REG-Base Resources Limited: FY24 half-year results

Base ResourcesAnnouncement

26/02/2024 07:15

AIM and Media Release 

26 February 2024

Base Resources Limited
FY24 half-year results

African mineral sands producer and developer, Base Resources Limited (ASX &
AIM: BSE) (Base Resources or the Company) is pleased to present its financial
results for the six-month period ended 31 December 2023 (H1 FY24 or reporting
period).

Kwale Operations continued to perform to plan and remains on track to achieve
production guidance for FY24.  During the reporting period, mining entered
the lower grade ore bodies that will characterise the remaining mine life,
which resulted in reduced production and lower sales volumes.  The period
also saw softening sales prices for all products.

After limited engagement with the Government of Madagascar in the lead up to
the Presidential elections in November 2023, discussions on fiscal terms and
lifting of the Toliara Project’s suspension have recommenced.  With the
Government indicating that progressing the Toliara Project is a priority, the
new year has seen a period of sustained engagement with positive progress made
– including expressed support for production of a monazite product from the
project.

In light of progress achieved and the Government’s demonstrated level of
focus and engagement, in applying the Company’s capital management policy
the Board has decided not to pay an interim dividend. 
Key Outcomes for H1 2024Financial* Decreases in average achieved product
prices of 4% for rutile, 9% for ilmenite and 18% for zircon compared to the
period ended 31 December 2022 (H1 FY23).
* H1 FY24 revenue of US$73.1 million.
* Group EBITDA of US$14.7 million and a net loss after tax of US$1.5 million. 
* Free cashflow of US$14.8 million (operating cashflows of US$25.2 million
less investing cashflows of US$10.4 million).
* Net cash position of US$78.9 million at 31 December 2023.
Operational and development * Kwale Operations ore grade of 2.39%, down from
3.90% in H1 FY23, as mining operations moved to lower grade ore bodies as
planned.
* Production of 18,909 tonnes of rutile, 77,663 tonnes of ilmenite, 7,657
tonnes of zircon and a combined 4,140 tonnes of low-grade rutile and zircon
products.
* Toliara Project monazite pre-feasibility study completed, delivering
exceptional outcomes and resulting in a significant enhancement of the overall
project economics, with the project’s post tax NPV10 doubling to US$2.0
billion.
Managing Director of Base Resources, Tim Carstens, said:
“Kwale Operations once again performed consistently to plan, but with only
lower grade ore bodies remaining, production and sales volumes were lower as
expected.  Despite this, and softening market conditions for our products,
Kwale Operations continued to operate profitably and generate positive
free-cash flow, with preparations for post-mining after December 2024
occurring in parallel.”

“We were excited to deliver the results from the monazite pre-feasibility
study in December, enhancing the already exceptional potential of the Toliara
Project.  Realisation of this potential is now more important than ever. With
the President of Madagascar’s government now formed and a new Mining Code in
place, a positive shift in dynamics and significant focus and attention from
the Government on the project’s progression is evident.  We are optimistic
that mutually attractive fiscal terms can be secured that will support
development of the Toliara Project for the benefit of our host communities,
the nation of Madagascar and our shareholders.”

“In this context and in light of the approaching conclusion of mining at
Kwale Operations, we believe it is appropriate that cash now be retained for
the anticipated progression of the Toliara Project.” 
ADDITIONAL H1 FY24 results reporting suite DOCUMENTS ATTACHED
For further information in relation to Base Resources’ H1 FY24 operating and
financial results, refer to the PDF copies of the Company’s Interim
Financial Report and H1 FY24 results Investor Presentation, both attached to
this release and available from the Company’s website at: 
https://baseresources.com.au/investors/announcements/.
Investor webcast
An investor webcast will be hosted by Base Resources’ Managing Director, Tim
Carstens, Chief Financial Officer, Kevin Balloch, and General Manager -
Marketing, Stephen Hay, who will each also be available to answer questions
following a presentation of the Company’s results.

Details for the webcast are below.  Participants will be able to ask
questions via the messaging function on the webcast platform or via the
teleconference line.  Participants proposing to use 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 speaking to an operator.
* Date:  Monday, 26 February 2024
* Time:  5.00pm AWST / 9.00am GMT 
* Webcast URL:  https://webcast.openbriefing.com/hyr-bse-24-uk/ 
* Teleconference registration URL:
 https://registrations.events/direct/OCP2304597 
IMPORTANT NOTICESForward looking statements
Certain statements in or in connection with this announcement 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.
Toliara Project – Forecast Financial Information
This announcement discloses the NPV from the Monazite PFS on an aggregated
basis with the NPV from the Mineral Sands DFS2.  Base Resources’
announcement on 14 December 2023, titled “Additional critical mineral stream
doubles Toliara’s NPV” (the Monazite PFS Announcement), discloses the
material assumptions and underlying methodologies adopted for deriving the NPV
from the Monazite PFS.  It also discloses key risks in respect of the
Monazite Project and the Toliara Project as a whole.  Base Resources confirms
that all the material assumptions underpinning the production information and
forecast financial information in the Monazite PFS Announcement continue to
apply and have not materially changed.

Base Resources’ announcement on 27 September 2021, titled “DFS2 enhances
scale and economics of the Toliara Project” (the Mineral Sands DFS2
Announcement), discloses the material assumptions and underlying methodologies
adopted for deriving the NPV from Mineral Sands DFS2.  Base Resources
confirms that all the material assumptions underpinning the production
information and forecast financial information in the Mineral Sands DFS2
Announcement continue to apply and have not materially changed.

Base Resources’ announcements are available at
https://baseresources.com.au/investors/announcements/.         


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          

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 / George Grainger
Phone: +44 20 7523 8000

JOINT BROKER
Berenberg
Matthew Armitt / Detlir Elezi
Phone: +44 20 3207 7800

 H1 FY24 - Interim Financial Report (https://mb.cision.com/Public/22548/3935401/a3bb23df65110987.pdf)  H1 FY24 - Investor Presentation (https://mb.cision.com/Public/22548/3935401/99bff826cf727f8c.pdf)  



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