REG - PYX Resources Ltd. - Operations Update HY 2022

PYX ResourcesAnnouncement

21/07/2022 07:00

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RNS Number : 2686T  PYX Resources Limited  21 July 2022

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PYX Resources Limited / EPIC: PYX / Market: Standard / Sector: Mining

 

 

21 July 2022

 

PYX Resources Ltd

("PYX" or the "Company")

 

Operations Update HY 2022

Consistent Price Growth Despite June's Metal Crash

 

HIGHLIGHTS

 

·     PYX Premium Zircon prices continued to increase to US$2,749 per
tonne for H1 2022 showing an 92% YoY increase

·     Mineral Sands production grew by 163% after starting production of
TiO(2) feedstocks

·     Sales Volume grew by 19% amid logistics delays

·     Order book and pricing remain strong as a result of the lack of
supply

·     Zircon prices shown to be stable even after June's metal market
crash

·     Vaccinated 100% of its employees against Covid-19

 

Commenting on the Company's achievements in HY22, PYX Resources' Chairman and
Chief Executive Officer, Oliver B. Hasler, said:

 

"I am very pleased with our achievements during HY 2022. We have increased our
production volumes and started producing rutile and ilmenite by-products at
our mine. The Mineral Sands industry is experiencing a strong upcycle with
prices driven by supply-demand fundamentals. This was particularly evident,
during last month's metals price crash, where Mineral Sand prices remained
unaffected, despite a significant crash in most other metals.

 

We are optimistic about the second half of the year and remain well placed to
deliver on our strategic plan and benefit from the strength and continued rise
of the Mineral Sands prices."

 

 

PYX Resources Ltd (NSX: PYX | LSE: PYX), the world's second largest
publicly-listed Zircon producer by zircon resources(( 1  (#_ftn1) )), is
pleased to announce an operational update for the six months ended 30 June
2022 ("H1 2022") ahead of the publication of its interim results for the same
period, anticipated to be release on or around 13 September 2022.

 

The Company has performed strongly in the first half of the year due to a
boost in Mineral Sands production, sales volume growth, and ongoing price
increases. In H1 2022, PYX produced 9.2kt and sold 3.9kt of Mineral Sands,
resulting in a year-on-year production increase of 163% and 19% sales rise,
respectively. The year-on-year ('YoY') Premium Zircon production increased by
23%. The Company increased its finished goods inventories to 5.8kt as a result
of the start of Rutile and Ilmenite production and limited freight
availability at the end of June 2022.

 

June 2022 saw the metals market come under pressure and experience the hardest
crash since the crash in 2008. 2  (#_ftn2) We believe the trigger was not only
the equity markets but the uncertainty of global recession, inflation, higher
interest rates, and the fear that the war in Ukraine might spread to other
countries. In the period 1 January 2022 to 30 June 2022, Copper for example
had a -14.9% percent correction to US$8,245t and tin fell sharply by -32.2% to
US$26,689t. 3  (#_ftn3) During the same period, Mineral Sands prices (as
measured by Asian Metal) showed an increase. South African Zircon and
Australian Zircon increased for the period of H1 2022 from US$1,860t to
US$2,110t  4  (#_ftn4) and PYX's Premium Zircon went from US$2,450t to
US$2,766t (being the Company's average prices for the months of January 2022
compared with June 2022), which we believe illustrates that Mineral Sands
prices are based on physical trade which is impacted by a lack of supply.

 

In December 2021, PYX Resources announced that it had increased its capacity
at its Minerals Separation Plant by 33%. The additional 6ktpa capacity was
utilised to produce Rutile and Ilmenite during H1 2022. Tailings accumulated
over the years were used to feed the process, which resulted in an Ilmenite
inventory of 4,595 tonnes and Rutile of 318 tonnes. Moving from sole Premium
Zircon production to Premium Zircon, Rutile and Ilmenite reduced the Premium
Zircon output for H1 but we believe it will benefit the total operation and
margins in the long run.

 

Customer demand continued to be strong, showing particular interest in PYX's
Premium Zircon due to its low aluminium oxide (AI(2)O(3)) of under 0.2%. In
addition, the uranium and thorium content of PYX's Zircon is less than 500ppm.
PYX has continued to diversify its sales into different countries and
industries, including adding customers in Spain, USA and UK in the last six
months as the Company seeks to limit its exposure to potential customer
disruptions amid geopolitical issues.

 

Currently, more than 70 Governments (including China, European Union and the
United States) have set the year 2050 as the goal for Net-Zero emissions and
alongside this have overseen the rollout of various technologies considered
essential to the energy transition including solar cells, nuclear energy, and
catalysis, many of which currently require Zircon in their manufacture. The
Australian Government classes Zircon, Rutile, and Ilmenite, as crucial
minerals vital for the economic well-being of the world's major and emerging
economies. As the world moves toward decarbonisation, the demand for zircon is
expected to continue to increase.(( 5  (#_ftn5) ))

 

PYX Cares Programme

During 2022 PYX continued with its PYX Cares programme based on 5 pillars:
People, Planet, Prosperity, Peace, and Partnership and subscribed to the UN
Global Compact. In 2022, PYX realised projects on quality education, clean
water and sanitation, viable employment, and building partnerships to further
these goals.

 

During the period the Company reported some Covid-19 cases, but none have
resulted in fatalities. The Covid-19 vaccination programme has been successful
with 86% of its employees fully vaccinated with the 3(rd) Covid-19 vaccine and
100% vaccinated with the first two vaccines. For the second consecutive year
PYX has taken part in National Blood Donor Day, using the banner 'Give Blood,
Save Life'.

 

*** ENDS ***

For more information:

 PYX Resources Limited                                    T: +852 3519 2860

 Oliver B. Hasler, Chairman and Chief Executive Officer   E: ir@pyxresources.com (mailto:ir@pyxresources.com)
 WH Ireland Limited (Financial Adviser and Joint Broker)  T: +44 (0)20 7220 1666

 Harry Ansell / Katy Mitchell / Megan Liddell

 St Brides Partners Ltd (Financial PR)                    E: pyx@stbridespartners.co.uk

 Ana Ribeiro / Isabel de Salis / Isabelle Morris

 

About PYX Resources

PYX Resources Limited (NSX: PYX | LSE: PYX) is a producer of premium zircon
dual listed on the National Stock Exchange of Australia and on the Main Market
of the London Stock Exchange. PYX's key deposits, Mandiri and Tisma, are
large-scale, near-surface open pit deposits both located in the alluvium-rich
region of Central Kalimantan, Indonesia. PYX, whose Mandiri deposit has been
in production since 2015, is the 2nd largest publicly traded producing mineral
sands company by zircon resources globally. Determined to mine responsibly and
invest in the wider communities where we operate, PYX is committed to fully
developing its Mandiri and Tisma deposits, with the vision to consolidate the
mineral sands resources in Kalimantan and explore and acquire mineral sands
assets in Asia and beyond.

 

 1  (#_ftnref1) According to publicly available information during the
financial year ended December 2020

 2  (#_ftnref2) Refer article "Industrial Metals see biggest Q2 drop since
2008 as sentiment collapses - ANZ" by Anna Golubova, Monday July 11, 2022,
Kitco News www.kitco.com

 3  (#_ftnref3) London Metal Exchange - LME Copper Official Prices and LME Tin
Official Prices (lme.com)

 4  (#_ftnref4) Prices sourced from Asian Metal (asianmetal.com)

 5  (#_ftnref5) Australian Government, Australian Critical Minerals Prospectus
2021 https://bit.ly/3qfYInX (https://bit.ly/3qfYInX)

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