Strategic Minerals Plc (LON:SML) has released a quarterly update on its sales performance, for the Cobre magnetite tailings operations, which shows it had “maintained and improved” underlying volumes.
The figures, for the three months ended June 30, however, don’t include the impacts of a suspension of transactions with a major client as they are due to be reflected in the numbers for the current quarter.
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Nonetheless, the company told investor that recent arrangements with the client mean there will be a “net minimal impact” on cash flow and highlighted that its full year figures will reflect the additional sales arising from the major client during the September and December 2017 quarters.
In terms of the numbers themselves, Strategic Minerals said that it had sold 11,694 tonnes in the quarter, compared to 10,446 tonnes in the 2017 comparative, which translates to US$695,000 for the three months against a comparative figure of US$602,000.
Over the year to June 30, some 89,599 tonnes were sold for just over US$6mln in aggregate, up from 41,828 tonnes and US$2.43mln.
The company said it had a US$2.08mln cash balance at the end of June.
In early July, the company received a US$375,000 payment from the major client which, according to Strategic Minerals, reinforces its expectation that it will fund its 2018 development expansion plans from internally generated funds.
"Underlying Cobre sales continue to underpin the company's operations and existing resources are being reinvested to progress the company's other exploration and development projects, most notably the reinstating of the Leigh Creek Copper Mine which is expected to return to production and deliver substantial cash flows for the company in the second half of 2019,” said John Peters, Strategic Minerals managing director.
Proceeds from Cobre sales were reinvested into works at other projects - namely, the operations conducted by Central Australian Rare Earths, Leigh Creek Copper Mine and Cornwall Resources.
Net cash decreased by US$1.02mln, partly reflecting a US$978,000 payment to US Tax authorities for income tax in 2017 and quarterly instalments for 2018.