Harvest Minerals Ltd (AIM:HMI, OTC:HMIFF) said it beat its 2022 sales order target of 150,000 tonnes for its organic fertiliser KP Férti with three months of the year still to go as the AIM-listed fertiliser producer revealed it was cashflow positive in the first half of the year.
With sales orders of 32,676 in the third quarter, the AIM-listed company said sales orders in the first nine months of the year have totalled 153,074 tonnes, more than double the 74,159 a year earlier, with the fourth quarter expected to see “robust” sales.
This has been made at sales margins of 55-60%, it said.
“The upsurge in sales/enquiries has been facilitated by the re-classification of KP Fértil from a remineraliser to a fertiliser in March 2022 coupled with the overall global outlook for fertilisers,” said Harvest chairman Brian McMaster.
“The increased demand for fertilisers is unlikely to abate as the world focuses on feeding its growing population, projected to top 8bn later this year, while the war between Russia and Ukraine, two of the world's biggest exporters of fertiliser, has added further strain to the market.”
The company said it continues to build on its marketing campaign to offer its product for coffee, sugarcane, and other crops, while having also started to market KP Fértil in other regions beyond its immediate market in Minas Gerais and Sao Paulo.
McMaster said Harvest has been adapting to the uptick in sales orders and production requirements, increasing storage capacity in order to maintain higher levels of dry product for production and sale.
“Our operations are continuing smoothly and the Harvest team's response to the higher production levels bodes well for our future growth.
“Financially, the company is on a very sound footing. We are cashflow positive at an overall level and we forecast that to continue,” he said.
Harvest also released its half-year results, which revealed net cash inflows from operating activities of US$693,207 compared to a net cash outflow of US$1.1mln a year earlier.
A loss after tax of US$0.88mln was recorded, down from a loss of US$1.07mln last time.
McMaster said the results and improving cash position “puts a line under the asset write down programme instigated last year”.