8th Apr 2022 09:22
(Alliance News) - Ferrexpo PLC shares rose on Friday after the iron ore pellet producer in Ukraine said that its operations are outside the main conflict zones, allowing it to continue operations and deliveries to key customers in Europe.
Shares were trading 12% higher at 188.00 pence each on Friday morning in London.
The Baar, Switzerland-headquartered firm reported total iron ore pellet production of 2.7 million tonnes in the first quarter of 2022, in line with the same period in 2021.
However, iron ore pellet production fell 11% below the fourth quarter, due to operational and logistical constraints following Russia's invasion of Ukraine.
Ferrexpo said production continued to comprise entirely of high-grade forms of iron ore, which are those with an iron ore grade of 65% or above.
It also generated first-quarter sales of 2.6 million tonnes, scaling production activities to meet the accessible pellet demand.
Ferrexpo noted that logistics pathways to Europe through rail and barge remain open, while activities at the Black Sea port of Pivdennyi continue to be suspended. Sales to customers in Europe represented roughly 50% of sales in the past.
Net cash amounted to approximately USD159 million at the end of the quarter, "with stable available financing lines marginally impacting the debt position."
Ferrexpo stated that it will continue to produce and transport its products as long as the capability is in place, and it is safe to do so.
"Our operations and local communities are outside the main conflict zones within Ukraine, enabling us to continue our activities, including the delivery of iron ore pellets to customers in Europe via rail and barge, which have historically represented approximately 50% of sales. The port of Pivdennyi in southwest Ukraine, where the group's berth is located, remains closed, and we are reviewing alternative methods of delivering our products to seaborne markets," Chief Executive Officer Jim North commented.
By Abby Amoakuh; [email protected]
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