REG - Strategic Minerals - Cobre Sales Update

Strategic MineralsAnnouncement

07/03/2024 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240307:nRSG8749Fa&default-theme=true

RNS Number : 8749F  Strategic Minerals PLC  07 March 2024

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ('MAR') which has been incorporated into UK law by the
European Union (Withdrawal) Act 2018.

7 March 2024

Strategic Minerals plc

("Strategic Minerals" or the "Company")

Cobre 6-Year February Sales High and Excavator Purchase

Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a profitable producing
mineral company, is pleased to announce that the February sales tonnage
recorded at Cobre was a 6-year high for February sales and Southern Minerals
Group LLC ("SMG"), the Company's wholly owned subsidiary and operator of the
Cobre magnetite stockpile, is acquiring a Caterpillar Excavator (Trackhoe 320)
to assist with expected volume increases.

Highlights

·   February sales tonnage of 4,898 tons represents a 6 year high for
February sales

·   February was also the highest monthly sales tonnage since March 2021

·   Current expectations are for sales of circa 13,000 tons per quarter
after March 2024

·   Revenue from Cobre for 2024 expected to be circa US$3.5m

·   Acquiring a Caterpillar Excavator (Trackhoe 320) to assist year-round
operations

 

Cobre Sales

February 2024 saw the sale of 4,898 tons of magnetite which represented a 6
year high for February sales.  As a portion of SMG's clients are fertilizer
companies, who seasonally increase demand in February and March, the 6 year
high tonnage sales augurs well for the remainder of the year.  As shown in
the following chart, the tonnage sales for the past three years show how lean
2023 was and how the Company believes that sales are now on track to be
maintained at significantly higher levels than over the past three years.

 

Based on February 2024 sales and expectations based on the major client's
purchase order, the Company anticipates sales tonnages of circa 13,000 tons
per quarter after March 2024.  This is expected to result in 2024 revenues of
circa US$3.5m.

Cobre Equipment Purchase

In line with increases in sales, SMG is acquiring a new Caterpillar 320
Trackhoe with delivery expected in early March 2024.  This equipment is being
acquired to ensure production, at these renewed higher levels, can continue
during difficult weather conditions, particularly around the Winter/Spring
period.

The purchase is being fully funded by Caterpillar Finance on a four year loan
facility at an interest rate of 4.99% pa.

Commenting, John Peters, Managing Director of Strategic Minerals, said:

"Encouraging sales in February 2024 and expectations of returning to quarterly
sales of circa 13,000 tons are providing a robust cash flow outlook for the
end of 2024, after resolving creditor payments arising from 2023.

"Cobre's revamped management line up has risen to the challenge and recently
sought the addition of a Trackhoe 320 to ensure continuation of higher volume
operations in difficult weather conditions. Not only was this sourced locally
but the acquisition was wholly financed, with repayments spread in line with
future cash flow expectations.

"Discussions continue with another potentially large client at Cobre but, due
to recent increases in activity, such discussions are now focussed on future
years supply.

"At present, we anticipate further news flow from projects this month and
beyond."

 

 For further information, please contact:

 Strategic Minerals plc                                   +61 (0) 414 727 965
 John Peters
 Managing Director
 Website:               www.strategicminerals.net (http://www.strategicminerals.net)
 Email:                 info@strategicminerals.net (mailto:info@strategicminerals.net)

 Follow Strategic Minerals on:
 Vox Markets:           https://www.voxmarkets.co.uk/company/SML/
                        (https://www.voxmarkets.co.uk/company/SML/)
 Twitter:               @SML_Minerals (https://twitter.com/SML_Minerals)
 LinkedIn:              https://www.linkedin.com/company/strategic-minerals-plc
                        (https://www.linkedin.com/company/strategic-minerals-plc)

 SP Angel Corporate Finance LLP                           +44 (0) 20 3470 0470
 Nominated Adviser and Broker
 Matthew Johnson
 Ewan Leggat
 Charlie Bouverat

 

 

 

Notes to Editors

Strategic Minerals plc is an AIM-quoted, profitable operating minerals company
actively developing projects tailored to materials expected to benefit from
strong demand in the future. It has an operation in the United States of
America along with development projects in the UK and Australia. The Company
is focused on utilising its operating cash flows, along with capital raisings,
to develop high quality projects aimed at supplying the metals and minerals
likely to be highly demanded in the future.

In September 2011, Strategic Minerals acquired the distribution rights to the
Cobre magnetite tailings dam project in New Mexico, USA, a cash-generating
asset, which it brought into production in 2012 and which continues to provide
a revenue stream for the Company. This operating revenue stream is utilised to
cover company overheads and invest in development projects aimed at supplying
the metals and minerals likely to be highly demanded in the future. The access
to this stockpile has been extended until 31 March 2027 and is likely to be
rolled over again at that time.

In May 2016, the Company entered into an agreement with New Age Exploration
Limited and, in February 2017, acquired 50% of Cornwall Resources Limited
(CRL) which holds the Redmoor Tin/Tungsten project in Cornwall, UK. The bulk
of the funds from the Company's investment were utilised to complete a
drilling programme that year. The drilling programme resulted in a significant
upgrade of the resource. This was followed in 2018 with a 12-hole 2018
drilling programme has now been completed and the resource update that
resulted was announced in February 2019. In March 2019, the Company entered
arrangements to acquire the balance of CRL which was settled on 24 July 2019
by way of a vendor loan, subsequently fully repaid on 26 September 2020.
Since this time, CRL has been progressing the development of the Redmoor
Tin/Tungsten project through its involvement in the EU funded Deep Digital
Cornwall exercise and the placement of Tin and Tungsten on the Critical
Minerals List of both the UK and USA.

In March 2018, the Company completed the acquisition of the Leigh Creek Copper
Mine situated in the copper rich belt of South Australia and brought the
project temporarily into production in April 2019. In July 2021, the project
was granted a conditional approval by the South Australian Government for a
Program for Environmental Protection and Rehabilitation (PEPR) in relation to
mining of its Paltridge North deposit and processing at the Mountain of Light
installation. In late September 2022, an updated PEPR, addressing the
conditions associated with the July 2021 approval, was approved.  The Company
continues seeking capital to commence operations.

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDBUGDXSGGDGSL