REG - Bushveld Minerals Ld - Q1 2024 Operational & Corporate Update

Bushveld MineralsAnnouncement

23/04/2024 07:15

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RNS Number : 5924L  Bushveld Minerals Limited  23 April 2024

Market Abuse Regulation ("MAR") Disclosure

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.

 

23 April 2024

Bushveld Minerals Limited

("Bushveld Minerals", "Bushveld" or the "Company")

Q1 2024 Operational & Corporate Update

 

Bushveld Minerals Limited (AIM: BMN), the primary vanadium producer, is
pleased to announce an operational update for the three months ending 31 March
2024, along with a statement regarding the Company's working capital position.

 

Group highlights

Q1 2024

§ Q1 2024 production of 855 mtV (Q1 2023: 943 mtV).

-     Vanchem achieved a record quarterly production of 498 mtV.

-     Vanchem attained a record monthly production of 200 mtV in March
2024.

§ Q1 2024 weighted average production cash cost(1) (C1) of US$28.4/kgV (Q1
2023: US$25.9).

§ Q1 2024 sales of 880 mtV (Q1 2023: 1,028 mtV).

§ Q1 2024 Total Recordable Injury Frequency Rate ("TRIFR") of 0.00 (Q1
2023: 3.67).

1.     Weighted average production cash cost (C1) is the blended weighted
average production cash cost (C1) of Vametco and Vanchem, divided by Group
production.

 

CORPORATE

Update on Outstanding Funds

§ As previously announced, Acacia Resources Limited ("Acacia") was due to
settle its subscription of US$3.5 million on or before 28 February 2024.
The Company has not to date received the subscription monies from Acacia.
Acacia is in breach of the terms of the subscription letter which it signed
with the Company on 30 November 2023. The Company has instructed its lawyers
to commence legal proceedings against Acacia.

Update on Sale of a 50% interest in Vanchem and 64% interest in Mokopane to
SPR

·      Following the announcement on 20 November 2023, regarding the
sale of a 50% interest in the Vanchem vanadium processing plant for US$21.3
million and the sale of a 64% interest in a subsidiary that owns the Mokopane
Vanadium project for US$3.7 million, the Company hereby announces that
approval from the South African Competition Tribunal, initially anticipated
for February 2024, is now expected to be granted at the earliest in July 2024.
Following this, the sale of Vanchem and Mokopane will complete.

 

Working capital position

§ Due to the delay in receiving funds from Acacia and SPR, production has
been materially adversely affected in the current quarter, particularly at
Vametco. Coupled with notably weaker vanadium prices (declining between 10 and
17% year to date across different markets), the Company's working capital
position is extremely tight. With the completion of the sale of 50% of Vanchem
and its share of Mokopane to SPR being delayed, the Company is dependent on
receipt of further funding to continue operations and is working with its
stakeholders in this regard. The Group's cash balance as at 21 April 2024 was
US$2.22 million, should further funding not be secured in the coming weeks,
the Company may have to suspend operations.

 

Craig Coltman, CEO of Bushveld Minerals Limited, commented:

"I am delighted to share that Vanchem achieved a record quarterly production
and monthly production in March. The reduction in unit cash costs by
approximately 25% at Vanchem, along with a near doubling in production
relative to Q1 2023, demonstrates the success of our initial turnaround
measures. This achievement is noteworthy despite the setback of losing 11 days
of production in January due to the delayed settlement of funds.

Moving on to Vametco, as previously communicated, during the quarter we
conducted a 25-day planned maintenance shutdown, which was completed in
mid-February.

Notwithstanding the operational developments achieved to date, the delay in
payments, coupled with the weaker realised Vanadium prices, now 15% lower than
budgeted, has meant that our working capital position is extremely tight.
However, we continue to engage with all stakeholders to resolve this issue.
Lastly, we will provide 2024 guidance once we have clarity on the funding
position."

Conference call

Bushveld Minerals' Chief Executive Officer, Craig Coltman, and Interim Chief
Financial Officer, Robbie Taylor, will host a conference call at 12:00 pm UK
time (13:00 SAST) today to discuss the quarterly update with analysts and
investors. Participants may join the call by dialling:

Tel: United Kingdom: +44 (0) 330 551 0200; South Africa: Toll Free: 0 800
980 512, USA Local: +1 786 697 3501

Password: Quote Bushveld Minerals when prompted by the operator.

A replay of the conference call will be available on the Company's website
post the call.

 

Investor session

Bushveld Minerals Chief Executive Officer, Craig Coltman  and Interim Chief
Financial Officer, Robbie Taylor will host an investor session on 29 April
2024 at 11:00 am UK time (12:00 pm SAST) via the Investor Meet
Company platform to discuss the operational update.

The session is open to all existing and potential shareholders. Investors can
submit questions via Investor Meet Company dashboard up until 9:00am the
day before the meeting.

Investors can sign up to Investor Meet Company for free and register for the
event via:

https://www.investormeetcompany.com/bushveld-minerals-limited/register-investor
(https://www.investormeetcompany.com/bushveld-minerals-limited/register-investor)
 

Investors who already follow Bushveld Minerals on the Investor Meet
Company platform will automatically be invited.

 

 

BUSHVELD VANADIUM

                                                                    Q1 2024 vs  Q1 2024 vs

 Group(1)                                       Unit     Q1 2024    Q1 2023     Q4 2023
 Production                                     mtV(2)   855        -9.3%       -7.5%
 Weighted average production cash cost(1) (C1)  US$/KgV  28.4       9.8%        4.2%
 Sales(3)                                       mtV(2)   880        -14.4%      -20.4%

1.     Based on provisional, unaudited figures.

2.     mtV = metric tonnes of vanadium.

3.     Reported as final sales to customers.

 

VAMETCO

Operational highlights for Vametco (on a 100% basis)

 Description                   Unit        Q1 2024   Q1 2024 vs  Q1 2024 vs

                                                     Q1 2023     Q4 2023
 Ore mined                     Tonnes      222 666   -33.7%      123.9%
 Total mined (ore + waste)     Tonnes      255 951   -80.3%      14.5%
 Ore grade (in Whole Rock)     % V(2)O(5)  0.76      7.0%        4.1%
 Concentrate produced          Tonnes      69 969    -15.9%      -25.1%
 Concentrate grade             % V         1.06      1.0%        0.0%
 Recovery from Kiln to MVO     %           68.0      -7.7%       0.00%
 Production (Nitro Vanadium)   mtV(2)      357       -47.7%      -39.4%
 Production cash cost (C1)(3)  ZAR/KgV     619.6     53.1%       25.1%
 Production cash cost (C1)(3)  US$/KgV     32.8      43.9%       24.3%
 Foreign exchange rate         ZAR: USD    18.9      6.1%        0.7%

1.     Based on provisional, unaudited figures. Production cash cost is
based on vanadium produced.

2.     mtV = metric tonnes of vanadium.

3.     Excludes depreciation, royalties and selling, general &
administrative expenses. Production cash cost is based on vanadium produced.
Production cash cost (C1) measure does not have any standardized meaning
prescribed by IFRS and differs from measures determined in accordance with
IFRS. This measure is intended to provide additional information and should
not be considered in isolation or as a substitute for measures of performance
prepared in accordance with IFRS. This measure is not necessarily indicative
of net earnings or cash flow from operating activities as determined under
IFRS.

 

Production

§ Q1 2024 production of 357 mtV (Q1 2023: 682 mtV; Q4 2023: 589 mtV), mostly
due to a planned 25-day Kiln maintenance shutdown during the months of January
and February.

§ A further 10-day maintenance shutdown is expected in Q3 2024.

 

 

Costs

§ Q1 2024 production cash cost (C1) of US$32.8/kgV (Q1 2023: US$22.8/kgV; Q4
2023: US$26.4/kgV), mostly impacted by lower production volumes during the
period, as a result of the planned maintenance.

 

VANCHEM

Operational highlights for Vanchem(1)

 Description                      Unit        Q1 2024    Q1 2024 vs  Q1 2024 vs

                                                          Q1 2023     Q4 2023
 Ore Milled                       Tonnes      55 845     -32.5%      -30.8%
 Ore Grade (in Whole Rock)        % V(2)O(5)  1.53%      9.2%        -1.4%
 Milled ore to Kiln               Tonnes      48 348     -25.4%      -23.9%
 Milled Ore Grade                 % V         1.11%      17.0%       14.6%
 Recovery: Kiln to Final Product  %           65%        -8.3%       -5.8%
 Chemicals                        mtV(2)      180        683.1%      374.0%
 Flake                            mtV(2)      166        1009.3%     -21.8%
 FeV                              mtV(2)      152        -32.0%      77.4%
 Total production                 mtV(2)      498        90.9%       48.3%
 Production cash cost (C1)(3)     ZAR/kgV      478.1     -21.0%      -4.8%
 Production cash cost (C1)(3)     US$/kgV     25.3       -25.8%      -5.6%
 Foreign exchange                 ZAR: USD    18.89      6.1%        0.7%

 

1.     Based on provisional, unaudited figures.

2.     mtV = metric tonnes of vanadium.

3.     Excludes depreciation, royalties and selling, general &
administrative expenses. Production cash cost is based on vanadium produced.
Production cash cost (C1) measure does not have any standardized meaning
prescribed by IFRS and differs from measures determined in accordance with
IFRS. This measure is intended to provide additional information and should
not be considered in isolation or as a substitute for measures of performance
prepared in accordance with IFRS. This measure is not necessarily indicative
of net earnings or cash flow from operating activities as determined under
IFRS.

 

Production

§ Vanchem achieved a record quarterly production of 498 mtV (Q1 2023: 261
mtV; Q4 2023: 336 mtV), underpinned by improved ore quality, improved online
time and overall plant efficiencies.

-     Vanchem achieved a record monthly production of 200 mtV in March
2024.

§ Annual 23-day maintenance shutdown expected in May 2024.

 

Costs

§ Vanchem achieved a production cash cost (C1) of US$25.3/kgV (Q1 2023:
US$34.1/kgV; Q4 2023: US$26.8/kgV), supported by higher production volumes
during the quarter and cost savings initiatives.

-     Vanchem attained a monthly production cash cost (C1) of US$19.3/kgV
in March 2024.

 

HEALTHY AND SAFETY

§ Q1 2024 TRIFR  of 0.00 (Q1 2023: 3.67),  supported by improved reporting
of leading indicators analysed and implementation of safety measures.

 

VANADIUM PRICE & MARKET

§ Q1 2024 CRU Ryan's Notes (US) Ferrovanadium prices averaged US$28.4/kgV,
showing a decline from US$31.6/kgV achieved in Q4 2023. London Metal Bulletin
("LMB") (Europe) and Asian Metals ("AM") (Asia) averaged US$27.9/kgV
and US$24.1/kgV respectively, with LMB marginally improving from US$26.6/kgV
whilst AM remained unchanged when compared to US$24.2/kgV in Q4 2023.

§ Sales into the higher value markets (aerospace application, speciality
alloy and chemicals) and higher price markets (Nitro Vanadium in North
America) continue to be prioritised.

 

 

ENDS

 

Enquiries: info@bushveldminerals.com

 Bushveld Minerals Limited                                                                     +27 (0) 11 268 6555
 Craig Coltman, Chief Executive Officer
 Chika Edeh, Head of Investor Relations

 SP Angel Corporate Finance LLP                          Nominated Adviser & Joint Broker      +44 (0) 20 3470 0470
 Richard Morrison / Charlie Bouverat
 Grant Barker / Richard Parlons

 Hannam & Partners                                       Joint Broker                          +44 (0) 20 7907 8500
 Andrew Chubb / Matt Hasson / Jay Ashfield

 Tavistock                                               Financial PR                          +44 (0) 207 920 3150
 Gareth Tredway / Tara Vivian-Neal / James Whitaker

 

 

ABOUT BUSHVELD MINERALS LIMITED

Bushveld Minerals is a primary vanadium producer, it is one of only three
operating primary vanadium producers, with a diversified vanadium product
portfolio serving the needs of the steel, energy and chemical sectors.

Detailed information on the Company and progress to date can be accessed on
the website www.bushveldminerals.com (http://www.bushveldminerals.com)

 

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