19th May 2016 10:50
LONDON (Alliance News) - Strategic Minerals PLC on Thursday said Cobre operations sales softened in the first quarter compared to a year earlier, as it announced its managing director was reducing his remuneration by more than 15% and its chief financial officer will start being paid on an hourly consulting basis.
The minerals production and development company reported sales of USD227,000 from its Cobre magnetite tailing operations in the US state of New Mexico for the first quarter ended March 31, down from GBP318,000 for the same period a year earlier. However, Strategic Minerals said this "appears consistent with the variability of demand within annual periods", as, on an annualised basis for the twelve months ended March, sales were up.
Strategic Minerals said it "continued to maintain a tight control on overheads" during the quarter, especially following the termination of its Tatu coal project in New Zealand during the March quarter. As part of this effort, the company announced a reduction of more than 15% to its managing director's remuneration and said its chief financial officer was being moved to a consulting basis based on an hourly rate.
"The overheads of being a listed company have been trimmed as much as possible and, it is intended that, remuneration of management and directors, when combined with the listing overheads, will be maintained within the operating profitability of the Cobre mine. Accordingly, any use of funds above this are expected to be, specifically, project orientated," the company said in a statement.
Strategic Minerals' cash was down at USD407,533 at the end of March, from USD640,525 at the end of December, due to its acquisition of CARE, payments due on the Tatu project, and foreign exchange movements. However, Strategic Minerals said it believes the reduction in corporate overheads will ensure adequate reserves exist to progress existing operations.
In February, Strategic Minerals entered into an agreement to purchase up to 50% of CARE, a company which holds the rights to Australian nickel assets.
"The company's production at the Cobre mine continues to underpin its operating costs and the Board and management team are focused on seeking to contain corporate overheads within the current operating profit of the mine," said Managing Director Jon Peters.
"At the same time, our strategy recognises the need for substantial wealth creation through exploration/investment. In this regard, investment reviews have centred on projects with either tied offtake arrangements or ones based on exploration for minerals/metals expected to have strong demand/price upside in a three to five year time horizon," Peters added.
"The board continues to focus on securing additional sales in Cobre, progressing legal claims associated with the rail upgrades undertaken at Cobre, monitoring the drill programme at the Laverton project and progressing its current negotiations seeking an additional project opportunity," the managing director said.
Shares in Strategic Minerals were down 11% at 0.380 pence on Thursday.
By Hannah Boland; [email protected]; @Hannaheboland
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Strategic Minerals