leadf
logo-loader

VSA Capital Market Movers - Ferro Alloy Resources

Ferro Alloy Resources (LON:FAR) has announced further funding via equity and bonds totalling c£733k. The equity subscription took place at 8p raising £500k and follows the recent fundraising of the same quantum and price earlier in the month. For this tranche 6.25mn shares were issued. In addition, FAR issued cUS$300k in bonds with an effective interest rate of 7%pa paid semi-annually.

Ferro-Alloy Resources Group -

VSA Morning Miner, 16/09/20

Ferro Alloy Resources (LON:FAR)

Ferro Alloy Resources (LON:FAR) has announced further funding via equity and bonds totalling c£733k. The equity subscription took place at 8p raising £500k and follows the recent fundraising of the same quantum and price earlier in the month. For this tranche 6.25mn shares were issued. In addition, FAR issued cUS$300k in bonds with an effective interest rate of 7%pa paid semi-annually. The bonds mature on March 23 and the investors have the right to request early repayment after twelve months.  

FAR has therefore raised significant funds in recent weeks which will support increased production and revenue. The company in a recent operational update described a target of 60tpm of vanadium for H2 2020 and the funding will enable the company to achieve that through spending on operational equipment to improve filtration and washing which will increase throughput and product quality. FAR will also complete the installation of the equipment to convert ammonium metavanadate to V2O5. The latter is a substantially value add product; AMV sells at a c15% discount to V2O5. This will therefore, enhance the top line and earnings outlook over the balance of the year.  

The power line has been consistently highlighted as a key bottleneck and the additional funding will enable the completion of the 2km spurline, installation of transformers and automated control, really protection and high frequency communication systems. There is however, some remaining work which will be to install the open switchgear and the low voltage line from there to the operations will be completed in spring of 2021. That said, some of the improvements will have an immediate impact reducing power costs by half and increasing reliability and reducing intermittent outages which has thus far held production back. 

FAR with this additional funding will be able to make substantial progress, in our view, with a direct and quick positive impact on operational efficiency and performance which we expect to feed into improved earnings performance.  

We reiterate our Buy recommendation and target price of £1.71/sh. 

 

Oliver O'Donnell, CFA, Head of Research & Natural Resources Analyst | T: +44 (0)20 3617 5180 | E: [email protected]
Paul Renken, Senior Geologist | T: +44 (0)20 3005 5011 | E: [email protected]

VSA Capital Research | T: +44 (0)20 3005 5000 | E: [email protected]

VSA Capital Limited, New Liverpool House, 15-17 Eldon Street, London EC2M 7LD | www.vsacapital.com

This email is intended solely for the named recipient. It may contain privileged and/or confidential information. If you are not one of the intended recipients, please notify the sender immediately, and destroy this email: any disclosure, copying to any person or any action taken or omitted to be taken in reliance on this e-mail, is prohibited and may be unlawful. Any views expressed in this message are those of the individual sender, except where specifically stated to be the view of VSA Capital Limited, its subsidiaries or associates. Whilst all efforts are made to safeguard inbound and outbound emails, VSA Capital Limited and its subsidiaries or associates cannot guarantee that attachments are virus-free or compatible with your systems and do not accept any liability in respect of viruses or computer problems experienced.

VSA Capital Limited will use your personal information to administer your account in order to provide any products and services you have requested from us. Your personal information will be kept secure and will not be shared with any other party unless you provide consent to that effect.

VSA Capital Limited is Authorised and Regulated by the Financial Conduct Authority and is a member of the London Stock Exchange.
The Company is registered in England with company number 2405923 at New Liverpool House, 15-17 Eldon Street, London EC2M 7LD.

Please consider the environment before printing this e-mail

unsubscribe from this list    update subscription preferences 

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Red Rock Resources raises £1m to 'put rocket fuel into the engine'

  Red Rock Resources PLC's (LON:RRR) Andrew Bell talks to Proactive London about their £1m placing which will be used for their projects in Kenya, now that they have regained their license. Other projects in the Congo and Australia will also benefit from this placing and as Bell says,...

13 hours, 41 minutes ago

3 min read