Base Resources Limited FY23 results - Kwale continues to deliver strong financial performance
August 27 2023 - 7:01PM
UK Regulatory
TIDMBSE
AIM and Media Release
28 August 2023
Base Resources Limited
FY23 results - Kwale continues to deliver strong financial performance
African mineral sands producer and developer, Base Resources Limited (ASX & AIM:
BSE) (Base Resources or the Company) is pleased to present its results for the
year ended 30 June 2023 (FY23), with higher prices across all products
delivering an EBITDA of US$158.6 million and generating cash flows from
operations of US$117.4 million. The disciplined application of the Company's
capital management policy has supported the determination of a FY23 final
dividend of AUD 4 cents per share (unfranked).
Despite Kwale Operations' robust operational performance, a net loss of US$4.8
million was recorded, with profitability impacted by a non-cash impairment of
US$88.9 million following a reassessment of the carrying value of Kwale
Operations, reflecting the increased operating costs of mining the North Dune,
the softening outlook for mineral sands product prices over the remaining mine
life and an improved understanding of the ultimate costs of closure1.
The Toliara Project in Madagascar remains a significant growth opportunity for
the Company. Despite making sound progress in discussions with the Government
of Madagascar on the fiscal terms applicable to the project and the lifting of
the on-ground suspension, recent engagement has slowed whilst the Government
focuses on finalising its overhaul of the Malagasy Mining Code and preparations
for the upcoming presidential election. The Company remains committed to
developing the world class project and is ready to progress. However, until the
Mining Code reform is finalised, and the elections scheduled for late 2023 have
concluded, the Company does not expect to achieve material progress in securing
fiscal terms or lifting of the project's on-ground suspension. In parallel,
substantial effort is being applied to identification and progression of
attractive business development opportunities to secure optionality in the
project portfolio as well as broader funding options for ultimate Toliara
Project development.
Operational and development highlights for FY23
· Production of 68,814 tonnes of rutile, 297,861 tonnes of ilmenite, 25,954
tonnes of zircon and a combined 18,330 tonnes of low-grade rutile and zircon
products from Kwale Operations.
· Increase in average achieved prices of 18% for rutile, 3% for ilmenite and
3% for zircon compared to the prior year.
· Bumamani Project implementation completed and mining of the North Dune
orebody commenced, extending the mine life of Kwale Operations to December 2024.
· Toliara Project Rare Earths Concept Study completed, confirming the
substantial economic potential of the Toliara monazite content and advancing to
a Pre-Feasibility Study, which remains on track for completion in the March
quarter of 2024.
Financial highlights for FY23
· Revenue of US$271.4 million, with an 8% increase in average realised unit
sales price partially offsetting lower production and sales volumes when
compared to the prior year.
· EBITDA of US$158.6 million and underlying NPAT of US$84.0 million (before
the US$88.9 million impairment charge).
· Free cashflow of US$79.2 million (operating cashflows of US$117.4 million
less US$38.2 million invested to extend Kwale Operations mine life and progress
the Toliara Project).
· Net cash position of US$92.9 million at 30 June 2023.
Final dividend of AUD 4 cents per share determined
Consistent with its growth strategy, the Company seeks to provide returns to
shareholders through both long-term growth in the Company's share price and
appropriate cash distributions. Cash not required for the Company's growth and
development, or to maintain requisite balance sheet strength in light of
prevailing circumstances, can be expected to be returned to shareholders. In
the disciplined application of this capital management approach in the context
of anticipated future cashflows from Kwale Operations and the approaching
closure of the mine, the strategic opportunities being pursued and a net cash
position of US$92.9 million at the end of the period, the Board has determined a
final dividend of AUD 4.0 cents per share (unfranked), totalling A$47.1 million
in aggregate (approximately US$31.3 million).
Upon payment of the final dividend, dividends distributed to shareholders since
October 2020 will total AUD 22.5 cents per share, equal to A$265 million in
aggregate (approximately US$187 million).
The dividend will be paid wholly from conduit foreign income and have record and
payment dates of 11 September 2023 and 28 September 2023, respectively - for
further information, refer to Base Resources' accompanying announcement "FY23
Final Dividend - Key dates and information".
Managing Director of Base Resources, Tim Carstens, said:
"The 2023 financial year has been another operationally and financially
successful one. Strong operational performance, coupled with the continuation
of buoyant mineral sands markets, has delivered a record EBITDA for Kwale
Operations, even with the transition to the more challenging and lower grade ore
sources that will characterise the final years of the operation.
We continue to actively pursue additional mine life extension opportunities in
the Kwale East sector, with a second phase aircore drill program currently
underway. Given the inherent uncertainty associated with exploration,
significant effort is also going into planning for the ultimate closure of Kwale
Operations and the transition to post-mining land use, with the clear objective
of cementing a reputation for excellence in the full life cycle of mining.
The Toliara Project in Madagascar continues to represent a transformational
growth opportunity for the Company. By confirming the substantial commercial
potential of its monazite content, the Toliara Project Rare Earth concept study
has enhanced that opportunity and further reinforces our belief that the project
is the best undeveloped mineral sands asset in the world. We look forward to
sharing more as we complete the study phases and clear regulatory hurdles.
While engagement with the Government on the fiscal terms applicable to the
Toliara Project has slowed due to the Government's focus on its new mining code
and the presidential elections in late 2023, we are clear that our patient
approach is the right one to secure outcomes that will support the realisation
of optimum shareholder value and we remain fully committed to the project's
development.
Having finished the year with a significant cash balance, the Board has
determined an AUD 4 cents per share dividend. In the context of Kwale
Operations' approaching end of mine life and diminishing future cash generation
potential, we believe this strikes the right balance between delivering cash
returns to shareholders and retaining balance sheet strength to fund the
Company's strategic growth initiatives in pursuant of our 2031 vision of
multiple concurrent operations."
Documents attached and forming part of Base Resources' FY23 results reporting
suite
For further information in relation to Base Resources' FY23 operating and
financial results, refer to the PDF copies of the Company's 2023 Annual Report
and FY23 results Investor Presentation attached to this release and available
from the Company's website at:
https://baseresources.com.au/investors/announcements/.
Also attached to this release and available from the Company's website (link
above), and forming part of Base Resources' FY23 results reporting suite, is the
Company's FY23 Corporate Governance Statement.
Investor webcasts
Investor webcasts will be hosted by Tim Carstens (Managing Director) and Kevin
Balloch (Chief Financial Officer), who will both be available to answer
questions following a presentation of the Company's results.
Details for the webcasts and teleconferences are below. Participants will only
be able to ask questions via the teleconference line. Participants that propose
using the teleconference line will need to pre-register their details using the
teleconference registration URL provided below. Upon registering, participants
will receive an email with their unique PIN and dial-in details so that they can
join the call without needing to speak to an operator.
Australia webcast and teleconference
· Date: Monday, 28 August 2023
· Time: 8.30am AWST / 10.30am AEST
· Webcast URL: https://webcast.openbriefing.com/bse-fyr-2023/
· Teleconference registration URL:
https://registrations.events/direct/OCP61319
UK webcast and teleconference
· Date: Tuesday, 29 August 2023
· Time: 4.30pm AWST / 9.30am BST
· Webcast URL: https://webcast.openbriefing.com/bse-fyr-2023-uk/
· Teleconference registration URL:
https://registrations.events/direct/OCP60433
Forward looking statements
Certain statements in or in connection with this release contain or comprise
forward looking statements. Such statements may include, but are not limited
to, statements with regard to future production and grades, capital cost,
capacity, sales projections and financial performance and may be (but are not
necessarily) identified by the use of phrases such as "will", "expect",
"anticipate", "believe" and "envisage". By their nature, forward looking
statements involve risk and uncertainty because they relate to events and depend
on circumstances that will occur in the future and may be outside Base
Resources' control. Accordingly, results could differ materially from those set
out in the forward-looking statements as a result of, among other factors,
changes in economic and market conditions, success of business and operating
initiatives, changes in the regulatory environment and other government actions,
fluctuations in product prices and exchange rates and business and operational
risk management. Subject to any continuing obligations under applicable law or
relevant stock exchange listing rules, Base Resources undertakes no obligation
to update publicly or release any revisions to these forward-looking statements
to reflect events or circumstances after today's date or to reflect the
occurrence of unanticipated events.
[Note (1): Refer to note 13 to the FY23 consolidated financial statements
contained in the 2023 Annual Report for further details about the impairment.]
ENDS.
For further information contact:
+--------------------------------+-----------------------------+
|Australian Media Relations |UK Media Relations |
+--------------------------------+-----------------------------+
|Citadel Magnus |Tavistock Communications |
+--------------------------------+-----------------------------+
|Cameron Gilenko and Michael Weir|Jos Simson and Gareth Tredway|
+--------------------------------+-----------------------------+
|Tel: +61 8 6160 4900 |Tel: +44 207 920 3150 |
+--------------------------------+-----------------------------+
This release has been authorised by the Base Resources Disclosure Committee.
About Base Resources
Base Resources is an Australian based, African focused, mineral sands producer
and developer with a track record of project delivery and operational
performance. The Company operates the established Kwale Operations in Kenya and
is developing the Toliara Project in Madagascar. Base Resources is an ASX and
AIM listed company. Further details about Base Resources are available at
www.baseresources.com.au.
PRINCIPAL & REGISTERED OFFICE
Level 3, 46 Colin Street
West Perth, Western Australia, 6005
Email: info@baseresources.com.au
Phone: +61 8 9413 7400
Fax: +61 8 9322 8912
NOMINATED ADVISER & JOINT BROKER
Canaccord Genuity Limited
James Asensio / Raj Khatri
Phone: +44 20 7523 8000
JOINT BROKER
Berenberg
Matthew Armitt / Detlir Elezi
Phone: +44 20 3207 7800
This information was brought to you by Cision http://news.cision.com
The following files are available for download:
https://mb.cision.com/Public/22548/3824549/b5b3327b9b47a596.pdf 2023 Corporate Governance Statement
https://mb.cision.com/Public/22548/3824549/b32eeec6590c4a57.pdf Presentation - FY23 Full Year Results
https://mb.cision.com/Public/22548/3824549/83569c8ce4fc15fa.pdf 2023 Annual Report
END
(END) Dow Jones Newswires
August 27, 2023 19:01 ET (23:01 GMT)
Base Resources (AQSE:BSE.GB)
Historical Stock Chart
From Jun 2024 to Jul 2024
Base Resources (AQSE:BSE.GB)
Historical Stock Chart
From Jul 2023 to Jul 2024