REG - Harvest Minerals Ltd - Trading Statement

Harvest MineralsAnnouncement

08/03/2022 07:00

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RNS Number : 8348D  Harvest Minerals Limited  08 March 2022

 

 

Harvest Minerals Limited / Index: LSE / Epic: HMI / Sector: Mining

08 March 2022

Harvest Minerals Limited

('Harvest' or the 'Company')

 

Harvest to Ramp Up Production Following An Increase of Over 1,000% in Sales
Orders

 

Harvest Minerals Limited, the AIM listed fertiliser producer, is pleased to
provide a trading update for its organic, multi-nutrient fertiliser, KP
Fértil®, from its 100% owned Arapuá Fertiliser Project in Brazil
('Arapuá').

 

Highlights:

·    CY22 accumulated sales orders as at 28 February 2022 totalled 30,161
tonnes, an increase of over 1,070% compared to internal forecasts for the same
period, and representing:

o  35% of the total 2021 sales orders

o  20% of the sales target for FY 2022 (150,000 tonnes)

·    Company is well advanced on planning stages for an increase of
capacity to 200,000 tonnes

·    Increased demand for KP Fértil® continuing

 

Brian McMaster, Chairman of Harvest, said: "2021 was a pivotal year for
Harvest as demand for our product increased and the Company became profitable.
During January and February 2022, we saw that momentum continue strongly with
an upsurge in orders in February as farmers recognise the benefits of KP
Fértil®, which has now been certified as a fertiliser.  Additionally,
anticipated disruptions in fertiliser deliveries to Brazil leading to expected
product shortages and price rises are causing substantial market volatility.
Consequently, we are benefitting from improved margins and are advancing plans
to accelerate production and storage capacity to increase our role as a
domestic fertiliser provider.

 

"Historically, our sales figures tend to grow throughout the first half of the
year to a peak season around mid-year and then taper further as the wet season
approaches.  During the second half of 2021 and, to date in 2022, we have
seen that trend flatten somewhat with substantially increased demand
throughout the year.  If this trend continues, our previously published sales
target of 150,000 tonnes will be adjusted upward.  Harvest is well placed to
continue to grow organically and satisfy the expected increased demand for its
product."

 

 

 

Further Information:

During the two first months of 2022, Harvest experienced a very strong sales
performance, achieving a total volume of 30,161 tonnes of its KP Fértil®,
representing a 1,070% increase over management's internal forecasts for the
same period.  The total sales orders to date in 2022 accounts for 35% of the
total 2021 sales and 20% of 2022 sales guidance of 150,000 tonnes. In
calculating the 2022 target of 150,000 tonnes, Harvest assumed it would sell
2,574 tonnes during January and February.  The total sales of 30,161 is
substantially more than initially forecast (over a 1,070% increase).

 

Historically, Harvest has experienced a seasonal sales performance with
relatively modest sales during the start of the year ramping up to a buying
season around mid-year, tapering off to more modest sales around the wet
season at year end.  Given the historic expectation that approximately 80% of
sales are seasonally placed in the second half of the year, the Company is
advancing its plans to meet production of 200,000 tonnes.

 

Additionally, it has been widely reported that Brazil is experiencing product
shortages and price increases due to a global supply shortage.  Harvest
experienced an increased demand and improved sales value for KP Fértil®
prior to the current macro-environment developments.  Notwithstanding,
current events appear to be accelerating demand and again improving prices and
we are responding accordingly.  Given Harvest's business has a strong gross
profit margin and the relatively fixed nature of OPEX costs, we expect any
increase in sales value will reflect strongly in the net profit of the
business. In addition, the Government of Brazil is debating the introduction
of various legislative and economic stimulus packages to incentive local
production.

 

 

**ENDS**

 

For further information, please visit www.harvestminerals.net
(http://www.harvestminerals.net/)  or contact:

 

 Harvest Minerals Limited            Brian McMaster (Chairman)   Tel: +44 (0) 203 940 6625

 Strand Hanson Limited               Ritchie Balmer              Tel: +44 (0) 20 7409 3494

 Nominated & Financial Adviser       James Spinney

 Tavira Securities                   Jonathan Evans              Tel: +44 (0)20 3192 1733

 Broker

 St Brides Partners Ltd              Isabel de Salis             Tel: +44 (0) 20 7236 117

 Financial PR                        Ana Ribeiro

                                     Oonagh Reidy

 

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