26th May 2016 13:34
LONDON (Alliance News) - Metals Exploration PLC on Thursday said it swung to profit in 2015 and completed construction on the Runruno Gold Project, having since moved into the commissioning phase.
Metals Exploration is a natural resources exploration and development company with assets in the Pacific Rim region.
The company posted a pretax profit of GBP235,643 for the year ended December 31, having previously reported a pretax loss of GBP3.0 million a year earlier, as administrative costs fell slightly to GBP5.2 million from GBP6.8 million and Metals Exploration received a GBP8.5 million fair-value gain on forward sales contracts. A year earlier, it posted a GBP4.0 million fair-value gain on the forward sales contracts. Metals Exploration is not yet revenue producing.
During the year, Metals Exploration completion the construction of its process plant at the Runruno Gold Project in the Philippines. However, in October the project was hit by delays caused by the Super Typhoon Lando, having previously expected to move into ore commissioning in the fourth quarter of the year.
As such, the company was issued with a partial suspension order, which prevented ongoing construction on the area and required that Metals Exploration undertook a program of rehabilitation and enhancement works on the effected area. This order was lifted in April 2016 and since, Metals Exploration said it has rapidly moved into the ore commissioning and "debugging phase" as it ramps up towards achieving dull commercial production.
However, these delays placed "significant pressure" on Metals Exploration's cash reserves, the company said, and it received GBP13.8 million through additional equity and a debt facility through 2015 to March 2016.
As a result of the delay experienced in commencing commercial operations, Metals Exploration said negotiations continue with funders with regards to the company's existing debt repayment schedule to ensure the project is "not in technical breach through a default on payments", which is due on June 30.
Shares in Metals Exploration were untraded on Thursday, having last traded at 6.65 pence.
By Hannah Boland; [email protected]; @Hannaheboland
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