding up well and the pricing outlook remains stable," Kenmare said.
Kenmare said it is in discussions with Absa Bank Limited for a USD20 million extension of its existing USD20 million loan until March 2015.
Kenmare also announced a placing of 250 million shares, around 10% of the firm, to apply against the loan. The gross proceeds of the placing is expected to be around GBP66.3 million.
The stock closed at 29.09 pence Thursday up 0.44 pence or 1.5%.
By Anthony Tshibnagu; [email protected];
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