AIM and Media
Release
26
August 2024
Base Resources Limited
FY24 financial and operational
results
African mineral sands
producer and developer, Base Resources Limited
(ASX & AIM: BSE) (Base Resources or the
Company) is pleased to present its financial,
operational and development results for the year ended 30 June 2024
(FY24).
Kwale Operations continued
to perform to plan and achieved production at the top end of
guidance. During the year, as planned, mining transitioned to
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. As announced in October
2023, the evaluation of the remaining near mine extensional
opportunities concluded they were not economically viable.
Consequently, mining at Kwale is expected to end in December 2024 following the planned depletion of
remaining ore reserves, with processing activities concluding
shortly thereafter.
Discussions with the
Government of Madagascar on the
key fiscal terms that would apply to the Toliara Project
re-commenced in early 2024, shortly after President Rajoelina
formed his new government and appointed his cabinet following his
re-election in late 2023. Base Resources considers
in-principle agreement has been reached on the key fiscal terms
that will apply to the whole Toliara Project (i.e. both mineral
sands and monazite), although these remain subject to entry of
binding documentation and therefore the terms remain subject to
change and timing is uncertain. Engagement with the
Government is now focused on agreeing the terms of the binding
agreements to give effect to the in-principle agreement and other
key matters for facilitating timely project
progression.
Following announcement in
April of the Company's proposed combination with Energy Fuels Inc.
(NYSE American: UUUU, TSX: EFR) (Energy Fuels) to
establish a global leader in the critical minerals sector
(Proposed Combination), the Board has determined
to pay a special dividend of A$0.065
(unfranked) per share in connection with the transaction
(Special Dividend). Payment of the Special
Dividend is conditional on the scheme of arrangement to implement
the Proposed Combination becoming effective
(Scheme)1. In addition to the
Special Dividend, Base Resources shareholders will be entitled to
receive 0.0260 Energy Fuels common shares per Base Resources share
should the Scheme proceed.
Operational and
development highlights for
FY24
-
Transition of Kwale South Dune mining operations to
the Bumamani deposit, following depletion of the Kwale South Dune
ore reserves, impacting mined volumes which were 6% lower, at 15.3
million tonnes, compared to the prior
year.
-
FY24 production guidance achieved, with production of
41,317 tonnes of rutile, 159,395 tonnes of ilmenite, 17,354 tonnes
of zircon and a combined 10,034 tonnes of low-grade rutile and
zircon products, which was less than the prior year due to lower
ore grades and mined
tonnages.
-
Softening product markets resulted in reductions in
average achieved prices of 4% for rutile, 9% for ilmenite and 14%
for zircon compared to the prior
year.
-
Toliara Project Monazite Pre-Feasibility Study
completed, significantly enhancing the overall forecast financial
returns from the project.
Financial
highlights for FY24
-
Revenue of US$135.1
million, a 50% reduction when compared to the prior year due
to lower production and sales
volumes.
-
EBITDA of US$26.4
million and underlying net loss after tax of US$1.6
million.
-
Free cashflow of US$25.7
million (operating cashflows of US$45.4 million less US$19.7 million invested to transition mining at
Kwale Operations to the remaining ore bodies and progress the
Toliara Project).
-
Net cash position of US$88.1
million at 30 June
2024.
[Note
(1): For further information in relation to the Special
Dividend, refer to Base Resources' announcement (also of
26 August 2024) titled "Special
Dividend determined".]
Managing Director
of Base Resources, Tim Carstens,
said:
"The 2024 financial year
has been another successful one for Base Resources. The Kwale
Operations team overcame the dual challenges of new ore bodies and
lower grades to deliver production volumes at the top end of
guidance, while continuing to keep tight control of costs,
contributing to the Group's strong closing cash position of
US$88.1
million. Unfortunately, after exploring all
avenues to further extend mine life, mining at Kwale Operations
will end in December 2024 when ore
reserves are fully depleted as planned. Planning for closure
and the transition to post-mining land use is well advanced, with
the clear objective of cementing a reputation for excellence in the
full life cycle of mining.
Our belief that the
Toliara Project is the best undeveloped mineral sands project in
the world was reinforced following completion of the Monazite
Pre-Feasibility Study in December. With our understanding
that in-principle agreement has been reached with the Government on
fiscal terms and focus shifting to finalising a memorandum of
understanding to record the terms agreed, we consider realisation
of the Toliara Project's potential is now closer than
ever.
By providing the opportunity to go further downstream
and capture more of the rare earths supply chain value and risk
diversification, the proposed combination with Energy Fuels will
only enhance Toliara's exceptional potential and also provide
increased capacity and optionality for funding the project.
The combination also provides shareholders with the opportunity to
receive a compelling and immediate premium, and participate in the
market recognition and development of a company with a diversified
and unique position in the critical minerals
landscape."
Documents attached
and forming part of Base Resources' FY24 results reporting
suite
For further information in relation to Base
Resources' FY24 operating and financial results, refer to the PDF
copy of the Company's 2024 Annual Report attached to this release
and available from the Company's website at:
https://baseresources.com.au/investors/announcements/.
Also attached to this release and available from the
Company's website (link above), and forming part of Base Resources'
FY24 results reporting suite, is the Company's FY24 Corporate
Governance Statement.
Forward 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.
For further details in
relation to the Monazite Pre-Feasibility Study, refer to Base
Resources' announcement on 14 December 2023 "Additional
critical mineral product stream doubles Toliara Project's
NPV". This announcement discloses the material assumptions
and underlying methodologies adopted for deriving the production
and forecast financial outcomes for the Monazite Pre-Feasibility
Study. Base Resources confirms that all the material
assumptions underpinning the production information and forecast
financial information in the announcement continue to apply and
have not materially changed.
ENDS.
For further information
contact:
Australian Media
Relations |
UK Media
Relations |
Sodali &
Co |
Tavistock
Communications |
Cameron Gilenko and
Michael Weir |
Jos Simson and Gareth
Tredway |
Tel: +61 8 6160
4900 |
Tel: +44 207 920
3150 |
This
release has been authorised by the Board of Base
Resources.
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