Strategic Minerals Plc (LON:SML) shares buzzed higher at the opening bell on Tuesday after the firm told investors it achieved record sales from its Cobre magnetite tailings project in New Mexico in the final quarter of 2017.
AIM-quoted Strategic sold just shy of 31,000 tons of magnetite ore in the three months to the end of December, for US$2.14mln.
Those figures are marginally up on the previous record of US$2.04mln and 29,539 tons which the company set in the prior quarter.
“Given that the September quarter partly reflected clearance of prepaid June tonnage, this is a strong result,” read Tuesday’s statement.
On track for US$1mln+ annual pre-tax profit
In total, Strategic Minerals recorded annual sales of US$5.64mln (84,980 tons) from Cobre in 2017 – more than a 300% increase on the sales achieved in 2016.
Subject to audit review, the company said it expects to record its first annual pre-tax profit in excess of US$1mln.
The strong sales performance also meant Strategic ended 2017 with a cash balance of US$3.81mln (30 Sept 2017: US$1.63mln).
This “healthy” cash position has allowed the firm to settle the cash component of the Leigh Creek Copper Mine acquisition, as well as internally fund the start-up of Leigh Creek, the CARE 2018 drilling programme and the expected share of 2018 Redmoor exploration expenses.
£100mln market cap targeted
“The December quarter has seen the profits and cash flow from our Cobre operations reach record highs,” said managing director John Peters.
“This has placed the company in a strategically advantageous position, enabling it to acquire the Leigh Creek Copper Mine and undertake exploration with little dilution to shareholders.”
He added: “The board and management will continue with the asset development plan to drive revenue higher in order to achieve the company's targets of a £100mln market capitalisation and a share price above £0.0575.”
Shares opened 6% higher at 2.23p.